Examination of Witnesses (Questions 920-931)
Lord Rooker and Mr Robin Manning
25 JULY 2007
Q920 Viscount Ullswater: Do you think
there is any chance of getting them to drop that particular issue?
Lord Rooker: I will leave Robin to answer that
because he is hot from the "war front".
Viscount Ullswater: It does seem to be
such a peculiarly inappropriate thing to be so firm on, when so
many of the northern European states have been using sugar. Of
all the people at the moment, it is going to be southern Italy
and Sicily.
Q921 Chairman: Before Robin does
answer, when we were over in Brussels we interviewed the German
representative and he was very laid back and relaxed about it.
His view was that it always comes in, it always starts off as
something to do and it is knocked down—it is there to be
knocked down.
Mr Manning: I think that would be our view as
well. There is so much opposition to this. It is seen for what
it is: it is just a crude mechanism to try and use extra grape
juice, and it does not really take account of the fact that what
we want is a wine industry which is market-oriented and responds
to commercial opportunity. Just to answer your point on the RDR
question, the first thing I would say is that we do not think
that the ban on sugar will last the negotiation. That is our starting
position. However, if it did, then the sorts of programmes which
are being talked about would be introduced under Rural Development
plans, and it would be for Member States to take a view on whether
or not this is the sort of thing that they would want to invest
in. But, given the small amount of money which is going into Rural
Development, as we have already said, I would think it would probably
not be high on the list of priorities for any Member States to
decide to spend money on that when most of the issues that they
are concerned about relate to maintaining the social and environmental
fabric of wine growing in their countries. So we would be looking
primarily, I think, at agri-environment rather than investment
money of this nature. However, that is not to say that it would
not happen; the whole purpose of RDR—and this is why it
is match-funded—is that it is for Member States to take
their own national decisions on things that they want to spend
money on, albeit that they have to pass the Commission's test;
they have to make sure that they are compatible with the regulation
and that their plans are appropriate and are passed by the Commission.
Q922 Baroness Jones of Whitchurch: We
have already touched a little bit on the issue of labelling and
we received compelling evidence, I would say, from some of the
New World producers who had designed the labels on the bottles
to respond to what they felt the consumers wanted to know, and
their market share is evidence of how successful that has been.
Do you think that the Commission is missing a trick here, with
its reformed wine classification still having the link between
quality and geography? Are they missing a trick? Are we still
being stuck in that old-fashioned route, which actually most consumers
do not understand, and we are still mystifying the labelling far
more than we should be doing? Is there an argument for saying
that people should be able put whatever they like on the labels
as long as it is truthful and honest—just those very basic
things, which is what you would get on most packaging of food
or drink?
Lord Rooker: I think you are right there. As
I say, we are very supportive of the Commission's proposals. We
are a bit disappointed in the way that they seem to imply embodying
the existing geographical pre-requisites remaining on labels.
If one takes the English consumer, as the one I know, we have
had a phenomenal increase in the consumption of wine but no one
is going to say people in this country are wine buffs—part
of the cognorcent; of wine-drinking. They have embraced it as
alternatives to beer, lager and spirits. However, what they want
is clarity on the labels, as you say. If people go into a pub,
they do not walk in and call for a glass of French wine by the
location, and all that sort of thing; they will ask for a glass
of Chardonnay or a glass of Sauvignon. They want it clear; they
do not want the label cluttered up. In a way, one has only got
to look at the contrast of the labels between New World and what
has happened in France and, also, in Spain, to see the difference.
I know we have got the brands of Champagne and Bordeaux, and all
that, but that is slightly different to the thousands of others
across Spain, Germany and France. So they have missed a trick,
to an extent, and they have got to learn that this regime is not
for the producer, it is for the consumer. If the consumers carry
on as they are, when you look at the figures, Europe is the biggest
importer of wine, the biggest consumer of wine and, at the moment
still, the biggest exporter of wine, but it is on a downward path.
