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The Single Farm Payment: A Basic Income for Farmers?

Author

Listed:
  • O'donoghue Cathal

    (Teagasc Rural Economy and Development Programme Mellows Campus, Athenry County Galway Ireland)

  • Howley Peter

    (Environment Department University of York Heslington York, YO10 5DD United Kingdom)

Abstract

In 2004, the EU Common Agricultural Policy (CAP) was reformed so that payments to farmers were unrelated to agricultural production; the Single Farm Payment (SFP). The objective was to reduce the market distorting incentives of the CAP. Utilising the farm data we compared it to Basic Income (BI). While there are some similarities, the SFP is functionally quite different from a BI. They are both income transfers independent of production. However, the SFP is not a flat rate payment, but is based on historical production. Like a BI, its unconditionality facilitates a change to a more market-rational production system, but these effects are relatively low. Equity objectives are also quite dissimilar relative to a pure BI instrument. There is some environmental-related conditionality, so it is more akin to Atkinson’s participation income. Nevertheless, the SFP can be regarded as equivalent to a relatively strong transition or stepping stone to a BI.

Suggested Citation

  • O'donoghue Cathal & Howley Peter, 2012. "The Single Farm Payment: A Basic Income for Farmers?," Basic Income Studies, De Gruyter, vol. 7(1), pages 1-22, December.
    • Handle: RePEc:bpj:bistud:v:7:y:2012:i:1:p:1-22:n:2
    DOI: 10.1515/1932-0183.1196
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    References listed on IDEAS

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