Examination of Witnesses (Questions 1
- 19)
WEDNESDAY 4 JULY 2007
Ms Sonia Phippard, Mr Andrew Lawrence and Mr Simon
Harding
Q1 Chairman:
Good morning. Thank you very much for coming today and helping
us with the very start of this inquiry into the future of the
Common Agricultural Policy. It seems as though it is almost every
year we have a session on the future of the Common Agricultural
Policy, but progress is being made. This is an evidence-taking
session. There will be a transcript distributed to you afterwards
for you to have a look and see whether it is accurate. Would you
like to start by making any initial comments?
Ms Phippard: I was not particularly planning
to make any initial comments, except perhaps simply to update
you. We provided you with a written note of Defra's current position
and view in response to your questions. Since we finalised that
there has been a little more progress in the sense that the June
Agriculture Council concluded decisions on the reform of the Fruit
and Vegetables regime. The Portuguese Presidency has made a start
by confirming that they want to get ahead and, if they can, to
complete reform of the Wine regime within their presidency, which
is ambitious but an excellent ambition. The Commissioner has confirmed
that her timetable for the immediate next steps, the so-called
Health Check, will indeed be to publish a public consultation
paper in the course of the autumn. There will obviously be some
discussion at the Agriculture Council, but what she is very keen
to do is to engage citizens, certainly public opinion in general,
in terms of the immediate future of the CAP. It is likely that
the consultation document on the EU Budget Review will be published
early in the autumn and that will probably begin to ask some questions
and to give some flavour of the longer term, although obviously
I can only speculate as to the precise content. The process continues
to move, hence our active engagement with it.
Q2 Chairman:
Looking forward to 2020, what do you see as the defining characteristics
of the CAP? What would it look like? What would its main features
be?
Ms Phippard: My hope, and the UK's hope, is
that the CAP would be in some ways broader but also better focussed
than it is at present. At the moment it tends to be defined largely
by the money it spends, which is not tremendously effective or
healthy, although it has very understandable effects on behaviour.
I would hope that by 2020 it would be defined much more clearly
in the minds both of the European Commission and also of farmers
and the public by the outcomes that it is seeking to achieve.
It clearly continues to be a series of regulations which enable
the Single Market within the EU for agricultural products and
delivers to the citizen the things that really matter around food
safety and food security—the supply of food—but it
is also focused on the other outcomes that are important from
farming, the so-called public goods, environmental public goods,
and also the enhancement and protection of our rural areas. That
means that the financial flows will be very much focused on those
public goods. The UK's ambition by 2020 is of it being entirely
focused on those public goods, many of them environmental but
not necessarily exclusively so, and with a suitable balance and
framework between any national funding that may exist at that
stage.
Q3 Chairman:
If the exclusive focus would be on public goods in terms of financial
flows, what elements of the CAP would fall away?
Ms Phippard: Essentially the present Pillar
I and all its works. In other words, payments which are exclusively
income support and the market measures which also form part of
Pillar I,—intervention, export subsidies and price support
of various kinds.
Q4 Chairman:
That is a very ambitious objective. To get there, who are your
friends?
Ms Phippard: We have quite a number of friends,
surprising though this may seem.
Q5 Chairman:
Apart from the Treasury!
Ms Phippard: We have friends within the United
Kingdom, of course. Overseas there are now a number of other Member
States who are looking at a pretty radical reform of Pillar I,
some who have been long-standing friends and friends of reform—ie
the Swedes and the Danes. The Germans are pretty clear that further
reform is needed. They are currently engaged in a very active
internal debate between the Federal Government and the Lander,
but it is reform-oriented. The former Dutch Minister had published
a paper setting out his views, but there is no doubt that the
Dutch government is looking for further reform. The list also
includes some of the Baltic states, the Estonians and Latvians—the
Latvians have published a document—and some of the other
new Member States, the Maltese and the Czechs. There are a number
of other Member States who, I think, without necessarily going
quite as far as us, would definitely support the enhancement of
Pillar II at the expense of Pillar I. In other words, they see
the value of moving the funding much more clearly to targeted
public goods rather than across-the-board payments.
Q6 Lord Bach:
Can I remain general and really follow on from what the Chairman
was asking you. You talk about progress towards the abolition
of direct payments and the end of the Single Payment Scheme. Can
you just enlarge a little bit on that? I presume and hope that
it is Defra's policy that those direct payments will end in due
course? When do you think direct payments as such, whatever they
are called, will end?
