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Debates
Wednesday, 9 July 2008 - Strasbourg OJ edition

17. Question Time (Commission)
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  President. − The next item is Question Time (B6-0168/2008).

The following questions have been submitted to the Commission.

 
  
  

Question No 43 by Georgios Papastamkos (H-0455/08)

Subject: Performance of the automobile industry as regards CO2 emissions

Is the Commission satisfied with the performance to date of the European automobile industry in reducing carbon dioxide emissions and fuel consumption? Does it consider that its initiative to revise the Directive on the availability of consumer information on fuel economy and CO2 emissions in respect of cars (1999/94/EC(1)) amounts to an acknowledgement of the ineffectiveness of the existing Community regulatory framework for the car industry?

 
  
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  Stavros Dimas, Member of the Commission. − (EL) Mr President, the question is whether the Commission believes that the reduction in carbon dioxide emissions by the European automobile industry has been satisfactory.

The answer is ‘no’, and this is why we have proposed the mandatory reduction by 2012.

The second part of the question is whether the initiative for the revision of the directive on the labelling of cars amounts to an acknowledgement of the ineffectiveness of the existing Community regulatory framework for the car industry. The answer is ‘yes’, and this is why are proposing the revision.

I could limit myself to these two simple answers, but I wish to explain a little further.

We have proposed the mandatory limit on carbon dioxide emissions of 120 g by 2012, as provided in the strategy for carbon dioxide and cars. This will be realised through improvements in car engine technology, bringing the figure down to 130 g/km and, additionally, through other technologies, to 120 g/km.

I should mention that there was a voluntary agreement between car manufacturers and the European automobile industry, as well as the Japanese and Korean ones, for cars not to emit more than 140 g of CO2/km by 2008. Unfortunately, this objective was not realised: in 2006 emissions were at 160 g, whereas in 2007 they were at 159 g, according to the latest figures. The improvement by one gram is, of course, far from satisfactory.

We hope that in the codecision procedure Parliament and the Council will approve the Commission’s proposal, so that we will have cars consuming less energy, less fuel and emitting less carbon dioxide. By consuming less energy and less fuel, consumers will enjoy huge savings, especially at the current fuel prices.

With regard to labelling and to the information provided to consumers, by the end of the year we will have a proposal on how the relevant consumer information is to be provided.

I must mention that the European Parliament has adopted a resolution on this issue. Some of its points are highly positive, but there are others that I cannot agree with: for instance, that we should follow the example of tobacco advertising in the case of cars. These are two different cases and therefore we will not follow the example of a mandatory section set aside for information in advertisements.

There are other ways of informing consumers, given that when they buy a car they go to the dealership and they are provided with information on carbon dioxide emissions and also on fuel consumption through the brochures and signs found there.

 
  
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  Georgios Papastamkos (PPE-DE).(EL) Mr President, Commissioner, the G8 members propose a 50% reduction in carbon dioxide emissions by 2050. However, the advanced, rapidly developing countries (namely China, India, Brazil, Mexico and South Africa) do not seem to be responding to this proposal.

Do you believe that this position will affect the negotiations on the post-Kyoto period? What are the prospects of the crucial negotiations on the post-Kyoto period following this G8 proposal?

 
  
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  Stavros Dimas, Member of the Commission. − (EL) The question posed by Mr Papastamkos is, of course, completely unconnected with the first question we discussed regarding cars, but it is still very important and timely, considering the debate held and the decision taken at the G8 meetings yesterday and today.

It is a positive step that the G8, comprising the eight largest economies in the world, has agreed to reduce carbon dioxide emissions by 50% by 2050. Of course, as I have said previously, this is only half a step, because there was no agreement on any mid-term objectives for 2020, which would have been necessary for an international agreement that would effectively fight climate change.

I think that the matter of the other large countries, the developing large economies such as China and India, has also been dealt with and debated; of course, an effective solution to climate change requires the participation of these countries, for instance through measures to reduce the rate of increase in carbon dioxide emissions, always in accordance with the United Nations principle of common but differentiated responsibilities.

I believe that agreements will be reached, both on the long-term objective, where there is general consensus, and on the mid-term objectives, given that these agreements are essential in order to achieve the desired outcome in 2009 in Copenhagen.

 
  
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  Reinhard Rack (PPE-DE).(DE) Commissioner, I want to come back to automobiles. At the time when this 120 g target was fixed, there were a number of questions about the extent to which these 120 g should be regarded as an average, in terms of the entire industry and in terms of similar measurements.

Have these questions all been resolved or can we expect them to be resolved in time for the industry really to be able to react if it needs to do so in the short spaces of time provided?

 
  
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  Paul Rübig (PPE-DE).(DE) I would be interested to know whether it would not be worth offering incentives for taking old cars off the market, since they have the highest consumption and highest level of CO2 emissions. Could you consider a system of incentives here?

 
  
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  Stavros Dimas, Member of the Commission. − It is very interesting that fiscal incentives were emphasised in the G8 conclusions. In the European Union, fiscal incentives could be of great importance in order to promote the purchase of cars which are cleaner. Some countries are introducing such measures – France is a recent example, and it appears to have been more successful than expected.

We are positive regarding whether industry will be able to achieve the target of 120 g by 2012. It should be underlined that they have known about this target since 1995, and they had a voluntary agreement for achieving 140 g per kilometre in 2008. In any case, according to our impact assessment and to the cost estimates that the industry provided to us, they will be able to achieve this in time.

The King report, a very important and interesting study carried out for the Ministry of Transport of the United Kingdom, makes it quite clear that it is technologically and economically feasible to achieve this target in 2012. Of course, the concerns of the industry and the specific problems of each particular automobile industry should be taken into account. In any case, it is up to you, the European Parliament, and the Council to reach solutions that will both achieve our environmental objective and also provide for the competitiveness of the European automobile industry. We think this proposal will give incentives to the automobile industry and it will get the first-mover advantage, and also that European consumers will save by spending less on energy, especially with today’s very high oil prices.

 
  
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  President. − Question No 44 by Johan Van Hecke (H-0470/08)

Subject: Policy on biofuels

The Commissioner has previously stated that the European Union must review its priorities regarding biofuels if they proved to be having an adverse impact on the food supply in poor countries. But according to his colleague Mariann Fischer Boel, the impact of biofuel policy on food prices is not so serious.

According to the UN's Special Rapporteur Jean Ziegler, however, the massive production of biofuels is a crime against humanity, in view of its impact on world food prices. The FAO likewise states that the rapid rise of biofuels has substantially increased the prices of a number of crops, thus contributing to the current food crisis.

According to the OECD, farm prices will rise yet further in the next few years. When will it be clear to the Commissioner whether damaging effects are occurring or not? Does the Commission

intend to conduct research into this and if so, when will the Commissioner be able to present an evaluation?

