The EU Dairy Fund will soon distribute more than £26 million to British dairy farmers.
The £273 million EU Dairy Fund is intended to help farmers who have been severely affected by changes in demand and prices over the last year, while keeping administrative costs to a minimum and supporting a competitive dairy sector.
Following consultation with the industry, the UK Government and Devolved Administrations have agreed to distribute the UK share of the fund by making a flat rate payment to farmers of roughly 0.2 pence per litre of the milk they produced between October 2008 and September 2009.
Farming Minister Jim Fitzpatrick said, “We’ve agreed with the industry that a flat rate payment is the fairest way to help dairy farmers most affected by the drop in global dairy prices.
“The UK has one of the most modern and efficient dairy sectors, and distributing the funding in this way will give some additional security to farmers following a particularly challenging year.”
To keep administrative costs as low as possible, the qualifying threshold for payments will be 50,000 litres, which means that the minimum payment from the fund will be roughly £100. The Rural Payments Agency aims to begin making payments in mid-April, with all payments to be made by the end of June.
The overwhelming response from the consultation run earlier this year agreed that the flat rate payment model was the fairest system for distribution of the fund across the UK.