Voluntary coupled support explained
Under the Common Agricultural Policy, the link between the receipt of income support payments and the production of specific products has been progressively removed (‘decoupled’). This is to avoid overproduction of certain products and make sure that farmers are responding to genuine market demand.
However, in some situations targeted aid to a specific agricultural sector or sub-sector may be needed as it is undergoing difficulties. The VCS scheme aims to prevent the escalation of these difficulties, which could cause abandonment of production and could affect other parts of the supply chain or associated markets.
Therefore, EU countries may continue to link (couple) a limited amount of income support payments to certain sectors or products. However, this is subject to various conditions and to strict limits to mitigate the risk of market distortion.
This support scheme is known as voluntary coupled support (VCS).
VCS in practice
VCS is what is known as a production-limiting scheme and is designed to limit the distortion of market competition.
The potentially eligible sectors are cereals, oilseeds, protein crops, grain legumes, flax, hemp, rice, nuts, starch potato, milk and milk products, seeds, sheepmeat and goat meat, beef and veal, olive oil, silkworms, dried fodder, hops, sugar beet, cane and chicory, fruit and vegetables and short rotation coppice.
In order to finance voluntary coupled support, EU countries may:
- use up to 8% of their total income support budget;
- if certain prerequisite conditions are met raise this to 13%;
- this may be raised higher than 13% if approved by the EU Commission and the support meets very strict criteria;
- this percentage may be further increased by an additional 2% to specifically support the production of protein crops.
EU countries may revise their VCS decisions by 1 August of any given year, with effect from the following year.
All EU countries, except Germany, decided to apply the scheme between 2015 and 2020.
The amount of funding and the range of sectors covered vary greatly between the various EU countries.