Commission working document - DG VI

State of application of regulation (EEC) no. 2078/92: Evaluation of Agri-environment Programmes

Conclusions

Main effects

The application of agri-environment contracts delivering environmental services over 20% of European farmland, marks a very significant step towards sustainability. The target set in the 5th Environmental Action Programme of 15% coverage by 2000 has thus already been exceeded. The requirement on Member States to apply the regulation throughout their territories according to their needs has stimulated a very rapid expansion of initiatives and measures, which otherwise may have taken many years to be launched and developed.

The evidence presented from programmes is on the whole positive and shows that substantial environmental benefits accrue from agri-environment programmes. The following are particularly noted:

• many of the broad programmes to limit input use show large reductions in the use of N-fertiliser and better application techniques, resulting in a lower N-balance;
• strong evidence of positive activities for nature protection is available. This results from the symbiotic link between European biodiversity and farming on which it depends;
• programmes to maintain and improve landscape features have been shown to have positive results to maintain elements no longer relevant to farm production;
• an increase in employment is recorded in some cases, for example where a low-labour intensive activity is replaced by labour intensive environmental management;
• contributions to income have been substantial in the case of farmers in marginal areas where continued farming is necessary to provide the environmental benefits. However, the income effects are relatively insignificant in more profitable and intensive areas;
• application of programmes has had some effects on changing attitudes, both those of farmers and, in increasing general awareness, public at large. Farming is increasingly seen not as an activity inconsistent with environmental care, only to be reduced in scope, but as the essential part of the solution;
• evaluation reports show that programmes provide value in terms of environmental benefits. The cost to the Community budget is relatively modest: 4% of EAGGF guarantee section. This points to a high level of value for money;
• concerning the agricultural impacts of the measures, evidence from more intensive areas shows substantial decreases in yield, while in marginal areas, the maintenance of production has been a significant agricultural consequence of the environmental measures. In many cases, however, the agricultural impacts have not been adequately measured;
• finally, some success must be recorded in the vast majority of Member States for having established an evaluation management culture, whereby programmes are monitored, assessed and adjusted to close the gap between objectives and outcomes.

Implementation

Minimum standards of environmental care must be assured through regulatory standards and application of codes of good practice. Agri-environment has a role to play to influence farmer decisions to provide services beyond the application of good practice, but it is not an appropriate instrument with which to assure observance of compulsory standards.

The most relevant indicator of application is the area to which measures apply. Implementation so far has been diverse. Some Member States applying the programmes fully and others showing a very weak application. A particular emphasis is placed on the programmes in the new Member States. Three groups of Member States can be identified — these with high rates of take-up covering 40-80% of UAA; an average group, around 20% UAA (the average for the EU), and a group of very low take-up of less than 10%. The lack of correlation between payments per ha and take-up suggests highly diverse types of programme design.

Implementation data also show that there is no model programme: each Member State and frequently each region has chosen their own pattern of implementation. Even in Member States where agri-environmental policy has been in force longer than Regulation 2078/92 itself, some administrators and farmers are still operating at an experimental level. It is important, at this stage, to give much more emphasis to evaluation and monitoring on the one hand and to information, demonstration and training on the other.

The diversity of application and number of measure failures, is indicative of experimental and innovative programmes. However, enough experience now exists in each Member State and between the Member states to develop a second phase of agri-environment programming. This should lead to better, more effective programmes which deliver benefits in more transparent ways.

The Commission has a potential role to collate and disseminate implementation data on a systematic basis. In the Report on Application, the possibility of establishing an observatory is raised. This could equally be a network of existing institutes, as suggested by some commentators, charged with the task of managing programme and other data and making it available.

