Agrifood Brief: Habemus CAP

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37 - EU auditors, CAP (in)action on climate change

This week: EURACTIV spoke with Jindrich Dolezal of the European Court of Auditors about their recent report which lambasted EU agricultural funding for combatting climate action – totalling €100 billion – saying it has so far been ineffective, especially when it comes to livestock farming and peatlands. 

You know what they say – third time’s a charm. And that’s certainly the case with our #finalCAPdown, which we brought back for the third and final time today because – yes, you guessed it – the CAP has officially been wrapped!

After (literally) years of discussion and (what feels like) decades of our lives, the fate of the future EU farming subsidies programme has been sealed (for more information on this, check out our article).

So what is in store for the future of our farming sector? Let’s take a look at a few of the key points…

Strategic Plans

Eco-scheme ring-fencing: The compromise fixes eco-scheme ring-fencing at 25% for the whole period, with an initial two-year learning period and a “floor” mechanism set at 20% – a slight movement compared to the last round of talks which saw the Council pushing for an 18% “floor”.

The “floor” allows the spending of unused funds between 20% and 25% of the eco-schemes, although the overall amount of unused funds below the floor needs to be compensated by the end of the programming period through some compensation mechanisms.

There will be also some “rebates”, meaning that member states that spend more than 30% of the rural development programme – the CAP’s second pillar – for agri-environmental practices can get up to 50% reduction on money spent for eco-schemes.

Rural development ring-fencing: The green spending in the second pillar is pegged at 35% of the total budget for rural development.

Green Deal alignment: While MEPs did get the coveted reference to the Green Deal targets, this came only in the form of a recital of the Strategic Plans Regulation, rather than an article, leaving it on a much weaker footing.

The recital will read: “When assessing the proposed CAP Strategic Plans, as referred to in Article 106, the Commission should assess the consistency and contribution of the proposed CAP Strategic Plans to the Union’s environmental and climate legislation and commitments and, in particular, to the Union targets for 2030 set out in the Farm to Fork Strategy and the EU Biodiversity Strategy.”

Social dimension: Member states will start implementation of this new social conditionality voluntarily from 2023 and mandatorily from 2025.

There will be also a two-year ‘rendez-vous’ clause, with the Commission asked to monitor the impact of the mechanism on workers conditions and come up with a study and potentially with proposals to enhance the social dimension of the CAP including possibly enlarging in scope.

Internal Convergence: Compromise settling on 85% of average value by 2026 at the latest but will start from 2023 and progress each year to the 85%

Redistributive payments: These will be set at least 10% of direct payments, but will have exceptions for member states doing a redistribution in other ways, such as convergence.

Support for young farmers: New mandatory minimum level of 3% of national budgets for direct payments to young farmers (defined as farmers up to 40 years). This could finance complementary income support to young farmers (CISYF), start-up aid and investment support targeted at young farmers with a weighting factor of 50%.

Redistribution of income support: Member states will mandatorily redistribute at least 10% to the benefit of smaller farms, and must describe in their strategic plan how they plan to do this.

Horizontal Regulation and Common Market Organisation

Agricultural crisis reserve: The new fund will be introduced to fund market measures in times of crises, with an annual budget of at least €450 million. Funds can be paid out to farmers as of 2023.

International trade policy: A joint statement by the Council, the Parliament and the Commission on proactive engagement at a multilateral level for the achievement of the European Green deal has been attached.

This concerns the application of EU health and environmental standards to imported agricultural products.

“Given the importance of its market in international trade, the European Union can use its leverage capacity to raise health and environmental standards globally and thus contribute to achieving international environmental objectives such as those of the Paris Agreement,” the declaration reads.

The Commission is also invited to present by June 2022 at the latest a report assessing the rationale and legal feasibility of applying health and environmental standards to imported agricultural and agri-food products as well as identifying the concrete initiatives to ensure better consistency in their application, in compliance with WTO rules.

Import tolerances of pesticide: The infamous article 188a proposed by the Parliament has been replaced by a Commission’s declaration. This declaration says that the EU executive commits itself to ensure that, following a thorough assessment of the scientific information available for active substances and in conformity with WTO rules, import tolerances and Codex Maximum Residue Limits (CXLs) are assessed and reviewed for active substances that are not, or are no longer, approved in the EU, so that any residues in food or feed do not present any risk for consumers.

“The presentation by the Commission of the proposal for a legislative framework for sustainable food systems (check reference) will be a crucial additional step towards the full achievement of this ambition, in coherence with the Green Deal objectives,” reads a final addition obtained by the Parliament.

Sale of grapes for PDO/PGI wines: Recognised interbranch organisations operating in the wine sector may provide non-mandatory price guidance indicators concerning the sale of grapes for the production of PDO/PGI wines provided that such guidance does not eliminate competition in respect of a substantial proportion of the products in question.

Sugar as a product eligible for intervention: A joint statement from both lawmakers has been attached in which difficulties faced by the sugar sector after the abolition of the sugar quotas in October 2017 are recognised.

The current state of the sector and its adaptation strategies will be assessed thoroughly within the framework of a study to be delivered in autumn 2021. Lawmakers will consider any appropriate future policy developments in light of the key findings and conclusions made in the context of this study.

Such future policy developments could encompass any relevant regulatory and non-regulatory initiatives related to market and crisis management tools, market transparency in the sugar supply chain, contractual relations between growers and sugar producers, international trade and the evolution of the bioeconomy.

Stories of the Week

Final CAPdown: Negotiators seal a deal on future EU farming subsidies programme
A provisional agreement has been reached between European lawmakers on the reform of the EU’s Common Agricultural Policy (CAP), sealing the fate of the bloc’s farming subsidy programme for the 2023-2027 period. EURACTIV’s agrifood team has the details.