We will carry on being a big consumer, I am sure of that. We would
like to carry on being the biggest exporter, but we will lose
that if we cannot export to countries because of the lack of clarity
and simplicity. We think they all go and need an A level in how
to understand wine, and that is nice, if you want to do that,
but the average punter will not do that, and that is what they
have got to get more into. Some more work needs to be done on
that, I think, with the Commission; they need to be taken on one
side and explained. I think they understand the facts of the situation—certainly
looking at these documents—I do not think there is any doubt
in the Commission. But they are trying to make a major change,
so they are trying to bring these old-fashioned, conservative
producers along with them. It is their culture, it is their heritage.
One has to think of what happened and not say to people: "You're
stupid; you've been wasting your time; you don't know what you're
doing." You cannot use that kind of language to them; you
have got to be a bit more sophisticated about it. But they have
missed a trick, in some ways, by sticking to those prerequisites
on the labels. We will try and correct them in the negotiations
because they are only tinkering with the system at the moment—with
what the proposal is, really.
Q923 Lord Palmer: I ought to declare
an interest as the recipient of a Single Farm Payment.
Lord Rooker: You have got it then?
Q924 Chairman: He is Scottish!
Lord Rooker: Oh dear!
Q925 Lord Palmer: It is, however,
proposed to bring vineyards and, indeed, grubbed-up vineyards
within the ambit of the Single Farm Payment. Some could regard
that as a step in the right direction in that it will bring the
Wine CMO closer to the 2003 CAP reforms and perhaps encourage
some wine-growers to diversify. Of course, not every wine-grower
is able to diversify, as we are aware. But is it not also arguable
that the Single Farm Payment is just another subsidy which will
go to profitable as well as unprofitable wine producers?
Lord Rooker: That happens now with the Single
Farm Payment. The one good thing about the Single Farm Payment,
of course, is that it is decoupled from production. There is a
big advantage in some ways in bringing all land that is producing
food and drink into Single Farm Payments to get clarity within
the system. As you implied in your question, anyone with a vineyard,
if they grub it up, can use the land and get a new entitlement
under Single Farm Payments. If there is an existing vineyard (and
one takes the English situation that we are in now) which would
not be in a Single Farm Payment (most of them are quite tiny),
the only way they can get a new entitlement—because the
entitlements are all fixed from 2005—is to grub-up the vineyard,
and there is not much sign of anyone wanting to do that; it is
the opposite way round. However, they can buy entitlements under
the trading system of Single Farm Payments, and they can, of course,
if you like, swap the fields around, if they want to replant,
because obviously all our farms are fairly mixed. The Single Farm
Payment is there for the foreseeable future. It is not tied to
production of the goods (to that extent it is a benefit) and,
secondly, to obtain it you have got to conform with cross-compliance
and the other rules. I understand about 50% of the vineyards probably
do already comply across Europe. However, there is an overall
benefit for it as far as we can see. It is not giving Single Farm
Payments for existing vineyards, so it is not new in that sense.
There is no new entitlement created; the entitlements are fixed,
and the only way you can get a new entitlement is if you grubbed-up
the vineyard and did not replant it somewhere else—but that
is not likely to happen to us.
Mr Manning: If I can just clarify one point
on that, as far as the grubbing-up scheme is concerned, it is
subject to the same threshold as the planting ban, so in the UK
the grubbing-up scheme would not apply because we are under 25,000
hectore-litre. However, Lord Rooker is absolutely right, in any
other country the only new entitlements which are being created
by the wine reform occur where the farmer is actually undergoing
a fundamental change in land use and, effectively, going out of
wine production.
Q926 Chairman: At some time in the
relatively near future we may be asking you about the future of
the Single Farm Payment, but we will leave that for the moment.
Lord Plumb: We look forward to that!
Lord Rooker: I am quite happy to talk about
Single Farm Payments; we have done very well this year compared
to last year, but we still need to do a lot better and we expect
to do better next year.
Chairman: I think we are just wondering
how far into the future we will have Single Farm Payments. Never
mind—do not go there now! A last question, appropriately,
from Lord Moynihan.
