Pause for thought................. Can large amounts of taxpayers money be justifiably be allocated to an industry that employs 1.8% of the population and contributes less than 9% to Britain's Gross Domestic Product (including merchants, wholesalers, manufacturers and food processors)?
Pause for thought... List 2 other mechanisms which could possibly be used to allocate support to farmers which would provide a distribution of monies more in line with the aims of the EU.
Pause for thought......should agriculture be supported at all? What is the difference between a family farm and a family owned shop that has to compete with the supermarkets?
Pause for thought........ Can you think of examples in other industries in the UK where owners of a resource are paid either not to use the resource, or to manage it in a specific manner?
Read following article by Ashok Sharma in FINANCIAL EXPRESS...
Link for article....
http://www.financialexpress.com/fe_full_story.php?content_id=99333
EU farm subsidies help only rich farmers, firms
ASHOK B SHARMA
Posted online: Monday, August 15, 2005 at 0017 hours IST
The European Commission has been fighting shy whenever the issue of farm subsidies is discussed at the WTO. It has been defensive on the issue of subsidies and offensive on gaining market access in the Third World.
A deliberately designed farm support system in the European Union has helped it emerge from a net food importer to a major player in the export market, particularly in the period 1975-88.
The escalated level of farm subsidies became legitimised with the formation of the WTO.
But who does the European Union seek to protect through heavy farm subsidies? It is certainly not the small and marginal farmers.
European subsidies are applied more to industry products than farmers’ produce. For instance, there is more support for butter, skimmed milk powder and cheese of the dairy industry and less for milk.
Export subsidies benefit the food industry and traders, the farmers get little. In the EU, 80% of subsidies are paid to only 20% farmers, most of which are cornered by large farms owned by rich landlords and corporations.
Export subsidies were deliberately instituted to dump the European products in the Third World.
European export subsidies amounted to $8-12 billion in the period 1988-94. Europe, today, is a major exporter of dairy products.
The Court of Auditors, in its special report no 9/2003 regarding the system for setting the rates of export subsidy and export refunds, notes "for significant periods covered by the audit, the Commission’s estimates show that the EU price net of refund is below the world price for certain milk products."
The European price, after deducting refunds, was found lower than the world price, indicating substantial gains for the dairy industry.
At the same time the dairy farmers did not receive any subsidy under the old Common Agriculture Policy, the report of the Court of Auditors indicates.
Another example of the miracle of European subsidies is sugar exports. The EU, today, with its exports of about 5 million tonne of sugar per year, is second to Brazil in marketshare.
Despite the high domestic price of sugar, the EU has been able to export through a combination of direct export subsidies and cross-subsidisation of exported sugar through a production levy paid by farmers. The European consumers suffer on account of high domestic prices.
The major beneficiaries of export subsidies are the corporate houses like Beghin Say, Sudzucker, Tate & Lyle, RT, Danisco and Nordzucker.
Supermarket chains also reap benefits at the cost of farmers. Reports of the UK’s Competition Commission clearly shows that large supermarket chains procure farmers’ produce at relatively cheaper rates and reap huge profits.
For long, European subsidies were shrouded in mystery. It was only in June 2004, that Denmark set an example by making public the beneficiaries of subsidies.
In 2003, out of the total DKK 10 billion subsidy, the leading dairy processor, Arla Foods, cornered DKK 1.3 billion, Danish Crown had DKK 119.6 million (174,658,761 Euro) of the share and the Danish Institute of Agricultural Sciences had DKK 111.1 million.
Arla Foods got an export subsidy of DKK 1 billion and products-in-production subsidy of DKK 286 million. In 2003 the Danish Agricultural Centre for Advisory Services received DKK 29.9 million and its Board members, including Peter Gaemelke, Henrik Hoegh and chairman Gert Karkov together received subsidies totalling DKK 8.9 million.
A number of members of the Danish Parliament and spouses of ministers were among the beneficiaries.
The Freedom of Information Act compelled the UK to disclose the beneficiaries of subsidies.
The country’s leading sugar company, Tate and Lyle, received the largest payment, more than pound 233,000,000 in export subsidies over the two-year period.
Other major beneficiaries were Meadow Foods, C Czarnikow Sugar, Granox Ltd, Cooperative Centrale Raiffeisen Bank, Philpot Dairy Products, Fayrefield Foods Ireland Ltd, Lisburn Proteins and Nestle UK Ltd.
According to estimates, seven farmers belonging to the nobility class and cattle-breeders received 5,700 Euros per farm per day or 240 Euros per farm per hour in Spain. Agro-industrial firms eg vine sector are also major beneficiaries.
In Denmark, too, the nobility class are major beneficiaries. Prince Joakim received subsidies worth DKK 1.4 million for maintenance of his Schackenborg estate in South Jutland. Similarly, in the UK the Queen received £769,000, Prince Charles received £300,000 in 2003-04.
Instances are clear. European subsidies protect only the agri-business corporations, large and rich farmers and the nobility class at the cost of small and marginal farmers and consumers.
The hefty European subsidies also depress global prices seriously, placing the farmers in the Third World at a competitive disadvantage.
Conscious awakening has dawned in Europe in relation to the unjust subsidies.
Another article from The Press and Journal....
Link.....
http://www.pressandjournal.co.uk/di...uleName=InternalSearch&formname=sidebarsearch
TAXPAYERS MILKED FOR £1M BY A DAIRY FARM
JOE WATSON
FARMING EDITOR
08:50 - 03 March 2007
A Scottish dairy farmer has exploited a glaring loophole in European law to annually earn the right to claim more than £1million in subsidies.
William Hamilton and Sons, of Meldrum Farm, Blairdrummond, Stirling, has taken advantage of a flaw that allows it to get handouts on almost nine times the amount of milk it produces.
Under EU law, the business will continue to qualify for the lottery-size payment annually until 2012 - even if it stops producing milk.
There was political uproar last night after the Press and Journal used the Freedom of Information Act to expose the £1,097,821.78 that is legally being paid to William Hamilton and Sons.
Liberal Democrat deputy rural affairs spokesman Andrew Arbuckle branded it an abuse of the system.
SNP MSP for Moray Richard Lochhead, the party's rural affairs spokesman, added: "The EU paymasters are bonkers if they think this system can be justified and sustained."
Disclosure of the payment and the £37.257million being paid in compensation to 1,512 Scottish dairy farmers comes as the industry bemoans ex-farm milk prices that in many cases are below the cost of production and are forcing three UK dairy farmers a day to quit.
The compensation was introduced by the European Commission in 2004 to make good compulsory price cuts to a range of dairy products over which Europe regulates the price.
But rather than tie the subsidy to the amount of milk a farmer produced - as was demanded by the dairy sector - civil servants and Eurocrats decided instead to allow subsidies to be paid on the milk production quota that farming businesses held on March 31, 2004.
That led to fevered quota buying in the run-up to the date as farmers saw the error that could earn them extra cash.
The P &J understands the Hamiltons started 2004 with the right to produce about 5million litres of milk but by the end of March had 44.1million litres - nine times what their 500-cow dairy herd would be expected to produce.
Bill Hamilton last night declined to comment, saying they had not yet received the cash. Last year the business received £766,394.04 when compensation payments were lower.
The Scottish Executive said the claim from the Hamiltons was legitimate.
In nutshell.......Just cut this Subsidies like US has offered to do if EU does it.....To be fair to the rest of the world.....
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