The European Commission has drawn up plans for the biggest shake-up of agricultural policy in its 40-year history, ending the link between production and subsidies, a draft of the plans showed today.
The Commission will propose flat-rate aids to farmers based on historical payments, cut grain prices by another five percent and require them to take 10 per cent of their land out of production altogether, the draft, seen by Reuters, said.
EU Farm Commissioner Mr Franz Fischler believes that, if agreed, the shake-up will prepare the bloc to admit up to 10 new members, mostly in eastern Europe, and strengthen its hand at world trade talks.
How fast the new joiners win access to the EU's €40 billion annual farm budget - half of all EU expenditure - is one of the trickiest issues unresolved in the enlargement process.
In addition, the Commission plans to scale back direct aids to large-scale farmers by three percent a year for the next seven years and switch the money into rural development.
In the wake of a wave of food and animal scares such mad cow and foot-and-mouth disease, farmers will also have to comply with tougher environmental, food safety and animal welfare standards to receive payments.
Mr Fischler is due to unveil his plans officially on July 10th, but at a meeting of EU Farm Ministers in Luxembourg today it was clear that not all governments would support the radical move.