The Great Simplification Scam

Simplification of the CAP is a hot topic at the moment, and will be until at least May. At the most recent Agriculture and Fisheries Council meeting (19/03/2015) “ministers exchanged views on their experiences in the implementation of the new Common Agricultural Policy (CAP). The most important issues highlighted as needing simplification in direct payments were the ‘greening’ measures and the controls.”

Minister Jānis Dūklavs recalled that “member states supported the efforts of Presidency to agree Council conclusions on CAP simplification in May. Some of the issues raised by the member states require urgent attention as rules will have to apply on the ground already this spring. There are some areas where simplification might be possible through minor amendments to the existing provisions established by the Commission”

The momentum for simplification comes from the Commissioner Hogan, who emphasised it in a December speech: “We need to simplify our rules now and cut red tape in an effective way” he said, promising to have made progress within a year. In this speech he asked for submissions on the subject. But what is simplification, what does it mean, if anything?

Simplification in theory sounds fine. Make life simpler. How could anyone be against that? Indeed every new Commissioner promises it when they start, a sort of ‘mom and apple pie’ promise of an easier life.  The fear is, however, that the simplification is code for getting rid of environmental and other public goods, leaving farmers and the sector in general to do as they please, unencumbered. In a context of agri-food being so dependent on subsidy payments – that’s tax revenue from citizens, in return for better socio-environmental performance – simplification could be used to row back on the microscopically modest greening gains in the CAP reform débâcle.

It is also the case the those arguing for simplification most strongly – voices from the business-as-usual end of the agri-food sector – have also argued for exception after exception, for compromise after compromise – for national and regional rules to be allowable, over and above Common EU rules. And they achieved this by and large. This adds complexity, not simplification. And this is reflected in the requests for supposed “simplification” which often involve exceptions, which, inevitably make things complex again. Thus is the nature of exceptions.

A group of six Member State Ministers wrote to the Commissioner about simplification in late December. Worryingly, Greening was their main concern, and exemptions from the rules was their aim.

“We are particularly keen to engage with you as soon as possible on the requirements of Greening which are unfortunately complex. Therefore, we are asking the Commission to take a pragmatic approach to the interpretation of the Greening guidance as these requirements come into force next year.

More broadly on CAP Implementation, we look forward to working with you on how simplification can be achieved. Although some aspects of the new CAP are only just coming into effect, we believe that there is a strong case in support of an early examination of the rules and guidelines.

This could include:

• Taking into account the burdens imposed by Greening in the Delegated and Implementing Acts in your early review of Direct Payments

A review of the Delegated and Implementing Acts in 2016 taking into account – as far as possible – first results of the impact of all Greening requirements in 2015; and in turn lead to;

A fundamental review of Greening in 2017, in line with your commitment to a mid-term review of CAP.” (bold in original)

This letter comes with a table (at above link), and it reads like a charter for the evisceration of the idea and practice of Greening. Its as if farming did not depend – in some cases for the majority of its income – on subsidies paid to deliver a cleaner environment.

The table is full of the language of being supposedly proportionate and reasonable, of making exceptions, of reducing the number and scope of inspections. And of course, any issues with greening – failures in implementing greening due no doubt to confusion brought on by complexity – should not in any way impact on timely payments of subsidy money. Oh, and greening should probably be delayed anyway, because, yes you guessed it, its complicated.

Ironically and very obviously, its worth re-stating that proportionality and new exceptions increase complexity. In other words ‘simplification’ can be construed as code for neutering Greening, and not for making compliance easier.

These Ag Ministers have, it seems, a friend in Commissioner Hogan, who in that December speech, also said the following regarding direct payments and greening.

“I shall, of course, honour the previous Commission’s commitment to review, after the first year of application, the rules on the Ecological Focus Area.

I think, however, that we should not stop there. We should seize the opportunity to also simplify the other rules of the new direct payments regime, provided that we do not re-open the basic policy decisions of the 2013 reform in this area…”

Let’s look in more detail at just how dependent on subsidy payments farming in the EU actually is.  Complying with “red tape” can be seen in fact, as a core job as it pays so much towards the practice of farming.

According to Alan Matthews, “The average dependence of farm income in the EU on subsidies is now 58%” and in some countries, the dependence is stark: “countries where total subsidies were close to or greater than family farm income include Ireland (96%), Latvia (100%), Estonia (112%), Slovenia (156%), Luxemboug (169%), Czech Republic (177%), Finland (234%) and Sweden (236%)… he concludes by asking “can a system in which taxpayers transfer €63,000 each year to each farmer in Luxembourg be justified?”

Inevitably, individual agri-food sectors are more dependent than others, so for some categories of farmers, the figures are more extreme again. So the market is in fact the EU citizen taxpayer at least as much and in some cases more so than the purchaser of the actual food from the farm.

