Twitter and Facebook this week have been highlighting a house in West Belfast with a Christmas tree and lights in the garden.
A resplendent tree it certainly is – but the middle of October is nonetheless a bit early to be getting into the Christmas mood. However farmers received a nice early Christmas present this week, in the shape of a reduction in the financial discipline penalty on single payments. This was initially to be close to five per cent, then the figure moved to around 4.5, per cent, but now the final figure has been cut to 2.45 per cent. This is because the overspend of the CAP budget will be 903 million euro rather than the 1.5 billion originally forecast.
This may not sound a lot – and at the end of the day a cut is still a cut. However direct payments will be increasing by around 5 per cent because of the euro to sterling conversion figure. With financial discipline at 2.45 per cent that will still be a net gain of around 2.5 per cent – and in today’s tough financial climate a lot of people in 9 to 5 jobs would be delighted with a pay increase that almost matches inflation. On those grounds, early as it may be, this is a welcome Christmas bonus on single farm payment cheques that should be going out in December.
Inevitably in Brussels good news is offset by less positive events. That comes in the shape of a blow to something farmers have wanted for a long time, and which they believed was on its way. This is the extension beyond beef of country of origin labelling, dubbed COOL. The need for this was given a boost when farm lobby groups from Europe and North America discussed trade issues when they met last week in Mexico. These underlined that trade goes beyond the basic issue of price, with European environmental and welfare standards very different to those elsewhere. On that basis it is only fair that farmers delivering the higher standards should be rewarded for them, and that means consumers knowing the origin of products.
COOL moved up the Brussels agenda in the wake of the horsemeat scandal. There was a growing confidence that legislation would be in place next year. The UK government has always been a rallying point against this plan, claiming it represented additional red tape for food companies, because it would restrict their ability to source ingredients where they wanted. There are also claims that COOL is difficult to police when batches of product are combined for ready meal type products. However the horsemeat scandal proved that those who had good traceability standards could stand over mince used in burgers – not down to the individual animal but to the day and the herd numbers of cattle from which it was produced.
Now in a surprise move a report prepared by the European Commission has undermined the thinking behind COOL, deeming it potentially costly and cumbersome for food companies. This has to be music to the ears of the food industry, which lobbies against any labelling regulations. It will also be applauded by the UK government, as many will view it as no coincidence that the report was leaked at a crucial stage of the negotiations. It claims costs could rise for food manufacturers by between 5 and 15 per cent. This is because they would have to source EU origin ingredients, because anything else would not look good to consumers. In an amazing leap of economic logic the report then concludes that since prices would have to increase on the supermarket shelf demand would fall, meaning the COOL plan would have a negative impact on the meat industry.
The report then gilds the lily by making much of additional inspection costs if the legislation were in place, and its conclusion is that COOL is a bad idea. While what has emerged are leaks of the report it certainly seems to have been heavily influenced by the food industry, with the views of farmers and others pressing for COOL largely ignored. The commissioner responsible, the food safety commissioner Tonio Borg, says he has an open mind on this issue. One way to show that would be to take this report as a first draft – and to tell those who prepared it to think again, and not to be so influenced by the arguments of the food industry’s lobbyists.