CAP, the devil is in the details

Political agreement has been reached on the new direction for the Common Agricultural Policy (CAP). The European Parliament, the EU Council of Ministers and the European Commission have reached an agreement on CAP post 2013.

“This agreement will lead to far-reaching changes, making direct payments fairer and greener, strengthening the position of farmers within the food production chain and making the CAP more efficient and more transparent,” said Dacian Cioloş, European Commissioner for Agriculture and Rural Development.

Here is a summary of the main points:

Direct payments are to be distributed in a fairer way between countries, regions and farmers, putting an end to ‘historical references’

* Convergence: the distribution of the CAP budget will ensure no single country receives less than 75 per cent of the community average by 2019.

* Divergences in the levels of aid will be reduced from one holding to the next: aid per hectare no less than 60 per cent of the average of the aid disbursed by 2019.

* Only farmers currently active may benefit from income-support schemes.

* Young farmers will be strongly encouraged to set up business, with the introduction of a 25 per cent aid supplement during the first five years

* Member states will be able to allocate increased amounts of aid to less-favoured areas. It will be possible to allocate coupled payments for a limited number of products, with a specific two per cent coupling for plant-based proteins, so as to make the EU less dependent on imports in this area.

The food production chain

* Professional and interprofessional organisations will be promoted, and, for certain sectors, there will be specific regulations on competition law (milk, beef, olive oil, cereals). Such organisations will be able to increase efficiency by negotiating sales agreements on behalf of their members.

* Sugar quotas will be abolished by 2017 and the organisation of the sugar sector will be strengthened on the basis of contracts and mandatory interprofessional agreements.

* The Commission will be able to temporarily authorise producers to manage the volumes placed on the market: provision of a crisis reserve (including a general emergency clause); and under rural development programmes, member states will be able to encourage farmers to take part in risk prevention mechanisms (income support schemes or mutual funds) and to devise sub-programmes deployed for sectors facing specific problems.

A greener CAP

Between 2014 and 2020, €100bn will be invested to help farming meet the challenges of soil and water quality, biodiversity and climate change:

* ‘Greening’ of 30 per cent of direct payments will be linked to three environmentally-friendly farming practices: crop diversification, maintaining permanent grassland and conserving 5 per cent, and later 7 per cent, of areas of ecological interest as from 2018 or measures considered to have at least equivalent environmental benefits.

* At least 30 per cent of the rural development programmes’ budget will have to be allocated to agri-environmental measures, support for organic farming or projects associated with environmentally friendly investment or innovation measures.

* Agri-environmental measures will be stepped up to complement greening practices. These programmes will have to set and meet higher environmental protection targets (guarantee against double funding).

A more efficient and transparent CAP

* The amount of funding to support research, innovation and knowledge-sharing will be doubled.

* Rural development programmes will be better co-ordinated with other European funds and the sector-based approach will be replaced by a more adaptable national or regional strategic approach.

*A simplified aid scheme for small farmers will be available to the member states that so desire.

* Details of all CAP aid will be made public, with the exception of the very small amounts allocated to small farmers.

All aspects of the reform will be applicable as from 1 January 2014, except for the new direct payments structure (‘green’ payments, additional support for young people, etc.) which will apply as from 2015 in order to give Member States time to inform farmers about the new CAP and to adapt computer-based CAP management systems.

Image Shuttlestock