Labour Euro-Safeguards Campaign - Bulletin September 2008


QUESTIONS AND ANSWERS ON THE CAP AND THE CFP

  1. Which two EU policies probably have the least support of all in the UK?

    While it may be the case that British membership of the EU is still supported by about a third of the British electorate, there are two EU policies which even this Europhile minority regard as beyond the pale. These are the Common Agricultural Policy and the Common Fisheries Policy. Both these policies have been unremittingly bad for the UK, damaging for the EU as a whole, and a major disaster for the Third World, especially those countries which are least developed and most vulnerable. How did Britain ever get involved in policies so detrimental to our domestic and international interests and so undermining of everything that we ought to be doing to help poor countries, especially in Africa?

  2. How did the CAP come about?

    The Common Agricultural Policy (CAP) was from the beginning one of the bedrocks of the Common Market. It was essentially the product of a deal between the French and the Germans as the six original member states came together during the 1950s. In return for German industry gaining access to the French market, Germany agreed to support high agricultural prices in France. The French government at the time was desperate to keep unrest on the land under control and believed that subsidising French agriculture to whatever level might be required to head off trouble was the best way of doing this - especially if other countries could be made to pay the bill. Indeed, it is now well documented that the major reason why de Gaulle kept Britain out of the Common Market for as long as he did was because of fears that, if the UK was involved in shaping its basic institutions, the French vision of the CAP might be undermined. By the time the UK joined in 1973, the CAP was so well entrenched that there was nothing that could be done but to accept it as it was.

  3. What was the origin of the CFP?

    The Common Fisheries Policy (CFP), by contrast, did not exist until it suddenly materialised during the negotiations for Britain's entry into the Common Market in 1972. Britain's negotiating position was extremely weak, as the established Member States were well aware, as they began to realise that our negotiators had been told to accept whatever terms were available. It was for this reason that, late on, as deadlines for completion of the talks were at hand, it became apparent that an additional price for Britain's membership could be extracted from us in the form of giving all other Common Market countries access to our rich fishing grounds, which were far larger and better stocked than theirs. The CFP was thus established, to which the UK was forced to acquiesce, as a mechanism for creating an extra benefit for all other member states at our expense. It was simply an extra last minute cost to us for joining the Common Market.

  4. What are the major problems with the CAP for Britain?

    The CAP has been a huge problem for Britain domestically ever since we joined what was then the Common Market. Its initial effect was to give a significant boost to inflation as the British farming support system, based on the consumer paying for food based on world prices, was replaced by much higher CAP prices. This was a highly regressive policy as lower income people spend a much higher proportion of their incomes on food than those who are better off. It has also been extremely expensive for the nation as a whole. The extra 20 a week which every four member family in Britain has to spend on food is reflected in the huge net payments which the UK makes to the EU every year, rising from an estimated 4.7bn in 2007 to as much as 6.8bn by 2013. The biggest single reason why these net payments are so high is because Britain pays so much for food while getting so little back from the CAP support regime. Nor has the cost of the CAP to Britain been just financial. Its subsidy system has done severe damage to the countryside by encouraging prairie style farming methods which involve tearing up hedges and destroying natural habitats while doing little to help the poorer farmer.

  5. What are the major problems with it for the EU?

    Nor has the CAP done anything for the EU as a whole. The flows of money which it engenders are indefensible. In every country, the main beneficiaries are large agribusiness and people who are already super-rich rather than those farming on a smaller scale. Between countries, those that receive the highest subsidies, particularly France, Denmark and Ireland, are those with much higher standards of living than the average. Poor administration and bad management has led to huge sums of money being wasted or misappropriated, much of it as a result of wholesale fraud and malfeasance. The CAP still accounts for as much as 40% of the EU's entire budget, thus distorting all its other priorities.

  6. And internationally?

    It is when the impact on the Third World is considered, however, that the full awfulness of the CAP is revealed. French intransigence over CAP reform was largely responsible for the lack of success in the most recent Doha round of trade negotiations. The result is the pernicious impact of the CAP on developing countries will continue. There are two major problems. The first is that the very high tariffs which the CAP imposes on food imports - often 100% or more - make it impossible for poor countries to develop agricultural production for export and especially difficult for them to export processed food. This denies them all the advantages of export earnings, increased investment and productivity from which they could otherwise benefit. In some ways just as bad as this is the second major impact that the CAP has on the Third World, which comes from its policy of dumping surplus food on world markets. This drives down prices making it more and more difficult for farmers in poor countries to make a living.

  7. What about the CFP?

    While the fishing industry has always been of less significance to the British national economy than agriculture, it has always been a proud part of our heritage and provided an important component of our food supply. It is therefore exceptionally sad that the impact of EU policies on the CFP has been proportionately even worse -and by a substantial margin - than the CAP. Before we joined what was then the Common Market, Britain had the huge advantage of being solely responsible for the well being of our fisheries and having the right to the catch over a large area of some of the richest fishing waters in the world. Once all the sea surrounding Europe became an EU resource, everything changed. Instead of being conserved, as happened in the seas surrounding countries such as Norway, Iceland and Greenland, our waters were plundered by subsidised fishing fleets from other EU countries, particularly Spain. With rules rigged against our fishing fleets, the number of fishing boats operated from the UK tumbled, while many species of fish were almost exterminated, largely as a result of inappropriate, cruel and wasteful regulations, particularly over the use of quotas and the treatment of young fish. Meanwhile, having fished out much of the sea surrounding the European land mass, EU fishing fleets are now driving fisherman out of business in poor countries in Africa by the same over-fishing techniques which have been so damaging in their own home waters, often made possible by one sided agreements with regimes in too weak a position to resist unfair pressure to make concessions.

  8. Why is there no reform in prospect?

    Why is so little being done to remedy these problems? It is not because they are not widely recognised to exist in Britain. The main reason why reform is such a distant prospect is that the structure of the EU makes it extremely difficult to stop vested interests - particularly, in these cases, French farmers and the Spanish fishing industry - defending their privileges, however irrational and undesirable they may be. In the opaque horse-trading atmosphere of EU politics, it is almost impossible to muster the political determination and the voting power to make the radical changes which are so badly needed. Because both the CAP and CFP are perceived as largely British problems - however baleful their influence on the EU and the Third World may be - and we are in a small minority when it comes to voting, we have no effective leverage to get any changes made.

  9. What should Britain do about this situation?

    So what can we do? The answer is that within the institutional framework of the EU as it stands at the moment we are largely powerless. Despite all the pressure which has been put on other Member States, fundamental reform of the CAP is nowhere on the agenda. As part of the settlement on the EU's budget at the summit held in Brussels in December 2005, it was hoped that radical changes might be made in return for the big increases in contributions to the EU which Britain conceded. In fact, nothing more was achieved than a vague promise to consider making changes which France is certain to insist on watering down or to block completely. Instead, the existing framework is very unlikely to be altered significantly at least before 2013, in accordance with a deal stitched up by France and Germany, to which Britain at the time acquiesced, as the price to be paid for enlargement. Serious reform of the CFP is even less probable. No other Member State in the EU has any interest in seeing their involvement in Britain's traditional fishing grounds diminished whilst sectional fishing interests, particularly in Spain, are in much too strong a position to enable environmental considerations to garner votes for reform, although in any rational world they certainly would do so. The plain fact is, therefore, that as long as we remain in the EU we are stuck with both the CAP and the CFP, with all the damage they do to Britain, the Third World, the environment and to the EU's reputation generally. Does anyone think that this is an appealing prospect or one which can do anything other than worsen the food price crisis which now affects millions of people?

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