CAP tracker: Mapping the latest movements on EU farming policy

The EU’s common agricultural policy, or ‘CAP’, aims to support farmers and improve agricultural productivity. [SHUTTERSTOCK]

Welcome to EURACTIV’s CAP tracker, your one-stop shop for all the latest developments on the Common Agricultural Policy (CAP).

Be sure to check back here regularly for your weekly update on all things CAP, including the latest movements on the transitional arrangement and the current policy situation.

All of EURACTIV’s CAP related stories can be found here.

As the CAP reform will not be concluded before the start of the 2021-2027 programming period, MEPs and member states “informally developed a common understanding” on interim measures based on the current rules, in order to avoid EU farmers being financially exposed.

Although provisional, the compromise reached at the end of June involves all the essential aspects of the transitional CAP file. As a consequence of the deal, the coming into force of the post-2020 CAP will be pushed back to 2023.

But the agreement reached on a two-year temporary scheme before the next EU farming subsidies programme starts was criticised by the EU executive. The Commission believes that a one-year Common Agricultural Policy (CAP) transition period would fit better in the context of F2F implementation and ‘Next Generation EU’, the Commission’s €750 billion Recovery Fund aimed at reviving and transforming the bloc’s economy. The Commission does not seem willing to concede on this matter, threatening to withdraw the proposal as a last resort weapon, which MEPs took as a threat to their lawmaking independence.

In March, the European Court of Auditors (ECA) warned about the risk of a long transitional period as it may delay the Commission’s ambition to make the farming sector more environmentally sustainable.

CAP budgetAfter 92 hours of intense negotiations in Brussels, EU leaders agreed on 21 July on the EU’s next seven-year budget, which includes a deal on €344 billion CAP spending.

The European Parliament has to approve the deal yet. Parliament’s President David Sassoli has hinted that a final vote might be scheduled between the end of September and October.

CAP reform – The deal on the CAP budget reached by the EU leaders will enable the European Parliament and the Council to kick off negotiations and reach a final deal on the three laws forming the legislative framework of the programme.

MEPs still need to agree on their CAP negotiating position and a final plenary vote is expected in the second half of October. Once the procedure in the Parliament will be over, MEPs and the rotating EU Council presidency will settle the other pending issues in the trilogue, the interinstitutional talks between the two co-legislators.

For the 2014-2020 CAP, the talks led by the then Commissioner Dacian Ciolos took 18 months of trilogue for a total of 56 meetings between Parliament and Council.

Transitional CAP – The two-year temporary scheme for the period before the next EU farming subsidies programme starts has yet to be confirmed in autumn, as some issues linked to the EU’s next long-term budget have remained open.

The farming budget for 2021-2027 will amount to €344 billion, roughly €20 billion more than what the EU executive earmarked in its proposal in July 2018, although significantly lower than the 2014-2020 CAP budget which totalled €383 billion, even without the UK contribution.

The agreed budget allocation for direct payments to farmers and market-related expenditures, which together form the first CAP pillar, is now €258.6 billion.

The rural development support, considered as the CAP’s second pillar, was put at €78 billion with an extra €7.5 billion coming from the ‘Next Generation EU’ stimulus plan (NGEU), for a grand total of €85.5 billion.

More info on the CAP budget deal are available at this link.

National strategic plans – These plans are a key component of the future CAP, through which each member state will set out how they intend to meet the 9 EU-wide objectives of the policy (see below for more information). It is still unclear how much flexibility member states will be given in drafting the plans according to their needs and ambitions, adapting interventions to local conditions. The implementation of the EU’s new food policy, the F2F, also passes through national strategic plans. Read more about these plans below. 

Performance-based CAP – Another main drive of the reformed CAP is performance monitoring. How this will be achieved is still up for debate, whether by tolerance margins, the single audit approach and setting annual or biennial milestones for effective performance reporting.

New green architecture – This is centred around increasing the environmental performance of the CAP. The main issue will be ensuring complementarity between the new architecture and the environmental-climate measures of the EU set out in the F2F. 

Conditionality – Conditionality is part of the greening architecture and will replace the greening payment requirements of the previous programme. Agreeing on a control system and penalties in relation to conditionality will be crucial, as well as establishing derogation on certain categories.

Eco-schemes – This innovative system is particularly important in delivering environmental goals, but an excessive or insufficient uptake of eco-scheme by farmers could result in a loss of funds. Their mandatory or voluntary nature is yet to be decided.

Crisis reserve and other exceptional measures – After the COVID-crisis, there is a high likelihood that an improved mechanism to deal with extraordinary market crises could be introduced. 

