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Brussels keen to limit EU payments to large farmers

  • Europe's farmers have also been hit by the global economic downturn (Photo: Rossen Kalpachki, Trud Daily, Bulgaria)

The European Commission has indicated its willingness to limit payments to some of Europe's largest farmers under upcoming reforms to the bloc's common agricultural policy (CAP), a move that could prove controversial in a number of member states.

Launching a public debate on Monday (12 April) on the future shape of the CAP, EU agriculture commissioner Dacian Ciolos said he was willing to take a fresh look at the subject, two years after national governments rejected a similar proposal.

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"I will be addressing this problem as part of the debate [on CAP reform] and it's something I will put to the council [representing member states] and the European Parliament in due course," Mr Ciolos told journalists in Brussels.

The Romanian politician signaled the move would come as part of wider overhaul of the EU's system of direct payment to farmers, with any changes set to kick in from 2014 onwards, once the union's current budgetary period (2007-2013) comes to an end.

The future shape of Europe's expensive agricultural policy has already provoked heated debate across the union.

CAP payments amount to approximately €55 billion a year, more than 40 percent of EU's entire annual budget or around €100 a year for each EU citizen, says the agricultural watchdog organisation Farm Subsidy.

While many small-scale farmers rely on the EU funding just to survive, revelations that some large-scale commercial businesses receive annual payments of over €500,000 caused a public outcry last year when details were published on the internet for the first time.

But a commission proposal in late 2007 to limit farm payments to a maximum of €300,000 was not supported by a majority of EU member states, with countries containing large farms such as the UK and Germany raising concerns. A number of smaller restrictions were implemented however.

EU farming umbrella group COPA says it is against any limitations on EU direct aid to farmers, irrespective of farm size. "If farmers deliver public goods [such as land stewardship], then their payments should be proportional," the organisation's secretary general Pekka Pesonen told EUobsever.

"A payment cap would discourage farmers from increasing the size of their farms, distorting competition and limiting the willingness of farmers to make investments," Mr Pesonen added.

Timetable

The commission hopes to receive submission's from a wide array of societal groups and individuals in response to its launch of the public debate on the future role of the CAP.

The EU executive says these suggestions will then feed into a communication on CAP reform towards the end of this year, with legislative proposals set to come forward in 2011.

"We must strengthen the links between farming and consumers' expectations. Strengthen the links between farm production and local, regional and international markets," Mr Ciolos told MEPs later on Monday.

Countries with strong farming traditions have typically supported the EU's interventionist policy, with French agriculture minister Bruno Le Maire recently signaling his country's intentions to oppose any major reform that could hurt French farmers.

Victory for the UK's Conservative party this May, and a change of government in the Netherlands following June elections could have important implications for the EU's 2014-2020 budget, and subsequently also for the CAP.

Last week the Dutch liberal VVD party signaled it supported cutting the country's EU payments by almost half.

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