Ms Phippard: As you know, the Defra-Treasury
paper aims for a target end-date of between 2015 and 2020. If
I look at statements from the Commission, on the face of it, in
an agriculture context, it is likely to be at the latter end of
that window, because there are quite a lot of Member States who
would see the next Financial Perspective, 2013 to 2020, as a transition
period. That is in the Agriculture context. However, the major
debate on financial issues will happen in the context of the Budget
discussions, which will be at the Heads of Government and Finance
Minister level. Where I hope we and most other Member States would
be entirely at one is that, as they look at the financial pressures
on the CAP, the public goods element of the spend (ie Pillar II
as it currently is), they will see it is far better value than
Pillar I. I would hope that the pressure from that angle will
be to bring Pillar I down while protecting, and indeed potentially
enhancing, Pillar II. As to how fast that will move, I am not
sure it is for me to speculate.
Q7 Lord Bach:
Is it not important that it moves pretty quickly? Is it Defra's
present policy that we should lead the way towards that happening
pretty quickly or that we should be in a pack of well-wishers
and just go along with them? That is an important decision to
make. Up until now I think we have had a reputation with our European
colleagues, sometimes good, sometimes not so good, of being prepared
to be way out on this, hopefully to lead the others to the Promised
Land. What is your view?
Ms Phippard: I think we will continue to lead
the debate. I think it is only us and Sweden who have said unequivocally,
with a timescale, that Pillar I payments should come to a complete
end and we will continue to do that because it is abundantly clear
to us—and our economic evidence every time reinforces this
message—that Pillar I is simply not good value for money
for anybody. Equally, there are still demands which potentially
we are not meeting either at EU or national level on the environmental
and public goods side. There are great benefits from moving ahead
with change. We have said, and we remain clear, that that has
got to be done over a manageable timescale, but we will be pressing
for ambitious decisions in the context of the Health Check, the
Budget Review and all other discussions that happen. We would
hope for some very firm and clear decisions in that series of
discussions over 2008/09 and probably the first couple of years
of the new Commission.
Q8 Lord Bach:
You say in your document that the good things about cross-compliance
do not outweigh the huge cost there is under Pillar I and direct
payments. Just expand on that a bit. There are other ways of doing
the environmental good works other than Pillar I, are there not?
Ms Phippard: Yes. Cross-compliance has two elements,
the first of which is simply obeying the law. It is quite clear
that cross-compliance in its first year, from the work of our
own Environmental Observatory and others, has helped to sharpen
focus on obeying the law because it adds an extra sanction. Nevertheless,
that is the law and it is inspected, regulated and enforced. The
second half is more obvious value added, the good agricultural
and environmental condition, but it is at a fairly basic general
level. Certainly within England what we have seen as the major
way of going beyond that is our entry-level Environmental Stewardship
Scheme and we have currently structured that scheme so that we
have a spectrum, with cross-compliance as the very basic level
and then entry level stewardship. We are looking to encourage
the vast majority of farmers or at least the vast bulk of land
within that scheme. That is one obvious way. The other is looking
at law enforcement and other more specific incentives.
Q9 Chairman:
That is a bold way forward that you have outlined to us. Do I
take it that the Territorial Administrations have signed up with
equal enthusiasm to that objective?
Ms Phippard: I think the Territorial Administrations
would join us in the direction of travel. The `Vision' paper was
published by Defra and the Treasury; it was not a joint document.
We have some very new Territorial Administrations and so I think
it would be rash of me to speak for them in detail, but we work
very closely with them. We do not have differences in the basic
direction of travel. We might have some differences in nuance
and probably in speed.
Q10 Lord Cameron of Dillington:
You told us who your friends were. But, probably because we ought
to actually hear evidence from them, who are the enemies on the
Continent?
Ms Phippard: Probably the most vocal is France,
as a very significant beneficiary of the CAP, but they, too, have
their range of allies. Of the new Member States, Poland is probably
the leader, with Hungary as well. Among the other older Member
States, the Irish are conservative on a number of things, although
not everything. But on spend they are. Luxembourg, Austria, Greece
and Finland for geographical reasons are also conservative.
Q11 Lord Cameron of Dillington:
The Commission refers to the `European Model of Agriculture'.
I think I know what it means and I suspect the words `family farm'
occur several times during any definition of it. Perhaps you might
like to comment on that. In what way do you think the economic
and maybe social conditions have changed in the last ten years
and may be continuing to change, hopefully, regarding the structure
of the countryside and the rural economy which is going to make
the job of implementing your policies easier?