Definitions are also set to be a crucial issue. Definitions for what constitutes genuine farmers, young farmers, permanent grassland and permanent pasture, eligible hectare and arable land are all as yet undefined, but these will provide the basis for eligibility for measures, as well as categories exempted from conditionality or eligible for training/skills.

Wine varieties – You may not know it, but there are seven varieties of grapes that are forbidden in Europe, known as American grapes: Vitis Labrusca, Noah, Othello, Isabell, Jacquez, Clinton and Herbemont. The next CAP will decide whether to open the market to these grape varieties, as well as enforcing stricter rules on wine labelling

Meat name – In its negotiating position, the European Parliament calls for reserving meat-related terms “exclusively for edible parts of animals.” If this position passes, it has the potential to affect the rising sector of veg-meat producers.

A core aim of the European Commission is to delegate more responsibility to member states in planning CAP investments and policies.

This means that member states will now be directly responsible for CAP – its design, implementation and evaluation – allowing for a more flexible and targeted approach to the CAP.

Through these plans, countries will set out how they intend to meet the 9 EU-wide objectives using CAP instruments while responding to the specific needs of their farmers and rural communities.

In this way, the Commission aims to simplify and modernise the CAP, shifting the emphasis from compliance and rules towards results and performance.

The process of developing a strategic plan begins with two steps.

First, a SWOT analysis (an evaluation of the strengths, weaknesses, opportunities, and threats) must be prepared based on an assessment and prioritisation of needs. These are obliged to involve feedback from stakeholders through various mechanisms.

Second, an ex-ante evaluator must be chosen who is required to appraise the assessment of needs, including the procedures used to involve stakeholders.

Member states are currently undergoing this process, and are set to forward draft strategic plans to Brussels by the end of 2020. These plans are then due to be presented during 2021 and will, in principle, be implemented from 2022 onwards.

21 July 2020 – EU leaders agreed on the Multiannual Financial Framework (MFF), which includes the total amount of CAP spending too.

30 August-1 September 2020 – Informal Agrifish Council in Koblenz organised by the German rotating presidency.

2 September 2020 – First European Parliament’s Agriculture Committee after the summer break

Second half of October – MEPs are expected to have the final plenary vote on Parliament’s CAP negotiating positions.

November – Trilogue on post-2020 CAP could start.

The EU’s common agricultural policy, or ‘CAP’ as it’s known, aims to support farmers and improve agricultural productivity, ensuring a stable supply of affordable food and that the EU’s farmers are able to make a reasonable living while also safeguarding the environment.

The CAP has undergone a series of transformations over the years to meet changing economic circumstances and citizens’ requirements and needs.

Negotiations are currently underway on the future of the CAP post-2020, which is under pressure to provide answers to an increasing number of challenges, including climate change, biodiversity loss and soil degradation.

On 1 June 2018, the European Commission presented legislative proposals on the CAP beyond 2020.

These proposals aim to make the CAP more responsive to these current and future challenges while continuing to support European farmers for a sustainable and competitive agricultural sector.

The future CAP revolves around nine specific objectives reflecting its economic, environmental and socio-territorial multifunctionality. These include:

  • supporting viable farm income and resilience across the Union to enhance food security
  • enhancing market orientation and increasing competitiveness, including a greater focus on research, technology and digitalisation
  • improving the farmers’ position in the value chain
  • contributing to climate change mitigation and adaptation, as well as sustainable energy
  • fostering sustainable development and efficient management of natural resources such as water, soil and air
  • contributing to the protection of biodiversity, enhancing ecosystem services and preserve habitats and landscapes
  • attracting young farmers and facilitate business development in rural areas
  • promoting employment, growth, social inclusion and local development in rural areas, including bio-economy and sustainable forestry
  • improving the response of EU agriculture to societal demands on food and health, including safe, nutritious and sustainable food, food waste, as well as animal welfare

The CAP achieves this via:

  • Income support through direct payments. This is designed to ensure income stability and remunerate farmers for environmentally friendly farming and delivering public goods not normally paid for by the markets, such as taking care of the countryside
  • Market measures to deal with difficult market situations such as a sudden drop in demand due to a health scare, or a fall in prices as a result of a temporary oversupply on the market
  • Rural development measures with national and regional programmes to address the specific needs and challenges facing rural areas

The CAP is organised into two pillars.

Pillar 1 addresses farm income support and market management and is completely financed through the EU budget by the European agricultural guarantee fund.

Pillar 2 addresses rural development including agri-environment-climate measures and is co-financed jointly by the EU budget through the European Agricultural Fund for Rural Development and by member states. 

See here to learn more about common concerns related to the CAP.

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