Approval of the Minutes
President
The Minutes of yesterday's sitting have been distributed.
Are there any comments?

von Habsburg
Madam President, I would like the Bureau to address the following problem. We discussed the urgencies yesterday, which included a motion for resolution I tabled on the situation in Georgia. After the vote I discovered to my surprise that a letter, signed by an official of this Parliament, was sent to various Members - not to me, of course - on official Parliament paper, calling on them not to vote for it.
I would just like to know whether we have now reached the point where our bureaucrats can actually determine Members' voting behaviour. Would you please investigate this?

President
We take note of that, Mr von Habsburg, and I should be grateful if you could provide us with this letter.

von Habsburg
I have it here with me, Madam President.

Kerr
Madam President, on page 58 of the Minutes there is an account of an exchange between the President and certain Members concerning who is currently a member of the British Conservative Group. Unfortunately, the President's remarks have been edited and his full wit and humour have not been reflected in the Minutes. Could we have a full record? Could we have an assurance from the Conservative Group as to whether Mr Donnelly and Mr Stevens are currently members of that group or not? I gather that yesterday they came in and out several times. For the record, we should know what the current state is

President.
That does not concern the Minutes, Mr Kerr, but the Verbatim Report of Proceedings. It is the Minutes that we are currently approving.

Chichester
Madam President, my comment is also on the Minutes, because I note that Vice-President Martin was successful in having expunged from the record his comments about having to telephone No 10 Downing Street for instructions on how to vote. If that facility is available to Vice-Presidents - and good luck to him - is it available to other Members? By the way, Mr Kerr, the Conservative Group remains as it was yesterday.

President
That also does not relate to the Minutes, but to the Verbatim Report of Proceedings.

Hallam
Madam President, this is, of course, a reference to the Minutes - page 21. Mr Cassidy apparently crossed the floor of the Chamber. I would like some clarification from the Chair, because according to the Guardian newspaper today, John Stevens and Brendan Donnelly, members of the Conservative Group opposite, were expelled and then later reinstated by the Tory Party; they later resigned and then, after a hasty compromise, were persuaded to stay. Could somebody please tell the electorate in Great Britain whether these two people are now members of the Conservative Party or whether they are now independents?

President
Ladies and gentlemen, you are persistently confusing the Minutes wit the Report of Proceedings. We are only approving the Minutes here. We have heard what you said, but it would seem that no one else has anything further to say about the Minutes.

McKenna
Madam President, I wish to say, for future reference in this Chamber, that if Members want to behave like schoolboys, do it outside. Some of us have other work to do.
(Mixed reactions)

President
Everyone has their own way of seeing things.
(The Minutes were approved)

Mosiek-Urbahn
Madam President, you referred to the common position on the directive on consumer goods and guarantees. The Committee on Legal Affairs and Citizens' Rights was asked to deliver its opinion at the first reading. It should do the same for the second reading, but it was not mentioned.

President
We shall look into that.

VOTES
Lulling
Madam President, following the debate we had yesterday evening with the Commissioner, I should like to table an oral amendment to Amendment No 7. The other amendments can be put to the vote together. We actually asked for an independent evaluation of an independent evaluation report on the programme. The Commissioner said that it was the Commission's responsibility to produce this report and I understand that. I would like, with your agreement, to propose deleting the word 'independent' in the first subparagraph so that it reads 'will provide for a mid-programme evaluation ...' And in the second subparagraph, I would also like to delete the word 'independent' so that it reads 'shall provide for an appropriate evaluation report on the implementation of the programme', and adding the words 'taking account of the views of independent experts', as the Commissioner promised.
I would ask you to accept this oral amendment, which is justified, and with this amendment and your agreement, we can put Amendments Nos 7 to 14 to a block vote.

Lindqvist
It is very questionable whether the EU should devote large amounts of funding to the fusion research establishment, JET. It would be better to direct such funds to renewable energy resources. I have therefore voted against the report.

Pigmeat
President
The next item is the statement by the Commission on pigmeat.

Fischler
Madam President, ladies and gentlemen, to make things quite clear from the outset, the background to the difficulties we are currently encountering in the pig sector is probably the fact that 1996 and 1997 proved extremely productive years for the pig farmers, which led them to make enormous stock increases. Furthermore, with the decline in swine fever, products from the Netherlands are fully back on the market again. These two factors have increased European pig production to 17.2 million tonnes this year, an increase of about one million tonnes of pigmeat or 6 % more than in 1997.
This trend obviously exerts enormous pressure on the European pigmeat market. But the situation has become even more acute in the last few weeks with the almost total disappearance of the extremely important Russian exports, the falling demand in Far Eastern markets and the increasing competition from other exporting countries, especially the USA and Canada.
The Commission has taken a number of measures to support the pig sector. In mid-May we re-introduced export refunds for fresh and frozen pigmeat on the bone. At the time that stabilised the market for several weeks on end. But when prices began to slump again in late July, the Commission increased these refunds by 50 % and introduced the same refund rates for meat off the bone. That measure also had a very positive impact on exports.
But then, as I said, Russian exports fell drastically and were eventually blocked in mid-August, and European market prices fell by nearly ECU 10 per kilogramme in the space of three weeks. To protect exporters from direct harm, we thereupon began by prolonging the validity of export licences to Russia by 60 days. At the last meeting of the pigmeat management committee, it was decided rapidly to introduce private storage aids, which have been granted since 28 September.
This action allows the industry to freeze freshly slaughtered pigs at the Community's cost and to store it for four, five or six months. But when these products are taken out of storage, it is compulsory to export them to third countries. Part of the stored amounts, together with the expenditure on this action, however, come under the WTO export obligations for the pigmeat sector.
Under this action, some 70 000 tonnes of meat can be stored in the 1999 financial year. Let me stress that the traders can incorporate storage in their export activities in the appropriate way, which will also make them more competitive on third-country markets.
Some Members are in favour of a further increase in the refund rates and have called for that. In this regard, I would ask them to consider that it is pointless to increase them, especially for exports to Russia, so long as the Russian market remains completely closed and we have no partners there with whom to conclude export contracts; moreover, for the time being the other third-country markets do not need higher export refunds.
Of course we will follow further developments on the European pig market very, very closely and we will certainly discuss the matter further at the next management committee meeting, which is due to take place on 14 October. And as soon as the Russian markets open again, we will certainly review the refunds.
Let me conclude with a remark that some Members may not find very welcome. In spite of the current crisis which, as I said at the outset, can be traced mainly to the expansion of pig stocks, there are still, particularly just now, some official organisations, advisory services and also regional authorities and even governments that are calling on pig farmers to expand rather than restrict pig production. To be quite frank, I think that is bad advice. The Commission may be able to moderate and cushion the effects of a temporary rise in production, but it cannot protect the sector from price falls caused by structural overproduction.

Fantuzzi
Madam President, I think Commissioner Fischler's statement on the crisis in the pig sector showed a sense of responsibility and can be broadly supported. Our group recognises that the Commission has taken action, partly at the request of the European Parliament's Committee on Agriculture, in setting up this aid scheme for private storage as from 28 September and increasing export refunds. As the Commissioner said, these measures are certainly not going to resolve the entire problem, but they can help us to deal with one particularly worrying element of the crisis. The crisis is actually very uneven, because although a highly globalised market is a feature of the pigmeat sector, there are segments within the European market which are holding up better than others.
The situation is serious even though, as you have rightly said, Commissioner, producers in the sector have been making good incomes in recent years and the swine fever crisis which led to the adoption of rationalisation measures has been pretty well overcome. Now some very important producer regions - in France, Germany, Denmark, Holland and the United Kingdom - have seen prices collapse to an all-time low and that is why we should be very concerned.
The problem today is part of the international crisis affecting the world markets and the agri-foodstuff sector above all, and there are a number of possible routes we can take. But I do not think we should follow the route of throwing everything over and abandoning all the Agenda 2000 plans to reform the CAP, because this crisis on the world markets has thrown everyone off-balance. I am well aware that there is talk on the other side of the Atlantic of the United States re-opening the debate on the Farm Bill, because this crisis is also hitting American producers and calls for aid measures at the same time as measures relating to loans and financial guarantees. That could alter the rules of the game at international level and undermine European Union producers. But I do not think that this means we should give up; on the contrary, we need to deepen and extend the process of reform we have started, improving the internal market as well. In fact I think the proposals to reduce cereal prices could also help the recovery of the pigmeat sector.
Finally, this crisis must not be used as an opportunity to water down environmental measures and abandon supply policies which are more indispensable than ever, in my view.

Redondo Jiménez
Commissioner, you have just reported to us on the steps the Commission has taken to resolve this desperate pigmeat crisis. You also mentioned that one of its causes has been the huge increase in production. But clearly that growth has not been the same in all countries, so the solutions cannot be the same for a country where over-production stands at 104 % and for others where the level of supply exceeds 470 %.
The measures you described could be improved and there are others which you did not mention. An effort has been made on export refunds - we are pleased that boneless meat has been included - and also on the issue of private storage, but 70 000 tonnes is a very small amount especially considering that we have further reserves of over 600 000 tonnes from last year as well as the reserves from this year.
Furthermore, there are two other measures you did not refer to and to which I would draw your attention. The COM is operating in a free market, and we can tell you here and now that Article 3 applies. This article states that in case of exceptional price falls, intervention buying can take place, and the price cannot be used as an excuse - which is what the Commission's officials have done - because it is fixed in Article 5 in relation to the Community base price. So intervention buying can take place.
What is more, we have the Community food aid system, which could help all the NGOs, charities, the Dominican Republic - which has suffered a terrible disaster - and Russia too.
There are solutions, Commissioner. Let us be brave and take these measures. In an exceptional market situation exceptional steps need to be taken.

Mulder
Madam President, I should like to begin by thanking Mr Fischler for his statement, and I think the analysis he gave is essentially correct. A pig cycle is nothing new. Anyone here in the Chamber who knows anything of economics knows that pig cycles are mentioned in just about every economics book. What makes the present cycle special is that it has coincided with the crises in Russia and Asia.
I think that the pigmeat sector can generally be proud of the fact that it costs so little. Expenditure in 1997 was ECU 168 million out of a budget of ECU 41 billion, and in 1998 the figure is likely to be some ECU 330 million, which is an excellent achievement. I therefore feel that the special measures being taken are fully justified, since crisis situations call for special measures.
The Commission says that the root of the problem lies in the fact that pigmeat production has increased so dramatically. This is certain to be the case, since increased supply means lower prices. But is not the Commission's policy of reducing grain prices also to blame? And is the problem not simply going to get worse over the next few years when grain prices come down still further with Agenda 2000? What does the Commission think the effect will be on pigmeat production then? All the types of meat produced using a lot of grain will have a clear advantage over other types of meat, it seems to me. Does the Commission have any sort of long-term policy in mind here?
I have another question: if reports are correct, something like six to seven billion dollars of extra support are to be made available to American farmers in the run-up to the elections. What does the Commission intend to do about this? Is it going to react?
My final question is this: if the Dutch newspapers are to be believed, Commissioner Fischler has praised the Netherlands' policy on pigmeat production, which includes a quota system. Is the Commissioner in favour of introducing this throughout Europe?

Poisson
Madam President, Commissioner, we have witnessed a breathtaking drop in the price of pigmeat since the end of the summer both in the European Union and worldwide. The Community production sector, and particularly small family producers, are in a state of emergency. What has happened? First of all, Europe has overproduced, as you said, Commissioner, largely due to the irresponsible expansion of some farms. Supply in Europe therefore increased from 16 million to 17.2 million tonnes between 1996 and 1998, which is an increase of 9 %. At the same time, we have seen pig numbers in the United States increase by about 8 % in two years, which has allowed the Americans, who set unbeatable prices, to conquer the external markets to the detriment of the European Union: we are in the middle of an economic war. The situation is also explained by the Asian and Russian crises, which also deprive the European Union of a potential market. At present, we are seeing the consumption of pigmeat in the Community stagnate because of strong competition from other white meats.
The Commission must now resort to drastic remedies - as they say in my country -, otherwise the crisis will persist and drag on. Emergency measures are necessary. Firstly, the level of export refunds must be adjusted as needed to ensure that the markets can be recaptured, including the Russian market. Secondly, a promotion campaign should be swiftly launched within the Community to increase awareness amongst the general public and boost consumption in Europe. Thirdly, meat stocks in the European Union must be reduced by adopting the principle of humanitarian aid, particularly for Russia, yet without calling into question present commercial distribution and putting future distribution at risk. Fourthly, supply and demand should be controlled, as well as production, and farms should be managed rationally. Fifthly, we must ensure that the production of pigmeat is not transformed into a huge business that no longer has anything to do with agriculture, rural development and compliance with environmental standards. However, I fear that it may already be too late as far as this last point is concerned.

Jové Peres
Madam President, the origin of the current crisis in the pigmeat market lies in the supply and demand imbalance produced by the growth of industrial farming. On top of that the heavy reduction in exports resulting from the Russian crisis has made this a crisis of unprecedented depth.
The victims of this crisis will be small and medium-sized farms. The Commission ought to be proposing measures to correct this situation, using specific aid for small and medium-sized farms and disincentives against industrial farming.
All in all, the biggest problem is that the effects of the Russian crisis may also be repeated in other sectors. This is the most serious aspect in my opinion, and the Commission is leaving itself without mechanisms for managing this crisis because the only instrument it is planning to use across the board is private storage; this is to be the sole intervention mechanism in the majority of sectors. The social fabric of Europe's farming community cannot afford the destruction of its base - the small and medium-sized farms - or additional job losses. So it is the Commission's duty to correct the social impact of the structural crisis in pigmeat by providing aid for small farms and disincentives against industrial farming.
I want to draw attention to the most recent events, because if the Commission felt even the slightest sense of responsibility it would revise some of the proposals it is making with regard to the various COMs. Any COM worth its salt must have market regulation mechanisms for dealing with cyclical variations in production or short-term crises in all sectors.
My colleagues in the committee are right to call for exceptional efforts in the face of increasingly ineffective measures.

