Stephen Cadogan: Trivial aid measures won’t rescue farming and food sectors

The EU spends about one third of its budget on ensuring an affordable supply of food.
Stephen Cadogan: Trivial aid measures won’t rescue farming and food sectors

When EU leaders meet today to sign off a €540bn package of economic aid for the Covid-19 stricken continent, they will be aware that the farm and food sector should be high on the priority list.

In this regard, Irish Agriculture Minister Michael Creed must be commended for his role in leading a 27- member state response to an eye-openingly poor performance last week by the EU Commissioner for Agriculture, Janusz Wojciechowski.

The industry was understandably shocked by last week’s announcement by Commissioner Wojciechowski that there was no extra money for intervening in markets, in order to help farmers and the food industry.

The EU spends about one third of its budget on ensuring an affordable supply of food, but the commissioner said it has no funds left, even as a Depression-era recession threatens to devastate demand for food, in a market already completely disrupted by the lockdown.

The food industry will be affected as badly as any other sector by the grave risk to 59m jobs in Europe, over 25% of EU jobs, in the form of reduced hours, temporary furloughing, or permanent job loss, predicted this week in a McKinsey report.

First to react to the suggestion of no EU funds to combat the threat to the sector was Mr Creed, and his officials, who succeeded in garnering the support of all 26 other farm ministers — a considerable achievement in view of how disunited the EU has been so far in its response to the pandemic.

It was while addressing the European Parliament’s agriculture committee that Commissioner Wojciechowski said there was no “sackful of money” he can dip into.

There was an understandably strong reaction from MEPs, including Ireland’s Mairead McGuinness, who said: “We see crisis and chaos on the markets. Coming to the Comagri and saying ’I have no money’ is simply not enough.”

Committee chairman Norbert Lins (Germany), told the Polish commissioner: “Be brave and use your possibilities like PSA, you have our support”.

The commissioner has been far from impressive, admitting that farmers are fighting for survival, but able only to come up with trivial aid measures, such as extending the deadline for applying for direct payments, reducing farm inspections, promising to deliver some farm payments a few weeks early in October, and allowing pandemic relief spending from rural development funds allocated in 2015, and not yet spent.

He said some €6bn of rural development funds was uncommitted yet to rural projects by member states, and there was €17bn, if committed but unspent funds were included.

It might be a big help for the commissioner’s own country, Poland, with €3bn uncommitted, but is just another trivial gesture for other member states.

Ironically, his European Parliament speech was such an eye-opener that it may have been just what was needed to galvanise EU political leaders in the sector.

It was quickly (compared to the usual EU snail’s pace of developments) followed by reports in Brussels of countries uniting to put pressure on the EU to better protect the food sectors, led by Irish officials collecting the signatures of 27 agriculture ministers.

This was confirmed last weekend by Mr Creed saying he had won the support of all 26 of his counterparts for a joint statement which was submitted to Commissioner Wojciechowski by Ireland on behalf of all member states.

It called on the commission to facilitate measures such as aid for private storage, and exceptional aid for farmers, in the most affected sectors; and readiness to introduce further measures as necessary.

It called for a “continued strong and co-ordinated European response that demonstrates to all our citizens the vital role that European farmers and the wider agri-food sector have to play in the response to Covid-19, as well as the strength of the CAP in supporting food security, environmental protection, and vibrant rural areas”, and that demonstrates “the readiness of European farms to cope with the Covid-19 crisis as well as other present and future challenges, including climate change and biodiversity loss”.

The statement is in tune with the emerging feeling at the top in the EU that more needs to be done, faster, with European Council president Charles Michel this week voicing his regret that Europe’s way of working is “too slow”.

He admitted that it took “a few days” before member states shared the same diagnosis of the pandemic crisis, and a few more after they adopted decisions made at the first leaders’ teleconference on March 10.

He has warned that EU leaders today should agree on the broad strategy for spending the agreed Covid-19 economic aid package, rather than argue over how to finance it, an issue which has divided leaders since the pandemic struck.

He said the €540bn economic aid package approved already by member states’ finance ministers and by EU institutions, is sufficient to cope with current needs, but he left the door open to adopting further economic measures if needed before the next EU seven-year budget kicks in, expected in January at the earliest (member states have been arguing over the seven-year budget since it as first proposed one year ago).

With €540bn on the way, why did Agriculture Commissioner Wojciechowski warn of no extra money for intervening in markets, in order to help farmers and the food industry?

Maybe the feeling in the commission is that the sector must bail itself out, while the money is spent in other needy areas. However, if that is so, European council president Charles Michel looks like a powerful ally for food and agriculture.

In the context of the seven-year budget, he said this week that the EU’s Green Pact and Digital Agenda are important, but he also picked out cohesion priorities and the Common Agricultural Policy as priorities, saying it will be important, more than ever, to invest in solidarity, cohesion and agriculture, in order to guarantee convergence and European sovereignty.

The industry was shocked by last week’s announcement by Commissioner Wojciechowski that there was no extra moneyfor intervening in markets, inorder to help farmers and thefood industry

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