The Common Agricultural Policy (CAP) makes up a huge proportion of the EU’s budget, currently around 40 percent. It is controversial in the UK and often highlighted by pro-Brexit campaigners because the British pay far more into CAP than they get out, and there are accusations that the policy contributes to environmental degradation. In 2014, France was the top gross benefactor raking in CAP payments worth around £7.3billion, with Spain and Germany next.
The net winners – ie. who gets out more than they put in – were Poland, Greece and Spain.
Meanwhile the UK was the third biggest net loser of the whole EU28.
Farm subsidies have caused divisions in Europe for years, and was a big sticking point when the EU was deciding to expand from 15 countries to 25 – which took place in 2004.
According to an article in The Guardian on June 3, 2002, a ‘Northern Alliance’ in the EU including the UK was refusing to guarantee direct payments of farm subsidies to new members.
France was backing the pro-subsidy group and Spain was also reportedly “sniping” at the the northern countries.
Ian Black wrote: “Spain, now on the home stretch of its lackluster presidency, is leading the sniping at the northerners.
“It’s a bit rich – though perfectly ordinary European politics – when you consider that Jose Maria Aznar, Tony Blair’s best EU mate invariably goes for the cajones in defending Madrid’s regional and farming subsidies and has just played havoc with long-overdue attempts to reform fisheries policy.
“‘Alarming and hypocritical’ was the off-the-record but unusually quotable response not a million miles away from the UK mission.”
Joining the UK in the ‘Northern Alliance’ was Germany, the Netherlands and Sweden who wanted to hold off on the subsidies for new members.
Unsurprisingly, in 2014 it was Germany and the Netherlands who took the top spots for contributing more to CAP than they get out.
The 2002 Guardian article called the farm subsidy row a “serious split” and “bad news”.
Even France, while backing subsidies, also suggested a catch that direct payments for newcomers would be phased in over 10 years and at just 25 percent of the grant to existing members.
After the UK leaves the EU, the Government plans to introduce a seven-year transition period for farmers’ funding from 2021.
During these seven years, direct payments from the state will be reduced and tied more closely to delivering environmental and other “public” goods, according to the Financial Times.