The CAP Reform Process
The EU budget debate
The debate on CAP reform post-2013 is inextricably linked with the negotiations on the next EU multiannual financial framework (MFF). The MFF (previously known as the 'financial perspective' but renamed in the Lisbon Treaty) defines the framework for the Community's budget priorities over a period of several years. It describes over different budget headings the maximum amounts (ceilings) of commitment appropriations (financial commitments) for each year. It is not a fixed multi-annual budget per se. The annual budget procedure still determines the actual level of expenditure and the breakdown between the various budget headings.
Substantive changes to the CAP are widely anticipated following the conclusion of the current financial perspective in 2013. There seems to be general agreement, given the fiscal difficulties facing many European governments, that the overall size of the EU budget (defined as a proportion of EU GNP) will not increase. This means that the debate will largely be about the priorities for the EU in the next financial perspective period and how much the composition of EU budget expenditure should change to reflect these priorities.
The share of the EU budget devoted to agricultural and rural development has gradually fallen but it will still account for over a third by 2013. Thus, if funding is to be found for new challenges and new responsibilities facing the EU within a fixed budget ceiling, funding for the CAP is an obvious source. This could be found either by reducing farm payments or by re-nationalising the major share of these payments by removing them from the EU budget and making them a Member State responsibility.
Shaping the CAP post-2013
The debate on the shape of the future CAP has already begun. The Agricultural Council devoted a number of meetings under successive Presidencies to identifying areas for possible reform, without however reaching any binding agreements. The new Commissioner for Agriculture and Rural Development Dacian Ciolos, organised a public debate and consultation on the CAP which ran from April to June 2010 and culminated in a two-day conference in July 2010. The debate centred on a common agricultural policy is needed? What do citizens expect from agriculture? why reform the CAP? what tools are needed for the CAP of tomorrow? The synthesis of the public contributions (PDF) provides a fascinating insight into the diverse responses to these questions. It is clear that Ciolos is seeking a new justification for CAP spending as the legitimacy of the existing CAP payments to farrmers is increasingly questioned.
Environmental organisations have argued that the main justification for payments to farmers should be the production of public goods, particularly environmental public goods such as biodiversity, landscape features, habitats or flood resilience.Farm organisations argue that direct payments play an important role in securing both the level and stability of farm incomes. However, there are significant differences in the share of the Single Farm Payment in farm incomes across Member States, from around 10% in the Netherlands to over 100% in Finland.
The next steps
Under the Lisbon Treaty, the Parliament for the first time will have equal powers with the Council in shaping the future CAP. The Parliament has already adopted a resolution on the future CAP on the basis of a report drawn up by rapporteur George Lyons. The Parliament resolution underlines that the funds allocated to finance the CAP must be "at least be maintained during the next financial period" (from 2013). In addition, agriculture policy should not be "renationalized" (i.e. returned to national control) and direct payments to farmers should be fully funded from the EU budget to avoid any co-financing by governments that could erode fair competition within the single market.
The Commission has indicated that it will publish its Communication on the future of the CAP post-2013 in November this year with legislative proposals to follow in mid-2011. These proposals will go to the Agricultural Council (representing the Member States) and the European Parliament.
Links:
Institute for European Environmental Policy blog Debating the Future of the Common Agricultural Policy
The IEEP blog is an excellent current source of commentary on the CAP reform debate. The site also provides access to IEEP briefings on CAP reform as well as to a library of reports and documents produced by other organisations.
European Centre for International Political Economcy Reform the CAP blog
A partisn blog with a focus on issues, policies, actors and strategies for CAP reform
CAP Reform Website
Useful website for news, views and analysis relating to the European Union’s CAP and specifically the ‘Health Check’ scheduled for 2008. The website brings together the work of researchers, activists and analysts from across Europe and elsewhere.
Euroactiv – Common Agricultural Policy Website
Comprehensive website on CAP Reform with news, links and analysis
Resources:
Bureau, J. and Mahe, L., CAP reform beyond 2013: a proposal for a longer view (PDF), Notre Europe 2008
An influential study on options for the CAP post 2013 by two influential French agricultural economists
Iozzo, A., Micossi, S., &Salvemini, M., A new budget for the European Union? Centre for European Policy Studies, 2008
An interesting proposal to reshape the EU budget which highlights many of the issues which will feature in the discussions leading up to the next financial perspective.