The much-anticipated final breakthrough in a three-year saga to reform the Common Agricultural Policy (CAP) fell apart in the early hours of Friday morning as European Agriculture Ministers and MEPs failed to reach agreement on a host of key issues.

Many EU Agriculture Ministers blamed MEPs and the EU Commission for being too rigid in their demands, while MEPs blamed Agriculture Ministers for being too wedded to the status quo and not showing enough ambition, particularly in relation to the environment.

Outside the talks, some farm organisations were shocked at the direction the tense negotiations had taken. IFA President Tim Cullinan accused the EU Agriculture Commissioner Janusz Wojciechowski of “trying to turn the CAP into a social welfare payment”, adding that the commissioner, and the EU Parliament, “want to spread the money to keep a larger number of farmers in poverty”.

“Only one third of farmers in Ireland are viable. If the EU get their way, we will have no viable farm families,” Mr Cullinan said.

ICMSA President Pat McCormack said the Irish family farm model would be “critically undermined” under the proposed CAP deal, stressing that Ireland “will have to insist” that member states are given the necessary flexibility to address country-specific issues in any final agreement in order to avoid that scenario.

However, INHFA president Colm O’Donnell said he was left “dismayed” at suggestions from some farm leaders that Agriculture Minister Charlie McConalogue should walk away from the table. “While not ideal, we do acknowledge that it is a move in the right direction,” Mr O’Donnell said.

Although the EU institutions have agreed on 80-90pc of the CAP framework, it remains the case that “nothing is agreed until everything is agreed”. Here is a flavour of some of the key stumbling blocks and compromises that emerged during last week’s ‘super trilogue’.

Eco-schemes

Disagreement on eco-schemes funded from farmers’ direct payments was central to the deal’s collapse last week.

Going into the talks, EU farm ministers said the budget for the schemes should be no more than 20pc, while MEPs called for 30pc.

Ministers offered a compromise of 25pc, yet MEPs were spooked by the fine print, which essentially allowed for the status quo to remain for the first two years of the new CAP programme, a phase proposed by the Council as “the learning period”.

MEPs are under pressure not to compromise amid concern that any row back on environmental action might see the CAP fail to pass a full vote of the European Parliament.

Equally, farm ministers remain under intense pressure from farm organisations not to allow further farmer direct payments to be redirected towards eco-schemes. 

Front loading

While the mandatory redistribution of farm payments made little headlines in Ireland prior to the talks, the issue emerged as another critical factor in the suspension of negotiations. The European Parliament proposed that countries redistribute 12pc of their CAP payments for farmers to smaller farms (front loading). But late in the talks, EU ministers countered with a 10pc compromise and sought flexibility to potentially dodge the proposal if member states could prove that other methods are/will be used to distribute funds fairly.

Convergence

On convergence, MEPs refused to budge off demands for 100pc convergence. While the Council’s starting point was 75pc, the ministers last week put forward a compromise of 85pc.

Again, no agreement was reached on this critical issue for Ireland, which is one of the last countries to go down he convergence route. However, despite some countries holding the line with Ireland, it has been indicated to the Farming Independent by some MEPs that the final figure could be higher than 85pc.

Capping

The capping of farm payments at €100,000 is not a contentious issue in Ireland, but is in other countries, particularly in Eastern Europe. A disagreement has emerged over whether large farms will get an allowance for all labour costs. MEPs want just 50pc of labour costs to by written off.  

Co-financing

Negotiations are understood to have signed off on co-financing rates for the CAP, which determines the extent to which national governments can supplement schemes and payments.

Four rates were established by the Council in July 2020, including 65pc of the eligible expenditure for payments for natural or other area-specific constraints, and 43pc of the eligible public expenditure for other regions. Due to cuts to the overall Pillar 2 budget, the IFA is seeking the maximum possible national co-funding rate to be used in Ireland. 

GAEC 2

It appears that all sides were relatively comfortable with the wording of the new GAEC (Good Agricultural and Environmental Condition), which aims to protect carbon-rich soils, including wetland and peatland areas.

The proposal put forward by the Council outlined that member states, when establishing the standard for GAEC 2, shall ensure that on the land concerned, an agricultural activity suitable for qualifying the land as an agricultural area may be maintained. 

Active farmer

There was little progress made in relation to the definition of ‘active farmer’. The new CAP will limit supports to those specifically defined as an ‘active farmer’ — it is another attempt to stop large businesses and landowners sucking up money. Each member will propose a definition, including tests on how the criteria will be met to ensure part-time farmers will not be excluded.