Examination of Witnesses (Questions 840
- 859)
TUESDAY 22 MAY 2007
MR GERARD CESAR
Q840 Chairman:
Grubbing-up, where you are not in favour of grubbing-up?
Mr Cesar: Not in favour, except for vines that
were planted illegally.
Q841 Chairman:
Get rid of the illegal ones?
Mr Cesar: Neither Italy, nor Spain, nor Greece
has the same virtuous approach as France, even with financial
aid.
Q842 Chairman:
For legally planted vines no grubbing-up?
Mr Cesar: No grubbing up.
Q843 Chairman:
Thirdly, the maintenance of the ban on new plantings.
Mr Cesar: It all depends on what producing areas
you are talking about. Just as an example, if you go to the Margaux,
you will find there is the possibility of planting an extra 100
hectares. There is a market and a demand for Margaux wines, so
why not give the right for planting in the Margaux area with the
approval of the CIVB.
Q844 Lord Plumb:
Do I take it that you are not in favour of the national envelope?
Mr Cesar: Yes and no: transfer to a national
envelope but the role of Europe is to serve as the co-ordinator.
Within that national envelope, to come back to my example, if
there is reason to replant 100 hectares in Margaux because there
is a demand and the export market is there, yes, OK. Just a further
point on grubbing-up: it behoves Europe to organise pre-retirement
plans for those growers who want to retire, and that would be
on a purely voluntary basis.
Q845 Chairman:
Would that be linked with grubbing-up?
Mr Cesar: Yes, and that would be temporary grubbing-up.
There is a distinction between a permanent grubbing-up, where
you lose all replanting rights, and temporary grubbing-up, where
you are just freezing the replanting rights for X number of years,
but it will always be under the aegis and control of the CIVB.
Q846 Lord Plumb:
Senator, is that on the basis of the figure which we had yesterday
of €240 per hectare on a temporary grubbing-up basis?
Mr Cesar: No, we are talking more of €600
from Europe and then the central government and regional government
would put money in the kitty as well. You have probably already
had this figure that has been more or less agreed between Europe,
central government in France, regional government and CIVB, that
within the Bordeaux region there are 10,000 hectares for grubbing-up.
For the first year that will be €15,000 per hectare and in
the second year, again based on a voluntary basis, it will be
only 2,300 hectares.
Q847 Chairman:
So we have voluntary grubbing-up and I think the Commission has
always based it on voluntary grubbing-up and grubbing-up, being
at the initiative of the producer?
Mr Cesar: Yes.
Q848 Chairman:
In that case there is not that much difference between you and
the Commission, is there?
Mr Cesar: First and foremost, right on the front
page of the report will be the grubbing-up of those vines that
were planted without proper planting rights and they are getting
the most money out of Europe for distillation.
Q849 Lord Cameron of Dillington:
But that would not be voluntary?
Mr Cesar: That obviously presupposes that there
is a political will at the level of the Member State.
Q850 Chairman:
Would you pay them to grub-up if they are illegal?
Mr Cesar: No. Perhaps the Spanish or Italian
Governments should be willing to pay.
Q851 Viscount Brookeborough:
Surely illegal plantations come outside the reforms and there
has to be another mechanism within Europe for dealing with the
illegal plantations. Secondly, I think you said very early on
that the lifting of the planting ban was contradictory. I wonder
if you could explain that a bit more because, if we did not have
crisis distillation, then that would not be contradictory, because
there would be no point in planting anything that was not commercially
viable. I fail to see why the two are contradictory. They only
remain that way if you go for crisis distillation, which keeps
the very people we are talking about in business. Lastly, you
have given lots of examples from Bordeaux but we have been in
Languedoc for the last two days and the situation is entirely
different, because there are many more marginal growers and many
more people who might be able to go out of business, be it early
retirement or any other form, with grubbing-up and so on. Could
you explain that?
Mr Cesar: When you talk about Languedoc/Roussillon
and what you call marginal growers, when they come to retirement
or because of grubbing-up, you need to have a retirement or pre-retirement
envelope to help those people and that will affect things like
the co-operatives.
Q852 Viscount Ullswater:
What you did not do in translating to the Senator was ask why
do you need a ban on planting if it is not going to be commercial
to harvest the grapes.
Mr Cesar: You have to plant when there is a
commercial market and, if there is no outlet, there is no planting.
Q853 Viscount Brookeborough:
Yes, but you can only make it commercial—
Mr Cesar: If there is no outlet, there is no
planting.