 
  
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  Mariann Fischer Boel, Member of the Commission. − The European Union has agreed on a 10% target for renewable fuels within the transport sector, and this 10% is by 2020. I think it is important that we say ‘renewables’ because it is not only biofuels – it is not only ethanol or biodiesel. It could be electric cars as well, so we have to make this distinction.

I think we have to say that such a long lead time makes it unlikely that this can have had an impact on the price level that we see today. According to our calculations, by 2020 this could mean an increase in cereal prices of between 3 and 6%, rapeseed by about 8-10% and sunseed 15% as compared to the 2006 prices, assuming a share of 30% coming from the second generation of biofuels.

I think I can see that there is some hesitation among some Members of Parliament. One of the honourable Members does not seem to agree, but I think you have to take into account that quite a lot of the present increases in food prices stem from the high oil prices. We have seen lots of calculations and impact assessments from the OECD, and the latest one clearly says that estimating an oil price of EUR 130 per barrel means an increase in crop prices of between 9 and 13%. So this is related to the oil price increase and not to the discussion on renewable energies.

I think it is also clear that the impact will be limited through the growing use we are hopefully going to see of the second generation of biofuels, which is encouraged by our policies.

Second-generation biofuels are produced from feedstock other than food crops and can come not only from dedicated energy crops but also from sources such as recycled vegetable oil, animal fat, by-products from the forestry industry, forestry residues and solid waste such as grasses.

In the Commission proposal put on the table on 23 January this year for a directive on the promotion of the use of energy from renewable sources, the Commission proposed that it will monitor, amongst other things, the commodity price changes associated with the use of biomass for energy and any associated positive and negative impacts on food security.

In addition, the Commission proposes to report every two years on, among other things, the impact of our European biofuel policy on availability of foodstuffs in exporting countries, the ability of people in developing countries to afford these foodstuffs, and wider development issues.

The Commission has presented its view on the cause of the recent rise in food prices in the recent communication ‘Tackling the challenge of rising food prices: directions for EU action’.

So, given the volatility and the complexity of the current price trends, the Commission will closely monitor price developments within the European Union and internationally and will report by the end of the year on the evolution of the situation.

As stated in the communication, although demand for agricultural commodities is also influenced by the biofuel market, Commission analyses indicate that current European biofuel production has little impact on current global food prices.

 
  
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  Johan Van Hecke (ALDE). – (NL) Thank you to the Commissioner for her answer. A year and a half ago biofuels were still a miracle aid in the fight against global warming. Now, they are starting to be vilified and I note that the Commission endorses last weekend's U-turn by the energy ministers – though it will doubtless deny the fact.

My question – the Commissioner has bombarded us with figures here – is whether the Commission agrees with the World Bank study which claims that 75% of biofuels are responsible for 75% of the rises in food prices worldwide. The FAO reaches similar conclusions and the UN's special rapporteur, Mr Ziegler, describes the massive production of biofuels as a crime against humanity.

Does Mrs Fischer share the view of the World Bank, FAO and UN?

 
  
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  Mariann Fischer Boel, Member of the Commission. − First of all, I think we can see that renewable energies and biofuels have recently been the scapegoat for increased prices within the agricultural commodities sector. Clearly there are different reasons for these increases. The adverse weather conditions that we have seen in parts of the world have had a high influence – almost four times as high as the influence of biofuels.

Secondly, we have seen a huge demand from Asia. In China and India they are now starting to eat meat, which means that they need to import much more cereal than they used to do.

Thirdly, speculation: investors are moving their money out of stocks and shares and bricks into agricultural commodities, into gold and silver. This is obvious.

Some countries have closed their borders for exports of agricultural commodities and this has also contributed. Looking at the United States, the fact that the Americans have now introduced a very comprehensive use of corn for bioethanol has had an effect on the corn sector. Of course this has an influence on the world market price for corn. But in Europe we use less than 1% of our production area for renewable energies and that cannot have an influence on the price level that we see.

What is important is that we produce these renewable energies in a sustainable way and that we apply certain criteria to the different types of renewable energies. We have said clearly that a 35% reduction of CO2 emission is the minimum and we would be prepared to go further. For example, 50% has been mentioned as a figure to be introduced by 2015.

Regarding the honourable Member’s question on the World Bank study, I must say first of all that it has not yet been published. A pirate copy has been leaked. It is therefore difficult for the World Bank to comment on something that has not yet been published. But I have to say that personally I would like to see a commitment and a confirmation from the World Bank that they are going to sign up to the 75%. I do not believe that 75% is a figure that can be defended. It is not even on cereal prices but on food prices. When you know that sometimes on food – bread, for example – only up to a maximum 10% of the value of the bread can be related to the wheat, I simply cannot imagine how this figure of 75% can be right.

I would be very happy to come back to the European Parliament to discuss it when this report has been made public and we have a solid basis for discussion and not just rumours that appeared in one single newspaper when it was leaked.

 
  
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  Jim Allister (NI). – Commissioner, I admire your tenacity in sticking to the line about the low impact of biofuels on food prices, but I do wonder how long you can sustain that. As has been pointed out to you, you are very much out of line with other experts across the world. You have heard about the FAO and, it seems, the World Bank.

You make the point repeatedly that we only put 1% of our production into biofuels. That may be, but we in Europe depend so much on imports for our feedstuffs from the Americas – and that is where the impact on food prices is coming from. It is the requirement to face up to that and to move as speedily as we can to second-generation and even third-generation which the Commission should be focusing upon.

 
  
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  Glyn Ford (PSE). – It seems to me that if the argument is regarding lead times, then oil prices are exempt from being a cause of rising commodity prices rather than biofuels; but will the Commissioner urge the World Bank to publish the result? Will she write to them and indicate that we would like to see this report published, so that we can all debate its argumentation? On that basis, does the Commission not feel we should urge, in the interim, a moratorium on all new biofuel products that are not based entirely on non-edible by-products of food and food processing?

 
  
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  Mariann Fischer Boel, Member of the Commission. − First of all, in answer to Mr Allister, when we talk about the dependency within the European Union on feedstuffs you are quite right, we are dependent, especially on soya bean imports. That is why we have ongoing discussions as to whether it is possible to find a solution on the GMO issue in order to lower the price on imported soya beans. This is by far the biggest and most important crop for our pork industry.

I had hoped to be able to convince the honourable Members that we are actually doing quite a lot to push, and to invest in, the second generation of biofuels; because I agree with all of you that the first generation is not a long-term solution. But we need the first generation as a stepping stone for the second generation. If we now send a clear message that we will no longer stick to our target of 10%, I can guarantee that all investments within the European Union are going to disappear and the investments will move to South America and we will be depending on importing all our biofuel from Brazil produced from sugar cane. Then our independence – as we would like to see it – would be much more difficult to fulfil.

