Wednesday, July 13, 2005

Hill farming crisis raises broader issues

The UK charity, the National Trust, has warned that the country's hill farmers are on the brink of a national crisis. The charity has stated: 'Hill farming is on the brink of a rapid and unmanaged collapse without help through the major changes it faces. The separation of support payments from agricultural production has exposed the stark reality that livestock farming in the hills simply is not profitable.'

The National Trust bases its conclusions of a survey of sixty of its tenanted farms which suggests that the majority of upland farms are facing severe falls in income. Recently the Trust let out a farmhouse to a non-farming tenant much to the anger of neighbouring farmers in the Lake District.

Some farms will see their support payments halved over the next five years which could force large numbers of farms to go out of business. The UK govermment's stated intention is to scrap the Hill Farm Allowance, which is funded out of the national budget, in 2006. The National Trust, however, would like to see its funding increased from £27m to £50m.

This crisis does raise broader issues. Recently, farm commissioner Mariann Fischer Boel argued that the level of support for agriculture was exaggerated as it constituted less than 0.5% of European GDP. However, that overlooks the fact that farming is a business activity. Should any commercial activity receive a general subsidy?

Where a subsidy is justified is for the non-marketable benefits that farming produces such as an attractive landscape and countering rural depopulation. If hill farming ceased, the landscapes that attract visitors to areas such as the Lake District would disappear. Drystone walls would crumble and the grazed landscape would revert to bracken and scrub, making it less accessible to walkers. Yet, as we know, the majority of CAP subsidies go to large-scale arable farmers.

Marginal farmers do deserve assistance, although it has to be packaged in a way that delivers environmental benefits and assists rural development.

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