What will shape the future of farming in the European Union after 2013?
Speaking last night at a seminar in the European Parliament on the subject of "What will shape the future of farming in the European Union after 2013", Brian Pack, Chairman of the Inquiry into Future Support for Agriculture in Scotland explained the background and work to date completed by the Inquiry, emphasising the consultative nature of the process and the high levels of stakeholder involvement.
Brian spelt out the unique challenges faced by Scottish agriculture with eighty five percent of Scotland's area designated as LFA and sixty five percent of its agricultural area rough grazing with a resulting high dependence on ruminant livestock. He identified the importance of the ruminant livestock sector to the Scottish economy in terms of employment and Gross Value Added.
Pack highlighted the need for a vibrant European agricultural industry to help meet the global challenges of the security of food, water, energy, biodiversity and climate and deliver other public goods. He argued that if the agricultural industry was to play its full part, it had to be financially sound and, therefore, the future budget for the CAP had to be maintained at current levels and that direct payments were justified. Accepting that direct payments post 2013 would be area based, Pack said that the Inquiry had identified that, for Scotland with its predominance of rough grazing with widely varying productivity, the area base would have to have a link with activity even if this was on an historical basis. A simple area base could be used for the better land.
Whilst the Inquiry recognised that direct payments were justified, it would be in Europe's and Scotland's interests to improve the sustainability of the farming industry and a percentage of the direct payment - referred to as the Top Up Fund in the Interim Report - could be diverted to this end. With this fund being financed from the direct payment budget (Pillar 1), it should be able to be applied with a light touch re bureaucracy and should not be confused with Rural Development measures (Pillar 2).
Pack made the case that Scotland should be a special case as regards the percentage of subsidies allowed to be trade distorting, namely fifteen percent rather than three point five,. He said "the option of coupling subsidies where deemed essential - e.g. utilising rough grazing - was necessary to protect the vulnerable parts of the Scottish industry".