In relation to the not yet published World Bank report – I presume we are in agreement that it is not published, it is leaked – by coincidence, the morning we got the press release on the 75%, the chief economist from the World Bank was sitting in my office and he could not confirm the 75%.

Therefore, I am sure we will return to this issue and I would be very happy, as I said earlier, to discuss this on the solid basis of a published report.

 
  
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  President. − Question No 45 by Paulo Casaca (H-0479/08)

Subject: Execution of the perpetrator of an attack on the United Nations

According to the eNewsletter Hands off Cain, No 107 of 6 June, Leandro Despouy, the United Nations Special Rapporteur on the independence of judges and lawyers, has reaffirmed the UN’s belief that the Iraqi authorities' execution of Awraz Abdel Aziz Mahmoud Sa’eed for carrying out the attack on the UN headquarters in Baghdad in August 2003 – which killed, amongst others, Sérgio Vieira de Mello, UN Special Representative for Iraq – prevented the international community from learning who the real perpetrators of the crime had been.

What steps did the Commission take to voice the EU’s blanket opposition to the death penalty?

What measures is the Commission intending to take to clarify the reasons underlying the speed with which Awraz Abdel Aziz Mahmoud Sa’eed was executed, despite the express requests made by the United Nations, which legitimately wanted to discover the underlying reason for the attack on the UN and identify the organisers thereof?

 
  
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  Vladimír Špidla, Member of the Commission. (CS) Mr President, ladies and gentlemen, together with the Member States the European Commission is the world’s foremost institutional player and donor in the fight against the death penalty. Its activities in this regard are at the forefront of its external policies on human rights. The general principles of the European Union’s policy towards third countries concerning the death penalty, adopted in 1998 and reviewed in 2008, set out the criteria for issuing demarches and define the standards that should be used. Abolition of the death penalty is one of the main thematic priorities when providing help within the framework of the European Instrument for Democracy and Human Rights. Since 1994 the Commission has financed worldwide approximately 30 projects, the total monetary value of which is roughly EUR 15 million. Commissioner Ferrero-Waldner categorically expressed her opposition to the death penalty, whether actually used in practice or set out in legislation, in a public declaration on 10 October 2007, on the occasion of the World Day Against The Death Penalty, and on other subsequent occasions.

The incident, which is the subject of the letter written by the Member of this House, is known to the Commission. Iraq is one of the countries to which the European Commission often sends demarches on the use of the death penalty. In this particular case, the demarche was sent in June 2007. Both the European Union and the Commission have repeatedly called on the Iraqi Government and the Supreme Court of Iraq to abolish the use of the death penalty and to mitigate all death sentences that have been passed but not yet carried out. Furthermore, they have called on the Iraqi Government to introduce, without delay, a moratorium on all executions. Needless to say, in the case of the bomb attack on the UN headquarters on 19 August 2003, such a moratorium would have made it possible to carry out a detailed cross-examination of all persons who could have provided potential evidence needed to ensure that no perpetrator of this attack goes unpunished. Indeed, the Commission is alarmed by the speed with which this case was dealt with. Our main goal, however, is to advocate the abolition of the death penalty in general. The Commission continues to cooperate closely with the Member States of the European Union in an effort to express our position and dissatisfaction with the Iraqi side.

 
  
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  Paulo Casaca (PSE). (PT) The issue raised here, however, is that the Iraqi government prevented an investigation of the assassination of Sérgio Vieira de Melo in the same way it did in other cases. I have here in my hands a copy of a magazine recently published, in which Zenaib Ahmed appears. I have invited this person to come to the European Parliament to speak about the mass executions in Iraqi hospitals carried out on purely ethnic grounds.

In the light of this situation, which is much worse than the situation in the Western Balkans, I want to know when the international community and the European Commission is going to demand an international tribunal to investigate and judge the killing of tens or hundreds of thousands of people in Iraq.

 
  
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  Vladimír Špidla . − (CS) Mr Casaca, of course the European Commission and the European Union explore, in general, all options available to us, so that we can strengthen our ability to gradually limit and eliminate the use of the death penalty, in particular in those areas where it is used most frequently, and that, of course, includes Iraq as well.

 
  
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  President. − Question No 46 by Claude Moraes (H-0427/08)

Subject: Anti-discrimination horizontal directive

The European Commission announced that this spring would see the launch of the new horizontal directive prohibiting discrimination.

What is the latest development regarding the scope of the directive? Will there be a far-reaching anti-discrimination directive including ALL of the remaining grounds of Article 13 of the Amsterdam Treaty – namely age, disability, religion or belief, and sexual orientation, as supported by a majority in the European Parliament?

If not, could the European Commission give its reasons, and outline its detailed plan of action for the coming months?

 
  
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  Vladimír Špidla, Member of the Commission. (CS) Mr President, ladies and gentlemen, last week the Commission adopted a proposal for a directive which provides for protection from discrimination on grounds of age, disability, sexual orientation and religion or belief beyond the workplace. Discrimination on these grounds in employment and occupation is already covered by Directive 2000/78/EC. In this way we have fulfilled the commitment that we made, in front of you, at the beginning of our term of office. We have answered your repeated calls for such a proposal, last expressed during the part-session in May. This proposal for a directive is based on principles that Member States have already adopted in existing directives. For example, it contains provisions ensuring protection for victims of discrimination and dealing with harassment and victimisation, as well as provisions concerning the establishment of equality authorities. As I said earlier, the proposal for a directive provides for protection from discrimination on four basic discrimination grounds, but giving equal importance to all four of them does not mean that provisions concerning all these types of discrimination are equal.

The proposal for a directive therefore takes into account the specifics of each ground of discrimination so that the directive is as effective as possible. Specifically, it makes it possible, depending on the context, to take into account the age, and to consider the issue of age and disability in the insurance and banking sector, if this is adequate and reasonable, and I stress the words adequate and reasonable. This may never mean wilful exclusion of older or disabled persons from these sectors. In cases of disability, the principle of equal treatment is a positive commitment providing for general accessibility for disabled persons and carrying out appropriate adjustments in individual cases. Such measures do not represent a disproportionate burden. The proposal for a directive clearly states that account shall be taken of the size, nature and resources of the organisation, the estimated cost, the life cycle of goods and services, and the possible benefits of access for persons with disabilities. The proposal is an important step towards closing a huge loophole in non-discriminatory legislation.

Of course we realise that protection from discrimination on grounds of gender outside the workplace is not yet as strong as protection from discrimination on grounds of race. This is because Directive 2004/113/EC does not cover the area of education, as can be seen from the explanatory statement of this proposal. We think that it would be too premature to propose changes to said Directive, since the period for its implementation ended only recently. However, when we are preparing the implementation report in 2010, we can propose changes to the Directive if necessary.

