CAP reform – what’s in store?

With the new EU policy regulations nearly finalized, and plans for implementation in different parts of the UK and Ireland well advanced, what are the implications for organic producers and what issues still need to be addressed? This session was organised by ORC
Nic Lampkin (ORC): chair.

Session summary

Representatives from the organic sector England, Scotland and Ireland and the Welsh Government provided an update on CAP negotiations and the likely impacts for the sector.

For Ireland it was highlighted that organic support will be integrated within an agri-environment scheme although individual producers will be faced with a barrier in terms of the amount of support available.

For Wales, it was pointed out that Glastir will contain an organic element, although Glastir may focus on only part of the farm. The Welsh Government is also looking at developing a marketing and farm planning budget for the organic sector and will encourage the co-operative linking of horticultural enterprises.

The Scottish Government is also planning to place organic support payments under existing schemes and is working closely with industry to look at what will work. Scotland is also looking to implement an advisory service, based on Farming Connect, and this will include an organic element. For England, it was pointed out that there will be no special schemes for upland or organic systems within NELMS (New Environmental Land Management Scheme) but organic will be a relevant option. For Pillar 2 funding in England, the Soil Association and others are trying to encourage a creative approach, although organic systems are still being questioned at a policy level. It was highlighted that the England OELS focused on remuneration for conversion and certification payments, whereas other countries in the EU realise that price premiums do not cover additional costs for producers and have increased support accordingly.

Across all countries represented at the workshop, the lack of support for the development of viable conversion plans was highlighted. It was pointed out that it should not be the certification body’s job to assess plans, particularly where there is a business element, and this need should be raised to help justify additional support. The risk of organic farming being targeted for a reduction in support under pillar 2, due to the exemption from the greening measures planned for pillar 1, was also highlighted, although recent indications from Brussels are that there should not be any deduction.

Key conclusions

The discussion that followed the presentations brought out the following points:

  • Need to keep co-ordination between UK and Ireland organic sector representatives with regard to recommendations to Government and implementation of support schemes.
  • CAP reform has not been the radical departure predicted, it is basically ‘business-as-usual’ with a few tweaks.

Action points:

  • Recommendation for cross-fertilisation/co-ordination between UK and the IFOAM EU Group with regard to CAP reform measures.
  • The European Innovation Partnership offers good opportunities, this may not be taken up by Defra but will be good opportunities in other member states.

Individual speaker presentations and abstracts

Emma Hockridge (Soil Association) and Mark Measures(IOTA): Organic support in England 2014-2020

Overall, Defra is taking a more targeted approach to agri-environment payments, via its ‘New Environmental Land Management Scheme’ (NELMs). There would be no separate strands for organic production or uplands, but Defra has stated that ‘management options appropriate for these farming systems would be included in the scheme’. Work is being done to ensure that all organic farmers have access to these payments. Defra are still not planning to use income foregone calculations between equivalent organic and non-organic farms being as the basis for calculations of support payments. Using such calculations has been recommended by the EU in recognition of the environmental gains produced by organic farming. Partly as a result of this, the UK receives the lowest support payments of all member states. The environmental contribution of organic farming is still being questioned by some officials within Defra despite the large and growing body of evidence. Modulation, whereby money is transferred from Pillar one to Pillar two (from which all environmental payments including organic schemes are paid from) has recently been set at 12%. This will mean a lower amount of money for pillar II than originally planned by Defra. Organic farming support should be underpinned by other support for advice, market development etc. England still does not have a strategy to ensure this is developed.

Mark adds: Two years work spent developing innovative organic options and recent intense activity providing financial data to Defra have been distilled into a shortlist of only marginally more useful land management options specifically for organic farming and uncertain levels of financial support for organic conversion and maintenance.

Gillian Westbrook (IOFGA): Irish organic support 2014 to 2020

Ireland Pillar 2 RDP: The calculations to determine per hectare payments for organic farmers (2014-2020) remain in discussion as does the possible design of a much needed new agri-environment programme (AES) that compliments a system based approach. Ireland will not have an AES available for new entrants for 2014. The design of the previous AES offered limited options to organic producers and therefore a more encompassing scheme that supports functioning bio-diversity is required. The RDP SWOT and ex-ante evaluation discussions to date have indicated the need, under cross cutting objectives, to support organic production. Still required is to have organic farming prioritised and a sub-thematic programme created. This is on-going and due for completion in February 2014. The RDP budget is limited, and contains a risk of 15% fund transfer into Pillar 1, also a possible 8% coupled support, neither of which are favourable for organic producers.

Debs Roberts (SOPA): Organic farming support in Scotland 2014-2020

Scotland is in the fallow part of its normal rotation as farming businesses hunker down and sit tight until the CAP wave has washed over. While there is so much uncertainty about what the CAP will mean for individual businesses, farmers are being very conservative and not making any strategic changes to their business in case it is results in an unintended consequence. No-one will invest in rural development until the CAP budget and the application system is in place, so we do have concerns for the organic sector while we are in this limbo. Scotland has two Scottish Government CAP Consultations running until the end of February 2014. There are numerous worries under Direct Payments but the proposals for Rural Development are worthy of support. We are fortunate to have a close working relationship with Scottish government officials. And if the CAP was not bewildering enough, the waters are being further muddied with the Independence Referendum and the political future of Scotland is swinging in the balance. The politicisation is really not helpful and is causing even more uncertainty.

Keri Davies (Producer, OGoW): Organic farming support in Wales 2014-2020

The Welsh Government (WG) has issued a consultation on organic farming policy, which closed on 21st January. The consultation focuses on the following key aspects:

  • The structure of organic farming support within the framework of Pillar 1 and Pillar 2 support – this is likely to come under the Glastir umbrella of agri-environment schemes as Glastir Organic is likely to allow access to other elements such as Advanced and Efficiency (currently can only be accessed through Glastir Entry).
  • The basis for support payments – the balance of conversion payments compared to maintenance payments is possibly going to shift to increase maintenance payments.
  • Co-operative schemes – WG is proposing that a feasibility study is undertaken to consider opportunities for an organic co-operative scheme which could result in increased benefits.
  • Targeting and selection criteria – with a finite resources available, WG is consulting on how organic support can be targeted based on appropriate se-lection criteria including environmental and poten-tially economic sustainability.
  • Training, advice and business planning – it is pro-posed that organic support is dependent on the applicant having a comprehensive business and farm management plan.
  • Business modernisation through investment – the WG is proposing that loans and/or capital grants for business modernisation measures and infrastructure investments.
  • WG is beginning to consider how they can develop getting businesses within Wales to pay for environ-mental displacement to enhance environmental schemes and thus reduce our dependency on CAP.
  • Business modernisation through investment – WG is proposing that loans and/or capital grants for business modernisation measures and infrastructure investments.
  • WG is beginning to consider how they can develop getting businesses within Wales to pay for environ-mental displacement to enhance environmental schemes and thus reduce our dependency on CAP.

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