SCHOOL MILK
(20842)
14114/99
COM(99) 608
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Draft Council Regulation amending Regulation (EC) No. 1255/99 on the common organisation of the market in milk and milk products.
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| Legal base: |
Articles 36 and 37 EC; consultation; qualified majority voting
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| Department: |
Agriculture, Fisheries and Food
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| Basis of consideration:
| Minister's letter of 24 July 2000
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| Previous Committee Report:
| HC 23-ix (1999-2000), paragraph 9 (16 February 2000), and HC 23-xiii (1999-2000), paragraph 26 (5 April 2000)
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| Discussed in Council:
| 17 July 2000 |
| Committee's assessment:
| Politically important |
| Committee's decision:
| Cleared (decision reported on 16 February 2000); but further information requested
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Background
12.1 In our Report of 16 February, we noted
that a firm of consultants had concluded that the fully funded
Community subsidy for the provision of school milk represented
poor value for money compared with alternative methods of surplus
disposal, and that the Commission had told the European Agricultural
Guidance and Guarantee Fund (EAGGF) Committee in May 1999 that
it intended to publish a proposal that autumn to abolish the scheme
from July 2000. We further noted that, after the Agriculture Council
had stressed the importance it attached to the nutritional benefits
of milk consumption, the Commission had instead proposed that
the scheme should continue, but with only 50% of the funding being
provided by the Community. We went on to support the Government's
stated intention to persuade the Commission to retain the scheme
in its present form.
12.2 We did, however, ask for clarification
on one point. This related to the Government's opposition to targeting
of this subsidy scheme for co-financing, where we said that we
had been under the impression that it was in general in favour
of co-financing under the CAP, and that we assumed that its opposition
in this case was simply to one particular proposal being singled
out for such treatment. As we noted in our Report of 5 April 2000,
this point was addressed in a letter of 27 March 2000 from the
Minister of State (Commons) at the Ministry of Agriculture, Fisheries
and Food (The Rt. Hon. Joyce Quin). She confirmed that, in general,
the Government has no objections in principle to the concept of
co-financing, but that initially, in the case of this proposal,
it was opposed on the grounds that the Commission had selected
the School Milk Scheme in isolation on the basis of a poorly researched
evaluation. However, she went on to say that, at the Agriculture
Council on 20 March, the Minister of Agriculture had indicated
that the UK would be prepared to consider co-financing.
Minister's letter of 24 July 2000
12.3 In response to our request to be kept
informed of developments in Brussels on this point, we have now
received from the Minister a further letter of 24 July 2000. She
says that, at its meeting on 17 July, the Agriculture Council
unanimously agreed that, with effect from 1 January 2001, the
school milk subsidy rate should be reduced from 95% to 75% of
the target price for milk, but that this reduced rate will be
funded entirely from the EAGGF budget. She adds that this compromise
also provides for Member States to make an additional contribution
up to an unspecified amount on eligible products, which can be
sourced from national exchequers, raised by means of a levy on
the dairy sector, or by a voluntary contribution from the dairy
industry. The Minister also says that the Commission has undertaken
to review the administration of the scheme, with a view to simplification;
to revise the list of eligible products to include low fat yoghurt
and skimmed milk; and to revise the coefficients used to calculate
the aid rate for low fat products by taking their protein content
into account.
Conclusion
12.4 We are grateful to the Minister
for this further information. In noting that a Regulation
has now been adopted by the Council, we would be interested to
know whether it is intended to make use in the UK of the facility
to top up the EAGGF subsidy (and, if so, which of the possible
means outlined in the previous paragraph would be employed).
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