FARMERS' subsidies have been slashed because of a buried bombshell in an agreement struck in Brussels nine months ago.
The agreement has allowed the Westminster Government to shave a total of 17 per cent off Single Farm Payments in England in order to divert money into other forms of rural assistance, such as enterprise grants and payments for environmental stewardsh
ip.
Farmers are getting cheques which are thousands of pounds less than last year, after one of the worst years on record in the livestock sector.
The amount taken for so-called "modulation" – diversification of funding – is much higher in Britain than any other European Union government has found necessary.
A devastated sheep farmer told the Yorkshire Post: "We knew something was going on with modulation but assumed that if it was that bad, there would still be a fight going on. It is only when you see it on paper that you realise how bad it is.
"Last year I got £28,702. This morning, I got a cheque for £23,823, with a slip of paper recording adjustments for £1,435 of EU modulation and £3,442 of national modulation for England.
"That's nearly £5,000 I am down, on top of the £7,000 I have lost on the lambs business because of movement restrictions.
"It puts me in an absolutely desperate position. This is just completely the wrong time to be taking money off the grant that keeps most farmers afloat."
The losses swamp the small increase in Hill Farmers Allowance which was supposed to compensate the lamb and suckler-cow businesses of the Dales and moors for taking the brunt of the movement problems knocking on from foot and mouth and bluetongue. That amounted to £700 in the case of this farmer, a fairly typical case.
For livestock farmers on poor pasture, grants just about make up for the gap between costs and income, if they are super-efficient. They point out that a much wider economy is dependent on their survival – and they have been warning for months that most will go out of business unless something changes quickly.
Swaledale farmer Alastair Davy, campaigning for urgent Government action and consumer awareness of the need to buy British, says the Government could repair some of the damage by putting the "modulated" money into a ring-fenced fund for hill farm support.
Mr Davy said: "The Government's enterprise and environment schemes are hard to qualify for when you are already putting all your energies into keeping your head above water. And you usually need to match-fund, which we cannot afford.
"A lot of the money ends up going into cemetery walls and village halls and so on, which is all very nice but it is not helping to save farming."
A spokeswoman for the Department of the Environment, Food and Rural Affairs (Defra) said £100m of the money set aside by modulation would be used to "assist the livestock industry". But the money will go to education schemes, not direct to farmers.
The scale of the cuts has been revealed over the past two weeks because the Rural Payments Agency, which is in charge of implementing Defra's exceptionally complicated funding formula, has made a big effort to speed up its service and 20,000 farmers have got their 2007 cheques early, in a try-out of the improvements made to the system.
The National Farmers Union says all modulation should be the same, across Europe. The Tory Shadow Minister for Agriculture, Jim Paice, agrees: "As it is, English farmers are facing a double whammy – they will get their payment much later than their European competitors and will have more creamed off."
The West Riding delegate to the NFU general council, Frank Chislett, said: "I am waiting for my single farm payment and the figures you are quoting come as a shock to me."
He added: "Defra has become so fragmented, with Ministers responsible for so many different areas, you don't get joined-up thinking. And this business over modulation is a classic example."
