WRITTEN QUESTION E-0543/04 by Erik Meijer (GUE/NGL) to the Commission. CAP: the declining contribution of EU funds to the survival of small farmers in a context of low consumer prices and low world market prices.
Date: 2004-02-26
Institutions: European Parliament, Provisional data
Subjects: aid to agriculture, common agricultural policy, farmers' income, smallholding

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Official Journal of the European Union

EN

3.4.2004

(cid:1) what is the framework of the 2007-2013 financial perspective for the current 15 EU Member States

only;

(cid:1) how has the weight of

the Structural Funds developed between 1988 and 2003,
Community GDR percentage terms? What are the forecasts for 2004, 2005 and 2006?

in GDP or

Answer given by Mrs Schreyer on behalf of the Commission

(16 March 2004)

1.
It is not possible to break down the proposed ceiling for expenditure under Heading 1A by Member
State. The weight of each programme under Heading 1A will only be determined at a later stage. At any
rate, each programme will consist of a global financial envelope rather than nationally allocated envelopes.

The amounts for the Solidarity Fund correspond to EUR 1 billion per year in current prices. Since the table
contained in the Commission Communication is expressed in constant 2004 prices,
the equivalent
amounts are:

Year

2007

2008

2009

2010

2011

2012

2013

(million euro)

Amount

942

924

906

888

871

853

837

The amounts of the European Development Fund will be negotiated and decided at a later stage.

Since the majority of

financial envelopes rather than
2.
nationally allocated ones, it is not possible to calculate the share of the EU-15 in the financial perspective
table.

the programmes only consist of global

The requested figures are sent direct to the Honourable Member and to Parliament’s Secretariat.

(2004/C 84 E/0693)

WRITTEN QUESTION E-0543/04

by Erik Meijer (GUE/NGL) to the Commission

(26 February 2004)

Subject: CAP: the declining contribution of EU funds to the survival of small farmers in a context of low

consumer prices and low world market prices

1.
In the Commission’s opinion, has the existence of the Common Agricultural Policy in recent decades
and the financial assistance from Community funds which it provides helped to enable small and medium-
sized farmers, in both the arable and livestock sectors, despite relatively low consumer prices for their
products and falling prices on the world market, to remain able to earn an acceptable income and thus to
ensure the continuity of production?

2.
In the light of the recent study by the development organisation Oxfam, can the Commission
confirm that the funding currently provided under the CAP is increasingly failing to guarantee the survival
of small farmers and that the bulk of it goes to large farmers and large land-owners?

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3. When did the change referred to at 2 occur? Did it happen after the accession of new Member States
with bigger disparities in land areas owned than existed in the six founder Member States of the European
Communities?

To what extent was the existing financing method responsible for the fact that, after previous
4.
increases in scale, the number of farms in the present 15 Member States declined by a further 15,7 %
between 1995 and 2002? Why was this method of
the development
concerned?

financing unable to prevent

Supplementary answer
given by Mr Fischler on behalf of the Commission

(19 April 2004)

1.
Over recent decades, the instruments of the common agricultural policy have progressively evolved
away from supporting products by maintaining high internal prices and providing major protection at the
border.

With the 1992 reform, those prices were progressively reduced and direct aid to producers introduced to
compensate farmers’ income losses.

The direct payments were proportional to livestock reared and areas cultivated. They were therefore
indirectly linked to production.

This latter component was recently radically altered by the reform adopted in June 2003 with the
introduction of direct payment decoupling. Income support is now independent of the farm’s production
volume.

At the same time, a structural rural development policy has been progressively devised to support the
process of modernising European agriculture, to pay for farmers’ non-commercial (cid:1) environmental (cid:1)
activities and to support the income of farms located in areas with a natural handicap. Throughout this
process the Commission has been attentive to the situation of small and medium-sized farms, which form
an important part of Europe’s rural fabric. The Commission can affirm that the evolution in types of
support has helped to maintain the income of numerous small and medium-sized farms.

