Select Committee on European Communities Eighteenth Report


Less Favoured Areas

  33.    Agenda 2000 suggests converting the current less favoured area payments (compensatory allowances) into "a basic instrument to maintain and promote low input systems". The NFU suggested that consideration be given to this (p 242) and the CLA noted that there would be serious consequences for the economy and environment were farming not practised in such regions (p 46). Mr Merricks noted the environment's dependence on farming and the consequences should the land be abandoned (Q 63). The ELO however was opposed to the proposal. They contended that the overlap between areas of high nature value and less favoured areas, though it exists, is not as considerable as the Commission seems to believe. They noted that current farming in less favoured areas is hardly benign and drew attention to overgrazing and overstocking. The Commission's approach, they considered, could lead to the undesirable development of two stream agriculture (p 51). This was the reason the Government had reservations (Q 295). Mr Merricks considered that any environmental policy should only be pursued for clear environmental gain and that that aim should be clearly identified. He cited the evidence of Sir Michael Franklin [28]to our previous enquiry on reform of the CAP in support of this (p 28), and the Government made his point again (QQ 295, 306).


  34.    Witnesses expressed opposing views on cross-compliance. In support of the attachment of environmental payments to production subsidies or compensation payments was English Nature (p 220). The Environment Agency and some conservation groups saw scope for cross-compliance as an interim measure (p 227) until production subsidies were removed. In opposition was the ELO who considered that as the production regimes were on their way out, cross-compliance was no policy for the future (p 51). Professor von Urff was also opposed, noting that "specific tools should be used for specific purposes" (Q 369). This was the attitude of the Government (Q 315). The NFU was concerned that, should cross-compliance be introduced, there must be a very clear Community framework for its use lest environmental and financial disparities arise between Member States (p 242). The competitive aspect was Mr Merricks' concern, lest such a policy "render the resource of the UK's agricultural industry internationally inefficient, un-competitive and economically un-sustainable. All for no sound justifiable environmental reason and a potential example of short term political expediency at its worst" (p 28). Strutt & Parker considered cross-compliance potentially dangerous, for while the United Kingdom farming community generally accepted regulation, the policy would undoubtedly antagonise the militant French farming community who were much less likely to accept it (QQ 212-13).

Horizontal approach

  35.    FWAG noted the benefits of the Environmentally Sensitive Area, Countryside Stewardship and Welsh Tir Cymen[29] schemes. They were a good starting point whose geographical coverage had to be expanded (pp 228-9). The Royal Institution of Chartered Surveyors (RICS) considered horizontal availability of the current United Kingdom projects to be the next important step (p 252), as did Strutt & Parker who said that in a country as small as the United Kingdom anything other than horizontal measures was "conspicuous unfairness" (Q 207). The CLA argued for environmental payments to be available to all farmers (p 47). This should include the fens of East Anglia which were not to be written off as industrial farming areas. Two tier agriculture was not to be encouraged (Q 102). Mr Merricks noted that environmental goods and competitive agriculture could well exist on the same farm, although not on the same land (Q 59). The Environment Agency recommended a horizontal regulation for air, water and soil protection and targeted measures for specific species and habitats (p 225). They considered that good work had been achieved by the Nitrate scheme (p 226). Dr Fennell expanded the issue of availability of schemes to include enforcement and uptake: horizontal availability was pointless without monitoring of uptake and then compliance. In her opinion environment policy was not an optional extra to be ignored or applied as Member States chose. Insofar as it was so, wide disparities could arise between Member States which would increase the likelihood of an effective two-speed Europe (p 38), a concern shared by the Government (Q 303).


