By Jeremy Smith
BRUSSELS (Reuters) - Europe's farm chief is thinking ofputting more cash into a scheme that feeds millions of poorpeople after radical policy changes ended the EU's notoriousgrain mountains and milk lakes of the 1980s and 1990s.
The food aid scheme was set up during Europe'sexceptionally cold winter of 1986 when surplus stocks of foodcommodities were given to national charities to distribute toneedy people. Now, after a series of policy changes, thosestocks are mostly gone.
Before the EU's reform of its Common Agricultural Policy(CAP) in 2003, public intervention stocks of cereals, beef,butter, milk powder, olive oil, rice and sugar were usuallyplentiful and stored around Europe at taxpayers' expense.
But those large surplus stocks, for which the EU washeavily criticised by its trading partners for exporting withsubsidies, are now mostly non-existent, with the exception ofsugar.
"We have a scheme that was based on intervention stocks,which don't really exist any more, so it (the food aid scheme)needs to be redone," one official at the European Commissionsaid.
EU Agriculture Commissioner Mariann Fischer Boel is due topropose revisions to the 22-year-old scheme in mid-Septemberand is expected to recommend a tendering system for nationalgovernments to buy food from their own local markets.
While details are still being worked out, she is believedto recommend increased spending for 2009, with a budget thatmight extend up to 500 million euros (396.7 million pounds)compared with the 310 million euros earmarked in the 2008spending plan that will provide millions of meals in 19 of theEU's 27 countries.
Then, from 2010 onwards, EU governments would match-fundthe amounts of cash they received from Brussels, euro for euro,to raise the total amount of available cash for Europe's "mostdeprived", as the scheme is formally known.
More economically disadvantaged areas would get 75 percentof their bill paid by EU money, the official suggested.
"It would still be a bigger budget than now, plusco-financing (match-funding). The member states would, on anational level, tender to buy food off the market in their owncountries," he said.
For 2008, about 67,000 tonnes of sugar is available to behanded out free from public stocks.
For other commodities, the European Commission hasallocated 86 million euros to buy cereals, 15 million to buyrice and 160 million euros to buy skimmed milk powder, officialdata showed.
As the EU's farm surpluses have fallen, the food aid schemehas been bolstered by direct cash contributions first used in1995. For this year's distribution plan, the Commission hasmade finance available for charities to buy food on the openmarket.
(Editing by Christopher Johnson)