2.
As stated above, CAP support was originally linked to the quantities produced and then to the areas
cultivated and livestock kept. For structural reasons which preceded the CAP, the large structures present
in some Member States therefore received a major share of the support. Since the 1992 reform there has
been a slight redistribution of support in favour of small and medium-sized farms, as can be seen from the
figures published by the Commission at Parliament’s request (1). This evolution has nevertheless been
limited by the fact that only two Member States have introduced the modulation mechanism. This
mechanism, which provides for a levy on funding intended for direct aid in order to transfer it for the
benefit of rural development measures, has so far been optional. Under the 2003 reform, the Commission’s
proposal that modulation should be made compulsory was adopted by the Council. The transfert will be
3 % from 2005, rising progressively to 5 % from 2007. However, the mechanism will not entail any
reduction in direct aid for farms receiving less than EUR 5 000/year.

3.
There were farm size disparities and large structures in the original six Member States (for example,
in Italy), then in some Member States which joined the Union at the time of the successive enlargements
(the eastern German Länder, Spain, the United Kingdom), just as there are in some new Member States
which are emerging from a centrally-managed economic system. That is also why a structural policy was
introduced from the early 1970s to support the process of restructuring and modernising farms.

The reduction in the number of farms in the EU is the result of numerous factors,

4.
including:
increased productivity in agriculture and the related increase in farm size, the urbanisation process and
employment market changes in the advanced economies.

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It may also be noted that the rate of reduction in farm numbers and in agricultural employment is largely
independent of the common agricultural policy’s evolution. The CAP’s objective is to develop sustainable
agriculture (cid:1) i.e. agriculture which is competitive, economically viable and environmentally compatible (cid:1)
by improving production structures at a socially acceptable cost.

(1) http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=MEMO/02/198|0|RAPID&lg=EN&display=

(2004/C 84 E/0694)

WRITTEN QUESTION E-0544/04

by Erik Meijer (GUE/NGL) to the Commission

(26 February 2004)

Subject: CAP: intended change in the ratio between payments to large and small farms, a ceiling for aid per

farm and limiting the damage caused to third countries

1. When the reforms of
the Common Agricultural Policy proposed by the Commission are
implemented, what impact does the Commission expect them to have on the ratio between payments to
large and small farms: will it remain unaltered or will it change? What impact does the Commission intend
the reforms to have in this respect?

2.
Apart from the changes which the Commission has already proposed, does it consider additional
measures necessary to prevent further emigration from rural to urban areas, which would ultimately cut
agricultural production for the EU’s internal market?

3. Will the Commission work towards a subsidy model which safeguards the interests of small farmers
better than at present, for example by setting a limit (cid:1) e.g. EUR 30 000 (cid:1) for financial aid to a single
farm?

4. When weighing up the shape which the reform of the CAP should ultimately take, will
the
Commission also bear in mind the impact on small farmers in other parts of the world, particularly their
uncertainty regarding the supply of food and industrial raw materials for the internal market in the Third
World due to market-distorting, relatively cheap imports of farm surpluses from EU Member States?

Supplementary answer
given by Mr Fischler on behalf of the Commission

(13 April 2004)

1.
The new system of direct payments to be introduced with the Common Agricultural Policy (CAP)
reform will, in principle, not change the distribution of direct support between farms since it is based on
historic references. However, taking into account the introduction of direct payments in the dairy sector
and the option available to Member States for a regionalisation of the Single Farm Payment, redistribution
of payments between farmers, within a region, may take place. Moreover, modulation of direct payments
will explicitly favour smaller farms, since the first EUR 5 000 are exempted from modulation.

In its July 2002 Communication (1), the Commission had proposed to modulate direct payments by up to
20 %, to increase the franchise according to the number of annual worker units and to introduce a ceiling
for direct payments per farm of EUR 300 000. This would have triggered a stronger redistribution effect
but was not supported by a majority of Member States.