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Where does the money go? 28 October 2008 Puławy, Poland Jack Thurston Co-founder, farmsubsidy.org
Where does the money go?
28 October 2008
Puławy, Poland
Jack Thurston Co-founder, farmsubsidy.org
If Europeans knew how the EU spends €55 billion a year on farm subsidies...
Would they approve?
Our method
Freedom of information
+Investigative reporting
Vigorous debate
+Better policy
=
May 06 May 07 August 08
Value of payments €33 billion €55 billion €66 billion
Number of payments n/a 8.2 million 12.1 million
Number of recipients 0.9 million 2.6 million 6.5 million
Countries 8 18 21
Data obtained - timeline
Amount €Number of payments
Number of recipients
2 098 371 339 3 218 470 1 396 874
CAP payments in Poland, 2007
In Poland the biggest 20
per cent of recipients got
67 per cent of all payments
(2007)
Recipient name Location Amount €
Spółdzielcza Agrofirma Witkowo Witkowo Pierwsze 4 255 935
Top Farms Głubczyce Spółka Z.O.O Głubczyce 4 064 372
Top Farms Wielkopolska Sp. Z O. O. Piotrowo Pierwsze 3 991 238
Kombinat Rolny Kietrz Sp.Zo.O. Kietrz 3 814 261
Poldanor S.A. Przechlewo 3 798 350
Kom-Rol Kobylniki Spółka Z O.O. Kobylniki 2 221 563
Agro - Skandawa Spółka Z Ograniczoną Odpowiedzialnością Agro - Skandawa Sp. Z O.O.
Aptynty 2 084 845
Rolnyvik Sp. Z O.O. Barciany 1 922 988
Polska Hodowla I Obrót Zwierzętami Sp. Z O.O. Szymankowo
Szymankowo 1 808 175
Agri Plus Spółka Akcyjna Konarzewo 1 558 059
Top 10 recipients, 2006 & 2007
Business & Media |21.05.066 |||| BUSINESS
Who’s creaming off EU subsidies?
CASH COWS
WHAT IT COSTS THE TAXPAYER TO DESTABILISE DAIRY MARKETSBritish export subsidies, bydestination country, 2004 and 2005
Export subsidy granted, by company, 2004 and 2005
SOURCE: FARMSUBSIDY.COMPHOTOGRAPH: ALAMYGRAPHIC: CATH LEVETT
NIGERIA£11,782,308
IVOIVORY COASTCOAST£5,722,515722,515
DHAILANDTHAILA06,805£6,706,80£6
OMANOMA,660,973£4,660,97
SAUDIARABIA
£2,147,003
SUDAN£3,906,970
ESIAINDONESIAIND8£2,947,118£2,94
INDIA£1,244,914
BANGLADESH£3,479,499
NESIPPINEPHILIPPH,901,708,9£1,7
NAPANJA27344,2£1,24£
ALGERIA£9,413,948
EGYPYPT£3,03,031,340340
JAJAMAICAAICA£2£2,296,9296,9877
MEXICO£7,714,200
VENEZUELA£2,274,752
UAE£6,016,605
*includes subsidiaries
£1 to £4m
KEY
£4 to £7m £7m+£0m 5 10 15 20
£22,149,818
£21,957,002
£19,391,504
£7,442,672
£6,421,069
£6,016,872
£4,863,754
£4,009,257
£3,335,750
£3,084,188
FayrefieldFoods*
Philpot DairyProducts
DaleFarm*
NestleUK
TMC Dairies(NI)
HoogwegtInternational
Lakeland Dairies(NI)
Eilers & WheelerSales
MeadowFoods
F UhrenholtDairy
British-based exporters, includingNestle and Dairy Crest, haveclaimed £126m of taxpayers’money over the past two years for
sending surplus butter and milk powder topoor countries such as Nigeria andBangladesh, according to a new reportobtained exclusively by The Observer.
Export support for British dairy prod-ucts is only a tiny part of the complex!43bn web of farm subsidies thatstretches across the European Union.But by anatomising this one subsidy indetail, the figures provide a startling pic-ture of how the Common AgriculturalPolicy (Cap) works to prop up priceswithin Europe, with reverberations farbeyond the farms of the home countiesand Northern Ireland.
The data, obtained by Jack Thurstonof campaign group farmsubsidy.org,using Freedom of Information requeststo the government’s Rural PaymentsAgency, shows that most of the recipi-ents of the cash are large agribusinesses.
