Resources

Direct payments were introduced during the CAP reform of 1992, allowing a transition from the earlier production-oriented CAP toward policies intended to promote rural restructuring and the positive externalities that can result from farm-related activities. Direct payments introduced in 1992, as farm income support instruments, were subsidies per hectare of crops or per head of animal.

A study by the Canadian think-tank The Fraser Institute has found that industrial electricity consumers in the Province of Ontario have not become more responsive to prices since the wholesale market was opened in 2002. The study, which updates an analysis done in 2003, reveals that most industrial electricity consumers did not reduce consumption when wholesale prices rose.

The United States Government Accountability Office (GAO) has found that native grassland continues to decline in the U.S., particularly in South Dakota where relatively high subsidies are offered to farmers who convert grassland to cropland. The GAO says analysis shows that farm program payments are an important factor in whether grassland is converted to grow crops.

Last month the Global Subsidies Initiative of the International Institute for Sustainable Development issued its report on subsidies to biofuels in selected OECD countries (Australia, Canada, the European Union, Switzerland, the United States). The report arrives at a time of tremendous growth in biofuels production and consumption.

A study released last month by the United Nation's Economic Commission for Latin America (ECLA) found that subsidies will be required to establish large-scale production of biodiesel in Central America. The study, entitle "Perspectives for Biodiesel in Central America" was conducted by biofuels specialist Waldyr Luiz Ribeiro Gallo, of Brazil.

The Washington-based Worldwatch Institute touts the benefits of the global boom in biofuels for the rural poor in a book released last month.   "Biofuels for Transport: Global Potential and Implications for Energy and Agriculture", says higher prices for agricultural commodities will benefit more of the world's poor than it harms.

The United States Government Accountability Office (GOA) has found that the U.S. Department of Agriculture (USDA) is paying millions of dollars in farms subsidies to thousands of deceased individuals. The GOA report, issued in July, states that the USDA is not effectively reviewing farm subsidy recipients to ensure that they are eligible for payments.