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EU scales back on its generous agricultural subsidy regime

Historic talks designed to give the EU's much-maligned common agricultural policy (CAP) the biggest overhaul in its 40-year history began on Wednesday with signs that France may, for the first time, be willing to sanction change.

The policy has become a byword for greed, waste and fraud and with ten new countries due to join the EU next year, officials know that its generous subsidy regime must be scaled back if the EU is to stave off bankruptcy.

It has been reformed before but the latest attempt by EU farm ministers in Luxemburg aims to do away with production-linked subsidies, the regime's most controversial element.

According to the French press, Jacques Chirac told his German counterpart Gerhard Schroder before yesterday's talks that Paris -- which has one million farmers to appease -- was willing to see some, but not all, of the policy's production-linked subsidies scrapped from 2006.

It was unclear Wednesday night which of the proposed changes they were willing to accept.

The reform proposals on the table would ensure that milk and wine lakes remain in the past, and would do away with the production-linked subsidy regime altogether.

Future subsidies would instead be conditional on farmers respecting the environment, animal welfare and food safety.

Some, but not all, of the protectionism which campaigners say is responsible for pricing out poor farmers in the developing world would also be dismantled, and the surreal practice of paying EU farmers to leave their fields fallow would be scrapped.

But campaigners argue that Franz Fischler, the EU agriculture commissioner who drew up the proposals, should have gone further.

"The CAP reform on the table stinks of industrial agriculture," said Joanna Dober of Friends of the Earth Europe.

"If you take off the green wrapping (of the agreement), inside there is a black hole, meaning nothing for the environment and nothing for the poor."
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