Mr Brown's remarks came during a one-day conference held by the government to canvas the views of farmers and environmental groups as European farm ministers enter the final stage of negotiations for the reform of the EU's Common Agricultural Policy (CAP).

Nick Brown: Favours gradual reform

Reform of the CAP, which is the single largest item on the EU's budget accounting for over 50% of total spending, has long been needed, Mr Brown said.

"The present structures actually build in the creation of surpluses for some products," he said.

"It doesn't represent good value for consumers as it keeps prices artificially high, it doesn't represent good value for the taxpayer as the subsidy scheme is a drain on resources nor is it good for farmers as it keeps them out of certain markets."

In order to ensure farmers' views are heard during the EU negotiations a questionnaire will be sent to every UK farmer asking them how best the EU should finance any new policy.

At present the government prefers the reduction of state aid to farmers, who would be offered compensation payments instead. Compensation would then be reduced over time.

But Mr Brown added that he had witnessed the sobering effects of total withdrawal of financial support in the steel and coal industries and did not wish to inflict this on farmers.

EU farm ministers are hoping to agree to a new policy by March.

The deputy president of the National Farmers' Union, Tony Pexton, rejected charges that too much European money was being spent on agriculture.

Speaking on BBC News 24 he said: "Agriculture doesn't only provide food, we also have a very important social function in the countryside.

"Agriculture is really the cornerstone of economic activity in the countryside throughout Europe, so there is a social function there."

Mr Pexton hoped that money could be diverted from supporting produce to supporting social and environmental aspects of agriculture.

He added that emphasis must be place on making sure that Europe's farmers are not, "held back from competing in the world market".

Pork gets stamp of approval

Earlier Mr Brown lent his support to struggling UK pig farmers who are to receive government help to stave off the collapse of their industry.

Government backs British pork

Mr Brown unveiled a new scheme aimed at persuading shoppers to buy British pork, identified by the introduction of a new quality mark.

He said: "I would urge consumers to look carefully when purchasing pork products in the marketplace for this standard and emblem.

"But it would be wrong for me to hold out the prospect of some state aid through CAP to the pig industry."

Under regulations introduced at the beginning of the year UK pig producers have stopped using the stall and tether system of production seven years before the rest of Europe.

British pigs are also not feed meat or bone meal.

But the new higher standards and the continued strength of the pound mean British farmers are losing out to foreign competitors.

Over �180m of foreign pork was imported last year and some British farmers are losing as much as �30 on each pig they produce.