Sugar beet growers will see their compensation for price cuts reduced over time to a single flat rate area payment, DEFRA secretary Margaret Beckett has suggested.
Addressing the NFU’s annual conference, Mrs Beckett said that the historic model, whereby all the compensation would be ring-fenced in the sugar sector, was neither legal nor practical.
“But Tim Bennett has convinced me that there is a case to at least examine a different rate of progression towards a single flat rate amount for sugar growers over the additional transitional 2007-2009 years.”
That suggests that the same “dynamic hybrid” system that applies to the single farm payment will be used, though the annual movement towards a flat rate area payment will be slower for sugar beet growers in the early years.
DEFRA launched a consultation on this issue on Monday (27 February) to gather stakeholders’ views.
The importance of retaining as much of the compensation within the sugar sector in the initial years as possible was stressed by NFU president Tim Bennett.
The reform package agreed by EU farm ministers last November had extended the transition period from two to four years – slowing the rate at which inefficient EU producers will exit the industry.
“As a result, growers face not only a big price cut, but a big, albeit temporary, quota cut this year.
“It is really vital for the future of our industry in this country that the compensation is concentrated in those crucial four years of transition.”