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The Agriculture Commissioner presented proposals to reform the fruit and vegetable sector which she said would help it to meet the challenges it faces from third country competition and pressure from the retail sector. The proposals focused on increasing the competitiveness of the sector, risk management measures and simplifying legislation. The Council held its first exchange of views on the proposal and I intervened in support of aligning this regime with the 2003 CAP reform model, but expressed concern that the proposed risk and crisis management measures should not distort the market. I also underlined the need for budget discipline.
The Commissioner also presented two proposals on the common organisation of the market in cereals: the first on the abolition of maize intervention and the second to deliver extra short-term cash to compensate for high interest charges. Only the first proposal was discussed. The Commission held that intervention abolition was the only way to rectify the current unsustainability of the maize market, although reservations were expressed by some member states. I welcomed the proposal, and its intent to tackle current market imbalances.
The topic for the lunchtime discussion was changed from the Presidency's work programme to consider possible solutions to the European Parliament's decision to place a reserve on 20 per cent. of the EU Rural Development budget.
The Agriculture Commissioner updated the Council on the state of play of the WTO negotiations following the world economic forum in Davos last week. She said that WTO members had agreed the resumption of DDADoha development agendanegotiations following movement from the United States on domestic support. She stressed that the EU offer from last October still stands. Some member states expressed concern at the readiness of key WTO members to show flexibility in response to that shown by the EU. I intervened to underline the UK's support for the Commission's negotiating tactics.
The Council took note, without discussion, of a written update provided by the Health and Consumer Protection Commissioner on the latest developments with regard to a case of Avian Influenza H5N1 in Hungary.
Austria, supported by 10 other member states, including the United Kingdom, drew attention to the impact on agriculture of the Commission's proposed strategy on soil protection and called for further subsidiarity. The Council will discuss this issue at its next session in March.
Cyprus drew attention to the serious consequences of drought for the agricultural sector in the Mediterranean and called on Council and the Commission to find ways of supporting affected farmers and supplementing their income.
Denmark, supported by eight other member states, expressed difficulties faced in implementing the cross compliance system and the need for clearer definitions of standards and legislation related to cross compliance.
Latvia, supported by six other member states, asked for the possibility of implementing the new, simplified, detailed rules for the Energy Crop Scheme in the new member states from 2007, rather than 2008 as proposed by the Commission.
Latvia, supported by five other member states, expressed concerns about new Commission guidelines on complementary national direct payments, which they fear will affect the overall financial envelope for, and scope of, payments which apply in the new member states.
France, Austria and Denmark called for Council to discuss the measures required to redress a persistent imbalance in the EU sugar market. The Commissioner announced that because of poor uptake of the buy- out scheme, a temporary quota suspension of at least 12 per cent. or 2 million tonnes would be needed this year.
The Parliamentary Under-Secretary of State for the Home Department (Mr. Vernon Coaker): I am pleased to announce that the annual report 2005-2006 and accounts of the Security Industry Authority (SIA) will be laid before Parliament and published today.