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reference to MSs CAP Strategic Planning. The setup of the article is the following: In Section 2, the new CAP regulation proposal, focusing on ‘greening’ is put in context, reviewing the policy background and intervention logic of both the current and the proposed new CAP.
Chapter 3 introduces PES and the research on PES effectiveness, and argues why CAP ‘greening’
is a PES-type construct and how its effectiveness can be viewed in the PES framework. In Chapter 4, potentials in the effectiveness of the new CAP will be discussed in the PES framework, then Conclusion in Chapter 6 sets directions for further research.
II�2�2� CAP and its
„greening” component
As agriculture has pivotal impact on climate and environmental sustainability, CAP is a major instrument to implement the EU’s environmental policies.
Sustainable management of natural resources is one of the three policy objectives in the 2014-2020 CAP (along with assuring viable food production and balanced territorial development), and its greening component (CAP ‘greening’) relate directly to the EU’s biodiversity strategy. CAP financing amounts to about 30% of the total EU budget,
and ‘greening’ is a major element in the CAP intervention logic and direct payments mechanism.
Therefore, financial efficiency and environmental effectiveness of the CAP ‘greening’ is of crucial importance. To provide a framework for further analysis in the subsequent sections, in this section the policy context of the CAP greening measures is reviewed.
Policy framework of the CAP greening component The policy framework of the CAP greening component is set by the EU’s biodiversity strategy, along with the Birds Directive and Habitat Directive. The headline target of the Biodiversity Strategy to 2020 (ec 2011) positions the objectives of the EU in a global context: “Halting the loss of biodiversity and the degradation of ecosystem services in the EU by 2020, and restoring them in so far as feasible, while stepping up the EU contribution to averting global biodiversity loss. Among the six targets of the strategy, Target 3. (Ensuring the sustainability of agriculture, forestry and fisheries) has particular relevance to the CAP:…by 2020 the agricultural area …under the CAP shall be maximized, so as to ensure the conservation of
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biodiversity and to bring about measurable improvement in the conservation status of species and habitats that depend on or are affected by agriculture and the provision of ecosystem services… Action 8 within Target 3 is specified as follows: Enhance CAP direct payments to reward environmental public goods such as crop rotation and permanent pasture; improve cross compliance standards for Good Agricultural and Environmental Conditions (GAEC)… (allience enviRonment 2019 p. 4).
Since 2015, the economic and policy context of CAP has changed significantly: agricultural prices have fallen substantially;
international trade negotiations moved from multilateral to bilateral and the EU signed up to new international commitments:
COP21, i.e. the Paris climate agreement and the UN Sustainable development goals (SGD). The commission concluded that, in order to maximize its contribution to the (EUs) Sustainable Development Objectives the CAP must be modernized…simplified…
and made more coherent with other EU policies… (ec 2018a).
The intervention logic of the current CAP is framed in the setup of horizontal, Pillar 1 and Pillar II measures. In the current, reformed CAP, the long time existing direct payments to farmers (Pillar I) were complemented with measures with direct impact on the environment (euRopean paRliament 2013), as defined in Chaper 3 of the regulation:
Payments for agricultural practices beneficial for the climate and the environment. These payment for
‘greening’ is conditional to the practices of diversifying crops, the maintenance of permanent grasslands and designating ecological focus areas (ibid. Article 43, 2.).
The architecture of the new CAP (Figure 1) is supposed to deliver the higher environmental ambitions. Hereinafter, to discuss the detailes, the relevant EC Communication (ec 2018a) and a blog by Matthews (mattheWs, a.
2018b) are referenced. Increased flexibility towards implementation and voluntary actions are two key elements of the setup and the whole system rests on enhanced conditionality.226 thousand station (Figure 1).
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Figure 1: Architecture of the new CAP Source: mattheWs, a. 2018b
Policy framework of the CAP greening component The core of the new proposal on conditionality relates to the 10 Good Agricultural Environmental Conditions (GAEC) in four effect groups: (1) climate change; (2) water; (3) soil and (4) biodiversity and landscape. In the proposal, new requirements are added to crop rotation, maintaining permanent grassland and ecological focus area, in the currect CAP, and direct reference is made to respect obligations under the Water Framework Directive and the Sustainable Use of Pesticide Directive. The requirement of enhanced conditionality (i.e. the possibility to reduce payments upon non-performance), as it will
be discussed later, would align with researchers’ findings that suggest conditonality to be one of the three key PES effectivenss factors. However, it is not clear, if, in practice, payments would be reduced, or even rejected upon non-performance.
Eco-schemes
In the new CAP, MSs would be required to draw-up various eco-schemes, depending on their local conditions and needs, defined as voluntary schemes for farmers.
Eco-shcemes would be paid for additional to the basic income support, or as a compensation for additional costs incurred. The Commission would recommend designs for eco-schemes, however,
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Member States would be free to design their own ones, subject to approval by the Commission.
Agri-environment-climate measures
In the AECM scheme beneficiaries are compensated for the costs incurred and income foregone resulting from the commitments made. As opposed to eco-schemes, which incentivises farmers, under AECM payments it was allowed to make payments to both farmers, as well as other beneficiaries. As regards voluntary AECM, several intervention measures in the Rural Development Regulation would be collapsed into a single scheme in the new simplified system.