Member states clash over redistribution of farm aid
By Ed Bray | Wednesday 27 June 2012
The battle over the future distribution of EU farm subsidies hardened on June 26, as a number of member states told the General Affairs Council that the proposed rate of convergence between differing support levels was insufficient, while Belgium sought to limit the shift. In a non-paper circulated among ministers during their discussions on the future multiannual financial framework (MFF), Belgium said that the rebalancing of direct payments across the EU “must be carried out over a sufficiently long time in order to allow farmers the time needed to adapt to the new situation”. “Undesirable destabilising effects” must be avoided for farmers in those member states that will be required to fund the fairer redistribution, Belgium said. But Estonia, Latvia and Lithuania – whose farmers currently receive some of the lowest farm payments per hectare in the EU – have said that faster rebalancing of payments must be a main element of the MFF ‘negotiating box’. Absence of such a clause would threaten a deal on the long-term budget, they said. Their statements come ahead of a protest by Latvian farmers, planned for 28 June in front of the EU Council, to criticise “the unfairness of the EU’s agricultural policy”.
Under Commission proposals for reforming the Common Agricultural Policy, member states with above-average aid levels would be required in a proportionate way to fund the convergence, closing by one third the gap between below-average aid levels and 90% of the EU average by 2020. Belgium said this approach would have a “considerable harmful effect” on those countries that are required to contribute “disproportionally” more to the move. Instead, they said the member states should contribute in a linear way, with criteria such as labour costs and land prices taken into consideration. Contributions from each country should be capped at a maximum of 4%, they added. Meanwhile, Belgium has suggested that the redistribution of farm aid should cover amounts received under both Pillar 1 (direct aid) and Pillar 2 (rural development) simultaneously. “No member state should face losses in both pillars,” they said.
The suggestions – that gained some support from France and Italy during the MFF discussions – face stiff opposition from the newer member states, which say the proposed shift would still leave their farmers with unfair levels of support and leave them open to unreasonable competition. Poland, Portugal, Slovenia, Romania and Bulgaria added their strong support during the MFF talks, saying convergence should be faster.
Meanwhile, in another budget battle, more liberal-minded member states, such as the UK and Sweden, are backing a reference in the ‘negotiation box’ to a yearly linear cut to farmers’ direct aid - a move strongly rejected by Ireland, France, Spain and Austria. For their part, newer member states, such as the Czech Republic, Hungary, Slovakia and Poland, have said they would not oppose this approach if an amendment was included to exclude those countries with direct aid levels below the EU average.