Central European governments have been systematically abusing the European Union’s Common Agricultural Policy to enrich family members and political allies, an investigation claims. The
New York Times survey of subsidies in nine European countries found that millions of euros in agricultural subsidies had been directed to a handful of companies, often linked to national leaders. It alleged that the CAP had even underwritten “mafia-style land grabs” in Slovakia and Bulgaria. Prominent beneficiaries reportedly include Andrej Babis, the billionaire prime minister of the Czech republic, who the paper says is linked to a company that received at least $42 million (£32 million) in subsidies last year. Lukáš Wagenknecht, a senator from the opposition Pirate Party, last week filed a complaint against the European Council saying it should not allow Mr Babis to take part in the bloc’s budget discussions because his Agrofert conglomerate receives tens of millions of Euros in subsidies annually. Mr Babis no longer owns the company and has denied a conflict of interests, but organisations including Transparency International claim that he remains its end beneficiary. Andrej Babis, the Czech prime minister, denies a conflict of interest Credit: Martin Divisek/Bloomberg The paper also accused Viktor Orban, the prime minister of Hungary, of abusing the EU’s subsidies to fund a system of patronage linked to land leases. It cited Mr Orban’s sale of 12 state farms to close associates when he was prime minister between 1998 and 2002, which became eligible for large subsidies when Hungary joined the EU in 2004. In 2015, five years after he returned to power, Mr Orban’s government began to sell and auction leases to hundreds of thousands of hectares at cut price rates, arranging for most of them go to businessmen with close connections of Fidesz. The paper implies that this created a system of “modern feudalism” in which small farmers were left beholden to barons who received land eligible for European subsidies based on their loyalty to Mr Orban. Individuals who are reported to have built up considerable landholdings include Mr Orbans family and close business and political allies. The
European Union supported farmers with 58.82 billion Euros (£50.8 billion) in 2018. Subsidies are meant to support food production, rural community development, and environmentally friendly farming. The subsidies it provides are often crucial to the survival of small farmers across the bloc. Ivan Haralampiev, the Bulgarian farmer whose cow Penka was at the centre of an outcry over EU agricultural regulations in 2018, told the Telegraph that he had bought cattle only because the subsidies they qualified for made it possible to live. The Telegraph sought comment from Mr Orban's office. A spokesman for the Hungarian government said: “The procedures in Hungary for administering EU agricultural subsidies fully satisfy EU rules and regulations for the management of these funds. Hungary is also fully compliant in the sale of state land, which is regulated by law. Furthermore, it should be noted, that concerning a plot of land larger than 1,000 hectares, subsidies for or sale of that plot must follow strict rules. The NYT’s questions and sources clearly reflect a biased preconception about the topic.”