Flat-rate cuts for farm income fair
Flat-rate cuts for farm income fair
By Philip Clarke
CUTTING direct income aids by the same percentage for all farmers is seen as the fairest way of generating funds for agri-environment and rural development schemes.
Talking to farmers weekly this week, farm minister, Nick Brown, said the flat rate approach (announced last week) ensured that no one sector was penalised more than any other, while the whole of UK farming would benefit from the match-funding deal agreed with the Treasury.
To have achieved the same budget – £1.6bn over the next seven years – while exempting smaller producers would have meant imposing a disproportionate cut on larger farmers and set a dangerous precedent with Brussels, he said.
"We argued strongly against the concept of ceilings in our negotiations on Agenda 2000 earlier this year. This continues that philosophy. We were also keen to avoid setting up something that could backfire on us later, if degressivity (of aid payments) reappears. That would be a massive own goal."
Mr Brown said he was also concerned that if aid cuts had been targeted at the largest producers, those farmers would simply restructure themselves so as to avoid the cut-off points.
Putting more money into environmental and rural development areas was in tune with de-coupling support from production, he added, making agricultural policy more acceptable to the public.
But there was no scope for using any of the cash for an early retirement scheme. "We explored this very closely, but it was impossible to come up with anything that represented good value for money." There was a huge "deadweight cost", he said, from those who were going to retire anyway.
And given the limited funds available, they would have had to be targeted at individual sectors – be it livestock, dairy, pigs or less favoured areas – creating instant inequities.
As for new entrants, Mr Brown said he had instructed those who would be drawing up the rules for rural development, training and marketing, to do so in a way that was sympathetic to young farmers.