Graefe zu Baringdorf
Madam President, Commissioner, you should have begun with the observation you made at the end. Everyone in the pig market knows why we have this crisis. Our farmers' associations are still busily trying to encourage the growth of the pig sector and argue in their publications that we should at last reacquire the market shares which the Netherlands lost as a result of swine fever.
Of course, the same applies to the Netherlands as to other Member States. They are attempting to promote industrialisation in the pig sector, where possible with public funds. They want the resulting market pressure removed by raising export subsidies. The taxpayer who has to pay for it, the smaller undertakings and species-friendly stock rearing all fall by the wayside.
We must resist this attempt - and on this point I would contradict Mr Pérez, which also relates to the joint resolution, which we did not sign; we must not give in to this attempt to set up a common organisation of the pigmeat market with state intervention, which would eventually lead to constant surpluses here too. We must ensure that the market is cleaned up and dissociates itself from those who want it to expand and we must take measures to ensure that species-friendly stock rearing and small-scale pig-farming do not fall by the wayside.
That means that we must make it clearly understood by the Member States, at European level, that agro-industrial production is not entitled to privileges and may not be established in rural areas like other types of farm production, but must be treated as an industry; that means it may only be established in industrial areas and is subject to the appropriate emission rules, like those which other commercial and industrial undertakings also have to observe. Any privileges must go to farming based on land utilisation, which also applies to pig-farming.
We must also support the regional market. I personally am not affected by this crisis with my pig production - which is, admittedly, rather small - because I market directly. Nor am I affected by the collapse of the Russian and Asian markets, because my markets are on my doorstep; the people who want to buy from me - and who are not concerned about Asia or Russia, nor do they believe they ought to eat more meat because of the growth of agro-industrial production - stick to their standards, as I stick to mine. Nor have I expanded my production. So I think this is a homemade crisis. But it also shows the particular risks of gearing production to export and to the world market, because small parties then muddle up all manner of things that could in fact be regulated sensibly in the large single European market.
So I would ask you to let this pig surplus regulate itself and to protect those who must not be disadvantaged, namely small family farms, which might otherwise draw the short straw.

Nicholson
Madam President, firstly, I welcome the Commission's statement here this morning on the crisis in the pig sector throughout Europe. The fact that we received this statement means that the Commission recognises that there is a serious problem within the pig industry in the European Union.
In my own constituency of Northern Ireland, the situation is perhaps even worse than in other parts of Europe. It was aggravated by the loss of one of the processing factories due to a fire last June. I know the Commission is probably aware of this. This resulted in a massive backlog of pigs on farms during July and August. Despite politicians' best efforts, no resolution could be found to this problem, either within Northern Ireland, in the Ministry of Agriculture, Fisheries and Food in London, or in Brussels. No matter where we went, we were told 'we are sorry, everybody is on holiday'. The pigs did not go on holiday. They had to be fed and we had a serious problem. It is not very good to go to your constituents and say 'I am sorry but everybody is on holiday in Brussels'. While I appreciate that people are entitled to their holidays, in future there should be at all times an official of sufficient standing in every cabinet in Brussels who can make a political decision if a real crisis occurs in some part of the European Union. It does not enhance the image of the European Union when we have a situation like this.
I know there are no easy solutions. I know the crisis in Russia has aggravated the situation, but to simply start with the introduction of export refunds and aid to private storage is not enough. We need a better mechanism to recognise the problems before they arise. The pig industry is important. It keeps young people on the farms who might not otherwise be there. It also provides substantial employment off the farm. I fear the pig industry, in my particular area, is at a stage where it may not survive this present crisis.
I would ask the Commission to set up a task force to look into the situation and ensure that it is not repeated and that we can evolve a long-term policy for the future of pigs throughout the European Union.

Paisley
Mr President, the pig industry in Northern Ireland has been hit worse than all the other sectors in agriculture which are already in crisis, as the Commissioner knows. In the midst of the crisis the pig industry was robbed in one night of 40 % of its slaughter capacity and curing capacity. A new Malton factory costing £10 million was burned to the ground. An industry already in crisis losing 40 % of its capacity is in danger of total collapse.
What representation did the Commissioner receive from the United Kingdom Government about this dire emergency? What proposals for financial help were requested? In any other region of this Union, if this had happened and 40 % of an industry had been destroyed something decisive would have been requested of the national government and undertaken.
The pig industry is a jewel in the crown of agriculture in Northern Ireland. It is going to go under, as my colleague has mentioned, and cease to be viable if immediate aid is not forthcoming. With pig farmers contemplating suicide, and some committing suicide as a result of the problems, the situation is desperate.
I would press the Commissioner to send one of his officials to Northern Ireland immediately to assess for himself the tragedy and gravity of the situation. Agriculture is Northern Ireland's largest industry. It accounts for £2.28 billion of its trade and employs 10 % of the total civil employment pool. The whole industry is in crisis. Farm incomes have been slashed. In 1997 they were down 38 % from 1996, to £203 million. Finally, a further drop this year in farm incomes is expected, to the extent of £50 million. That is the gravity of the situation. We are looking to Europe to do something for us.

McCartin
Madam President, I raised this question originally. I am happy that a large number of people in this House and indeed, the Commissioner, are well aware of what the problem is and how serious it is.
It is not just a question of farmers failing to make a living. It is a question of farmers losing money rapidly and being in danger of having to lose their homes and entire business.
Farmers throughout Europe see the European Union as being responsible for agriculture. We spend 17 billion annually on arable crops. We spend 5 billion annually on beef. We managed to find 2 billion extra when the beef industry got into trouble even though the pig meat sector is twice as big - there is twice as much pigmeat consumed in the European Union as there is beef. In the dairy sector we spent 3 billion. We merely spent 300 million on pigmeat, a sector which is twice as big as beef.
It is extremely important that we take note of the situation and seek to find emergency solutions because this is an emergency. To my colleague, Mr Graefe zu Baringdorf, who thinks about these things seriously, I have to say that there are big factory farms involved, but the ones that will be there when this crisis is over are the big factory farms. The ones that are going out are the smallest and most vulnerable. We do not make a case here today for the large factory farms. We ask for emergency measures for the family farms that are in dire need. They will go down first as the crisis develops.

Anttila
Madam President, Commissioner, I thank Mr Fischler for his statement, which fully explained why the pig industry has reached this situation of overproduction. The Commission's decision to support private storage is right, but it is not enough on its own. To reduce the size of the pigmeat mountains we need a proper injection of aid for exports, so that surpluses can be shifted onto the global market. We have to find funding for that. In addition, pigmeat production must be cut in the EU in relation to consumption and the existing outlets for exportation. The responsibility for this lies with the Member States, which have been increasing their production beyond the level of consumption over the last two years. In a case like this, those governments that are still recommending increased production are being irresponsible.
In reducing production we have to stress the importance of the effect on the environment of production, and reduce production particularly in environmentally protected high risk areas. My question to the Commissioner is this: is it possible to spend EU environmental aid on reducing pigmeat production that puts too much of a burden on the environment? Balancing production is urgently required, as otherwise it will take place through a broad sweep of competition.

Querbes
Madam President, ladies and gentlemen, Commissioner, the crisis in the production of pigmeat is unacceptable for small and medium-sized producers. It must lead to joint action in the form of effective financial measures on the part of the Commission and the Member States, in order to enable farms to get through this ordeal without any difficulties.
Yet, at a time when Europe has a surplus of 600 000 tonnes, how can we allow authorisation to be given to set up huge factory farms that give rise to opposition from the surrounding population and the farmers themselves? Does Europe not need a moratorium on this type of farm? The present situation in Europe and in the world must, in fact, result in a policy aimed at controlling production through a genuine common organisation of the market. We need to ensure a decent income for small farms within the framework of small-scale production that generates jobs and guarantees respect for the environment and harmonious use of the countryside.
However, who within the Union's bodies will have the will and the courage to change the direction of Community agricultural policy and attack this extreme liberalism, which, according to the chairman of COPA, is at the origin of the crisis? Can we believe that the Commission is prepared to act effectively to that end and against the collapse of pigmeat prices when it proposes an identical price trend for cereals, milk, and beef and veal? Can we believe this when it proposes, with no real balancing mechanism, enlargement to include countries where agricultural prices are between 30 % and 60 % lower than those in the Union? And can we believe this when it relentlessly pursues this extremely liberal headlong rush by negotiating the opening up of the European market to the United States and to Mercosur? Is it not urgent to escape from this market dogma that regulates the market, and to send the idea of the reform of the CAP and Agenda 2000 back to the drawing board?
We are not starting with nothing. When adopting the Cunha report a few weeks ago on the reform of the CAP, our Parliament outlined the framework of another agricultural policy. It is a policy that is far more concerned with society's needs in terms of decent incomes, jobs, the quality of food and the environment, the balanced management of our territory and international cooperation. This is the policy that should now be at the centre of debates within the Council and within our Parliament.

Hallam
Madam President, like many Members here I have been in touch with pig farmers in my constituency during the last week. I found that many of them are close to financial ruin. People who have made a long-term commitment to producing a first-class product now suddenly find that pigs which previously sold for £34 to £40 are now being sold for £10 or £12.
They are not asking for subsidies or for charity. But they are asking for help. There are several ways in which our pig farmers could be helped. We could introduce an export credit guarantee scheme. We could look at assisted retirement from the market. We could look at ways of managing the rationing of new entrants to the market.
Referring to the point Mr Fischler made about the Russian market - Russia is in a state and our pig market is in a state. So why do we not make a gift to the Russian people at least of our lower value cuts of meat. Let us give it away; let us put it on to the Russian market; let the Russians use that meat to feed their people; and let us relieve pressure on our own markets.
There are other issues. British pig farmers have additional problems brought about by the unilateral adoption of stock-rearing rules. We must make sure that these are consistent across the European Union. We must also ensure that when imports come into the European Union they too conform to those rules.
Finally, rules on labelling should be tightened so that pigmeat can develop its own brand loyalty over time. This will discourage the vast supermarkets switching sources so that they can follow lower commodity prices. My pig farmers do not want charity but they do want a chance.

Santini
Madam President, the causes of this crisis have already been widely debated, but I would still like to make a modest contribution to trying to find some possible remedy. The immediate solutions, which have already been mentioned, are institutional and they are the simplest to apply: private storage and export refunds - but the Commissioner is avoiding the latter as impracticable, because lack of demand means there are no exports, so even the refunds would automatically fall.
What other measures could be taken? There is a danger that everyone is preoccupied with their own problems, so Member States' governments should be made aware that they must not take unilateral action - unidirectional action, I call it - partly out of panic and partly because of trouble-makers, since this would only have a palliative effect.
A second suggestion to the Commission is to take a firm hold of supply management, to get it back into balance and coordinate it. Then, considering the United States' close marking of the European Union on all issues affecting our international relations, why not counterattack, and find out if the United States really is breaking WTO rules by subsidising its producers?
Further proposals would be to carry out a careful investigation of the fundamental causes of the Russian and Japanese crises so as to prevent further ill-effects, and, finally, to ensure that the major agri-foodstuffs companies share the responsibility. In short, we cannot resign ourselves to the biblical prophecy about the seven lean years and the seven fat years. If four years of high prices are going to be followed by four years of low prices, it will be a catastrophe, Commissioner.

Hardstaff
Madam President, last Friday I too met with farmers in my constituencies. They all have great anxieties about the current catastrophic decline in their incomes, in particular those in the pig sector whose animals are fetching such low prices in the market that they are making a loss on every animal. British farmers, normally a very phlegmatic, law-abiding group of people, are far less prone to demonstrate than their opposite numbers in some other countries. For them to take to the streets, as they did at the Labour Party Conference in Blackpool last week, or blockade a port to stop pigmeat being brought into the UK, as they did in Immingham in my constituency a few weeks ago, things have to be desperate indeed.
Travelling around my Lincolnshire constituency I often see pigs out in the fields enjoying a very normal active life with high welfare standards. Their owners feel very bitter that the very low prices they are currently receiving for their pigs are not reflected in the prices of meat in the supermarkets which import meat raised to lower welfare standards.
Farmers need help now to get through to Christmas. A number of short-term measures can be taken quickly to ease the situation. Export refunds will help the market by assisting producers to find new markets outside the EU. Private storage aids can relieve an over-supplied market in the short term. However, when released, such meats should be exported or used as emergency supplies outside the EU - possibly to Russia, as has been said - to avoid recreating the problem of over-supply.
Export credit guarantees can help exporters to reduce risk and compete outside the EU with more confidence to find new markets. An intensive marketing programme throughout the EU similar to that introduced for beef two years ago, for which I wrote the Parliament's report, could also play a significant role in boosting consumption and thereby reducing surpluses. There also needs to be help for farmers wishing to retire from the sector.
Measures should be the same throughout the EU to ensure no one Member State gets an unfair advantage. Through you I urge the Commission and the Council to reach decisions and take urgent action following the meeting on 14 October. Europe's farmers need help now. They cannot wait another two or three months for action.

Funk
Madam President, Commissioner, although it has all been said, not everyone has spoken yet. So I shall be very brief. I want to address four points. One, pig prices for farmers have fallen more sharply than the prices passed on by the trade. That too needs pointing out. Two, the Commissioner said nothing about evaluating the results of the recent pig counts. After all, he must have good figures here since his expert on pigs learnt his trade on my farm. That is why he is such a capable man - let us say that quite plainly here!
Three, now would be the best opportunity, and here I agree with Mr Graefe zu Baringdorf, to implement the directive on nitrates and to look into the excessive stocks of animals in the Community, so that we can bring them back to a normal level and establish a sensible ratio of fodder land to land spread with liquid manure. This is the best opportunity to do so. I am doing so, obviously. We have all been doing so for ages. Only the Lower Saxons are, of course, very backward here. And nevertheless one of them has actually become Chancellor of Germany. That just goes to show the possibilities in our country!
Four, it needs to be checked to what extent the sharp fall in the grain price has had an impact on or stimulated the processing industry. The farmers are seeking higher value creation. That is quite clear, and then we shall never be able to resolve this dilemma.
(Applause)
Filippi
Madam President, there are two points I would like to make, but first I would like to make it quite clear that I welcome the fact that we are debating this issue this morning and I think that a number of measures are needed to help get us through this difficult stage.
To be honest, Commissioner, your latest statement did not surprise me, and I think we ought to distinguish between the structural causes underlying this crisis and the circumstantial causes which have aggravated it. The Russian market, for example, has exacerbated a crisis engendered by over-production and the misguided policy some Member States have been pursuing.
This policy must be corrected because it threatens to penalise even areas which are traditional producers of pigmeat used primarily for quality products - for processed products like ham, salami, etcetera - which risk paying the price of errors in the calculation of demand.
The second point I want to make is that we should only intervene with contingency measures, and we should try not to use this crisis to move towards regulation of the sector, which up to now has managed fairly well without subsidies. We must try to avoid going down the road of traditional assistance because of a short-term crisis in the sector.

