Common Agricultural Policy Reforms 2014-2020: Implementation Decisions in the UK

Common Agricultural Policy reforms for 2014-2020 are now being implemented across the European Union. There is a considerable amount of flexibility for each Member State to implement the reforms in the way that best suit their own farming systems. The UK Government secured agreement that, the devolved administrations should also have this flexibility. This means that a variety of implementation decisions have now been made or are being consulted upon across the UK.

This note has been expedited for Estimates Day (7 July 2014) and currently concentrates on English decisions but provides some comparisons with the devolved administrations. The paper will be further developed to provide a broader UK overview and further stakeholder comment on Library Research Paper 13/64 CAP implementation 2014-2020 in the UK and in Ireland (November 2013).

Key decisions include:

Modulation – transfer of budget between Pillar 1 (Direct Payments) and Pillar 2 (Rural Development). England 12% (to be raised to full 15% in 2018 and 2019 after review), Wales 15%, Scotland 9.5% and Northern Ireland 0% (due to a procedural issue with a possible review in 2017)

Greening: Administrations will follow the set greening criteria rather than introducing their own equivalent certification scheme but Scotland is seeking some equivalent measures. The criteria have to be met by farmers to secure 30% of their Direct Payment. These relate to crop diversification (3 crop rule), grassland and Ecological Focus Areas (EFAs)

Coupled payments: Only Scotland will take up the option of coupled payments i.e. payment linked to production for certain sectors. There will be coupled support for the beef and sheep sectors.

In England, although the National Farmers Union and environmental groups alike are critical of the overall EU reform package, they have conceded that the UK Government has done the "best of a bad job" in most areas of implementation.

However, there are outstanding concerns: the NFU remains concerned about the impact of the diversification requirements and landscape features which can count towards the greening criteria. Meanwhile, environmental groups such as the RSPB remain concerned that the greening criteria will deliver little environmental value. However, there is widespread support for the emerging shape of the New Environmental Land Management Scheme (NELMS) which will use Pillar 2 funds to reward farmers for farm management that promotes specific environmental objectives.