The row over a proposed £12m cut in the budget for Welsh farmers’ less favoured area payments in 2007 is rumbling on.

A majority of members of the Welsh Assembly’s environment planning and countryside committee have rejected the idea of reducing by one third the Tir Mynydd scheme payments that replaced hill livestock compensatory allowances.

Glyn Davies, the committee’s chairman, said members could see no reason whatsoever for slashing the Tir Mynydd budget.

He rejected claims by rural affairs minister Carwyn Jones that the move was linked with opposition forced changes to the Assembly’s overall budget, and to improved hill farm incomes.

“Something of a funding fog has descended on the environment, planning and countryside budget,” Mr Davies claimed.

Elin Jones, Plaid Cymru’s shadow countryside minister, said Mr Jones had misled farmers and farming unions by suggesting that last autumn’s budget discussions led to the planned cut in support payments.

“He is obviously trying to deflect the blame onto Plaid, but the figures show that this is no more than New Labour spin” insisted Ms Jones.

The Welsh assembly government had reserves of over £100m, which was more than enough to fund areas of much needed investment and maintaining help for agriculture.

“In a period of falling farm incomes this is not the time for Carwyn Jones to be punishing farmers.”

Both Welsh farming unions said this week that they would leave no stone unturned in their endeavours to get the Tir Mynydd budget returned to its previous level.

“We are totally committed to this cause,” said John Owen, chair of NFU Cymru’s less favoured area board.

Arwyn Owen, Farmers Union of Wales policy director, said the minister was isolated.

“These payments are essential for the maintenance of farming in the uplands, and environmental bodies recognise their role in maintaining natural habitats,” Mr Owen said. “We will do all we can to marshal opposition before the plan comes before the Assembly in the autumn.”