CAP Deal on Track

A deal on CAP reform looks highly likely to be concluded in the next few hours.  After an intensive series of talks in Luxembourg the Farm Council (Farm Ministers) have agreed a new negotiating mandate.  This will be taken back to Brussels today (26th June) for final agreement by the Parliament.  A Press Conference has been scheduled for later this afternoon.   The Parliament is not expected to reject the new compromises as members of its agriculture committee have been heavily involved in its preparation.

More details of the current position can be found in a Press Release at – http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/agricult/137615.pdf 

A few brief pointers are summarised below;

• capping in its strictest sense seems to be off the table (capping would see payments halted completely above a set threshold).  However, the concept of ‘degressivity’ looks set to be introduced. This would see payments above €150,000 cut by 5%.  This would be mandatory for all Member States.
• the cuts outlined above could be waived if a large element of a Member States’ funds are paid through the ‘redistributive payment’.  This is a new concept which basically provides a top-up in payment on the first few entitlements (30 hectares).
• countries will be able to pay 8% of total funds as coupled payments, plus another 2% for protein crops.  Countries which have used high levels of coupled support in the past will be able to pay 13% or more, plus the 2% for proteins.
• a Young Farmers scheme will be mandatory under Pillar 1.  This would be funded by 2% of the total budget.  A Small Farmers scheme would be optional.
• the ‘Active Farmer’ rules will just be a simple negative list of entities not eligible by default for the new Basic Payment – e.g. airports, water companies, railways, sports grounds etc.
• the move to a flat rate regional payment (‘internal convergence’ in the jargon) will not have to be complete by 2020.  All farmers will need to get at least 60% of the average regional payment.  However, losses for individuals can be limited to 30% of their present payment.
• the threshold for financial discipline will be set at €2,000.
• within greening, the permanent pasture ratio can be set at a national or regional level and not simply farm by farm.
• the Ecological Focus Areas (EFAs) will initially be set at 5% of a farm’s eligible arable area.  This could rise to 7% after 2017.  A list of EFA eligible areas has been agreed including landscape features and fallow land.  A matrix system will be worked out which may give some features extra weight – e.g. one hectare of especially environmentally valuable land could contribute 2 hectares of EFA.
• Double funding would not be allowed under greening, and a system of graduated penalties for non-compliance has been set out.
• sugar quotas would end in September 2017.
• the new system of Areas with Natural Constraints (hill areas) would not be introduced until 2018.

More will follow when further information is available.