MPs publish report on EU Common Agricultural Policy reform

15 April 2011

In its latest report on the Common Agricultural Policy (CAP) after 2013 the Environment, Food and Rural Affairs (EFRA) Committee slams the European Commission's proposed sweeping reforms of the CAP that would see the current complex and bureaucratic system of direct payments replaced by one that could be even worse.

The EU wants to slap farmers with more regulation rather than provide the incentives to secure a sustainable and profitable EU agricultural sector, say MPs.

These changes include a new tier of environmental conditions, with penalties for farm businesses that do not comply or fail to meet new criteria for 'active' farmers, farm size and number of employees.

Launching a report reviewing the options proposed by the European Commission for reform of the Common Agricultural Policy, Anne McIntosh MP, EFRA Committee Chair said,

"Farmers are seeing their incomes fall while hard-pressed families have to swallow rising food prices. Neither the EU nor DEFRA have faced up to these twin challenges."

Key principles

In its report the EFRA committee sets out the key principles the UK government should promote and the elements. The Department for Food and Rural Affairs (DEFRA) must secure in its negotiations for reform of the CAP after 2013.

The first objective of the CAP should be to maintain and enhance the EU's capacity to produce food with a significant degree of self sufficiency and, in the long term, less reliance on income support from the tax payer.

Future food security

The UK's future food security is threatened by the low profitability of its agriculture. More than half of UK farm businesses would be unprofitable without the support they receive through the CAP; for example livestock production in the uplands. DEFRA believes direct payments should be phased out.

The committee concludes that direct payments have a place within the CAP, at least until 2020, and for as long as business conditions in agriculture fail to deliver a thriving and profitable industry.

Anne McIntosh said

"While we broadly support the government's desire to reduce reliance on subsidies, we do not believe that cuts to direct payments are the best way to achieve this.

Ministers need to set out exactly how UK farmers will become self-supporting, against a backdrop of rising fuel, fertiliser and feed prices and in the face of greater competition from third countries that do not operate to EU standards of environmental protection or animal welfare,"

The MPs urge the Coalition Government to clarify its food security strategy, taking into account the recommendations of the Foresight Food and Farming Futures report and its position on CAP reform.

The CAP must deliver a competitive and viable agricultural sector that produces safe and high quality food with a lower environmental impact.

The committee backs the Foresight report's call for 'sustainable intensification' of agriculture and calls on the European Commission to find ways to mainstream environmental sustainability alongside successful and productive farming. Anne McIntosh adds,

"A future CAP should place greater emphasis on sustainable farming, but it should do so through a system of incentives and not through additional regulation. The EU proposal for more mandatory environmental measures will make the CAP more complex without delivering tangible benefits. We support DEFRA's view that it makes most sense to strengthen and expand the agri-environment component of Pillar 2, but it is paramount that every European farmer faces the same requirements."

The EU has high standards of animal welfare and environmental protection, but these do not apply globally and can therefore undermine European producers. Anne McIntosh says,

"When consumers buy cheap food imports produced to lower standards, the EU is effectively exporting the adverse environmental impacts. The CAP pays for the more exacting standards of welfare and environmental protection that consumers demand. This is not sustainable in the long term."

To address this problem the committee concludes that the UK should press for the EU to argue more strongly for recognition of environmental and animal welfare production standards within trade agreements.

The committee also warns that the EU proposal for a multi-tiered single farm payment will require expensive new computer systems and auditing.

"DEFRA should resist more complicated CAP administration. Given the ongoing debacle at the Rural Payments Agency, the Government must not waste any more public money on such activities," said Anne McIntosh.

Negotiating position

Lastly, while reform of the EU's agricultural policy is proceeding rapidly, the committee warns DEFRA that it still does not have a coherent and effective negotiating position for CAP reform.

"Ministerial discussions with the devolved administrations have been dogged by disagreements so we remain less than convinced DEFRA will succeed in establishing a united UK position. Were it to fail to adequately represent the diversity of UK agriculture, this would weaken both the credibility and effectiveness of our negotiating position.

Likewise, if the UK Government wants to influence the direction of negotiations it will need friends and allies across Europe. With that in mind it is breathtaking that DEFRA also failed to agree the collective position adopted recently by the EU Council of Agricultural Ministers," says Anne McIntosh.

Further Information

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