Babiš feels the pinch as new Czech farm chief rewrites EU subsidy rules

BY EDDY WAX AND LILI BAYER

 

STRASBOURG — The Czech Republic's new conservative-led coalition government appears intent on making life less profitable for billionaire agribusiness titan Andrej Babiš, the country's former prime minister.

 

Babiš was hauled over the coals by lawmakers in Brussels when an EU audit found that while in office, he had improperly kept control of his food and farming conglomerate Agrofert, which received EU subsidies thanks to rules he helped to shape with his seat at the European Council.

 

Now the new Czech government wants to make it harder for large landowners like Babiš to mop up vast amounts of EU subsidies, with a new focus on diverting money in the Common Agricultural Policy to smaller-scale family farm businesses starting next year.

 

The Czech Republic is unusual because of the dominance of big farms — a legacy of collectivized agriculture under communism — meaning much of the farmland is concentrated in relatively few hands. This traditionally meant that Prague was an opponent of capping payments to big landowners and spreading more money to small farms.

 

The new government, however, is performing a U-turn. The new Czech CAP plan, submitted to Brussels on January 28 after the formal deadline, was the result of weeks of extra debating in Prague. It seeks to go even further than a new EU requirement to share out 10 percent of farm subsidies with smaller farms, and plans to redistribute 23 percent of farm subsidies.

 

"Mr. Babiš and his companies will not benefit from the new strategic plan," the country's new farm chief Zdeněk Nekula, told POLITICO at a meeting of EU ministers held under the French Council presidency on Tuesday.

 

Babiš, who did not reply to a request for comment, has always denied allegations that he had any kind of conflict of interest relating to Agrofert and has dismissed criticism as being purely politically motivated.

 

Nekula has an atypical profile among Europe's agriculture ministers, openly stating his desire to work closely with the Czech environment minister, and ramp up organic farming and support for smaller-scale farmers.

 

Still, the Czech Republic did not include full-blown capping in its draft plan. Only agri-environmental projects funded from the smaller of the two pots of CAP funding will face a form of capping, limiting their subsidies to a maximum of around €1.2 million.

 

Nekula said because of the high level of redistribution, capping was unnecessary: "There would be actually no sense in introducing the capping because there was already a great shift.

 

"The aim is to support the smaller farms, but the bigger ones will not go bankrupt. I think it’s scaremongering when somebody says ‘I think there will be something wrong, something bad,'" Nekula said.

 

Nekula is an amateur beekeeper who hails from the Czech People’s Party (KDU-ČSL), which is affiliated with the European People’s Party at the EU level.