The CAP won't fit them all PROPOSITIONS

Agricultural reform is a small price to pay for stability, writes Tony Barber

An irresistible force is heading straight towards an immovable object in the European Union. The force is the determination of the EU's 15 states to extend membership to newly democratic countries in central and eastern Europe. The object is the EU's Common Agricultural Policy.

The CAP cannot be retained in its present form if the Czech Republic, Hungary, Poland, Slovakia and other former Communist states are to be admitted. It would be far too expensive.

Yet to undertake fundamental reform of the CAP risks upsetting big EU farming nations such as France and Spain: so much so that they could try to delay central and eastern European entry into the EU. Sooner or later, and most probably at next year's intergovernmental conference on revising the Maastricht treaty, this will turn into an almighty argument within the Union.

The CAP is the sort of subject which (as the saying goes) only one person has understood, but he has forgotten what it was he understood. In fact, the principle behind the CAP is relatively straightforward: to keep EU farmers prosperous by providing them with income support. The subsidies have grown so large over the years that they could not possibly be extended to farmers in central and eastern Europe without busting the EU budget.

In 1993, farm subsidies ate up 35bn ecu (£28bn) of the EU's 69bn ecu budget. Reforms to the CAP were announced in 1992 and are having some impact on EU spending. Even so, the CAP is expected to account for 38bn ecu this year out of a total budget of 81bn ecu. The proportion of the EU budget going to agriculture has always been contentious: it inspired yesterday's Labour-sponsored vote at Westminster.

To get some idea of what would happen if central and eastern European farmers received the benefits of the CAP in its present form, consider the words of Hans van den Broek, the EU commissioner for the region: "It would mean doubling or even tripling the EU budget," he said. "Let us conclude that a simple transfer of the operation of the CAP to the central and eastern Europeans could not be financed, and would lead to catastrophic overproduction."

A related point is that the former Communist countries would qualify for the EU's so-called "structural funds" - money transferred from rich countries to poor ones. At the moment structural funds account for 25bn ecu a year. The biggest beneficiaries are countries such as Spain, Portugal and Greece.

The central and eastern Europeans, though entering a period of economic growth, are still much poorer than the Mediterranean nations were when they joined the EU in the Eighties. The EU simply does not have the money to apply the structural funds programme to central and eastern Europe.

The EU's agriculture commissioner, Franz Fischler of Austria, claims CAP spending is being brought under control and the programme does not need a drastic overhaul before the central and eastern Europeans can join the EU. France and the poorer southern EU states also oppose sweeping changes. In general, however, the debate is no longer about the principle of agricultural reform, but about how far-reaching it needs to be. And when the debate really kicks off, yesterday's spat in Westminster will look like a tea party.

But no matter. Amid the wrangling, the EU is in danger of losing sight of the most essential point: that the EU has an overriding strategic interest and moral obligation to promote stability and prosperity in central and eastern Europe. Twice this century the region has been sacrificed to totalitarianism. Reforming the CAP is a small price to pay for preventing a recurrence of such tragedy.