In a Common Agricultural Policy’s negotiation context, a new agreement on budget has been made to prepare the new reform for 2014-2020, creating a 13.7% decrease in comparison to 2007-2013’s timeframe.

The State and Government Chiefs  of the 27 Member States of the European Union agreed on February 8 to a budget of 362.8 billion euros for the Common Agricultural Policy (CAP), for 2014 to 2020. It is equivalent to a 13.7% decrease in comparison to 2007-2013’s timeframe (420.7 billion euros). 227.8 billion euros are appointed to CAP’s first pillar, 84.9 billion euros to CAP’s second pillar and an additional budget of 2.8 billion euros is foreseen as a reserve in case of any agricultural disaster. The reserve’s objective is to create a support in case of major disaster affecting agricultural production or distribution. It will contain the direct payments application at the beginning of each exercise, of a reduction in the financial disciplinary mechanism’s framework. The reserve’s amount will be directly registered on the annual budget. If it is not used for any agricultural disaster, this amount will be reimbursed as direct payments.

©Xavier Remongin/Min.agri.fr.

©Xavier Remongin/Min.agri.fr.

The French farmers will benefit of 56 billion euros for the 2014-2020’s timeframe for both pillars. The first pillar is mainly constituted of three policies: market interventions, coupled subsidies, and direct income support. The second pillar consists mainly of three axes:

  • Improving the competitiveness of the agricultural and forestry sector
  • Improving the environment and the countryside
  • Improving the quality of life in rural areas and encouraging diversification of the rural economy

Aid’s convergence between Member States:

The average amount of direct payments for the European Union by hectare in current price will be reduced for the considered timeframe. The direct support will be distributed more fairly between the Member States (the remaining differences in salary levels, purchasing power, agricultural sector’s production and input’s costs will be taken into account). This fairer distribution will be made while taking into account the CAP’s general context and the EU’s budget.

All Member States with a level of direct payments by hectare inferior to 90% of EU’s average will be reducing one third of their difference between the current level and 90% of the EU’s average for the next timeframe. However, all Member States should reach the level of 196€/ha in current price before 2020. This process will be financed by all Member States of which their direct payments’ level is superior to EU’s average, proportionately to their distance to the average.

Direct payments’ “greening”

Member States will have to devote 30% of their annual national upper limit to the financing of agricultural practices beneficial to climate and environment. A clearly defined flexibility is foreseen for Member States in their choice of equivalent ecological measures.

© Min.agri.fr

© Min.agri.fr

Aid’s cap

Member States will be able to introduce a direct payments’ cap in favor of important beneficiaries.

Fund transfer between pillars

Member States are free to appoint, according to their own wishes, up to 15% of their funds from the first pillar to the second, and vice versa.

 

The French Ministry for Agriculture, Food Industry and Forestry, Stephane Le Foll, will now lead to the negotiation on the CAP’s contents and define, after a dialogue, the implementation’s choices at a national level. Mr. Le Foll approaches this new stage with the will to promote a CAP that, from the first to the second pillar, will support growth and employment, strengthen livestock and favor the agricultural practices’ evolution toward more self-run and sustainable systems.