Fischler
Madam President, ladies and gentlemen, I want to thank you warmly for this debate. I was asked whether I can show you the trend in production. Production in the first six months of 1998 compared with the same period in 1997 was as follows. In the Netherlands, production rose by 17.9 % - as I said, that was mainly due to the swine fever the year before; in Spain by 7.8 %, so that Spain is now the second pig producer in the European Union; and in Portugal it is also over 7 %. But in some countries production actually fell, for instance in Italy, Luxembourg and Finland. In Germany it rose by 4 %.
Let me now briefly answer the questions you raised. On the specific question of the fire in Northern Ireland, let me say that, firstly, the UK Government has requested a national subsidy for this, which is currently under consideration. Secondly, according to our information that firm has now bought a replacement slaughterhouse. Thirdly, if structural aids for reconstruction are needed, they must be given under the structural programmes. Fourthly, do not say we were not available! In fact the matter was discussed with my services twice in August!
To turn to Mr Hallam's question about giving food aid to Russia. I believe that first of all we should talk with the Russians themselves. It would certainly be counterproductive to make an offer - as some have already tried - when the Russians want nothing to do with it. So far the Russian Government has declared that it attaches priority to the resumption of normal exports to Russia. Moreover, if we considered such aid, we would first have to reach agreement at international level, to ensure that a food aid programme was not charged to our exports, landing us in further difficulties. Above all, we must determine how this kind of programme would be financed.
So we are not against this kind of programme on principle, from the outset and under all circumstances, but first the conditions need to be determined. We also consider it extremely important that, in the event that we grant this aid, we also receive guarantees that it will go to those in genuine need and not just to anyone.
On the question of price consistency from the producer price to the supermarket price, if you find that this is not the case in your country, the fault lies in weak competition and not with the Community; it is in fact up to the consumer associations and other organisations to ensure this consistency.
I come now to the more long-term aspects. In our proposals in relation to Agenda 2000 we considered the probable future trend of competition between pigmeat and beef. Because we think that pigmeat, like all white meats, will have more advantages than disadvantages in future, we believe that is precisely why beef prices must be cut more drastically, to maintain a balance. The trend of demand is more towards pigmeat. I do not think when you add up the figures here that you should look at the billions the Community pays for field crops separately and pretend that it has nothing to do with pigmeat. Quite logically, many pig producers in fact receive farm premiums because they produce their own cereals and fodder.
On the support for American producers, President Clinton has announced that he will give more support for American agriculture as a whole - which is indeed facing a serious crisis at present, especially grain cultivation. But of course the same applies to the Americans as to us: they must comply with the agreed GATT undertakings. Of course we will monitor this very carefully. Should we find at any point that this is not the case, we will take the appropriate steps.
I must admit I see the question of a world market orientation rather differently from the way it was presented a moment ago. Obviously we do not want to disturb the local or regional markets which, as Mr Graefe zu Baringdorf described so graphically, continue to operate independently of the crisis; on the contrary, we want to strengthen and support these regional markets. But we cannot market the entire European production solely on regional markets, for there happen to be others too, and we cannot simply disregard them.
I agree with him on one point, which brings me back to Mr Mulder's question. The proposal on reducing stocks in the Netherlands is directly linked to the directive on nitrates. The Netherlands is attempting to implement the nitrates directive in relation to pig production, and that is also how the Netherlands Government presented the matter. But you all know that many Member States have still not implemented that directive. I am quite willing, following the debate here today, once again to request the appropriate services and my colleague Mrs Bjerregaard to make the appropriate approaches to the Member States on this subject, for in my view that is the best way to protect indigenous production in Europe.

President
Thank you, Mr Fischler.
The debate is closed.
We shall now proceed to the vote.
Joint motion for a resolution on the crisis in the pigmeat sector
(Parliament adopted the resolution)

van Dam
Madam President, pig farmers are quite familiar with the phenomenon of yo-yoing prices, and it is not for nothing that we talk about pig cycles in economics. The decline of the substantial Russian market has produced the very serious problems which the pigmeat sector is currently facing, and I therefore welcome the fact that the European Parliament has made a statement on the subject. We support the calls for the Commission to take further measures and we voted for the resolution.
But what do we mean by further measures? The general wording of the recommendations indicates that Parliament still has very different ideas about this. One idea is to introduce a subsidy regime for slaughtering piglets, like the Herodes premium for calves. We resolutely oppose this as being ethically unacceptable and bad for the image of the sector. Other possibilities mooted include intervention for pigmeat and reducing the slaughter weight. We have our doubts about both of these, since they would involve changing the entire organisation of the pigmeat market, which would take some considerable time. It seems to make no sense to change a light-handed system into a heavy-handed one just because of the current crisis.
We would advise the Commission to make optimum use of the existing instruments, even though they are restricted to the light-handed system. But by using the private storage scheme and increasing export subsidies the Union could do a lot to help solve the problems. The Commission must also be very careful to ensure that the support measures introduced by the various Member States do not contravene European rules. An especially hard line must be taken with Member States which have unilateral support systems, such as interest-free loans and help in maintaining surplus production. That is just counterproductive.

Barthet-Mayer
The ARE Group has not signed this so-called 'joint' resolution, tabled by the PSE, PPE, UPE and GUE/NGL Groups. This resolution has surprised us by its lack of bite. In fact, the text seems to us to accurately take stock of the present crisis in the pigmeat sector, but it is nonetheless hollow. Above all, this resolution refrains from drawing lessons from the crisis and is devoid of any concrete proposals, which are, however, necessary and urgent for the farmers directly affected by this crisis.
This crisis could have been predicted: it resulted from the combination of an uncontrollable industrialisation of pigmeat production, attractive, artificial prices that were maintained for four years, thereby encouraging overproduction, and the absence of a genuine European policy to control production. The sudden drop in pigmeat prices coupled with the loss of export markets, particularly following the Russian crisis, are only symptoms of the structural weakness of the sector, which has been created by the absence of political will and a certain amount of vote-catching. Each crisis in the pigmeat sector forces out the smallest farmers to the advantage of the factory farmers, who themselves are primarily responsible for the present situation.
It is not with the modest and timid proposals in this resolution - which merely calls for the blind perpetuation of the present system without even calling into question the foundations of the policy implemented until now - that the Community will be able to respond adequately to the concerns of farmers. The ARE Group had proposed taking clear measures with a view to controlling production effectively and on a long-term basis. The decentralisation of production, which would allow quality to prevail over quantity, is also amongst our priorities.
With this in mind, the group is in favour of the Commission maintaining the ban on subsidies designed to increase production capacity in areas with a structural surplus. The Commission should be encouraged to favour aid to the producer aimed at promoting extensive farming methods that respect the connection with the ground and that use feedingstuffs originating in the Community.
Finally, the ARE Group considers that any specific measure concerning aid to the sector must be dependent, in accordance with each region's particular needs, on measures relating to marketing, processing, the protection of the environment, the decentralisation of production and the conversion of companies. It must also form part of a global strategy to control production and achieve quality.
We will, however, be voting in favour of this resolution as a sign of our concern for the scale of this crisis and our solidarity with the farmers affected.

Sindal
The Danish Social Democrats voted for the joint motion for a resolution on pigmeat today. We did so taking the view that the resolution is acceptable overall. Certain products which are exported to the Far East, for example, do not qualify for export refunds. This amounts to discrimination against the producers concerned. We therefore favour support for the private storage of products that do not qualify for export support. In the longer term of course, we think that the best way of bringing about balance on the market is to give the animals reasonable conditions and to care for the environment. We favour a reform involving the alignment of prices to world market prices and a reduction in export refunds.

Souchet
The pigmeat market is characterised by over-supply. In fact, EU exports to the Asian and Russian markets account for almost 40 % of the total volume of exports to third countries. Both markets are experiencing particularly worrying economic situations and are no longer in a position to stock up with the same quantity of supplies as before.
On an internal level, an epizootic disease (swine fever) was certainly rife during the past two years in two Member States: the Netherlands and Spain. However, through the near eradication of this disease, production in both these Member States has returned to the level of previous years.
While the emergence of a surplus could have been predicted, the Commission, rather than analysing the inadequacies of the COM for pigmeat, instead quoted us the case of pigmeat production as an example to justify its proposal to reform the COM for beef and veal (private storage, abolition of public intervention, reduction of production prices, etcetera).
Here or elsewhere, it is good form to systematically condemn the increase in agricultural production and particularly that of off-land units, as has occurred notably in the area of pigmeat production. However - and I think it important to point this out -, it is not the farmers who are responsible for this situation. For many years, the Commission has implemented a policy that favours this increase in regions close to the provision of feedingstuffs. We know that to produce pigmeat at competitive prices on the world market, the cost of feedingstuffs must be reduced as far as possible. By favouring the imports of proteins of crop origin, such as soya cakes, manioc, etcetera (the European Union only provides 15 % of the proteins of crop origin it requires), and the imports of cereal substitutes (corn gluten feed) without any import duties, the European Union has a direct responsibility for the concentration of farms around supply ports along its western coasts. The competitive advantage of these coastal production regions has been such that production in Europe has been completely relocated and concentrated in limited areas - the Netherlands, Belgium, Brittany, Denmark -, leading to the consequences we are now aware of in terms of the environment and risks of epizootic disease.
However, this increase in production has also had a perverse effect on the farmers themselves. In fact, they have had to make large investments in high-technology animal housing. When analysing the situation of agriculture in France, for example, we see that pigmeat producers are among those farmers most in debt. During the market depression that we are experiencing, they are obliged to produce, even at a loss, and to sell at very low prices.
What is the situation like for the consumer? Now, after several weeks during which the price per kilo has remained lower than FRF 6 per kilo of live weight, consumer prices are still the same. In actual fact, the middlemen are profiting from this situation and are not passing on the decrease in the price of the raw material to the advantage of the consumers.
I do not want to finish without emphasising the serious repercussions for farmers of certain insufficiencies on the part of the Commission. Our colleague Jim Nicholson, a Member from Northern Ireland, has told us about the dramatic situation experienced by his region this summer, as a result of the Commission's incompetence. In Northern Ireland, one of the two slaughterhouses for pigs was burnt down during the summer and was no longer able to slaughter of pigs. The one remaining slaughterhouse, although running at full capacity, was unable to compensate for this problem and the farmers could not have their animals slaughtered. It was therefore necessary for the Commission to authorise the slaughter of pigs from Northern Ireland in the Republic of Ireland. But the Commission was on holiday. There was no-one in charge in Brussels. No-one was able to take a decision. Everything was blocked. And during this time, the animals exceeded their optimum weight. This tragic situation shows us once more the negative effects of a technocratic type of decision-making system, which is very far from the real world.
Finally, I should like to point out here the significance of a proposal put forward by our colleague Edouard des Places. In the opinion he delivered last year on the Agenda 2000 communication, he pointed out that it was necessary to introduce the principle of income insurance. This system has the advantage of being authorised under the GATT-WTO agreements. Yet, as the Commission regulations on Agenda 2000 are gradually being put forward, we note that this proposal is still not present. However, if pig farmers had previously been able to take out this type of insurance - cofinanced by the European Union - when prices were higher, it would have been easier for them to deal with the market situation we are experiencing now. Instead of a reform of the CAP and main COMs based on a reduction of prices and its partial compensation through allowances, we call on the Commission to seriously and quickly consider creating new tools that enable farmers to have stable incomes.
Is the Commission capable of imagining anything other than the progressive dismantling of the CAP that it is currently implementing? Is it capable of presenting European farmers with any other prospects besides that of merely enduring the fluctuations in the dollar and the changes in world prices for agricultural raw materials? If the answer is no, then the transfer of powers from which it has benefited is no longer justified.

The euro and the CAP
President
The next item is the report (A4-0320/98) by Mrs Schierhuber, on behalf of the Committee on Agriculture and Rural Development, on:
I.the proposal for a Council Regulation establishing agrimonetary arrangements for the euro (COM(98)0367 - C4-0406/98-98/0214(CNS)); II.the proposal for a Council Regulation on transitional measures to be applied under the common agricultural policy with a view to the introduction of the euro (COM(98)0367 - C4-0407/98-98/0215(CNS)).
Schierhuber
Mr President, Commissioner, ladies and gentlemen, the introduction of the euro in the European Union brings many changes, adaptations and adjustments with it, which also affect agriculture and the existing agrimonetary system. The system we have had hitherto served to absorb currency fluctuations, which could affect farm incomes. It tried to keep incomes relatively stable by an extremely complex and expensive method, the fictive conversion rate known as the 'green rate'.
With the single currency, this compensation mechanism will no longer be needed in the euro zone in future. On 1 January 1999, once exchange rates have been fixed, this cumbersome system will disappear. However, an agrimonetary system will have to be retained for those states which do not participate in the single currency. That is why the Commission is proposing to suspend the existing agrimonetary system regulations and replace them with two new ones. I believe the Commission has developed a good system which, as I said, is much easier to handle and in the end will also be cheaper.
These new regulations are to regulate, firstly, the transition from the existing system to the new one and, secondly, the system to be applied between the ins and the pre-ins. Let me emphasise at this point how important the introduction of the euro is for European farmers, since they in particular need a stable currency environment. Let me also point to the huge depreciation of the lira that occurred in 1995, which did great damage to Austrian farmers and others.
If incomes are no longer exposed to the risk of currency fluctuations within the euro zone, I believe that will improve security on the internal and third-country markets.
Let me say a few words on the new agrimonetary mechanism for the pre-ins. The Commission makes a distinction between prices and other subsidies on the one hand, and direct aid. Since not every minor currency fluctuation can immediately be compensated, a margin was set. For prices, it was decided that only an appreciable currency revaluation of not less than 2.6 % gives rise to an income loss, which in the end would also be compensated. In the case of direct aid, this rate is 0.5 %. On the 2.6 % rate I would add that it already applies in the current system, as recently decided in a Council regulation.
On innovations in the financing system, here too there is a difference between prices and other subsidies on the one hand, and direct aid. In future too the Union will grant 50 % of direct aid contributions, even if the Member State does not pay its contribution. It is a different situation with prices: in future they will only be granted if the Member State cofinances an equal share.
The successive payments are on a degressive scale and end after three years. Broadly speaking, the same system applies when the 'in' states adjust to the euro, i.e. at the time when the exchange rates are fixed. Let me just emphasise that in the first year the Union will pay 100 % compensation for direct aid where a currency has appreciated by at least 0.5 %.
The introduction of the single currency is an important and significant step towards further development and integration in Europe. It brings us a step closer to completing the single market. Personally, I do not regard the European Union as just an economic community but also as a community of solidarity. That is why I support the Commission's proposed aid for farmers in those Member States that are not joining the single currency. They should not derive any advantages from that, nor disadvantages either, for the farmers must not be the ultimate losers because their governments have decided not to join the euro for the time being. As I said, in the end the reorganisation of the Community budget will save much money. But the financing of a rational transition must take account of the farmers' needs.
Finally, I expect and hope that if any unforeseen difficulties arise on the date of introduction of the euro, the Commission will respond rapidly and efficiently.

