Download Policy scenarios - Northern Ireland Environment Link

Policy scenarios
(1) Are the policy scenarios outlined consistent with the objectives of the reform?
Could they be improved and how?
The policy scenarios presented appear to be consistent with the stated objectives of CAP
reform. We feel that the adjustment scenario, while providing for some increase of funds
to the second pillar for climate change, water, biodiversity and renewable energy actions,
would not go far enough towards addressing the EU objectives of smart, sustainable and
inclusive growth. We believe that the integration scenario would give a more appropriate
response to the type and scale of problems that agriculture will face between 2013 and
2020 while allowing farmers some scope for adjustment from the current system.
However, we see the re-focus scenario as appropriate for the longer term future of
farming beyond 2020.
(2) Are there other problems apart from those set in the problem definition section of
this document that should be analysed when considering the architecture of the
CAP in the post 2013 period? What causes them? What are their consequences?
Can you illustrate?
One problem is that farmers in some Member States have come to rely on subsidies and
to see them as theirs by right, and hence to resist having to do any additional work or to
modify their farming practices in response to changes in EU policy and priorities. This
attitude is supported by local politicians, and changing attitudes to the role of the EU
subsidies will take some time. The concept of delivering public goods is a relatively new
one and will require clarification and guidance to ensure that it is fully understood and its
ramifications accepted rather than feared. The positive aspects of reform need to be
strongly promoted to the farmers.
(3) Does the evolution of policy instruments presented in the policy scenarios seem
to you suitable for responding to the problems identified? Are there other options
for the evolution of policy instruments or the creation of new ones that you would
consider adequate to reach the stated objectives?
Some environmental or climate change related activities may not require CAP support
because other sources of support are available. For example, farmers may start renewable
energy generation with financial support from feed-in tariffs or renewable options
certificates paid by their national government. This will provide some diversification and
additional income without the need for additional CAP support. The concept of
developing a ‘invest to save’ fund to provide initial investment for long term payback
might be considered to encourage uptake of projects (such as renewable energy
installations) that take a year or more to pay back the initial investment.
Impacts
(4) What do you see as the most significant impacts of the reform scenarios and the
related options for policy instruments? Which actors would be particularly affected if
these were put in place?
The most important impact of the shift to environmental and climate change related
schemes would be to optimise the multifunctionality of land use to provide multiple
ecosystem services. Environmental and biodiversity protection and the resilience of rural
communities would be enhanced and all rural inhabitants and wider society would benefit
if these reforms were introduced. Land should be managed to deliver a wide range of
public goods, including food production and food security, and the support systems
should support this concept.
(5) To what extent will the strengthening of producer and inter-branch organizations
and better access to risk management tools help improve farmers’ income levels
and stability?
The only sustainable way for farmers to improve income levels is to add value to the
agricultural products that they produce by adopting some form of food processing such as
the manufacture of cheese, ice cream or other products further along the food chain. Over
the long term, they will always be in a vulnerable financial position if they simply
produce basic food commodities. CAP support can only help as long as funds are made
available and is therefore a temporary solution. Markets should be supported to evolve so
that in the longer term subsidies are not required to provide farm incomes. In addition
there is the provision of non-food products such as energy, waste disposal, tourism, etc.
which are ‘public goods’ and which the public must become more willing to pay for.
(6) What environmental and climate-change benefits would you expect from the
environment-targeted payments in the first and the second pillar of the CAP?
Environmental activities should include a range of actions which lie between ‘crosscompliance’ (essentially avoiding illegal action) and the higher levels of agrienvironment schemes where major positive effort and investment are required. These
will largely be based around what is farmed and how the land is managed; farmers will
not be willing to provide significant additional investment for relatively little payback.
There are a large range of activities which can fall in this area, including set aside, waste
management, reduced inputs of fertilisers and pesticides and careful timing of their
applications, wide unplanted areas adjoining hedges and streams, renewable energy and
management of land between crop seasons.
This support should include aspects of delivering public goods which may not be seen
traditionally as ‘environmental’, such as enhancing landscape for tourism or providing
recreational access.
Farmers should also be encouraged to follow agri-environment schemes under Pillar 2.
Schemes must be carefully designed to ensure that environmental improvements occur.
For example, schemes that currently include regular drainage of peatland areas should be
changed to prevent drainage so that the water table can be restored as part of a
programme to restore the peatlands for carbon storage.
(7) What opportunities and difficulties do you see arising from a significant increase
of the rural development budget and a reinforcement of strategic targeting?
Clearly there will be increased risks for farmers’ incomes during periods of price
volatility. However, farmers may realize that this can be at least partially offset by
guaranteed income support for agreed environmental actions. There is already opposition
in Northern Ireland to any additional funds being used in Pillars 2 or 3; indeed there are
arguments made for diverting most of these funds to Pillar 1. It is argued that the
environmental aspects of Pillar 1 should be funded from Pillar 2. We would reject this;
the work done under Pillar 2 should be of a much higher level than that under Pillar 1.
Pillar 1 should contain a basic support element, including cross-compliance conditions, to
ensure that all the work they do complies with legal requirements. It should be seen as a
payment for managing the land in the overall public good, and is a fee that the public is
willing to pay to ensure that this is delivered. The ‘additional’ payment should encourage
particular work which delivers specific public goods (see below; these must be clearly
defined and can cover all three ‘goals’ of the CAP) and should relate to income directly
foregone by the farmer because of these actions. These changes in management may
involve how land is managed and what outputs are produced. Pillar 2 should provide
benefits which require additional input, such as enhanced boundary treatments, tree
planting or conversion to organic production.
(8) What would be the most significant impacts of a "no policy" scenario on the
competitiveness of the agricultural sector, agricultural income, environment and
territorial balance as well as public health?
Experience in New Zealand would suggest that a “no policy” scenario would initially
lead to many farmers going out of business but would eventually lead to a competitive
agricultural sector. However, a reformed CAP is preferable because it can combine
agricultural reform with environmental and rural community benefits. There are also
dangers for the environment, health, animal welfare, etc. if farmers targeted income
generation from production alone with no strong incentives to deliver environmental,
climate change, land management and public good outcomes.
Monitoring and evaluation
(9) What difficulties would the options analysed be likely to encounter if they were
implemented, also with regard to control and compliance? What could be the
potential administrative costs and burdens?
There is much concern that there will be increased bureaucracy and monitoring with
these proposals. They must be designed and promoted in such a way that the bureaucracy
is decreased and it is easier and cheaper for farmers and for the government departments
charged with monitoring and reporting. There is a major opportunity to link all aspects of
regulation applying to farms through integration across all EU Directives and local
regulations, but this requires integration across Departments, particularly DoE and
DARD. There are major concerns in the farming community about the amount of
bureaucracy, reporting and monitoring which will be required; this concern must be
addressed by introducing a simplified, proportional system of reporting, monitoring and
regulation.
Administrative costs need not be any higher than current costs. The biggest problem
could be the availability of government officials with sufficient ability to design efficient
and effective agri-environment schemes and explain them clearly to farmers.
(10) What indicators would best express the progress towards achieving the objectives
of the reform?
Water quality indicators (both chemical and biological) for surface waters may give the
best evidence for progress. It is essential to incorporate the Water Framework Directive
and Biodiversity related Directives into the reformed CAP.
(11) Are there factors or elements of uncertainty that could significantly influence the
impact of the scenarios assessed? Which are they? What could be their influence?
The implications of climate change policy, the drive for greater regional self-sufficiency
in food production, consumer preferences, increasing prices of energy and fertilisers and
impacts of severe weather are all significant areas of uncertainty which will impact on
farming decisions.