A6 LFA annex.pdf - Agra CEAS Consulting

MID-TERM EVALUATION OF THE RDP WALESA6.6. National questionsThe methodology for addressing the national questions was the same as that used for theCommission questions (i.e. secondary data and a telephone survey of Tir Mynydd participants). Inaddition the evidence from the focus groups is interesting in one particular respect. Whenparticipants were asked about the various schemes within the RDP, there was virtually no mention ofthe Tir Mynydd scheme. Only in one area (Rhayader) was there ‘some awareness’ of the scheme.This suggests that LFA payments have been in place for so long and are so universal within therelevant area (in itself some 77% of the total Welsh agricultural area) that they have become takenfor granted and are in effect seen implicitly as a form of social security support, divorced from widerrural development policy. This would seem to have implications for the interpretation of surveyresults in particular since it follows that it is often difficult to link specific changes, developments,opinions, and so on, to the Tir Mynydd payments in the way, for example, that environmentaloutputs can be more closely linked to Tir Gofal payments.A6.6.1. Is there a valid economic rationale for the Tir Mynydd scheme?Tir Mynydd effectively provides an income supplement to the generally low farm incomes found inrural Wales. However, LFA designation has undoubtedly been influenced within a political process asmuch as being based on any objective criteria and it is clear that the Tir Mynydd scheme is seen bypoliticians, bureaucrats and farmers themselves as a necessary general investment in a variety ofoutputs from the rural community. There is likely therefore to be relatively little concern as towhether there is sufficiently sensitive economic rationale for providing particular levels of assistanceto farmers within the current LFA.It follows that there is a prima facie issue about the existence of over-compensation. It is certainlylikely that the conditions facing LFA farmers change continuously across the LFA area from the non-LFA border to the DA/SDA border and therefore there will be some farmers under-compensatedand some over-compensated for the disadvantages they face. However, it is interesting to note thatrespondents in the DA generally receive a lower proportion of their total household income fromTir Mynydd compared to those in the SDA (mean 16% c.f. 27%) as Figure A6.3 shows. This suggeststhat the relative importance of Tir Mynydd payments for household income is broadly being directedwhere there is greater need (i.e. in the SDA area), and that farmers in less difficult LFA areas are lesslikely to have been over compensated. Whilst this evidence does not demonstrate an absence ofover or under-compensation, it certainly does not provide evidence for it.24