CAP HEALTHCHECK: Position of Agriculture and Rural Development Committee of the European Parliament

Briefing Note ¹

October 13, 2008

Main Points

• Over one thousand amendments to the Commission’s proposals had been tabled by MEPs.

• Compromise amendments that addressed the main points of the Commission’s proposals had been negotiated ahead of a Committee vote.

• With the exception of one dealing with the Milk Sector these were all accepted.

Outline of Agreement

Modulation: The compromise they reached asks that the current 5 per cent rate of modulation for farmers receiving more that €5 000 in EU subsidy should only be increased to 7 per cent by 2013, rather than the 13 per cent proposed by the Commission.

A higher rate should be applied to farm businesses which receive over €100 000 but not as great as that suggested by the Commission:

• 1 percentage point extra modulation between €100 000 and €199 999 rather than 3 points;

• 2 points between €200 000 and €299 999 rather than 6; and

• 3 percentage points beyond €300 000 rather than 9.

Milk: a review in 2010

A compromise view was rejected but a series of individual amendments was adopted by the Committee.

• MEPs favour an increase in quotas by 1 per cent in 2009 and 2010, but they ask the Commission to review the situation in 2010 before making proposals for later years.

• MEPs also want to allow Member States temporarily to increase their quotas if the quotas of other Member States are under-used. 

• They call for the creation of a milk fund to help restructuring of the sector.

Hard-hit sectors, insurance and market intervention

Members States should be allowed to use up to 15% of their community funding envelope to support hard-hit sectors such as:

• livestock and dairy farming.

This should also be allowed to be used to contribute to insurance and mutual schemes (so-called Article 68 support)

• to widen insurance coverage, notably for all type of climate damage;

• for major losses caused by animal or plant disease; and

• to increase Community co-financing of these insurance schemes and mutual funds.

MEPS also voted to accept a series of amendments calling for the retention of market intervention or management instruments in the grain, meat and dairy sectors.

This information is extracted from Press Release CAP Healthcheck: consensus reached in the Agriculture Committee