Crunch time for EU budget talks
European leaders and heads of state started gathering on Thursday (22 November) for two days of negotiations that could cut the overall EU budget for 2014-20 and lead to a significant reduction in farm support.
The latest proposals – tabled by European Council president Herman Van Rompuy, who is chairing the summit – call for a 5% reduction in direct payments to farmers and a 9% reduction in rural development funding, including agri-environment schemes.
NFU president Peter Kendall has acknowledged that farmers must accept their fair share of any cuts. But he has warned that an ongoing attempt by the UK government to transfer 20% of direct payments to the rural development fund would unfairly penalise British farmers.
DEFRA argues that the flexibility to transfer a percentage of money from the pot for direct payments to the rural development fund is vital if agri-environment schemes are to be maintained in the event of an overall cut.
But Mr Kendall said: “If the budget is reduced, it is only right that the conditions and costs imposed on farmers should also be checked. We need a reality check on what we demand from farmers. We need to help them become more competitive, not force them to be more inefficient.”
Other EU farm leaders have also warned against cuts, arguing that the EU agri-food sector employs some 40 million people and it is central to economic recovery. Proposals for cuts run counter to this, jeopardising food security and rural employment, said European farm body Copa.
“More and more farmers and agri co-operatives are going out of business, constrained by high production costs which are often not covered by market prices, poor weather conditions and extreme market volatility,” said Copa president Gerd Sonnleitner.
“Farmers in Europe also have to comply with high food safety and environmental standards which imports to the EU do not have to meet. Farmers’ incomes are half the average level of earnings in other sectors and food demand is on the increase.
“These latest proposals would result in huge cuts in direct payments to farmers of up to 30% in some countries which is totally unacceptable, and risks threatening food security and causing increased unemployment”.
Cogeca, which represents European agricultural co-operatives, said other countries – including the USA, China and Brazil – were investing strongly in their agricultural sector to maintain competitiveness. But EU farm spending had been falling continuously.
“This is not acceptable,” said Cogeca president Christian Pees.
“EU agricultural spending must be kept at current levels until 2020, to ensure farmers and their co-operatives can continue to provide secure, safe food supplies to 500 million consumers. We also need a speedy decision on the [EU budget] and the CAP.
“Farmers are currently delaying production and investment decisions because of uncertainty about the future CAP and if this continues it will have disastrous impact on employment in related sectors as well as market stability.”
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