Ms Phippard: Just on the European model of agriculture—interestingly,
it does not mention the `family farm'. Any joint EU Ministerial
discussion tends to bring those words out. One of the points that
we tend to make is that the family farm itself is an immensely
variable feast. There are some extremely large, efficient family
business farms in lots of parts of Europe as well as, it has to
be said, the rather small ones. The European model talks about
versatility, sustainability, competitiveness, and it also talks
about the continuing process of reform. I think the one aspect
of the European model where we tend slightly to pause is an emphasis
on agriculture happening everywhere in the EU. I think we would
say where that makes environmental and market sense rather than
inevitably. Coming on to your second question, we have seen a
number of changes in the last ten years. One is that EU agriculture
has been influenced, albeit probably with a rather slower, dampened
effect, by global trends much more than by its own protectionist
framework. We have seen the impact of global price changes, global
markets, et cetera shaping European farming to a much greater
degree and that has been obvious in farms tending to increase
in size, whilst the number of those employed in agriculture has
generally been falling. There is a real enthusiasm on the part
of farmers in much of the EU to be market orientated. "Stop
telling us to be market orientated, that is what we want,"
is something we hear quite a lot, and that is not just a UK phenomenon.
There is a real appetite to respond to the market. In a number
of cases that has fed through into strong farmer support for things
like decoupling payments. We await with interest to see whether
that will happen in those parts of the EU where governments have
insisted on retaining coupled payments. The other thing that has
happened within the last ten years, which is more EU-orientated,
is Enlargement, which has further extended the versatility and
the variety of models. It has taken us back in some ways to some
of the challenges that the EU 15 faced earlier, because we have
some very, very large numbers of non-sustainable farm "businesses"
in a number of the new Member States. We have that extra challenge.
On the other hand, we have a larger market and a lot more players
who are looking for the competitive model that is going to enable
them to survive.
Q12 Lord Greaves:
Can I just pick up on that question of the new Member States and
the restructuring that is needed? If you take a longer view, people
used to talk about going into the Common Market and inefficient
French farmers. Farmers in the Paris basin are no more inefficient
than farmers in East Anglia, perhaps less so. A huge transformation
took place in France with the rural reorganisation, which really
predated the CAP in many ways and the whole place was transformed.
That kind of reorganisation needs to take place in Poland and
Bulgaria and some other places. It is going to be very expensive
and somebody is going to have to pay for it. How does that fit
in with CAP reform?
Ms Phippard: I would say it fits very well.
The evidence is pretty clear that across the board Pillar I-type
payments are not the way to achieve that. Pillar I-type payments
tend to stultify and slow down structural change because they
give everyone a comfort zone in which they sit. Also, decoupled
payments tend to result in people continuing to do what they have
always done, whereas a greater focus on Pillar II, particularly
in those cases, the Axes 1 and 3, payments for farming innovation
and for more major rural development and restructuring, seem to
us to be two useful levers, but frankly, so, too, are some elements
of European policy outside the CAP. The UK has made it clear that
we would see those Member States as major recipients of structural
funds because of their rural problems. They have far too many
farmers, but the problem goes way beyond farming. There is a major
skills issue. There is a major question of where the populations
sit and so on. So the quite substantial sums that are and will
flow to them under structural funds are important to them.
Q13 Lord Plumb:
There are two parts to my question, one of which is to do with
food security. There is a lot of confusion over food security.
I am sure the commercial farmers have told you how important it
is. Secondly, there is confusion over how European agriculture
is going to fit into the competitive pattern which we are already
facing and what part they should play in that, recognising what
is happening in Brazil and China and various places where they
are exporting large quantities of food at a price way below our
cost of production. On the food security point, in your paper
of December 2006 you say "Food security should not be confused
with national security, which is a pure public good. Food itself
does not have `public good' characteristics." I fully accept
that self-sufficiency makes little sense. In today's international
world we have to face competition as it is. As we see the reform
of the CAP and support many of the measures that are being proposed
at the moment, how is that going to fit in? The structure of farming
will change. The structure of agriculture right through Europe
will change. There may be closer ties between agri-business and
the farming community as we see the development of the marketing
of products and so on. Those really are my two concerns which
I think need clearing up, because of the confusion that obviously
exists. We are not just talking about food, of course, we are
now talking about fuel. You will know that at the Royal Show the
buzz word in the whole of the show was fuel rather than food,
as we see that development taking place.