 
  
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  Claude Moraes (PSE). – Commissioner, this is an example of a question tabled some weeks ago which, very happily, received its positive answer on 1 July with your announcement. I think you should take personal credit for championing this within the Commission and for listening to the vote of the European Parliament.

Let me just ask you and the Commission to maintain your vigilance so that derogations and exemptions to the principle of equal treatment are not sought on just any grounds: they must be sought on necessary grounds and on genuine principles of subsidiarity, because we have seen transpositions of the Employment Directive and Race Equality Directive which were not complete and we must ensure that this good package becomes law in the Member States.

 
  
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  Vladimír Špidla. (CS) It is obvious that such a directive which is far-reaching and which protects the fundamental values of the European Union is often viewed differently and is often exposed, for various reasons, to pressure for its effectiveness to be limited. Being fully aware of this, the Commission prepared this complex proposal which we are of course ready to defend in further stages against any unjustified challenges.

 
  
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  Syed Kamall (PPE-DE). – Could I ask the Commissioner to comment on British newspaper reports? Apparently, as reported in the press, anti-discrimination legislation does not currently apply to workers over the age of retirement, and people of retirement age or older are being legally sacked. Does the Commissioner have plans to tackle the British Government’s discrimination against older workers?

 
  
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  Vladimír Špidla. (CS) In general, the Directive protecting people who belong to the labour force also protects them from discrimination on grounds of age. I cannot make specific comments on the British newspaper report since it is, as always, qualified by the specific circumstances of the particular case. I can only say, with confidence, that in this regard there are no exceptions in this Directive, according to which protection no longer applies above a certain age.

 
  
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  President. − Question No 47 by Brian Crowley (H-0433/08)

Subject: Supplementary pensions and mobility across the EU

Today, changing job or country often means losing occupational pension benefits in some Member States. The ‘portability of pensions’ Directive (2005/0214(COD)), proposed in October 2005 and now amended, will bring more flexibility into the conditions regarding acquisition of pension rights and vesting (such as different qualifying periods before which workers acquire rights) and preservation of dormant pension rights (such as pension rights losing value over time), as well as improving information for workers on how mobility may affect supplementary pension rights.

Can the Commission inform us when it envisages agreement on this directive and provide a timeline for its implementation, in the interests of EU citizens’ being able to move freely within the EU without having an additional worry regarding pensions?

 
  
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  Vladimír Špidla, Member of the Commission. (CS) To start with, I am glad this important question has been asked and I am thankful for the European Parliament’s efforts to achieve progress. Of course I am also thankful for the efforts of the Slovenian Presidency and other presidencies to reach an agreement. In spite of this, the disappointing fact remains that agreement has not yet been reached. This is because the question of removing the obstacles to the free movement of workers caused by supplementary pension schemes, which is at the heart of this problem, has not yet been answered. In today’s constantly changing world, the possibility of changing jobs easily or employing the right person with the necessary qualifications is more important than ever. Moreover, supporting the adaptability of the workforce, labour market flexibility and modernisation of social security systems are the basic elements of the Lisbon Strategy. It is quite obvious that, if we expect people to be more flexible, we have to make sure that they are not punished for this by the loss of the social safety net.

The case of supplementary pension schemes is a typical example of the strategy of flexicurity advocated by the European Commission. The Commission has tried especially hard to solve the issue of supplementary pensions but, try as it might, unfortunately a compromise has not yet been found. That said, considering how important this issue is in regard to the social rights of workers in general, to the development of pension schemes and to giving the right response to the matter of demographic ageing, the Commission is ready to continue and will not relax until a compromise that can become the basis for the overall solution is found. Although we are not there yet (since this decision must be unanimous and the Council has not yet adopted a unanimous position), the Commission continues working towards the goal of improving the situation regarding supplementary pensions.

 
  
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  Brian Crowley (UEN). – I would like to thank the Commissioner for his response. Commissioner, you raised two points that I think are essential within this whole complex issue: first of all the flexicurity idea, and secondly the Lisbon Agenda about creating another freedom within the European Union single market – free movement of workers.

In many ways the lack of availability of mobility of pensions is denying many people the opportunity to take up what could be better paid jobs in other areas because they cannot carry over pension entitlements or even freeze pension entitlements in their home Member State.

So maybe you could suggest to us as part of the social package which you are now bringing forward – rightly welcomed by so many – where we can push the buttons to ensure we can get Member States – those that are blocking this – to come on board for the ideal.

 
  
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  Vladimír Špidla. (CS) All I can do is to say that, in just a few words, Mr Crowley gave us an almost perfect analysis of the problem. Yes, this is how it really is. This is also the reason why we will remain active. This is not an issue that the Commission would regard as closed.

 
  
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  Reinhard Rack (PPE-DE).(DE) Commissioner, you were right to draw attention to the problem and to the fact that the main reason it cannot be resolved is that because of the unanimity principle Member States are not budging. Sometimes rough customers need rough handling. Is it not high time, with the debate on the internal markets as it stands now, to actually name and shame the Member States in question so as to ensure that at least some Member States reconsider the disastrous way they have sometimes behaved in the past and change their approach?

 
  
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  Vladimír Špidla. (CS) You are quite right: all fundamental political ideas are debated in the Council and these debates are not carried out behind closed doors. All Member States have gradually managed to express their opinion, and only the Federal Republic of Germany did not express its consent. This is the situation but, as I have already said, this does not mean that we have reached the end of the road. We will be looking at other ways and options in order to achieve unanimity. I want to stress that of course the systems are different in individual Member States, and of course the decisions concerning these systems are not just minor technical matters. Therefore I fully understand that countries take this question seriously but, as I have already said, this is how the situation is at the moment.

 
  
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  President. − Question No 48 by Robert Evans (H-0443/08)

Subject: Medical support across the EU

Can the Commission clarify exactly what entitlements to medical support EU citizens have when travelling to another Member State? Does the support provided by the European Health Insurance Card apply to all age-related illnesses?

As the methods of financing health services vary from Member State to Member State, what procedures are in place to enable a fair and equitable system that provides proper support for all those in need?

What arrangements are in place for those travelling to tax havens such as Andorra, the Channel Islands, Lichtenstein, etc., which are surrounded by the EU but are not themselves deemed EU territory?

 
  
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  Vladimír Špidla, Member of the Commission. (CS) Mr President, ladies and gentlemen, the holder of the European Health Insurance Card is regarded as insured under the legislation of the Member State in which he has arrived. In accordance with Article 22 of Regulation (EEC) No 1408/71 this card is valid for a temporary stay, whatever its purpose: tourism, employment or study.

