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EDITIONS
Wednesday, 10 July, 2002, 17:24 GMT 18:24 UK
Farmers' fears over EU subsidies
Farmer and cattle
The emphasis will move from quantity to quality
Scottish farmers have attacked plans to reform European Union agricultural subsidies.

They said planned changes to the Common Agricultural Policy (CAP) could lead to subsidy cuts of up to 20%.

The National Farmers' Union of Scotland (NFUS) said the cuts, which would take six years to take full effect, would tax Scottish farmers and benefit small-scale farm operations on mainland Europe.

Ross Finnie reading
Mr Finnie is setting up an industry group
The Scottish National Party also warned of "massive and unsustainable" reductions in farmers' incomes.

The plan to gradually "modulate" or reduce direct subsidy payments was a controversial element of the reforms announced by EU Agriculture Commissioner Franz Fischler.

The commissioner said the EU must grant subsidies on the basis of quality rather than quantity, with aid more conditional on environmental, food safety and animal welfare considerations.

Spanish farmers protested on the streets of Brussels as he unveiled the proposals for reform intended to modernise the CAP ahead of the arrival of 10 new EU member states.

The current "blank cheque" approach to subsidies, in which payments are based on output, would end.

Instead, individual production-related subsidies cheques to individual farmers would be replaced by one single cheque with 20% deducted to go into a fund for rural and "green" development.

'Well-deserved reputation'

Rural Development Minister Ross Finnie gave a cautious overall welcome to the Brussels package and said the reforms went in the right direction.

He plans to set up an industry group consisting of farmers, landowners, crofters and other rural and farming organisations to study the proposals as detailed negotiations begin.

Mr Finnie said: "I welcome the suggestion that subsidy payments should be linked to EU-wide environmental, food safety and animal welfare standards.

"This should hold no fears for the Scottish industry since it has such a well-deserved reputation for quality."


Whilst no farmers want to be dependent on subsidies, these changes will mean that the few will benefit at the expense of the many

Fergus Ewing, SNP MSP
However, he added: "Some aspects of the proposals will need careful watching where the detailed ideas may disadvantage Scottish farming.

"For example, the detail of the modulation proposals and those of the decoupled payment arrangements will only become clearer as discussions on the proposals progress."

The NFUS said reform was needed but attacked the modulation proposals.

"There is a real danger we could see Scottish farmers being taxed and farmers in other countries potentially getting the benefit," said NFUS president Jim Walker.

"With average farm income in Scotland last year at around 6,000, Scottish farming cannot afford such a cut."

Jim Walker
Jim Walker raised concerns of farmers
The union also attacked plans for modulation to apply only to payments above 3,200 and for payments to be capped at 192,000.

Both measures would hit Scotland because of the country's bigger farm sizes, it said.

However, Mr Walker welcomed the bid to break the link between subsidy and production.

Environmental group WWW Scotland welcomed the package as a "golden opportunity" to benefit consumers, the environment and most farmers.

It said three quarters of Scotland's farmers would not lose out.

The SNP called on the Scottish Executive to "defend" Scotland's farmers and oppose the changes.

Rural affairs spokesman Fergus Ewing said Labour ministers would take Scotland "down the road to agrarian ruin".

"These changes will lead to massive and unsustainable reductions in income, with only vague, ill thought-out and unconvincing promises made in return," he said.

"Whilst no farmers want to be dependent on subsidies, these changes will mean that the few will benefit at the expense of the many."

See also:

10 Jul 02 | Europe
26 Jun 02 | Europe
30 Apr 01 | Euro-glossary
10 Jun 02 | Europe
26 Jun 01 | Scotland
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