Working document on the Future of the CAP after 2013
Committee on Agriculture and Rural Development
As the 2013 deadline is fast approaching, the European Union three institutional clusters (European Parliament, Council of Ministers and Committee) are, each on their own, outlining their vision of the future CAP. While the Committee must present its own version this fall, the Spanish Presidency kicked off the process with the February 15 publication of a working paper , which was handed out before the February 22 Council of Ministers of Member States and emphasizes price volatility and the regulation instruments to stabilize markets. This represents a genuine progress, compared with the two previous presidencies that focused on rural development for the Swedish presidency and on the SPS for the Czech presidency. The avenues explored by Spain are clear, since four key topics are listed in the document conclusions:
Lastly, on March 1, the European Parliament––the third key player in the European institutional tripod––also published the first elements of analysis and structure for the future initiative report on agriculture. Following the ratification of the Lisbon Treaty, the Parliament benefits from strengthened legislative powers, a fact that opens up new negotiation prospects. This is the reason why we decided to present excepts from this latest working document, which was prepared under the sponsorship of George Lyon, MEP and Rapporteur, and whose main founding strategy and principles are very similar to momagri’s ideas.
- Do you consider that the market orientation of European agriculture is adequate?
- Do you consider that existing market management tools provide an adequate safety net in a context of increased volatility? How could we improve on the current situation?
- Do you consider it pertinent to examine tools in addition to those planned by the single CMO? Which ones? How?
- Do you think that the future CAP should have a financing mechanism to deal with situation of serious crises, and thus offer the necessary flexibility to act rapidly in such cases?
Momagri Editorial Board
« Working document on the Future of the CAP after 2013», George Lyon, March 1, 2010
The structure of the first INI-report on the future of the CAP - key elements:
1- The evolution of the CAP: from market-distortion to market-orientation
Your rapporteur would like to make clear that the CAP has been largely successful so far in delivering the objectives it was assigned over the reforms. Indeed, the various reforms have brought to an end the so-called 'milk lakes' and 'butter mountains', by reducing market-intervention, European agriculture does not dump its products on world markets anymore, and it has now made a resolute move away from heavy price and production support with the introduction of decoupled direct aids for farmers, in line with WTO requirements. It will also be recalled that Pillar II objectives are now an integral part of the CAP, most in line with societal demands and recognising the multi-functional role of EU farmers.
It should also be pointed out that the CAP share of the EU budget has been cut from 75% to around 40% today, representing no more than 0.45% of total EU GDP expenditure, while the number of farmers has doubled with the accession of the 12 new Member States.
2- The challenges a CAP post-2013 must respond to
Your rapporteur, in this section, proposes to highlight the main challenges a future CAP will have to respond to:
In the light of these challenges, your rapporteur believes that a strong, sustainable, well-supported and credible multi-functional food policy will provide answers to both rural communities and the wider society.
- Food security with the growing world population (from 6 to 9 Billion by 2050) and the associated growing demand for food, especially from emerging countries, against the background of greater pressure on the environment (land, water, energy)
- EU agriculture vulnerability to the impacts of Climate Change and the deterioration of the environment over time
- Economic crisis as an immediate challenge (lack of access to credit, constraints on public spending, increasing unemployment)
- EU consumers' high expectations for food quality, animal welfare standards, and good value for money
- EU ageing rural population and the threat of land abandonment and rural depopulation
- Growing market price volatility and the global energy crisis
Your rapporteur would like to hear the views of the members of the Comagri on this, in order to ensure an exhaustive and well-prioritised list of challenges to be taken into account.
3- The need for a strong CAP post-2013
A. Supporting economic needs
Your rapporteur believes that a solid EU common agricultural policy is needed to ensure:
B. Responding to social concerns
- A competitive EU agriculture on world markets
- EU food security in an unstable world context
- The valuable contribution EU agriculture and the downstream agri-food sector make to EU growth and employment
- Corrections to market failures such as exposure to natural disasters, high risk and price volatility, lack of demand elasticity, farmers' position as 'price takers' in the food chain, etc.
- A well-functioning Single Market and a level playing-field for farmers to operate under fair competition conditions in the EU market
Your rapporteur also believes that the social dimension of the CAP must continue to address the following major concerns:
C. Delivering benefits in terms of Public Goods
- Lower income than the EU average for farmers in most member States, and decreasing farmers' income (average -12.2% last year in EU-27)
- The need for a sustainable, dynamic and balanced socio-economic development of the European rural communities when agriculture remains the main land cover occupying 47% of the EU territory
- The need to attract young generations in rural areas and activities, and tackle rural unemployment
Your rapporteur believes that farmers should be recognised as main providers of Public Goods that the market fails to reward them for, and should be encouraged in their pursuit of a more sustainable future, higher quality production, and better animal welfare conditions. Their function of landscape managers should be duly recognised as contributing to the European great cultural value and diversity.
Your rapporteur also shares the view that farmers should be rewarded for delivering more environmental benefits in the future (such as soil preservation and restoration, quality water management, preservation of farmland biodiversity). They should also be incentivised – technically and financially – to mitigate the impacts of Climate Change by reducing their GHG emissions, improving carbon soil sequestration, using more renewable energy sources and exploiting the potential of biomass and biowaste for energy production.
Your rapporteur wants to recall at this stage that the costs of the CAP are nothing in comparison to the social, economic, and environmental costs of a left-alone European agriculture which will never be able to address future challenges in an appropriate manner. Only a strong and well-supported CAP can deliver such diverse positive externalities.
4- Looking ahead: future CAP priorities
Your rapporteur, in this section, aims at defining and articulating the main priorities for a 'fairer, greener and more sustainable' CAP in the future. The following priorities could be articulated as such:
- EU food security, safety and quality at the heart of the future policy design
- Competitiveness of EU products in the world as a fundamental objective
- A fairer CAP:
- Fair standard of living for farmers and fair return for consumers,
- Strengthened market power for producers in the food supply chain,
- Market volatility management and rapid action tools for potential crises,
- Fair treatment for farmers in all member States in the context of the budget review, when deciding on the size (the current budget amount should be kept) and the national allocation of the budget
- A greener CAP:
- Maximisation of the delivery of environmental goods,
- More sustainable use of scarce resources to improve production efficiency,
- Realising agriculture's potential to tackle Climate Change
- Strengthening of rural communities by creating more jobs opportunities
- A Common policy to ensure a well-functioning Single Market and address the cross-border dimension of food supply, climate change, high food standards
- An outcome-driven future CAP, with special attention for simplification and reduced administrative burdens