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Euro farm subsidies help brit queen and big farm { November 7 2007 } Original Source Link: (May no longer be active)
http://www.iht.com/articles/2007/11/07/europe/union.phphttp://www.iht.com/articles/2007/11/07/europe/union.php
EU leaders to submit new plan on farm subsidy cuts
By Stephen Castle
Wednesday, November 7, 2007
BRUSSELS: Queen Elizabeth II of England and the owners of East Germany's Communist-era collective farms are among those who stand to lose out from new plans to curb EU farm subsidies to Europe's largest landowners.
The proposal, to be submitted later this month, marks a renewed effort to reform one part of the bloc's system of agricultural subsidies whose beneficiaries include some of the richest people in Britain and on the Continent.
Under the plans, payments would be scaled back once they reached a certain level, most probably €100,000, or $146,000, thereby hitting the biggest landowners.
With records of farm payments public in many EU countries, the fact that some of Europe's wealthiest people benefit from subsidies has become a growing embarrassment. Agriculture is a favored pursuit of British royalty and nobility, including Prince Charles, who runs a farm near Highgrove.
The level of payments to the richest landowners remains difficult to identify with precision because ownership of individual holdings is not always clear.
Data from the 2003-2004 farming year indicated that the queen and Prince Charles received €360,000; the Duke of Westminster €260,000; and the Duke of Marlborough €300,000, according to a study by Richard Baldwin of the Graduate Institute of International Studies in Geneva. A report in The Guardian newspaper said that the queen and Prince Charles received a total of more than £1 million, or $2.1 million, in EU farm subsidies over two years.
Though no firm figures for the reduction of subsidies were to be proposed, a paper compiled by the European Commission suggested "by way of example" that payments above €100,000 could be reduced by 10 percent, those above €200,000 by 25 percent, and those above €300,000 by 45 percent.
But despite the damage these subsidies to the wealthy did to the reputation of the EU Common Agricultural Policy, the reform would be difficult to achieve because it needed backing from national governments.
In 2002 a plan to cap farm subsidies at €300,000 was blocked by Germany and Britain. While the government in London has called for reform of the CAP, this particular change poses a dilemma because a large proportion of the subsidies received by British farmers go to bigger holdings.
Despite the earlier setback in 2002, an internal document from the commission reviewing the CAP says it would be "appropriate to look into the possibility of introducing some form of limitation in payments."
"If a solution is to be found it would be in a model where the support level is gradually reduced as overall payments to the individual farmer increase, while retaining some support even at high overall payment levels," it adds.
Such proposals should also be designed so that farmers do not try to circumvent any new legislation by splitting up farms, the document argues.
"We want to give it another go," said Michael Mann, spokesman for the agriculture commissioner, Mariann Fischer Boel, describing the proposal as a more nuanced approach aimed at a way of achieving "a better way of handling available resources."
Money saved would be switched to a fund for rural development designed to fund environmentally sustainable projects for the countryside, Mann added.
Were the plan to be approved, the biggest losers would be in Britain and Germany, where many of the biggest farms are concentrated. Though some French farmers also have large holdings, their ownership is often divided because of restrictions imposed by French law and by its patterns of inheritance.
But big farmers argue that, although they may achieve economies of scale, they still have the same obligation to protect the countryside as their smaller counterparts.
Simon Michel-Berger of the European farming lobby group Copa-Cogeca said the proposal was being discussed internally but that the organization "does not have a position on it at the moment."
Jack Thurston, co-founder of farmsubsidy.org, which campaigns for greater transparency over payments, said his calculations showed the commission proposal would affect only 1.7 percent of spending on direct farm aid.
"It is a less ambitious proposals than the previous one," he said, "though clearly it has a certain level of sophistication because of the sliding scale. This would diminish the incentive for people to artificially divide their farms."
Thurston added that the reform would be symbolic rather than real "since the kind of figures being talked about are so modest."
His analysis of the impact of the proposals suggests the commission's latest plans would hit Germany hardest because of the number of very large farms in the former Eastern Germany where agriculture was collectivized under Communist rule.
Thurston said that 5,310 German farms would be affected - 1.6 percent of the total - and total subsidies would be cut by €270 million, or 5.4 percent. Other countries that would be affected include Britain, with 6,100 farms affected and savings of €78.5 million, and Italy, where 2,290 farms would lose out at a saving of €62.5 million.
EU agriculture subsidies amount to €55 billion out of a total EU budget this year of €116 billion.
About 80 percent of farm aid goes to a quarter of EU farmers on large holdings, according to the commission.
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