Control over subsidies for olive farmers causes conflict

State refuses to pay oil producers in full for their output

The conflict between olive oil producers and the State, which erupted this week with producers blockading the Athens-Patras national highway for two days, is part of a series of problems regarding agricultural subsidies.

The most obvious is the problem of excess production — or excess declared production — exceeding norms set by the European Union. The EU, especially in recent years, has punished excess production by cutting down on subsidies.

The conflict with the oil producers in the Aigion area partly had to do with excess production. They had declared a total production of 605,000 tons, but the State declared only 458,000 tons to the EU in order to obtain the maximum in subsidies for the producers. They, in turn, demand to be subsidized for the total amount they declared.

There is nothing the State can do to subsidize all of the production, since it would violate current EU rules. The farmers themselves are using pressure tactics to oblige the State either to renegotiate the amount of subsidy with the EU, a very difficult proposition, or come up with the money in some form. They do not care whether the payments they receive are legal or not, as long as they get them. Producers can usually count on the backing of at least the left-wing parties as well as local officials from both major parties.

Communist Party General Secretary Aleka Papariga declared that the producers only claimed what they are owed, while Left Coalition Synaspismos President Nikos Constantopoulos accused the government of using riot police to clear the highway.

In the Aigion farmers’ case, the State had proposed paying the producers for 60 percent of their declared amount and letting them appeal for the rest. The producers refused the compromise, hence the blockade.

The blockade was cleared yesterday afternoon through an agreement which already appears to be fragile. According to its terms, 450 producers would be subsidized for the totality of their production and the other 2,500 for 60 percent. The latter would be audited again over their production levels.

Another issue emerging from the conflict is who does the monitoring for agricultural production and, therefore, who decides on the farmers’ subsidies.

The Agriculture Ministry has handed over the task to the Panhellenic Confederation of Unions of Agricultural Cooperatives (PASEGES) which is mostly dominated by officials close to the ruling party. The decision has come under criticism, no less by professional agronomists, whose federation has protested to the ministry.

The ministry itself controls the organization that receives the subsidies from the EU’s guarantee fund and pays them to the farmers. The agronomists said handing over the monitoring to PASEGES violates a ministerial decision taken last year.