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NFUS Guide to the Edinburgh Greening Conference

NFU Scotland is holding a two-day international seminar to discuss the ‘greening’ of support payments delivered to farmers under the Common Agricultural Policy (CAP). The seminar will take place at the Moredun Institute, Edinburgh on Monday, 30 April and Tuesday, 1 May 2012.

The CAP delivers agricultural support across the 27 member states of the EU. The European Commission’s draft regulation for a new CAP to operate during the period 2014 to 2020 was revealed in autumn 2011. The draft contained a proposal that 30 percent of the direct support available to farmers would only be paid providing a set of ‘greening’ requirements is met.

The requirements include ecological focus areas (EFAs), crop diversification and the maintenance of existing areas of permanent pasture at farm level.

The proposed greening rules would apply across the EU irrespective of the diversity of landscapes, agri-environment needs, or farming systems. Even within a region such as Scotland, NFUS believes a uniform approach to greening is too blunt and over-prescriptive.  Moreover, the combination of requirements would give rise to unintended consequences as individual farmers strive to meet what would effectively be a complex additional tier of cross-compliance.

NFU Scotland’s seminar brings together a targeted audience of key stakeholders involved with the CAP negotiations. It aims to reach a common understanding of the potential impacts of the current greening proposals at the farm, regional and sectoral level, and then examine alternative approaches to greening of farm support.

Introduction

The debate on the ‘greening’ of direct support payments has a long way to run. While it is almost certain that the next CAP package will carry greater environmental responsibility than ever before, its implementation will be critical.

While NFU Scotland believes the current proposals on greening are flawed, this seminar brings together key stakeholders and policymakers to gauge the views of others and to tease out alternative approaches.

The EU Commission’s draft regulations on CAP post 2013 contain a proposal that 30 percent of the direct payments envelope (Pillar 1) of each Member State should be paid to farmers so long as a set of ‘greening’ requirements are met.

The requirements include ecological focus areas (EFAs), crop diversification and the maintenance of existing areas of permanent pasture at farm level. Organic farmers would automatically receive the greening payment. The proposals do not allow those seeking Pillar 1 support to opt out of greening requirements, as not only would 30 percent of possible support be given up, but compliance and penalties would also apply to the basic area payments that farmers would look secure.

At 30 percent of the ‘agreed’ (but not yet ‘approved) CAP budget, greening will account for around €90 billion from 2014 to 2020 across all member states. In a purely Scottish context, greening could equate to around €1 billion of support to Scottish agriculture over the same period - so there is a lot to play for in making sure greening fits with Scotland and European farming systems. 

Some have welcomed the Commission’s attempt to link direct payments more specifically to measures designed to deliver improved environmental outcomes.  But NFUS – and many others – have been both critical and sceptical about the proposals.

In our view, they are cumbersome and costly to implement for both farmers and administrators, of dubious environmental benefit and have the potential to reduce food production at a time of tightening food supplies.   We believe the proposed measures are intended to provide environmental benefits but will have impacts on farming practices and hence involve associated costs.

While NFUS has set out its initial views on greening, the conference taking place near Edinburgh will bring together an international group to examine the current proposals and develop other approaches that might be less onerous and less costly, and deliver real environmental benefit without compromising agricultural production or farm business viability.

Greening proposals in detail

There are currently three elements to greening – crop diversification (three-crop rule), permanent grassland, and ecological focus areas.

Three crop rule
Crop diversification would require that where the arable land covers more than three hectares and is not entirely under grass or left fallow, at least three different crops would be grown. None of these would be less than 5% of the arable land and the main one would not exceed 70%. This three-crop rule is aimed at arable areas to avoid monocultures.

The rigidity of the crop diversification proposal causes difficulty in terms of application at farm level, yet agricultural monocultures are simply not an issue in Scotland and many other member States.

The requirement for the three crops to cover the arable area of a farm will be difficult both to implement at farm level and to control at administrative level. Ensuring compliance with this provision at individual farm level will require substantial additional administration, monitoring and inspections to establish the area covered by each crop as a proportion of the overall holding. 

Separate sowing, spraying and harvesting regimes for three different crops could prove impractical, especially where the unit size is limited and where the prevailing climate limits the opportunity for field activity. Together with the proposed three-hectare threshold, the three-crop rule could discourage farmers and crofters from any tillage. Such tillage areas on largely grass-based livestock farms provide biodiversity benefits, especially for farmland birds.

