Common Agricultural Policy (Hansard, 23 March 1995)

§ Mr. Jack

A note entitled "The Cost of the Common Agricultural Policy to Taxpayers and Consumers", produced by my Department, was deposited in the Library of the House on 9 March. This gives estimates of the cost to UK consumers and taxpayers of all forms of agricultural support of £4.15 per person per week in 1993, the most recent year for which information is available. The equivalent figure for 1985 is estimated at £2.39 per person per week. Both estimates include national agricultural expenditures as well as transfers resulting from the operation of the CAP. These estimates are based on calculations of total transfers resulting from agricultural policies in the European Union, made by the Organisation for Economic Co-operation and Development. Comparable figures for 1975 are not available. The estimates are likely to overstate the savings which could be made by consumers and taxpayers if agricultural support policies were removed, because, in the absence of support, world prices would be higher than at present.

In 1965, the UK operated a system of deficiency payments. The cost to UK taxpayers of these and other measures was equivalent to £0.08 per person per week—or £0.82 per person per week in 1994 prices. In addition, there were a number of policies which had the effect of raising prices to consumers. It is not possible to quantify these costs, but it is likely that they were smaller in real terms than the present consumer costs of the CAP.