REFORMS of the Common Agricultural Policy mean it is now possible to trade "entitlements" to the new single farm payment.
Currently £450 million of subsidy goes into the farming industry each year. Its allocation is based on farming activity in the qualifying years of 2000-3.
Those who have moved out of farming recently, the so-called slipper brigade, can sell t
heir entitlements. They can be bought by other farmers who wish to beef up their support income or they can attract the attention of financial speculators.
In an analysis of entitlement trading over the past year, property services firm Savills has concluded that the return for those investing in entitlements has been about 20 per cent, but that has been largely boosted by the current strength of the euro.
One area of entitlement trading that is now closing down relates to payments for set-aside land. From next year, there will be no set-aside in Europe, but for those who bought last year, Savills reckons the capital value of these rights had been boosted.
There is one slightly good piece of news for taxpayers who may not understand just how this particular piece of financial manoeuvring has much to do with the profitability or otherwise of farming.
That is a promise by the European Commissioner for agriculture to perform a "health check" on the reform of farming policy, the conclusions of which are due later this month.
If nothing changes at this point, there will probably be a gradual run-down in trading of entitlements and profitability in the run-up to the next major shift of policies in the Cap, which comes in 2013.
The full article contains 282 words and appears in The Scotsman newspaper.