Impact of measures

Concerning the detailed impact of measures, the following observations can be made:

• results concerning input reduction need continued close analysis, in particular to sort out what changes are due to agri-environment programmes and what are due to other factors, such as advances in technology and market messages;
• positive effects from IP on biodiversity are recorded;
• a notable lack of impact on intensive areas, where premia rates for substantial yield drops would be too high for some programme budgets and tend to exceed the maximum cofinancible amounts. In problem areas, authorities should look carefully at the basic levels to see if the minimum standards of environmental care should be improved by means of higher regulatory standards;
• organic farming has had a positive take up in some Member States, but a familiar problem reported is the lack of market outlets. More effort is needed on processing and marketing and development of domestic demand in some regions. Environmental impacts of programmes should be monitored;
• the measure for the application of extensification of livestock has been unsatisfactory. In general this measure should be accompanied by measures for environmental land management (currently forbidden under the regulation). Measures for sustainable farming management are likely to have a more positive acceptance by farmers;
• measures need to be appropriate to the areas and landscape types to which they apply. In general, no measure should be available on land, without an assessment of its applicability. Many diverse measures, beneficial in one place can have damaging consequences in other areas;
• monitoring of biodiversity in nature protection areas shows that this can be a very difficult and costly activity. Good baseline data is needed and patience to continue measures for a substantial period to determine trends;
• while 20 years is too long for a measure in general, there are many instances where more than 5 years is needed to deliver meaningful results. Beyond the 5-year minimum, a more flexible time period should be applied according to the conditions applicable;
• maintenance of abandoned farmland is a second best environmental option. Policy should be directed towards prevention of abandonment. However, in cases where land is abandoned, efforts to maintain the basic environmental condition may be necessary;
• landscape features, once maintained by farming, now obsolete, are important to keep up. Historical and archaeological remains which impinge on farm activities should also be eligible as the subject of appropriate agri-environment measures, provided their maintenance causes a cost or loss of income to the farmer;
• facilitating public assess is an essential rural development measure in many Member States and should be continued. As an adjunct to environmental measures, however, public access impacts are mixed. Evaluation points to the need for a more coherent strategy. In addition the justification of premia and covering income losses and costs is inappropriate. Thus, access provisions should be provided for outside the relatively narrow scope of agri-environment measures;
• agri-environment policy should make more clear specific support for the maintenance of existing landscape systems including low intensity and high nature value sites, where some of the greatest achievements of programmes are recorded. The absence of change in the management of some sites must be rejected as a ground for criticism where the measures are scientifically and economically justified. It would be inefficient to require that cultural landscapes deteriorate before becoming eligible for protection.

Programme design

Agri-environment policy is needed because of a market failure to take account of the value of the environmental consequences of agriculture. In practice, there is no possibility of providing an exact and universally applicable definition of the environmental benefits (or harms) so policy must provide the right instruments in line with society’s willingness to pay for these benefits.

There is a broad spectrum of objectives that agri-environmental policies can pursue since the relationships between agricultural practices and environment are exceptionally diverse and most often location-specific. Therefore it is important that the objectives of all agri-environmental programs are clearly specified. This would increase transparency and facilitate monitoring and evaluation.

The decentralised approach is the only feasible way of designing programmes. However, Community policy needs to be applied, meaning that:

• the integrity of the CMOs must be assured and distortions to the single market prevented;
• common policy must apply with regard to the CAP, including the integration of environmental concerns.

The following points may also be concluded:

