General Approach on CAP agreed by Ministers: Trialogue discussions now underway

After long discussions and two late nights, on 19 March, the Agriculture Council agreed its negotiating mandate, known as the General Approach, on the CAP reform package of legislative texts. Only two Member States were unable to support the proposed compromise texts and voted against (Slovenia and Slovakia). With a general approach agreed, trialogue discussions are now underway with the first scheduled to take place on 11 April (see CAP2020 calendar).

In general terms, the Council’s position significantly waters down the green elements of the reform. The number of farms and area of land that will be exempted from the Pillar 1 greening measures has been reduced significantly and it is proposed that funding the same measures through the agri-environment measure should be permitted. In addition, the proposed new elements of cross-compliance, including the introduction of a standard of Good Agricultural and Environmental Condition to protect carbon rich soils, have been rejected.

Pillar 1 greening and double funding

The Council’s position on the greening measures is substantially different to that of the Commission, as set out in their proposals, and the European Parliament, as stated in their negotiating mandate. The Council have proposed three different approaches to greening as set out below

  1. The first route involves the application of the Commission’s three proposed measures. However, the content and reach of the three green measures has been altered in a way that will reduce their potential impact and the list of types of farms to whom the measures do not apply has been extended (see box below for detail).
  2. The second route, which can be carried out either alongside the green measures or as a standalone approach to greening, is to identify ‘equivalent’ measures carried out under agri-environment agreements or in compliance with national or regional environmental certification schemes. The schemes that are deemed to be ‘equivalent’ must be ‘effective and objective’. Rules for assessing these criteria are to be set by the Commission and schemes would be subject to approval.
  3. The third route is to permit the development of a standalone certification scheme at the national or regional level that would operate instead of the greening measures. The final compromise requires such certification schemes to require farmers to carry out the ‘same practices’ as are set out as the greening measures within these schemes.
  • The Ecological Focus Area measure should only apply to farms where the area eligible for the measure is over 15 ha. The percentage has been proposed to be five per cent with a possible rise to seven per cent from 2018 subject to the results of an evaluation to be carried out by the Commission by 2017. The list of what constitutes an EFA has been broadened to include inter alia agro-forestry, permanent crops with between 50 and 250 trees per hectare, short rotation coppice, areas with catch crops, green cover or nitrogen fixing crops. Weighting factors could be applied to different elements of the EFA according to their environmental benefit to be taken into account when calculating the total area required to represent the EFA commitment. These should be set out as an Annex to the legislative text. The measure would not apply to a whole range of holdings, including those where over 75 per cent of the eligible area (ie arable and permanent crop area) is under grass, fallow, leguminous crops or water. In response to Scandinavian concerns, an additional exemption was secured for farms in Areas of Natural Constraint where the majority of land is under forest cover. In addition 50 per cent of the EFA on a holding can be implemented at a regional level to create contiguous areas of EFAs or farmers can implement the EFA requirements collectively (up to 10 farmers together), as long as 50 per cent of the requirement is carried out on his/her own holding.

  • The thresholds for the crop diversification measure mean that it would not apply to arable areas of 10 ha or less. For arable areas between 10-30 hectares, two different crops would be required, with the main crop not exceeding 75 per cent of the area. Where the arable area is over 30 ha, three crops will be required, with the main crop covering no more than 75 per cent and two crops not covering more than 95 per cent of the area. A range of further exemptions to this measure have been itemised, including situations where the majority of the area (over 75 per cent) is fallow, planted with legumes, under grass or in an agri-environment agreement.

