The Press MONDAY, MARCH 29, 1971. Agricultural reform in Europe

Press, Volume CXI, Issue 32567, 29 March 1971, Page 14

The Press MONDAY, MARCH 29, 1971. Agricultural reform in Europe

The political rumpus over next year’s prices for farm products in the European Economic Community has tended to obscure the fundamental issues involved. It is scarcely an exaggeration to say that the future structure of farming in Western Europe—and the chances of Britain’s admission to the E.E.C.—hung in the balance during last week’s conference in Brussels of the E.E.C.’s Ministers of Agriculture. With some reservations, the outcome of the conference may be said to be a vote in favour of the structural reform of European farming and an assurance to Britain that the cost of entry will not be prohibitive.

The E.E.C.’s farmers, in the production year starting on April 1, will be paid 1 per cent more for maize than in 1970-71, up to 10 per cent more for beef (but the full increase in this price will not be paid until 1972-73), and an average of 5 per cent more for all farm products. The farmers, who had had virtually no increases tor three years, had demanded an average increase of 15 per cent The huge sum of $1322 million will be made available over the next four years for Community financing of farm projects—mainly projects aimed at amalgamating small, uneconomic holdings, introducing mechanisation and modern farming techniques and retraining displaced farm workers.

The farmers’ demonstrations in the streets of Brussels last week, and the violence provoked by the demonstrations, caught the headlines; but historians win probably judge the Ministers’ approval of Community financing of farm projects to be the momentous event of that week. By denying them the price increases they had sought, the Ministers must surely have persuaded many farmers to think seriously about giving up farming as a way of life. Indisputably the correct decision, economically, has been reached by politicians faced with an agonising dilemma; and the decision now demands a cruel choice by hundreds of thousands of European farmers, most of them descended from peasants whose forbears have lived on the same land for hundreds of years.

The displaced French or Belgian peasant, coaxed into a city factory, will probably be better off materially than he could ever have been on his few wretched acres; whether he will be any happier is open to doubt But there is no doubt that even the wealthiest nations of Europe could not afford to subsidise archaic farming methods so that an army of peasants enjoyed the standard of living made possible by modern technology in Europe’s factories; and this is virtually what the farmers were demanding. The implications of last week’s Brussels meeting extend far beyond the present borders of the Six. They will be closely studied in Washington, London, and Wellington, to name only three of the capitals to which the future course of Europe’s trade is important.

North America exports grain, frozen chicken, and dozens of other agricultural products to Europe. Any increase in farm support prices in Europe damages that trade; Washington should be grateful that the higher prices negotiated last week were no higher; In London the reaction should also be one of relief; had the agreed prices been much higher they would have imposed on British exchequer and on the British housewife—in the event of Britain’s accession to the Common Market—a burden that might have been intolerable.

From New Zealand’s point of view the decision may be regarded as economically damaging in the short term—if it improves the prospects of Britain’s entry into a protectionist trading bloc—or as encouraging in the long term, if it heralds the end of an era of inefficient, highly-protected food production in Europe. Either interpretation is probably oversimplified, for Britain’s entry into Europe might modify the E.E.C.’s protectionist outlook, and the E.E.C., with or without Britain, will always protect its farmers to some extent An optimistic interpretation is still justified: if the E.E.C.’s politicians can withstand such political pressures as were brought to bear last week, does this not suggest they are capable of sinking petty differences in their final negotiations with Britain? That they might even allow Britain to continue importing New Zealand butter and lamb after Britain has joined the Common Market?