Ms Phippard: Let me reiterate what we said certainly
in both that December paper but also in the `Vision'. It is quite
important that food security is not confused with either self-sufficiency
or national security. The UK, and indeed the EU, have relied very
heavily on effective trading relationships as part of our food
security for many years. The Second World War obviously, in those
particular national security circumstances, challenged that. Current
assessments of national security issues—and food is an essential
of life—indicate that maintaining secure and stable trading
relationships and enhancing those are absolutely key to our food
security and our fuel security as a nation. That said, we do indeed
recognise that the liberalisation of trade has impacts on who
produces what and where. We have done quite a lot of analysis
already of what those impacts are likely to be and we are continuing
to try to enhance and take forward that analysis and to share
that with our counterparts around Europe. It is worth emphasising
again that Europe, in food trade terms at the moment, is pretty
much in balance. If you do it in euros or pounds, we export a
lot of high-value-added products. We import quite a lot of commodities,
some of which we cannot produce here, some of which we could but
do not. By and large, as we look ahead, that continues to be the
pattern against a world where we will face more competition from
cheaply produced commodities but where the global population is
growing and the global demand for the high-quality, high-value-added
type of products that the EU produces is also growing. However,
that is an enormously across-the-board picture and not much comfort
to the individual sector or farmer. So below that we are trying
to make sure we do understand and can discuss with both farming
interests here but also the rest of our European counterparts
what the more detailed impacts will be, whether there are consequences
which—probably not, frankly, from a food point of view but
maybe from a rural policy point of view—would lead to a
drastic change in the rural economy in a particular area or environmental
impacts.
Mr Harding: I think one of the most important
points that our paper made was that, if you are interested in
food security, then you need to realise that there are a huge
variety of threats to our food security and food supplies and
that only some of those threats are of a nature that would make
it helpful to actually grow lots of food on your own sovereign
territories. There is not really a very direct connection between
how much food you grow domestically and the level of security
that you attach to your supplies of food. There are a great many
other influences, such as energy supplies, logistical systems,
the possibility of terrorist attacks, et cetera. There is a long
list which is enumerated in that paper. The second point to make
is about the data itself. We have published figures of about 60
per cent for what we call food self-sufficiency and about 70 per
cent for self-sufficiency in what we call indigenous products,
such as things that we typically grow in Northern Europe. Those
figures are calculated on the basis of shares of value. It takes
account of the prices of the products that we are buying. Obviously
there is a huge mix of food products, including a lot of processed
products, things to which a lot of value has been added beyond
the farm gate. That is not really the same thing as our nutritional
requirements. If you were to look at our nutritional requirements
and ask the question! Are we going to starve or feel hungry? The
answer to that would be a great deal different and the relevant
figure would be a great deal higher. If you take into account
the problem of obesity and over-eating, you would probably say
that we were 110 per cent self-sufficient at the moment. That
is for the UK and the situation is even more favourable for the
EU as a whole, from where we get most of our food imports at the
moment. Unless we are cut off from Europe, then the UK is at least
as food secure as Europe is. As far as European food security
is concerned, in the sense of purely growing the stuff, the estimates
that have been made of the probable impact of radical trade reform
suggest a wide range of possibilities, but most of the studies
seem to indicate that changes in the output of European agriculture
could be less than 10% and could be between 10% and 20% and is
less likely to be any more than that. If you apply those levels
of changes to what we already produce, you do not get an alarming
picture of moving into a marginal food supply.
Q14 Chairman:
Do you not think you are likely to run into an argument from supporters
of Pillar-I type payments? The argument would be along the lines
that we live in a dangerous world, we have climate change, we
do not know what the impact of climate change is going to be,
we have the strongly emerging economies in the Far East and China,
with food consumption likely to go up. So, it might be argued,
in those circumstances should we not play it safe and put food
security at the top of the list and, in order to do that, protect
Pillar I payments? Do you see that as an argument that you might
have to confront?
Ms Phippard: It is an argument that we have
to confront. There are a number of arguments advanced for protecting
Pillar I but they nearly all centre around either the view that
in certain parts of Europe farming might stop if you took it away
or you have to safeguard in some way the present pattern of European
agriculture. The response to that is that the pattern of European
agriculture has changed, is changing and will continue to change.
