Annex D
LEGITIMACY OF
"GREEN BOX"
PAYMENTS: IMPORTANT
CAVEATS TO
ENSURE ENVIRONMENTAL
PROTECTION
1. Some countries are calling for explicit
proof of societal value to cross-check the scale of environmental
payments. We would caution that while such approaches have merit
in principle, economic valuation of biodiversity is technically
fraught, that sustainable development principles go beyond the
economic value given by the current generation. The best measure
of "value" is this country's commitment to biodiversity
protection as agreed in the Biodiversity Action Plan.
2. Some are arguing that environmental payments
will only be legitimate if very tightly specified and focussed
on environmental outcomes. We support such an approach in principle
but warn that it is not feasible for the whole programme to be
specified in this way because of problems relating to the landscape
scale dependency of environmental benefits, transaction costs,
burden of risk problems and scientific specification problems.
The rules must allow for some elements to be related to a "looser"
specification based on agricultural inputs.
3. The above point means that the Government
should not support any agreements which discount legitimate payments
simply because they specify a particular type of agricultural
process.
4. Because of the joint product issues discussed
above, legitimate environmental payments must be allowed even
where they have indirect effects on production levels.
5. The "legitimacy" rules must
allow environmental payments to cover the cost to farmers of producing
the environmental benefits and, where necessary to achieve the
environmental benefits cost effectively, the cost of keeping vulnerable
farmers in farming. Either the green box rules (annex 2, paragraphs
1 and 6) or amended blue box rules must allow for such payments.
The legitimacy of such payments at the necessary scale could be
constrained by the current trade distortion rule (annex 2, paragraph
1) and the type of production rule (annex 2, paragraph 6). In
addition, annex 2, paragraph 6 needs to allow legitimate payments
(for example, based on historic area) which may have some indirect
effect on production levels.
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