-  Contradictions

  36.    Reform urgently needed to address contradictions in policy. The RICS noted that the success of agri-environmental schemes was dependent on "removing the inconsistencies in funding policy between promoting production and promoting environmental measures" (p 252). Agri-environment schemes were utterly unable to compete with the CAP's production subsidies (p 18) and indeed were in complete opposition, the most damning example being Hill Livestock Compensatory Allowances, paid per livestock unit, coupled with a small agri-environmental payment to reduce stocking densities in the same areas (p 182). Dr Fennell considered that insufficient thought had been given to the measures, especially to the different approaches needed for different sizes of farms and thought that some current policies were damaging when applied to small farms (for example grubbing-up in wine producing areas) (p 38). The local government officers were scathing: current agri-environmental measures did "not count for much", were "totally inadequate" when compared with overall income through the CAP, and were "in direct opposition to what the CAP is doing" (Q 162).

-  Complexity

  37.    The Countryside Commission noted that environmental problems had largely been tackled ad hoc by introducing measures on top of existing structures. Each instrument had its own rules, procedure and administration (p 182). The Environment Agency argued that it was difficult for anyone to take a view as to the total environmental impact of the measures as they were so disparate (p 226). Most importantly, Strutt & Parker commented that the farmer found it difficult to comprehend for what, to whom and how to apply due to the proliferation of schemes (Q 206). The Countryside Commission advocated, as did others, the integration of smaller environmental measures into the main English Countryside Stewardship scheme and ultimately into a single scheme for the United Kingdom. The CPRE saw the advantage of this approach, and advocated that the scheme should concern itself with the whole farm and not with specific habitats (QQ 191-2, p 92). English Nature also advocated the national approach but was concerned that each county should remain able to identify its own priorities. In relation to this, the CLA and Countryside Commission argued that Community level policy should not be over prescriptive and that Member States, and indeed localities, should remain in control of menu design subject to a Community framework (pp 47-8, 182).

  38.    The Countryside Commission recommended that there should be simplicity in relation to funding (pp 190-1): the applicant should be able to apply to one funding source at regional level and the regional body should then claim reimbursement against the different Community funding elements. The Countryside Commission created an example of how such an approach would produce benefit (p 190). The CPRE noted that such an encompassing approach was taken by Tir Cymen and proved admirably flexible (Q 190), also advocated by the local government officers (Q 162).

  39.    The application of the schemes was inflexible: Mr Merricks was most frustrated that he could not combine the ESA[30] and SSSI[31] measures to produce work of great environmental benefit (Q 73), nor could set aside land be improved through the Countryside Stewardship scheme (p 29). The Countryside Commission too drew attention to the problem of barriers between measures (p 195). The Environment Agency also commented on the lack of integration between different schemes (p 226). On this issue, FWAG called for the approach to be "tailored to, not targeted at" the problem (p 230). English Nature considered it too limiting that only registered agricultural holdings were eligible for payments.


  40.    The Commission's implementing Regulation had introduced a degree of rigour to the administration and monitoring of agri-environment schemes, but the NFU considered that the way in which this had been put into use in the United Kingdom was flawed. The current practice caused confusion among agreement holders, increased administrative costs and introduced "apparently arbitrary constraints on eligibility for schemes and rates for incentive payments" (NFU, p 238). Dr Fennell noted that the Community had already experienced the problems of lack of monitoring in relation to BSE[32]: "if you do not provide the funds, if you do not provide adequate numbers of inspectors, if you do not provide adequate monitoring, then you should not be surprised at the outcome" (Q 87). Professor von Urff noted that the Commission needed to be stricter as there were wide discrepancies between the different German Länder: some made an effort, for others monitoring was a superficial process carried out only as it was compulsory (Q 362). The Government noted that some Member States had but reluctantly initiated monitoring (Q 314) and urged improvement (Q 295). The United Kingdom Objective 5b Partnership noted that the Structural Funds have produced a report on their achievements and suggested that the CAP be subject to a similar exercise.

