Leaks confirm Commission plans to cap Single Payments

Under the plan, the amount siphoned off will increase as payments get higher, starting with 10 per cent taken from payments over 100,000 euros. Payments of over 300,000 euros would be subject to cuts of 45 per cent.

The plan, part of the Commission’s Common Agricultural Policy Health Check, will be controversial in the UK, as its farms are, on average, some of the biggest in the EU, and would be among the hardest hit.

The Commission also wants to introduce a uniform area-based system for calculating Single Payments, which would impact heavily on Scotland and Wales, and increase compulsory modulation levels from 5 per cent to 13 per cent.

The full package of proposals, now widely circulating in Brussels, will be formally published on in late November, as the basis of the CAP Health Check negotaions.

Some of the leaked draft package include:

• From 2009 to 2013 the Single Farm Payment will be offered solely on a standardised regional basis. This means making adjustments so that payments are based on farm size (by area) and not on historical receipts.

• Cross compliance measures making payment of Single Payments conditional on cross compliance and animal welfare rules are to be better targeted.

• From 2009 there are likely to be cuts in Single Payments to keep Pillar One CAP spending within budget.

• All remaining coupled aid payments in the arable sector will be abolished to enhance the drive towards a fully decoupled CAP. This affects mainly France and Spain which have retained a 25 per cent coupled arable payment.

• Some headage based support for LFA suckler cows could be introduced in problem areas. Payments would be made to enhance environmental and rural structures through the continued presence of hill cows using special funds directed through the Rural Development Programme.

• Payments for the largest farms would be capped with farm payments above 100,000 euros cut by 10 per cent, those over 200,000 euros cut by 25 per cent and those over 300,000 euros cut by 45 per cent.

• Money saved by this measure will stay with the member state and be channelled into the RDP – where some may be used for special hill suckler cow payments.

• The current 0.3ha threshold for receiving payments is likely to be lifted to cuts costs.

• Compulsory modulation will increase from its current five per cent to 13 per cent by 2013 to boost spending on rural development.

• Set-aside, currently 10 per cent of cereal land, is expected to be permanently abolished.

• There may be measures help dairy farmers in the transition period leading up to the abolishment of milk quota by the end of March 2015.

• Intervention market support will be revised, along with export refunds, which are to be phased out completely by 2013.

• The E45 per hectare bio fuel support payment will be removed.

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