10-12-2013 11:02 AM | Finance, News

Farmers 'infuriated' with Government modulation plans

Farmers 'infuriated' with Government modulation plans
Despite the pledge by the Secretary of State that he would only transfer the maximum 15 per cent from Pillar 1 to Pillar 2 if he demonstrated it would deliver “worthwhile and valuable outcomes…” farmers are increasingly infuriated and remain at a complete loss to understand Government’s intentions for spending modulated funds.

Defra Ministers are understood to have made a recommendation to Cabinet colleagues on the scale of modulation or “inter-pillar” transfers that are to be applied from SPS 2014 onwards. This is so that the Government’s decision can be communicated to the European Commission by the end of the month.

Despite the possibility to review the rate upwards in 2017, it is believed that Ministers have recommended the maximum amount to be deducted from farm payments ahead of then, rendering the opportunity for a proper assessment based on what rate is needed and the demand for future schemes redundant.

NFU President Peter Kendall said: “The NFU has used the Government’s own figures contained in the recent consultation to build the case for retaining the rate at nine per cent. At the same time Defra has totally failed to set out its vision for making effective use of rural development money in the future.

“There has been no attempt to explain to farmers how increasing the transfer rate beyond nine per cent will deliver “worthwhile and valuable outcomes” for their businesses. Farmers remain at a complete loss to understand what Government intends to use this money on, or how it can be used effectively for the benefit of their businesses.

“Farmers understand the need for environmental protection and management. Much of the good work undertaken by farmers through their Entry Level Scheme (ELS) agreements will form the basis for the new environmental conditions known as greening. We know that Government is designing the replacement to the ELS along the lines of a more targeted and competitive scheme which aspires to have half the area of land in England currently in a scheme supported in the future.

“The threat of disproportionate reductions in farmers’ payments vis a vis their immediate competitors is making them angry and frustrated with this Government. The Scottish Government recently announced that it intends to modulate at 9.5per cent, while the German Government has gone for 4.5 per cent - well below the maximum of 15 per cent that Defra appears wedded to.

“It is profoundly disappointing and infuriating that this Government appears committed to increasing the modulation rate with no idea of how the money will be spent. Ministers have totally failed to deliver on their pledge to farmers that such a decision would deliver worthwhile and valuable outcomes. Instead they are operating on a wing and prayer, seemingly determined to plough ahead, disregarding the opportunity for reviewing the rate upwards in the future once we know how much of the ELS is to be retained by greening, how much demand there will be for the new competitive agri-environment scheme that will replace the current broad and shallow schemes and how capable the Local Enterprise Partnerships will be at delivering worthwhile schemes in rural areas.

“I urge MPs and Ministers to work with us to find a solution to this deeply frustrating and disappointing situation.”


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