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Mr. Brian Jenkins (Tamworth): I congratulate my right hon. Friend, first, on completion of the long, frustrating negotiations and, secondly, on the degree of success that she has achieved. We may not have gone all the way, but we have gone at least part of the way. I am particularly pleased with the reduction of support prices for butter and rice, which brings them closer to world prices. However, did the sugar regime stay intact? If the Secretary of State wishes to make a statement on the website, will she ask the French Government if she can use theirs because, apparently, the Opposition buy every single word on that site.

Margaret Beckett: I take my hon. Friend's point entirely. I am grateful for his welcoming of the reduction of support prices, and I would not disguise from him or the House the fact that we would have liked to see them go deeper and further. The sugar regime was not discussed at all in the negotiations and therefore remains as it is, but that does not mean that it is set in stone for ever. We anticipate discussions on outstanding regimes

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such as sugar starting around September. The Commission will bring forward proposals about that time.

Tony Baldry (Banbury): At present, every cow in Europe receives about $2 a day in subsidy; what will be the subsidy for each cow following the agreement? What in the deal is less trade distorting, and what will give developing countries an incentive at Cancun to sign up to the Government's agenda on new issues and to the general agreement on trade in services? Unless we can deliver on agricultural reform, there is no incentive for developing countries to sign up to the developed world's agenda at the World Trade Organisation conference. Unless we can secure a significant reduction in subsidies for such things as EU cows, there is no reason why the developing world should co-operate with the World Trade Organisation.

Margaret Beckett: First, it will soon be impossible to answer the hon. Gentleman's question about the average subsidy per cow in the European Union, because once payment is no longer linked to production, it will not be as relevant. It will be for the individual farmer to decide how to optimise market opportunities and what that means for the balance of livestock. The hon. Member for Brecon and Radnorshire (Mr. Williams) raised the issue of abandonment—he asked so many questions that I fear I may not have answered that one. We are all conscious of the fact that, once payments are decoupled from production levels, the question of abandonment may arise in some areas of some member states. However, we believe that the flexibilities allowed through the national envelope will enable countries, including ourselves, to address that problem if need be.

It is entirely right to recognise these as important issues to be set alongside other new issues at the trade talks. Discussions on matters other than agriculture are in the pipeline, and we retain the hope that agreement will be reached before Cancun, which will help to move things forward. The issues of market access, how we handle exports and so forth will come up in Cancun—and quite rightly so.

Mr. Ian Cawsey (Brigg and Goole): May I add my congratulations to my right hon. Friend on the huge effort that she has put into these matters? In common with other hon. Members, I hope that this will be a new dawn for agriculture—that would be appropriate because it seemed to take until dawn to reach agreement. The move away from production subsidies is welcome, but does the agreement allow—as did the initial proposals—for subsidy on land to remain, dependent on its historic use based on a three-year time frame? If so, what steps can the Secretary of State take to assist the many farmers in my constituency who farm unsupported crops and now fear that they may be undercut by other farmers who may switch to their crop and keep an historic subsidy?

Margaret Beckett: I am grateful to my hon. Friend for raising that point, which I know is a source of anxiety. In fact, I can tell him that there will be an EU-wide ban on people taking such steps, so I hope that that reassures him. We had some reservations about whether it was the best method to tackle what is unquestionably a problem

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that needed to be addressed. It may appear to be a more minor matter for negotiation, but it is very important for those concerned.

Sir Archy Kirkwood (Brecon and Radnorshire): The statement is important and welcome, and the Secretary of State was generous enough to acknowledge that it was a team effort. It is good to know that the constituent nations and legislatures can work so well together. I should like to ask two brief questions. First, is the 80 per cent. modulation payback guaranteed, because some voices were raised late last night that the 80 per cent. is not all that it seems to be? Is it an unqualified return figure of 80 per cent.?

On degressivity post-2007, some people are slightly concerned that the EU Commission has a unilateral right to fix the rate and increase the degressivity. If that is not the case, it would greatly help some of the farmers in my constituency if the Secretary of State could make that clear.

Margaret Beckett: First, I am grateful to the hon. Gentleman for his remarks. Secondly, how the 80 per cent. figure was arrived at is a little complicated, but as far as I am aware, there is no substance in suggestions that that will not be the net effect and outcome of the package. Finally, on degressivity and financial discipline, agreement was reached between member states and the Commission that strong financial disciplines were necessary and that some broad guidelines should be set down. As and when such trigger mechanisms should arise, further discussions are necessary on the matter.

Mr. Michael Jabez Foster (Hastings and Rye): May I congratulate my right hon. Friend on achieving for the first time for a long time a level playing field—at least in the medium term—for British farmers? Some member states might use national envelopes to provide unfair competition. If it became necessary, would the Secretary of State find something for our own national envelope?

Margaret Beckett: As always, there are restrictions on what use can be made of national envelopes. Throughout the working out of the agreement, the Commission tried to ensure—it will be considered in the legal text—that people do not use the freedoms and flexibilities available to them to create an uncompetitive environment or to undermine competition across the single market.

What often does not come through clearly enough when we get embroiled in the detail is the fact that we have secured a totally new structure for the CAP where the default option is that the support available is not coupled to production levels. The hon. Member for Brecon and Radnorshire raised the issue of abandonment. It is a matter of genuine concern for every member state—albeit slightly different concerns for each member state—but we have sought to build in enough flexibility to enable all to tackle those problems. The core of the new CAP is now different—totally different—from what it was before.

Mr. Mark Francois (Rayleigh): I appreciate the fact that agreement was struck only in the early hours of this morning, but I want to ask the Secretary of State what

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plans the Government have to communicate the details of the agreement to individual farmers—ideally, in a format that would allow them fairly quickly to work out what the precise implications will be for their individual businesses. I am sure that she will appreciate that farmers, including those in my constituency, will be anxious to know what it really means for their bottom line. How do the Government intend to provide the information to enable them to work out the implications in as timely a manner as possible?

Margaret Beckett: The hon. Gentleman makes an important and valid point, for which I am grateful. I can tell him that a great amount of work is now going on about how precisely to do so. He might like to ensure that the farmers in his constituency realise that nothing will happen before the end of 2004 or the beginning of 2005. Some may have preferred us to go a little earlier, but at least it gives us more time to get all the substantial administrative changes in place and to get the detail right. Farmers have time to assess their own options and to take their own decisions. One objective that we hope to achieve is stability for long-term planning for farmers and for their investment.

Geraint Davies (Croydon, Central): I give my right hon. Friend my complete congratulations on the considerable progress that has been made. However, will she make clear in Mexico in September what the real prize of decoupling subsidies from production is? Apart from the benefits that will be felt by consumers, small farmers and the environment, the real prize is that countless thousands of lives in the developing world will be saved as millions of people are lifted out of abject poverty. The decoupling will also remove a breeding ground for resentment that is being exploited by the proponents of terror. Will she make it clear in Mexico that the aim is not simply to create a fairer world by removing appalling trade distortions but that it is in everyone's long-term interest that we achieve a harmonious world by securing collective success and pushing forward relentlessly on this agenda?


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