Select Committee on European Scrutiny First Report


COM(00) 538

Draft Council Regulation on information provision and promotion of
agricultural products in the internal market.

Legal base: Article 37 EC; consultation; qualified majority voting
Department: Agriculture, Fisheries and Food
Basis of consideration: Minister's letter of 11 December 2000
Previous Committee Report: HC 23-xxix (1999-2000), paragraph 20 (15 November 2000)
To be discussed in Council: Following receipt of European Parliament opinion
Committee's assessment: Politically important
Committee's decision: Cleared


  12.1  At present, the Commission operates 12 promotional schemes for agricultural products, selected over the years by the Council. Each scheme follows its own rules, and falls into one of two categories: those run directly by the Commission, and those run indirectly through the Member States or trade organisations. According to the Commission, there is a need for this whole system to be simplified, and it therefore proposed in September 2000 that the existing schemes should be withdrawn, and replaced by a single scheme covering all promotion of agricultural products in the internal market.

  12.2  The main rationale behind the proposal was the belief that the Community can play a part in providing information of a generic character, thereby complementing, rather than overlapping with, the promotional activities of companies and national or regional authorities. It would thus concentrate on topics such as quality, nutritional value, safety, labelling and traceability, protected designations, and organic production. Programmes would be part-financed (50% on average) by the Community, and 20% by the Member State endorsing them, with the balance being met by the trade organisations proposing them. Under the proposal, Community budgetary expenditure would be 45 million euros (£28 million) a year.

  12.3  In her Explanatory Memorandum of 12 October, the Minister of State at the Ministry of Agriculture, Fisheries and Food (the Rt. Hon. Joyce Quin) pointed out that the UK had opposed the equivalent proposal relating to Third Countries on the grounds that it was not necessary for the Commission to spend funds on generic promotion. She said that similar arguments apply to the present proposal, but that, since the previous measure was adopted in spite of "sustained opposition" from the UK and some other Member States, it was not clear how much support the UK would find for opposing this latest proposal on the same grounds. She also suggested that the proposal to harmonise a number of existing promotional schemes could result in a more selective and targeted use of Community funds, though she warned that, since decisions on the sectors to receive funding would be taken under the Management Committee procedure, it would be necessary to try to ensure that these were not biased towards certain sectors or Member States.

  12.4  In the conclusion to our Report of 15 November 2000, we said that we shared the Minister's reservations about this proposal, as well as her unease over the potential consequences of the way in which the Commission envisages decisions being taken on the sectors to receive support. We therefore decided to withhold clearance, pending any further information which she could provide on this point, and on how the sum of 45 million euros envisaged by the Commission compares with expenditure under the Community's existing promotional schemes. We also noted that she had said that some Member States' trade promotional bodies, such as Food from Britain, had been consulted by the Commission, but that she had not indicated whether those bodies consulted within the UK were in favour of what is proposed. Again, we said we would welcome more information.

Minister's letter of 11 December 2000

  12.5  In her letter of 11 December, the Minister says that, in the discussion which has since taken place in Brussels, the proposal has commanded broad support, and is likely to be adopted as an A point at a subsequent Council (possibly this month).

  12.6  As regards our specific queries, the Minister says that the way in which the Commission takes decisions on the sectors to receive support is likely to involve a list of products and markets to be targeted being drawn up and agreed by Member States in the Joint Management Committee for the Promotion of Agricultural Products, where the UK's interests are represented. On the budgetary cost, she says that the Council has agreed that the 2001 budget for promotional schemes should be 47 million euros (£29 million), a fall of some 11 million euros (£7 million) from the 2000 budget, reflecting the reduced level of Community participation in funding promotional schemes under the proposal. However, she also points out that any potential savings would probably be cancelled out by the greater contribution which Member State governments will have to make to the expenditure on promotional projects within their own country. Finally, as regards the views of trade promotional bodies such as Food from Britain (FFB), she said that FFB does not consider generic promotion to be the most effective promotional tool, and would need to be convinced of the direct benefit to individual exporters of food and drink products of Community-wide promotional activity by broad product sector. However, she adds that, as an experienced provider of marketing services in Europe and further afield, FFB would wish to be considered in instances where British producers and their products could foresee potential gains.


  12.7  We are grateful to the Minister for this further information, from which we infer that there is no great enthusiasm for this measure within industry in this country, and that the concerns which the Minister herself expressed in her Explanatory Memorandum of 12 October about the difficulty of trying to ensure that expenditure under the proposal is not biased towards certain sectors or Member States have not really been satisfactorily resolved. Because of this, our earlier reservations — and we assume those of the Minister — remain, though we accept that this view may not be widely shared among other Member States and that there is little the United Kingdom can do at this stage to prevent the adoption of this measure. For that reason, and because the expenditure envisaged is, in Community terms, relatively modest, we are now clearing the proposal. We are, however, drawing its potential drawbacks to the attention of the House.

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Prepared 29 December 2000