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Common Agricultural Policy (CAP)

Common Agricultural Policy reform gets final approval from MEPs

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On Tuesday (23 November), Parliament gave the green light to the new EU Farm Policy. This reformed version aims to be greener, fairer, more flexible and transparent, AGRI, Plenary session.

During the negotiations on the legislative reform package, MEPs insisted that strengthening biodiversity and adhering to the EU’s environmental and climate laws and commitments will be key to the implementation of the reformed Common Agricultural Policy (CAP), taking effect in 2023. While the Commission will assess whether national CAP strategic plans are in line with these commitments, farmers will have to comply with climate- and environmentally-friendly practices. Member states will be obliged to ensure that at least 35% of the rural development budget and at least 25% of direct payments will be dedicated to environmental and climate measures.

More support for small farms and young farmers

MEPs ensured that a minimum of 10% of direct payments will be used to support small and medium-sized farms and at least 3% of the CAP budget will go to young farmers. They also insisted that a crisis reserve with an annual budget of €450 million (in current prices) will be permanently ready to help farmers with price or market instability.

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More transparency and better compliance with labour rules

As a result of Parliament’s pressure, EU labour rules in agricultural sectors will be better monitored and infringements penalised thanks to the cooperation between national labour inspectors and CAP paying agencies.

Information about final beneficiaries of EU support will be more transparent thanks to an EU data mining tool, which member states will get access to and which helps to identify the risk of fraud occurring by cross-checking information in public databases.

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The “Strategic plans regulation” was adopted with 452 votes in favour, 178 against and 57 abstentions, the “Horizontal regulation” with 485 votes in favour, 142 against and 61 abstentions and the “Common market organisation regulation” with 487 in favour, 130 against and 71 abstentions.

Rapporteur for the 'Strategic plans regulation' Peter Jahr (EPP, DE) said: “By approving the CAP reform, we guarantee planning security not only for member states, but above all for our European farmers. We have ensured that this CAP is more sustainable, transparent and predictable. The new delivery model will reduce the bureaucratic burden of agricultural policy on farmers. Our vote today has shown that we want to protect and promote family farms, the people who maintain and preserve our cultural landscape.”

Rapporteur for the 'Horizontal regulation' Ulrike Müller (RE, DE) said: “Today marks a historic day for the new CAP, a day when we advance towards a more environmentally ambitious, socially aware and performance-oriented agricultural policy. The new delivery model will ensure that the focus of the CAP will be more on achieving its targets and less on simply complying with the rules. We also made sure CAP payments are more transparent and that the EU’s financial interests are better protected. This CAP will really be a success.”

Rapporteur for the 'Common market organization regulation' Eric Andrieu (S&D, FR) said: “For the first time in more than 30 years, thanks to the common market organisation part of the CAP reform, the reforms approved today will mean more market regulation than deregulation. We can be proud of how far we have come, because the progress made is important for farmers, for the sector, and for consumers. The common market organisation is certainly a first step in the right direction.”

Next steps

Current CAP rules were extended after 31 December 2020 and replaced by transitional rules until the end of 2022. Once approved by the Council, the new rules will be applicable from 1 January 2023.

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Agriculture

EU agriculture statistics: Subsidies, jobs, production

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Discover facts and figures about farming in the EU, including funding by country, employment and production, Society.

Agriculture is an important industry for all EU countries and they all receive EU funds through the Common Agricultural Policy (CAP). These funds support farmers directly through the European Agricultural Guarantee Fund and rural areas, climate action and the management of natural resources through the European Agricultural Fund for Rural Development.

Find out how the Common Agricultural Policy supports farmers.

EU agricultural subsidies by country

In 2019, €38.2 billion was spent on direct payments to farmers and €13.8bn on rural development. A further €2.4bn supported the market for agricultural products.

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The rules governing how Common Agricultural Policy funds are spent is determined by the EU’s long-term budget. The current rules run until December 2022, after which the most recent reform of the Common Agricultural Policy will come into effect and run until 2027.

Infographic with map showing the amount of Common Agricultural Policy subsidies per EU country in 2019. Key data can be found under the heading EU agricultural subsidies by country.
The division of the Common Agricultural Policy funds between EU countries  

EU agriculture employment statistics

The agriculture industry supported 9,476,600 jobs in 2019 and 3,769,850 jobs in food production (in 2018) and accounted for 1.3% of the EU's gross domestic product in 2020.

Romania had the most people employed in agriculture in 2019, while Denmark had the most people employed in food production in 2018.

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For every euro spent, the farm sector creates an additional €0.76 for the EU economy. The gross value added from farming - the difference between the value of everything that the EU’s primary agricultural sector produced and the cost of the services and goods used in the production process - was €178.4 billion in 2020.