Yet in the Irish case, the Irish Farmer’s Association (IFA) in their submission on simplification, asked for a reduction in inspections, and an end  to on the spot inspections, replacing them written requests with 14 days notice. The largest farming sector in Ireland – livestock (beef and sheep) –  is also the most subsidy dependent.

Any one of these micro changes can seem reasonable taken in isolation, much like the changes suggested by the six ministers. However all the momentum, and the cumulative effect, seems to be towards destroying Greening’s greenness.

And in reality, Greening has already been watered down massively in any case. Greening as it stands will deliver little other than partially maintaining a status quo, but there seems to be little political or institutional momentum to make it work for what citizens actually want.

Luc Viatour Field in Hamois Belgium

EFAs – Ecological Focus Areas – are a case in point. In the final stages of the CAP reform débâcle, the ecological element of EFAs was significantly weakened. Nitrogen fixing crops, and the mineral fertilizers and synthetic pesticides which accompany them, were introduced as an allowable EFA category, and also made more attractive when the weightings were changed to make these crops more valuable in the EFA system. EFAs were supposed to be where agri and eco system services replenished, where nature could rejuvenate and then play its part, as it were, liaising with agriculture to make farming actually happen successfully and sustainably. Indeed pollinators are the perfect example of a conduit between nature and farming enabled by EFAs. Thus ponds, hedgerows, small forests, agroforestry, buffer strips and so on were considered EFAs. Actual crops and pesticides make a farce of this, as they are  indistinguishable from conventional farming, but were made allowable in EFAs.

Yet EFAs are still supposedly too restrictive, and are one of the contentious aspects of Pillar 1 of the CAP for many Ag Ministers and the lobbies behind them, as the letter from six Ag ministers shows.

Partly because of pressure from civil society, a meek fudge compromise allowed member states themselves decide what’s allowable as an EFA. Guess what? Almost all -of them 27 of the 28 Member States went for Nitrogen fixing crops. Indeed the latest evidence presented at this link by The Institute for European Environmental Policy (IEEP) is, essentially, a car crash of mealy mouthed watering down of the ecological components of the CAP by member states. When they got the option, too often, Member States have opted for weakening the socio-environmental dimension of CAP. This holds for Pillar 2 to 1 transfers, greening, degressivity and most significant areas.

Returning to the specifics of the Irish situation and the request for fewer inspections and for inspections with less power, its also worth remembering that 49.5% of Irish farms inspected under the nitrates directive failed the inspection. This is hardly cause for reducing inspections – the opposite could be argued in fact, until compliance rates improve. This improvement  may manifest anyway, as Ireland significantly increased the amount of Nitrogen allowable on the land, when current EU Agriculture Commissioner Phil Hogan was Minister for the Environment in Ireland, in 2013.

Certainly if you change the rules to match farming practices you will end up with more compliance. Yet the negative impact of this change on water pollution in Ireland  may be massive as the inevitable herd size increases unfold in the years ahead. Indeed the EU Commission said as much just last week. And it has taken Ireland years to in a limited sense  slightly improve its  water quality results.

Has it ever even been considered that stricter, more citizen and environmentally sound rules should be brought in to offset this never ending list of exceptions? Who at the institutional and political levels is making this argument, among all the arguments for weakening Greening, for bringing in exceptions and for reducing penalties?

Its as if the agri-lobby, Ag Ministers and the EU institutions operate in an echo chamber, cut off from the reality of ecological calamity and citizen concerns. We are living through a holoscene extinction – a biodiversity (read: life) wipeout on a par with the end of the dinosaur. We face runaway climate change and a myriad of other socio-environmental disasters and the answer is  – weaken the rules? How did we let this happen? How did we let those who profit from business-as-usual, but who rely on citizen tax revenue so much, get away with it?

So how about a quid pro quo. That for an exemption, an improvement must be made to counter the negative socio-ecological impact? That, for example, if exceptions or compromises are made on Ecological Focus Areas (EFAs) that crop rotations rather than just the crop diversification should be introduced to balance things out?

That this sort of thinking is not even on the agenda for the reviews of Greening speaks volumes on the real priorities of Ag ministers. And why is it only Ag Ministers who are inputting on this? Surely we need a coherent agri-food policy.

Or how about more results-based initiatives? In other words, pay farmers when they achieve certain outcomes, bonuses if they perform even better in socio-environmental terms, but  paid less – yes, less – if they do not achieve these outcomes. This gives farmers more autonomy, more justifiable flexibility to deal with realities on the ground, from soil to weather, and can also lead to better ecological outcomes. Some excellent examples are here.

Of course another type of simplification could be introduced: no exceptions, no compromises, stricter and more enforced rules. A one size fits all approach. That would be simple. But simplification is not what this debate is really about, is it?


Benny Haerlin on Phil Hogan and simplification

EU Commission on simplification

Alan Matthews on the long history of Commissioners talking about simplification in their early months in office

DG Agriculture Director of Economic analysis Tassos Haniotis says new CAP “won’t be simpler”