The biggest winner, Fayrefield Foods,was able to bank more than £22m overtwo years, 2004 to 2005. Philpot DairyProducts, the export arm of Dairy Crest,which owns well-known brands such asCountry Life and Clover, also claimed atotal of almost £22m. These levels of sub-sidy are enormous relative to the size ofthe companies: the £10m claimed byFayrefield Foods in 2004 was worthalmost 10 per cent of its turnover, forexample, and dwarfed its profits, whichwere less than £1m. Nestle, whose exportof skimmed-milk powder to developingcountries has long been controversial,received more than £7m.
The total cost of the dairy subsidyregime across the EU is more than !1bn.Dairy farmers receive some subsidiesdirectly, but much of the money goes toprocessors and exporters – who are paidby EU taxpayers – to underpin prices.
To maintain these artificially highprices, cheap dairy products from moreefficient producers, such as NewZealand, are kept expensive usingimport taxes. At the same time, theprocessors are given financial help tooffload their surpluses.
Until the 1980s, the EU simply boughtany extra production and piled it up inwarehouses, forming what became
known as the EU ‘butter mountain’(‘wine lakes’ were another manifestationof the same problem). But after a barrageof criticism of this very visible waste,Brussels switched its attention – and itscash – towards exporting the products.
Since the EU price is so much higherthan the world average, farmers aregiven a refund for each kilogram of but-ter or skimmed-milk powder theyexport, so that they can sell at somethingcloser to the market price and avoidmaking a huge loss on the transaction.This year the subsidies are !109 (£73) forevery 100kg of butter exported.
Trade campaigners argue that thescale of the exports – £47m was spent on
refunds in the UK alone last year –means rather than smoothing out fluctu-ations in dairy production, the exportsubsidies have created an entire industryout of dumping cut-price products inpoor countries, often damaging the localagricultural industry, and driving otherpotential producers out of the market.
Many of the countries revealed as
major destinations for exports are sur-prising. British firms were handed£11.8m over the two-year period forsending milk products to Nigeria, forexample, and almost £6m for sendingproducts to Côte d’Ivoire.
A recent report by Cafod found thatimports of cheap, EU-subsidised milkpowder had devastated the Jamaicandairy market, for example, causingdomestic production to plunge, anddamaging the livelihoods of small-scale,local producers.
For the consumers of the butter andmilk powder, the cut-price products canbe a bonus: that’s one argument oftenused to defend the subsidies. But in anyother industry, the idea of the Europeantaxpayer paying producers to sell goodsabroad at lower prices than in Europe’sshops would seem odd to say the least.
Campaigners complain that shiftingthe butter mountain into developingcountries stifles agricultural trade, bycrowding out domestic farmers whocan’t compete with the might of the EU.
‘In many of these countries, buying a
Exports of cheap European dairy products are crushing the livelihoods of developing world farmers, writes Heather Stewarton behalf of the EU, said Britain wouldlike to see them abolished.
‘We would prefer that export refundsdisappeared as soon as possible; but aslong as they are there, British farmers areentitled to claim them just like all EUfarmers,’ he said. He added that the gapbetween the fixed EU price and theworld price had narrowed in recentyears, and argued that the amount spenton export refunds had been ‘witheringaway’.
Britain’s small-scale dairy farmers,many of whom have been driven out ofbusiness recently, see little of the benefitsfrom the subsidies. They sell their milkto processors and supermarkets, which
often have a strong position in the mar-ket place, driving down farmers’ mar-gins. A recent report by aid group Cafodfound that farmers were paid less thanthe cost of production for their milk.Even the EU admits that the export sub-sidies are unfair, and agreed to phasethem out – though not for seven years.
But in the ongoing WTO talks, Man-delson is battling, on the EU’s behalf, tocling on to most of the lavish Cap sys-tem. Uncovering the details of the dairyexport regime, just one small corner ofthe Cap, confirms that any system aimedat fixing the market creates strangeanomalies, and knock-on effects else-where.
The new figures also powerfully con-firm campaigners’ claims that the smallfarmers who are meant to be protecteddon’t see much of the cash: and in a glob-alised marketplace, a scheme dreamedup in Brussels has ramifications thou-sands of miles away, including in some ofthe world’s poorest countries.
‘Milking The System’ is available at farmsubsidy.org
Peter Mandelsonagreed to Europegiving up exportsubsidies by2013. Critics saythis is no help tofarmers drivenout of business.
cow is one of the most reliable ways oflifting yourself out of poverty,’ saysThurston, who is trying to compile aEurope-wide directory of how Capsubsidies are spent.
Sheila Page of the Overseas Develop-ment Institute says small-scale farmersin Bangladesh or Indonesia would prob-ably not be the beneficiaries if the subsi-dies were removed; but more efficientexporters, such as Argentina and Aus-tralia, could win such markets in fair(unsubsidised) competition.
‘If they weren’t getting it from the EU,they would be getting it from some-where else – Argentina, South Africa,Australia,’ she says.
