Letter: Creative accounting helps EC agriculture

Sir: On 17 December 1992, the EC agreed a budget for 1993 for the Common Agricultural Policy of 34bn ecu ( pounds 28bn). By mid-January the Commission announced that the figure would need to be increased by about another 1bn ecu ( pounds 830m). This is mainly due to the Council of Minister's decision to maintain the switch-over mechanism, which directly impacts on agricultural expenditure each time a currency realignment takes place.

Every time there has been a devaluation in the EC, whether in Spain, Italy, Portugal, Ireland or the UK, the price of CAP commodities has gone up, because CAP payments are in ecus. Eventually these increases will be reflected in price rises in the shops. So we have people paying more as consumers, then paying more as taxpayers to prop up a defunct system that is running out of control and will lead to an EC budgetary crisis in 1994. So far, 1993 has seen an increase of about 3.9bn ecu ( pounds 3.2bn) over 1992, or 12.5 per cent, in CAP spending.

Rene Steichen, the new Agricultural Commissioner, has admitted the 1994 agricultural basket will not have sufficient financial resources available to it. No doubt the Government will help in some form of creative accounting to ensure the money is available. Why is it that the Government objects to the coal industry or Leyland DAF being helped by public subsidies in times of monetary crisis, but is happy for agriculture to be subsidised to the hilt?

Yours faithfully,

TERRY WYNN

MEP for Merseyside East (Lab)

St Helens, Merseyside

10 February

The writer is European Parliament General Rapporteur for the 1994 budget.