Understanding the CAP
18 Feb 13
The process leading to approval of the new Common Agricultural Policy (CAP), the European Union’s system of agricultural subsidies and programs, is now in its final stage and its future shape should concern us all. The CAP is the instrument that will decide the future of our food. For 50 years the CAP has soaked up almost half the EU budget. Reforming it is an opportunity for a paradigm shift towards an agriculture that is less geared to production and more towards local areas, natural resources, farmers and citizens. So far preference has been given to agricultural practices that harm soil fertility, the environment, landscapes and biodiversity, with poor countries outside Europe also suffering from unjust treatment. The CAP is currently being reformed in a process involving European institutions and organizations in the agricultural sector, but it affects all of us. The results of the reform will have significant effects for our food, environment and health. Let us look in more detail at what has been happening at the European level.
At the end of January, the European Parliament's Committee on Agriculture and Rural Development (COMAGRI) passed amendments to the draft CAP reform tabled over a year ago by the European Commission. It decided to water down or cancel some of the measures aiming to make our food production system more sustainable. The original proposal, though not perfect, seemed to be a good compromise, as it introduced significant new improvements. After the European Council, the ball will once again be in Parliament’s court and at its plenary session in March it will have the opportunity to correct the direction that COMAGRI wants to pursue in the reform process.
The European summit of February 7-8, in which European heads of state and governments agreed the budget for 2014-2020, saw a substantially unchanged commitment to Sustainable growth and natural resources. The section covering agriculture, rural development, fishing and partly environment, amounts to €373,479 billion, of which €277,852 was allocated to direct payments and market-related expenditure. The final declaration relating to agricultural policy revealed the increased importance of greening measures and ecological focus areas, though there were no indications of land percentages or mention of diversification and crop rotation. There is reference however to measures that must be applied by all farmers. So it would seem that this agreement still leaves room for significant reform of the CAP.
A more detailed examination of some aspects of the CAP:
The new CAP provides an opportunity to introduce “greening” measures. This would entail the direct payments to farms, which accounts for the largest proportion of subsidies (the so-called “First Pillar”). This thickest slice of the CAP cake has always been allocated according to farm size. Over the years, the system has ended up favoring the biggest land-holdings, which are not usually the ones showing most respect for environmental sustainability. In the proposed reform the greening measures, though not perfect, would be revolutionary: they would force the bigger farms to also bring in sustainable practices, such as crop rotation, maintaining pastures and areas having an ecological function. COMAGRI now claims it has made greening measures more flexible, but in practice it has taken them apart, one after the other, by introducing so many loopholes that they have been rendered useless.
The original reform proposal exempted farms of below 3 hectares from the greening measures in order to make things easier for small farmers, who in any case usually create proportionately less pollution than large farms. COMAGRI has raised the threshold to 10 hectares, which would exempt 82% of European farms from having to adopt greening practices. And for the largest farms many other loopholes have been introduced to get around what would no longer be a mandatory requirement. Moreover, while it was fair that certified organic farms were automatically ranked among the "virtuous" actors in the sector, it is much less fair for COMAGRI to argue that other “green” practices – but much less ecological ones – be equated with "organic" and so entitled to subsidies. In other words, those making most effort to implement sustainable practices are treated the same as those who do less or almost nothing. The situation is even more complicated with regard to direct payments: 70% of direct payments are supposed to be based on farm size and 30% on greening measures. If greening were to be voluntary, the 70% allocation would still be guaranteed on the basis of land size, providing an assurance of direct payments even to those not implementing any greening measures at all.
With the introduced amendments it would now be possible for farmers to be paid twice for the same environmental service, determined by the first Pillar (another loophole, which is technically illegal). A farm can access two different pillars for the same measures, one for greening and one relating to the conditions for direct payments, as prescribed by the second Pillar. The European Parliament considers any certification as “environmental”, independently of the measures adopted by individual farmers. This system would therefore allow farmers to receive environmental subsidies without implementing the required measures.
EFA – Ecological Focus Areas
The requirement to allocate 7% of farm land as Ecological Focus Areas has been significantly reduced to 3%. These areas only have to be set aside by farms larger than 10 hectares, excluding from the calculation areas with permanent crops. Ecological focus areas can also be cultivated, providing that no pesticides or fertilizers are used.
Crop rotation will similarly not apply to farms with less than 10 hectares. On farms of between 10 and 30 hectares it will only be necessary to rotate between two crops (the EU Commission proposed three), while on farms over 30 hectares, three rotations will be required.
Subsidies have finally been capped at €300,000 for the largest landowners (as an example, Queen Elizabeth II has been receiving €8 million per year).
The proposal to use 2% of the CAP to encourage young farmers was adopted. Members of Parliament recommend that farmers under 40 years should receive a 25% bonus on their direct payments for the first five years they farm. But they capped the payment at 50 hectares, replacing the Commission’s plan for a limit based on the average farm size in each member state.
A better definition of “active farmer” was introduced to prevent non-farming organizations such as airports and golf clubs from receiving subsidies.
CAP decision-making process
For the first time the European Parliament has powers of “co-decision” over the CAP, or ordinary legislative procedure, giving it a crucial role. Ordinary legislative procedure gives the same weight to the European Parliament and the EU Council in a wide range of areas. The great majority of European laws are adopted jointly by the European Parliament and the Council. The Commission sends its proposal to Parliament and the Council. They consider it and discuss it on two successive occasions. If an agreement cannot be reached after the second reading, the proposal is brought before a Conciliation Committee made up of an equal number of representatives of the Council and Parliament. Representatives of the Commission also attend meetings of this Committee and contribute to the discussions. When the Committee has reached agreement, the agreed text is sent to Parliament and the Council for a third reading, so that they can finally adopt it as a legislative text. The final agreement of the two institutions is essential if the text is to be adopted as a law. Even if a joint text is agreed by the Conciliation Committee, Parliament can still reject the proposed law by a majority of the votes cast. So, providing that the reform process is not thrown into complete disarray by the European Council’s budget decisions, the European Parliament’s plenary session on the CAP from March 11 to 14 will be a historic opportunity to reverse the changes to the CAP wanted by COMAGRI and to reinstate desirable environmental measures.
What will happen at the March plenary session?
On March 12, 2013 a European Parliament plenary session in Strasbourg will decide the fate of our agriculture for the next seven years. It will determine issues such as the permitted quantities of fertilizer, how many farms will survive until 2020 and what type of agriculture we want for the European Union. So it is a crucial vote and the last chance to defend greening against the watered-down proposals of COMAGRI. Below is a table comparing COMAGRI’S proposals and those of ARC2020, the Brussels-based organization representing over 150 associations, including Slow Food.
For the first time the European Parliament will be able to intervene in this negotiation and we must put pressure on our deputies so they do not make the mistake of supporting the old paradigm that, far from serving the general interest, has encouraged the worst methods of production. It is not fair to use public resources to promote the interests of a minority. A Europe-wide campaign called Go M.A.D. has been launched by various associations and networks, including Slow Food, as part of the Arc 2020 project. Information explaining more about the CAP reform can be found here to help people bring these issues to the attention of our parliamentarians. Citizens can get involved and must participate in the debate before it is too late. Find out more and take action. What is at stake is the future of our food, the places where we live, and our well-being.
Sources: Arc 2020
Article by Carlo Petrini published in La Repubblica on January 29, 2013
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