Need for clarity of objectives

  41.    Environmental value and value for money per se were both commented on by our witnesses. While the RSPB considered agri-environmental measures to be better value than production subsidies, they argued that the measures' benefits should be clearly defined (p 19). Based on a BirdLife International study of existing measures in 8 Member States, the RSPB considered environmental expertise to be lacking in the design and running of schemes (p 19). The Environment Agency argued that even the aims of the existing measures were not based on any clear analysis of what needs to be done and the schemes did not provide value for money (pp 226-7). English Nature noted this lack of targets especially in relation to Environmentally Sensitive Areas (p 220) and considered that aims could quite easily be identified (p 221) as, for example, in relation to the Biodiversity Action Plans and the Habitats and Species Directives.


  42.    Every witness supported the aim of rural development and the economic diversification of the United Kingdom's rural areas, though predictable differences were found in the scope and scale of diversification encouraged. The NFU's vision of a "strong and diverse rural economy with well balanced rural communities" (p 235) was supported by all, which tallies well with the aim of the Rural Development Commission to support the "well being of those who live in rural areas" through "economic diversification, environmental protection and combating social exclusion" (p 115).

  43.    The CLA considered it "disturbing" that Agenda 2000 did not give sufficient thought to aid and measures for transition (p 46) and the ELO was most disappointed that development did not play a greater role in Agenda 2000 (p 48).

Economic diversification

  44.    Many witnesses said that jobs formed the basis of socially mixed and vital communities (Eg pp 46, 256). The Countryside Council for Wales noted the social policy aspect of rural employment (p 194). Several environmental groups argued that environmentally friendly or enhancing jobs should be valued ahead of alternative employment opportunities (Q 172, pp 20, 182). The Rural Development Commission noted that dynamic communities would contribute to sustaining the environment (Q 253). This was supported by the Rural and Allied Trades section of the Transport and General Workers' Union (p 256), and the NFU (p 235), who considered that all those currently involved in working with the land would prefer to remain in contact with it-in agriculture or up or downstream.

  45.    While tourism, craft industry and local produce may be appropriate for some areas, indeed sometimes the only option (QQ 106, 225), nevertheless, argued Strutt & Parker, "there are only so many baskets that can be weaved" (Q 215). They have been much involved in encouraging new industry to develop in rural locations and their written evidence includes case studies of successful ventures (pp 111-13). The United Kingdom Objective 5b Partnership likewise argued that the Commission's traditional view of local produce and tourism should now include non-agricultural industry. Importantly, such jobs must be viable without public funds. Any funding should be transitional.

  46.    Diversification involves the conversion of buildings to new use. Strutt & Parker have been much involved in this as have the Rural Development Commission (pp 112-13). It was widely felt that development was encouraged by the February 1997 revision of the Department of the Environment's Planning Policy Guidance Note 7 "The Countryside-Environmental Quality and Economic and Social Development" (PPG 7), though Strutt & Parker commented on a lack of sympathy towards their projects from some planners (Q 217), and suggested that a national intermediary be set up to smooth applications and ensure consistency between local authorities (Q 226). English Heritage warned that there was no adequate test of redundancy prior to permission to convert (p 214), though Strutt & Parker drew attention to the large number of redundant and decaying buildings (Q 222). A noted problem was the need for expansion of successful ventures (QQ 232-3), which were often forced to move to new premises. In those circumstances the building and work-force left behind are appropriate to something other than agriculture and a new enterprise should be able to move in swiftly.

  47.    Dr Fennell was not alone in pointing out that development must occur both on and off the farm (p 39). This was reinforced by the local government officers, the Rural Development Commission and Strutt & Parker, who felt that farmers were busy farming and not best placed to run new businesses themselves (QQ 157, 214)

28   Former Permanent Secretary, Ministry of Agriculture, Fisheries and Food. Back

29   For a description of Tir Cymen, see the written evidence by the Countryside Council for Wales, pp 194-211. Back

30   Environmentally Sensitive Area. Back

31   Site of Special Scientific Interest. Back

32   Bovine Spongiform Encephalopathy-`Mad Cow Disease'. Back

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