CAP budget 'agreed' for the next 7 years

It was a historic start to the day this morning, Tuesday, July 21, with a significant breakthrough in budget negotiations in Brussels.

Earlier today, the budget for the Common Agricultural Policy (CAP) was announced for the next seven years by the European Council. A figure of €356.3 billion (please see the qualifier in the box below) has been allocated under the heading of ‘Natural Resources and Environment’.

Also Read: Table: How much CAP money is earmarked for farmers over the next 7 years?

While retaining Pillar I and Pillar II sub-headings (for CAP), a new delivery model brings both pillars under a single programming instrument – namely the CAP Strategic Plan.

It is outlined in the European Council’s document that commitments under the heading that encompasses agriculture and maritime policy, as well as environment and climate action, will not exceed €356.4 billion (in what the council refers to as ‘2018 prices’). Of this, €258.6 billion will be allocated to market-related expenditure and direct payments.

The document outlines an upper limit of €239.9 billion for direct payments under the CAP Strategic Plan Regulation.

A voluntary cap on direct payments, for “large beneficiaries”, will be introduced – at €100,000. It will apply only to the Basic Income Support for Sustainability (BISS).

When applying capping, member states may “subtract all labour-related costs from the amount of BISS per beneficiary”.

External convergence of direct payments will continue. The council has stated that it will “close the gap”. It explained: “All member states with direct payments [per hectare] below 90% of the EU average will close 50% of the gap between their current average direct payments and 90% of the EU average in six equal steps – starting in 2022”.

This will be “financed proportionately by all member states”.

Additionally, all member states “will have a level of at least €200/ha in 2022”. The document goes on to say that all member states “shall reach at least €215/ha by 2027”.

The share of CAP expenditure that is expected to be dedicated to climate action is 40%.