The NFU was fiercely critical of the CLA’s proposals for CAP reform, published earlier this year. But what is the NFU’s stance and how does it compare? Tom Hind of the NFU and Christopher Price of the CLA set out their stalls on behalf of the two organisations.

Tom Hind, NFU head of economics and international affairs

“Barely a week passes without a new report on CAP reform as organisations, governments and academics seek to influence the thinking of the EU’s institutions before the European Commission publishes initial proposals at the end of the year.

The NFU believes it is vital UK farmers have a strong voice in this process, which is why we embarked on a major discussion with our members to shape our policy last year. Recently we published a “Green Paper” that sets out our emerging thinking.

Tom Hind 
Tom Hind says farmers must have a strong voice in CAP reform.

The CAP has undergone substantial reform over the last 50 years. However the policy continues to face substantial pressure on both the budget and the objectives of support. Some believe that the only way to defend the CAP budget is to join forces with environmental groups and paint the policy green.

However, the biggest factor that will shape the CAP is the enduring economic crisis which will put pressure on all areas of EU spending. The CAP needs to promote a productive, competitive agricultural sector that forms part of a new European economic model if it is to continue to justify a large share of EU spending.

We believe that the future policy must meet four clear principles:

1. It must be simple, rather than tied up in constraints and bureaucracy.

2. It should be focused on the market – seeking to make it function better rather impeding fair competition between farmers in different member states

3. It should seek to improve agriculture’s productivity and not impede its competitiveness

4. It is a CAP that does what it says on the tin – a common policy with common instruments and, critically, common funding.

We argue that the focus of the CAP after 2013 should be to sustain productive capacity so that Europe’s farmers can respond to the challenges ahead. Food commodity markets are likely to be more volatile, so the policy must also assist farmers in coping with major fluctuations in prices and income.

It is vital that the agricultural sector and the CAP are sustainable, economically, socially and environmentally, so genuine incentives are needed to help farmers improve resource management, adapt to climate change and continue to build on the success of agri-environmental schemes in improving the environmental performance of agriculture.

But the biggest challenge of the next period of reform will be to assist farmers to become more competitive and productive.

UK government policy argues that the best way to achieve this is to eliminate direct support payments by 2020 and to channel all remaining support into the delivery of public environmental goods. This view carries little support across the EU – most member states recognise that markets do not provide farmers with sufficient or even predictable returns.

For the NFU, decoupled payments paid to active farmers must remain a cornerstone of the CAP to help sustain productive capacity, provide farmers with a hedge against market volatility and offer some compensation for the higher costs of producing food in the EU.

However, we also recognise that the financial and political pressures on the CAP will inevitably mean that farmers are forced to become less reliant on public support. Therefore a major part of the debate has to be about the flanking measure the EU must put in place to improve the operation agricultural markets, eliminate the abuses of power in the grocery sector, and develop the position of farmers within the food chain so that they have a fighting chance of making a reasonable profit.

Christopher Price, CLA Head of Policy

“The CAP is going to change whether we like it or not.

Its share of the overall EU budget was under pressure even before the financial crisis, and this is set to continue, particularly when the new member states are demanding a far greater share of what money there is. And with a new commissioner from Romania, they will feel they have a good chance of success.

Meanwhile, society demands farmers provide ever more in the way of biodiversity, landscape and other environmental goods.

Christopher Price 
Christopher Price believes food production must be a priority in CAP reform.

What’s important, therefore, is that the farming organisations make sure that they are at the forefront of the debate, leading the argument and steering it in a way that properly protects the interests of Europe’s farmers.

There is absolutely nothing is to be gained by us burying our heads in the sand or complaining from the sidelines. After all, in seven of the past 11 years the UK’s total income from agriculture would have been negative without the single payment.

This is why for the past three years the CLA has argued for what we call a Food and Environmental Security Policy – a policy that promotes both food production and a high-quality environment; both, not one or the other, but with food first.

Food production is and must remain the absolute priority. If life get tough we must be able to feed ourselves – even if this means ploughing up permanent pastures

But a sustainable system requires us to balance the two. The free market may ensure we have sufficient food, but it will never, unaided, ensure we have the sort of environment that society demands.

It is too early to spell out all the technical details. These will need to be the debated and resolved over the next three years.

Nevertheless, we are in no doubt that the future CAP must have the following elements: policies to promote agricultural productivity and competitiveness; a basic decoupled payment scheme; tiered agri-environment schemes; ways of supporting marginal areas, and measures to promote wider rural development.

However, in the current political and economic climate, the farming organisations acting alone are unlikely to make much headway in securing this sort of policy.

To be listened to, we need allies. Thankfully, we have them.

Some conservation groups recognise the massive contribution farmers and other rural land managers make to the natural environment as an adjunct to their businesses. These conservationists are willing to join with us in making the case for farmers to be paid for providing environmental services, and paid in a way that will create proper incentives for farmers to choose to carry out proactive environmental management.

Inevitably, we will not agree with the conservationists on everything; there is much that they say with which we will fundamentally disagree. But on the issue of the overwhelming need for support a strong, common, well-financed, EU-wide Food and Environmental Security Policy we are united… and UK farming will be all the better for it.