Created in 1962, the common agricultural policy (CAP) is one of the oldest polices of the European Union (EU). Major reforms shaped the CAP in 1992, 2003 and 2013, adapting the policy to a changing world.
The common agricultural policy has its roots in 1950s Western Europe, whose societies had been damaged by the second world war, and where agriculture had been crippled and food supplies could not be guaranteed. Today, the main objectives of the CAP are to provide a stable, sustainably produced supply of safe food at affordable prices for Europeans, while also ensuring a decent standard of living for farmers and agricultural workers.
Six countries organise common markets (1960s)
In June 1960, the European Commission presented legal proposals on how to realise a common agricultural policy between the six founding countries of the EU thanks to the free movement of agricultural products, removal of trade barriers and a common market organisation by product and price. European Commissioner Sicco Mansholt, a Dutch farmer and politician, was the main architect of Europe's farm policy.
Birth of the common agricultural policy (1962)
In 1962, the CAP is born! The Council of the European Union gave the green light to setting up the common market organisations for six agricultural products (cereals, pig meat, eggs, poultry meat, fruit and vegetables and wine), competition rules were introduced, a schedule to assist intra-community trade for dairy products, beef and veal was introduced, and the European Agricultural Guidance and Guarantee Fund (EAGGF) was established.
European farms modernised (1970s)
In the 1970s, the EU passed legislation to modernise farms, to promote professional training, and to renew the agricultural work force by encouraging farmers to take early retirement. Other measures focused on assistance to farmers working in difficult conditions, such as hill farmers.
CAP tackles "food mountains" (1980s)
The common agricultural policy successfully moved the EU towards food self-sufficiency, but to such a degree that it had to fight with permanent surpluses of food production ("food mountains"). Those surpluses were either exported, with the help of subsidies, or stored or disposed within the EU. These measures had a high budgetary cost, distorted some world markets, did not always serve the best interests of farmers and became unpopular with consumers and taxpayers.
In 1984 the EU introduced milk quotas, extending the production quota system already applied to sugar.
In 1988, a maximum ceiling for the CAP budget was introduced. A limit on the quantities guaranteed to receive support payments was also set.
Reforming the CAP (1992-2013)
Major reforms shaped the CAP in 1992, in 2003 and in 2013.
- 1992: the 'MacSharry' reform - named after the then-Commissioner in charge - started the shift from product support (through prices) to producer support (through income support, direct payments)
- 2003: This reform consolidated the shift to income support by the introduction of a single payment scheme not linked to production of any particular product ('decoupled') and introduced the 'cross compliance' concept, linking payments to respect of food safety, environmental protection and animal health and welfare standards
- 2013: This reform underpinned producer support, integrating a more land-based approach and sustainable agriculture with 'green' direct payments
Overview of the CAP 2014-2020
In addition, the Commission's Agenda 2000, adopted in 1999, established economic, social, and environmental goals within the objectives of the CAP, while the CAP "Health Check", agreed by EU agriculture ministers in November 2008, simplified and modernised the CAP, removing restrictions on farmers to respond better to signals from the market and to face new challenges such as climate change, water management and bio-energy.
All of these reforms have led to the CAP that we know today. However, the policy has always evolved to better face the challenges ahead, which is why in 2017 the European Commission launched a consultation process on the CAP after 2020: modernisation and simplification.