The Secretary of State for Environment, Food and Rural Affairs (Mr Owen Paterson)
I represented the UK at the Agriculture and Fisheries Council on 24 and 25 June in Luxembourg. Richard Lochhead MSP, Alun Davies AM and Michelle O’Neill MLA also attended.
The Irish presidency’s objective for council was to obtain political agreement from member states on the four regulations that set out the rules for the common agricultural policy (CAP) over the 2014-20 financial period. An agreement was reached on a revised mandate late on Tuesday night. On the basis of that mandate, the presidency was then able to reach an outline agreement with the European Parliament on Wednesday 26 June.
The UK agreed to the mandate on the direct payments, rural development and the horizontal regulations. Overall I do not think the CAP package represents genuine reform. However, thanks to our efforts, working with other like-minded member states, it is in a much better state than the original proposals. By agreeing a deal on these regulations we have provided certainty for farmers and delivery bodies.
On the direct payments regulation, I argued strongly on the importance of flexibility for member states to deliver the Commission’s “greening” proposals, if they wish to, through national certification schemes, allowing all the regions of the UK the possibility to achieve a better balance between costs and environmental benefits than if we were to apply the measures set out in the Commission’s original proposal. On coupled support, the prospect of return to tobacco subsidies has been successfully resisted. However, it is disappointing that there is not a common set of rules for member states and there will be an opportunity to increase the use of coupled schemes. This is a backward step as EU agriculture has made good progress in phasing out subsidy linked to production. In terms of simplification there will be a mandatory active farmer test but we successfully negotiated this should only be based on assessing against a much shorter list of business types. In addition, the small farmer measure will also be voluntary though the young farmer provisions ended up as mandatory.
On rural development, the agreed regulation will enable all regions of the UK to deliver environmental benefits and rural economic growth through their rural development programmes. A solution was found which removes the threat of farmers being paid twice, once under each pillar of the CAP, for carrying out the same environmental measures. Member states will also have to spend at least 30% of their rural development budget on environmental measures. This is important to help support farmers in their crucial role in enhancing and protecting the natural environment.
On the horizontal (finance and control) regulation, there was the inclusion of some UK-inspired simplifications. This includes on areas such as audit provisions, having a longer transition period for mapping requirements under the greening measures, and a more proportionate approach on penalties. The ability to use a monthly average euro to sterling exchange rate may also help give more certainty to farmers and paying agencies who decide to use this option.
Together with Germany I abstained in the vote on the single common market organisation (single CMO). In an attempt to secure agreement with the European Parliament, changes were introduced which did not continue on the trajectory of reform. Market intervention is unnecessary, costly, and should only be used in times of genuine crisis as it has negative effects on farmers’ abilities to respond to market signals and consumer demand. While end dates have been set for production quotas for sugar beet and planting rights for vines, these have been extended beyond dates previously agreed. Nor were adequate safeguards introduced for the sugar refinery sector. This is bad for businesses and consumers, and will keep prices artificially high. In addition, I was unhappy with the move to allow the European Parliament’s involvement in decisions on reference prices and intervention prices that was part of the final agreement. I believe this does not adhere to the treaty on the functioning of the European Union principles on the balance of responsibilities between the Council and the European Parliament. It was right that the UK took a principled stand.
Throughout the negotiations, I worked closely with all of the devolved Administrations and, as a result, secured outcomes that successfully address some of their key concerns. Most importantly, I achieved a statement from the European Commission which acknowledges that all four regulations can be implemented regionally, in line with the UK’s devolution arrangements. I also obtained a smoother transition than in the Commission’s original text from historical to area-based direct payments, a switch that the devolved Administrations have yet to make. Finally, I was able to ensure that the text included a provision giving them flexibility to utilise their regional reserves to top-up payments to new entrants to farming, an issue which was particularly important to the Scottish Government.
There was one AOB point on the Council agenda from a number of member states who had been affected by flooding in central and eastern Europe. The Council noted concerns on the impact on agriculture in these countries and noted that there were a number of existing tools available that member states could draw on to provide additional support in such times of crisis.