Women's Food and Farming National Conference 12 th April 2012 CAP Reform Presentation by Richard Ashworth MEP

Food security and the CAP World population reaches 9 billion by That means an extra 182K people per day, or - A new population the size of the UK every year for 30 years. 1 billion lifted out of poverty. Climate change impact and global productivity. Foresight report, UNFAO and the European Commission agree that the world must double food output by Food security: Of strategic importance to governments. Supported agriculture is here to stay.

Food industry: Important to the EU economy Food industry is one of the largest and most important manufacturing sectors in Europe. It is the second largest (after metal) in the manufacturing industry, with 14.5% of total manufacturing turnover (€917bn for the EU-27). Employment in the food industry represents about 14% of the total manufacturing sector. Europe is the world’s largest importer of food. That is greater than 35 million hectares entering the EU each year. Economic and moral case for increased productivity.

European budget Limited size. Changing priorities. Jobs, growth and competitiveness. Pressure on traditional spend.

Public perception Low awareness of global food security. No awareness of the impact on the EU. Perceived conflict between output and environment. Perceived conflict between technology and food quality. “Disconnect” between opinion in the car park and behaviour with the trolley! Low awareness of imbalance of power in food chain.

Commission proposals Greening: Pillar 1 or Pillar 2? Compulsory set aside: Multi-cropping, permanent pasture and organic. Definition of an active farmer. Capping: Proposed ceiling of €300K affects UK most. New member states: Equalisation of payments.

The Commissioner’s proposals Reverses the direction of travel of 3 previous reforms. Compulsory set aside, permanent pasture - A logical method to control output. Perverse: Stimulates and subsidises food mountains when there is a global surplus. Promotes “extensification” when there is a global shortage. Simplification: 15% increase in admin cost! MEPs powers under Lisbon Treaty: Agreement in 2013?

Who? & What? WHO should the CAP support? WHAT is the purpose of the CAP? Q: Food, Environment, Regional, or Social policy? Different nations = Different priorities. FACT: UK receives €3bn (£2.5bn) from CAP p.a. FACT: 56% of the net farm income of an average UK farmer is the Single Farm Payment. (source: Ernst & Young)

What if the EU didn’t fund the CAP? Either: Treasury would pay farmers £2.5bn per annum. Or: Consumers would pay £2.5bn extra. Adds inflationary costs to industrial society. Attracts large scale imports particularly from countries with subsidised agriculture. Strategically dangerous at a time of global food security concern. Would still have to pay for public goods.

Conclusion Not realistic to end farm support. There will never be a level playing field. USA and France will always subsidise. Supported agriculture is here to stay. Is €50bn a year value for money?