§ Mr. HoyleTo ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on Common Agricultural Policy reform and help provided to poorer farmers under the policy. [153439]
§ Alun MichaelThe EU agreed on 26 June 2003 to a radical shift in the Common Agricultural Policy (CAP). In future, the bulk of subsidies will no longer be linked to production, freeing farmers to produce the safe, high quality food which people want and bringing environmental improvements.
On 12 February my right hon. Friend, the Secretary of State, announced how she proposed to implement key features of that groundbreaking reform in England. We will decouple fully in 2005 and move over an eight year 430W transition period towards a flat rate Single Farm Payment to farmers. England will be split into two regions—land in the severely disadvantaged areas (SDAs) of the less favoured areas (LFAs) and all other eligible land. Different rates will apply in these regions. This represents a decisive irreversible and forward-looking shift consistent with the direction that we have already set in the Sustainable Farming and Food Strategy (SFFS) and in the June 2003 CAP reform negotiations.
If farmers seize the market opportunities offered by these reforms, it is estimated that UK farm incomes could increase by around 5 per cent. relative to the 2003 Total Income from Farming, and farmers will be freed from some of the bureaucracy associated with the old subsidy schemes. For some of the poorer farms this change in support represents a chance to get off the treadmill of small scale and unprofitable commodity production.
There are also Defra led initiatives already available to help poorer farmers. These include the Farm Business Advice Service to help farmers adjust and respond to the difficult trading conditions of recent years and a number of benchmarking initiatives to help struggling farmers see how they can bring their performance up to the level of more successful businesses.