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Commissioner Cioloş on the future EU budget 2014-2020 and agriculture

"With the presentation of the European Commission proposals for the Multi-Annual Financial Framework for 2014-2020, we have taken an important step for the future of the CAP. In the current context of economic and budgetary pressure, the European Commission is proposing to maintain CAP spending at 2013 levels, namely €371.7 billion, to which we add additional room for manoeuvre of €15.2bn, in total €386,9bn available for agriculture. With this global envelope available for European agriculture we can preserve the EU’s capacity to react with force and with clear will – to permit this strategic sector to respond to the major challenges of tomorrow."

Above all, I am thinking of food security, the preservation of our natural resources and the balanced development of rural areas. Today, the Commission has also set out guidelines for the CAP reform on several key points.

The system of Direct Payments will stay at the heart of our action to support agricultural income. The aids will be allocated in a more equitable way and a significant share will be dedicated to reinforcing the (eco)competitively and  the sustainability of the agricultural sector. At the same time, we will keep solid Rural Development programmes, with a consistent level of support, at the centre of the future CAP – in contrast to some of the rumours that have been circulating in recent weeks. I  would like to underline that all of these funds will be exclusively available to agriculture because the CAP will be recentred around fundamental objectives. Several important elements will be redefined outside of the CAP budget, notably certain sanitary and veterinary measures (2.2bn). As for the Aid for the Needy programme (2,5bn) it will be maintained in the long term through the European Social Fund, intervention stocks coming in addition to the budget available under this fund. In total, these reallocations to other heading of the EU budget will provide an additional flexibility of €4.7bn that do not exist in the current envelope.
In addition to this, there will be several new elements for a total of €10.5bn:
Agricultural production must make urgent progress if we want to address the challenge of global food security. This increase will come through more innovation and a greater diffusion of agronomic knowledge. The Commission is proposing a substantial additional envelope of €4.5bn for agricultural research. This spending will enable us – through the new European partnership for research and innovation – to form the basis for a true strategy for the sustainable increase in agricultural production and the adaptation of production to consumers’ expectations.

In addition, farmers are faced with new crises not directly linked to the usual factors of the sector, but to larger integration onto world markets, financial markets and commodity markets. On top of these new opportunities, this opening has exposed new challenges, and notably that of price volatility. To address this, the Commission foresees a budget of €2.5bn.

Finally, the Commission is looking to set up an emergency reserve of €500million a year to address unforeseen problems linked to climate change, to market crises and other threats to our farming and food production capacity. This is worth €3.5bn over the 7 year period.
The next step will now be the presentation next autumn of the legislative proposals for the reform of the CAP. The draft MFF confirms the Commission's commitment to present an ambitious reform, which will allow European agriculture to fulfil its potential in a sustainable manner, securing the supply of safe and sufficient food, and assuring a fair standard of living for farmers. The greening of the direct payments, a more equitable distribution of payments and a ceiling on payments will be important elements in this reform. This text already sets guidance on the issue of greening that will represent 30% of direct payments. It also indicates the intention of the Commission to limit CAP support only to active farmers, to move towards greater equity in the distribution of payments and to introduce a capping on the level of support. Finally, it provides for the establishment of a simplified allocation mechanism for small farms, a review of crisis management tools and a rural development policy focused on results."

Last update: 14/11/2014 |  Top