The European Commission's long-awaited proposals to overhaul the Common Agricultural Policy (CAP) have left most EU politicians and stakeholders disappointed.
Absolutely no one, except for the European Sugar Users association (CIUS), seems happy with the Commission’s legal proposal to reform the CAP, presented on 12 October.
First to express disappointement were the many political groups in the European Parliament, which for the first time will be co-deciding on the matter alongside EU member states following the entry into force of the Lisbon Treaty.
While most member states have remained silent for now, France and the UK – the two countries with the most diverging views on the CAP – both reacted with reservations. The UK said the proposal failed to offer radical reforms, while France found the ‘greening’ part of the CAP too complicated and not reflecting economic reality.
The EU farmer's lobby Copa-Cogeca said the proposals lacked teeth to improve the profitability and productivity of the EU agri-food sector.
And environmental NGOs declared themselves unsatisfied by the weakness of the draft ‘greening’ measures which they say will fail to put an end to intensive agriculture practices (see detailed reactions in the "Positions" below).
The EU executive has proposed making 30% of the CAP’s direct payments conditional to three 'greening' measures:
- Maintaining permanent pasture.
- Diversifying cultivation with farmers obliged to cultivate at least three crops on their arable land, two of which must represent at least 5% of the land each and the third not more than 70%.
- Maintaining an "ecological focus area" of at least 7% of farmland – excluding permanent grassland – through field margins, hedges, trees, fallow land, landscape features, biotopes, buffer strips, afforested area.
While green NGO’s welcomed the last measure in particular as an important contribution to protecting biodiversity, others described a requirement to set aside at least 7% of each farm's land for ecological purposes as “pure nonsense” at a time when food and energy is becoming scarce.
And while the 'greening' measures would be voluntary, in the sense that there is no sanction for failing to respect them other than loosing the subsidy, many fear they will represent another unnecessary administrative burden for farmers.
Environmentalists meanwhile found that the proposed crop rotation requirement does not go far enough as it fails to end intensive monocultures that damage soil and use a lot of fertilisers. Nor will it change anything regarding the EU’s dependency on the soya and maize imported to feed European livestock, they argue.
Distribution of payments
One proposal that received broad backing is a commitment to give CAP support only to active farmers, and not to those with no tangible agricultural activity. But just as many were disappointed by the definition of an active farmer, which they consider too broad: support would indeed still be given to farmers whose revenue from non-agricultural activity represent 95% of their annual income.
A proposal to progressively cap payments to bigger farms at a maximum of €300,000 per year was also not considered bold enough, as part of the salary and social security costs will be deducted from the total. The capping would therefore effectively affect only a few farms.
Meanwhile, a proposal to provide special support of up to 2% of the national envelope for new entrants to young farmers was in general welcomed.
Co-funding of first pillar
Environmental NGOs have also raised alarm about a proposal that would allow those member states that get less than 90% of the EU average for direct payments to channel up to 5% of their Rural Development funds to their 1st Pillar national envelope, which provides direct income support to farmers. Meanwhile all member states could transfer up to 10% of their national allowance under Pillar 1 to their Rural Development envelope (Pillar 2).
The first pillar direct payments are 100% financed by the EU while pillar two is co-funded by member states and aimed at pre-defined rural development and environmental measures.
For green NGOs, the “reverse shift from the second to the first pillar”, makes allowances for many of the ‘newer’ EU member states, thus represents a possibility for countries to shift money away from targeted environmental spending toward blunt income support.
The Commission is also looking to end the last remaining quota regime for sugar. The bloc's system of national sugar production limits and minimum prices should end by 30 September 2015, accompanied by reductions in import tariffs.
The proposed move was opposed by the European sugar manufacturer (CEFS) but welcomed by the European sugar users (CIUS).
Manufacturers said that the impact assessment used by the Commission to justify the abolition of the quota system “includes several inconsistencies such as the assumed increase in European production, whilst yields, beet and sugar prices are all expected to decrease.”
Users expect the abolition of quotas to stimulate competition in the market and help them overcome the “supply difficulties” they’re facing.
The EU is the world’s largest grower of sugar beets.