Wilson
Mr President, the single currency - the euro - will, of course, save a great deal of money: most European Union countries will not require agri-compensation payments after 1 January.
The 'green rate', as we know it, will go and for the countries not in 'euroland', the staged currency fluctuations of the present green pound will end and be replaced by a currency exchange rate based on the declared daily rate.
The European Union countries not in 'euroland' will have a compensation formula until the year 2002 - for the next three years. I am concerned about ensuring that farmers requiring compensation will not have that compensation payment delayed. If our aim is to help when farming income drops, it will not help if the payment is delayed until after the farmers have gone bankrupt. The proposed direct aid, when there is a revaluation of over half a percent, must be received by the farmers and not too late to help them.
One point we must address: my country, the United Kingdom, is now suffering from the high pound on international currency exchange rates. Cheap imports are flooding in and we have economic problems. The same situation in 'euroland' could happen if we develop free trade with North America. We really have to think of the cost to the common agricultural policy in our negotiations.
To conclude, I respect the amendments tabled. I think we will agree. I congratulate the rapporteur.

Funk
Mr President, Commissioner, of course I fully support what Mrs Schierhuber has described to us so excellently. She also raised a number of points into which I would like to go in more depth.
It is quite plain that agriculture has suffered most from fluctuations in currency values and therefore also had to accept considerable income fluctuations and falls. But I have been struck by a document published by the German Bundesrat to the effect that the current compensation rules are not fair and cannot adequately protect farmers from the losses to which Mr Wilson has also referred.
This document starts from the assumption that 1 % compensation represents DEM 600 million, and we are working with a fluctuation band of 2.6 %. So in any country where this 2.6 % fluctuation band is breached, say in Germany, agricultural prices could face losses of 1.5 billion - according to the German Bundesrat.
So, of course, I pricked up my ears and said to myself that I must put that before you here. I would not like to stand up in front of my people and be asked why nobody said a word. So I would now ask you and your watchmen: could this happen, and would that not mean that the compensation had to be renegotiated?

Anttila
Mr President, Commissioner, congratulations to Mrs Schierhuber on her important report. According to the Commission's proposal, the Community will be making, in the form of direct aid, a 100 % compensation payment for lost income in the first year to all Member States outside the euro area. I see this proposal as establishing some sort of precedent. When new member states are admitted to the Union, they will hardly be coming straight into the euro area. I should like to ask whether we will be recompensing these countries too with an automatic 100 % payment in the form of direct aid to make up for loss of income arising out of fluctuations in currency values in the first year?
The national currency used to be one means of protecting domestic production of food. Now the euro is laying bare differences in competitiveness and food prices within the EU. The steady 7 to 8 % fall in the value of currencies like the Swedish krona and the Danish krone, which are the currencies of non-participating countries, compared to, say, the Finnish markka, give these countries a competitive edge in production. Now, according to the report under discussion, the risk that the agrimonetary scheme will cause distortion of trade is being removed. However, the countries outside the euro area are gaining a competitive edge stemming from fluctuations in the value of currencies, which to my mind have not been sufficiently explained in preparing for the euro. I would like to ask if the Commission intends to monitor the changes in the value of currencies outside the euro area and their effects on the competitor counties, i.e. the euro area. Finally, I would like to say that, apart from Germany, Finland's main competitor countries - and the ones we export to most - are those very countries remaining outside the euro area, and in that respect this matter is extremely important for us. Otherwise, I think the euro is a perfectly good thing. It allows us to protect ourselves from a currency market that is now in turmoil.

President
Thank you very much, Mrs Anttila. Ladies and gentlemen, I am going to call Mr Hallam now, but before I do I must inform him that the Chair noted his absence on the Friday of the last part-session.

Hallam
Mr President, the reason I was absent was because I went to a selection procedure which I subsequently failed and I will probably not be a Member of Parliament in future. It was quite a poignant fact that I was away on that particular Friday. Nevertheless there are ways in which politics move sometimes that are quite mysterious.
I would like to endorse my colleague, Mr Wilson, and certainly the comments by Mrs Anttila about some of the concerns that we, in the pre-in countries, have about the way in which the monetary system will work following the single currency. I also want to place on record some of my concerns about some of the things you may have been hearing about British politics in terms of the way in which the Conservative Party - the main opposition party - has now decided to slam the door on the euro forever.
I still have my reservations. I have always believed that John Major's policy of 'wait and see' was actually a sensible policy. I am very concerned that by appearing to slam the door forever, the opposition party in our country is talking down jobs in my constituency. We need foreign investors in places such as Telford, north Shropshire, Hereford, Ross-on-Wye and Wyre Forest. I know that the news that a major opposition party is slamming the door on the euro forever is going to have a detrimental effect on future foreign investments.
Quite clearly, these people only speak for a tiny minority now. I want to make it clear to the House that the British people are waiting, looking very carefully and considering. There is growing pressure, from British businessmen in particular, to join the euro.

Lulling
Mr President, Commissioner, you put proposals before us for a radical reorganisation of the agrimonetary system in good time, some months ago. That will indeed be necessary with the introduction of the euro as a single currency and you did not need letters from Members, which were presumably only aimed at the gallery and at currying favour with the farmers, to point this out to you.
Those familiar with the admittedly extremely complex system of agrimonetary compensatory payments knew these payments would no longer be necessary for farmers in the euro zone, as our rapporteur, Mrs Schierhuber, explained very clearly. However, they may still apply to farmers from what are called the pre-in Member States if their currencies are revalued against the euro.
I think that is crux of the matter. I want to know why a Member State that deliberately does not join the euro can be eligible for 50 % of any compensatory amounts out of Community funds and why that Member State can even be exempt from contributing its national share of subsidies. With the introduction of the euro the entire agrimonetary problem could, after all, disappear overnight and we could save far more money. I would certainly not want farmers in countries that do not want to join the euro to be penalised. Yet I do not see why those countries' decision not to join should possibly cost the other Member States hundreds of millions. I believe we should see whether we cannot find a solution in the EU financing framework, because these countries cannot have it both ways.

Gillis
Mr President, I would like to thank the rapporteur Mrs Schierhuber for this report. The introduction of the euro on 1 January 1999 as the single currency for Europe will add greatly to the integration of the Union. It will give the in-countries a huge boost and for countries like Ireland, which exports a high percentage of its total agricultural production, the euro will reduce costs as there will no longer be a need for conversion when the euro becomes a means of payment in its own right and not just a unit of account like the ecu.
The CAP will be much simpler to operate and will be a lot better for farmers. Food exporters, trading on both the EU and third-country markets, will have the distortions of trade caused by agri-monetary and conversion factors eliminated from their contracts, thus reducing their risks and costs. I welcome the excellent preparation work by the Commission and the real possibility of saving over one billion euros per year to the EU budget. But as the report shows, different mechanisms are required for the in-countries and for the non-participating Member States. This fact once again highlights the trade difficulties Ireland will experience in its dealings with the UK, as a result of the UK's refusal to participate. Clearly the sooner the United Kingdom decides to join in, as I believe it inevitably will, the better for all of us.

Fischler
Mr President, ladies and gentlemen, first let me offer warm thanks to the Committee on Agriculture and Rural Development and, in particular, to Mrs Schierhuber, the rapporteur, for this excellent report. I am glad that the rapporteur and the committee have endorsed the Commission's main reform aims, which are as follows. Firstly, we want to make the existing regulations much simpler. Secondly, with the introduction of the euro and the new currency situation that will produce, we want to adapt the existing rules. Thirdly, we want a system that adjusts to any given market situation and, not least, we want to prevent any farm income losses.
As a means of achieving these aims, the Commission has proposed abolishing green exchange rates and replacing them by specific conversion rates for those Member States that have not yet joined the euro and by irrevocably fixed conversion rates for those that have. Similarly, for the pre-ins, the system of definitive facts is to be continued and that of agrimonetary compensatory amounts retained with minor changes. I am pleased that the European Parliament welcomes all these proposals, as also emerged in the debate on the Langen report on Tuesday.
Mr Funk expressed some reservations in regard to the margin of fluctuation and the threshold level. The 2.6 % margin of fluctuation is nothing new; it already exists within the present system and is already being applied. This threshold is, in a sense, the counterpart to the flat-rate calculation of income losses resulting from falls in prices or in the non-direct subsidies in the respective national currencies. The flat-rate approach produces more risk of overcompensation, which is why we have set the margin at 2.6 %.
But that in turn has nothing to do with the 0.5 % payment threshold, which also already exists under the present system. This threshold is simply designed to prevent compensation having to be paid for very minor income changes, as otherwise we would face the absurd situation of administrative costs being higher than payments to the farmer.
All in all, the Commission's proposal is an example of how simplifying a proposal can also make it more transparent and intelligible.
I turn now to the amendments, which with one exception concern only the recitals. I note with satisfaction that the rapporteur endorses all the other articles. But since the recitals have a close bearing on the articles themselves and were drafted with that in mind, and since moreover they say only what is absolutely necessary, I would prefer to retain them in their existing wording.
I would just like to bring up Amendment No 6, on the use of the euro by the pre-in states. That is an important aspect of the proposal. The amendment seeks a wording which is not at present consistent with the corresponding article. Yet the Commission is quite prepared to raise the reservations expressed in that amendment during the Council discussions.
On Amendment No 8 to Article 4, I still maintain that it should be up to the Commission and the agrimonetary committee to change the criteria for adjusting to the market situation when calculating cuts in agrimonetary subsidies. After all, these are purely technical adjustments, which it is important to undertake very quickly to prevent the situation that was complained of earlier, namely delays in the calculation and payment of the subsidies. That is our only intention here.
To conclude, let me thank Parliament again for its kind support for this reform, which will ensure that the common agricultural policy can adjust completely and promptly to the great milestone that monetary union represents in the construction of Europe.

President
Thank you very much, Commissioner. Before we move to the vote, I would ask you to take a minute to listen to a speech from Mrs Schierhuber, who has asked for the floor as rapporteur.

Schierhuber
Mr President, Commissioner, I have listened very carefully to what you said. The Committee on Agriculture and Rural Development, which adopted all the amendments unanimously, had not actually intended to change the text, i.e. the Commission proposal, but simply to give it more depth. In that sense, I would ask you to reconsider this at a suitable opportunity.

President
Thank you, Mrs Schierhuber.
The debate is closed.
We shall now proceed to the vote.
(Parliament adopted the two legislative resolutions)

Souchet
The I-EDN Group voted for this report because the six amendments that it had proposed in committee were adopted.
These six amendments stress that one of the fundamental principles of the CAP is that of equal treatment of the farmers of the EUROPEAN UNION Member States. They also emphasise the need to ensure that the introduction of the euro does not penalise the farmers of the Member States and particularly those of the Member States that have to integrate the single currency.
It has been said and repeated too often that farmers would benefit from the euro due to the absence of so-called competitive devaluations. In fact, when we examine the Commission proposals, we see that no study has been carried out on the impact of the euro on farmers' incomes. What is even more surprising is that these proposals state that no compensatory aid will be granted when this amount is less than 0.5 % of a revaluation, nor in respect of amounts to which a rate lower than the new rate was applied in the 24 months before the entry into force of this regulation.
Yet what are we seeing at present? We are witnessing a global financial crisis that started this summer. The repercussions of this crisis are already significant as far as the parity of currencies is concerned, that is, those participating in the euro and the dollar.
We know that world prices for agricultural raw materials are fixed in dollars. A strong euro will therefore penalise European agricultural exports. What will our farmers do when they see their prices go down in euros, even if the basic prices in dollars remain stable?
In the Commission proposals on Agenda 2000, the only issue is that of lowering prices and therefore significantly reducing farmers' incomes, given that the allowances in compensation will only be slightly revalued before the WTO negotiations.
I therefore fear, like all the members of my group, that European agriculture will suffer a great deal from the introduction of the euro. Under these conditions, what will the future of the rural areas of Europe be like as a consequence?
Instead of asking this question, the French National Assembly is currently debating, in a completely surrealistic manner, a basic law on agriculture introducing territorial contracts for farms, which aim only to encourage farmers to become local agricultural civil servants. But that is another story! I am in any case very afraid for the future of a profession that is the cement of our European society.

Agricultural products and agri-foodstuffs
President
The next item is the report (A4-0280/98) by Mr Mulder, on behalf of the Committee on Agriculture and Rural Development, on a quality policy for agricultural products and agri-foodstuffs.

Mulder
Mr President, when we talk about Europe's agriculture policy these days there are two main strands to the discussion: firstly that the agricultural policy needs to change and, secondly, that the food we produce needs to be safer and more animal-friendly. The European Parliament's Committee on Agriculture and Rural Development is trying in this report to give the discussion a certain orientation. First of all, the Commission has clearly stated that whatever proposals may be made about income subsidies, the average farmer and grower will always prefer to derive his income from the market rather than by filling in all sorts of forms to obtain a subsidy.
One of the possibilities we see for improving prices is to put the emphasis on food quality rather than quantity. This is something that the Commission has already acknowledged, and it is hardly a new idea. The Commission put forward proposals on organic vegetable production in the early 1990s and there will soon, we hope, be proposals on organic animal production. But how we can actually change market trends is another matter, since organic products currently account for only 2 % of the European agricultural market.
The second Commission proposal is to place greater emphasis on regional products. We in the Committee on Agriculture and Rural Development think this is an excellent idea, since we agree that there needs to be a much greater focus on such products, and they need to be marketed more vigorously, allocated promotional funds and so on. There is certainly room for improvement here, as regional products currently account for only a very small percentage of the market, some 8 % if the Commission's figures are correct. This means that 90 % of all Europe's agricultural products reach the market at various stages of production. Some producers are heavy polluters, others are not, and the market has a certain influence here. There is a wide range of quality marks in Europe, some 1500 or so, on which the Commission has just carried out a study, I believe. The ones that stand out are those relating to integrated production, which is currently starting to develop all over Europe. The concept here is 'from the stable to the table', with every stage of production being monitored. We in the Committee on Agriculture and Rural Development feel that this form of production should be encouraged.
The consumer wants to know what he is eating, and farmers like to know what production standards they have to meet. It will also make the huge range of quality marks slightly more transparent if there is one common European mark. This is the thrust of the main section of the report. We are calling for a European quality mark for the top end of the remaining 90 % of the market. It does not mean that all existing national, regional or other quality marks should be dropped. Everyone is free to produce what they want, but if certain claims are made they must be checked out.
This should form the basis of the system initially: farmers and growers should be able to join the system voluntarily. The technical criteria must be completely open and easy to monitor, and checks must be carried out independently, either by a government body or by an officially approved body.
The system must also be paid for by those involved, so that it does not impose any extra costs on the European budget. The only thing the Committee on Agriculture and Rural Development wants from the European budget is a little extra money for promoting these sorts of products. Why is this quality policy important? Firstly, because the market in Europe is becoming increasingly open to the world market, and it seems completely unreasonable to ask European farmers and growers to be more environmentally-friendly and animal-friendly in their production methods while at the same time opening up the market to products from farmers elsewhere in the world who are not subject to the same requirements. This is unfair competition, which is why we would urge the Commission to put these quality marks on the agenda in the WTO.