Q854 Lord Cameron of Dillington:
Who decides?
Mr Cesar: You cannot plant vines to distil.
Q855 Lord Cameron of Dillington:
Who is deciding, the plant grower or the state?
Mr Cesar: As you know, the OCM was first introduced
in 1999 and the next project is due to come into application on
1 August 2008. In the meantime we are going to have the 2007 harvest
and there are going to be measures put forward to growers between
now and 1 August 2008. I want to make sure what those measures
are going to be, and then it is back to grubbing-up illegal vines
in Spain, Italy and Greece, the necessity of maintaining distillation
facilities if they go out of the window and there is no crisis
distillation. But what happens when a crisis occurs and there
is no distillation facility available? You do not get any brandy,
is Europe there to finance alcohol for brandy?
Q856 Chairman:
Let me put another model, which is basically an economic liberal
model, which would be basically saying let the market decide;
and, if you let the market decide and have a market-led reform
by removing entirely crisis distillation,—so, if you do
not sell into the market, there is not something to fall back
on,—you abolish the ban on planting rights and those who
plant and get it right and are producing wine that the market
wants thrive and those who get it wrong go out of business. Possibly,
you have a grubbing-up scheme for a limited period in recognition
that you have to have a transitional period between a controlled
market and a free market. The one thing we have got to recognise
about people leaving the industry is that it will not just be
people retiring, there is a need surely to facilitate people leaving
the industry if (a) they are uneconomic and (b) they are producing
inferior wine—another definition of uneconomic—that
the market does not want to deal with?
Mr Cesar: Speaking as a liberal, a member of
the new UNP party, and not for a socialist regime—
Q857 Chairman:
And I am a member of the Socialist Party!
Mr Cesar: That is not a problem, people from
all colours and all horizons. Nonetheless, as a former trade unionist,
I am for the organisation of the market but not for leaving the
market free for everybody to do just anything. As a rapporteur
in parliament on the orientation of agriculture for the whole
of France, which encompassed the whole principles and problems
of CAP (that was six days and nights of parliamentary debate),
the question I would like to throw back to you is; what would
be the landscape in the countryside of Languedoc/Roussillon if
there were no longer any vines, if all you were left with was
land which would not even be eligible for subsidies from the CAP?
I agree with you that we very definitely need a transitional period.
Chairman: I do not know the details of
what would happen to the land but let me tell you what I think
the model of the economy would be. It seems to me that the economy
of Languedoc/Roussillon is incredibly dynamic in that the population
is growing very quickly, so that would indicate there are significant
economic opportunities there, and I would have thought that those
people who would be displaced from wine-growing could either find
their economic activity in other forms of rural employment or
translate into totally new jobs as a result of the buoyant economy
of the region.
Viscount Brookeborough: Can I just add
a comment, because I have been to the port region of Portugal
on several occasions and there, where vineyards have become uneconomic,
and they are on much steeper slopes where the roots have to go
down 40 metres to get water, where those vineyards have become
uncultivated, they have got scrub, they have got trees, they are
a haven for wildlife, they have not had the soil erosion that
people believed they would and it has become an environment for
people.
Q858 Lord Cameron of Dillington:
You mentioned that there are growing markets in the rest of the
world, and in Britain the market has been growing very fast over
the last decade or so. But why has France failed to capture this
market in the past?
Mr Cesar: It is simple. There is one example
in Bordeaux—
Q859 Lord Cameron of Dillington:
Bordeaux sells very well almost everywhere, but it is perhaps
the non-top 10% of wine that I am thinking of.
Mr Cesar: In answer to your question, taking
off the top 10%, mainly because of competition from the so-called
New World wines—Australia, South Africa, Argentina, Chile,
New Zealand, California. There they have big wineries with big
budgets and big money for marketing. When you come to the Bordeaux
region there is nothing in comparison, nobody has the financial
means for advertising, promotion and marketing. That is where
Europe has a role to play by helping the promotion, by expanding
its credits notably for exports, as I have already said, to new
emerging countries such as Russia, India and China. Concomitant
with that is to combat alcoholism. As you know, France has an
Act of Parliament called the Evin Act, which was brought in against
alcoholism. There is confusion in many minds between wine, which
is a foodstuff, and alcohol, which is not. The Evin Act has really
hit the wine industry in France; whereas you have youngsters who
do not drink wine, they drink alcohol, they take drugs, mix in
a bit of soda and are in hospital on Saturday night.
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