Peter Mandelson, who negotiates onbehalf of Europe in the current ‘DohaRound’ of World Trade Organisationtalks, agreed in December that Europewould give up its export subsidies by2013. However, it it is not clear how thephase-out will happen.
Page says that’s little help for farmersin poor countries who have been drivenout of business by the existence of thesubsidy regime. ‘They’re being damagednow, and the fact that the subsidies won’texist after 2013 won’t be much comfort.’
Britain argued strongly for an earlierdeadline for the abolition of export sub-sidies, but Mandelson made it clear thathe saw the 2010 deadline advocated bysome campaigners as ‘unrealistic’.
A spokesman for the Department forthe Environment, Food and RuralAffairs, which administers the payments
F armers are given arefund for each kilo ofbutter or skimmed-milkpowder they export| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
European taxpayers arepaying producers to sellgoods abroad at lowerprices than in Europe| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Land of milk and moneyEACH TIME you rip open aminiature plastic packof butter to spread onyour in-flight roll, half-wayacross the Atlantic, thecaterer is clocking uphow much it can claimfrom the European Union for‘exporting’ a dairy product.
The giant milk processors and tradersare not the only firms able to dip into tax-payers’ cash each time milk or butter leavesthe EU. Gate Gourmet and Lufthansa Sky
Chefs, the major providers of in-flight catering, are among thestrangest claimants of exportsubsidies for dairy products.Each of them has received
more than £100,000 over thelast two years.The EU also paid out
£14,026 in export refunds toNeal’s Yard, the upmarket cheesecompany with swanky outlets inLondon, which also sends itsproducts overseas, including tothe US.
Another £1.75m was claimed inBritain by companies carrying milk prod-ucts out to ‘ships’ stores, oil and gas rigs’,while £1m was paid out for ‘victualling’ on
vessels belonging to non-EUmember states,
which apparentlyalso qualifies asexport. And£4,092 of taxpay-ers’ money wenton sending milk products to
Antarctica.
Renault chutesur un marchéfrançais en baisse
DROIT D’OPPOSITION DE LA CGT ET SUD
Accord controversé pourla future Banque Postale
L a Poste continue d’affronterles obstacles pour créer sa
filiale bancaire. Un accord-cadre a été signé fin septembrepour accompagner le person-nel qui basculera vers la BanquePostale. Ce texte a fait l’objetd’un droit d’opposition deSUD et de la CGT, organisa-
tions majoritaires. Faute d’ac-cord, les mille cadres devant re-joindre la banque manquaientde garanties. Aussi La Poste a-t-elle troqué son accord-cadrepour un accord réduit au péri-mètre de sa filiale Efiposte.SUD entend porter l’affaire de-vant les tribunaux. P. 24
32.000 SUPPRESSIONS D’EMPLOIS D’ICI À 2008
Purge sociale chez Deutsche TelekomDeutsche Telekom, premier
opérateur européen de télé-phonie, a annoncé hier qu’il al-lait se séparer de 32.000 salariésen Allemagne durant trois ans.Ceprogramme devrait lui coûter3,3 milliards d’euros. Le pluslourd fardeau revient à la filiale detéléphonie fixe,T-Com,qui devrase séparer de 20.000 personnes
sur 111.000 à temps plein qui, àla fin 2004,représentaient près dela moitié de l’ensemble du per-sonnel. La Bourse a salué cetteannonce. Le syndicat des ser-vices Ver.di a l’intention de résis-ter à ce plan. Un moratoire signéavec les syndicats interdisait àl’opérateur de supprimer des em-plois jusqu’en 2005. Mais son
patron, Kai-Uwe Ricke, n’a ja-mais exclu que des mesures de ra-tionalisation soient lancées aprèscette date. La téléphonie est enplein bouleversement.L’espagnolTelefonica vient ainsi de lancerune offre amicale sur le britan-nique O2. Hier, l’irlandais Eir-com annonçait avoir été approchéen vue d’un rachat. P. 21
! ÉCONOMIEEMPLOI. Le Cerc veutréformer l’indemnisationdu chômage. P. 4
! ENTREPRISESCLUB MED. Retour àl’équilibre en 2005. P. 18
RENSEIGNEMENTS. FranceTélécom compte resterleader du marché. P. 22
! FINANCERÉASSURANCE. Swiss Reaffaibli par les cyclones.
P. 24
! MARCHÉSEURONEXT. Activitéhistorique en octobre. P. 27
! « La Tribune » publie l’étuded’un groupe de recherchequi lève une partie du voilesur ce que touchent 24 grosbénéficiaires de la politiqueagricole commune européenne.
