Provisional EU deal could be big news for young farmers post 2018

Ciaran Moran

Ciaran Moran

Rules to simplify the EU farming policy were tentatively agreed by Agriculture MEPs and Council negotiators this week.

The provisionally agreed update of the Common Agricultural Policy (CAP) rules will be part of the final wording of the so-called Omnibus regulation, i.e. new law on EU spending.

Active and young farmers: More flexibility introduced

The deal gives Member States more flexibility to define an active farmer, i.e. a person eligible for EU farm subsidies.

EU funding would continue to be reserved for those who carry out the minimum farming activities.

But, as of 2018, national governments could relax existing requirements to make blacklisted entities, i.e. businesses by default not recognised as active farmers, eligible for EU subsidies, or even do away with the blacklist completely.

MEPs ensured that Member States would be allowed to increase young farmers’ top-ups from 25pc to 50pc of the basic payment entitlement, but within the same range of first hectares (25-90).

Young farmers could now benefit from the top-up for full five years regardless of when, during this period, they apply for it.

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Strengthening farmers in a fairer supply chain

All recognised farmers’ organisations would be allowed to plan production and negotiate delivery contracts on behalf of its members without falling foul of the EU’s competition rules.

Collective negotiations have so far been allowed only for milk, olive oil, beef, cereals and arable crops producers.

Better tools to face market and production risks

Farmers are set to get better tools to protect themselves from both market volatility and unforeseen production risks such as adverse weather conditions, plants pests or animal diseases.

To this end the agreement will:

  • introduce a sector specific Income Stabilisation Tool (IST) so that losses incurred by farmers could be calculated for the type of production that was hit and they could be compensated even if their other productions did not suffer,
  • update current rules for crop, animal and plant insurance, mutual funds and for the IST to increase compensations and make them accessible to more struggling farmers. For insurance and sectorial IST, compensation of up to 70pc (up from 65pc) should be available for those who lost more than 20pc (down from 30pc) of their annual production (for insurance) or income (for the sectorial IST). For mutual funds and the general IST the maximum level of compensation will be also increased from 65pc to 70pc, but it will continue to be available to those who lost more than 30pc of their annual production or income,
  • untie the Commission’s hands in times of crises by allowing it to move quickly with exceptional actions without the need to activate first the public intervention and private storage measures, and
  • allow Member States to grant coupled support to their ailing sectors, which are particularly important for economic, social and environmental reasons, regardless of whether or not they experienced a drop in their outputs. Coupled support is currently limited to sectors struggling with maintaining previous levels of production.

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