If the holder of this card is in need of health care during his stay, the card entitles him to receive this health care from medical staff. The European Health Insurance Card covers its holders for ‘essential health care’.

This term, which depends on the patient’s state of health and on the anticipated length of stay, was defined by the Administrative Commission on Social Security for Migrant Workers in 2004. The health care in question is a treatment that must be given to a person who resides temporarily in another country’s territory, so that this person is not in danger of death and forced to return prematurely to his country of origin in order to receive the necessary health care.

Medical staff must apply these criteria on a case-by-case basis, taking into account the patient’s state of health and the length of his stay. The Administrative Commission on Social Security for Migrant Workers also adopted instructions aimed at ensuring that all stakeholders (health care providers, insured persons and health insurance companies) interpret this term the same way. These instructions are available from the Gateway to the European Union.

Both a pensioner spending three months with his children and a student making use of the Erasmus programme will therefore have access not just to the necessary health care but also to the care that would be offered, in the same situation, to persons residing in the given Member State.

The system of health care provision, as stipulated in Article 22 of Regulation (EEC) No 1408/71, lays down the provision of health care and the payments for this in accordance with the legislation of the country in which the patient is temporarily residing. This means that persons temporarily residing in the country enjoy access to health care under the same conditions as persons participating in the health insurance system of that country.

Article 22 of Regulation (EEC) No 1408/71 also applies to the countries of the European Economic Area, including Liechtenstein and Switzerland. Negotiations concerning Andorra have not yet been successfully concluded.

 
  
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  Glyn Ford, deputising for the author. − Mr President, unfortunately, Mr Evans has had to return to the United Kingdom. On his behalf, I thank the Commissioner for his answer to the question.

With the sharply rising number of cross-border marriages – almost one in five couples now come from two Member States – and with the rising percentage of couples and individuals over retirement age travelling around the European Union, does the Commission not feel that, unless it takes urgent action on these matters, unequal treatment will lead to health refugees rather than the more widely speculated health tourists in the EU?

 
  
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  Vladimír Špidla. (CS) You asked several questions, each of which needs a complex answer. Let me give a simplified answer to the first question: this morning we were debating Regulation (EC) No 883/2004 which will significantly amend Regulation (EEC) No 1408/71 and which will definitely improve the situation of many people precisely in the area of cross-border contact. Regarding your question about health tourism, I think that this is a very vague concept; so vague that it is dangerous. Since it may become a very significant phenomenon, we have to define, very carefully, what health tourism means. However, I think that real health tourism is not particularly widespread because in most cases people suffering from really serious health problems try to stay in their own environment, and also because individual Member States’ systems do not substantially differ from each other at a basic level. Clearly, Regulation (EEC) No 1408/71 and the future Regulation (EC) No 883/2004 cover the vast majority of cases linked to tourism, but not health tourism. Primarily, they concern people who have set out on a journey and then something has happened to them while away from home. There are hundreds of thousands, perhaps up to one million cases each year. The solutions are adequate and do not adversely affect the stability of the health systems. Regarding the Commission’s intention to bring about improvements in this area, this intention is tangible, as shown for example by the amendments tabled by my colleague, Mrs Androulla Vassiliou. I think that there will be an opportunity for a detailed debate on cross-border care and related issues but at this stage I want to distance myself once more from the concept of so-called health tourism. I think that this is a rather vague concept, one that can provoke reactions not appropriate to the situation.

 
  
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  President. − The time allocated for questions to Commissioner Špidla is over. Answers to Questions 49 to 54 will be given in writing.

 
  
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  President. − Question No 55 by Eoin Ryan (H-0439/08)

Subject: Reporting burden of small and medium enterprises

I welcome the recent initiative taken by the Commission to reduce the statistical reporting burden on businesses, especially small and medium enterprises. However SMEs still face large reporting burdens, such as VAT reporting, that cost many man-hours and that put small businesses at a competitive disadvantage. Does the Commission have any proposals in the pipeline that will reduce red tape and the reporting burden for SMEs?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) Mr President, Mr Ryan, I am very grateful to you for this question because it addresses a problem with which the Commission has been deeply concerned for years: how to reduce unnecessary red tape for small and medium enterprises in Europe. I am glad to be able to tell you that we have indeed made huge progress in this area and I am firmly convinced that we are about to see a real breakthrough.

Basically we have identified the costs of red tape for European enterprises as costs arising from reporting, documentation and information obligations. We are currently engaged in actually measuring those costs, in the largest project of its kind in the whole of history. That means we really are establishing what costs these rules actually create for enterprises so that we can then see where the costs come from and whether they can be reduced.

You can expect a large number of Commission proposals from about September this year, based on the results of the measurements and the screening of all the existing rules. We expect that will enable us to put forward so many proposals by the end of 2009 that the cost of red tape for European enterprises will fall by 25% in the year 2012. We are assuming that will trigger a 1.4% to 1.5% growth in the entire European GNP. So you can see we really are talking significant orders of magnitude.

You then addressed a particular problem that is, however, quite distinct from the matter of normal bureaucratic costs. It is the burden placed on small enterprises in particular to comply with the tax requirements – and you know that the European Union’s powers in this regard are extremely limited. We know from all our inquiries that the enterprises themselves feel that the requirements of the financial authorities represent by far the most serious and heaviest burden, so this is an area where it really is up to the Member States to simplify matters.

After all, we only have competences in the area of turnover taxes and even there they are very limited. The Commission has, however, made one very important proposal that would be a great help to small and medium enterprises: it is substantially to raise the threshold above which they need to declare turnover tax in advance, i.e. register for VAT. The current threshold is EUR 20 000, we want to raise it to EUR 100 000, which would free nearly all very small enterprises and in particular newly established enterprises from this heavy burden.

Sadly I must tell you that so far the Member States have not been prepared to accept that proposal. I hope that the Small Business Act that the Commission presented a few days ago and in which we addressed the question once again will put more pressure on those Member States that are creating difficulties here and I am extremely grateful to the European Parliament for its numerous signs of support in this regard.

 
  
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  Eoin Ryan (UEN). – I would like to thank the Commissioner and I look forward to the announcements in September. I think that some of the administrative burdens, especially on small and medium enterprises, are absolutely huge, and they very often do not have the manpower or womanpower to deal with them. But could you elaborate more on the EUR 100 000 threshold? Are you announcing that, or are you going to name and shame the countries that are resisting it? Could you give us some more details about that threshold?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) Mr Ryan, as I said it is an official proposal, which the Commission agreed as early as 2004. Since then, the Council has still not adopted the proposal. I pointed out that we have now put the proposal forward again, in the context of the Small Business Act; basically that means we are presenting it again. It is not an announcement; it is something the Commission has already proposed. It regards it as necessary. A short time ago Mr Špidla referred, in the context of another answer, to the need for unanimity on certain issues. Here too we need unanimity and unfortunately it was not achieved. I am sure I need not tell you, who represents Ireland, that a whole number of Member States regard questions of tax in the European Union as a taboo subject.

