EU Parliamentarians Approve Farm Policy Reforms

13 March 2013

In a plenary session earlier today, European parliamentarians voted on proposals for reform of the EU's controversial Common Agricultural Policy, in the latest step towards defining the shape of the post-2013 farm subsidy framework.

"Today we have struck a proper balance between food security and improved environmental protection, so that the new EU farm policy can deliver even more public goods to EU citizens," the parliament's Agriculture Committee chair Paolo De Castro said following the vote.

He added that the new scheme "must be made less bureaucratic and fairer to farmers, not least to empower them to cope with crises."

The plenary vote rejected certain aspects proposed by the parliament's agriculture committee, reverting in some areas to measures initially put forward by the European Commission, while maintaining other measures that the agriculture committee had recommended. (See Bridges Weekly, 30 January 2013)

While environmentalists, development groups, and others had called for the reform to reorient farm support around environmental protection, farm lobbies argued in favour of retaining historical subsidy levels while minimising new "green" requirements.

The EU farm group COPA-COGECA broadly welcomed the vote. Copa President Gerd Sonnleitner said in a statement that the decision is "a good basis to work on and marks a key step forward in the EU decision process."

"Re-coupling" support to production?

The plenary vote maintained a proposal from the parliament's agriculture committee to allow EU member states to provide "coupled" farm payments, where subsidies are linked to the type or volume of production, up to 15 percent of the "national envelope" available to the government. The move would allow larger amounts of trade-distorting support to be provided across all farm sectors, said sources familiar with the process.

Some farm groups expressed concern about the move. "We were hoping it would be brought down a bit," said William Surman, a Brussels-based spokesperson for the UK farm group NFU. He told Bridges that the coupled payments disadvantaged more competitive farmers by distorting markets.

Public health groups expressed particular concern over the possibility that tobacco producers could benefit from coupled payments. "People living in Europe expect politicians capable to withstand narrow interest groups and stand up to protect their health and well-being," said Monika Kosińska, Secretary General of European Public Health Alliance, in a statement.

Weaker "greening" measures maintained

The plenary vote also maintained the agriculture committee's proposals to introduce more flexible "greening" measures as a condition for farmers to receive direct payments, and for these to be voluntary.

Instead of protecting "ecological focus areas" equivalent to seven percent of farmland, as originally proposed by the European Commission, the plenary accepted proposals put forward by the agriculture committee that would begin from a lower level of three percent in the first year, followed by gradual increases and a review. (See Bridges Weekly, 30 January 2013)

However, environmentalists welcomed a move to tighten rules on which farmers could be considered "green by definition." While the Commission had proposed that only organic farmers would be covered by this clause, the agriculture committee had sought to expand the category to cover a menu of other farm practices - a move rejected by the plenary.

"The European Parliament has defused some of the worst counter reform proposals that came out of the Agriculture Committee, but has managed only partial damage control," argued Trees Robijns, Agriculture and Bioenergy Policy Officer at BirdLife Europe.

Double-funding: plenary rejects paying farmers twice over

The plenary vote overturned a change introduced by the agriculture committee that would, in effect, have obliged the EU to pay farmers twice for the same environmental action - a clause that some argued would be illegal under the bloc's own rules, as well as inefficient.

The double payment would have arisen as a result of the subsidies farmers receive under future direct payments that would be linked to environmental performance, as well as those they receive under agri-environment schemes that are funded separately.

A number of MEPs issued statements welcoming the move by the plenary to modify the proposed new rules in this area.

Production quotas: sugar extended, dairy to end

The plenary vote approved the proposal from the agriculture committee to maintain sugar quotas until 2020 - although the Commission had favoured ending them five years sooner.

In contrast, dairy quotas would not be extended beyond 2015, although some MEPs had reportedly sought to phase them out more slowly. The vote approves proposals put forward by both the Commission and the parliament's agriculture committee.

Export subsidies maintained

Despite an opinion from the parliament's development committee which had called for agricultural export subsidies to be phased out (see Bridges Weekly, 27 June 2012), the plenary maintained the possibility of using this instrument under the policy's next seven-year cycle.

Some MEPs expressed their frustration with the move, with the Dutch Green agriculture spokesperson Bas Eickhout observing that "MEPs regrettably voted to maintain the damaging export refunds instrument which dumps EU farm products onto fragile markets in developing countries."

Cap on payments to large farms

The plenary vote maintained a proposal that would cap subsidy payments to the largest farms. Successive attempts to introduce similar caps in previous rounds of CAP reform have been unsuccessful, although the agriculture committee this time supported a bid from the Commission to introduce a new ceiling for payments.

While the move has been supported by socialist MEPs in particular, some continue to argue that the proposals on the table would be weak and largely ineffective.

"Capping direct payments to any one farm at €300,000 is too high and means continuation of unfair distribution of public funds to big players," cautioned Karin Ulmer, senior policy officer at the development agency APRODEV, in an email to Bridges.

Next steps

Under co-decision rules agreed under the EU's Lisbon Treaty, the European Parliament, European Commission, and ministers in the European Council must all reach agreement on the reforms before they can be finalised and adopted.

Farm ministers from the bloc's member states are due to meet to discuss the CAP reform process on Monday and Tuesday next week.

Farm groups expressed hope that an early accord could be found. "I urge EU farm ministers next week to agree their position on the new CAP so that negotiations can commence between MEPs, EU farm ministers, [and] the EU Commission to reach a final agreement by June," Sonnleitner said.

A press release from the European Parliament said that the three-way negotiations would begin in late March or early April.

ICTSD reporting.

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