Select Committee on European Legislation Eighteenth Report
REFORM OF THE OLIVE OIL RÉGIME
15. We have given further consideration to the following on the basis of a
Supplementary Explanatory Memorandum. We maintain our opinion[29] that it raises questions of political importance, but now make no
recommendation for its further consideration:--
Ministry of Agriculture, Fisheries and Food
(17906)
6069/97
COM(97)57 |
A note from the Commission on the olive and olive oil sector (including
economic, cultural, regional, social and environmental aspects), the current common market
organisation, the need for a reform and the alternatives envisaged; options paper. |
| Legal base: |
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Background
15.1 On 5 March we considered the Commission's note, which set out two options for
reform of this régime: one based on mechanisms similar to the present olive oil régime,
the second based on aid per tree. In his Explanatory Memorandum of 25 February, the Minister of
State at the Ministry of Agriculture, Fisheries and Food (Mr Baldry) did not give any indication
of the Government's preference and we asked the Government to let us have its views in more detail.
Supplementary Explanatory Memorandum
15.2 In his Supplementary Explanatory Memorandum of 17 March the Minister of State
says:
"The Government has been pressing for a simpler, less expensive régime which is
less open to fraud. It welcomes the publication of the Commission's reflection paper and the
opportunity to discuss the two options. On the basis of the information currently available the
Government favours the second option to introduce a decoupled aid per tree and replace intervention
with private storage aid..."
"The Government believes that the aid per tree would be the simpler option and that
it will be easier to control than the current system. The introduction of a Geographical
Information System to check the number of trees and cross check aid applications would reduce the
scope for fraud. With an overall limit on the amount of aid paid, an aid per tree would reduce the
incentive to over-produce olive oil. A per tree aid would also be in line with the general thrust
of Common Agricultural Policy (CAP) reform to move away from production based systems to direct aid
paid to farmers. The Government supports the abolition of intervention in favour of private storage
aid for budgetary reasons."
15.3 He points out that one drawback to the per tree system is that four out of the
five producer Member States have yet to complete the register of olive trees. The Commission's first
option would, however, still be open to fraud even though its proposed variant of the production
aid system, based on oil marketed, would be an improvement.
Conclusion
15.4 It is helpful to have the Government's preliminary views on the options. The
faults with the present system are well known. We recognise that a change to payment on a per tree
basis would need to be carefully monitored, and we also recognise the need to ensure that olive
trees are not planted in unsuitable areas simply to obtain subsidy for the tree (a point which the
Government has not dealt with) . We assume therefore that some limitation will need to be made to
prevent abuse of a per tree system, while at the same time recognising the importance of traditional
olive cultivation in areas which can grow few other crops. We note that formal proposals are
expected in the late Summer and we will wish to study these closely. In the light of the
information in the Supplementary Explanatory Memorandum, we are now clearing the note by the
Commission.
29.(17906) 6069/97; see HC 36-xvi (1996-97), paragraph 8 (5 March 1997). Back
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