Select Committee on European Communities Eighteenth Report


Creating a competitive EC agriculture

  95.    EC agriculture must reorientate to compete in world markets without protection. In failing to prepare the industry for this situation Agenda 2000 is a disappointment (paragraph 64).

  96.    Compensation payments must be degressive and time-limited if they are not to frustrate and delay structural adjustment (paragraphs 65-6).

  97.    Modulation of compensation would further impede the restructuring of EC agriculture (paragraph 67).

Rural environment

  98.    Agriculture, like all industries, should operate within a basic regulatory framework which protects the environment and this should apply across the Community. It should ensure that those who damage the environment are made to pay for remedies (paragraphs 69, 76).

  99.    Policy and appropriate funding are needed to secure rural environmental goods which the market alone will not provide. Policy must ensure that such goods are provided in the most effective manner and at least cost (paragraphs 70, 77).

  100.    We support the Commission's intention to simplify policy, but the same approach is needed at Member State level. Support for the environment should be offered via a single menu. We advocate an horizontal, prioritised approach which ensures that the most valuable environmental goods are funded first (paragraphs 71-2).

  101.    Some environmental goods benefit the entire Community, others are much more local. There should be several sources of decisions and funding. Co-financing should apply where there is a benefit to the Community as a whole. The primary source for funding should in general be Member States or regions. Funding should be based on environmental merit, not on geographic area (paragraphs 71, 74-8).

  102.    Environmental payments must not be production subsidies in disguise. Decoupling is important for WTO acceptability and to ensure real environmental benefit (paragraph 73).

  103.    Monitoring must be strengthened to prevent fraud, to ensure that schemes represent environmental value for money and that they are fully decoupled (paragraph 79).

  104.    There are arguments in favour of cross-compliance, but stronger arguments against. There should be a synchronised process of reducing production-related compensation payments and building up an environmental policy justified by its own merits. We note the current wide difference in funding for agri-environmental measures on the one hand and the production regimes and compensation payments on the other (paragraphs 80-2).

Rural development

  105.    Rural development policy must seek to ease the social and employment problems which result from the continued decline in agricultural employment as well as from wider changes in the rural economy. The contribution which policy can make depends heavily upon the performance of the economy as a whole (paragraphs 83, 87, 94).

  106.    The development of alternative economic opportunities must be supported, including aid for small-scale enterprises, conversion of redundant rural buildings to new business uses, on-farm diversification and new technology skills training (paragraphs 85-6).

  107.    The national planning process has an instrumental role in rural development (paragraph 93).

  108.    We welcome the proposal to use funds from the Guarantee section of FEOGA to support an horizontal rural development measure, provided it is flexible enough to support off-farm, non-agricultural development (paragraphs 89-90).

  109.    We support bottom-up approaches to development and note enthusiasm for the LEADER scheme. Rural development requires expertise, as exists in the Rural Development Commission. It is important that this expertise is not lost in the move to regional development agencies (paragraphs 89, 91-2).

  110.    There should be no presumption that savings produced by CAP reform should automatically be used in other ways in rural areas (paragraph 90).

  111.    The test of success of rural development policy is that after a time it becomes unnecessary. We recognise that the time period will vary according to location throughout the Community. This must not distract from the fundamental need for the policy to be temporary (paragraph 94).


  112.    The Committee considers that the rural development and environmental aspects of Agenda 2000 raise important questions to which the attention of the House should be drawn, and makes this report to the House for debate.

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