2 June 1931

Modulation French flop

as Britain goes it alone

By Philip Clarke

and Jonathan Riley

BRITAIN is now the only EU country diverting food production support to farmers who look after the countryside after France suspended its own modulation programme branding it a total failure.

In a move that prompted concerns over the UKs ability to compete with its neighbours, the newly appointed French farm minister Herve Gaymard announced that diverting direct aids to fund environmental schemes had failed.

Although about k215m (£129m) had been collected, the funds had remained unused, partly because the previous French government had failed to come up with any projects that satisfied Brussels, said Mr Gaymard in a statement.

"The criteria for modulation are also complicated and unclear. Farmers consider them unfair as, based on the same income, some are affected, while others are not."

The common sense solution, therefore, was to suspend the policy, he concluded.

NFU deputy president Tim Bennett echoed Mr Gaymards view that modulation was not working. Other countries were sending out a clear message, he said.

"Portugal dropped modulation earlier this year, Germany is going ahead next year but has scaled back plans to modulate and now the French have suspended their programme. Surely this highlights to our government that modulation in its present form does not work.

"Under the UK regime anyone receiving direct support payments contributes 3% towards modulation. But the majority of environmental schemes, that the money funds, are only applicable to grass-based producers so only about 14% of farmers can benefit. The rest of the farmers and the environment lose," said Mr Bennett, who called for a rethink on modulation before Britains competitiveness was reduced.

Economic suicide

That prospect was first mooted earlier this year when Tory MP and former farm minister Gillian Shephard predicted that the UK could be left alone in pursuing modulation. Mrs Shephard suggested that would be "economic suicide" for Britains agricultural community.

Farming and food policy commission chairman Donald Curry said the government should take note of the French situation.

Britains modulation policy was different from the French one but we shared a common problem in that the environmental schemes to distribute modulated cash were too few and too bureaucratic, said Sir Donald.

"Unless the Treasury invests enough money to rationalise and create schemes to redistribute funds cost-effectively then Britain will indeed be at a competitive disadvantage with its neighbours and the world," he said.

Meanwhile in France the main French farming union, the FNSEA, applauded its governments decision as a positive response to the organisations demands.

"Since it started, the mechanism has combined heavy bureaucracy and inequality, diminishing support from already cash-strapped farmers," said a union spokesman.

But EU farm commissioner Franz Fischler suggested that Frances decision to suspend modulation would not deter him from trying to make the policy compulsory EU-wide. He believed that Mr Gaymards objection was more to do with the way it was implemented in France. &#42

"He did not say he was opposed to all forms of modulation." &#42