European Commissioner for Health and Consumer Protection
Small food producers and rural development
Small Food Producers Forum
Maynooth - Co Kildare, 24 November 2003
I should say first of all that I am delighted to have been invited and to have the opportunity to address this forum here today. It is always a pleasure to come back to Ireland and even more so to escape the bright lights of Dublin for a change and to re-acquaint myself with the splendid Irish countryside, particularly my own home county.
And may I commend the organisers of this event and indeed you the audience for taking a forward looking approach to matters concerning small food producers.
I welcome the opportunity to address an audience with a large contingent of small and medium sized food producers to speak to you directly about some of the obligations, but more especially the great opportunities that arise from the changing face of food production in Ireland and the wider Europe.
I will start by saying a few words on European regulatory activity in relation to small and traditional food production and then move on to deal with what in the future will have a key influence on small food producers rural development, the future of rural economies here in Ireland, and competition.
Raising the standards and the image of the safety of the European food supply has been a major challenge for me since I took up office as European Commissioner for Health and Consumer Protection four years ago.
The framework for the overhaul of the food safety system is nearing completion with the final major elements currently passing through the legislative process. A significant achievement.
As a result, I believe that consumers can have a growing confidence that the regulatory framework for food safety is working on their side. In other words, that food safety is demand led and not producer driven.
As the first European Commissioner for Health and Consumer Protection, with special responsibility for food safety, I am particularly proud of this achievement. Because, the very raison d'etre for the creation of my job was the restoration of consumer confidence in the food safety system, and thereby in the safety of food itself.
Clearly, we do not live in a risk free zone. Almost everything has some associated risk or trade off; there is no such thing as zero risk. Nevertheless, we must ensure that we identify risks, quantify them and manage them appropriately.
Flexibility for Small Producers
Of course in the context of small producers, there are always concerns about over-regulation and the creation of unnecessary barriers to competitiveness.
I am sensitive to these concerns. Yet consumers must be assured that food is safe, whether it is coming from a small cheese producer in the West of Ireland, or from a globalised corporation based in the US.
One issue that I know is of particular interest and relevance to many of you here today is the food hygiene package that I proposed.
Under this new legislation, food operators will bear full and prime responsibility for the food they produce. Safety must be ensured by the implementation of hazard analysis and control principles on which Doctor Wayne Anderson and Siobhan Walsh will be speaking later.
My proposals for food hygiene took careful account of the need to protect diversity. I am acutely aware that real variation often stems from local, regional or geographic factors.
Europe has an unrivalled variety and diversity of food products a strength that I am determined to nurture and foster. Great care was taken not to inadvertently stifle small, local, traditional food producers.
With this in mind, flexibility was built into the hygiene proposals.
For example, there will be flexibility for adaptations of the strict food hygiene requirements to apply to certain traditional methods of production, and for food businesses situated in remote areas. And, flexibility will also be provided for certain infrastructure requirements often a key issue for small, traditional producers.
But let me be clear granting this flexibility will be conditional on maintaining the overall level of food safety. This is not negotiable. Our consumers deserve and demand nothing less. But on the practicalities of achieving that level, we have built in the maximum flexibility possible.
This is good news for small businesses.
Financing for Small Producers
I would also like to mention at this point the agreement on reform of the Common Agricultural Policy, achieved in June of this year.
This historic agreement will introduce a radically different model for agricultural support. It confirms the shift in emphasis away from quantity and towards the promotion of quality production.
It also includes a greater shift in the financial make up of the CAP from the so-called first pillar to the second pillar. To cut through the jargon this means a transfer of funds away from direct support to agriculture in favour of more funding for rural development.
At my insistence, there is a key, new provision inserted in the new Rural Development Regulation of the reformed CAP. This concerns the availability of funding for small food producers to help them to meet standards.
I recognised that it could be difficult to get a small, innovative, food business off the ground, while at the same time, taking care that every single letter of EU legislation was complied with fully.
To address this legitimate concern, we have now provided that significant support will be available to assist small food producers adapt to the introduction of higher standards concerning the environment, public health, animal health and animal welfare.
Aid levels will be adjusted to take account of the impact of additional obligations and operating costs associated with a particular new standard. Such assistance could be available for up to five years, on a reducing scale.
Again, this is good news for small food producers. It is real proof that the Commission is in touch with reality on the ground in the Member States. It is now up to small producers in each Member State to ensure with their own Governments that their concern for such funding is reflected in national priorities.
