BRUSSELS, BELGIUM — The European Parliament Agriculture & Rural Development Committee voted Jan. 23 on several measures to reform the Common Agricultural Policy (CAP). 
The committee said E.U. farm policy reform must distribute E.U. funding more fairly, make "greening" measures mandatory but flexible, better equip farmers to cope with market challenges and cut red tape, according to four legislative proposals the committee voted on.
“This is the first time that a reform of the CAP is subject to co-decision, and this week's vote is an important step in the process,” said E.U. Agriculture & Rural Development Commissioner Dacian Ciolo?.
The CAP, one of the E.U.'s oldest, must be properly funded to continue to ensure secure supply of high-quality food to E.U. citizens and enable farmers to protect the environment better, said parliament members.
"This is the moment of truth. The Agriculture Committee has said how the new CAP should look. It should be more efficient, greener and able to respond to the enormous challenges ahead of us. Such ambitious goals entail higher costs. So any further cuts to the CAP budget are simply inacceptable," said committee chair Paolo De Castro.
To ensure that direct payments go only to active farmers, the committee included a list of entities, such as airports and sports clubs, which should be automatically excluded from E.U. funding unless they prove that farming contributes a substantial share of their income. 
Parliament members also said that differences among E.U. member states in the levels of E.U. funding that farmers receive should be reduced slightly faster than the Commission proposed. Under the new rules, no member state's farmers should receive less than 65% of the E.U. average. 
The rate of payments to farmers within each member state could also be made equal by 2019, but to avoid sudden sharp falls in support that could jeopardize the viability of many farms, member states should still be allowed to deviate from the average by up to 20%. 
Parliament members endorsed Commission proposals to cap direct payments to any one farm at €300,000, and reduce payments to those receiving between €250,000 and €300,000 by 70%, and payments to those receiving between €200,000 and €250,000 by 40%. Payments to farms receiving between €150,000 and €200,000 would be cut by 20%. 
Other amendments, seeking to reduce payments to bigger farms even further or on the contrary calling for the capping to be completely rejected, failed to win the support of a majority in committee. Parliament members nonetheless adapted the rules proposed by the Commission so as to exclude cooperatives and other groups of farmers who distribute payments received to their members and ensure that capped money remains in the region where it was capped and is used for rural development programs.
New environment protection rules, which will make 30% of national budgets for direct payments conditional upon compliance with mandatory greening measures, must be made more flexible, said parliament members. The three key measures — crop diversification, maintaining permanent pasture and permanent grassland and creating "ecologically  focused areas" — would remain but with certain exceptions, e.g. to reflect the size of the farm. Farms with under 10 hectares of arable land should be exempt and the rules should be relaxed for holdings of 10 to 30 hectares, said parliament members.
"We have managed to bring greening into the first pillar of the CAP, making it possible for every farmer in the E.U., not just those in countries that can afford to fund it under rural development programs. This greening is clearly subject to E.U. rules, and now needs to be paid for by real E.U. money for a public good,” Capoulas Santos said.
Risk management tools should be funded from the budget for rural development programs, not from the direct payments budget as is the case today, said parliament members, agreeing with the Commission's proposal. The income stabilization tool should take the form of financial contributions to mutual funds or to buy insurance against the risk of severe drop in income.
To better equip farmers to cope with market volatility and manage crises but also to strengthen their price bargaining position, producer organizations should be given significantly wider powers and new tools, said parliament members. Farmers' organizations should be allowed to use crisis-prevention and crisis-management instruments including, as a last resort, market withdrawal. Furthermore, they should have the right to negotiate, on behalf of their members, input and delivery contracts without falling foul of competition law. 
To make farmers' lives easier while keeping a close eye on compliance with common rules and how E.U. funds are spent, the committee approved several measures designed to remove unnecessary bureaucracy for farmers and ensure that penalties for breaching rules are proportionate. 
"This is the leitmotif of the new system of checks and penalties. But the principle of proportionality should apply not only to the infringements but also to delays and the degree of responsibility of farmers", said Giovanni La Via, rapporteur for the financing, management and monitoring regulation. 
"We also need to cut the time farmers must spend with paperwork. To this end, member states should have the option to create an aid application that would remain valid for several years so that farmers do not have to register their claim each year but only when there are changes. Furthermore, if money earmarked for rural development is not fully spent, the remainder should stay in the national budget rather than being returned to Brussels.”
Rather than imposing sanctions immediately, member states could set up an early warning system to deal with cases in which non-compliance does not constitute a direct risk to public or animal health. An alert would be sent to a beneficiary who breaches a rule for the first time and inform him of the need to remedy it. This alert should be followed by checks to ensure that the breach has been put right. If this is done, payments should not be reduced, said parliament members.
Finally, the committee rejected a Commission proposal to make public the names and municipalities of those in receipt of direct payments or money from rural development programs. In the past, many parliament members have expressed concern that such extensive transparency rules would breach beneficiaries' privacy rights and could be rejected by the European Court of Justice.
The Agriculture Committee's negotiating position must win the blessing of Parliament as a whole before parliament members can start negotiations with member states on the final shape of future E.U. farm policy. The plenary vote is provisionally scheduled for March session in Strasbourg, pending final figures for the E.U.'s Multiannual Financial Framework (MFF) for 2014 to 2020. The next summit of E.U. heads of states and governments to deal with the future MFF is scheduled for Feb. 7-8.