CAP reform is concluded with political agreement for MFF related issues

The final political agreement on the CAP reform package, as outlined in the Council press release, hinged on finding common ground for three outstanding issues; the issue of degressivity, transfers between funds and higher EU cofinancing for rural development in certain areas. Additional elements which were finalised in the political agreement were the national ceilings for direct payments and rural development. Although not areas of contention between the Council and EP, as a matter of principle all elements under the MFF which were approved in February’s European Council Summit were revisited, meaning that confirmation of the budgets for Member States for direct payments and rural development were confirmed.

No changes have been made to the provisions for transfers between funds. Member States can transfer up to 15 per cent of their national envelopes for direct payments to Pillar 2 with no national co-financing necessary. Moreover, Members States can transfer up to 15 per cent from Pillar 2 to Pillar 1 with provisions included for up to 25 per cent (ie an additional 10 per cent) transfer for those Member States receiving less than 90 per cent of the EU average for their direct payments.

The Council accepted the EP request for higher EU cofinancing rates for rural development in certain parts of the EU, to come in line with the cofinancing rates for Structural Funds, but on a voluntary basis. This has been extended from 75 per cent to 85 per cent for rural development projects in less developed areas, the outermost regions, and the Aegean Islands.

On the issue of degressivity, the EP had called for the introduction of a 15 per cent reduction on all direct payments exceeding €150,000. The Council met them part way, moving away from their original position that capping large payments should be voluntary to agreeing to a mandatory five per cent reduction for payments exceeding €150,000, with an exemption for those Member States using more than five per cent of their national ceiling for the redistributive payment on the first hectares of land. It was agreed that Member States could increase the rate of degressivity up to 100 per cent on a voluntary basis. Salary costs for farm workers can also be excluded before the reduction is applied if Member States wish to do so. Of note, degressivity applies only to the 70 per cent basic payment and single area payment, meaning that the 30 per cent greening will be exempt. Where funds have been saved as a result of degressivity, the provisions state that such funds must stay in the Member State or region where the saving was made and transferred to Pillar 2, with no cofinancing needed.

Consolidated texts for each of the four regulations are now available on the council website as follows:

With a political agreement reached on the remaining CAP issues, the legislative texts are expected to be formally adopted before the end of the year. The texts first need to be approved at Plenary (18-21 November). If passed, it is anticipated that they will go to the December’s Council for the adoption of the agreement in its first reading. Implementing acts and delegated acts could then be published by the Commission early in 2014, with the implementing acts then subject to co-decision between the EP and Council.

1 comment posted

  • Apostille Stamps July 31st, 2014

    It would ne for each member state to decide on direct payments.

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PUBLICATION DATE

18 Oct 2013

AUTHOR

IEEP