Eurostat has just published its first estimates for real agricultural income per worker in 2009. For the EU27, the figure is down 12.2% on the 2008 figure, but with considerable variation across countries, from -35.6% in Hungary to +14.3% in the UK. While differences in commodity price trends and variations in commodity composition across countries will account for much of the variation, other factors include the further phasing in of direct payments (in the NMS) and currency fluctuations against the euro (important in explaining the UK trend).
Eurostat also publishes a comparison of trends since 2005. Choosing any one year as a base is always problematic, given the possibility that the base year is an untypical year. This is the case for Ireland, for example, where double payment of the direct payments in the transition to the SPS resulted in unusually high farm incomes in that year.
Overall, average real agricultural income per agricultural worker has more or less held constant over the last four years, with the 2009 index (base 2005 = 100) for EU27 standing at 98.3. Nonetheless, there is considerable variation around this average. The UK stands out with an index of 148.0. Bulgaria and Romania joined the EU at the same time, but the Bulgarian index stands at 136.9 while the Romanian figure is only 95.4. Germany is around the EU average at 100.8, but France fell behind at 88.7. However, the real laggards are Luxembourg (67.7), Ireland (67.9, noting that 2005 was an unusual year) and an astonishing 46.5 in the Commissioner’s own country, Denmark.
The poor income performance in 2009 is already being used as an argument why direct payments should not be reduced in the next financial perspective, even though it will not enter into force until 2014 by which time a lot can happen. But the wide national heterogeneity in income trends is a further argument that income support should be a national and not an EU competence.
