La PAC et développement rural[en] 

A new policy for rural development was introduced as the second pillar of the EU Common Agricultural Policy (CAP) in the framework of Agenda 2000 in March 1999. Agenda 2000 reformed the CAP in view of the expected enlargement to largely rural countries, such as Poland, Bulgaria or Romania.

The EU proposes reinforced rural development measures, as support for semi-subsistence farms, for the candidate countries, so that they can reap the benefit of the Common Agricultural Policy (CAP) even before they meet the EU production standards. Whilst Central and East European countries are only offered 25-35 per cent direct payments from the CAP budget from 2004 to 2006, reaching 100 per cent in 2013, the new members will receive higher rural development subsidies which will help them stabilise farm incomes.

The main aims of the new EU rural development policy are:

• to improve agricultural holdings,
• to guarantee the safety and quality of foodstuffs,
• to ensure fair and stable incomes for farmers,
• to ensure that environmental issues are taken into account,
• to develop complementary and alternative activities that generate employment, with a view to slowing the depopulation of the countryside and strengthening the economic and social fabric of rural areas,
• to improve living and working conditions and promote equal opportunities.

Between 4,300 and 4,370 million euro is allocated each year to rural development during the period 2000-06. These measures are financed by the EAGGF Guarantee Section or Guidance Section.

The following rural development measures are supported by the EAGGF:

• early retirement,
• less-favoured areas,
• agri-environment measures,
• afforestation of farmland,
• renovation and development of villages,
• protection and conservation of rural heritage,
• diversification of farm activities,  
• improvement of infrastructure.

The Commission suggests strengthening rural development in its proposal CAP Mid-Term Review, launched on 11 July 2002. Under this proposal, 20 per cent of direct payments would be taken away from farmers to be used for rural development via the introduction of an EU-wide system of compulsory dynamic modulation and expanding the scope of currently available instruments for rural development to promote food quality, meet higher standards and foster animal welfare.

The Commission argues that the importance of instruments designed to promote sustainable agriculture throughout the EU such as agri-environment and less favoured area payments, as well as other measures within the second pillar is significantly increased because the shift to decoupled direct payments may create pressures towards abandonment in some marginal areas.

Under the proposed system of dynamic modulation all direct payments will be reduced progressively in arithmetic steps of 3 per cent per year to reach 20 per cent, the maximum agreed in Agenda 2000. The new compulsory system will replace the current optional arrangements from 2004 onwards.

The Commission proposes that the maximum sum paid to a farm will be 300,000 euro. Direct aids beyond this amount will be capped and made available for transfer to the second pillar in the Member State concerned. Currently, Member States which modulate direct payments on an optional basis keep the "savings" in their accounts and have to spend them again for additional rural development activities within three years.

The rural development policy will be fur ther consolidated and strengthened by new accompanying measures:

• A new food quality chapter will be added into the rural development regulation.
• A new chapter "Meeting standards" will be introduced to help farmers to adapt to demanding standards based on Community legislation in the field of the environment, food safety and animal welfare as well as implementing farm audits.
• The agri-environment chapter will offer the possibility to offer animal welfare payments for efforts that go beyond a mandatory reference level in line with agri-environment schemes.

For the future Member State, the Commission proposes to increase financial support for agriculture through an enhanced rural development policy in order to ease the problems of transition in rural areas, and to encourage the necessary restructuring of the new member states' agricultural sectors. The implementation of the rural development policy will facilitated by the fact that it will build on the experiences gained from the pre-accession programme SAPARD.

The Commission argues that a better balance of support between market policy and rural development will increase both the social acceptability of the CAP and the possibility to address consumer, environmental and animal welfare concerns within the second pillar (rural development).

The European Parliament adopted two resolutions on in May 2002, calling for the Common Agricultural Policy (CAP) to be preserved, and for a major shift towards support for sustainable rural development. The two resolutions call for a new, third pillar for the CAP to ensure food quality and safety. They also demand full powers for the European Parliament over the CAP and the agriculture budget. Both resolutions call for more resources to be shifted from market support, which currently accounts for about 90 per cent of the CAP budget, to rural development. The Fiori Resolution also calls for an incomes policy to keep farmers on the land throughout the EU. It calls on the Commission to draft proposals for the post-2006 period aimed at making direct income support part of rural development policy.

The AgriCultural Convention has called on the European Convention to lay the foundations of a Common Agricultural and Rural Policy in the treaties. The AgriCultural Convention has "serious concerns about the negative side effects of the current CAP, and particularly its centrally controlled productivist focus". A new Common Agricultural and Rural Policy (CARP) should be based on the principles of sustainable development, democratic accountability, and should be clearly identified as a community policy. CARP should also enable developing countries fair access to Western markets and development of food security within their own. The AgriCultural Convention proposes that the current WTO round should advocate an integrated approach to rural development and sustainable farming practices across the world.

The biggest EU farmers associations COPA and COGECA say that the Commissions proposals for the CAP mid-term review "completely undermine the commitments made by the European Council when it decided Agenda 2000 at the Berlin Summit". COPA and COGECA consider that the current CAP reform model "is leading to a split between market concerns ("first pillar") on the one hand and ecological and rural development ("second pillar") on the other, with the risk of farms being segregated in a similar way".