All words, no action: CAP funding ineffective at combatting climate change, say auditors
EU agricultural funding for combatting climate action has so far been ineffective, according to a damning new report from the European Court of Auditors, which criticises inaction on livestock farming and calls for a “polluter pays” principle. Natasha Foote has more

A thousand tonnes of harmful counterfeit pesticides seized in EU
The EU’s law enforcement agency, Europol, says it took 1,203 tonnes of illegal pesticides off the market between January and April on the back of a rise in online sales of banned substances. Natasha Foote has the story

Agricultural education too ‘stale’ for tomorrow’s farmers, says expert
Agricultural education is “stale” and in need of a shake-up to help tomorrow’s farmers meet the challenges ahead, according to a leading veterinary consultant and educator, Tommy Heffernan, who warned the sector is facing a decade of “massive change”. Learn more

German agriculture minister slams Timmermans ahead of CAP trilogue
German Agriculture Minister Julia Klöckner has launched a sharp attack on EU climate chief Frans Timmermans ahead of continued negotiations on the reform of the Common Agricultural Policy (CAP) in Brussels. EURACTIV Germany reports.

News from the bubble

Trade troubles: In a letter sent to Trade Commissioner Valdis Dombrovskis, EU farmer’s association COPA-COGECA expressed its growing concern about the consequences of the EU-Morocco agreement on the fruit and vegetable markets and in particular the tomato market. Pointing out that with the cumulative effects of Brexit, the EU tomato prices have plummeted to levels that do not cover the production costs for most European growers, the association warned that production is at risk in strategic regions of the EU. Reacting to this situation, Copa-Cogeca Secretary General, Pekka Pesonen said that the situation on the ground is “rapidly worsening”, urging the Commission to react quickly. “The Commission should also suggest triggering planned safeguard clauses and compensation allocated to the European rural areas that have been impacted,” he added.

In other news, with a slow start at the beginning of the year, EU agri-food trade in January-March 2021 (exports plus imports) reached a value of €75.8 billion, 4% less than in January-March 2020, according to a new Commission report. EU exports decreased by 0.9% compared to the corresponding period in 2020, reaching €46.4 billion.=

Winter crops: The June issue of the JRC MARS Bulletin “Crop monitoring in Europe” was published this week, which suggested an improved yield outlook for EU winter crops.

Agrifood news from the Capitals

FRANCE
The French agrifood minister presented the climate action plan this week. The national action plan for climate change adaptation, presented by Julien Denormandie on Wednesday (June 23rd), is supposed to boost the transformation of the French agrifood sector and increase its resilience in the face of environmental challenges. The action plan aims at accelerating the development of agricultural practices that mitigate greenhouse gas emissions, support the public demand for food produced with less environmental impact and accompany the adaptation of the agricultural and forest sector to the challenges of climate change. (Magdalena Pistorius | EURACTIV.fr)

GERMANY
German second chamber adopts national CAP legislation. Two weeks ago (10 June), the legislative package to implement the reform of the EU’s Common Agricultural Policy had already been approved by the German parliament, the Bundestag. On Friday (25 June), the Bundesrat, the second chamber made up of the federal regions’ governments, has also given its consent – the final step necessary for the adoption of the package. Large parts of the legislation had been based on a compromise struck in March between the 16 regional agricultural ministers. “That we managed to do this is a huge success,” said Till Backhaus, agricultural minister of the federal state Mecklenburg-Vorpommern, during the session. “Today, we are making an important contribution to the development of agriculture and rural areas, but also to the funding of environmental measures,” he added. (Julia Dahm | EURACTIV.de)

UK
The UK could be opening the door to 119 pesticides banned for health and environmental reasons, a new report looking at implications of signing up to a Pacific free trade agreement has warned this week. The report says that the deal with 11 countries, including Australia, Canada and Mexico, risks “exposing UK consumers and wildlife to a new suite of toxic pesticides”. Josie Cohen, head of policy and campaigns at Pesticide Action Network (PAN) UK, said that this “flies in the face of Government promises not to sign a trade deal which compromises UK environmental protection and food standards”. “Trade sovereignty is touted as one of the key benefits of Brexit, but CPTPP is a done deal so by joining with almost no opportunity to change the text of the agreement we are relinquishing  control of our trade policy,” she criticised. (Natasha Foote | EURACTIV.com)

IRELAND
IFA President Tim Cullinan attended a farm protest in Brussels on Friday (25 June) to highlight the dangers for farming in EU proposals, as the latest CAP trilogue continues. Speaking to EURACTIV on the sidelines of the protest, he said that he remained very concerned about some of the tabled propositions, notably on internal convergence. “It is very concerning for us, because it’s going to move more funding from farmers that are already just about viable,” he said, adding that the goal was to ensure that we end up with “more farms that are viable, not the other way around”.

Events

28-29 June – There is an AGRIFISH Council meeting where EU ministers will discuss the CAP reform

28-29 June – There is the Good Practice Workshop – ‘A journey through evaluation plans: Learning from past experiences for the future CAP’ designed to reflect on experiences in relation to the design and implementation of evaluation plans.

30 June – There is the 2nd Webinar organised by DESIRA in the context of the Rural Digitalisation Forum to discuss the envisaged role of digitalisation in rural areas and reflect on the recommendations produced by the Rural Digitalisation Forum to boost sustainable digitalisation of agriculture, forestry and rural areas

30 June – There is a EURACTIV Virtual Conference to discuss the role of data-driven actions in bringing sustainability to the dairy sector

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