! Mais la France refusetoujours de révéler leur nomen s’abritant derrièrela protection des donnéesprivées.
! Pourtant, sous la pressiondes ONG et avec la bénédictionde Bruxelles, plusieurs payseuropéens ont livré des listesnominatives.
Agriculture : à qui profitela PAC en France
P. 2 ET 3 ET ÉDITORIAL P. 43
*Fra
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mét
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litai
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PH
OT
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: SU
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RTZ
/AP
A lg érie : 85 DZD . A llemagne : 1,55 !. Andorre : 1,40 !. Ant illes-Réun ion-G uyane : 2 !. Be lg ique : 1,25 !. C anada : 2,75 D C . Espagne : 1,50 !. Grand e-Bretagne : 1,10 LS. Grèce : 1,65 !. Ita lie : 1,55 !. Lux : 1,25 !. Maroc : 14 D H . Portuga l cont . : 1,60 !. Su isse : 2,60 FS. Tun isie : 1.800 MT. Zone C FA : 1.150 F C FA . ISSN 0989-1922.
LaTribuneJeudi 3 novembre 2005 - 1,20 !* LE QUOTIDIEN ÉCONOMIQUE ET FINANCIER www.latribune.fr
L es immatriculations de l’ex-Régie ont baissé de 11,7 % en
octobre. La plupart des modèlesplongent. Le gâteau automobilefrançais s’est replié de 5,8 %.
P. 14
L’ANALYSE DU JOURPhantasme et réalitédu péril chinois. P. 32
E s p è c e e n v oie d ’ a p p a ritio n e n b o u r s e
p a g e 9
No 24.465 - 3.279
"
EU Budget Transparency (at last!)
30 Sept 2008: Pillar 2 + non-CAP
30 April 2009: Pillar 1
That’s 27 websites!(even though the Commission possesses all the data itself)
✔ Name✔Municipality✔ Amount
✘ Business ID✘ Geodata✘ Schemes
Some analysis
A flat rate for direct
payments would benefit
new member states
Elláda
Malta
Nederland
Belgique/België
kypros/Kibris
Danmark
Deutschland
Ireland
Luxembourg
France
Italia
Slovenija
Sverige
Česká republika
Suomi/Finland
United Kingdom
Österreich
Magyarország
Slovensko
España
Polska
Portugal
Bulgaria
Lietuva
Eesti
Romania
Latvija
0 100 200 300 400 500 600
Direct payments, € per hectare, 2013
Elláda
Malta
Nederland
Belgique/België
kypros/Kibris
Danmark
Deutschland
Ireland
Luxembourg
France
Italia
Slovenija
Sverige
Česká republika
Suomi/Finland
United Kingdom
Österreich
Magyarország
Slovensko
España
Polska
Portugal
Bulgaria
Lietuva
Eesti
Romania
Latvija
0 100 200 300 400 500 600
Direct payments, € per hectare, 2013
A flat payment at
at €229 per hectare
Countries that lose
ElládaMaltaNederlandBelgique/Belgiëkypros/KibrisDanmarkDeutschlandIreland
LuxembourgFranceItaliaSlovenijaSverigeČeská republikaSuomi/FinlandUnited Kingdom
Countries that gain
ÖsterreichMagyarországSlovenskoEspañaPolskaPortugal
BulgariaLietuvaEestiRomaniaLatvija
Elláda
Malta
Nederland
Belgique/België
kypros/Kibris
Danmark
Deutschland
Ireland
Luxembourg
France
Italia
Slovenija
Sverige
Česká republika
Suomi/Finland
United Kingdom 7
14
14
22
32
39
54
58
82
110
128
133
209
211
359
366
Subsidy cut per hectare / €
Latvija
Romania
Eesti
Lietuva
Bulgaria
Portugal
Polska
España
Slovensko
Magyarország
Österreich
0 100 200 300 400
1
10
34
45
49
69
78
99
108
110
149
Subsidy gain per hectare / €
Latvija
Romania
Eesti
Lietuva
Bulgaria
Portugal
Polska
España
Slovensko
Magyarország
Österreich
0 100 200 300 400
1
10
34
45
49
69
78
99
108
110
149
Subsidy gain per hectare / €
229
A flat rate for direct
payments would benefit
new member states but
presents big
political challenges
New member states get a
better deal from rural
development than from
direct payments
0
100
200
300
400
500
600
0 100 200 300
Dir
ect
Pay
me
nts
/ €
pe
r h
a
Rural Development / € per ha
0
100
200
300
400
500
600
0 100 200 300
Dir
ect
Pay
me
nts
/ €
pe
r h
a
Rural Development / € per ha
Poland
O
Entitlement approach
v. Programming
approach
