Retailers are real beneficiaries - Support for farm incomes

THOUSANDS of farmers protested in Brussels yesterday as the EU announced it will release €500m to help those hit by plunging farm-gate prices. 

The EU spends more than €50bn a year to support farming through the Common Agricultural Policy. This accounts for roughly 40% of the EU’s budget.

Farm protests over incomes are nothing new, neither is the increasingly unsustainable idea that governments — taxpayers — should bail out this particular sector while other businesses are left to their fate. Farmers insist that they cannot continue to feed the world if they are paid less than production costs for their produce and this is entirely understandable and reasonable.

Europeans have enjoyed a cheap food policy for generations and have happily supported farmers through subsidies and tolerated a below-par contribution to the exchequer and the funding of vital social services in return.

However, the time has come to reappraise this model as it does not seem to be working. The reality is that the €500m package, a large proportion of the CAP’s €50bn, is a taxpayer-funded subsidy to the giant retailers setting the prices for farm produce. Some of these extremely profitable retailers are already subsidised by governments who pay income supplements to staff who are not paid a living wage. This is another example of corporate power that must be confronted with a new kind of resolve. Social equity demands it.