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Commissioner
Fischler’s Mid Term Review (MTR) of the CAP attempts to progressively
reduce EU production subsidies by "de-coupling" (i.e. payments
will not relate to present farming activities) in order to meet EU
commitments to the WTO. Although farmers will continue to receive support
for diversification and enhancing the environment to sustain rural
economies, the changes proposed have precipitated grave concerns amongst
many UK farmers, particularly in North Hertfordshire.
Whilst
the EU subsidises farmers growing cereals, oil seed rape and land set
aside, it does not offer subsidy for growing potatoes, vegetables and soft
fruit. The MTR proposes de-coupling with a single payment to farmers,
basing the payment on average claims between 2000-2002. This mode of
compensation has the following consequences:-
-
It
bases future compensation
on what farmers grew during 2000-2002. Therefore, cereal and oil seed
rape farmers who received substantial compensation during 2000-2002
period will continue to receive higher subsidies (€375 per hectare)
in future, compared to those who grew vegetables and fruit during
2000-2002, therefore attracting zero EU subsidy.
-
Such
a difference in subsidy for neighbouring farms will distort land
valuations and penalise existing vegetable and fruit farmers - both
landowners and tenants. EU subsidy should be tied to the land and made
transferable to whomever farms the land at any time.
-
Farmers
deprived of their ability to switch crops from vegetables to cereals
will lose their bargaining power with buyers/contractors.
-
Vegetable
and fruit farmers will have no incentive to rotate crops by switching
their pea acreage to cereals and oil seed rape.
I
believe that a fair proposal for the MTR of the CAP would be as follows:
The
EU should amend the basis for the calculation of the Payment Entitlements
to include an allowance for AAPS (Arable Area Payments Scheme) registered
land which had been used for vegetables, fruit and potatoes during the
reference period of 2000-2002. Under such a scheme, the entitlements would
be based on the total amount that the farmer received under the relevant
support schemes as well as the AAPS aid to which he would have been
entitled had he grown cereal instead of unsupported crops on AAPS
registered land. This would have a diluting effect of about 6.5% on the
total UK AAPS payments as the acreage for unsupported crops is very low.
This solution would mean:
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Fair
treatment of every arable farmer
-
Genuine
de-coupling
-
Total
flexibility of cropping into the future
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Compliance
with WTO regulation
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No
need for detailed annual IACS forms
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No
distortion of land values
-
Solutions
to problems 1,2,3 and 4 listed above
-
Reduced
intensification of vegetable and potato production
Commissioner
Fischler is right to introduce de-coupling to reform the CAP. However, he
must formulate an appropriate mechanism for compensation that can sustain
good agricultural practice without distorting land values. His proposals
must also allow farmers to produce a variety of crops including cereals,
oil seed rape, vegetables and soft fruit. I have written to both Mr
Fischler and Margaret Beckett expressing these views and await their
response.
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