12 July 2002


Its not often we agree with DEFRA minister, Margaret Beckett. But shes right about one thing – the common agricultural policy needs urgent improvement.

Farm incomes are falling in most member states. In certain sectors surpluses continue to mount. Farmers are smothered in red tape. The Common Market is also a joke. Some member states gold-plate every Brussels rule while others ignore them. Consumers and taxpayers worry they are not getting value for money.

For these reasons alone, farm commissioner Franz Fischlers mid-term review of Agenda 2000 deserves thorough consideration. It contains a number of positives.

Decoupling aid payments from production could simplify the system of support, protect subsidies from attack in the World Trade Organisation talks and free farmers to produce for the market.

Cross-compliance also has much to recommend it. Farmers are happy to farm in environmentally friendly ways, provided the conditions are not too onerous, are enforced equally and do not entail more red tape.

But the review does contain threats that must be resisted. Capping is one. Even at the high level suggested by the commission, hundreds of UK farms would lose out on crucial support. But modulation is the biggest worry.

The commission plans to take up to 20% off aid cheques within six years and redirect the money to rural development. But, as the recent RICSs study demonstrates, even at a 10% rate of modulation, net farm incomes will drop by 22%.

Dr Fischlers wants to go further, taking the money from northern member states and redirecting it to areas with "special needs", such as Austria, Greece and Italy. He also plans to end the obligation for member states to match-fund modulated monies.

Few would deny that the current CAP is flawed but Mrs Beckett should do her utmost to ensure its replacement is not a good deal worse.