THE National Beef Association has told Defra that immediate allocation of decoupled entitlement to farmers through anything other than a purely historic qualification route will be the biggest agricultural mistake made by a Labour government in living memory.

It has also warned that if it does not reconsider its plans to use a hybrid system to fix decoupled subsidy payments from January 2005 it will provoke a feeling of deep betrayal among farmers, many of them in the South West.

Until now they have accepted Defra's post-CAP reform ambitions because they understood entitlement would be allocated on the basis of historic coupled subsidy payments received over the 2000-2002 base years.

According to the NBA plans, which could include the arable sector being immediately hit with 100 per cent area, or flat rate average, payments and the livestock sector setting off with a 25 per cent area allocation that would increase to 100 per cent over a number of years, are being considered by Lord Whitty, Minister for Food and Farming.

"We are struggling to understand why Defra has embarked on a late review which unexpectedly puts the industry under threat of having averaged entitlement payments forced on it immediately after CAP reform is adopted," said NBA national chairman, Robert Robinson.

"We accept there will eventually be a time, perhaps in ten years, when area allocation is adopted but if it introduces any flat rate element into post-January 2005 entitlement allocation it will make it even harder for beef farmers to adjust their businesses to decoupling in the difficult start-up period."

The decoupled payments they would receive through historic allocation would be stripped back by up to 35 per cent as a result flat rate re-distribution, he added.

If that happened many beef farmers who would be able to meet the decoupling challenge if they were helped by the security of historic payments, would say that the lower payment per hectare forced on them by flat rate would make it impossible for them to start.

The minister is well aware of environmental and landowning groups with opposing views but NBA members are pleased that many farmer based organisations, including the TFA, are holding the historic payment line.

"The environmentalists are saying that historic allocation favours intensive farmers but are ignoring its impact on marginal land farms and all holdings which rent in land - including grass lets," said Mr Robinson.

If any area based allocation was included in livestock entitlement it would prevent stock owners, who had acquired entitlement through rented ground they used in the base years, from triggering it. All rented land would carry an area entitlement of its own and there would be no naked land to move their entitlement on to.