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EU wrong to get involved in provision of free fruit and vegetables

Yesterday, the Agriculture and Rural Development Commissioner announced an EU-wide scheme to provide free fruit and vegetables to school children between the ages of 6 and 10. The purpose of the scheme is to encourage more healthy eating habits among children as a contribution to the campaign to fight the obesity epidemic which is storing up very large health costs for European countries in the future.

While the objectives of the scheme are entirely laudable and should be supported, I strongly question what business the EU has getting involved in promoting a School Fruit Scheme (although the scheme also covers vegetables, it seems to be referred to as a fruit scheme – vegetables were always the poor relation!). It simply does not pass the subsidiarity test without stretching the parameters of that test to meaningless levels.

One of the rationales for the scheme is that it would help to bring the EU closer to its citizens. But it could end up having the opposite effect. If citizens cannot be certain where the competences of the member states end and those of the EU begins, then the EU becomes a threatening competitor to national sovereignties rather than a constructive vehicle for collective action. Alienation of this kind was one of the reasons for the defeat of the Lisbon Treaty in the recent Irish referendum.

The School Fruit Scheme proposal

The proposal is part of the new Common Market Organisation for fruit and vegetables in place since 1 January 2008. When approving the Fruit and Vegetables CMO reform, the Council made the following declaration: “In light of the dramatic increase in obesity amongst schoolchildren, which has been highlighted in the recently published Commission White Paper … the Council invites the Commission to come forward with a proposal for a school fruit scheme as soon as possible based on an impact assessment of the benefits, practicability and administrative costs involved.”

Under the proposal, European funds worth €90 million every year would pay for the purchase and distribution of fresh fruit and vegetables to schools, and this money would be matched by national funds in those Member States which chose to make use of the programme.

Different school fruit schemes already exist in some European countries, but according to the Commission proposal “much more” can be done and the EU scheme will help to upgrade existing initiatives as well as “get new programmes off the ground”. The Commission suggests funding 50% of the national initiatives and 75% of the programmes in the convergence regions where GDP per capita is lower.

If the proposal is adopted, EU co-funded distribution of fruit and vegetables would begin at the start of the 2009/2010 school year.

The need for increased fruit and vegetable consumption among children

There is no doubt about the desirability of encouraging increased fruit and vegetable consumption among children.

Consumption of fruit and vegetables in Europe is at best stagnating and, in most cases, is at a level well below the WHO minimum recommendation of 400 gr/day. Among the youngest, the level of consumption is even more worrying.

The rise in childhood obesity is now reaching an epidemic level in Europe. In the EU, nearly a quarter of overweight children are obese, around 3 million, and medically at risk of several diseases.

A balanced diet, rich in fruit and vegetables, combined with increased physical activity are the two recognised and undisputed steps to rectify obesity. A causal relationship between obesity and lack of fresh fruit and vegetables consumption is well-established.

The importance of subsidiarity

The presentation of a School Fruit Scheme proposal was conditional on the conclusions of an assessment demonstrating its value added at European level and analysing the advantages and drawbacks of different options. The two questions posed in the public consultation were:

What are the strengths and weaknesses as well as necessary conditions for successful implementation of such programs?

What is the added-value by European action to existing programs in the Member states and regions?

The second question raises the subsidiarity test. No matter how valuable the initiative, if there is no value added at the EU level, it should be left to the member states. The two instances where value added can be clearly established are the existence of trans-boundary externalities and the existence of economies of scale in undertaking the action at the EU level.

In fact, the consultation process focused on the first of these two questions but ignored the second, so the relevance of the subsidiarity test was never aired. However, in the Commission impact assessment of the School Fruit Scheme proposal, an attempt is made to justify the value added at the European level the proposal would have.

Treaty basis

Before looking at the arguments put forward, it is interesting to examine the Treaty basis for the proposal. Two alternatives were considered in the impact assessment.

Article 37 gives the Commission authority to submit proposals necessary to achieve the objectives of the Common Agricultural Policy set out in Article 33. Article 152 requires that a high level of human health protection shall be ensured both in the definition and implementation of all Community policies and activities (which includes the CAP).

The impact assessment concludes that the latter article would be too thin a justification for introducing the School Fruit Scheme measure, making clear that despite the high-flown rhetoric about saving our children from obesity, the scheme is basically about contributing to stabilising and enhancing the market for fruit and vegetables in support of the objectives of the CAP. It contributes to one of the objectives of the reformed CMO by helping to reverse the declining consumption of fruit and vegetables.

The arguments for EU value added

To pass the subsidiarity test, a proposal must be shown to be necessary and to add value in a way which would not be possible by member state actions alone. A problem clearly exists so there is no difficulty in passing the necessity test by pointing to the low consumption of fruit and vegetables and the growing problem of obesity.

The impact assessment admits that “these problems could be dealt with to some extent at national level but a number of transnational elements imply that action at EU level would be appropriate and desirable.” Four arguments are advanced to show how the EU would add value over and above member state action in the case of the School Fruit Scheme.

A significant EU budget allocation would allow the extension of existing SFS in several Member States, while encouraging those that are not yet active, often due to limited budgetary means, to start schemes;

A lack of EU action and the continuation of activities exclusively at Member States level would create the risk of discrimination between producers in those countries that do have no access to an SFS as a market outlet and the resulting incentive for innovative products. This could have an effect on their competitive position;

An exchange of experience and transfer of know-how between project promoters in Member States foster the development of best-practice models and supports the creation of schemes in Member States that are not yet active;

Health costs of obesity related diseases, especially diabetes and cardio-vascular diseases (CDV). This is not only an individual Member State responsibility, as crossborder healthcare has been reinforced by European Court of Justice case law.

The impact assessment concludes by stating that a School Fruit Scheme would not be a panacea for the problems described but would produce clear benefits compared with action at Member States level.

Critique

Of these four arguments, only the last has a genuinely transnational element. The first argument may make sense as a covert way of redistributing resources from richer to poorer member states, getting round the 4% cap on transfers under the cohesion policy. The second argument makes no sense at all, as under the internal market access to a school fruit scheme cannot be confined to one’s own producers. The third argument makes perfect sense, but does not require the EU to get directly involved in providing free fruit and vegetables to make it happen.

The fourth argument is the only one to really address the subsidiarity issue, and runs as follows. If I take a short-sighted view as a country and allow my citizens to get fat and lazy, ultimately my health service will collapse under the strain of diet- and obesity-related illnesses and other member states will be left to pick up the cost of treatment. Its a classic case of a transboundary externality – in theory. The question is how important this is likely to be in practice, as here the third leg of subsidiarity comes in, proportionality. Are there other mechanisms which could achieve the same objective at less cost?

One of the weaknesses of the impact assessment process is that it doesn’t really consider a range of alternative policies which might address the same objective. If the Commission’s aim is really to increase fruit and vegetable consumption, then why not simply remove the tariffs which keep the prices of fruits and vegetables high. Bananas, for example, must pay a tax of €176 per tonne on entering the Union, or an ad valorem rate of around 25%.

Is the purpose of the School Fruit Scheme really to address childhood obesity, or is it to create a market for EU fruit and vegetable producers?

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