Farmers will lose most state subsidies 'within 10 years'

Farmers will lose most government subsidies for food production within a decade, the Environment minister Lord Whitty announced yesterday.

He urged them to adapt to conditions caused by the foot-and-mouth epidemic, signalling support for agriculture would, in future, be directed more at looking after the countryside.

Lord Whitty strongly denied the Government wanted to use foot-and-mouth as an excuse for closing down much of the farming sector. "The reality is that this Government is fully committed to a viable, vibrant and sustainable British agricultural sector, containing both livestock and arable farms."

But he said the present subsidy system, under which farmers receive more taxpayers' money than all other industries combined, could not continue. Lord Whitty told the Mid-Somerset Show at Shepton Mallet: "Make no mistake, the vast sums of public money pumped into farming every year are not going to continue.

"Market support and direct payments are blunt, inefficient instruments which constrain farmers from reacting positively to market pressures."

Lord Whitty also called for an overhaul of the European Union's £25bn-a-year Common Agricultural Policy. Changes could include removing artificial incentives that have encouraged more intensive agriculture and a strategy to direct aid at rural, environmental and structural improvements, to make the countryside more sustainable.

"It also includes a better deal for consumers, whose shopping bill reflects the higher agricultural prices in the EU when compared with the world market," he said.

A new approach to state help for farming was also suggested yesterday by the Government's rural recovery co-ordinator for Cumbria, Lord Haskins. He told Breakfast with Frost on BBC1: "In the future maybe farmers shouldn't be paid to produce food that nobody wants. Instead, they should be paid to produce a countryside that everybody wants."