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EU states agree farm reform, but deal not yet done

21 March 2013, 13:19 CET
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EU states agree farm reform, but deal not yet done

Photo © Valcho - Fotolia

(BRUSSELS) - European Union agriculture ministers agreed a plan to reform the bloc's often contested farm policy, its top budgetary item, after marathon talks winding up late Tuesday.

Ireland, which currently holds the rotating EU presidency, hailed the deal struck after two days of talks as "an enormous step forward" and "a watershed moment" in months of efforts to reform the Common Agricultural Policy (CAP) that accounts for 38 percent of the EU budget.

CAP spending has traditionally divided EU states, with France, Spain, Germany and Italy the major beneficiaries, and the overnight deal failed to win the support of all 27 member states, with Slovakia and Slovenia staying out.

The deal sets the stage for three-way talks to begin next month between the 27 governments, the European Parliament and the European Commission -- each of which have their own reform plan -- with Ireland hoping to clinch a final agreement by end June that would set 2015 as the date for implementation.

Like the parliament, the ministers agreed to tie 30 percent of direct farm subsidies to respect for the environment.

Measures include crop diversity, maintaining permanent pastures, and creating ecological fallow areas that are havens for plants, animals and insects on arable land.

But while the Commission called for 7.0 percent of land to be such "ecological focus areas", the ministers agreed a lesser 5.0 percent.

The ministers also softened Commission proposals to reduce differences in EU funding within member states but more significantly to give more to young and small farmers and less to large agricultural holdings.

Brussels had suggested a flat rate of subsidies per hectare (2.47 acres) by 2019 to counter the current system which sees 80 percent of subsidies going to larger farms.

In the interests of the environment, Brussels proposed gradually favouring extensive rather than intensive farming by progressively calculating subsidies per hectare from 2014 to 2019, rather than basing payments on production, as has often been the case.

Despite German misgivings, the ministers also agreed to demands from France, the biggest beneficiary of CAP funding, to partially link subsidies to sectors in difficulty such as dairy farming and fruit and vegetables.

Also on a request from Paris, small farms will receive a higher rate of direct payments.

In a separate deal last week, parliament backed Commission plans to cap direct payments to any one farm at 300,000 euros and reduce payments to those receiving more than 150,000 euros.

Lawmakers also approved moves to limit subsidies to "active" farmers in order to ensure cash does not go to golf clubs and airports as has happened in the past.

PRESS RELEASE - 3232nd Council meeting - AGRICULTURE and FISHERIES - Brussels, 18-19 March 2013 (provisional version)

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