The CLA in the Midlands says that Defra's consultation on the Common Agricultural Policy (CAP) may hinder agricultural development with the announcement that potentially 15 percent of farmers' direct payments may be transferred to fund rural development under 'modulation', limiting their ability to invest in food production.
CLA Midlands Rural Adviser Donna Tavernor said: "As agriculture struggles to feed a growing world, food production has by necessity become a global market. To remove the maximum permitted amount of 15 percent from food production will put English farmers at a significant disadvantage to their European neighbours, who may even benefit by switching funds from rural development to direct payments.
"This announcement fails to recognise that agriculture underpins the rural economy and taking money away from this sector will restrict its ability to become more efficient through greater investment. UK agriculture is subject to the vagaries of the seasons and ever-changing weather, and farm payments help smooth out the peaks and troughs of production for everyone's benefit.
"The government seeks to provide much needed growth in the rural economy but the impact of modulating at the full rate will achieve the exact reverse."
The Defra consultation, announced on 31 October 2013, can be found at https://consult.defra.gov.uk/agricultural-policy/cap-consultation