Does the latest CAP proposal give more or less money to farmers than at present?

Under the latest proposal, the average farm payment would increase marginally from €14,400 to € 14,680.

The first proposals presented by Phil Hogan when he was European Commissioner for Agriculture in 2018 were for a €365bn CAP, a 5% cut on the 2014-2020 CAP. If we apply the 2018 values used in Hogan’s proposal, the latest offering tabled this week would leave €355bn to fund the CAP over the next seven years, less than the Hogan proposal, but an increase on the €329bn proposed in February this year.

If, however, current 2020 values reflecting the inflation of the past two years are used, then the value of the CAP over the next seven years is increased to €391.4bn, 2% more than what was in the 2014-2020 CAP, spread across the MFF or the EU budget for the next seven years. In an expanded MFF to €1,850bn, this leaves the agricultural share of the EU budget at just under 19% or half the share that the CAP had in the 2014-2020 MFF.

What are farmers expected to do to get the payment?

This won’t become clear until the Government prepares and submits the national plan for CAP delivery in Ireland. However, one of the basic rules will be that the replacement for the Pillar I BPS payment will have up to 40% of it calculated on the basis of environmental activity, similar to what was previously allocated as Greening in Pillar II payments. What’s more, most of the money that has been restored in the latest proposal from the European Commission is for Pillar II, which next time round will be for specific environmental programmes that farmers will have to apply for and under specific environmental works to get the payment.

There will be farmers that this won’t appeal to and they will lose out if they aren’t persuaded to apply and undertake these works.

What are national plans and why do they matter to farmers?

The EU has put in place an outline framework of what it expects from farmers across the EU in the Farm to Fork strategy (F2F).

It has targets such as the reduction of pesticides and use of antibiotics by 50%, fertiliser by 20% and an increase in organic farming to make up 25% of EU agriculture.

It is left to national governments to come up with a plan of how to achieve this in each individual country and present it to the EU for approval. This will be both controversial and an opportunity.

It means that the tough decisions on priorities for financial allocation will have to be made in Dublin, with issues such as defining what a “genuine farmer” is being problematic. It is also an opportunity for Ireland to decide how it wants to farm for the remainder of this decade with considerable scope for creativity if the will is there.

Will it mean Irish farmers have to reduce livestock numbers?

Less livestock is the fastest way for farming to reduce emissions but as of now there is nothing decided nor will the EU be making this proposal. If this were to become a policy, it would be presented by the Government as part of its plan.

Are there any opportunities for farmers?

From initial reading, farmers will see many negatives but it is a positive that there is acknowledgement for the role agriculture plays in creating carbon sinks. These don’t offset the output of methane but they contribute.

With plans that these will be funded by CAP plus private industries that have high emissions buying into them, then there could be a new category of farmer whose business is carbon.

Similarly, for lower-stocked farmers in more marginal lands where they are almost organic, it may be an option to go fully organic if the payments were attractive.

When will it take effect?

At the moment, this is just a proposal from the European Commission. It has to be approved by the heads of state and the European Parliament, and it is likely that securing this support will mean modifications. In terms of a timeline, the target is to have the MFF concluded this year to take effect from 2021.

Finalising the CAP and national plans will take much longer and it could be 2023 until it is in place.