The European Court of Auditors has suggested fundamental reforms of the dairy sector, including the abolition of the present quota system.
The objective is to bring the European Union’s milk production into line with unsubsidised internal consumption and potential unsubsidised exports.
Other recommendations include allowing the transfer of quotas between milk producers operating in different member states and the offset of any overruns and shortfalls between member states.
The suggestions follow a report by the court which stated that although the quota system has proved successful in reducing milk production, the regime is still not rigorously applied to all member states.
The report also said that if the Community milk price is compared with the world market price, the EU consumer is paying a considerably higher price for its milk.
The report noted that substantial financial support would still be necessary for the disposal of milk surpluses and that the future enlargement of the EU would probably increase the amount required from the budget to cope with this.
Meanwhile, at the third special session meeting of the World Trade Organisation Committee on Agriculture in Geneva, Switzerland, the EU proposed the introduction of a mechanism to protect products of designated origins.
The European Commission’s negotiator David Roberts said: