NFU Cymru calls for period of stability in cap health check response

Fundamental and radical changes in the direction of the Common Agricultural Policy (CAP) should be ruled out according to NFU Cymru's response to the Welsh Assembly Government's consultation on the European Union's CAP health check. The Union is calling for a period of stability for Welsh farmers to have time to manage their businesses following the recent financial and managerial difficulties imposed on them with both Foot and Mouth Disease and the BlueTongue virus.

Dai Davies, NFU Cymru President said, "We see the 2008 CAP health check as a process of adjustment rather than fundamental reappraisal and reform and we hope that the Welsh Assembly Government resists pressures for fundamental change ahead of the more radical reforms anticipated in 2013."

In its response to the consultation NFU Cymru has defended Wales' historic model for Single Farm Payments (SFP). The Union has said it was always its understanding that the current historic approach would prevail until 2013 though fundamental change was likely thereafter. NFU Cymru cannot see that there would be benefits for Wales in moving to a flatter rate system.

Mr Davies said, "In defence of the historic approach we would point to the fact that Single Payment Scheme (SPS) allocations in their totality to Member States and to devolved administrations have and will until 2013 continue to be based on historical calculations as indeed are Rural Development budgetary allocations.

"Advocates of an area based system frequently argue that a move to such a system would ease transition to the post 2013 policy framework but NFU Cymru would contend that without knowing the precise policy direction or the budget post 2013 it is, at this stage, premature to be second guessing what transition might look like."

NFU Cymru regards a commensurate reduction in domestic voluntary modulation as a prerequisite to any increase in the level of compulsory modulation at an EU level.

In response to the Assembly's question as to the implications of capping SPS, NFU Cymru said the likelihood is that decisions would be taken to artificially split businesses which would likely be counter-productive to the very business efficiency that the Assembly is endeavouring to drive through Farming Connect. The costs of administering any capping system would, in NFU Cymru's view, also be totally disproportionate to the funds that might be generated simply for redistribution within Wales.

NFU Cymru has welcomed the EC's decision aimed at technically simplifying the SPS, including the decision to drop the 10 month rule. There is recognition amongst farmers that cross-compliance is an integral part of the SPS but the perception is one of 'gold-plating' EU requirements.

Mr Davies said, "The overriding experience of farmers in Wales of CAP cross-compliance measures has been one of increasingly intrusive on-farm inspections, changing and increasing cross-compliance standards and widespread anxiety that they may be inadvertedly compromising their SFP. NFU Cymru believes in the context of the CAP health check the EC should ensure consistent application of existing compliance rules and inspection regimes and on identifying opportunities should simplify the now huge administrative burdens both for farm businesses and inspecting authorities alike."

In relation to the funding of the Welsh Rural Development Plan (RDP) NFU Cymru raises a fundamental and critical issue that the UK's and thus Wales' share of Pillar 2 spending is, on any measure, significantly below the average for other Member States.

The issue of the distribution of the EU's Rural Development budget has to be addressed and it is essential that at the next budgetary review a more objective and equitable basis for the allocation of core funding for Pillar 2 is determined otherwise Wales and other UK farmers are going to continue to be disadvantaged and competition will continue to be distorted by the imposition of additional modulation at the domestic level to make good inadequate EU funding.

NFU Cymru now awaits the EC's draft legislative proposals.