Fantuzzi
Mr President, I congratulate Mr Mulder on his excellent report, although we must ensure that it is used as basis for future work and that we do not simply stop here, satisfied with what the Commission has done. I personally am not satisfied with what the Commission has done, despite the claims of some DG VI officials that with the quality policy the whole CAP is no longer geared to the Ford approach, as it used to be. I think that is only true to a very small extent: we still have a common agricultural policy excessively geared towards quantity. If we do not begin to introduce quality concepts into the common organisation of the market, decoupling the aid from production tonnages, the actual scope for quality policies and producer responsibility will remain too small.
This is not to say that some positive signals have not come out of the Commission, for example the logo, this August, for PDO and PGI products. Then I see that there is a new site dedicated to quality products on the DG VI homepage on the Internet, and I know that promotional measures are also being studied. I have often had the opportunity to listen to the reports of the European Consumers Organisation in Parliament's Committee on Agriculture: they are unhappy about quality products, they have not grasped the fact that it is all about standards, seeing it as a protectionist measure to give producers an income and cheat the consumer. This means we still have a lot of ground to make up, a cultural battle to fight, and I think that here the rapporteur's proposals for a quality category based on environmental criteria are very interesting.
Of course, we talk about these things and then, in Agenda 2000, not enough attention is given to quality, taken in the environmental sense. The Regulation 2078 increments are too small and, above all, this idea of leaving it entirely to the Member States' discretion to link income support levels to environmental factors is unconvincing. Then there are the promotional measures, which are not developing fast enough. We now have 500 typical PDO and PGI products registered at European level, and I think there ought to be special ambassadors to promote the European way of producing and consuming worldwide, and to be the means of supporting new promotional measures at international level.
Finally, I agree with Mr Mulder that the Community needs to be very careful about protecting its quality policy in international forums. In the WTO they talk about meat with hormones and genetically modified foods as if they were televisions: I do not think that is acceptable.

Filippi
Mr President, the PPE Group supports Mr Mulder's report and we are grateful to him for the work he has done in the Committee on Agriculture. We have decided not to retable our amendments here, because the vote was carried in committee and we reject changes to the voting list because the improvements have already been made in the Committee on Agriculture.
I would just like to underline some very important aspects of the report. The first concerns the need to establish a comprehensive strategy for quality policy, through a specific set of rules operating throughout the chain and covering every aspect of quality. When we talk about quality we often only mean that a product must not be harmful to health. Quality is more complex than that, and we must try to cover the principle in all its aspects. The second point is about defending our typical products in the World Trade Organisation. The third important point, in my opinion, is the need to develop a new breed of professionals to protect and enhance quality, and to spend a much greater amount on promoting typical products and quality products. Too little is being done in this area. More needs to be done, but we must avoid creating more bureaucracy.

Anttila
Mr President, Commissioner, firstly my congratulations to Mr Mulder on an important and well-informed report. Consumers get confused by too many quality marks, trademarks and labels showing origin. I therefore give my enthusiastic support to the coordinated scheme referred to in Mr Mulder's report, whereby quality marks and approval systems are regulated at Union level. This will by no means be an obstacle to national, regional and local policy on quality, which is also very important. In Finland, we have just established a basis for a policy on the quality of domestic foodstuffs. It involves cooperation all along the food industry chain, quality control from the field to the consumer's table. This quality policy has to embrace an industry which at the moment, at least in Finland, competes solely through food prices and totally ignores the meaning of high quality. Quality means a higher price, because it costs more to produce it.
I support the proposal in Mr Mulder's report for an environmentally-based European quality category, because the European Union will never survive in global competition except through a policy of high quality and legitimate higher prices.

Rosado Fernandes
Mr President, I thought the quality of my speech was worth two minutes, but it seems I have already been cut to the European mark. Anyway, I want to say that we agreed with Mr Mulder's position, we continue to defend the view that one of the quality standards must be product flavour, and we maintain that, as well as standing up for flavour, we must also defend the ethical context in which the product is manufactured.
The Commission cannot solve this problem alone: it is a cultural problem and consumers need to be involved as well. The consumer associations must be alerted so that they themselves monitor the products they consume. It does not seem to me that this is an acute problem, given that life expectancy in the west has been increasing strongly and now even presents a political problem. So we are not taking poison on a daily basis, and I am not obsessed with the hysterical notion that what we are consuming is poisonous. But just as I do indeed defend quality, just as I believe quality should be respected and the 'MacDonaldisation' of the world should be prevented, so, at the same time, I insist that this process must not become too bureaucratic. I also think that product flavour must be defended at the World Trade Organisation and defended against all those people who are accustomed to eating any old thing. I defend European quality as the true quality of the things I like to eat, and that is what I call quality.

President
Thank you, Mr Rosado Fernandes, and I want you to know that the Chair had no intention of cutting your eloquence by 30 seconds. That is why - in spite of what the clock said - I did not use the gavel to stop you. I hoped you would speak for the full two minutes because it is always a great pleasure to listen to you.

Seppänen
Mr President, Commissioner, I bring greetings from the northern regions of the European Union. It is a paradox that we have adverse natural conditions, but we produce better quality food than they do in countries with favourable natural conditions. That is because we have family farms and not industrial production methods. It is an ecological method of production that we have. We have a winter, with cold conditions, which sees to it that there is less residual pesticide about than in the countries of the south. We oversee the ban on hormones and antibiotics differently from the way they do in countries with favourable natural conditions. Free trade within the EU has worsened the quality of our food and, for that reason, we give our support to labels, signs and codes that speak for quality, the environment, and which give information on content, all of which increase consumer protection and consumer choice.

Graefe zu Baringdorf
Mr President, Mr Fischler, you said earlier that we could not sell everything on the regional markets. But what we are discussing now is precisely the opposite of what we discussed before. Before, we were concerned not with selling quality goods on the world market but surpluses, which we can only get rid of by dumping them at low prices and for little money. I have nothing against putting quality goods on the world market when it is a matter of competition. Austrian wine, French wine, Parma ham: the same logic has to be applied on the world market as on the regional market.
What I want to say is that we must aim at quality and not at getting rid of surpluses from what is one of the largest food import areas in the world. We do not have any surpluses. But surpluses do exist in all areas where intervention attracts them. That is why this report is so important. We must aim at production geared to quality, and then let us certainly produce for the world market, but I beg you, not with state aids but by finding customers and areas on the world markets that actually want to buy these products.
One last thought. Mr Fischler, of course we also depend on the rest of the market in regard to our quality products. If the pig market collapses now, it will of course become far more difficult to keep the regional quality market at a certain price level than if the price is generally stable. That is why the two aspects are not entirely separate and it is in our interests to promote the overall quality of the market.

Barthet-Mayer (ARE).
Mr President, our quality policy for agricultural products and foodstuffs, although new, is incomplete. It is based on three regulations that have dealt with organic vegetable produce since 1991 - and this regulation is currently being extended to include animal products -, and protected geographical indications and certificates of specific character since 1992.
The report by Mr Mulder, whom I congratulate on this reliable work, puts forward two interesting lines of thought for extending this policy. Firstly, it proposes the adoption of a regulation improving the transparency and authenticity of quality marks. It states that checks must be performed by bodies accredited by the Member States and truly independent of producers and traders. It then proposes the creation of a European quality mark based on respect for the environmental criteria for production.
Mr Mulder, I think it should be pointed out that quality is a global concept that cannot be reduced to just a single element, be it hygiene, aesthetic quality, taste or absence of residues. For agricultural products, quality is linked to variety, production methods, the environment and methods of conservation. For processed products, it is linked to the initial quality and processing methods.
To complement this concept, my group proposes introducing the concepts of nutritional value and optimum health in Amendment No 8. As regards monitoring, experience in the area of organic farming shows that checks must be rigorous so as to avoid distorting competition at the level of imports from third countries, but also between the Member States. This is the basis of Amendment No 8, which recommends that checks should be the same for imported products and harmonised for Community products.
To conclude, I should like to say that between the two extremes of organic farming and factory farming, there is in fact room for an intermediate, but heterogeneous approach, which must be regulated in the interest of the consumer and of the producers who practise integrated agriculture. A comprehensive regulation should define its procedures for production as well as its procedures for granting a European quality mark, which should be authenticated by a single logo likely to give rise to and merit consumer confidence.

Souchet
Mr President, everybody is talking about the concept of quality, but in actual fact it covers very diverse dimensions. Some people talk about the health quality of a product, and in this respect the BSE crisis shows us that the consumer is increasingly sensitive to this issue. Others talk about the organoleptic quality of a product and others, finally, talk about the quality linked to the tradition of local products.
Our rapporteur, whom I should like to thank very sincerely for his report, has successfully analysed the first two dimensions, to which the consumers in the northern Member States of the Union are particularly sensitive. The Group of Independents for a Europe of Nations has, for its part, tabled three amendments to our colleague's report, which aim to strengthen the third dimension of the concept of quality.
In fact, due to the globalisation of trade, the market in agricultural raw materials is becoming increasingly dominated by the concept of price. I think, Mr President, that the 'tradition' concept of quality represents a considerable opportunity for the rural areas of Europe. The market in agricultural products is therefore no longer linked exclusively to price, but to the region.
In France, we have a long tradition of products with a registered designation of origin. The 'Institut national des appellations d'origine ' has enabled high-quality wine-growing to develop and the quality of certain cheeses and meat products to be established and protected. We see that where agricultural production is linked to a product with a registered designation of origin, the enhanced value of agriculture in the area of production is protected.
Maintaining this enhanced value in the designated areas both protects agricultural jobs and prevents a shift towards production methods that are harmful to the environment, by protecting the biological diversity.
Some cheeses of designated origin require the use of milk from specific dairy breeds, and in winegrowing, only traditional vine varieties may be used. These examples just go to show that this dimension of high-quality products, local products and traditional products represents an opportunity for certain production areas in the rural areas of Europe.
As mentioned in the report, it is time that we had a real policy on the quality of agricultural products and foodstuffs in the European Union. This policy must cover all aspects of the concept of quality. These three dimensions must be combined to enable us to respond both to the consumer's demands and those of the processing industry, but also to the need for a greater balance in rural society.
Employment, Mr President, will only develop in rural areas if agriculture shows that it is capable of adapting its production to the demands of consumers and the various operators involved in the sector, and capable of protecting, as far as possible, the added value close to the place of production.

Happart
Mr President, Commissioner, cultural identity is, to a great extent, not only expressed in the way we feed ourselves, but also, and more particularly, in what we eat and drink. Products of designated origin must be based on very precise qualitative criteria, whether they relate to the product's origin or the way in which it is produced. In this way, we will guarantee the survival of cultural characteristics, but we will also maintain a significant economic potential in the rural areas that do not have other products or other alternatives. For two years, since the conference in Cork, we have been stressing the need to protect jobs in rural areas and looking for consistent ways to achieve this. Products of designated origin with specific qualities are a concrete response to this problem.
We talked about the pigmeat crisis this morning. It could certainly have been predicted. It is cyclical. What is the alternative? For example, to produce Ardennes ham, the pig must be raised and fattened up in the Ardennes, with cereals produced in that same region, and the meat must be processed in accordance with precise specifications for each stage of production, from the farm to the consumer's plate. Of course, that does not mean that we can do whatever we like with mass-produced products with no designated origin. The safety and the quality of foodstuffs must not suffer due to laxity. Human health is above all protected by the way in which we feed ourselves and, in particular, by the quality of the products made available to the consumer.
I am not going to point out to you the reprehensible laxity of the relevant British authorities in the criminal problem of mad cow disease. I hope that all those responsible in Europe have understood that the concern for the profitability of a minority must never prevail over the health requirements for the majority. Under no circumstances, and on no account, must specific characteristics of high-quality products that enhance the value of regional traditions be renounced in order to mass-produce these products, which become commonplace and are shaped by the constraints of the global market. Making products commonplace will never create as many jobs and will not give as much satisfaction to the consumer as maintaining regional characteristics.

Keppelhoff-Wiechert
Mr President, Commissioner, Mr Mulder has drafted a very good report on quality policy for agricultural products and agri-foodstuffs. The consumer still finds it very difficult to identify many of the regional quality marks in the single market, which is why we should really all welcome the proposed supplementary European rules. The European consumer is attaching increasing importance to the protection of the environment and animal life. As representative of a large women's association, I still seriously question whether double labelling - i.e. a regional and a European quality mark - really will persuade people to pay higher prices for foods produced under more stringent rules.
In my experience, the public is prepared to pay higher prices for clothes, housing, cars and travel than for actual food. But the double label does not necessarily have to raise prices. As many previous speakers have said, we need a European code of good agricultural practice in integrated farming to put before the Americans at the WTO negotiations as a European agricultural model.
But we still have to explain to our citizens that if we want better environmental protection, better animal protection, then logically we must also be prepared to pay a reasonable price for goods produced under these more stringent conditions. By establishing a European quality mark we now want to help consumers in the single market to recognise other Member States' national and regional quality marks too, since they say something about the special quality of this food.
In that way, a Spanish housewife looking at German products with a quality mark she does not recognise can be quite sure that this food complies with strict and transparent requirements. Recognised European quality marks should satisfy very specific basic requirements, and I think that thanks to Mr Mulder's report we will be able to open up an even larger market for these products.
At present we have two European quality categories for agricultural produce: organic farming and the Community protection of traditional specialities. We in Parliament would like to add a third category covering organic products that also comply with environmental and animal protection criteria. That would satisfy the consumers' demand for environment-friendly products and give added importance to integrated production, something that has been widely discussed but in my view not yet clearly defined.

