Member states to set the bottom floor

The climate and environment are central objectives in the new CAP proposal, but more flexibility for member states risks undermining delivery on the ground.

On 1 June the Commission presented their proposal for a Common Agricultural Policy (CAP) 2021–2027. The agricultural commissioner Phil Hogan presented it as “delivering genuine subsidiarity for member states; ensuring a more resilient agricultural sector in Europe; and increasing the environmental and climate ambition of the policy”.

Environmental organisations responded with criticism. Bérénice Dupeux from EEB said that the “proposal remains an empty shell, with payments neither linked to environmentally friendly farm methods or actual environmental improvements”. Greenpeace EU agriculture policy director Marco Contiero commented along the same lines, “the Commission’s plans offer almost no protection for health, the environment and climate”.

So, what is behind Hogan’s claim of higher ambitions for the climate and environment?

First, the striking theme of the new proposal is increased flexibility for member states. Member states are expected to present their own Strategic CAP Plans with various components from a loose framework (see AN2/18). This offers an opportunity for member states that wish to increase their environmental ambition to do so. However, it also means that member states that do not have the environment particularly high on their agenda can design a national CAP with quite low environmental ambitions. How low the bottom floor is in the proposal is difficult to determine; this will be decided to quite a degree by the interpretation of details and how strict the Commission will be in their review of the national plans.

The green architecture of the proposed CAP consists of three building blocks: enhanced conditionality in pillar I, eco schemes in pillar I and climate/environmental schemes in pillar II. All three are compulsory for member states, but only the first one is compulsory for farmers.

The enhanced conditionality is what was previously called cross-compliance and sets minimum standards that all farms that receive direct payments under pillar I must comply with. The word “enhanced” refers to five new Good Agricultural and Environmental Conditions (GAECs). Three of these can easily be related to the practices included in the scrapped greening mechanism: GAEC 1 – maintenance of permanent pasture, GAEC 8 – crop rotation (to replace crop diversification), and GAEC 9 – maintenance of non-productive areas (to replace Ecological Focus Areas).
The other change is the addition of new requirements: GAEC 2 – to protect carbon-rich soils, GAEC 5 – to make compulsory the use of the new Farm Sustainability Tool for Nutrients, and GAEC 10 – a ban on converting grassland in Natura 2000 sites. GAEC 5 means that the need to have a nutrient management plan is extended to all agricultural land, not just land in Nitrate Vulnerable Zones, as is currently the case.

What environmental benefits these new requirements will entail depends on how they are more precisely defined by the member states. Previous evaluations of the cross-compliance mechanism have shown that interpretations into national standards can be very lax.

Eco-schemes are a new structure under pillar I. They are obligatory for member states, but they are not ring-fenced by provisions such as a minimum level of funding. According to the Commission they “will have to address the CAP environment and climate objectives in ways that complement the other relevant tools available and go beyond what is already requested under the conditionality requirements”. They could either be payments by hectare, as a bonus to the direct payments or as compensation for single implementations. The types of measures that are expected to occur under this scheme are similar to what have previously been seen under the Rural Development Programmes in pillar II. Important differences are however that the level must not be related to the cost for the farmer to carry them out (at least if they are area payments) and they will not need to be co-financed by the member states like the pillar II schemes.

Agri-environmental-climate measures (AECMs) will still be around as an obligatory element of the member states’ Rural Development programme under pillar II. One concern is that the money for Pillar II will decrease during the next CAP period and of course threaten the funds allocated to AECMs. However, if member states wish to be ambitious the Commission offers several solutions in their proposal. As with the present CAP it is possible for member states to move 15 per cent of the funding from one pillar to the other. In addition to this they are allowed to move an extra 15 per cent from pillar I to pillar II for interventions that address environmental and climate objectives. They can also top up pillar II with their own funding. Another option is to increase their co-funding of pillar II.  

For member states less concerned with the environment the Commission has designed three mechanisms to safeguard a lowest level of ambition: a minimum of 40 per cent spending on climate under the CAP, a minimum of 30 per cent spending on AECMs under pillar II and a no-backsliding requirement.

The 40 per cent spending on climate action can be seen as a bookkeeping exercise, where “climate action” is interpreted broadly and weighted accordingly:

• 40% of the area payments under pillar I (since they are under conditionality)
• 100% for expenditure under eco-schemes
• 100% for expenditure for AECMs
• 40% for expenditure for natural or other area-specific constraints.

This could put some constraints on member states that want to prioritise coupled payments under pillar I and investment support under pillar II.

A requirement for a minimum of 30 per cent spending on AECMs under pillar II exists in the present CAP. What is new in the proposal is that expenditure on areas of natural constraints and areas with other specific constraints is no longer included. This should protect the present funding for environmental measures even if pillar II has shrunk.

Finally, there is article 92 in the Strategic Plan, which says that member states “shall aim to make … a greater overall contribution to the achievement of the specific environmental- and climate-related objectives” and they should explain in their strategic plans “how they intend to achieve the greater overall contribution” to those objectives.

The weakness of this phrasing is that member states only “shall aim”, while the term “contribution”, as explained by DG Agri officials, does not refer to monetary amounts or expenditure. The value of this article, if not strengthened, again depends on how strictly the Commission assesses the countries’ qualitative explanations.

Whether the proposal will be watered down or strengthened is now up to Council and the European Parliament. When the agricultural ministers met in mid-July they were more concerned that the “enhanced conditionality” would add to bureaucracy than they were about discussing its capacity to deliver environmental results on the ground.

Earlier in July the European Parliament appointed three rapporteurs. The ambition is to have a first reading before the European Union elections in May 2019. For the first time the Parliament’s environment committee has been given shared competence, as an “associated committee”, over the environmental content in the CAP.

Kajsa Pira

The content of this article is to a large extent based on two articles by Allan Mathews:
http://capreform.eu/the-greening-architecture-in-the-new-cap/
http://capreform.eu/the-article-92-commitment-to-increased-ambition-with...
The Commission’s press release, 1 June 2018:
http://europa.eu/rapid/press-release_IP-18-3985_en.htm