27 March 1998
Single currency could lose farmers £360m
By Shelley Wright
FEARS are growing that UK farmers could lose up to £360 million of EU support payments with the start of the single currency next year.
According to NFU policy director Ian Gardiner, the problems will be that the
current agrimonetary system, which freezes aid rates for cereals and livestock, will effectively end on December 31 this year. The freezing mechanism was worth £360m to UK producers this year.
From the New Year, with 11 member states entering the single currency, only the UK, Denmark, Sweden and Greece will be left outside.
NFU officials have been lobbying their Swedish and Danish counterparts to try
and get a common negotiating position to take to the EU Commission and other
member states on what arrangements should be made to adapt the agrimonetary system for those not involved in the single currency.
“Ideally, we need to secure the continuation of frozen rates, but, realistically, we are not hopeful of achieving that,” Mr Gardiner told NFU
The other option was to win agreement on transitional compensation. But the four countries together did not have enough power to block EU decisions so their position was weak, he said.
Ben Gill, NFU president, said there were some signs that the UK Government
understood the difficulties ahead for farmers and would try to negotiate
transitional relief. But he warned that getting agreement from the 11 other
member states would be tough.
“I dont want to be in the position of getting to the end of the year and
securing say £300m of transition aid only to have everyone say “Youve lost £60m”. What you must realise is that we are starting these negotiations from zero,” Mr Gill said.
He added that when he had raised the issue with EU farm commissioner Franz
Fischler recently, the response had been: “Well, of course if you joined (the
single currency) then you wouldnt have this problem.”
For this and other stories, see Farmers Weekly, 27 March-2 April, 1998