It’s all down to the budget

For the past 18 months or so, when asked what is the most effective time to lobby in respect of the proposed reforms of the CAP, my reply has been “when the budget is settled”.   The draft proposals for reform of the EU Commission have been subjected to the most minute of public scrutiny and as a consequence of the Lisbon Treaty, the European Parliament is now one of the principal negotiating parties. 

When I last went into print on this matter the EU Parliament had issued 3,000 proposed amendments and this has now risen to over 7,000.  Many relate to the same issues and the Parliament will need to establish its common position on its objections before they can go forward. However, Parliament has also stated that it will not reach its common position unless and until the CAP budget is agreed.

The Euro crisis and the world economic position has resulted in many Heads of Member States demanding cuts in the EU budget for the period 2014 – 2020.  Recently published draft figures show that a 10% cut across the board would result in a decrease at just over €28Bn for pillar 1 and €9Bn for pillar 2.  If the direct payments of pillar 1 were to be ring fenced and the 10% decrease applied to pillar 2, this will apparently result in a 30% reduction in the rural development funds for the budget period 2014 – 2020.  The Commission argues that pillar 1 should not be set against pillar 2 but at the last General Affairs Council almost half the member states argued as the Commission has frozen the CAP budget in nominal terms implying a reduction in real terms and accordingly the CAP should be exempt from further cuts.  Now MEPs are threatening member states who continue to “demand cuts that they will exercise Parliament’s veto of any arrangement which threatens the effectiveness of CAP policy priorities.

Official sources state that the reforms will be in place by 1st January 2014 but this depends to a very large extent upon the budget for 2014 -2020 being agreed by the end of this year or at the latest by February 2013.  The Irish Presidency has already pencilled in a February summit if there is no agreement.  There remains huge differences of opinion both in the Parliament and in many member states and between the Parliament, the Council and the Commission.

The EU Parliament is saying let us wait and see what budget can be agreed then we will be able to better decide which policies can become effective, which will need to fall by the wayside wholly or in part and which of the two pillars will need to bear the brunt of any budgetary reductions.

Issues of agriculture are now very largely down to agreeing budgets but when?