 
  
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  Wiesław Stefan Kuc (UEN). – (PL) Commissioner, I have the following request. If you are going to be doing all this research, can you look into the indirect costs of running a small or medium-sized enterprise? Could you please have a look at the World Bank report from around two years ago, which analysed these costs. The report states that Poland, for example, has very low legal costs, but in practice this is not true. I also have a related request, which is not really a question. Instead of looking at what officials say, could you look properly at what the real costs are? All the stamps that need to be paid for, all the documents that have to be submitted. There are so many of these sorts of additional costs.

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) The measurements we are conducting now and that are nearly concluded will give us exact information about which European rules give rise to which costs. We will then be in a position to say which specific European rule gives rise to precisely which costs for enterprises.

Of course we already know quite a lot. For instance, we already know that most of the costs go back to a very small number of rules. The vast majority of rules come from no more than some 42 directives. We also know which area gives rise to the highest costs, namely European company law, which is why we have now put forward the first proposals relating to that area.

We also know that the distribution of costs varies widely, depending on the size of the enterprise. As a rule of thumb we can assume that the smaller the enterprise, the heavier the relative burden of administrative costs. Those costs may easily be far higher than 5% in the case of very small enterprises, while being considerably lower for very large ones. We know all that anyway and it will be taken into account in the proposals.

Let me take this opportunity to make a request to Parliament. Whether this whole project succeeds will, of course, depend very much on whether Parliament deals with the Commission’s proposals rapidly. We do, after all, have a general political agreement on them. I just wanted to point out that it certainly involves amending existing legislation, which requires the assent of both co-legislators.

 
  
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  President. − Question No 56 by Colm Burke (H-0448/08)

Subject: Price of fertiliser

The price of fertiliser has gone up dramatically over the last 12 months. Ammonia phosphate, for instance, has increased from EUR 181 per tonne to EUR 800 per tonne in wholesale markets.

Does the Commission plan to take any action to counteract this price hike?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) Mr Burke, I share your concern about rising fertiliser prices. They have indeed risen disproportionately. Understandably, that creates major problems and great concern in European farming.

Fertiliser prices have risen because of the sharp rise in demand, which comes on top of higher transport and energy costs. There are, therefore, three factors: higher demand because of the rapid growth in other parts of the world, higher energy prices and higher transport prices. Demand has risen across the world, as you know, and this affects not just fertiliser but a whole range of other goods too, including cash crops and food.

It is important to remember that, for the fact is that although European farmers have to spend more money on fertiliser, as they are indeed doing, at the same time they are getting better prices for their harvests. FAO statistics over a comparable period show that food prices have risen by 37% over a 12-month period. We saw the sharpest rise with milk products, at 80-200%, and cereals, at 50-80%.

The Commission believes it is vital to observe the rules of competition. As long as that is the case, the Commission does not consider it appropriate to intervene in a market where the latest developments can be traced largely to factors over which the Commission has no influence whatsoever. Let me repeat: we have no influence over the three deciding factors that led to the price rises.

As regards longer-term developments, the Commission would also draw your attention to the importance of promoting competition on the natural gas market. I think there is a real chance here of easing the situation somewhat. If the measures the Commission proposed under the third energy package are accepted, we should see an improvement in gas market prices. That could also lead to lower prices for nitrogen fertiliser produced in the European Union. As you know, however, it all depends on whether the energy package proposed by the Commission is accepted.

 
  
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  Colm Burke (PPE-DE). – Thank you for your response on this matter. It is of concern. I know you referred to the price of milk products and other items going up, but unfortunately farmers are not getting the benefit of those rises: it is the parties in between who are getting the benefits.

My question really is about our reliance on supply from outside the EU. It appears that we are relying on Russia and Ukraine for the raw materials for our fertilisers. I am just wondering what action we are taking in order to make sure that we have adequate supply and are not over-reliant on one or two sources. Can we not identify other sources and put mechanisms in place to encourage importation from those other sources?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) As regards Russia and Ukraine as major supply countries, I must point out that we are applying trade protection instruments to fertiliser exports from both countries.

To put it quite simply: both countries can of course offer fertiliser at low prices because they know that the energy required to produce fertiliser is particularly high and they apply different prices for exported energy and for energy used in their own country. That price difference leads to dumping, which is why we have applied the appropriate measures in relation to Russia and the Ukraine.

On diversifying supplies, the Commission has little margin for influence here. I can tell you, however, that as far as I know the large European producers and distributors are naturally seeking to diversify their raw materials basis. I am quite prepared to look into this question again in more detail.

 
  
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  Mairead McGuinness (PPE-DE). – I would like to thank the Commissioner. This probably flows over into other questions for Commissioner Fischer Boel. You made a point about higher prices in the harvest, but it seems that the costs of producing food are now increasing faster than prices are rising and this is surely a problem that Europe needs to address. Perhaps you would respond to that?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) Mrs Fischer Boel is here, which is why I will answer very carefully, because she is the one who really knows about the prices that European farmers can achieve. On the basis of what she has told the Commission to date, I assume that producer prices are indeed rising for all important EU products. I do not deny, however, that you may be right in saying that the higher harvest prices do not necessarily make up entirely for the rises in costs. That is a point the Commission will certainly address.

Regarding developments in the food sector in general – and here we are not talking just about producer prices but are also concerned with what the consumer eventually has to pay – a few weeks ago we launched an initiative and set up a high-level group to consider the future of the European food industry, which, and not everybody knows this, is the biggest European industry. Many people actually think the automobile sector is the biggest European industry, but that is not true. The food industry is the biggest one of all in Europe.

In this high-level group we are looking very specifically at price trends and we will conclude our work by the end of the year, when we will make the appropriate recommendations.

 
  
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  President. − Question No 57 by Marie Panayotopoulos-Cassiotou (H-0457/08)

Subject: Policy in favour of small enterprises

As part of an open single market which encourages small enterprises, will the Commission say Commission proposes to ensure that new technologies are used to benefit them and what practical benefit they derive from research programmes funded by the European Union in the 27 Member States?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) Mrs Panayotopoulos-Cassiotou, this is a very topical question and only a few days ago the Commission put forward a very broadly based initiative in this sector.

