Leaked document gives glimpse into CAP thinking

The leaked document from the EU Commission on reform to the Common Agricultural Policy is many things. It’s unofficial, it’s a draft, and it’s out of date – it was written in May. So the policy position inside Brussels may have changed considerably already.

But it is undeniably of crucial relevance to those whose businesses often depend on support from that RPA cheque. For all the caveats above, it provides a tantalising glimpse into Brussels’ recent thinking on CAP reform, and demonstrates how the “statement of intentions” published last November has moved into policy.

When Farmers Weekly interviewed EU commissioner Dacian Ciolos in January, he told us that British farmers could expect some form of capping to payments for the largest claimants. In his example, it is unfair that public money should be used to subsidise a 10,000ha farmer in Romania who scoops the money out of his farm to invest in his textile business (for instance).

Mr Ciolos is unquestionably right in this assertion that EU farm support should go to farmers. Which makes it all the more peculiar that the draft of the policy reforms fails to define who would qualify as an “active farmer” – one of the single aspects that many had feared would become significant.

Nor does this document attempt to define a “small farmer” – those who may qualify for special support under a reformed CAP.

Much has already been made of the suggestion that a 100% cap on payments is introduced at €300,000 (£263,287). Some form of capping might begin at just €150,000, potentially affecting some 800 off-farm businesses in the UK. But that the document also suggests that those businesses paying staff salaries and making social security payments would be able to mitigate the effects of capping is interesting. This is undoubtedly intended to avoid penalising large farming business who are significant rural employers. But it also seems a bafflingly complicated method of targeting support at genuine farmers – particularly given that an “active farmer” remains undefined.

A few things become immediately apparent upon examining this draft. The first is that Brussels seems to favour scrapping existing entitlements under the Single Payment Scheme and starting afresh.

Therefore, farmers would need to establish new entitlements to receive the proposed Basic Payment and the “greening” element.

Few will need reminding of the disruption caused in 2005 to markets for trading and letting land, when it became necessary to be in occupation of land for 10 months to establish entitlements. And it’s clear that a need for new entitlements could induce a scramble to occupy acres which could have acute consequences for landlord and tenant relationships.

Another peculiar factor is the greening element itself. If some environmental management elements are included in Pillar One payments, where does this leave existing agri-environmental schemes?

As one would expect, sight of this draft document raises more questions than it answers. The final draft of the legislation will not be published until this autumn. Until then, every farmer in Britain will have to watch this space.