How Billionaires Are Cashing In on EU Farm Policy

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UK (Commonwealth) _The European Union (EU) has provided substantial farming subsidies to the businesses of over a dozen billionaires between 2018 and 2021, including those owned by British businessman Sir James Dyson and former Czech prime minister Andrej BabiÅ”.

According to an examination of official but ambiguous data from EU member states, billionaires were the “ultimate beneficiaries” of ā‚¬3.3 billion (Ā£2.76 billion) in EU farming payments over the four-year period, despite the closure of thousands of small farms.

Forbes’ 2022 rich list lists 17 “ultimate beneficiaries,” including Guangchang Guo, a Chinese investor who owns Wolverhampton Wanderers football club; Dyson, a British vacuum cleaner tycoon; and Babi, the former Czech prime minister cleared in February of fraud involving farming subsidies.

Kjeld Kirk Kristiansen, the Danish toymaker and former CEO of Lego; Anders Holch Povlsen, the Danish rewilding enthusiast and private landowner in the UK; and Clemens Tƶnnies, the German meat tycoon, are among the other billionaire recipients of EU taxpayer funds.

BenoĆ®t Biteau, a French organic farmer and Green MEP in the previous European parliament, called it “madness.” “The great majority of farmers are having difficulty earning a living.”

Through its common agricultural policy (Cap), the EU distributes one-third of its total budget to farmers. The allocation of funds is determined by a farmer’s land area rather than if they require assistance.

However, due to stringent privacy regulations, lax transparency standards, and intricate ownership structures, examining who receives the funding has proven to be challenging. In a 2021 study, the fiscal control committee of the European parliament commissioned researchers from the Centre for European Policy Studies (Ceps) who concluded that it is “currently de facto impossible” to confidently determine who will ultimately benefit the most from EU money.

The researchers used a commercial database of businesses and information on agriculture subsidy recipients from each member state to create the best approximation possible. In order to determine the “ultimate beneficiaries,” they worked backwards from the recipients, identifying individuals who held at least 25% of a business at every stage of the ownership chain.

In certain instances, the money went to regional organizations that redistributed it, making it impossible for the researchers to track it down.

According to Damir Gojsic, a financial markets researcher who co-wrote the Ceps report and revised the analysis for the Guardian, the analysis examined the last natural person at the end of a chain of businesses. “You should ideally concentrate on millionaires, but there isn’t a list of them available.”

Over the course of four years, Gojsic discovered that 17 millionaires had benefitted from EU farming bailouts through businesses they owned entirely or in part. He claimed that, although the entire amount of money associated with the billionaires was ā‚¬3.3 billion, the web of businesses was too intricate and ambiguous to weight the sums according to their ownership positions.

The “perverse incentives” in the Cap that encourage farmers to degrade the environment have drawn criticism from scientists. They estimate that between 50 and 80 percent of EU farming subsidies go to animal agriculture, rather than crops that could improve human and environmental health.

Paul Behrens, a global change researcher at Leiden University who was not part of the study, stated that subsidies are the largest economic lever for change and that we need to make a quick shift to healthier foods for a healthier future.

“The disparity in the Cap is severe, and this study demonstrates once more how the wealthiest landowners continue to benefit from subsidies,” he stated. Despite the Cap’s increasing transparency over time, uncovering the public’s tax expenditures still requires a significant amount of investigative work.

Thomas Dosch, the manager of public affairs at Tƶnnies, stated that the corporation supported a “reorientation” of European agricultural policy to compensate farmers who used ecologically friendly farming practices for their income loss. “No area premiums per hectare or subsidies for product quantity should be paid,” he stated.

He noted that imposing large charges as a sanction for environmentally hazardous behavior would be an additional option. “However, I think this would be politically unacceptable if it resulted in significantly higher food prices and possibly even food shortages.”

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