I propose to take Questions Nos. 18 and 74 together.
At its meeting in Brussels on 24 and 25 October 2002, the European Council decided that direct payments should be introduced incrementally to the new member states, with the first increment of 25% of the level applicable in the Union of 15 to apply in 2004, followed by three increments of 5% in the next three years, and, from 2008, by annual increments of 10%, reaching 100% in 2013. CAP market supports will apply in the new member states from the date of accession. The Council also decided that the total annual outlay on market-related expenditure and direct payments should not exceed the amount in real terms of the ceiling set for these expenditures for the Union of 15 for 2006 by the Berlin European Council plus the amount of these expenditures for the ten new member states in 2006, as estimated by the Commission. These two amounts, €42.8 billion and €2.5 billion respectively, total €45.3 billion which constitutes the baseline for future years. The Council decided that expenditure in nominal terms between 2007 and 2013 should be kept within the baseline increased by 1% a year. The decisions relate to a Union of 25 member states and a separate decision about funding for Bulgaria and Romania will have to be made prior to their accession, which at present is targeted for 2007.
The agreement reached at the Brussels European Council represents a fair and acceptable balance between all the competing interests. It also provides assurances to farmers about the availability of funding for the CAP until 2013. The decisions reached by the European Council now form part of the EU's negotiating position with the applicant countries. Final decisions are expected to be taken on terms of accession of these countries at the Copenhagen European Council meeting which is scheduled for mid-December.