Farmer compensation deal ‘a poisoned chalice’

Plans to compensate farmers who face losing billions of euros thanks to European trade agreements have been dubbed a poisoned chalice which should be rejected.

Proposals by the European Commission said farmers hit by falling prices because of trade deals such as the Mercosur agreement with Latin American countries would not be compensated by increased direct payments through the Common Agricultural Policy.

Instead they would be offered one-off assistance to help restructure their business or to find another job.

They would also be forced to compete for funding from the European Globalisation Fund with workers who have been made redundant by factory closures.

But George Lyon, Liberal Democrat MEP, slammed the plans and said it would give the Trade Commission “a blank cheque” for writing trade deals, no matter how bad they were for farmers.

He said the business assistance would do little to help farmers affected by deals such as the proposed Mercosur agreement, which will free up trade between countries such as Brazil and Paraguay but threaten to slash farm incomes across Europe.

Figures from EU farm experts DG Agri predict lossesto the entire farming sector at as much as 3.2% if Mercosur is agreed, with beef producers facing up to an 8% drop in income.

Mr Lyons said previous reforms which had led to a fall in prices for farmers had resulted in compensation through direct or single farm payments.

“Now the commission is proposing that beef farmers hit by trade deals such as Mercosur would no longer be compensated through the CAP,” he said during a debate in the European Agriculture Committee on Tuesday (24 January).

“The reality is that this funding which [European farm] Commissioner Ciolos claims is part of agriculture spending is nothing more than a political fig leaf to cover up the fact that the CAP has borne the brunt of the cuts proposed by the Commission.

“The other major concern is that if this proposal is agreed by the European Parliament it will give the Trade Commission a blank cheque when signing trade deals and it will signal a tacit acceptance of any future trade deal no matter how bad it is for farmers.

“The Agriculture Committee should reject this proposal from the Commission and insist that compensation for farmers hit by trade deals should in future continue to be compensated through the Common Agriculture Policy.”

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