Parliament adopted a report relating to the direct support schemes and support schemes for farmers relating to the set aside for 2008 and 2009. The European Parliament debated this topic on Tuesday 25 September. The European Commission has proposed to set at 0% the obligatory set-aside rate for autumn 2007 and spring 2008 sowings, in response to the increasingly tight situation on the cereals market.
Neil PARISH (EPP-ED, UK, South West Conservative) and Chair of the EP Agriculture Committee spoke in favour of the report. He said: "I think there is a moral argument here as well. When the world has plenty of food, then perhaps Europe does not need altogether to do its share of production, but when the world is short of food and the prices go up, then Europe is morally obliged to produce food. Europe is never going to starve, whatever the price of food is, because we basically have money to pay for it, but many parts of the world will. All of a sudden we are in a different world and one that we must face up to. The Commission is proposing a set-aside of zero for 2008 and at the beginning of the marketing year 2008, like I said the market is characteristically high in price."
In the EU-27, a lower than expected harvest in 2006 (265.5 million tonnes) led to tightening supplies at the end of marketing year 2006/2007 and to historically high prices. Intervention stocks have shrunk from 14 million tonnes at the beginning of 2006/2007 to around 1 million tonnes now in September, mainly composed of maize held in Hungary. Reducing the set-aside rate from 10% to 0% is expected to increase output by at least 10 million tonnes.
Set-aside was introduced to limit production of cereals in the EU and applied on a voluntary basis from 1988/89. After the 1992 reform, it became obligatory i.e. producers under the general scheme were required to set-aside a defined percentage of their declared areas in order to be eligible to direct payments. With the 2003 reform, they received set-aside entitlements, which give the right to a payment if they are accompanied by eligible land put into set-aside.