Q927 Lord Moynihan: The way
ahead. It would be very helpful indeed if you could give us an
indication of the status of some of the negotiations. You might
want to elaborate a little bit further on that and on how you
see them coming to a conclusion on the timing and content. We
are conscious of the fact that there was some opposition to the
Commission's proposals at the Agriculture Council last week. I
just wondered if you could give us some indicators as to how you
see this all playing out.
Lord Rooker: Certainly you will get much more
detail on that from Robin. Basically, we are very supportive.
We want it completed as soon as possible. There will be no delay
from our point of view, but obviously there may be rearguard actions
from other Member States, as we have implied, I think, from what
has been said this morning. Negotiations have started in the Wine
and Spirits Working Group, and I think we have finished for July
now and we will start again in September. I am in no position
to say whether they would conclude in the current Presidency;
the Portuguese want to make as much progress as possible and we
want to give them every support, if it can be concluded. As I
say, from our point of view, we do not want any delay. Obviously,
it goes with the seasons as well, from that point of view. I do
not know quite when it would kick in once it is agreed because
then you have got the growing seasons—but as soon as possible.
Q928 Lord Plumb: Will it be settled
before the sugar regime?
Lord Rooker: No, I am not going into sugar.
I think that would be highly dangerous of me, at the moment.
Mr Manning: I can expand on wine—not on
sugar, unfortunately. We have really just started the process.
We have had six days of working groups in two-and-a-half weeks,
so we feel quite shattered, actually, because it is really hard
going. We are only about 50% of the way through the first reading
of the document and, while we have touched on some controversial
issues, such as the planting ban and the grubbing-up scheme, we
have not even considered things such as wine-making practices
or enrichment, which I think will be equally difficult. The Presidency
have tabled another five days of working groups through September,
and I think the aim then will be to have completed the first reading
and for the Commission to take a view on the comments which have
been received and decide where they think they can move on certain
areas, where they feel that the points which Member States are
making are right and there is the clarification necessary. There
will be a further level of technical discussion but, ultimately,
where we have a dossier as difficult and as important as this,
it will be settled at a political level. Whether that is possible
in December in the final Portuguese Council, I do not know; that
will be the aim—to try and get political agreement then.
Whether that is possible, as I say, there is a lot of divergence
of opinion between, let us say, producers and non-producers, in
terms of the way forward, over really fundamental issues, such
as what you can put on a label and what you cannot put on a label.
Should producers be allowed to take an economic decision and grub-up
their vines? Or do they have to stay in production even though
they are not going to be economic? Should we constrain the industry
from growing and responding to market opportunity? Or should we
just allow uneconomic producers to stay in production and go bankrupt
because they no longer receive market support? How will we define
the GIs and the PDOs, the new system of authorisation of varieties?
So there is a lot of work to do. It is a very challenging dossier
but, actually, very interesting as well. We have submitted an
Explanatory Memorandum where we have tried to bring out some of
the issues as well for your consideration.
Chairman: When we all set out on this
we did not know a great deal about it. As the Minister said, we
are more interested in the consumption side than the production
side. The more all of us have got into it, however, it is an absolutely
fascinating area and crying out for reform.
Q929 Viscount Ullswater: One further
point: is the de minimis rule being negotiated at
all—the 25,000 hectore-litre? Is it being considered to
move that up a tiny bit? It might help the UK industry.
Lord Rooker: Obviously, I have not been party
to the negotiations. Certainly from our point of view we want
that raised.
Q930 Viscount Ullswater: Is that
part of the negotiations, strictly speaking?
Mr Manning: The whole of that is to be negotiated,
and the 25,000 hectore-litre appears in two articles of the regulations.
On both sides we are saying that we want that up substantially—at
least double—as part and parcel of our agreement to allow
the planting ban to be extended to 2013. We could not really have
one without the other.
Q931 Chairman: I do not know if you
wish to say anything in conclusion?
Lord Rooker: Thank you.
Chairman: Thank you. Three-quarters of
an hour!
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