Pillar I has had some impacts on it, most of it not tremendously
helpful because in a number of cases it has encouraged over-production
of the wrong things (hence the sugar reforms that we are rather
painfully trying to go through at the moment) rather than helped
to support food security as defined by those who take that line
of argument. Yes, the argument will be presented. I think the
other response to it is that, if you are seriously looking at
food security in a European security sense, let us look at the
value of Pillar I payments against all the other things that we
are doing to spend on European security. I would push the argument
gently towards the Budget Review, where we need to look at all
European spend and the outcomes that Europe is trying to achieve
and ask whether seriously maintaining Pillar I simply on that
basis would make any sense either absolutely or relatively.
Q15 Lord Plumb:
Are you concerned about the balance of production? I am in danger
of talking about British agriculture and the Chairman will be
very angry with me if I do. Let us look at it in European terms.
We are seeing quite a measure of change at the moment. Three herds
are going out of production every week for instance. The milk
supply situation is desperate. The cost of feed going into those
animals is increasing. That is not just a British problem, that
is a European problem. My own worry is that we see that getting
totally out of balance and that is not going to be of interest
to the consumers in European countries.
Ms Phippard: I think the answer would be `yes',
at a quite high level. That is why we set up the Agricultural
Change and Environmental Observatory, which is looking at what
is happening here, particularly focused on England, to try and
make sure that within our own shores we are aware of changes and,
if there are trends which are worrying for any reason, we can
spot those. The big balance question at the moment, it seems to
me, is the one that is prompted by the fuel debate, where there
are a variety of issues. There are the people who estimate that,
if we were going to produce all our fuel as biofuel, or a large
proportion of it, then the whole of Europe would become a mass
production of non-food crops. That has all kinds of downsides.
Hence the UK's very firm view, which I think is shared across
Europe, is that, as we look at the fuel alternatives, we need
to be very, very clear both about looking for the most efficient
sources of them, which may not be European, and at the environmental
impacts of those sources. There are also concerns about the impacts
in developing countries if the biofuel market does well and, therefore,
rather as we heard some years back, about niche crops displacing
essential production for feeding of the local population. The
same concerns apply to biofuels. As responsible world citizens
we have to keep a pretty clear eye on all of that. So responsible
purchasing and doing everything we can through our broader energy
and biofuels policies to make sure that we purchase in a responsible
manner which does not have adverse social and environmental impacts
is vitally important.
Q16 Lord Greaves:
I am old enough to remember the Second World War and the 1940s.
In those days every scrap of food was consumed and yet nowadays
there is huge wastage. When we talk about the level of production
and over-production or whatever, production for what? There is
a vast amount wasted that the supermarkets will not accept because
it is not the right shape of carrot or whatever it is. It is said
that people waste 50% of the food that they buy, as it is then
thrown away. People do not seem to eat half of the food that goes
on the plates nowadays. We were all taught to eat up every last
scrap, which is why some of us find it difficult keeping our weight
down. Is not the presumption, which I suppose has been there in
public policy ever since the Corn Laws were abolished 175 years
ago, that food should be as cheap as possible and that the whole
of competition policy and all the rest of it should be geared
at getting it to be as cheap as possible? Is there not a basic
flaw in that at a time when so much is wasted? How do we marry
up these different things?
Ms Phippard: I do not think that, from a public
policy point of view, I would argue that food should be as cheap
as possible. I hope I will not get shot by any fellow members
from elsewhere in government for saying that. I think what we
should argue is that food should be affordable for all and that
public policy which simply adds costs to food without benefit
cannot be sensible. Equally, there is a good argument for enabling
the market to recognise things like the full environmental cost
of the production of food and making consumers more aware of that.
At the moment there are environmental costs which are not reflected
in consumer prices. There is a lively debate beginning around
whether that is right and whether there are markets which should
be developing that to take account of that kind of value. I think
the answer is that we should not be asking consumers to pay for
the costs of a policy which does not deliver those goods. Artificially
inflating prices has done nothing to help handle that over-purchase
and waste. This is a very real challenge both in terms of helping
consumers to understand the rather complex thinking around sustainable
consumption but also looking at how markets function in terms
of environmental costs.
Q17 Lord Greaves:
By historical standards food prices are incredibly cheap now.
We are not paying for all sorts of extra things, are we?