  • Changes to the permanent grassland measure include a derogation from requiring farmers to maintain their areas of permanent grassland if the ratio of permanent grassland to total utilised agricultural area (UAA) has decreased by less than five per cent to the detriment of permanent grassland in 2012. The measure does not have to be applied at the holding level, but can operate at national, regional or sub-regional level. If Member States do not use this derogation, an alternative system can be applied as follows: in any given year, if the ratio of permanent grassland to UAA has not decreased by more than 3.5 per cent from the base year (2011 or 2012) then all farmers in the given area will be deemed compliant; if the ratio has declined between 3.5 and seven per cent then farmers will be deemed compliant as long as they received formal authorisation for any ploughing of permanent grassland; and if the ratio declines by more than seven per cent only those farmers who have ploughed permanent grassland without permission will have to reconvert those areas. The requirements under this measure also do not apply if the ratio thresholds are exceeded due to afforestation as long as it is ‘compatible with the environment and does not include plantations of short rotation coppice, Christmas trees or fast growing trees for energy production’.

Despite significant pressure to remove the link between compliance with the greening measures and receipt of the basic payment, the final text on penalties states that all farmers not complying with the greening, measures will lose 125 per cent of their greening payment, giving farmers a much stronger impetus to comply.

The Council also propose that there should be a transitional period for the introduction of requirements to map landscape features and include these within the LPIS. The date proposed for full compliance is 2019.

Disappointingly, despite the EP voting against double funding, this was not ruled out by Council. They explicitly deleted the text under the agri-environment measure in Pillar 2 referring to the green measures as the new environmental baseline.

Other Pillar 1 points

Also agreed in the Council’s general approach are provisions for a greater proportion of the Pillar 1 ceiling to be allocated to coupled payments, increasing the Commission’s proposal of five per cent to seven per cent and permitting 12 per cent to be allocated in a range of situations, including those Member States who continue to operate coupled payments for various sectors.

In relation to direct payments, strong lobbying from certain new Member States, has led to the proposal to permit those operating the Single Area Payment Scheme (SAPS) to continue to do so until 2020 if they wish to do so. The speed at which the value of direct payments should move towards a uniform rate within a specific region was another contentious issue, with the Council proposing a much slower introduction of area payments.

Rural Development

There a far fewer significant points to note regarding the agreed texts on rural development. Disappointingly, the Council have not earmarked funds for environmental measures within Pillar 2 and the proposed new measures to fund income stabilisation under Pillar 2 were supported. On the latter, many fear that this could be a significant drain on already limited resources if Member States choose to use it.

In relation to the proposals for phasing in of the revised criteria for defining Areas of Natural Constraints, increased flexibility has been proposed for the phasing out of payments in areas that would no longer be eligible for such support. The period of time over which payments can be phased out has been extended to four years, with degressive payments needing to be brought in by 2016 at the latest. In addition, the way in which the delimitation criteria can be applied has been made more flexible so that a combination of two of the biophysical criteria could then fall within the threshold value, rather than just one.

Cross Compliance

There were no surprises in relation to cross compliance, with no changes made to the line agreed under the Cyprus Presidency, namely to propose the exclusion of the Water Framework and the Sustainable Use of Pesticides directives from the list of Statutory Management Requirements (SMRs) and to remove the proposed new GAEC standard to protect carbon rich soils.

Reactions

At the press conference following the agreement, Commissioner Cioloș commended the Irish Presidency in finding compromises on certain issues where there had been very divergent views amongst Member States. While he welcomed some of the Council’s positions, he signalled that in certain areas they had not gone far enough to reach agreement with the Commission, particularly in terms of the rate of transition towards flat rate payments in Member States (internal convergence).

Stakeholder responses to the agreed Council negotiating mandate were mixed, with industry generally welcoming the proposals and green groups unhappy with the extent to which the greening proposals have been watered down. See press releases for COPA-COGECA, WWF, EEB and BirdLife Europe.

Next Steps

The next stage of the negotiation process is the trialogue discussions between the Council, the EP and the Commission with discussions starting on 11 April and up to four meetings a week are scheduled between then and the end of June (see CAP2020 calendar). The Irish Presidency has stated its continued ambition to reach an agreement by the June Agriculture Council meeting. However, one notable sticking point to achieving this could be the EP’s continued refusal to approve the Multi-Annual Financial Framework as agreed by Heads of State in February.

PUBLICATION DATE

09 Apr 2013