• diversity of measures and programmes to correspond to regional needs and potential is an essential feature of agri-environment programmes; no blueprint programme should be provided from the Commission (nor from anywhere else);
• a holistic landscape approach to take all aspects into account, has much to recommend it;
• a mix of types of measures, incorporating focused targeted measures to address specific issues in designated areas, and wide and general measures with relatively light obligations, provides the best results;
• the whole farm approach is attractive; but there are some disadvantages in certain circumstances;
• administration must take into account available resources and existence of trained personnel. Programmes must be designed with the feasibility of application in mind. Where appropriate, private sector advisors should be used, subject to controls to assure quality of advice;
• extension services and training are key, provided the provision of information to farmers is of an adequate quality;
• while respecting the minimum period for agreements (at least 5-years), payment levels and conditions of measures should be subject to periodic review, including for running agreements. Programmes should indicate the terms and frequency for reviews;
• consultation with authorities responsible for the objectives of programmes is essential. Consultation with NGOs should also be encouraged, particularly where they have relevant expertise in the regions concerned. However, responsibility for programmes must remain with the sponsoring authority;
• targeting is important; but need not be on a small area; targeting may be on a system or aspect or landscape type. The blanket availability for all measures irrespective of local conditions should not be undertaken;
• the considerable difficulties posed by some traditional land tenure problems should be resolved by Member States, if necessary employing imaginative solutions. However, the basic 5-year agreement and need to see results on land should not be weakened;
• the 5 year minimum period should continue to apply. However, where a longer period is objectively necessary, then this longer period should be applied. This flexible rule should also be used in the case of set-aside;
• non-productive capital works should be eligible for payment where they are necessary for the achievement of an environmental measure. However, capital items which also fulfil a significant agricultural purpose should continue to be classed as agricultural investments;
• the system of maximum cofinancible amounts has saved money in so far as measures involving high costs have been capped. However, the savings have in some cases been as a result of a low take-up by farmers, with less consequent benefit;
• agri-environment policy is not the only answer to questions of environmental interaction with agriculture. Member States should consider the full range of alternative instruments, whether national or part of the CAP. In particular, instruments which improve resource allocation and cost effectiveness should be applied;
• national policies should avoid contradictions and overlaps with Community financed programmes. Parallel activities should be transparent and fully disclosed to assure efficiencies.

Follow up, Monitoring, evaluation and programme amendment

Given that most agri-environment programmes are complex, a continual process of review and adjustment is a positive aspect of implementation. The Commission and Member States must ensure as smooth a procedure as possible to enable changes to be made as the need arises. Adjustments arise from a careful follow up of programmes. The main elements are:

• objective setting is essential. Precise and measurable objectives are needed. There is considerable room for improvement in many programmes on this point;
• scientific monitoring needs to follow meaningful indicators on programme level;
• in general, the evaluation results supplied are adequate and reflect well on the Commission’s strategy contained in Article 16 of the Implementing regualtion to responsibilize the Member States in this regard. Good quality monitoring and evaluation is evidence of a management culture prepared to accept programme development. In many regions, however, and some Member States less efforts appear to have been made. In other Member States, evaluation is still at an early stage and no results are foreseen until 1999. However, in the case of 1 Member State and some regions, efforts have not been sufficient;
• assuring the controllability of undertakings is essential. As a principle, every undertaking on which a payment is justified should be capable of adequate control;
• selection of indicators and their use merit further discussion;
• further reflection also needed on content and presentation of monitoring and evaluation reports;
• implementation of Regulation 2078/92 has reached in most cases a high degree of complexity that makes administration a difficult task. Successful policies are those which achieve objectives at least overall cost. Therefore the administrative costs should be taken into account in Member States’ evaluations to assess cost-effectiveness;
• the amount of research and follow up to agri-environment is immense. A satisfactory means to deal with the information and apply it in programme management is required.

Landscape approach

Finally, programmes which address the agri-environment challenge through the perspective of landscape systems can be recommended, although the administrative costs are likely to be high. A carefully designed holistic programme, which takes into account the full range of issues and processes in a landscape system may lead to measures of special merit from the environmental viewpoint. The essence of the landscape approach is that clear observation of the range of needs and potential can lead logically to appropriate measures and targets. In particular, a landscape approach should produce the following advantages:

• coherence with other policies - to prevent application of competing and mutually inconsistent measures;
• use of local traditions, livestock breeds and crop varieties;
• incorporation of the needs of small farm woodlands, coppices and pasture systems to be covered by agri-environment;
• appropriate role for regulatory standards;
• clear expression of environmental aims and priorities, including cases where set aside or discontinuation of farming is a preferred option;
• measurable targets.

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