Hardstaff
Mr President, I too believe that size, shape and appearance of food are not the only criteria by which quality should be judged. I do not very often agree with Mr Rosado Fernandes in this House but I agree with him wholeheartedly that taste, flavour and nutritional value are the real benchmarks of food quality.
I was recently in Poland for the Joint Parliamentary Committee. At the end of three very intensive days' work I felt amazingly well and healthy. When I thought about it, I put it down to the excellent quality of food I had enjoyed during those three days: fresh fruit, vegetables, fresh fish and meat and the most delicious bread I have ever tasted. And yet we in the EU tend to regard Poland as having inefficient agriculture.
We have to look at our methods of agriculture within the Europe of the 15 and the way in which we define quality. Intensively produced, bland-tasting produce that looks nice is not real quality as even the big supermarkets are beginning to acknowledge. Naturally-produced foods untainted by excessive use of pesticides etc., food with real favour and nutritional value are increasingly what European consumers are quite rightly demanding. Europe's farmers, food manufacturers and supermarkets should be adapting to meet that demand.

Schierhuber
Mr President, Commissioner, ladies and gentlemen, congratulations to Mr Mulder on his report. Quality policy is vital to European agriculture, although we note that the definition of quality still keeps provoking differences of opinion. Quality production must also be reflected in the price and in farmers' incomes. Let me point out that in Austria during the BSE crisis the sales of products with recognised quality marks and designations of origin did not fall.
Although we cannot yet have a uniform European quality mark, our aim should be, as stated in paragraph 8 of our resolution, to pursue this road steadily. The vast majority of European farmers do not live in advantaged areas. That is why they cannot significantly increase their incomes by increasing their production. So quality production must be the number one criterion for European agriculture and its distinctive character; it is essential to obtain guarantees to that effect at the next round of WTO negotiations.

Fischler
Mr President, ladies and gentlemen, I too have read Mr Mulder's report on a quality policy for agricultural products and agri-foodstuffs with great interest. From my point of view, I can only welcome the ideas put forward as a matter of principle. I am sure the Commission should also look at all the points made in your motion for a resolution with great interest and attention, but I would prefer to concentrate here on the two main headings of your report.
First, on introducing a European quality mark to coordinate the existing quality marks, I would draw your attention to one particular point. In principle, in all new legislation we must first consider whether the questions concerned can or cannot be regulated effectively within the existing legislative framework. Here I would remind you of the Commission's basic concept of legislation, as set out in 1985 in the White Paper on the completion of the single market. Since the adoption of that concept, harmonised common rules have been proposed in regard only to health and consumer protection, environmental protection and sound commercial practice. Any questions that do not fall within the scope of these harmonised rules must be regulated by mutual recognition of national rules, laws or technical requirements.
The obligation to notify the Commission of norms and technical specifications makes it possible to evaluate whether the objective has been achieved, i.e. the removal of technical obstacles to trade in the Union. If the content of the quality marks differs widely from one Member State to another, that could represent a quite substantial obstacle to trade within the EU. This has become clear from the activities of the Commission services and various Court of Justice judgments.
In the early 1990s, the European legislative authority therefore laid down a legal framework for protected designations of origin, protected geographical indications, specialities guaranteed as traditional and organically farmed products. This was justified because common measures have proved more effective than individual national measures - if you like because of the European value added.
Proposals on quality indications or certificates of special qualities of products with the exception of traditional specialities were, however, rejected. At this time the Commission cannot see that anything has changed significantly with regard to the basis for that decision. The unsatisfactory experience we gained with the European eco-label is further evidence, which is not to say that we will not continue to monitor developments closely.
Let me now turn briefly to the second main proposal, for a new European quality category based on environmental criteria. As you know, in the case of integrated production we already have a number of Community measures, studies and research programmes, special support under the common organisation of the market, such as that for fruit and vegetables, and the financing of agricultural environmental measures under Regulation 2078. All these aspects are in fact to be given further support under Agenda 2000.
So we should continue thinking at that level and, for example, work out guidelines that take account of the variety of our products, the different farming methods, local conditions and the use of technology. I am firmly convinced that the further development of integrated agriculture really will benefit the environment and contribute to sustainable land use. But that is precisely why we first need a clear strategy. If a comprehensive strategy shows that it would be useful to introduce a European quality mark and we can take joint measures to make it sufficiently consistent, then it might well be appropriate to do so. At this stage, it still seems a little too soon to take a final position on this question.

President
Thank you, Commissioner.
The debate is closed.
We shall now proceed to the vote.
(Parliament adopted the resolution)

President
Congratulations to Mr Mulder on the adoption of his important report.

Graefe zu Baringdorf
Mr President, I have one more question for Mr Fischler before he leaves. By adopting paragraph 5, we have now voted that animal products should be included in Regulation 2092/91 on organic production methods and that this should now go ahead. You know that a joint Commission and Parliament proposal on this subject has long been on the table, yet the Council has still not put it on the agenda. This gives me another opportunity to call on you and Parliament to exert pressure to at least put it on the agenda of the Austrian Presidency, because I know that organic farming plays a very important role in your country, on which I would like to congratulate you.

Fischler
Mr President, Mr Graefe zu Baringdorf, ladies and gentlemen, I am quite prepared to put Parliament's request to the current presidency. But I can also tell you that the presidency has already said that it intends to consider this question during its current term of office.

Gillis
Most of the land area of my constituency and many of the people I represent here in Parliament are engaged in the production, processing and marketing of food. Food for domestic consumption and also for export. All my constituents are food consumers. So food safety, quality and hygiene are matters of the utmost importance to us all. It is very clear that the BSE crisis and findings of the Committee of Inquiry have focused the attention of both producers and consumers. Producers realise as never before that respect for consumers' interests and meeting their needs is an absolute prerequisite for success in the marketing of food. Consumers for their part, rightly demand transparency and openness - good production methods, high standards in animal husbandry and animal welfare. They also demand more environmentally friendly farming systems which will ensure a sustainable agriculture.
I am fully supportive of the principle of quality marks. I have, as a producer, participated for many years in the development of such a national quality market. However, I have some doubt whether an overall EU development mark could be superimposed on existing quality marks without damage to one or the other. Manufacturers and retailers are using quality markets to reassure their customers - not alone to give them information on production methods and origins, but also as a very important sales and promotion tool.
The concept of an overall EU quality mark would require a tightly controlled monitoring system to ensure that very high standards are maintained across the EU. It is also important that existing quality markets be identified separately and continue to show a benefit for their huge development costs.
An overall EU quality mark could also be used in the context of WTO to force compliance with EU health standards for imported food products.

Sindal
The Danish Social Democrats voted for the Mulder report on agricultural products and agri-foodstuffs today. We did so taking the view that the report is acceptable overall. We support the introduction of a European quality mark, which takes account of animal welfare and the environment. However, we think it important to specify what is meant by animal welfare and the environment. Concrete rules must be laid down, and those countries which do not observe the rules should forfeit the right to use the mark. Many Member States still view quality as something linked to taste. We also think that quality is animal welfare and concern for the environment. It is important to establish transparency for consumers where such a mark is concerned.

van Dam
Various Member States have developed quality marks for integrated farming products. To provide the consumer with greater transparency, Mr Mulder is calling for a study to be carried out into whether such marks could be brought under one European quality mark. We in the Dutch sub-group support this idea and we voted for the Mulder report. However, there are a few comments we should like to make.
A European logo should not be used to replace existing national, regional and local quality marks, but at most to supplement them. Every region has its own rural and cultural values and environmental problems, which is why regulations on integrated farming and its quality marks can only partly be harmonised at European level. A further factor here is that quality marks stand or fall by the confidence that consumers have in them, and existing marks have now developed a reliable image. It remains to be seen whether consumers will have the same confidence in a European mark.
On the other hand, we can only agree with the idea of a European quality mark if it really does mean something. The products concerned must have a clear added value compared with other accepted products, not just in terms of intrinsic quality, but also from an ecological point of view. Otherwise the European quality mark will be nothing more than a cheap marketing ploy.
In short, we support a study into the viability of a European quality mark, but we will reserve final judgement until we see it in practice. There are two important points here. Enough scope must still be left for national and regional marks, and the products concerned must have a clear advantage over other accepted products in terms of environmental protection.

Objective 2: job-creation
President
The next item is the report (A4-0213/98) by Mr Vallvé, on behalf of the Committee on Regional Policy, on the Commission communication to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions entitled 'New regional programmes 1997-1999 under Objective 2 of the Community structural policies - priority to job-creation' (COM(97)0524 - C4-0641/97).

Vallvé
Mr President, Commissioner, we are about to debate this particular aspect of the Objective 2 programme for the years 1997-1999.
I do wonder whether there is much point in debating this communication, which was presented by the Commission nearly a year ago - on 14 November 1997, to be precise. It contains an analysis of the period 1997-1999, but the document reached us when almost a third of the relevant period had already elapsed.
We are also debating this document at a time when the Committee on Regional Policy has already drafted its five reports on Agenda 2000 which are to be discussed in committee next week.
But I think it is positive that we are taking advantage of this debate to talk about regional policy, as that does not often happen in Parliament, and we should not forget that the European Union devotes 34 % of its budget to regional policy.
I particularly want to thank the Commissioner for being here for this report. I am not surprised, because her dedication to the work of the Committee on Regional Policy has been constant.
I am not going to use this report on the years 1997-1999 as an opportunity to talk about what could and should be the regional policy of the European Union in the future, in other words, to analyse Agenda 2000. I am not going to do that. That will be the subject of future debates in this House, possibly in the November part-session.
I want to highlight the changes that were made to Objective 2 for the years 1997-1999, which primarily affect abstract elements, the development of firms - especially SMEs - innovation and product development, training and professional qualifications, and also the measures which need to be adopted for the protection of the environment.
Commissioner, I believe these changes mark a departure from the use of the Structural Funds - and specifically Objective 2 funds - for infrastructure development, operating as a substitute for Objective 1, in a sense.
Objective 2 relates to the conversion of industrial areas, and the word 'conversion' is maintained in Agenda 2000. This is conversion with a wider scope: the reference to industrial areas will also include rural areas, urban areas and fisheries areas.
Conversion is a fundamental instrument for the promotion and improvement of economic and social cohesion in the European Union. Clearly the top priority for 1997-1999 is job creation. It is a fundamental goal in a Europe where - we should never forget - there are 18 million people who cannot find a job.
It is regrettable that there was no coordinated assessment of the measures certain Member States were already taking with social groups likely to be at risk of long-term unemployment in the future.
There are four priority factors: competitiveness, development of research, training and equal opportunities, and environment protection. These are very important in relation to conversion and the development of competitive regional economic structures.
However, I very much regret that the increase in expenditure has applied basically to research and development, with virtually no increase for the other elements.
The 1997-1999 programmes obviously maintain continuity with those of 1994-1996. I must also stress that the new Objective 2 guidelines for the year 1997 - this is one of the advantages of analysing reports retrospectively - have led to full take-up of the available resources. The principle of additionality and proving its application when programmes are being approved continues to present problems at times. The conditions need to be defined more clearly.
The cooperation principle needs to be strengthened as well, and the role of the regional authorities and social partners is fundamental here. I understand the Commissioner has already made plans for the future in this respect.
It is also important to stress that due account must be taken of the nearness of Objective 2 areas to Objective 1 areas.
Finally, I am grateful for the amendments that have been tabled, although I do not want to incorporate those which refer to the Agenda 2000 project.

González Álvarez
Mr President, Commissioner, the Committee on Employment and Social Affairs has drafted a joint opinion on the Vallvé report and the Howitt report, which was discussed last week and refers to the adjustment of the Structural Fund programmes up to the end of 1999 and the new Objective 2 regional programmes for 1997-1999. What these reports have in common is a proposal for a medium-term review of the European Union's structural interventions and, as Mr Vallvé said, we are already halfway through that period.
We share Mr Vallvé's concern because jobs are actually the main priority in this proposal. We believe it is necessary to harness the potential of the four sectors he mentioned: SMEs (over 80 % of jobs in the European Union are in small and medium-sized firms); the environment (sitting on the Committee on the Environment, I am very well aware of the new sources of employment in very important sectors drawing on the potential of the environment, and it is very important to take that into account); research and development; and, of course, equal opportunities - once and for all, women must have the same opportunities as men.
We endorse the criticisms about the failure to evaluate the previous period, because that would have improved the conditions for making proposals for the future. We saw how difficult it was for the environmental authorities and the social partners to participate in each of the previous programming periods, and there has been no real evaluation of the role the new sources of employment have played in spending the Structural Funds to create jobs, especially in regions in industrial decline like my region - I am Asturian. So we think it is very important that we should take account, in the ongoing reforms which we will continue to debate next week, of the need for across-the-board implementation of the principles of transparency, participation, equal opportunities and sustainable development - only 5.2 % is devoted to sustainable development - and for a balance between policies to preserve and create jobs and economic policies which do not destroy jobs, because sometimes economic policies do harm employment. We also think the budget for infrastructure should be reduced, because the employment it creates is short term, and there should be more money for new sources of employment, because they create longer term jobs.

