Following this week’s Farm Council in Brussels, it is clear that momentum is building in the CAP 2020 discussions. As the CAP will be shaped by the budget, the publication of the budget communication last week will have been central to ministers’ deliberations.

The inevitable gap in the EU budget caused by the departure of the UK presents a completely new challenge of how to replace the approximate €12bn net contribution from the UK. This will happen during the next multi-annual financial framework (MFF), which will run to 2027 and coincides with a time when the EU has ambitions to do much more in the area of defence and refugees. Both have huge budget implications.

Budget

In his communication, which is basically an outline plan, the European Commissioner for Budget and Human Resources Günther Oettinger has suggested an increase in member state contributions from 1% of national GDP to between 1.1% and 1.2%. In terms of expenditure, he is suggesting the Brexit deficit is met by dividing it, with half achieved from savings and the other half met by the introduction of new money. For the new EU initiatives, he is of the view that these should be 80% funded by new money, with the other 20% coming from savings in existing areas of expenditure.

A specific section is dedicated to CAP as it is still a huge part of the overall budget, accounting for 38% of expenditure. One of the three options suggested is a 30% cut, which has caused farmer outrage across the EU. It also considers a 15% cut and the best option that was offered was maintaining close to the present level of funding – there is no proposal to even consider an increase.

CAP 2020 ambitions

Commissioner Hogan’s CAP communication has been in circulation since the end of November and a number of the themes are being focused on. The current Bulgarian presidency tabled a series of points for ministers to consider, with a fairer and more effective outcome for farmers top of the list.

It is a regular criticism of the CAP that 80% of the money goes to just 20% of farmers, which benefits large landowners in an EU where half of all recipients have five hectares or less. On the other hand, many of the eastern European countries that had large collective farms under the old Soviet political system will be big losers in any capping of payments. Part of the positive dialogue is that if the CAP can hold on to its budget, a targeting of small and medium farmers could enable a modest increase in the money they receive.

It has always been clear that CAP 2020 would be aiming to raise the bar on environmental performance higher. A basic standard of compliance with environmental standards looks like it will be a qualifier to obtain a BPS with what are described as opportunities to obtain extra payments for more ambitious environmental plans in Pillar II. Young farmers and farmers who are described as earning their living from farming are also the targets of CAP 2020 and, again, these themes received widespread support from across the council.

Minister Michael Creed, who represents Ireland on the Agriculture and Fisheries Council, was broadly supportive of the sentiments around what is envisaged in CAP 2020. He and his Department colleagues will bring their series of consultations to an end this week with the last meeting in Claremorris on Wednesday evening. His angle, when speaking in Brussels, was that he was “supportive of the Commission’s efforts to better target direct payments” but he went on to point out how different agriculture was across member states and they should have the flexibility to decide how to improve the targeting and fairness in their own country.

Comment

The debate on the 2020 CAP and its funding is now getting up to full speed. So far, there is a degree of unanimity but that is possible when debating general principles as opposed to specifics. We can expect the debate to heat up when it comes round to choosing a number at which point payments will not be allowed to cross or what exactly is required in a more ambitious environmental policy. It is a well-worn cliché that the devil is in the detail, but that is the way it always is with CAP.