Duff Says EU Farm Reform 'Overdue, Modest But Serious'

12.00.00am BST (GMT +0100) Thu 26th Jun 2003

Reacting to today's decision by EU Farm Ministers Andrew Duff, Liberal Democrat MEP for the East of England, described the package of CAP reforms agreed by the EU Council today as "overdue, modest but serious".

Duff said:

"The key element of the CAP mid-term review is the decision on the decoupling of direct payments to farmers from their production of food. This severing of the link between subsidies and production will make Europe's farmers more competitive and market oriented. Surplus production and dumping on world markets will be curbed. The consumer also benefits in terms of value for money."

"While significant necessary reforms were agreed, many elements of the Commission's original proposal were watered down due to pressure from France and Germany. Nevertheless, this is a good step forward for reform of the agricultural policy to the benefit of all farmers in the East of England.

"Today's agreement significantly strengthens the EU's position in the upcoming World Trade Organisation talks in Cancun in September. It is now up to our international trade partners, particularly the US, to follow the EU's lead and liberalise farm policy"

Notes:

The key elements of the new, reformed CAP include:

• a single farm payment for EU farmers, independent from production; limited coupled elements may be maintained to avoid abandonment of production,

• this payment will be linked to the respect of environmental, food safety, animal and plant health and animal welfare standards, as well as the requirement to keep all farmland in good agricultural and environmental condition ("cross-compliance"),

• a strengthened rural development policy with more EU money, new measures to promote the environment, quality and animal welfare and to help farmers to meet EU production standards starting in 2005,

• a reduction in direct payments ("modulation") for bigger farms to finance the new rural development policy,

• a mechanism for financial discipline to ensure that the farm budget fixed until 2013 is not overshot,

• revisions to the market policy of the CAP:

• asymmetric price cuts in the milk sector: The intervention price for butter will be reduced by 25% over four years, which is an additional price cut of 10% compared to Agenda 2000, for skimmed milk powder a 15% reduction over three years, as agreed in Agenda 2000, is retained,

• reduction of the monthly increments in the cereals sector by half, the current intervention price will be maintained,

• reforms in the rice, durum wheat, nuts, starch potatoes and dried fodder sectors.

The agreed reforms will now enter into force in 2004 and 2005, with the single farm payment coming into force in 2005.