The future of the CAP to tackle climate change and promote rural development

June 15, 2018

The Common Agricultural Policy (CAP) is one of the European Union’s oldest policies.Founded in 1962 to support agriculture, over the years it has served to support European farmers, financially and politically, to preserve the rural landscapes and the many food varieties that characterize the old continent.

Agriculture today is a key sector for food security in the European Union, thanks to the 11 million farms which are present and the 22 million people who work regularly in this sector. Agriculture, however, is not only used to supply and guarantee access to food for European citizens, but also to protect biodiversity, conserve nature and natural resources. Despite this, the income of farmers continues to be significantly lower than in other sectors: on average it is estimated to be 40 percent less. 

The CAP as a support for agriculture
For this reason, the European Agricultural Policy has been a useful tool for supporting farmers over the years.The first pillar of the CAP plans to provide direct payments to guarantee farmers' income and to give economic value to those services that are not normally considered by the market, such as the maintenance of ecosystem services.It also regulates markets, to cope with declines in demand or uncertainty in production.The second pillar is instead linked to rural development, which aims to promote knowledge transfer and innovation in agriculture, improving its profitability and competitiveness and promoting innovative agricultural technologies and sustainable forest management. The European Union today supports farmers with 38% of its budget, but this represents only 1% of all public spending in the EU.

The future of the CAP after 2020
On 1 June, the European Commission presented the proposals for the reform of the Common Agricultural Policy valid for the period 2021-2027. The aim is to give greater autonomy to the Member States, while the funds made available will be adjusted, reducing them by around 5%. Small and medium-sized agricultural enterprises will be at an advantage, as the member countries will have to reserve a larger share per hectare of funds. At least 2% of the funds made available must be allocated to young farmers, while direct payments per farm will fall to 60 thousand euro, depending on the type.

What the public consultations have highlighted is the request by European citizens to raise agriculture to the role of environmental protection, to effectively address climate change and the loss of biodiversity. A recent report by the Crea (Political and Bioeconomic Center), in collaboration with WWF and entitled "Rural Development Policy for Biodiversity, Natura 2000 and Protected Areas”, explains that "farmers today have an extensive menu of measures and operations that can directly or indirectly contribute to the management of the Natura 2000 network or to the achievement of the objectives of the European and national strategies for biodiversity”. However, it shows how often these are underutilized “due to the unfavorable or perceived relationship between the financial amount of the award and the commitments required, both in terms of fieldwork and bureaucratic and administrative management envisaged for participation in calls for tender". 

Criticisms and concerns
There has been no shortage of criticism of the new Common Agricultural Policy, starting with the greater autonomy given to the Member States, which would put a strain on individual European markets and climate goals.  What is most worrying, however, is the reduction in direct payments, which in some cases could be reduced by 16-20 percent. This could lead to uncertainty in agricultural production and a massive exodus from rural areas. According to the Commission, however, greater autonomy will be balanced by the obligation of countries to allocate part of their funding to programs dedicated both to environmental measures (such as the protection of wetlands and peat bogs) and to climate measures.