President von der Leyen recognises that at least €400 billion are needed for the CAP

Yesterday, President Ursula von der Leyen sent a letter to the European Parliament and to the Council outlining some possible evolutions in the position of the European Commission with regard to the 2028-2034 EU budget.   

For the Common Agricultural Policy, namely, an amount of €45 billion may be added to the €297.3 billion ring-fenced CAP in addition to €48.7 billion rural fund which would be open to farmers (initially excluded) and €6.3 billion in crisis funds. In addition, greater possibility would be given to the Member States within their national plan for crisis management. 

It’s important to underline that at this early stage in the MFF negotiations, in the Commission’s letter, these proposed €45 billion and €48.7 billion are only options given to MS to preserve (or even slightly increase) the CAP funding for their farmers, not an obligation to mobilise these resources. Farmers would have to negotiate with their own capitals to make it happen, further undermining an already weakened C of the CAP. 

In total, potentially, this could give up to €400 billion in current euros, which is €13 billion more than the current CAP amount in current euros, which can be interpreted as compensating for inflation of 0.7% per annum over the period. But this is not secured, just a discretionary option for the Member States. 

The €45 billion are in fact 2/3 of the sums initially budgeted to adjust measures in the course of the 2028-34 financial period, made available from the outset. This sum was planned to be released mid-term in the context of the overall NRPP. It would give an advantage to the Common Agricultural Policy over the Cohesion. 

As regards the €48.7 billion, the explicit opening up to rural development-type agricultural measures is a concrete step forward, as initially these were rural measures that explicitly excluded agricultural measures. With this proposal, it seems possible to pursue traditional agricultural rural development in particular investments on farms. However, this must be validated by clear and explicit legal wording targeting the CAP measures concerned. 

Overall, this letter represents a potential improvement. If all options were unlocked by the MS, this would be the first time in a long time that the CAP budget could show (small) growth, but there is a big IF as nothing is secured at EU level, which shows the lack of appetite from the current Commission to defend common approaches. 

It also remains to ensure that the general NRPP performance framework (environmental indicators only) does not apply to the CAP, but that a specific agricultural framework is defined (with socio-economic indicators).

Ultimately, the Commission is moving forward with both accounting sleights of hand to give the CAP a boost and real progress. There is still a long way to go, as President von der Leyen’s letter is not a deal in the Council, this is just a letter, following bilateral contacts with one single Member State.

In the Council, some Member States still oppose the 2000 billion EUR overall budget. What is important to keep in mind from President von der Leyen’s letter is that the Commission considers now that at least 400 billion EUR are needed for the CAP, not 300 billion EUR.