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Rural Development Programme for England

Volume 451: debated on Wednesday 1 November 2006

The Rural Development Programme for England 2007-2013, implementing the new European Rural Development Regulation, is an important element of the Government's strategy for the future of rural development and the environment. We set out our proposed priorities for the new programme in a consultation document1 earlier this year, and since then have discussed them extensively both at national and regional levels.

On 24 May 20062, the European Commission published proposals for implementing all EU programmes during 2007-2013 in the light of the budget agreement reached by the European Council in December 2005. For rural development, these proposals included the draft allocation of funding for member states and a draft regulation governing the application of voluntary modulation. On 19 June 20063, the EU Agriculture Council confirmed the overall allocation of rural development funds, and on 12 September these were formally allocated to individual member states through Commission Decision 636 of 20064.

The Government have always stressed that the final shape and size of the new Rural Development Programme for England is dependent on the availability of receipts from voluntary modulation. In the draft proposal on voluntary modulation (VM) currently under negotiation in the Agriculture Council a number of important issues remain unresolved, including on regionalisation (i.e. whether or not we are able to set separate rates for England, Scotland, Wales and Northern Ireland) and the franchise. We are continuing to discuss these issues in Brussels but the draft voluntary modulation regulation cannot be agreed by the Agriculture Council until a formal consultation procedure with the European Parliament has been completed.

However, at present progress of the regulationis stalled in the European Parliament. The EP's Agriculture Committee has recommended rejectionof the Commission's proposal and a plenary vote scheduled for 26 October was postponed for procedural reasons. It is likely to take some time before the consultation procedure with the Parliament is completed and the details of the regulation will then need to be finalised by the Council. We now anticipate that this process, and the regulation itself, is unlikely to be concluded before spring 2007.

The Government's preparations for the new programme are well advanced. But until the voluntary modulation negotiations are concluded at the EU level, we cannot reach our own decisions on the rate of VM and the total budget for the programme. We therefore cannot submit our programme for approval in Brussels, as we are required to do. (Once the programme is submitted, the approval process can take up to an additional six months.)

These delays mean that the new Rural Development Programme for England will not be able to start on time on 1 January 2007. This is deeply disappointing to me and my Department, but above all to farmers, land managers and other potential beneficiaries in rural areas who want clarity about what rural development funding will be available in 2007-2013 as soon as possible.

Our intention remains for the new programme to start at the earliest possible date and my officials are working closely with the European Commission, delivery bodies and a wide range of stakeholders to achieve this. I can reassure existing beneficiaries that their agreements will continue to be honoured. Weare also considering carefully the contingency arrangements for rural development scheme delivery that will apply in the absence of formal approval for our new programme. I will continue to keep the House informed about these and any other developments.



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