New members from the east will kill CAP

The European Union must reform the Common Agricultural Policy (CAP) before it lets in new members from central Europe, according to four new EU studies.The EU would have to spend as much as £25bn a year more on farm subsidies if the new countries were admitted without reform, say the reports. But the European Commission's own agriculture officials contest the figure, saying that substantial reform is not needed. "A long-overdue debate is getting into top gear," said a Commission official yesterda y.

The reports, by experts from France, Britain, Italy and Germany, vary in their analyses. But they converge on the view that the system must be changed before new countries can come in. Otherwise, the costs would be exorbitant - between 13.5 and 32.5bn ecus (£10.6bn and £25.5bn). The CAP will also run into problems staying within the rules laid down by the Uruguay Round of the General Agreement on Tariffs and Trade (Gatt), the pact that was supposed to ensure an end to world farm trade wars.

One report, by the UK's Professor Alan Buckwell of Wye College, says that "an EU with 21 states will not be able to respect its [Gatt] commitments". Stefan Tangermann of Germany, argues that "price support is likely to threaten long-term productivity" i n the new entrants. Secondo Tarditi of Italy said: "The effects on economic efficiency, income distribution, and the environment would be socially desirable." And according to Louis Mahe of France, "extending fully the current CAP does not seem feasible o r advisable".

The Commission is divided on this: its agricultural service reckons existing reforms have gone a long way towards solving the problem. The overall cost might be as low as 4-5 bn ecus, and this could be handled within the existing EU budget.

The Commission is preparing its own analysis of the problem, one of the most divisive that Europe has to confront in the next few years. In June it will deliver a report on the agricultural situation in central Europe, and in December a more far-reachingdocument on the next steps. A call for reform would be highly divisive: the CAP is the bedrock of the EU and loss of revenue would cause a storm. "Politically, it's impossible to reform the CAP again," said one Commission official.

But others disagree. The four reports released yesterday were put together by independent experts for Sir Leon Brittan, the Trade Commissioner, who was in charge of eastern Europe under the outgoing Commission. They have clearly been released now to get a debate under way as the EU examines all the aspects of bringing in Central and Eastern Europe.

The last round of reform of the Common Agricultural Policy is already causing problems, with France, for example, concerned about the impact on its cereal exporters. Officials say that the reforms were "a little bit too successful" last year, but add th a t things are improving.

Everyone agrees that the figures being bandied around at the moment are unreliable. "All the data is very questionable," said the Commission official. The politics, however, are not in doubt. France currently holds the presidency of the European Union, and will not be in a mood to allow the issue to surface until well after its Presidential election in spring.