Wednesday, 19 November 2008

Outcome of EP vote on CAP health check

MEPs today gave their backing to the CAP health check. While the SNP backed the compromise deal that was eventually reached by the Parliament’s political groups, it was very much a “lukewarm thumbs up” from us.

All our amendments which passed the Agriculture Committee vote last month got through today and were incorporated into the Parliament’s position. These concern provisions on voluntary modulation, which will provide some clarity to how modulation will impact on Scotland’s farmers, making set aside a normal entitlement, including sheep, beef and goat payments in a single payment scheme by 2010 and establishing the principle that no adjustments in modulation must lead to lower general rural development funding. However, all our amendments on decoupling for sheep and beef and on deleting progressive modulation, as well as on retaining cross compliance as a tool against wildlife crime were lost.

So what was agreed by the EP?

Modulation: the Commission is proposing to amend the modulation rate from its current 5% to 13% by 2013. The EP wants the rate to increase to only 7% by 2013. MEPs want farmers who receive subsidies of less than 10,000 euro per annum to be exempt from modulation, which currently applies to all farmers who receive more than 5,000 euro. MEPs also want to see the extra funding that is released from the increase in modulation be used to finance more challenges than those identified by the Commission (climate change, renewable energy, water management and biodiversity) and that this money shouldn’t be co-financed by national budgets as is currently the case for rural development programmes.

Dairy: The Commission is proposing to increase Member States’ milk quotas by 1% per marketing year until 2013-2014. Ceilings are to be abolished completely in 2015. The EP agreed to a 1% annual increase in quotas until 2013-2014, but asked the Commission if the situation could be reviewed in 2010 and for new proposals to be made before the end of the quotas if necessary, i.e. before they are abolished. MEPs also called for the creation of a milk fund to help restructure the sector.

Decoupling: EP amendments mean that coupled aid (linked to production) will be retained until the end of 2012 in sectors such as fodder, protein, flax as well as sheep and beef sectors and the tobacco sector.

Support for hard-hit sectors, insurance and market intervention: Other amendments adopted would allow Member States to use up to 15% of Community funding they receive to support hard-hit sectors such as livestock and dairy farming and to contribute to insurance and mutual schemes (Article 68 support).

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