House of Lords
A "SCANDALOUS WASTE OF MONEY"
SAYS LORDS' COMMITTEE
|Saturday 12 April 1997|
European Community subsidies for
tobacco farming are a scandalous waste of taxpayers' money. This
is the main conclusion of a report by a House of Lords' Committee,
Every year the Community spends huge
sums supporting the production of a product which is harmful to
health and which is of such poor quality that most of it can only
be sold, at rock-bottom prices, to less-developed countries.
Tobacco producers receive an average
80 per cent of their revenue for tobacco by way of subsidy. Some
varieties depend for their production on a subsidy that is 99
times the purchase price.
Tobacco is grown mostly in Italy,
Greece and Spain, often in poor, underdeveloped regions. Over
the years tobacco subsidies have been seen as a way of propping
up small farms which would not otherwise be economically viable.
But the Committee concludes that this does them no favours, since
producers remain trapped in a sector with no real long-term prospects.
Pressures from the World Trade Organisation, and the implications
of new members joining the Community, mean that subsidies cannot
continue at present levels for long, so a new approach is needed.
The Committee calls for a phased
reduction in subsidies, combined with financial incentives to
tobacco producers to look for other livelihoods. Regional development
programmes and the provision of infrastructure would also help
to put the economies of tobacco-growing areas on a more sustainable
Lord Reay, Chairman of the Committee,
"The tobacco sector is a hole
in the ground into which the Community is pouring money with no
thought for the future. We recognise that, for many tobacco growers,
subsidy is the main source of income, but that can't go on indefinitely.
Sooner or later things must change - and the process will be
less painful if it is sooner. The money would be better spent
in helping to create other economic opportunities."
NOTES FOR EDITORS:
The Committee's enquiry was occasioned
by EC Proposal 5217/97 (COM(96) 554) which is the Report from
the Commission to the Council on the common organisation of the
market in raw tobacco.
MEMBERS OF THE SUB-COMMITTEE WHO
CONDUCTED THE ENQUIRY:
Lord Brain, Viscount Brookeborough,
Baroness David, Lord Gallacher, Lord Gisborough, Lord Grantchester,
Lord Moran, Lord Reay (Chairman), Baroness Robson of Kiddington,
Lord Stodart of Leaston and Lord Wade of Chorlton.
ENQUIRIES: Miss Mary Morgan, Information Officer. Tel: 0171-219 0671.
Fax: 0171-219 6715.
Mr Dominic O'Shea, Tel: 0171-219 3346.
THE EC TOBACCO REGIME
13th Report Session 1996-97, HL Paper 73, £7.00,
ISBN 010 407397 7.
Published by The Stationery Office and
available fromThe Stationery
Office Publications Centre, PO Box 276, London SW8 5DT; Telephone
orders 0171-873 9090; General enquiries 0171873 0011;
Fax orders 0171-873 8200.
|© Parliamentary copyright 1997||Prepared 12 April 1997|