EXCLUSIVE: Brussels proposes ‘single fund’ CAP but preserves farmers’ direct support

Brussels will include the CAP in a new single fund, keeping farmers’ income support ringfenced but scrapping the rural development pillar, according to a draft document seen by Euractiv ahead of Wednesday’s big reveal.

The next Common Agricultural Policy (CAP) will move under a single national and regional partnerships fund – just as previously floated by the European Commission – preserving direct payments to farmers but effectively scrapping rural development in its current form.

A draft of the regulation, establishing conditions for the implementation of the CAP, proposes "integrating" programmes and tools from the current two-pillar structure – direct support and rural development – contradicting previous pledges from EU farm chief Christophe Hansen to maintain the current structure.

As previously anticipated, the proposal ringfences – meaning that money cannot be shifted to other policy needs – income support for farmers. However, the draft regulation includes in the "types of support" to be assured to farmers a significant part of the traditional support in the rural development area, such as long-term investments.

“A significant part of the Fund is dedicated to income support for agriculture, which is ringfenced with a minimum of EUR XXX from the allocations of the Fund, in order to provide stability and predictability of support for beneficiaries,” the document reads.

The funding “can be augmented” within the one-pot fund, by programming actions that serve more than one objective beyond farming, “such as agro-energy, skills and social infrastructure, water or connectivity.”

Farming subsidies will also be eligible for top-ups from the new European Competitiveness Fund – specifically through its Health, Agriculture and Bioeconomy window – and via Horizon Europe for research and innovation in farming, food systems, and the broader bioeconomy.

“The combination will allow [us] to preserve the tools currently available, for use in an optimised way.”

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Young farmers and capping

The new plan also delivers on “degressivity,” meeting Hansen’s long-standing promise to distribute CAP funding more fairly.

Member states “shall reduce the annual amount of the area-based income support exceeding EUR 20,000 to be granted to a farmer by 25 % where the amount of the area-based income support granted to a farmer is between EUR 20 000 and EUR 50 000.” In addition, payments above €50,000 will be reduced more steeply – by 50% between €50,000 and €75,000, and by 75% for amounts exceeding €75,000.

It also caps area-based payments at €100,000 per farmer annually and strengthens the principle of the “active” farmer. By 2032, member states must ensure that individuals receiving a retirement pension no longer receive CAP payments, thus fulfilling a long-standing demand of young farmers.

Meanwhile, it states that small farmers whose main activity is not agriculture should still be considered as such and be entitled to support.

The Commission is also setting the stage for not one but at least 27 strategies for generational renewal, which it will mandate to create to each member state. “Each Member State should be required to set in the Plan a strategy for generational renewal that should be based on the assessment of the specific national context, in line with the Commission's Vision for Agriculture and Food,” it reads.

Less green rules, more incentives

Hansen has also delivered on the much-anticipated incentives for farmers who choose to farm more sustainably – a significant departure from the current system linking payments to environmental conditions.

The draft states the new CAP should strike “a new balance” between “farm stewardship” – a wide array of existing food safety and climate policies – and voluntary agri-environmental and climate actions.

“The farm stewardship should be established to guarantee compliance of the CAP support with the ‘Do No Significant Harm’ principle,” it reads, meaning that farmers should not significantly undermine the EU’s climate goals.

The new concept of farm stewardship includes “minimum environmental and social conditionality”.

The draft also states that governments may provide area-based support to compensate farmers for the “disadvantages” of implementing key EU green legislation: the Habitats and Birds Directive, and the Water Framework Directive.

Meanwhile, member states struggling with nitrate pollution shall provide support to farmers for the extensification of livestock farms or diversification into other agricultural activities.

(adm, aw)

UPDATE: The article was updated to clarify that the draft regulation includes long-term rural development support, such as investments.