Howitt
Mr President, on behalf of the Socialist Group I wish to express our very strong support for this current programme of measures to combat unemployment in Europe's areas of industrial decline. Support, because job creation and an end to the scourge of unemployment must be the first priority of our Structural Fund programmes; support, because people living in our coal-mining, textile, steel and defence regions did not ask for the economic shock waves that have taken the heart out of their communities and no one can ask them to rebuild their economies without public support; and support, because this ECU 9bn of expenditure - more than £7m - represents the people's priorities on how European money should be spent.
In congratulating Mr Vallvé on his report, I note there are many areas of agreement with my own parallel report on guidelines for Objective 1 and 5b areas over the same period. We agree on the need to ensure stricter adherence to equal opportunities and environmental objectives in all of the programmes. Five per cent for the environment: that means that 95 % of the money could be harming our natural resources, and that is not good enough.
We agree on the need to support the guidelines process to ensure common themes underlie the programmes in each of our countries, and the need for a full consultation on those guidelines by the European Commission. I hope the Commissioner will take the opportunity this morning to guarantee to us that the new sets of guidelines will be ready by 31 December.
We agree that the delayed agreement of the programmes in the first period - 12 % of the money being carried over - causes unacceptable damage in the regions and localities which wait too long and then are forced to spend too quickly.
On behalf of my own country, we appreciate that the United Kingdom is the biggest beneficiary of this programme: some ECU 2.7bn - over £2bn. More than 150 000 small and medium-sized companies in Britain are being helped today thanks to that money. With some 14 % of all public investment in metropolitan France represented in this programme, it demonstrates, beyond doubt, the value of the safety net, which we argued for in the next programming period, to avoid a sudden disappearance of this very significant level of support. I thank the Commission for accepting what we had to say.
The Socialists will support the vast majority of amendments before the House today. In particular, we support the conclusions of our colleagues from the Committee on Employment and Social Affairs that more money must be allocated to new sources of employment, including the cooperative sector, environmental projects and local development initiatives. We agree with them that the complete lack of evaluation of the number of disabled beneficiaries is a marked failure to achieve the mainstreaming, which the Commission so often talks about.
Let me explain where we must disagree. Firstly, we cannot support specific amendments which single out maritime fisheries or urban areas for special priority, whatever our personal sympathies, because this represents a balanced package in which no one special interest can be advocated above any other. Secondly, we cannot support proposals for the split in funding or criteria in relation to the new Structural Fund regulation. That debate is being held in committee, and it would be premature to resolve those issues today. Thirdly, we will not single out the Commission for specific criticism over underspending or for its failure to address the horizontal objectives sufficiently.
We share the concerns, but we prefer to work together with the Commissioner to constructively tackle the causes of these problems in the future.
Finally, in our resolution of 14 February 1996 we stated our demands for this programme to the Commissioner. I am delighted that those were largely agreed. 14 February is Valentine's Day - a day for sharing messages between lovers. With the greatest respect to Mrs Wulf-Mathies, even if we cannot guarantee such a close relationship today between Parliament and the Commission, we thank her and congratulate her on the very important work being achieved in this programme.

Berend
Mr President, Commissioner, ladies and gentlemen, like Mr Vallvé, the rapporteur, I welcome in principle the definition of guidelines to establish the Commission's priorities. They are designed to ensure a balance between economic policy, creating and preserving jobs and the other specific Union policies. These have already been mentioned: competitiveness, support of SMEs, environment and sustainable development, together with innovation and equal opportunities.
The Objective 2 measures remain extremely important to creating and preserving jobs. I welcome the emerging evidence of the broader continuity of the various new programmes with the previous programming period. But one point of criticism I must make is that the quality of the programmes still does not always meet expectations, and the findings of the mid-term reviews are not turned to account early enough for planning future assistance.
The principle of additionality and its evaluation still cause problems because the necessary documents are not always forwarded. We welcome the introduction of conditional clauses for the second payment. However, the new provisions on assessments need to be made much simpler.
We support the Commission's intention to give the Member States more room for manoeuvre in future by combining national and Community criteria. We do not really think the rapporteur is justified in his fear that the Member States might abuse this room for manoeuvre. In my view, the Commission's subsidiarity-based approach is a step in the right direction.

Lindqvist
Mr President, Commissioner, the four areas, small and medium-sized enterprises, the environment and sustainable development, equal opportunities for women and men and promotion of research and development, are good priorities for the creation of new jobs.
I wish to draw special attention to the environment, with new environmental products and new environmental systems, as an area for development. Good technical solutions and environmental technology will be needed throughout the world in the future. We must of course exploit that and make sure that we are well ahead in this area.
There is a downside, however. Appropriations must be used more effectively. There must not be empty chairs and money for projects remaining unused for several months or for half a year. Evaluation must be improved through correct environmental impact assessments and equality assessments in all programmes, so that the main rules that have been laid down on equal opportunities, the environment and sustainable development are actually adhered to.
I especially welcome the inclusion of coastal, island and archipelago regions in the new Objective 2 areas, i.e. the old Objective 5b areas. I for my part will support Amendment No 4, which covers increased national influence.

Donnay
Mr President, the European Union has almost 20 million unemployed, and this is an extremely worrying situation. That being the case, the issue of employment represents a major challenge. The results of the fourth phase of the Objective 2 programme, whose priority is job creation, are relatively pleasing. But there is still a great deal to be done.
We can make a certain number of conclusions from the report. However, let us go beyond this partial assessment and examine the Commission proposals under the future Objective 2. There is a risk, in our opinion, that the performance reserve might damage the effects of extending the programmes to ensure their necessary continuation. We are also sceptical as regards the fixing of indicative percentage figures relating to the allocation of the volume of the programmes' interventions between the different priorities, and as regards the extreme diversity of this objective, which might damage its coherence and effectiveness.
Finally, it is absolutely necessary to continue to grant a substantial amount of aid to regions in industrial decline in order to allow them to continue to develop, as the majority of them have already started to do. This development could be strongly compromised by a reduction in aid.
In conclusion, we must be able to put the lessons drawn from the current Objective 2 to good effect in order to obtain the best possible results from the interventions of the future new objective for employment.

President
Thank you, Mr Donnay.
Ladies and gentlemen, I will now ask Mr Manuel Escolá Hernando to speak on behalf of the Group of the European Radical Alliance. Mr Escolá Hernando is speaking for the first time in this House. I would like to welcome him, and I speak from my personal knowledge of him and his career when I say that I believe he will make a very positive contribution to our work together in Parliament and to the progress of the European Union.

Escolá Hernando
Mr President, as you said, this is my first speech before Parliament, and on behalf of the Group of the European Radical Alliance I would like to express our support for this report. We would especially like to underline the point made in paragraph 18 of the report, which we entirely agree with, about the Commission's proposals for the new Objective 2. The point is concerned about the very significant increase in Member States' discretionary power which might be introduced if the proposal goes ahead to have a combination of Community and national criteria for selecting regions theoretically eligible to receive aid under the new Objective 2.
Ladies and gentlemen, some might interpret this formula as an abdication of responsibility by the Commission to the internal political interests of each Member State. It might even suggest a certain renationalisation of the structural policies, and that could not only distort the results the Commission is looking for with the creation of the new Objective 2, but could even undermine its fundamental aim, which is to support declining regions with structural difficulties. It could mean that areas suitable for Objective 2 selection are excluded, while others which are not so suitable are included to serve the internal political interests of Member States.
In view of this, we think it is vital for the future of Objective 2 for the Commission to make the selection criteria more objective.

Porto
Mr President, the Objective 2 Structural Funds deserve very special consideration. They are extremely important, but very difficult to apply correctly.
As industrial areas in decline are involved, extreme care must be taken to ensure that the industries concerned have prospects and, more specifically, to ensure that each individual company is viable. If so, they must be given the direct support they need, correctly applying the 'ageing industries' argument.
If this is not the case, or if the industries or companies are not competitive in the medium or long term, it is in the interests of all, and of course in the interests of the workers, to find valid alternatives in a competitive world where a return to closed borders is neither likely nor desirable.
As Objective 2 now also covers urban renewal, this needs to be kept very much in mind, although it is not something which can be attained unless there are clear and balanced national promotion policies. If, as happens in my own country, we persist with policies of polarisation or, at best, bi-polarisation, concentrating all our efforts to improve quality and introduce dynamism on only one or two towns, there will still be population movements and there will still be sensitive social problems of exclusion and insecurity. It will be like trying to hold back the waves, and all the national and European Union funding directed at it will be inadequate.
Comparative experience in Europe is very clear: countries with a balanced urban network do not have problems like this; they are able to keep people in their region of origin, thus achieving a better use of resources.
We cannot simply go on forever dealing with the social problems suffered by people who are not to blame for misguided policies. We must keep making progress towards fundamental solutions which will benefit all of us.

Klass
Mr President, Commissioner, ladies and gentlemen, structural policy always implies labour market policy too. There is a cycle to life in the regions. People simply tend to live where the jobs are. But they prefer to work in regions that offer not just jobs but also an intact environment, which means a well-kept and healthy natural environment, a good infrastructure and rapid transport connections between work and home. The ideal job also requires a good cultural environment. There must be schools and educational and further training facilities, together with a range of cultural activities to be pursued in leisure time. If one of these cogs in the life cycle disappears, imbalances will appear and whole regions bleed to death. People do not live in places where there is no work and, conversely, there is no work in places where no people live. This is the situation that structural policy must address; we must look at all the surrounding factors and not just at jobs in isolation.
When we look at roadworks, we tend to see large machinery with very few workers actually in evidence, but that road may be a lifeline for the region. The evaluation of the individual programmes has shown that where EU funding goes, additional cofinancing also goes, but in particular private sector money. For every million ECU of EU cofinancing, the Member States contribute another two million and 20 % of total resources come from the private sector. So this creates quite a strong centrifugal force. We must take a long-term approach, and I agree with the rapporteur, Mr Vallvé, that three years is too short a period. We must take a broad view of the whole question, so that the people of Europe can lead a life worth living.

Hatzidakis
Mr President, Commissioner, while there is almost a year before the period of the programme we are referring to lapses, in essence we cannot do anything other than to draw conclusions and lessons for the new programme period.
It is therefore important - and this is my first comment - that according to the Commission's estimates, for the period we are talking about 880 000 jobs are being created in the Objective 2 areas. The number could have been even larger, but clearly it could also have been smaller. And consequently I express myself well content with the fact that we have concentrated on four priorities, namely competitiveness, environmental protection, equality of the sexes and innovation, which I regard as very important. At the same time, however, there are problems, which other speakers have mentioned, relating to the quality of the programmes and to the forecasting of job creation, and it would be desirable to deal with them.
Now, as for the new programme period, we as the European People's Party, I must tell you - although you know it already - have many doubts about the Commission's effort to deal with the new Objective 2 and at the same time with the difficulties of industrial and rural areas which are facing problems of conversion. Beyond that, however, we think it necessary, if nothing else, for there to be some guarantee that we will have a coverage of 10 % - I mean in population terms - at European level for industrial areas and 5 % for rural areas within the regulation.
We are also in favour of the Commission's proposal to have both national and at the same time Community criteria for the selection of those areas. This is made necessary by the principle of subsidiarity. And we also favour the Commission's proposal for a safety net, in other words a maximum reduction of the order of 33 % for regions covered at present by Objectives 2 and 5B.

Wulf-Mathies
Mr President, ladies and gentlemen, first I wish to extend my sincere thanks to Mr Vallvé, and indeed to everyone who took part in the debate, for this constructive discussion and extremely constructive report. I welcome the broad agreement between the Commission and Parliament both on the guidelines and on the assistance priorities for the Objective 2 programming period 1997-1999. Our primary aim must indeed be to help regions undergoing structural change to create long-term employment.
I am particularly pleased that you support the Commission's reform proposals on concentration, decentralisation and simplification, and that the rapporteur recognises that for the second Objective 2 assistance period the Commission has now endeavoured to draw directly on the lessons learnt from the past. I also agree with him that, as noted in the motion for a resolution, concentration should be achieved through solidarity. The positive attitude to the Objective 2 guidelines to support the Member States' development plans reinforces the Commission's argument in favour of reforming the Structural Funds. I am happy to state once again that we intend, first and foremost, to complete the guidelines for the new programming period by the end of the year. As you know from our procedure in relation to the Objective 2 guidelines, we always maintain a close dialogue with the Committee on Regional Policy and with Parliament during that process, which of course is why we agree on the aims.
You must know that we openly welcome your call for targets to be quantified more clearly in future. We have already supplied the Member States with a methodological framework for forecasting the impact on employment for the period 1997-1999. But we note that, regrettably, little use has been made of it. That is precisely why we must improve the indicators and evaluation in future. In response to the comment made by one Member, let me therefore make it clear once again that the performance reserve can act as a good incentive here, for there is no shortage of indicators, nor is there really any lack of encouragement by the Commission to use them; but there are not enough resources for using instruments of this kind to create that positive incentive.
The Commission agrees that we must also seek to improve the support for the special priorities of the guidelines - competitiveness, SMEs, innovation, environment and equal opportunities. However, we believe that our proposals in the new structural fund regulations, namely to offer financial incentives for key Community policies such as the environment or women, are more effective than quotas, given also that we must make sure that we do not disturb the bottom-up approach we are taking in regional policy by introducing such quotas.
On the question of the coherence of the new Objective 2, let me briefly describe our approach, since some Members were clearly worried about a lack of coherence here. Once again, we are concerned with the same question in all the areas - industrial areas, rural areas, fisheries areas, urban areas in difficulties - namely aid to cope with structural change and create jobs in sectors other than those in crisis, where we are faced with job losses.
The up to 50 % coverage by national criteria and the greater flexibility in the selection of regions contained in the draft regulation give the Member States the necessary room for manoeuvre to take account of special national and regional features and to use supplementary criteria, as many Members called for during the debate. The Commission does not share Mr Berend's concern that the proposed combination of Community criteria and national criteria would in fact leave the Member States too much room for manoeuvre and could lead to abuse. Let me emphasise, however, that the Commission will do its utmost to prevent national sectoralisation and fragmentation from putting the regional bottom-up approach at risk. I believe it is important to be able to count on Parliament's support in this matter, and here we can perhaps allay the fears expressed very openly by Mr Vallvé and another speaker. I think it is important to overcome the competition between sectoral policies - and also the competition between town and country - by integrating the eligible areas, and to make use of the synergies that are so often going to waste at present.
We agree on the importance of partnership. Here let me specifically point out again that we wish to come closer to the people in future through the involvement of local and regional authorities and the social partners, the participation of NGOs - thus including environmental associations - and the involvement of more women in the monitoring committees. This will also help mobilise wider support for our common aims. So from our point of view, the new partnership principle plays a key role both in improving efficiency and in making Community assistance more visible.
On the question of simplification, we would broadly agree. But let me address one misunderstanding here. In future, the monitoring committee will be the decision-making body, even in the event of minor programme alterations. There too we have reduced the Commission's influence so as to remove one bureaucratic source of irritation.
Let me conclude with a word on additionality. Indeed, both the Commission's communication and Mr Vallvé's report show the problems we encountered in introducing additionality. That is why we are aiming to simplify and introduce better controls through this reform. If additionality becomes part of the negotiating process for future programmes, we will find it easier than in the past to ensure that the Member States and the Commission agree on a common definition of what additionality is to mean and ensure that it is verifiable.

President
Thank you, Mrs Wulf-Mathies.
The debate is closed.
Before we proceed to the vote, Mr Kellett-Bowman has a point of order.

