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A meeting of the Council of Ministers for Agriculture and Fisheries took place in Brussels on 21/09/2020, ministers exchanged views on a regulation on the CAP strategic plans, France presented a declaration on the need to develop plant proteins in Europe to reduce strong dependence on imports. The Czech Republic and Italy presented a set of desired principles related to the front-of-pack nutritional labelling, CZ also informed about a recent decision to ban the breeding of laying hens in cages and called on the European Commission to submit a proposal to ban the production of eggs from laying hens in cages in the EU by 2030. Germany presented the state of play of African swine fever in Germany and the measures taken, the Czech Republic presented a note on the situation in the pig farming sector calling the European Commission to provide a detailed analysis. Finally, the Commission presented the situation on the commodity markets and Spain reiterated calls for maintaining the current budget for the program dedicated to the outermost regions in the next MFF.
More information is available here.

In June 2020, the EP Committee on the Environment, Public Health and Food Safety concluded cooperation with the EP Committee on Agriculture and Rural Development on negotiations on the form of the CAP reform. The CAP negotiations are therefore now taking place at the level of the European Parliament's political factions, in two steps. As a first step, each of the five main political factions (EPP, S&D, Renew, ECR and the Greens) will draw up its own opinion summarizing its own priorities for the CAP, followed by a meeting of the political group to find a compromise. The compromise text of the proposals should then be submitted to the plenary of the European Parliament in the second half of October 2020. The political factions are currently finalizing the first step and preparing for the joint negotiations on compromise texts. Currently, the situation is as follows:

EPP - the largest political faction proposes to introduce a single percentage allocation for environmental and climate measures under the CAP (it would not be introduced at the level of individual pillars, but at the level of the overall CAP budget) called the Global Environmental Budget (GEB). The GEB would cover the mandatory 5% for areas of ecological interest (EFA), eco-schemes, protein crops, the beekeeping sector, agri-environmental measures for sustainability and climate change mitigation and adaptation, areas with natural or other specific constraints (ANC), or advisory systems in the field of strengthening environmental and climate performance. Basic Income Support for Sustainability (BISS) should be excluded from the GEB. The total amount of GEB could reach 30 to 35% of the CAP budget. According to the EPP, the area of EFA in the Member States should reach 8%, eco-schemes should be mandatory for Member States. For the time being, the EPP supports the possibility of choosing between capping, degressivity and redistribution of direct payments. At least 5% (or 7%) of the envelope for direct payments should be earmarked for redistributive payments, capping should be implemented for amounts above €100,000. It will be possible to deduct 50% of labour costs, eco-schemes, and support for young farmers from the capping. If Member States release at least 10% (or 12%) of the envelopes for direct payments for redistributive payments, they do not have to implement mandatory capping.

S&D - the second largest political faction has so far completed only the section devoted to green architecture, so its position on the capping is unknown. S&D supports the allocation of at least 20% of the first pillar envelope to eco-schemes in 2023, 30% in 2025, and the resulting 40% of the first pillar envelope in 2027. Farmers who employ illegal workers or who infringe workers' rights should be excluded from the payment of direct payments. For environmental and climate measures in the second pillar, 35% of the envelope for the second pillar should be allocated. Thus, S&D does not support a single percentage as EPP.

Renew - Renew Europe, like S&D, favours the allocation of funds for environmental and climate measures in the CAP individual pillars separately. A total of 30 to 40% of the budget for the first pillar should be allocated to eco-schemes. Within the second pillar, 30% of the envelope should be set aside for environmental and climate measures if a maximum of 40% of the ANC areas are included. If the ANC areas were counted from 100%, then the allocation for environmental and climate measures should be 40% of the envelope for rural development. Regarding capping, Renew is likely to support the position of the EP Committee on Agriculture of April 2019, i.e. the choice between mandatory capping or increased redistributive payment. Coupled support (VCS) according to Renew should reach 10 to 13% + 2% for protein crops.

ECR - The ECR faction is likely to emphasize maintaining a strong envelope for basic income support for sustainability to provide farmers with an adequate income. The ECR will support the exclusion of EFAs from mandatory cross-compliance but is also more in favour of the voluntary introduction of eco-schemes, for which 20% of the envelope should be set aside in the first pillar. Member States should be allowed to adapt eco-schemes to local needs.

Greens - The Greens' political faction emphasizes in its opinion that the CAP is an important tool for achieving the objectives of the European Green Deal, the Farm to Fork, and the Biodiversity Strategy. CAP direct payments should be paid more fairly, the shift from the payment of direct payments per hectare to the payment per unit of work should be encouraged, considering environmental efforts. The Greens are proposing a gradual progressive degressivity of direct payments, which should start at EUR 35,000, with the funds thus obtained going to eco-schemes. Full mandatory capping could probably be supported at €50,000. 50% of the envelope for the first pillar should be allocated to eco-schemes, and 50% of the budget for the second pillar should also be allocated to environmental and climate measures. For animal welfare and food safety schemes, 5% of the corresponding envelopes should always be allocated.

Last week, Irish Trinity College professor and CAP expert Alan Matthews criticized the German presidency's proposal to use unspent funds allocated to eco-schemes. Germany, like the Commission and some political groups in the EP, supports the setting of a minimum allocation of funds for eco-schemes in the first pillar of the CAP. The amount has not yet been set, but Germany is already considering the possibility of allowing transfers of unused funds that will be allocated for eco-schemes to the envelope for other direct payments (DE proposal is available here). Alan Matthews, however, rejects the proposal, saying that eco-schemes would then become a mere form of greenwashing, essentially a mere media bubble created to convince the public of a positive environmental policy direction, although the reality is quite different. According to Matthews, the proposal would allow Member States to increase basic income support for sustainability (area payments) from the funds allocated to eco-schemes.
More information is available here.

Last week, the German Presidency formally proposed to allow the payment of support from the recovery plan to farmers from next year. The European Commission has proposed that the disbursement be linked to the new CAP, which in the case of a two-year transitional period would not release aid until 2023. To release funds immediately to farmers, Germany has proposed making a total of €7.5 billion available in 2021 and 2022. The funds should be released gradually, €2 billion in 2021, and the remaining amount in 2022. The proposal is now being discussed, the discussion is also linked to the negotiations on the transitional period of the CAP and to approve the multiannual financial framework and the recovery plan.

Representatives of some Member States called on the Commission to provide additional information and to carry out impact assessments on the implementation of the objectives of the EU Biodiversity Strategy, even before the states commit themselves to the objectives of the new strategy. The new strategy proposes a few objectives, including expanding the area of organic farming to 25% or expanding the area for non-productive elements to 10% of the area of agricultural land. Reduction targets include a 50% reduction in pesticides, a 20% reduction in fertilizers, and a 50% reduction in antibiotics. Representatives of some Member States stated that it was not possible to commit to objectives for which no impacts, methodologies or specific rules were discussed. Member States are also asking the Commission to provide information on how the implementation of the new nature conservation and restoration objectives will be financed.