Plans have been axed to slash the Common Agricultural Policy (CAP) budget by €500m (£442m). MEPs on the Agriculture committee rejected the amendments put forward by the European Council at a meeting on Tuesday. image expired

The Council's amendments called for massive cuts to subsidies received by farmers across Europe. As a result of Tuesday's vote the original draft budget will remain, at €60.15bn (£53.29bn).

Instead of going through with the budget cuts, the agriculture committee members proposed funding a series of pilot and research projects, including €1m towards an initiative to improve the accuracy of EID reading, €3m for a 'farm price observatory,' which would look at how price is distributed along the supply chain, and a further €1m to reducing European farmers' administrative burden.

The changes have been largely welcomed by the farming industry in the UK, which has expressed concerns over cross-compliance with IEDs in particular after, although regulation came into force on 1st January this year, there have been problems with its implementation in the UK.

The MEPs also voted to increase compensation payments destined for producers hit by the E.Coli outbreaks in May and June. The committee wanted to see €600m in aid going to affected farmers, whereas the council had sought to cut funds.

The after-effects of the E.Coli crisis, which was caused by sprouted fenugreek seeds, and its handling by politicians in Germany who first wrongly pinned the blame on Spanish fresh produce, then warned Germans against eating lettuce, tomatoes and cucumbers, are still the subject of much controversy. In France, disgruntled farmers have been destroying imported produce from Spainsh producers who, they say, are undercutting them in order to recoup losses incurred during the crisis.

The results of the Agriculture Committee's vote will now be fed into the overall parliamentary response to the 2012 budget and will be voted on in October, for adoption in December.