Kellett-Bowman
Mr President, on a point of order, I notice that the Europe des Nations Group has asked for six roll-call votes in this vote with all the implications of time and resources. They have just left one Member behind to make sure we do.

President
Mr Kellett-Bowman, the request for a roll-call vote was properly made. The Chair can only apply the Rules. I do not have the power to do anything else, but your comments will be noted in the Minutes.

Berthu
Mr President, I should merely like to answer Mr Kellett-Bowman in one sentence. When we see the debate and the votes, we are happy that we requested roll-call votes. One of the amendments has been accepted, others have been rejected by just a few votes, and we think that we were right to put forward this request.

President
Thank you very much, Mr Berthu. The Chair has already stated that the proposal was made in accordance with the Rules, so there are no grounds for changing anything.
We shall now proceed to the vote.
(Parliament adopted the resolution)

Andersson
I voted in favour of Amendment No 4, because I wish to see greater flexibility, especially in the matter of state aid.

Souchet
Mr Vallvé's report is presented as a diptych. Its first section attempts to evaluate Objective 2 in the 60 eligible regions for the 1989-1993 period. The rapporteur is fair in noting that we are totally in the dark here: the data is 'rarely available' and the performance indicators 'are not standardised'. Simple rigour should therefore have led the rapporteur to distance himself from the fanciful overall assessments that the Commission has produced with regard to the number of jobs created or preserved due to the existence of the Objective 2 programmes. Mr Vallvé does indeed recognise that 'these figures are to be taken with caution due to missing or incomparable data, their estimative character and the missing link to targets... Targeting was still exceptional in these programmes, an assessment of the degree to which the programmes were successful', the rapporteur adds, 'thus proved difficult'.
However, he finally accepts an overall figure - obviously carefully worked out for propaganda purposes since the statistics have no relevant meaning -, of 450 000 to 500 000 net jobs attributable to the Objective 2 programmes. The reality is that no-one is in a position to assess the real impact of these Structural Funds, which are very significant in terms of employment. We had tabled an amendment taking up exactly the same reservations as the rapporteur himself expressed in his explanatory statement, which strangely were not then followed up on by their author.
The second section of Mr Vallvé's report relates to the future prospects of the new Objective 2. The rapporteur examines the heterogeneous nature of the new objective and seems to make a euphemism when he questions 'the Commission's optimism on being able to assure coherence in such a diverse objective'. He also fears that the population ceiling established by the Commission will lead to inappropriate criteria for defining theoretically eligible regions.
I am sorry that the rapporteur totally ignores the importance of the maritime coastal areas of the EUROPEAN UNION Member States, which are, however, one of the major characteristics of the countries in the west of our continent. The risk of a population drain is, in fact, real in a large number of areas, particularly those whose peripheral disadvantage is going to continue to deteriorate. Summer tourism would not alone be able to permanently maintain life along our coastlines. A purely regional logic, introducing significant differences in the system from one coastal sector to another, could be extremely disruptive. Therefore, the Member States must be allowed, in general, the necessary flexibility to enable them to promote balanced planning of their territory and to face the risk of a progressive population drain in certain regions. With this end in view, the distribution put forward in terms of geographical coverage of 10 %, 5 %, 2 % and 1 % respectively could not be interpreted strictly. Our group has tabled several amendments in this direction.
This flexibility is particularly important in the areas dependent on fisheries, where it is essential to be able to continue to compensate for the various constraints imposed on fishermen through a carefully targeted intervention of structural aid. This is a necessary condition for the effectiveness and continuity of a fair common fisheries policy. If not, it is no longer even worth the trouble of still talking about a CFP: it will represent nothing more than an empty shell.
It is interesting, finally, to note the oh so careful reservations of the liberal rapporteur that Mr Vallvé represents in relation to the link between employment and public subsidies. It is a paradox that he has not thought to point out that the best way of safeguarding or creating jobs was, for the Member States, to reduce their taxation and alleviate the administrative constraints they impose on companies and, for the European Union, to better promote fair trade.
For all these reasons, our group has not been able to give its support to this report.

ARIANE - KALEIDOSCOPE
President
The next item is the joint debate on the following reports:
A4-0355/98 by Mr Pex, on behalf of the Committee on Culture, Youth, Education and the Media, on the proposal for a European Parliament and Council Decision amending Decision No 2085/97/EC establishing a support programme, including translation, in the field of books and reading (ARIANE Programme) (COM(98)0539 - C4-0544/98-98/0282(COD)); -A4-0356/98 by Mr Pex, on behalf of the Committee on Culture, Youth, Education and the Media, on the proposal for a European Parliament and Council Decision amending Decision No 719/96/EC establishing a programme to support artistic and cultural activities having a European dimension (KALEIDOSCOPE Programme) (COM(98)0539 - C4-0545/98-98/0283(COD)).
Pex
Mr President, I am pleased to have the opportunity today to talk about the Ariane and Kaleidoscope cultural programmes in 1999. Ariane is a programme of Community support, including translation, in the field of books and reading and was introduced for the period 1 January 1997 to 31 December 1998. Over those two budget years, the European Union has provided support for the translation of some 300 literary works, the dissemination of literature by around 80 minority language authors translated into Europe's main languages, the realisation of 60 cooperation projects involving libraries, cultural associations and so on, and training for around 900 literary translators. In short, Ariane has worked very well and deserves to continue.
The second cultural programme, Kaleidoscope, provides Community support for artistic and cultural activities with a European dimension and was set up for the period 1 January 1996 to 31 December 1998. Over this period, Kaleidoscope provided support for 420 cultural projects whose development and execution involved some 1500 cultural institutions from the 15 Member States, the European Free Trade Association and the countries of Central and Eastern Europe. The programme has also contributed to the activities of 50 000 creative or performing artists and other specialists in the cultural sector. It helped 20 000 young people to have access to artistic and cultural activities, it sent 10 000 plays and exhibitions on tour, it paid for 600 traineeships and many other activities. In short, it made a significant contribution to the development and maintenance of artistic and cultural activities in the Union. It would therefore be a great pity if Ariane and Kaleidoscope were to finish on 1 January 1999, only for another programme to begin a year later on 1 January 2000. The Commission's answer here, having caused the problem in the first place, was to launch pilot projects for 1999 to bridge the gap, but it came to nothing because the European Court of Justice ruled that there was no legal basis for such pilot projects.
However, a miracle occurred on the weekend of 12 and 13 September in Linz, when Commissioner Oreja and Austria's Secretary of State for Culture, Mr Wittman, succeeded in persuading the Culture Ministers that it was essential to continue the current programmes.
The budget for 1999 was adapted in record time with the help of all the members of Parliament's Committees on Culture and Budgets, and a proposal to create a legal basis was considered. The decisions were adopted unanimously. However, for technical reasons which I very much regret, the Commission proposal contains smaller budgets than those agreed in the interinstitutional agreement. The decision was to continue on the basis of the 1998 budgets, and this is why today's proposals contain an amendment to increase the budgets to 1998 levels. Parliament is having to do the Commission's homework for it, and we are glad to do so. For the sake of form, I will give you the figures: ECU 4.1 million for Ariane and ECU 10.2 million for Kaleidoscope.
The decision will, I hope, be taken shortly to extend these two cultural programmes next year. In the year 2000 we hope to start a new combination of the programmes, perhaps with a new structure: the first framework programme for culture 2000-2004. It is now up to the Council. The unanimous decision taken by the Culture Ministers will have to be reconfirmed, and unfortunately the Council must decide unanimously. At the last Coreper meeting, people clearly did not know about the Culture Ministers' decision, because there were some Member States that were still raising objections.
I would therefore urge the Council and all the Member States to adopt this decision before the first budget reading in Parliament, so that the actual amounts, currently listed as 'pm' entries, can be included.

von Habsburg
Mr President, I just wanted to add a few words to what Mr Pex said. It is of the utmost importance that we finally convince the governments that after completing the preparations for the euro we are entering a new phase of European development, in which real priority will be given not just to the economy but also to culture. This does not seem to be fully understood yet in the higher echelons, hence all these delays, these difficulties that continue to hamper the cultural programmes. I thank Mr Pex very much for insisting that at least after the millennium we must at last have cultural programmes that preserve the great diversity of European culture.

Wulf-Mathies
Mr President, ladies and gentlemen, you know that with its proposals to extend Kaleidoscope and Ariane the Commission is seeking to ensure the continuity of Community cultural activities for the year 1999. The aim is to bridge the gap in time until the first European Community cultural framework programme for 2000 to 2004 is adopted. Initially, the Commission had planned preparatory measures in the coming year as a transition between the first generation of Kaleidoscope and Ariane and the new framework programme scheduled for the year 2000. These measures were to be geared even then to the main points of the new framework programme. But after the Court of Justice decided in its judgment of 12 May that all Community expenditure requires a legal basis, the Commission preferred to abandon the planned measures, extend the duration of the two programmes and thereby at least ensure continuity.
One major concern here was not to jeopardise the success of the cultural cooperation to date, which has taken the form of the partnerships and networks on cultural matters to which, I am pleased to note, the rapporteur also referred. At the informal trilogue on 21 September, the three institutions agreed to extend the duration of Kaleidoscope and Ariane for 1999, under the same conditions and with the same allocations of funds as in 1998.
Since the Commission proposals are based on a lower amount, to ensure consistency with the 1999 preliminary draft budget, the proposals now need to be amended in the framework of the legislative and budgetary procedure; you will be taking your decision on that shortly. I can only endorse the request by Mr Pex and Mr von Habsburg that we now conclude this chapter with a positive signal.
I wish to thank Parliament and in particular Mr Pex, the rapporteur and chairman of the Committee on Culture, Youth, Education and the Media, for their constructive cooperation. I would also like to thank them for making possible this improvement - which will benefit the Community's cultural activities in 1999 - in such a short time. In this way, they have shown once again how much importance they attach to culture in the context of European integration; let me also emphasise that although subsidiarity and diversity go hand in hand, that definitely does not preclude our having a common awareness of this subsidiarity and diversity and highlighting it through exchanges and through the visibility of our Community activities.

Medina Ortega
Mr President, I apologise to you and to Parliament for taking advantage of your unfailing patience. This time I want to make a point which, in my opinion, has a direct bearing on the two reports we are debating, the Kaleidoscope report on support to artistic and cultural activities and the report, also by Mr Pex, on a programme of support, including translation, in the field of books and reading: the Ariane programme. I say this because yesterday the Nobel Prize Committee awarded the Nobel Prize to a great European writer, José Saramago, who is Portuguese but resident in Spain, an adopted son of my island of Lanzarote, where he lives. I would like to ask the President of Parliament to send a message of congratulation to Mr Saramago, who has actually visited Parliament and taken part in those activities.

President
Thank you very much, Mr Medina. You know there is an old saying that you can never have too much of a good thing. So your remarks are welcome, but the Minutes show that yesterday, immediately after we learned of the award, I did address Parliament along those lines. And I will certainly not forget the matter when we take our leave today. Mr Medina's remarks will of course be included in the Minutes and I am sure they will reinforce what I said yesterday and that the President of Parliament will indeed contact Mr José Saramago.
The joint debate is closed.
We shall now proceed to the vote.
(Parliament adopted the two legislative resolutions)

President
Ladies and gentlemen, I would congratulate Mr Pex on his excellent work with the Committee on Culture, Youth, Education and the Media, which he chairs.

Hawlicek
I greatly welcome today's legislative proposal on extending the Kaleidoscope and Ariane programmes. Even before the summer, the Committee on Culture, Youth, Education and the Media had criticised the fact that without cultural programmes and with only pilot projects the year 1999 would entail a 40 % cut in the culture budget.
Thanks to the efforts of Dr Peter Wittman, the Austrian Secretary of State, a political decision was taken at the informal Council of Culture Ministers in Linz on 11 September 1998 to extend both programmes by one year. With great encouragement from Mr Pex, the chairman of the Committee on Culture, we agreed the amended budget in committee as early as 14 September, and on 21 September the Council, Parliament and the Commission reached political agreement to extend the Kaleidoscope and Ariane programmes by a year.
This agreement provides that the budgetary allocation will remain at the 1998 level, namely ECU 14.3 million rather than the ECU 10.9 million in the Commission proposal.
I am sure Parliament will endorse this justified proposal and that Dr Wittman, the President-in-Office of the Council, will persuade the Council of Culture Ministers to endorse the decision on the ECU 14.3 million at its meeting on 17 November 1998.
The extension of these programmes is an outstanding example of the excellent cooperation between the European Parliament and the Austrian Presidency of the Council.

President
That concludes Parliament's agenda. The Minutes of today's sitting will be submitted for Parliament's approval at the beginning of the next part-session.
Ladies and gentlemen, before the Chamber lights are turned off, I have the pleasant task of thanking Parliament's services for their patient and efficient assistance.
But I would also like to take advantage of the opportunity that Fridays offer for informal statements, to express a feeling which I am sure I share with all of you, at least in general terms. I feel this has been a week when the blue of the European Union flag has been slightly tinged with the colours of the Iberian Peninsula, the colours of the Portuguese and Spanish flags. This week we have seen events which I believe enrich our cultural heritage and our political heritage, although they spring from two very different sources. On the cultural side - as Mr Medina reminded us - Mr Saramago has just been awarded a richly-deserved Nobel Prize. Obviously it is a recognition of his literary powers, but it is also a recognition of the Portuguese language, part of the cultural heritage of our institution. It is an important language not only because of its history and its current contribution in this House, but also because it is a linguistic hand of solidarity and cooperation stretched out towards South America. I think we should congratulate ourselves on that.
And the other point, ladies and gentlemen - and this affects me a little more closely - is that this week the Spanish Head of State, King Juan Carlos, paid us a visit. I think we were all united in giving him a warm reception and, indeed, in laying great emphasis on the value of his pro-European remarks. A superficial observer might have been surprised to find both republicans and monarchists expressing the same feelings, but I say superficial, ladies and gentlemen, because King Juan Carlos is a democrat, and he is no passive democrat. No-one with an honest recollection of recent history can deny the positive contribution he has made to the peaceful transition from dictatorship to democracy in Spain. What is more, he was at the forefront of the defence of our democratic constitution when there was an attempted coup d'état on 23 February one year.
I wanted to say that, ladies and gentlemen, because the contribution to cultural and political heritage which these two figures have made is at one with the modest day-to-day work that we do here and personally, at least for me, that renews my faith in the future of the European Union.

Adjournment of the session
President
I declare the session of the European Parliament adjourned.
(The sitting was closed at 12.45 p.m.)

