Examination of Witnesses (Questions 831
- 839)
TUESDAY 22 MAY 2007
MR GERARD CESAR
Q831 Chairman:
First of all, Senator, thank you very, very much indeed for finding
the time to come and see us. You obviously know who we are and
how the House of Lords works. We are a sub-committee of our European
Union Select Committee. We are looking at the reform of the wine
regime, I think really for three reasons: firstly, it takes up
a lot of money, €1.5 billion; secondly, it is now looking
almost as one of the odd ones out of the regimes as many of the
CAP regimes have been reformed; and, thirdly, we are beginning
to get a wine industry of our own, so we have an interest.
Mr Cesar: (Through an interpreter) It is a pleasure
to be here. Just to introduce myself: before joining the Senate,
the Upper House, I was an MP with two mandates before they were
both interrupted by the Socialist Government in 1991 and 1998,
when I judged it more judicious to join the Senate. I have also
been a County Councillor and Mayor of my town, and also President
of the co-operative that you will be visiting tomorrow. I have
been in that co-operative for some 20 years. Much to my regret
I will not be able to accompany you to see my own, so to speak,
co-operative because I am going to have to attend a meeting on
the status of farmers and tenant farmers that is being held for
two days in Paris. I was working in my vines this morning, which
is why I have got my cuts! Why is the Senate interested in European
reform? Mainly because it is a very important reform for France
as one of the biggest wine producers in Europe, and Bordeaux is
the biggest in France. There is support for that reform and we
are favourable to that reform in principle. I do not want to mix
the cost aspects with the aspects of territorial development and
employment. I am the Vice-President of the Economics Committee
of the Senate and also the Chairman of the Sub-committee for Viticulture
within that overall committee. We have already had the opportunity
of welcoming the European Commissioner, Mrs Fischer-Boel, to the
area to explain to her how we feel about the proposals in the
reform. The sticking point is the contradiction with the proposals,
such as they are understood from Mrs Fisher-Boel, between grubbing-up
400,000 hectares of vines within the European Community and then
giving total liberalisation to planting. That is a contradiction
in terms that we find very difficult to swallow. There are roughly
200,000 hectares of vines planted in Spain and Italy without planting
rights. As an example, there is the region of La Mancha in the
south of Spain which produces wine solely for distillation and
it is unthinkable to carry on in that way. To our knowledge, Mrs
Fischer-Boel has on her agenda to submit her report to the European
Commissioners on 4 July. My plan is to produce my report by 20
June and consequently to meet with Mrs Fisher Boel to explain
my point of view.
Q832 Lord Plumb:
4 July is the report to the European Council, not to the European
Commission.
Mr Cesar: Mariann Fischer-Boel from Denmark
will be presenting that to the European Commissioners. It is to
the Commission, not to the Council. The Council of Ministers is
scheduled to meet on 16 July and by that time the Presidency of
the European Union will have switched from Germany to Portugal.
Q833 Chairman:
Anyway, let us move on.
Mr Cesar: Next week I will be working with my
Italian colleagues, having already taken all the necessary oral
evidence for my report, so you are getting first shot at these
proposals! To sum up very quickly, there are three thrusts in
my report: the issue of grubbing-up, the issue of savings on the
European scale and the question that we have already discussed
around the table—the destruction of distillation facilities
for by-products from wine, mainly the marc and the lees, that
distillation being financed essentially by Europe for reasons
of protection of the environment. Germany does not do it in the
same way as France. There are specialised plants in France for
that particular form of distillation of the residues, simply because
40 or 50 years ago the marc and the lees were not destroyed; they
were recovered by the growers, who put in a little bit of water,
a little bit of sugar, stirred it and came up with jug wine that
was a very strong competitor of quality wine elsewhere. Also,
you can get brandy. As you know, the production of these distilleries
for residues produce alcohol for industry, chemicals, pharmaceuticals
and cosmetics. I want to keep those facilities in operation so
as to make sure that the residue from the growing production of
wine is used sensibly, particularly bearing in mind the threat
of global warming. There is an important factor in maintaining
the existence of those distillation facilities. One cannot continue
producing wine solely for the purpose of distillation.
Q834 Lord Cameron of Dillington:
What do you think about the abolition of crisis distillation?
Mr Cesar: In answer to your question: Yes, I
am in favour of crisis distillation because, if there was no aid
from Europe, the distillation facilities would disappear and that
would lead to an inherent threat to employment. Again, it is a
throwback to the comparison with Germany. Germany has a wine industry
but it does not have the concentration of surface area planted
environments. It produces 10 million hectolitres of wine but does
not distil the residue. What does it do? It spreads it in the
field. My point of view is that, if you do away with the distillation
facilities, irrespective of employment, what do you do with the
residues? Imagine what it would be like if you took all the marc
and the lees from the 125,000 hectares just here in Bordeaux and
spread it over the neighbouring countryside; the tourists would
love it! There is a further advantage of maintaining distillation
facilities, whether they be private or co-operative. With alcohol
you can produce biofuels, ethanol, and this can be used mixed
in with or used as a fuel for the automotive industry. If you
do away with the distillation facilities, then say bye-bye to
the production of biofuels and ethanol.
Q835 Lord Cameron of Dillington:
From what you have said, you do not want to seem to encourage
the reduction of the surplus wine production in France. Surely,
we have to change and take some of these vineyards out and the
only way to do it is by a commercial tool which is the lack of
crisis distillation money and funding?
Mr Cesar: The answer to your question is; No,
I am not in favour of reducing the surface area of vines because,
if we did so, we would be faced with even fiercer competition
from Australia and Latin America. It is unthinkable that Spain
does not pull up vines, because it has 200,000 hectares of vines
producing wine, not for consumption but solely for distillation,
and those 200,000 hectares had no planting rights given, whereas
as a region Bordeaux produces AOC wines for consumption in the
export market and not distillation. There is a distinct difference.
Q836 Viscount Ullswater:
Would you consider that part of the budget for distillation should
be controlled by the Commission? Or should it form part of what
might go into the national envelope for each country?
Mr Cesar: From my findings I have seen that
the Commission has a definite tendency to pass the buck to the
national envelope under the principle of subsidiarity. I have
noticed that right across the CAP, the Commission passes it down
the line to the national envelope.
Q837 Viscount Ullswater:
Are you in favour of that?
Mr Cesar: No. If you do not counteract that
transmission down to the national envelope, what is the point
of having Europe? Why is Europe there if it just passes the buck?
It is all very well to have an open market and musts coming in
from Argentina and other countries being transformed into wine
in the European countries, but Europe needs to ensure that there
are the same conditions and criteria for production right across
Europe and, therefore, to reorient policy and money to the new
markets that are coming up: Russia, India and China.
Q838 Chairman:
Can I just check that I have understood what you are saying. As
I understood it, you started by saying that you believed a reform
of the wine regime was important and that the present system was
unsustainable?
Mr Cesar: Yes. That will be put in my report.
Q839 Chairman:
Then you mentioned three particular policy dimensions. They were
crisis distillation, which you believe ought to be supported?
Mr Cesar: Yes.
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