Let me start by saying that I am very pleased that the enormous importance of small and medium enterprises to our economy and to job creation has been widely recognised throughout the European Union in recent years. I was particularly concerned to ensure that all the European institutions and the Member States pay due attention to the role of small and medium enterprises. If we do not make full use of the SMEs’ growth potential, if we do not make full use of their workforce potential, we will not be able to master the consequences of globalisation in Europe. Let me make this point quite clear: we will successfully master the consequences of globalisation if we manage to strengthen the SME sector in Europe. To that end, the SMEs must be able to make even better use of the opportunities offered by the internal market and global competition.

A vital factor here – and I now come to your question – is access to knowledge, research and innovation. It is not just large European enterprises but also small and medium ones, if they are at all active on the international markets, that must make the transition to the knowledge-based economy. That is their only chance now. They cannot compete in terms of price; they can only compete by offering a better quality of product or service and that better quality comes from better technology and from innovation.

One of the main instruments available to them at Community level is, of course, the Seventh Framework Research Programme, which will provide funding of at least 15% for small and medium enterprises, and it appears from the early results that we will certainly achieve that target.

The Small Business Act to which I referred earlier brings with it a whole range of other proposals designed to give small and medium enterprises easier access to innovation, knowledge, research and technology. Let me give a few examples. Firstly, there is the proposal to simplify the rules on state aid to promote research, development and innovation, in particular through the block exemption regulation. The Commission decided that last week and it will free up great potential. The second is incentives for establishing enterprises with a high growth potential by promoting research and innovation capacity, in particular by the closer coordination of national programmes and initiatives. Then there are measures to promote greater participation by small and medium enterprises in the transfer of knowledge. Here we will be setting up a new pilot project aimed to help finance the industrial use of intellectual property. I could also mention that we are encouraging SMEs to play an active part in the activities of the European Institute of Innovation and Technology, to ensure that they can also benefit from the transfer of knowledge that Institute will promote.

As you can see, a lot is happening here. Let me make it quite clear, though, that in the end it is of course up to the entrepreneurs and enterprises themselves whether they make use of the opportunities they are offered. It is, therefore, very important to make market participants far more aware of the opportunities that already exist today. That is a question of information and communication, both of which need to be greatly improved. And that is why the Commission created the European e-Business Support Network early this year. It is the largest network of its kind in the world and its aim is to put every European enterprise within reach of a contact point that can answer all the questions about innovation, access to EU programmes and access to research resources.

 
  
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  Marie Panayotopoulos-Cassiotou (PPE-DE).(EL) Mr President, Commissioner, please accept my sincere thanks for your answer, because it has indeed been comprehensive and you have also covered the supplementary question regarding the issue of communication with and information for businesses.

Would you mind giving me some more information? I come from a region located on the eastern borders of the European Union as it currently stands. Information does not reach that region and small businesses are struggling, simply vegetating; they are relying solely on price differences, as you said, and not on quality, and are heading for closure.

What is your advice on this?

 
  
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  Günter Verheugen, Vice-President of the Commission. − (DE) Mrs Panayotopoulos-Cassiotou, I am very grateful for your support. Of course, I knew I would be able to rely on you entirely in this matter, just as you can rely on me entirely.

Regarding the density of the network, I must admit that we have not yet achieved the desired density throughout Europe. When we complete the project, as we will do over the next five months, every region in Europe will have one of those facilities. There will be contact points in every region, located near enough to the enterprises to ensure nobody will have any difficulty in accessing them.

 
  
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  President. − The answer to Question 58 by Mr Heaton-Harris will be given in writing.

 
  
  

Question No 59 by Liam Aylward (H-0435/08)

Subject: Proposed increase in modulation in the context of the CAP Health Check

In the context of the CAP Health Check, could the Commission envisage a situation in which the proposed increase in modulation would be on a voluntary basis?

Question No 60 by Sean Ó Neachtain (H-0437/08)

Subject: CAP payments

Farmers in receipt of less than EUR 5 000 in farm payments annually will not experience a reduction in their farm payment under the proposed Cap Health Check as outlined by Commissioner Fischer Boel. Would the Commission consider increasing this threshold?

Question No 62 by Ioannis Gklavakis (H-0444/08)

Subject: 'Health check' for the Common Agricultural Policy

Tobacco growing is the sole source of income for some 130 000 European farmers. Despite this, Regulation (EC) No 1782/2003(2) provides that from 2010 50% of Pillar I resources (direct aid) will be transferred to Pillar II (rural development), thereby significantly reducing the income of these producers. Furthermore, tobacco cultivation occurs in semi-arid regions where no alternative employment opportunities are available.

At the same time, the Common Agricultural Policy (CAP) is currently being given a 'health check', and many decisions taken during the CAP reform of 2003 are being reviewed.

In view of the above, will the Commission say whether it intends, as part of the CAP 'health check', to re-examine the tobacco aid regime and to preserve existing arrangements beyond 2009 until 2013? Has it drawn up a study to establish which crops could replace tobacco in these regions so that European tobacco farmers are not affected financially or socially?

Question No 65 by Stavros Arnaoutakis (H-0458/08)

Subject: Common Agricultural Policy: planning and application in favour of small producers

It should not be forgotten that agriculture is the basic form of employment for inhabitants in rural Greece, in particular in geographically disadvantaged regions, such as islands and mountainous regions. The cutting of compensation and direct aid with the transfer of resources from the First to the Second Pillar promoted by the Common Agricultural Policy has particularly alarmed Greek producers, since it will affect their already low income and lead to economic stagnation among small producers. How does the Commission intend to address, both in the short and long-term, the grave economic problems facing farmers (increase in fuel prices, high production costs, differences between producer and consumer prices) and to ensure the survival of small producers at European level?

 
  
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  Mariann Fischer Boel, Member of the Commission. − I am quite happy to have this opportunity to answer all four questions, since we seem to be fairly late, according to the initial schedule.

Regarding the first three questions, I would say that the European Union’s agriculture is both at the contributing and the receiving end of today’s global environmental challenges. We cannot stand by and fail to act. EU action is needed and, through rural development, we can provide the most targeted and effective measures. But, as you all know, our funds within the rural development policy are limited. The fairest and most straightforward way to raise money is through an additional shift of funds from the first pillar – from direct payment – into rural development policy in Pillar 2 through what we call increased modulation, of course on a compulsory basis.

I am not prepared to consider the increase in modulation on a voluntary basis. It is quite clear that the Commission took into account the fact that in February 2007 Parliament adopted a report rejecting the Commission’s proposal on voluntary modulation. I have to say that I am quite happy that we have always been in agreement on this issue.

Concerning the threshold, the Commission’s proposal is to transfer EUR 5 billion from the first to the second pillar in the period from 2009 to 2012. This calculation is made on the basis of the present threshold of EUR 5 000 or the franchise, as we normally call it. Raising this threshold would mean a substantial reduction in the funds. The Commission believes that, with less budget available, the effectiveness of dealing with the challenges within climate change and water scarcity will be significantly weakened.

