And those are 27 member states with completely different interests, and so the European Council of Agriculture Ministers has been negotiating for more than two years. They did not have to start from scratch, but could build on a proposal from the European Commission.
In 2018, this gave the starting shot for the renewal of the EU’s agricultural policy. The current policy dates from 2013. The Common Agricultural Policy (CAP), one of the foundations of the European Union, started in 1963 and has been five times thoroughly.
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Agricultural policy overhauled
Because over the years farming and the economy have changed. In the early years of the policy, the main goal was to guarantee European farmers a higher price for their products than the price on the world market, says Petra Berkhout, agricultural economist at Wageningen University.
That guaranteed price also led to surpluses, the infamous butter mountains and wine lakes. And that is why intervention was necessary, Berkhout explains. The policy was overhauled: keeping prices artificially high was abolished. European subsidies have been used to supplement farmers’ income since the 1980s.
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How much subsidy farmers receive now depends on the number of hectares of agricultural land they have. A condition for subsidy is also that farmers adhere to an extensive set of rules.
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Commission wants greening
The European Commission is not going far enough anymore, because there is no extra incentive to make agriculture more sustainable and less polluting. The idea is therefore to make part of the subsidy dependent on extra things that farmers do to make them greener.
Opinions differ on how large that part will be. The Commission proposed 20 percent, the European Council agrees. But in the European Parliament people are arguing for a higher percentage of 30 percent.
Deployment of the Netherlands
That was also the commitment of the Netherlands, says Deniz Horzum, spokesperson for the Dutch Permanent Representation to the EU in Brussels. “But in the current field of influence this was the maximum achievable and still a nice outcome,” he says.
Berkhout also understands this defeat for the Dutch interest. “It makes more sense to do more nature and climate, but at some point a compromise has to be reached.”
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In agriculture, the Netherlands is a lot further ahead than countries such as Poland and Hungary, Berkhout explains. “And France, Italy and Spain still get a lot of money. It is sometimes difficult to farm in those countries, on mountain slopes for example.”
Work for 22 million Europeans
Without European aid, agriculture would not be profitable in many regions of those countries, although it is often one of the few sources of work. There are roughly 10 million farms in the EU, providing jobs for 22 million people.
Incidentally, the Netherlands can be quite satisfied with the outcome of the ministers’ negotiations, Berkhout emphasizes. “Ultimately, a level playing field, of a Europe with open borders, is most important to us. Because we produce more than we need,” says Berkhout. “The Netherlands benefits greatly from a well-functioning internal market.”
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Minister Carola Schouten (Agriculture, Nature and Food Quality, ChristenUnie) is satisfied with the agreement that ‘is good for the farmer, and good for nature, the environment and climate‘. There are also points for improvement, says spokesman Bertine Moenaff-Fennema. “Our concern is whether this will also lead to fewer rules. That remains a point of attention that we will have to keep an eye on in the coming period.”
How much money is it?
Many tens of billions. Agricultural subsidies were good in the 1980s for more than 70 percent of the entire EU budget. Over the years, this percentage has fallen, partly because the EU budget has increased significantly. Last year, EUR 50 billion went to the EU’s agricultural program, which is 37.4 percent of the total EU budget.
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How much of that is for the Netherlands?
In 2019, Dutch farmers received 768.9 million euros in agricultural subsidies, reports Michel Maas, spokesperson for the Netherlands Enterprise Agency (RVO). This organization, which falls under the Ministries of LNV and Economic Affairs, is responsible for distributing the subsidy.
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In recent years, the amount of subsidy that ended up in the Netherlands has fallen steadily: in 2013 it was still more than 1 billion euros.
Has it been arranged now?
No. Far from. The countries met for two and a half years on this compromise. The European Parliament will vote on the European Commission’s proposal this week, and may also submit proposals for amendments.
The result of the discussion in the European Parliament and the agreement of the member states then enter the Brussels negotiating circuit, called trilogue. Herein the Commission, European Council and Parliament negotiate a compromise. And that can be a time consuming process. “In 2013 it took six months”, Berkhout recalls.
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