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EU Parliament CAP Reform vote – positives and negatives

The next iteration of the CAP came a step closer this week as the European Parliament Agriculture Committee voted on a series of compromise amendments to the original draft CAP regulations published in October 2011. This important step creates the Parliament’s version of the draft regulations, which now needs to go through a Plenary session of the whole Parliament before it is finalised and then it will form the basis for negotiation with the EU Council.

On direct payments, some of the issues that raised concern, such as the definition of permanent grassland, active farmer and first eligibility and the initial step to area payments have been addressed, but capping was agreed and will remain in the text. The greening measures have been altered significantly to increase the flexibility with which the measures apply. There are now more ways to qualify for greening support, such as being predominantly permanent grass, being organic, in an agri/environment scheme or in an environmental certification scheme, and the greening measures that need to be adopted if non of these apply have also been amended. There also now appears to be the possibility of allocating up to 15% of the direct support budget to coupled support.

In terms of the big picture, the call for greater flexibility has resulted in Member States and regions effectively being given greater levels of discretion on implementation. If these proposals stand, Scotland will have a wider set of choices to make in how to implement the scheme, such as what level of coupled support, whether to have a Small Farmers Scheme, how to define appropriate activity levels and who qualifies as an active farmer.

On rural development, the Committee voted through amendments that made it a requirement for MS to devote at least 25% of the RD budget to agri-environment-climate measures, but they also restricted eligibility for these measures to ‘farmers’ (removing other land managers), which could potentially remove the ability of some landowners that do not classify as a ‘farmer’ from receiving support for wildlife, habitat and moorland management. Scottish Land & Estates will continue to engage to seek to ensure that members interests are represented and that the policy does not introduce rules that remove members from eligibility and that potentially undermine a huge range of positive environmental management.

Some headlines from the vote on the direct payments regulation can be found here:

General

  • The definition of Permanent Pasture has been widened to includes "any species suitable for grazing" (removing concerns surrounding the eligibility of heather), but the definition also still includes reference to a rotation length. Permanent Pasture is land which "is not included in the crop rotation of the holding and not ploughed for seven years or longer".
  • Member States or regions (such as Scotland) given ability to set minimum activity requirements.
  • Member States or regions given ability to draw up lists of types of enterprises which are automatically excluded from active farmer definitions, unless they can provide verifiable evidence that they should qualify. Farmers who receive less than 5000 EUR a year in direct payments could be excluded from active farmer requirements.
  • Capping supported with the capping level is set at €300,000 as per Commission proposal. The funds from capping will stay in the region or Member State where they were generated and will be used for Pillar 2 measures.
  • Farmers will be eligible for entitlements in the first year of the new scheme if they activated any entitlements in a year from 2009-2011 (to be chosen by the Member States), or if they submitted evidence of active farm production in 2011.  The farmer will then get as many entitlements as he has eligible hectares.  Member States may also apply a "reduction coefficient" on hectares which have a lower yield potential, in order to reduce the value of entitlements on poor land.
  • Member States are allowed to limit the transition to the new area based system in the first year to 10% (original proposal was 40%) and there are different options for the end point of transition: by 2019 a Member States can choose to either have a uniform unit value per hectare for each region, or to allow deviation from the average value of up to 20%.
  • Member States can top slice up to 3% of their ceiling in the first year to fund a National Reserve. MS can then top slice any percentage in following years according to their needs. The NR should focus on supporting young farmers and farmers who have never previously held entitlements. It can also be used to increase the value of entitlements of farmers who held entitlements in the previous scheme but of a low value, up to the national or regional average.
  • Member States must use up to 2% of their ceiling for the young farmer top up, which is paid to farmers under the age of 40 and who possess the requisite skills as determined by Member States.  If the whole 2% is not used, Member States can use the remainder to increase entitlements through the National Reserve.
  • A Member State can use up to 15% of its national ceiling for coupled support, and priority shall be given to sectors which received coupled support in 2010-2013.
  • Member States may set up a simplified payment scheme for small farmers, which will be open to all farmers entitled to direct payments of less than €1500.  Farmers in this scheme will go through a simpler administrative process and not be subject to greening.  

Greening

Greening created division but the compromise text was adopted by small margin of 22:21. Farmers will have four ways by which to qualify for the greening payment:

  1. Where 75% of the farm is permanent pasture or used for the production of grass, and where the remaining eligible land does not exceed 50 hectares.
  2. Where the farmer is engaged in organic farming or an agri/environment scheme
  3. Where the farmer is engaged in an environmental certification scheme which the Commission considers has equivalent environmental impact to the three greening practices: this could be a nutrient management plan, an energy efficiency plan, or other measures.
  4. The farmer undertakes the greening measures applicable to their holding, as per below:  

Permanent Pasture: The ratio of land under permanent pasture must be maintained, either at national, regional or sub regional level.  This potentially removes the strict controls at the holding level depending on the choice of the MS.

Crop Diversification: Where the arable land covers between 10 and 30 hectares, the farmer must cultivate two crops: no crop shall exceed 80% of the arable land.  Where the arable land is over 30 hectares, the farmer must cultivate three crops, with the main crop limited to 75% and two crops limited to 95%.

Ecological Focus Area: If the arable area of a farm is more than 10 hectares the farm must establish EFAs, which can include land left fallow, landscape features, land fixed with nitrogen crops buffer strips and many other landscape types determined by the Commission. The EFA shall be counted as a percentage of eligible hectares (excluding permanent pasture) but can be applied on the entire holding. EFA will start at 3% in the first year of the new Regulation, rising to 5% in 2016, and, following a review of EFA in 2017, a possible increase to 7% in 2018.

 

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