Westcountry landowner David Fursdon has warned that the Government is in danger of getting one of the most critical agricultural issues of the decade - the restructuring of farm payments - wrong.

Mr Fursdon, who farms at Cadbury, near Exeter, is the national deputy president of the Country Land and Business Association (CLA) which has presented its case for a credible farm payments system to the House of Commons Environment, Food and Rural Affairs Committee. He said that the CLA had put forward a compromise solution based on a hybrid of the options offered to the industry.

"Although the Government now appears to be going down the hybrid route, it is still in danger of choosing the wrong hybrid. This decision will affect the future of agriculture in this country for the foreseeable future and we want the Government to opt for the only system of farm payments that will ensure enough of the farming industry can continue to operate profitably."

The debate hinges on whether the new methods of farm payments should be calculated on a regionally averaged or historical basis. There would be losers if either option were to be adopted - the CLA's proposal seeks to mitigate the impact on the industry.

The CLA warns that opting for the wrong type of hybrid could see dynamic, market-facing and entrepreneurial farm businesses suffer. If the hybrid payment system is initially based on an historic distribution of payments, those farmers who have competitively expanded their businesses, moved into unsupported markets or grown novel crops will be hardest hit.

The CLA option, known as HARC - Historic for Animals, RAP (regional average payments) for Crops - immediately removes the uncertainty for this group of farmers in transition and it is, says Mr Fursdon, precisely this group the Government should be most worried about.

"Our system would dramatically reduce the redistribution of livestock payments that would result from a pure single RAP.

"It would significantly ease the feared loss or reduction of arable payments from the historic payments option for crop farmers who have been involved in farmland transfers in the last three years.

"Because payments are spread over all eligible land, it would also significantly reduce the likelihood of payment support disappearing off farmland as a result of entitlement transfers," he said.