By Steve Gillman
The Institute for European Environmental Policy (IEEP) analysed the CAP’s new plan to increase environmental action and found it falls short on the ambition and finance needed to shift EU agriculture towards a sustainable future.
In June 2018, the European Commission released plans for the next CAP which outlined a new way for member states to approach the environmental and climate challenges their countries face. The Commission proposes to replace the current green payments with ‘eco-schemes’ that are tailored by national governments, which Brussels hopes will translate into better action on the ground.
It is a shift away from the current system that reward farmers for the climate-friendly practices decided at an EU-level. These payments have been plagued by criticisms since their inception – farmers claimed they were too complex and negatively affected their income while environmental organisations blamed them for failing to deliver a positive impact.
In the CAP 2021-2027 report (above), IEEP analysed these eco-schemes as a solution to deliver positive environmental and climate action. The think tank found that eco-schemes could indeed be an effective tailored approach, but in their current proposal they contain structural flaws that will limit their ambition and ability to drive change and deliver impact.
IEEP see the financing behind the eco-scheme as the ‘single greatest weakness’. They acknowledge there is considerable investment available for eco-schemes, but the lack of a minimum spending requirement could result in member states not investing enough to deliver the necessary shift to a more sustainable agricultural system.
Currently, 30% of all direct payments must be paid to farming practices that benefit the climate and environment. If there is any hope for eco-schemes to deliver the needed impact IEEP believes they should be building upon this threshold, at a minimum.
Instead, the new flexible financing model could end up creating competition between different sources of funding within the new CAP. This could undermine eco-schemes as countries may end up prioritising finance for production or income over the environment and climate action, particularly as the CAP’s overall budget faces huge cuts.
Alan Matthews, Professor Emeritus of European Agricultural Policy at Trinity College Dublin, does say that the new CAP’s design should not result in less financing for environmental and climate action than the 2014-20 period, assuming it survives the European Council and Parliament. But he also sees this bar as being too low to address the sustainability challenges facing EU agricultural production. Similar fears were echoed by the International Panel of Experts on Sustainable Food Systems
Trajectory of inaction
Regardless of the level of finance, member states will be required to implement an eco-scheme, but IEEP, along with the European Greens, still fear inaction because it is voluntary for farmers to sign up.
As a result, positive environmental impact may end up more dependent on the ambition and implementation of the member state, which raises the question how the less motivated countries or regions will design and roll out eco-schemes. Without adequate support from the government, a vacuum of ambition could ripple down to farmers who don’t see the benefits of signing-on and therefore fail to adopt greener practices.
To galvanise environmental ambition, the European Commission will require member states to explain in their eco-scheme proposals how they will contribute in achieving existing national environmental or climate targets. They will also offer a performance bonus in 2026, equal to 5% of the total finance allocated in 2017, to member states that show significant performance against these targets.
But IEEP criticise CAP’s overarching objectives as being too ‘vague’ for member states to strongly link them to other EU environmental legislation. There is also no requirement forcing governments to translate the overarching objectives into more targeted ones respective to their country. Addressing both issues could ensure a stronger commitment in delivering environmental impact.
Overview of proposed CAP general and ‘specific’ objectives
IEEP see an opportunity in linking eco-scheme targets with existing binding and non-binding legislation, such as those under other EU environmental directives or policies like the EU Biodiversity Strategy. Intertwining targets like this could see governments more motivated to utilise all the financing available under the CAP for environmental purposes. However, the think tank fear the mind change required for this would take too long to materialise and is probably not a realistic option.
In terms of evaluating the eco-schemes progress on environmental action, IEEP say that the European Commission will only be looking at indicators related to the number of hectares or number of beneficiaries enrolled. Here, the IEEP would prefer to see more specific indicators linked to the eco-scheme in order to create a more performance-based CAP.
To address all of the above IEEP envision a solution where every farmer would have their own sustainability plan developed with an accredited farm adviser. As part of this farmers would set a baseline which they would work from and gradually build upon, releasing steady green finance as they move up each step of the journey. IEEP think this approach could help farmers focus more on improving their performance without worrying too much about maintaining income and which action is funded by which fund and by how much.
But, in its current proposal, the IEEP fear that the eco-scheme will be an isolated aspect of the next CAP, rather than a core component that could drive change. Combined with the issues around finance and ambition, IEEP say the new CAP lacks the ‘teeth’ and will struggle to shift European agriculture towards a more sustainable future.
IEEP’s proposed framework for a more effective eco-scheme: three main recommendations:
- Ensure that the eco-scheme is well targeted and tailored, and backed by a strong budget in order to deliver a higher level of ambition for environmental and climate action.
- Ensure that there is complementarity between the eco-scheme and other related CAP instruments including key elements of the green architecture
- Ensure that planning and performance under the next CAP is participatory, transparent and evidence-based to effectively address key environmental and climate challenges