Ms Phippard: Within Europe we are still paying
twice over for the Pillar I aspects of the CAP. I do not think
removing that will make a vast difference one way or the other
to consumer behaviour. I think the way you tackle consumer behaviour
is a different thing. I do not think inflating food prices through
the CAP, even if we were to do it to a ludicrous extent, would
be a very good way of influencing consumer behaviour. For most
European citizens food is still a relatively low proportion of
their total budget. Perversely, however, it is in the very poorest
parts of Europe, mostly the new Member States, where food still
is a very significant proportion of the budget. Those are probably
the areas where healthy, accessible, safe food is still a much
bigger need. It seems to us that having a policy which has perverse
effects on price cannot be right.
Q18 Viscount Ullswater:
I am going to take you back to structures, if I may. You argue
very strongly, both in your paper and today, for the phasing out
of Pillar I payments. As we have seen in some other regimes, do
you think there will be a pressure from Member States to have
part of that payment funded by what I think in the wine regime
they call "national envelopes"? I am just wondering
whether there is a pressure for national envelopes to be developed
and whether that will have a direct impact on EU competition policy.
Before I leave that, I wanted to go a little bit into Pillar II,
where your evidence indicates that there are going to be 94 new
Rural Development Programmes. Is that right?
Ms Phippard: Yes.
Q19 Viscount Ullswater:
Is that not going to be costly? Will that really benefit the rural
community? It certainly will not benefit the consumer of food.
If that is the case, this huge number of policies and perhaps
the development of national envelopes, are we not really repatriating
agriculture back to the Member States? Your comments please.
Ms Phippard: In terms of the phasing out of
Pillar I, there are a number of different ways in which people
may call for national spend. The Dutch certainly have floated
the idea of co-financing. Some are doing rather more what you
were suggesting, going for more traditional State Aids, ie purely
national financing. Our view on co-financing would be that it
is something of a red herring when it comes to Pillar I. It does
not seem to us that it is a particularly helpful step on the way
to reducing Pillar I. If you are going to keep an across-the-board
Pillar I with the same rules for everybody, then the theory that
brings co-financing into Pillar II does not apply. While I do
not think we would automatically say "no, never", we
would very much want to understand where on earth it fitted in.
At the moment it is not very obvious to us that it is a logical
step to take. On the question of State Aids—ie purely national
spend—to replace, Pillar I-type support, again we would
very much query it as a replacement to Pillar I because why give
income support to some or all farmers in a certain Member State?
We would need to be absolutely clear it was not anti-competitive.
At the moment the State Aid rules certainly would not allow it.
In a simpler CAP world, where the payments were focused entirely
on public goods, then I imagine we would need to revisit the current
State Aid rules which reflect the large sums of European money
that go in. Either way, I am not attracted to the prospect of
State Aids replacing Pillar I. As you come to Pillar II-type measures,
it seems to me that the arguments are slightly different. I think
there is a question of making sure that we look at Pillar II against
your entirely well-founded concerns about bureaucracy, and that
we should not be funding at a European level from a taxpayer point
of view or forcing through a European level of bureaucracy and
inspection and enforcement things which should be entirely down
to Member State discretion. As long as activities are proper public
good which do meet competition and State Aids rules, if we go
that way for certain types of activity, which may currently be
either within Pillar II or on people's wish-lists for Pillar II,
allowing state aids is something we should think through. It is
an entirely reasonable area to explore and really to work out
what should be done at EU level and what should be done at national
level. As for the 94 Rural Development programmes, the UK is guilty
of four of them, because we have one each for England, Scotland,
Wales and Northern Ireland. Germany has Lander and Spain has 17
Provinces. That is how we get to 94. Each one is actually reasonably
large and obviously has a measure of regional integrity which
would be defended vigorously either by the Scots, the Catalans,
the English or whoever. I think that allowing that measure of
regional segregation is not a bad thing. One of the things we
have argued about Pillar II is that it does need to be flexible
and locally responsive. Clearly in the UK we have very much welcomed
and taken full advantage of the ability to use regional flexibility.
However, one of the things we will certainly be wanting to address
with other Member States and the Commission as we look forward
is how we can simplify Pillar II, not only what is in there (we
have got to have only the right things in there) but some of the
rules around it which are complex. We are pretty confident there
is scope for some simplification as we go forward. We have made
one step within England, in the Entry Level scheme, something
which is much simpler than a traditional Pillar II measure—at
least we hope so—at the application and paying agency levels.
But looking at the scope for rather simpler approaches within
Pillar II and some of the bureaucracy around it is one of the
things we very much want to do. Our experts have been a bit distracted
by jumping through the hoops of getting in the present Rural Development
programme, so we are rather at the beginning of that. But we certainly
intend to do it.
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