The long-awaited resolution of the deadlock over the future of European farm subsidies appears to be in sight. After lengthy and tortuous discussions, the European Commission, Council and European Parliament reached a political agreement on 26 June 2013 setting out the main parameters for the reform of the Common Agricultural Policy (CAP) from 2015.1 These are based, in large part, on proposals initially published by the Commission in 2011 and will have major significance for the way in which the adverse environmental impacts of intensive farming are managed and moderated in the future.
The need to 'green' the way in which the CAP operates has long been recognised, but reform has had a troubled history2 Under Agenda 2000 and the Mid-term Review of 2003, agricultural support payments under Pillar 1 of the CAP (market management) were ostensibly 'decoupled' from production within the new- single farm payment (SFP). The latter rolled all of the principal agricultural support schemes into one decoupled payment regime which applied to all agricultural products included in the arable crops regime, grain legumes, seeds, beef and sheep.3 The system is currently based on the allocation of a payment entitlement pei' hectare to each farmer. The reference amount was the three-year average of the total amounts of payments which the farmer was granted under the relevant support schemes in each of calendar years 2000, 2001 and 2002.4 This calculation generated a payment entitlement based upon that farmer's historic claim during the reference period. The Member States could opt to apply the single payment at a regional level5 and this was done in England (but not Wales).
Payments under Pillar 1 were also subject to 'cross-compliance' conditions intended to guarantee adherence to basic environmental management requirements in return for payment of income support.7 Cross-compliance currently consists of two separate elements:
(i) adherence to statutory management requirements relating to public, animal and plant health, the environment and animal welfare.8 The statutory standards relate to existing EC Directives such as the Wild Birds Directive of 1979, the Nitrates Directive of 1991 and the Habitats and Species Directive of 1992 and require farmers to comply with the provisions of national legislation implementing the relevant Directives; and
(ii) land that is no longer used for production purposes must be maintained in good agricultural and environmental condition (GAEC).9
Farm support for voluntary participation in agri-environment programmes (such as Entry Level and Higher Level Stewardship in England) is funded under Pillar 2 (rural development).
Further reforms have been under discussion for several years as part of the 'Europe 2020* reform process. It was hoped that the Europe 2020 Strategy*0 could lead to a more refined approach. The EU Commission document The CAP towards 2020u proposed the enhancement of the environmental performance of the CAP, through a mandatory 'greening' component of direct payments to support environmental measures across the whole of the EU.12 One suggestion was the proposed introduction of 'simple, generalised, non-contractual and annual environmental actions that go beyond cross compliance and are linked to agriculture - for example, permanent pasture, green cover, crop rotation and 'ecological' set aside'. The inclusion of the requirements of Natttra 2000 areas13 in this 'green' element of the direct support regime was also proposed.