Distinguished guests, MEPs, Minister, ladies and gentlemen, it is my particular pleasure to welcome so many of you to this conference today as we mark the latest milestone on the journey towards the future of the Common Agricultural Policy.

It is almost seven months to the day since President Juncker confirmed that the Commission would move on the "modernisation and simplification of the Common Agricultural Policy to maximise its contribution to the Commission's political priorities and the Sustainable Development Goals."

Since then, we have undertaken numerous discussions in various fora as well as an extensive public consultation. Today is the next stage in this process, with the presentation of that public consultation as well as short presentations from the Commission workshops on the economic and environmental as well as the societal dimensions of the CAP.

But today is really your day – the programme is organised in a way that maximises the amount of time that you, the stakeholders, will have to contribute further to the debate about the future of the CAP. Today presents you with an opportunity to repeat or elaborate on your views or, perhaps, to take issue with and debate some of the comments you hear from others.

I hope I will have the opportunity to meet many of you throughout the day and I will return to the conference for the final "the floor is yours" session this afternoon to listen with interest to your views.

The public consultation provided the platform not alone for a huge response, but also for a diverse response from a wide range of stakeholders. The CAP is a comprehensive policy which touches on every citizen of the European Union, no matter what our background. It is appropriate that as many and as many different voices are heard.

Debate is healthy and I'm sure that today's event will provoke a debate that will help to inform the preparation of the Commission's Communication.

The response to the public consultation and the huge over-subscription to today's conference show the interest that there is in the Common Agricultural Policy, a policy which continues to support a dynamic agricultural sector, ensures safe and high quality food for 508 million Europeans and provides for significant investments in rural areas.

But today must also be seen against a wider backdrop. It has to be seen against such issues as a challenging market situation, our international climate-related commitments, the need for generational renewal, strong international trade figures, a greater focus on simplification and performance and the debate on the future of the MFF.

Following the market difficulties of 2014-2016, there are clear indications of market recovery, though millions of farmers are still showing signs of what was a bruising encounter.

Despite, the exceptional support which the European Commission was able to provide, I am sure we all share the view that we must do what we can to improve resilience.

This has to be part of our systemic approach to agricultural policy and, indeed, I have had many calls from farmers themselves, who are anxious to have the necessary instruments available to face the uncertainties and volatility that characterise today's economy.

I've spoken about many times about the European Union's full commitment to its international commitments, particularly in relation to the Paris Agreement and the United Nations' Sustainable Development Goals.

These commitments demand that we improve the sustainability of food production in Europe, while acknowledging the enormous contribution that farmers already make to the rural environment, to rural growth and, by extension, to society in general.

In my Outlook speech last December, I also identified the issue of generational renewal as one that needed to be addressed. I appreciate that it is not a universal problem, but in a number of Member States, the age profile of farmers is disconcertingly high.

Indeed, last week's Court of Auditors' report highlighted the issue. The number of young farmers fell from 3.3 million in 2005 to 2.3 million in 2013.

As you are also aware, agri-food exports are continuing to perform very strongly with exports in April worth in excess of €10 billion and a net positive trade balance of €860 million. Yesterday, President Juncker and Prime Minister Abe concluded negotiations on a long-awaited economic partnership agreement with Japan, which includes a very positive outcome for the European agri-food sector.

The agreement presents an enormous opportunity for European agriculture and the agri-food sector to grow the EU's fourth-biggest market for agricultural exports, which is worth €5.7 billion annually.

The agreement provides access for 50 500 tonnes of beef at a much reduced tariff rate of 9 per cent, down from 38.5 per cent. Tariffs on wine, sparkling wine, other alcoholic beverages, processed pork and hard cheese will be eliminated altogether and there will be virtually free trade access for pork. Full protection will be granted for 205 European geographical indications from 21 Member States which means that these products will have the same level of protection in Japan as they have in the EU today.

The outcome means that 85 per cent of EU agri-food products exported to Japan will be liberalised over time.

We will continue our efforts to access new and emerging markets and I have no doubt that there will be significant opportunities for Europe to grow its third-country exports and the agri-food sector should be positioning itself to benefit from those opportunities.

Of course, there are also challenges facing European agriculture. Foremost among those is the decision of the United Kingdom to leave the European Union and the consequences that decision will have both in terms of the EU budget and the new trading arrangement that will apply between the EU and the UK.

Last week's Commission Reflection Paper on the Future of the EU Finances pointed out that the gap in EU finances arising from the UK's withdrawal and from the financing needs of new priorities need to be clearly acknowledged and make the perhaps obvious point that hard choices will have to be made.

I appreciate that the paper and some of the scenarios set out have generated some cause for concern. But, it is a reflection paper which has to include all potentially possible options and, in this context, it is inevitable that the paper should look in particular at the reform of the two biggest spending policies (agriculture and cohesion).

However, it is also worth noting that the paper states clearly that "no programme or instrument supported by the EU budget should be exempt from the EU value added test." 

Indeed, the paper recognises the very valuable role that the EU plays in supporting a dynamic agricultural sector with around €400 billion in the period 2014-20, which has a significant redistributive effect. The paper also reflects the importance of the EU's sustainability policy and recognises that farmers provide a stable and high-quality food supply, which is produced in a sustainable way. The paper acknowledges that "viable rural communities are necessary to ensure the sustainability of the vast majority of EU territory". And I wholeheartedly agree with this statement.

Given that the Brexit fundamentally changes the status quo, the reflection paper is designed to stimulate further debate regarding the future direction of the EU budget and how it could be used. In this regard, it should be recalled that this is a reflection paper and not the MFF.

The debate on the paper will continue throughout the rest of this year and the Commission will have regard to all reactions and responses to the White Paper and the reflection papers in the preparation of its proposals for the next MFF.

I want you to participate in this discussion, as a natural continuation of your participation to our public consultation today – the budget is the means to achieve our objectives, and it is only natural that you should have your say. You should also make sure that your governments know what you think, as they are ultimately responsible for the EU budget.

But while the discussion on the budget continues, we are well advised to use our time to look at our policy and how we can improve it. As you know, I have placed a particular priority on the issue of the simplification of the CAP.  There is, as I'm sure you all agree, room for improvement.  The current rules, many of which involve considerable administrative complexity, lead to an excessive focus on error rates rather than achievements.

I believe the following could prove helpful for beneficiaries:

  • We should shift the focus of the policy management from compliance to result orientation, in order to reduce and improve the controls and administrative burden on everybody, but in particular for farmers.
  • Where appropriate, greater subsidiarity for Member States would allow sufficient flexibility to manage the policy in the most appropriate manner, while the EU continues to set the objectives and targets to be met. 

In addition, I recently asked my services to look at ways to use new satellite data and new technology to facilitate and maybe even replace burdensome on-the-spot-checks. This should help to simplify the life of many beneficiaries and paying agencies.

Ladies and gentlemen, my contribution this morning has been designed to set something of the background against which the Commission's Communication is being prepared.

That said, today is your day. It is your opportunity to elaborate on and develop some of the ideas which you set out in your responses to the public consultation.

I hope that as many of you who wish get the opportunity to make your case today, I hope that you will generate some constructive debate and I sincerely trust that we can all leave here this evening enriched by the debate and exchange of views.

Thank you for your interest in participating and I look forward to the fruits of your work.