Landowners to Lose Out in EU Modernisation

BIG landowners, including the Queen, will be the losers under plans for the modernisation of European agriculture policy, it was claimed yesterday.

Last night, there was confusion over how much they would lose. But it did seem clear that poorer farmers would not see the money because any increased rake-off from individual farm cheques is likely to be spent on manure-powered generators and other schemes for tackling climate change and water pollution.

The proposals emerging from the Common Agricultural Policy (CAP) Health Check – a mid-term review of the reforms introduced in 2005 – were still emerging last night.

But early indications from the European Union were that the main theme was to take from the rich. It is believed there will be a ceiling on Single Farm Payments – in effect, a penalty on big farms – which would cut the Queen’s grant for Sandringham in half.

It is possible something like that will be in the next round of negotiations. It is also possible that British Ministers have an eye on a new rule which would let them cut grants to farms which are part of bigger businesses. But officials insist nothing like it is on the cards yet.

However, the EU is proposing an income-tax-style banding system for “modulation” – the top-slicing of farm grants to create central funds for rural development.

The intention is to increase compulsory modulation, across the EU, to even out what individual governments do voluntarily, and to put the money into “programmes in the fields of climate change, renewable energy, water management and biodiversity”.

England would be expected to cut its take from farmers in line with its new allocation from the EU. But that applies to total amounts. The EU plan is to take less off the smallest grants and more off the biggest.

With four different national systems established in Britain alone, it will take months of argument to sort out how all this will work. But it will hit the likes of the Queen, the Duke of Westminster and the Duke of Devonshire – although not nearly as hard as the rumoured ceiling proposal.

It will also hit companies like Warter Priory Farms, which runs a lot of acreage in Yorkshire and Lincolnshire. None of their estate managers wanted to comment.

But the Country Land and Business Association, which includes landed gentry, said it fought against a banding system. Its Yorkshire director, Dorothy Fairburn, said: “These are not subsidies. They are payments for farming in a certain way, because we want people to farm in that way, whether on 100 acres or 1,000. I see a danger that people will come out of the system and farm intensively instead.”

The National Farmers Union is happier about the modulation reforms, because they will gradually level out a system under which the English farmer currently loses most.

However, the union is concerned about proposed relaxation of a rule which allows governments to take another 10 per cent off farmers, on top of modulation, for suitable schemes, like disaster insurance. And everyone is concerned about the amount of important detail which still needs to be hammered out.

A spokesman for the Royal Association of British Dairy Farmers said they agreed with removing limits on milk production – gradually, until the end of 2013 – but were nervous about the lack of precaution against subsidised surpluses. He said: “We are not arguing about the big picture. It’s how we get there.”

The reforms move farming away from intervention and towards free enterprise in a world market, subject to environmental controls. That is in line with Government thinking.

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