A provisional agreement has been struck on the rollout of recovery funds in the EU agricultural sector, which will make a total of €10 billion available for farmers from 2021 up until the end of 2022.
The interinstitutional agreement over the €8 billion recovery aid for EU farmers and food producers was struck between the European Parliament, Council and Commission on Tuesday (10 November).
It paves the way for the deployment of the recovery funds, which are designed to help the sector bounce back from disruptions caused by the COVID-19 pandemic.
Farmers will be able to access an additional €2.6 billion in 2021 as a down payment from the next rural development fund, which is part of the wider multi-annual financial framework.
Considering this top-up, an excess of €10 billion will be made available to farmers in the two-year period 2021-22 in the context of the rural development fund, known as the second pillar of the Common Agricultural Policy (CAP).
The part of the recovery fund devoted to farming was originally due to be made available only from the start of the next CAP period, from January 2023 onwards.
However, this has now been brought forward given the “unprecedented challenges that are facing the agricultural sector and rural areas,” according to Paolo de Castro, shadow rapporteur on the CAP reform, who spoke during a press conference following the conclusion of the deal.
“This support needs to be made available as soon as possible to genuinely stimulate the sector and economic recovery in the name of resilience, sustainability and digitalisation,” he stressed.
The €8 billion funds are now set to be staggered over the next two years, with €2.4 billion made available in 2021, followed by the remaining €5.6 billion in 2022.
As these funds are designed to stimulate recovery, they “should not be used finance measures which represent business as usual,” he added, stipulating that there has to be some added value in terms of sustainability, resilience and digitalisation.
De Castro also stressed that these funds must be used in line with the targets of the Green Deal, including both the Farm to Fork and Biodiversity strategies, as well as being consistent with other international commitments.
As such, at least 37% of the recovery funding has been earmarked for organic farmers, environment and climate-related actions and animal welfare, while at least 55% of the fund will support young farmers’ start-ups and on-farm investments that contribute to a forward-looking recovery.
Member states can opt to spend the remaining 8% as they see fit, providing that it is spent within the general framework of sustainable development.
“We have managed in a very short timeframe to agree that the desperately needed financial aid for EU farmers, food producers and rural beneficiaries will be released swiftly,” said Norbert Lins, chair of the agriculture committee of the EU Parliament.
“Now we must quickly finalise the negotiations on the CAP rules for 2021 and 2022 so that, by the end of the year, we have relevant rules approved to help farmers to be more resilient in the future,” he added.
The agreed text is now expected to be approved by the Parliament plenary session in December, featuring no amendments from the agreement as it stands, de Castro said.
The agreed CAP transitional rules must then be endorsed by the Parliament and the Council before they can enter into force on 1 January 2021.
[Edited by Gerardo Fortuna]