NFU warning over financing of CAP

Apr 18 2005 By Anna Lognonne, The Journal

Farming representatives from the UK have put forward their opinions on the future financing of the Common Agricultural Policy.

Meurig Raymond, NFU vice-president, told members of the European Parliament that the agriculture budget should reflect the changing and expanding nature of European integration.

He also called for the Brussels financial ceiling, agreed in 2002 by the heads of government, to be honoured, warning that rural development projects could be jeopardised if it wasn't.

Mr Raymond stressed to MEPs that the proposals by some major states to reduce budgetary contributions could result in a decrease of up to 18pc in rural development funding and warned: "Such cuts could damage the EU's ability to meet its own commitment under the EU Treaty to ensure a fair standard of living for the agricultural community and to follow a model of sustainable agriculture.

He added that mandatory or voluntary co-financing would not address the fundamental issues and could lead to big distortions of competition in the single market.

Mr Raymond said: "The NFU believes that the agricultural budget should reflect the changing nature of European integration.

"Any further enlargement of the European Union will undoubtedly increase Pillar 1 expenditure. As such, we believe that the increase in the financial ceiling proposed by the EU Commission for Bulgaria and Romania is necessary.

"Therefore, we view with concern the statements of those Member States (and of the draft report to the EP Temporary Committee) that postulate that there is no need for additional money to accommodate Bulgaria and Romania." He added: "We supported the Common Agricultural Policy Reform in 2003, but most of our colleagues across Europe did not.

"It was difficult to get a majority vote for reform in Luxembourg in 2003, but the agreement on future financing throughout the reform period undoubtedly helped.

"If this agreement is now torn up, it will be all the more difficult to get agreement for any further reform. Moreover, CAP reform is an ongoing process that should, in any case, be primarily driven by the pursuit of EU objectives and not by the negotiations on financial perspectives."

According to the NFU if the EU budget is not capped and Pillar 1 funding is not modified, a reduction in the overall EU budget in a proportional manner across all headings, will result in a decrease in rural development expenditure by some 18pc.

"In this case, either national governments will have to increase their expenditure in rural development, or beneficial rural development projects will be abandoned due to lack of resources.