Jeffrey Titford MEP in Farmers Guide (April 2009)

The CAP - Who Really Benefits? By Jeffrey Titford UKIP MEP

The traditional view of the Common Agricultural Policy (CAP) is that it was created to make Europe self-sufficient in food production and to ensure that smaller farmers were able to make a living. By the early 1970s, the CAP had more than achieved the self-sufficiency target. Farmers, encouraged by massive amounts of taxpayers’ money, were producing far more than EU citizens could eat or drink. Naturally, they chose to grow whatever attracted the largest subsidies, regardless of whether there was a genuine market for what they produced.

A new book, ‘The Great European Rip-Off’, by David Craig and Matthew Elliot and sub-headed ‘How the Corrupt, Wasteful EU is Taking Control of our Lives’, published by Random House has an excellent section where it exposes the history of the CAP and also shows how it is now disastrously failing all but the richest farmers and lining the pockets of many who have little to do with farming.

The book makes it clear that Brussels , in coming up with the CAP, had in fact created a monster, which rapidly grew out of control. In the 1970s, there were beef and butter mountains and a huge 17.8 billion litre lake of extremely poor quality wine. The taxpayer, having shelled out for this over production also ended up paying for most of it to be stored, reprocessed and frequently destroyed. All of this was happening against a backdrop of a billion people in the Third World starving, with about 9 million dying of hunger and malnutrition each year. Not a pretty picture.

The book goes as far as to suggest that had Britain and Denmark not joined in 1973, the hugely expensive over-production generated by the CAP would have bankrupted the then European Economic Community. We now call it the EU. The generous new contributions from taxpayers in these two countries kept the whole thing going and have helped to create the strange situation that we find ourselves in today, where the CAP has become terribly distorted and diverted from its original purpose.

The EU frequently claims that the CAP is a key ingredient in maintaining the EU economy and sustaining a sector that is responsible for 19 million jobs. Among the key benefits the EU claims for CAP is that it ‘spends the money where it is most needed,’ but does it? Traditionally, French farmers are supposed to be the biggest beneficiaries of CAP largesse, although only 10% of EU farmers are located in France . The CAP ensures that they receive 25% of all CAP money. 130,000 French farmers each receive £18,400 per annum. This compares with around 120,000 farmers in the UK , Germany and Spain combined, receiving this level of subsidy. There are also 3,000 French farmers receiving annual subsidies of £91,940.

Indeed, looking at where most of the CAP money is spent, the suggestion that it is being spent ‘where it is most needed’, becomes highly questionable. 85% of the budget (£55.3 billion) goes to just 18% of farms and the most wealthy 2% of farmers and agricultural companies receive no less than a quarter of the total budget. The identity of the recipients tends to be shrouded in secrecy and one Scottish newspaper battled for more than two years to identity CAP subsidy recipients in Scotland . They eventually discovered that the country’s largest farmers were receiving an average of £230,000 a year, while the average subsidy for all farmers in Scotland was a mere £9,000.

Two large food companies in Sweden and Denmark , hardly the most needy of recipients, have been given a combined total of £1.37 billion since 2000. Another major company, Campina operating in Germany , Holland and Belgium has had almost £920 million. Nestle, which operates in Britain , Austria , Denmark , Spain and Holland has received hundreds of millions. Even closer to home, Tate & Lyle is one of Britain ’s largest CAP recipients at £100 million a year.

Landowners who don’t actually do any farming have a hand in the pot and even airlines and cruise ship companies are getting hand-outs as they are allowed to claim because they are exporting food! Think of that next time you tuck into an airline bread roll! However, altogether the most disturbing of the decidedly odd list of CAP beneficiaries is the four French banks, based in the poshest areas of Paris . The BNP, Credit Mutual, Credit Agricole and Banque Populaire have each received over £91.9 million for supporting French agriculture largely through loans to farmers. There are vast sums also given to members of the Royal families of a number of European countries including our own.

When you consider that the average subsidy given to farmers in the EU is probably as low as £8,000 a year, you have to question the whole purpose of the CAP. The problem is that whenever suggestions are made about reducing subsidies, enraged farmers take to the streets to protest, little realising that they are protecting the interests of a lot of very wealthy people. The EU has promised to publish details of CAP recipients this month (April). It will be interesting to see if they keep this promise and if there is any reaction from our normally supine media when they see how the CAP is making the rich richer.