We're all Paying for Europe's Gift to our Aristocrats and Utility Companies
What would you do with £245? Would you: a) use it to buy food for the next five weeks; b) put it towards a family holiday; c) use it to double your annual savings; or d) give it to the Duke of Westminster?
Let me make the case for option D. This year the duke was plunged into relative poverty. Relative, that is, to the three parvenus who have displaced him from the top of the UK rich list. (Admittedly he's not so badly off in absolute terms: the value of his properties rose last year, to £7bn.) He's the highest ranked of the British-born people on the list, and we surely have a patriotic duty to keep him there. And he's a splendid example of British enterprise, being enterprising enough to have inherited his land and income from his father.
Well there must be a reason, mustn't there? Why else would households be paying this money – equivalent to five weeks' average spending on food and almost their average annual savings (£296) – to some of the richest men and women in the UK? Why else would this 21st-century tithe, this back-to-front Robin Hood tax, be levied?
I'm talking about the payments we make to Big Farmer through the common agricultural policy. They swallow €55bn (£47bn) a year, or 43% of the European budget. Despite the spending crisis raging through Europe, the policy remains intact. Worse, governments intend to sustain this level of spending throughout the next budget period, from 2014-2020.
Of all perverse public spending in the rich nations, farm subsidies must be among the most regressive. In the EU you are paid according to the size of your lands: the greater the area, the more you get. Except in Spain, nowhere is the subsidy system more unjust than in the UK. According to Kevin Cahill, author of Who Owns Britain, 69% of the land here is owned by 0.6% of the population. It is this group that takes the major payouts. The entire budget, according to the government's database, is shared between just 16,000 people or businesses. Let me give you some examples, beginning with a few old friends.
As chairman of Northern Rock, Matt Ridley oversaw the first run on a British bank since 1878, and helped precipitate the economic crisis that has impoverished so many. This champion of free market economics and his family received £205,000 from the taxpayer last year for owning their appropriately named Blagdon estate. That falls a little shy of the public beneficence extended to Prince Bandar, the Saudi Arabian fixer at the centre of the Al-Yamamah corruption scandal. In 2007 the Guardian discovered that he had received a payment of up to £1bn from the weapons manufacturer BAE. He used his hard-earned wealth to buy the Glympton estate in Oxfordshire. For this public service we pay him £270,000 a year. Much obliged to you guv'nor, I'm sure.
But it's the true captains of British enterprise – the aristocrats and the utility companies, equally deserving of their good fortune – who really clean up. The Duke of Devonshire gets £390,000, the Duke of Buccleuch £405,000, the Earl of Plymouth £560,000, the Earl of Moray £770,000, the Duke of Westminster £820,000. The Vestey family takes £1.2m. You'll be pleased to hear that the previous owner of their Thurlow estate – Edmund Vestey, who died in 2008 – managed his tax affairs so efficiently that in one year his businesses paid just £10. Asked to comment on his contribution to the public good, he explained: "We're all tax dodgers, aren't we?"
British households, who try so hard to keep the water companies in the style to which they're accustomed, have been blessed with another means of supporting this deserving cause. Yorkshire Water takes £290,000 in farm subsidies, Welsh Water £330,000, Severn Trent £650,000, United Utilities £1.3m. Serco, one of the largest recipients of another form of corporate welfare – the private finance initiative – gets a further £2m for owning farmland.
Among the top blaggers are some voluntary bodies. The RSPB gets £4.8m, the National Trust £8m, the various wildlife trusts a total of £8.5m. I don't have a problem with these bodies receiving public money. I do have a problem with their receipt of public money through a channel as undemocratic and unaccountable as this. I have an even bigger problem with their use of money with these strings attached. For the past year, while researching my book about rewilding, I've been puzzling over why these bodies fetishise degraded farmland ecosystems and are so reluctant to allow their estates to revert to nature. Now it seems obvious. To receive these subsidies, you must farm the land.
As for the biggest beneficiary, it is shrouded in mystery. It's a company based in France called Syral UK Ltd. Its website describes it as a producer of industrial starch, alcohol and proteins, but says nothing about owning or farming any land. Yet it receives £18.7m from the taxpayer. It has not yet answered my questions about how this has happened, but my guess is that the money might take the form of export subsidies: the kind of payments that have done so much to damage the livelihoods of poor farmers in the developing world.
In one respect the government of this country has got it right. It has lobbied the European commission, so far unsuccessfully, for "a very substantial cut to the CAP budget". But hold the enthusiasm. It has also demanded that the EC drop the only sensible proposal in the draft now being negotiated by member states: that there should be a limit to the amount a landowner can receive. Our government warns that capping the payments "would impede consolidation" of landholdings. It seems that 0.6% of the population owning 69% of the land isn't inequitable enough.
If subsidies have any remaining purpose it is surely to protect the smallest, most vulnerable farmers. The UK's proposals would ensure that the budget continues to be hogged by the biggest landlords. As for payments for protecting the environment, this looks to me like the option you're left with when you refuse to regulate. The rest of us don't get paid for not mugging old ladies. Why should farmers be paid for not trashing the biosphere? Why should they not be legally bound to protect it, as other businesses are?
In the midst of economic crisis, European governments intend to keep the ultra-rich in vintage port and racehorses at least until 2020. While inflicting the harshest of free market economics upon everyone else, they will oblige us to support a parasitic class of tax avoiders and hedgerow-grubbers, who engorge themselves on the benefactions of the poor.