HC Deb 30 October 2002 vol 391 cc810-2W
Mr. Spring

To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on the Government's policy on the European Commission's proposals in the Common Agricultural Policy's mid-term review to cap subsidies for individual farms. [75251]

Mr. Morley

[holding answer 23 October 2002]: The Government's policy on the commission's proposal to cap subsidies for individual farms is that it goes against the grain of proposals that are intended to encourage increased efficiency. It would discourage rationalisation and modernisation and discriminate against efficient large-scale producers.

Mr. Ancram

To ask the Secretary of State for Environment, Food and Rural Affairs what the Government's policy is on decoupling of subsidies from production as part of the mid-term review of the common agricultural policy; and if she will make a statement. [75959]

Mr. Morley

We are in favour of decoupling in principle. It helps to reconnect farmers to markets, removes perverse incentives to environmental damage through overproduction and should contribute to a successful conclusion of the WTO development round and discharging our obligation to the poorest countries. However, there are a lot of issues to resolve before we can introduce a workable system.

Mr. Spring

To ask the Secretary of State for Environment, Food and Rural Affairs if the Government aims to achieve real budgetary savings in the CAP as part of the mid-term review of the Common Agricultural Policy. [75246]

Mr. Morley

[holding answer 23 October 2002]: The Government's view is that the Commission proposals for reform of the Common Agricultural Policy do not go far enough. We believe that agricultural expenditure should be reduced over time and that the mid-term review should provide for real budgetary savings.

Mr. Spring

To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on the Government's position on the place of modulation in the European Commission's proposals for the mid-term review of the Common Agricultural Policy. [75247]

Mr. Morley

[holding answer 23 October 2002]: The Government supports a shift from production linked support to agri-environment and rural development measures. However, we do not believe that the Commission's proposals for achieving this through modulation go far or fast enough. In particular, the proposals would not deliver real budgetary savings which are necessary to put the CAP budget on a more sustainable footing. In addition, the Commission's proposal includes a franchise excluding very small farms and ceiling on payments to the largest farms which would be unnecessarily complex to administer, and could introduce distortions in farm structures.

Mr. Spring

To ask the Secretary of State for Environment, Food and Rural Affairs what the Government's policy is on subsidised agricultural exports from the European Union with regard to mid-term review of the Common Agricultural Policy. [75250]

Mr. Morley

[holding answer 23 October 2002]: The UK supports the commitment made by World Trade Organisation (WTO) members, including the EU, to "substantial improvements in market access (import tariff reduction); reductions of, with a view to phasing out, all forms of export subsidies; and substantial reductions in trade-distorting domestic support" as part of the current round of WTO negotiations (the Doha Development Agenda).

Mr. Ancram

To ask the Secretary of State for Environment, Food and Rural Affairs if she will estimate the yearly costs of the Common Agricultural Policy to the EU budget over the next four years if there(a) is and (b) is not decoupling of subsidies from production in the Common Agricultural Policy. [75958]

Mr. Morley

The European Commission have forecasted the annual cost of the Common Agricultural Policy (CAP) to the EU budget until 2006, as set out in the table. These estimates assume the continuation of current policy and exclude expenditure on rural development. Without knowing how a decoupled payment system would work in detail any assessment of its impact of the EU budget would be purely speculative.

EU budget expenditure on CAP
Euro million1
2003 40,420
2004 41,452
2005 41,265
2006 41,770
1Forecast

Source: European Commission

Mr. Ancram

To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on the Government's policy on the Common Agricultural Policy with regard to the mid-term review. [75961]

Mr. Morley

We want to see a radical reform of the CAP, to secure:

  1. (i) a shift in support from production-linked subsidies to environmental and rural development measures;
  2. (ii) a significant increase in the UK's share of pillar 2 funding;
  3. (iii) degressivity of direct payments, on an equitable basis;
  4. (iv) support price cuts, especially for dairy and cereals and the relaxation of associated production controls;
  5. (v) decoupling of direct livestock payments from production.