One proposal in the Commission’s health check communication of 20 November 2007 is that the member states which still allocate farm subsidies on the basis of historic entitlements should move to the area average system in which allocations are the same across all hectares in a given geographical region. But it looks as though this change will be optional, according to a speech made by Commissioner Fischer Boel in Ireland on 29 January. Moreover, the flat rate system does nothing to address the striking inequalities between member states, which shows that on average, Dutch farmers get €1299 per hectare, while Portuguese farmers get just €88.
Expressing her own preference for regional average payments, she said that it would be up to member states to choose for themselves:
“As you know, there’s a section in the Health Check communication about flattening out the single farm payments that different farmers receive – in other words, reducing the differences between these payments. And I know that this has set a few alarm bells ringing in Ireland. Let me reassure you: this section of the Health Check is nothing to worry about. If you still want the ‘historical’ model of the Single Payment Scheme, you can still have the historical model.”
In the historic entitlement system, a farmer’s entitlements depend on the value of subsidies paid in the reference period, which is the average of 2000-2002. This can lead to striking differences between farms that are growing exactly the same crops or raising the same livestock because they are were different back in the reference period. Fischer Boel said she thought this was increasingly hard to justify:
“I think that, in the years to come, the public will find it hard to understand why Farmer X is paid more each year than Farmer Y just because of production decisions that he took 10 years earlier – or perhaps, because of decisions taken by his predecessor!”
It should be stressed that none of this would have any bearing on the huge differences in entitlements between member states. Calculations based on Commission figures on direct payments and agricultural area in 2006 are illustrative of the huge disparities. And they call it a common agricultural policy?