I will now turn to the broader subject of Rural Development and the challenges facing rural communities. I know this issue is of particular concern, here in Ireland, to Minister O'Cuiv and to the Government.
First, an observation. There was perhaps a tendency in the past to think of the rural economy as being synonymous with agriculture. This is not so.
The rural economy is much broader. We only have to look as far as the UK, when in counting the cost of the 2001 Foot and Mouth epidemic, it transpired that the losses suffered by the agriculture industry were by far outstripped by the losses suffered by the wider UK rural economy, tourism in particular.
Rural development policies are simply not a tool to top-up CAP payments. Whilst restructuring of the farming sector is an important element of rural development, it is far from being the entire picture. We have to look at rural development in the broader context. We need to take a horizontal approach.
One of the principal drivers of European rural development policy is the desire to achieve sustainable development. This means establishing self-sustaining and confident rural communities that can stand up for themselves, rather than being dependent on State support on an ongoing basis.
And this is not just a question of economics. It is also a social imperative to create the conditions for rural communities to prosper, thrive and maintain their identity, on a self-sustaining basis into the future.
Forward looking rural economies
Achieving these ambitions requires a radical shift in thinking and perception. Rural areas are not open air museums, harking back to a bygone age. Being rural and being modern must not be seen as a contradiction in terms.
I am certainly not advocating turning our backs on tradition.
But I do advocate making sure that traditional activities are in tune with the modern world and that rural communities adopt a forward not backward looking agenda.
Rural economies can produce traditional foods, for example, while at the same time being “online” to market these quality products in Europe or Asia.
Rural Development the Next Generation
The foundations of EU Rural Development policy were established here in Ireland, in Cork to be precise, in 1996. This paved the way for the introduction of rural development into the CAP in the Agenda 2000 package.
However, in the Commission, we are now turning our attention to how rural development policy might develop in future.
It is clear that we must strengthen and, indeed, simplifying EU rural development policy.
Broadly speaking I see three important policy goals:
Food production in rural economies
Allow me now to focus a little more on food production. The CAP reform agreement represents a major challenge for food producers and small producers are certainly no exception. Whilst it is true that continued support, decoupled from production, will continue to contribute to the viability of agricultural businesses at least for the foreseeable future, that alone will not be sufficient to ensure long-term sustainability and success.
The status quo is simply not an option. Primary food production is drawing ever closer to the market. And just like any other market the mechanisms of supply and demand must and will apply.
The years ahead can be expected to bring increasing liberalisation of trade in agricultural products, despite the recent failure of the WTO talks in Cancun. This means that quality and added-value will become increasingly important ingredients for future success, both on the domestic and export market.
Future rural economies not agriculture dependent
But, let me be a little provocative the success of rural economies into the future will not depend on the success of agriculture or farming on their own.
Greater wealth and consumer interest will fuel demand for all sorts of diversification in rural economies. To meet such demand we must ensure that rural communities are equipped to take advantage of the opportunities of the changing consumer-led landscape.
Diversification within, and most significantly beyond, the agriculture sector will become essential for rural economies to compete. If rural economies cannot compete then they will lose out, decline and die.
Therefore policy going forward has to adapt to this new imperative.
Looking beyond 2006, the Commission is currently working on the financing of the Union's policies into the next decade.
We are not just looking at the policies themselves, but on the amounts that should be devoted to them and how the finances would be most efficiently and effectively spent.
It seems clear to me that we need to think a fair bit more radically about the financing framework for rural development, if a golden opportunity for the next generation of rural development and sustainable development is not to be lost.
For example, significant expenditure under the existing rural development programme has been devoted to restructuring the farming sector in the existing 15 Member States. Is it not now time to concentrate on other issues in the rural economy enterprise development, marketing local or regional brands, high tech initiatives, e-learning links, the potential goes on and on.
But these are key choices for the future competitiveness and success of rural economies.
Ladies and gentlemen, I firmly believe that Irish food production is ideally placed to take maximum advantage of the expanding opportunities to gain new markets. Irish quality products are already renowned for their excellence. Indeed in my adopted city of Brussels supermarket shelves already feature Irish products heavily in particular beef and butter.
To conclude, there are challenging times ahead for European food producers and rural economies. My message to you is don't stand still. Plan now to ensure that you are not left behind by the rapidly changing market climate.