And not all areas of the EU have the same range of crop options: northern Europe experiences comparatively high rainfall and low temperatures, providing short windows of weather for key field operations, again making a planned crop diversity impossible to establish or harvest. Parts of Scotland will struggle to find three suitable crops, particularly on livestock farms where spring cereals are grown only for on-farm feed.

Permanent grassland
Greening will also require farmers to maintain as ‘permanent grassland’ the areas on their holdings declared as such at the start of the new direct support measures. So the definition of permanent grassland is key. The proposals suggest that anything over five years should be deemed permanent grassland. This is an attempt to protect soil carbon.

It does not make practical sense to introduce a requirement at individual farm level to maintain permanent grassland in Scotland. The measure may have the undesired effect of actually precluding traditional mixed farming practices that are helpful to maintain soil structure, organic matter levels and the general sustainability of soils to maintain food production. 

Improving grassland efficiency could play a key role in Scottish farming’s efforts to help tackle climate change while contributing to a growing food sector, through better yielding grasses, increasing efficiency and reducing emissions. The proposal would curtail the potential for reseeding pastures necessary to meet future production and climate change demands. 

Climate change and water quality priorities will increasingly drive strategic reseeding of areas where sward diversity is not a priority. The establishment and maintenance of the clover component is key if the use of artificial nitrates is to be optimised.

Ecological focus areas
The ecological focus areas (EFAs) element in the proposals demands that at least 7 percent of a farm’s eligible hectares, excluding areas under permanent grassland, are left fallow, have farm woodlands, contain landscape features, or are used as buffer strips, etc. EFAs are aimed at improving biodiversity.

At 7 percent, the area of eligible land per farm to be devoted to EFAs is significant and does not discriminate according to the size of the holding. It would involve additional administrative control to monitor compliance.  

In 2010, there were around 550,000 ha of crops – barley, wheat, oilseed rape, oats, potatoes and other crops - planted in Scotland. A 7 percent EFA could remove crop production on 38,500 ha of arable land. Would the associated environmental benefits match the financial costs to farm businesses?

Ineligible land might count towards this obligation, which could be of real value to some farms and take account of their biodiversity, which is already rich. However, EFAs still present a significant challenge for some of our most productive farms where soil types, optimal drainage etc. allow a more intensive pattern of cropping.

Alternative approaches

Given the EU’s commitment to green Pillar 1, we need to identify greening requirements that can deliver real environmental benefits without compromising food production or imposing disproportionate compliance costs on farmers and administrators alike.  We have to consider what other options could be used that fit with Scotland and Europe’s diverse farming landscapes in a fair, even and cost-effective way. 

Options may include the following:

  • Modifying the Commission’s proposals - consider the option of reducing or removing the current greening requirement and/or making the greening payment an opt-in payment so that it is effectively voluntary. Adjusting one or more of the greening measures might also provide a way forward. This could include modifying the permanent pasture restriction; reducing the crop diversification requirement to a two-crop rule; providing exemptions from crop diversification rules for livestock units growing their own feed, or lowering or removing the 7% requirement for EFAs.
  • A menu approach – Considering more targeted and tailored schemes. Member States or regions (such as Scotland) could define their own menu of measures that were much more applicable to local environmental challenges and farming systems.
  • Extending exemptions - The proposals contain an exemption for organic farming. If one sector of agriculture is recognised for its commitment to the environment, then this could be extended to others.
  • Extending Good Agricultural and Environmental Requirements -  Recipients of support are currently required to comply with Good Agricultural and Environmental Condition (GAEC). There is potential to add green elements to the current list of GAEC requirements with a view to increasing the baseline for agri-environmentally beneficial practices.
  • Rural Development (Pillar 2) – Deliver greater environmental benefit by having the right measures and increased funding in Pillar 2.

The above list is not exclusive and debate at the seminar may reveal other alternatives.

In Summary

The current greening proposals, if implemented in the way they are currently set out, could potentially have a large negative impact on farm-level profitability and production decisions for a host of farm types and sizes across Scotland, the UK and northern EU Member States.  Effects could be relatively more or less severe depending on which region or farm-size group is considered. The greening proposals are intended to provide environmental benefits and the potential costs identified should be considered in this light.

NFU Scotland’s greening conference brings together a select group of politicians, civil servants and other policy specialists to look at the ways in which we can achieve the best greening outcome for Scotland as well as the arc of northern EU member states with whom we share similar landscape, weather and production patterns. The aim is to create as much common ground across like-minded EU member states as possible and use that to secure sensible changes to CAP greening proposals when reform negotiations are concluded.

Ends

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