Earlier this week, the Government held the first in a series of CAP 2020 consultation meetings. As Amy Forde reports, the focus was very much on the need to protect and even grow the CAP budget to meet income challenges on farms.
At this stage in the consultation process, farmers are right to put pressure on the Government and the European Commission to protect CAP spending. Step one has to be securing adequate funding – there will be plenty of opportunities in the months ahead to debate how this funding should be allocated.
There is no doubt that against a backdrop of budgetary pressures created by Brexit, calls from farmers for the CAP budget to be increased will be met with cynicism in some quarters – at member state and EU level.
Opponents will be quick to point out the fact that the CAP budget already accounts for 38% of the total EU budget, despite contributing just 1.5-3% to GDP, and that it should be reviewed with the aim of diverting funding to tackling new challenges, such as defence and migration.
It is easy to see how such an argument, supported by carefully selected figures, could quickly establish the narrative around CAP and undermine what it is delivering for EU citizens.
In many ways, the agricultural sector has been guilty of giving such vested interest groups free reign in influencing the consumer perception of CAP. For farmers, the strategy around the CAP budget can no longer be to keep the head down and hope the money continues to flow. It is time for the industry to get much more active in defending what CAP has delivered and continues to deliver for EU citizens, and why farmers have a legitimate expectation that funding should be increased.
Central to such a strategy is being able to demonstrate value for money: that investing in CAP delivers for EU citizens.
A recent opinion report produced by the European Parliament’s Committee on Agriculture and Rural Development for the Committee on Budgets highlighted that CAP costs each EU citizen just €0.32 per day – less than a cup of coffee per week. To merely put this figure in context, unemployment benefits across member states typically cost each EU citizen an average of €1.08 per day.
So, is CAP value for money? Interestingly, if we do the same exercise with the US Farm Bill, the average contribution made by US citizens is the equivalent of €0.68 per day. While the distribution of funding differs in the US, with a significant portion channelled through the food stamps programme, ultimately the aims of both the Farm Bill and CAP are closely aligned: to ensure that the demand for basic commodities from citizens is satisfied at all times and at reasonable prices.
There is no doubt that both polices have delivered on this front when we consider that the average US and EU consumer has one of the lowest spends on food as a percentage of household income. In the defence of CAP, the fact that many EU consumers are now spending less than 10% of their household income on food should not be underplayed.
A strong defence of CAP can also be presented in relation to the debate on the share of the EU budget relative to GDP. In making the argument, most ignore the fact that 30 years ago, CAP accounted for 75% of the total EU budget. Meanwhile, at a basic level, the GDP figure does not take into account the value that is added further up the supply chain, nor the fact that agriculture stimulates other sectors of the economy.
It also ignores the fact that agriculture is the principal source of income for over 20% of the EU population, predominately located in rural areas.
CAP sceptics should also be forced to consider how else we estimate the worth of the agricultural sector to EU citizens. Despite costing citizens 50% less than the US Farm Bill, the two-pillar structure of CAP delivers wide-ranging environmental and food safety benefits. Unlike their US counterparts, EU citizens do not have to contend with large-scale industrial farming units, nor the food safety concerns associated with GM technologies or growth hormones. Instead, we see CAP moving to support more and more public objectives around environmental sustainability and food safety.
Perhaps CAP is seen as a victim of its own success. It has long since delivered on the reason for its establishment, to such an extent that food security is now taken for granted. More recently, it has enabled the EU to deliver enhanced welfare and environmental standards at half the cost per person than in the US, where hormones are in everyday use.
For the price of a weekly cup of coffee, the EU has the global standard of food production, backboned by family farms and a reasonably vibrant rural economy. That has to be value for money in any economic measure.
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