Infographic showing the employment in agriculture (in 2019) and food production (in 2018) per EU country. Key data can be found under the heading EU agriculture employment statistics.
The food and agriculture sectors in the EU  

Agricultural production in Europe

EU agriculture produces a rich variety of food products, from cereals to milk. The EU has legislated to ensure that the food produced and sold in the EU is safe to eat. The EU’s farm to fork strategy, announced in 2020, aims to ensure that food is also produced more sustainably. MEPs want to cut pesticide use to better protect pollinators and biodiversity, end the use of cages in animal farming and increase land use for organic farming by 2030.

Infographic showing how many tonnes of different foods were produced in the EU in 2019.
Food production in the EU  

Common Agricultural Policy 

Data sources 

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Agriculture

European Parliament set to vote on huge farm subsidies' deal

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Members of the European Parliament attend a debate on the Common Agricultural Policy (CAP) during a plenary session at the European Parliament in Strasbourg, France, November 23, 2021. REUTERS/Christian Hartmann/Pool
European Commissioner for Agriculture Janusz Wojciechowski speaks during a debate on the Common Agricultural Policy (CAP) during a plenary session at the European Parliament in Strasbourg, France, November 23, 2021. REUTERS/Christian Hartmann/Pool

Lawmakers who helped broker a deal with governments on reforms to the European Union's huge farming subsidy programme urged the European Parliament to give it the final green light on Tuesday (23 November), writes Ingrid Melander, Reuters.

The deal reached in June ended an almost three-year struggle over the future of the EU's Common Agricultural Policy, and accounts for about one third of the bloc's 2021-2027 budget -- spending about €387 billion ($436bn) on farmers and support for rural development.

The new CAP rules, which would apply from 2023, aim to shift money from intensive farming practices to protecting nature, and reduce the 10% of EU greenhouse gases emitted by agriculture.

The reforms have a good chance of being approved by the European Parliament later on Tuesday. But environmental groups and some lawmakers say they do not align farming with EU goals to fight climate change and that many of the measures planned to encourage farmers to shift to environmentally friendly methods are weak or voluntary.

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"I'm urging you, please, in the interest of the European farmers, in the interest of the climate, to vote in favour," said Peter Jahr, a German member of the European Parliament.

Addressing criticism of the reforms, he said compromises were needed.

The executive European Commission's agriculture chief, Janusz Wojciechowski, said the reforms would "foster a sustainable and competitive agricultural sector that can support the livelihood of farmers and provide healthy and sustainable food for society while delivering significantly more in terms of environment and climate."

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The reforms would require 20% of payments to farmers from 2023-2024 being spent on "eco-schemes", rising to 25% of payments in 2025-2027. At least 10% of CAP funds would go to smaller farms and all farmers' payments would be tied to complying with environmental rules.

The deal also creates a €450 million crisis fund in case agricultural markets are disrupted by an emergency such as a pandemic.

($1 = €0.8880)

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Agriculture

Common Agricultural Policy: How does the EU support farmers?

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From supporting farmers to protecting the environment, the EU's farm policy covers a range of different goals. Learn how EU agriculture is funded, its history and its future, Society.

What is the Common Agricultural Policy?

The EU supports farming through its Common Agricultural Policy (CAP). Set up in 1962, it has undergone a number of reforms to make agriculture fairer for farmers and more sustainable.

There are about 10 million farms in the EU and the farming and food sectors together provide nearly 40 million jobs in the EU.

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How is the Common Agricultural Policy funded?

The Common Agricultural Policy is funded through the EU budget. Under the EU's budget for 2021-2027, €386.6 billion has been set aside for farming. It is divided into two parts:

  • €291.1bn for the European Agricultural Guarantee Fund, which provides income support for farmers.
  • €95.5bn for the European Agricultural Fund for Rural Development, which includes funding for rural areas, climate action and the management of natural resources.

How does EU agriculture look today? 

Farmers and the agriculture sector were affected by COVID-19 and the EU introduced specific measures to support the industry and incomes. Current rules on how CAP funds should be spent run until 2023 due to delays in budget negotiations. This required a transitional agreement to protect farmers’ incomes and ensure food security.

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Will the reform mean a more environmentally-friendly Common Agricultural Policy?

EU agriculture accounts for about 10% of greenhouse gas emissions. The reform should lead to a more environmentally friendly, fairer and transparent EU farm policy, MEPs said, after a deal was reached with the Council. Parliament wants to link CAP to the Paris agreement on climate change, while increasing support to young farmers and small and medium-sized farms. Parliament will vote on the final deal in 2021 and it will come into effect in 2023.

Agriculture policy is linked to the European Green Deal and the Farm to Fork strategy from the European Commission, which aims to protect the environment and ensure healthy food for everyone, whilst ensuring farmers’ livelihoods.

More on agriculture

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