President Maes, Ladies and gentlemen,
It is my honour to be here with you in Ypres today to celebrate your 60th anniversary. Many activities have taken place in Ypres and Flanders this year to commemorate the horror of the First World War, when too many young people lost their lives too soon.
Therefore it is a particularly positive and joyful contrast to celebrate the energy and dynamism of young farmers today!
As Agriculture Commissioner, I have made generational renewal and support for young farmers one of my absolute priorities, even though this is not always the easiest or most popular course of action.
Today I want to tell you about my CAP proposals, which represent a historic breakthrough for supporting young farmers. For the first time, MS will be obliged to spell out in detail all the policies and financial supports they will allocate to generational renewal.
My conviction comes from the fact that I was a young farmer myself, and I understand the ins and outs of a life spent working on the land.
I want to do everything in my power to speed up generational renewal, because your generation is our best bet to keep EU agriculture competitive, sustainable and at the heart of our rural communities.
Today, I want to tell you about my plan for making this happen.
Previous CAP reforms have done a lot for young farmers, including the 2013 reform which allowed MS to offer young farmers a bonus of up to 25% on their direct payments in their first five years of installation.
But there has always been one, seemingly insurmountable obstacle: there is a limit to what EU measures to support young farmers can achieve, because so many of the relevant policy tools are controlled at national level, including taxation and land policy.
That is why we have gone back to basics with our proposal for the next CAP. We have listened closely to CEJA, to our citizens and to our stakeholders, and we have come up with a plan that we believe is not only ambitious but achievable.
The key innovation in our proposal is a new delivery model, which will replace the existing one-size-fits-all approach with a more flexible system.
This new approach will allow greater freedom at national level to decide how best to meet common EU-wide objectives while responding to the specific needs of farmers, rural communities and wider society.
For the first time ever, the crucial importance of young farmers and generational renewal has been explicitly stated as a key objective of the CAP.
This is historic, and unprecedented, and follows through on my commitment to you and the other young farmers of Europe that I would keep you front and centre in my plans.
Responsibility to meet the 9 key objectives is switched to the MS, which must design and deliver a comprehensive plan to address both national and European dimensions of farming, food and rural development policy. This CAP Strategic Plan is the centrepiece of our proposal.
Generation Renewal in CAP Strategic Plan
So here in a nutshell is how it will work: when designing their CAP Strategic Plan, each MS will have to take into account the parameters outlined by the Commission.
Young farmers will benefit from a wide range of instruments, through a combination of mandatory and voluntary aspects:
At least 2% of the national direct payments envelope will have to be devoted to generational renewal. Spending today amounts to 0.8%.
This amount has to be allocated either in the form of top-up income support in Pillar I and/or lump sum installation grants in Pillar II.
This is a very important innovation – Member States will have to “use it or lose it”. Member states may wish to spend more if there are identified needs. You can see that with this financial earmark, we are more than doubling our firepower to support generational renewal!
I believe this compares favourably with your priorities, which argue in favour of supporting the direct payment model as the most straightforward means of rewarding, vibrant, efficient, sustainable active farmers.
Our proposal also includes complementary income support measures: the top-up for young farmers under direct payments is kept and reinforced financially, but Member States will have more capacity to tailor the scheme to the specific needs of young farmers.
In addition, reserves for payment entitlements will be used, as a matter of priority, for young farmers and farmers commencing their agricultural activity.
There will be an increase in the maximum amount of available aid for the installation of young farmers and rural business start-ups, up to € 100.000.
Beyond direct payments, Member States will have the option to support different forms of cooperation between farmers. This could encompass farm partnerships between different generations of farmers;
- It could mean retirement planning and lump sum payments for older farmers who permanently transfer their holding;
- It could mean enhanced transition planning services;
- It could mean improved brokerage for land acquisition;
- It could support innovative national or regional organisations engaged in promoting and facilitating matching services between young and old farmers and so on.
This reflects and even builds upon the strong work done in some MS, including the one I know best, in relation to land mobility.
On top of this, young farmers will continue to benefit from investment support and knowledge transfer and training under the EIP-Agri, through Leader funding and through other rural development interventions.
Member States may also decide to use a certain share of their EAFRD allocation to finance actions in respect of transnational learning mobility with a focus on young farmers, in accordance with the Erasmus Regulation.
Member States will be allowed to establish financial instruments to support working capital: this instrument can be of primary importance for young farmers, who face more difficulties given the high investments and low returns of the start-up phase.
When it comes to Risk management, we know that support for working capital can be important to overcome a crisis, which implies temporary liquidity shortage.
Risk management instruments have been improved in our proposal, allowing MS more flexibility to design tailor-made schemes.
Finally, in the critically important area of national social and taxation policies, Member States will have to present, in their CAP Strategic Plans, a sound strategy to address the generational renewal challenge in their territory and explain the interplay with national instruments with a view to improving the consistency between Union and national actions, notably access to land, access to finance and credit and access to knowledge and advice.
MS will have to describe in detail how national instruments – such as taxation, inheritance law, and the regulation of land markets – interplay with EU-supported interventions for young farmers.
Now let me address how CEJA can support these measures in the coming months.
I will ensure your voices and your priorities are heard loud and clear in the ongoing inter-institutional discussions and in the exchange of views on the preparation of the CAP strategic plans.
For example, my services have asked the European Network for Rural Development to organise a specific seminar to support national authorities on the design of future strategies for generational renewal. I know that CEJA will participate at that seminar, which takes place next week.
Furthermore, I know that colleagues from DG AGRI actively engaged in your assembly yesterday with a view to planning for the future.
Explaining the way the future CAP plan works will allow you to concretely understand how to influence the plan according to your needs.
You need to make absolutely sure that your voice is heard by those authorities drafting the CAP strategic plans at national level.
The Commission will ensure that the CAP remains a truly common and truly European policy, with a level playing field for all.
We will set EU-wide common objectives, the provision of common indicators to measure progress, and keep a watchful eye on Member States, monitoring their progress and intervening whenever necessary.
Of course, a strong policy must also be underpinned by a strong budget. And I want to thank CEJA for your unwavering support for the CAP budget to be maintained or even increased.
Let me give you a brief update on where we stand.
Ultimately, the simple reality is this: in budget negotiations framed against huge pressures both outside and inside the EU, the big spending policies such as the CAP were always going to be first in the line of fire.
Set against the challenges of Brexit, migration, security and escalating trade tensions, the Commission’s proposal for relatively modest cuts to the CAP can and should be viewed as fair.
But the most important point to bear in mind is that the final decision does not lie with the Commission. The Member States, working in co-decision with the European Parliament, have full freedom to increase their overall budget contributions with a view to keeping the CAP at its current level.
I have spoken to ministers in every MS and there is a willingness in a majority of countries to take this approach. But other countries still remain to be persuaded.
Ladies and gentlemen, dear friends, let me conclude by wishing you all the best for the challenges that lie ahead. I hope you will keep a close and watchful eye on both national and European authorities to make sure they are doing their bit to support generational renewal.
I am confident that the Commission’s proposal for the future CAP presents an unprecedented opportunity for young farmers to seize the agenda and put generational renewal on the map.
Thank you, and enjoy your anniversary celebrations.