Within the health check package, small producers who receive direct payments of a value less than EUR 5 000 will continue to be exempted from modulation. Therefore, small farms will not only continue to be protected from any possible negative effect of the shift from Pillar 1 to Pillar 2, but could also profit from the money that is generated through the modulation by engaging in the appropriate rural development programmes.

With regard to modulation, farmers sometimes say to me, ‘Well you take my money’ or ‘you reduce the payment to the agricultural sector, to the farmers’. This is not in fact true because of the fact that, when you modulate money, you generate more money to the sector in general, because the modulated money needs to be co-financed by Member States. It is clear that, with the new modulated money, we will be much more specific. We will simply make a menu of possibilities explicitly targeting the new challenges. This means that, to those who say that modulation or money in rural development policy can be used for whatever reason, I can promise you this is not going to happen with the money that we propose for modulation in the health check. So, instead of saying that we take money, we actually generate more money to be transferred back to the agricultural sector.

I am not sure if Mr Arnaoutakis is here tonight so therefore I am not going to answer that question.

To Mr Gklavakis, asking about maintenance of the coupled payments for tobacco, I have to refer to the answer I gave in the Committee on Agriculture and Rural Development on 24 June. I actually had the same opportunity to give the answer here in plenary on several occasions, namely that the Commission does not intend to re-examine the tobacco regime within the context of the health check. I will just repeat that the tobacco reform was agreed by all tobacco-producing countries in 2004, so therefore I see no reason to re-open this discussion. I hope that we can all agree that the money that will be transferred into the rural development policy, specially earmarked for support in those areas where tobacco production is taking place or has taken place, will be very important. We will also present to the Parliament a report on the consequences of the tobacco reform at the end of 2009.

 
  
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  Liam Aylward (UEN). – I am sure, Commissioner, that you – like all the other Members of the House here in this Parliament – are very frustrated at the manner in which Question Time is handled here. We have referred to that on many occasions, but nothing seems to happen.

I want to thank the Commissioner for the reply, even though I am not happy with the response given. If compulsory modulation is introduced, in my view it will create division and friction between the various farming groups, between big and small farmers and, in particular, between farmers engaged in different agricultural enterprises. I would not like to see that happening.

For example, in my recent sheep report which was adopted with a very large majority in Parliament here last month, I proposed that modulation and Article 69 (now 68) be introduced on a voluntary basis in Member States. Would the Commission not accept the spirit of that decision, which was made here just last month by the elected Members of this Parliament?

 
  
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  Seán Ó Neachtain (UEN).(GA) Mr President, it is the small farmers under the EUR 5000 payment limit who are faced with the greatest amount of problems but yet receive the least amount of money. Would the Commissioner accept that since this limit of EUR 5000 was set a number of years ago – 2002 I believe – inflation and large changes have come about? And would you not agree Commissioner, that it is a form of protection for small farmers to receive more now than when the policy was formulated and that the limit should be increased?

 
  
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  Ioannis Gklavakis (PPE-DE).(EL) Mr President, I wish to thank the Commissioner even though her answer was negative, because I know that she is a diligent, scrupulous and fair person, and I would like to ask her the following question.

Tobacco is the only agricultural product subjected to this type of treatment, and that treatment is unfair. However, I would like to add this: given that tobacco producers are poor, small-scale farmers, could you, in order to prevent them from vanishing, at least please carry out a study to help us see what these people could grow, now that tobacco is effectively eliminated under these measures?

 
  
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  Mariann Fischer Boel, Member of the Commission. − If you look at the proposal on the Health Check, it actually contains a number of actions to the benefit of the sheep and goat sector. First of all, we clearly state that it will be possible to maintain a coupled payment for the sheep sector because we are aware of the fact that it is a vulnerable sector. It is desperately important that we maintain some production in those regions where, if sheep production disappears, probably nothing will be left, so a coupled payment could be a solution.

I have to say, regarding the new Article 68, that it is a voluntary possibility for Member States to use and to top-slice up to 10% of the direct payment, and then, according to the decisions by the Member States, to transfer some of that money into the sheep or goat sector. The possibility of coupling the payment is valid both for suckler cows and for sheep and goats.

I am not sure if I understood the next question completely, but if you look at the budget – the overall budget for agriculture agreed by Heads of State in 2002 – this budget was fixed but adjusted with an inflation rate of just 1%. The honourable Member is right that we have an inflation rate higher than 1%, especially these days when we have high oil prices and high food prices so, yes, you can say the value of the entitlements is not completely following the value of other products. But this was a decision that was taken by the Heads of State, and therefore the present situation, especially in some sectors where we see an increase in prices diverging from what we have seen throughout the last 30 years, namely that prices are now starting to increase, is a sound signal for those that are going to make a living out of it.

I would say to Mr Gklavakis that we have had lots of discussions, and I always enjoy discussing this with him. I think he can go back to his constituency saying that he is fighting like a lion to maintain the coupled payment.

Tobacco production is not sustainable in all areas, but I think that, with the earmarked rural development money for the tobacco sector, it can also mean that those that want to maintain or to stay in business can modernise their tobacco production and maybe at the end of the day have a tobacco production that can be economically viable, because the quality of the tobacco will increase. I think that you have to face reality – the fact that this is not going to be re-opened – and then try to find the best possible solutions.

 
  
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  Wiesław Stefan Kuc (UEN). – (PL) Madam Commissioner, you are well known as someone who is always fighting to reduce production costs in agriculture. I have a question that relates to this issue. In our country, that is, in Poland, the government has recently imposed additional taxes on farmers who produce rapeseed oil for their own use and add it to fuel. This is, in a way, related to the production of biodiesel. As this is the same as paying a tax for drinking your own milk, or eating your own vegetables or potatoes, can you give these farmers assistance to continue their activities without the imposition of additional taxes as if they were buying this oil from outside?

 
  
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  Mariann Fischer Boel, Member of the Commission. − Since entering into European policy I have always been very keen on maintaining subsidiarity. This means that when we talk about taxation we are not discussing a common policy and therefore it is up to the Member States to decide on how they manage their taxation systems. Therefore, for various reasons, I had better keep out of – I would not say national infighting – but national discussions on how taxation on rapeseed is being managed. I understand your worries, but I would rather stay out of this discussion.

 
  
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  President. − Questions which have not been answered for lack of time will be answered in writing (see Annex).

 
  
  

(The sitting was suspended at 8.45 p.m. and resumed at 9.00 p.m.)

 
  
  

IN THE CHAIR: MR DOS SANTOS
Vice-President

 
  

(1)OJ L 12, 18.1.2000, p. 16.
(2)OJ L 270, 21.10.2003, p. 1.

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