Europe’s green ambitions run into an old foe: Farmers

The farm industry lobby and leading agri powerhouses like Italy are thwarting the EU’s promises of a Green Deal.

Big agricultural countries and the agri-industry lobby are now pushing back hard against the EU's green ambitions | Damien Meyer/AFP via Getty Images
Politico Pro ARTICLE

BY ARTHUR NESLEN AND EDDY WAX
October 20, 2020 

Europe is promising the earth on green reforms but this week's political battles over the Common Agricultural Policy are heading toward mucky compromises that could turn back the clock on the EU's environmental pledges.

Both EU ministers and members of the European Parliament have this week thrashed out deals over the EU's lavish €48 billion-per-year farm subsidies scheme, but Europe's ecological ambitions are being watered down on both fronts as agri-powerhouses like Italy and Poland push back hard against a wholesale rethink of industrial farming.

After a fresh crop of EU commissioners made the European Green Deal their flagship policy, there were hopes that politicians would make sure the new CAP slotted into the ambitions of making Europe climate neutral by 2050.

But after years of protracted talks during which climate change sparked global school strikes and street movements, big agricultural countries and the agri-industry lobby are now pushing back hard.

Even the European Commission, which largely declined to update its 2018 proposal in light of the Green Deal, has found itself in damage control mode, trying to prevent its blueprint from being emptied of environmental ambition.

Over the past two days, EU Agriculture Commissioner Janusz Wojciechowski delivered warnings to both politicians and parliamentarians. On Monday, he told EU ministers in Luxembourg that he was “concerned about some of the proposals on the table as they will not allow us to reach our objectives."

In the European Parliament, ecologically minded lawmakers are also on the back foot, having been ambushed by seasoned agri politicians who cut their teeth on previous CAP reforms.

Green and some Socialist MEPs reacted with horror when the leadership of the three main parties used a special parliamentary maneuver to railroad through a compromise deal on Tuesday. Senior Green MEP Bas Eickhout described that move as “killing the Green Deal [and] also killing any decent democratic procedure on a proposal affecting one third of the EU’s budget."

Tuesday's parliamentary votes lays the path for Parliament to finalize its position this week. The countries, Commission and MEPs will have to square their positions in a final deal with each other, although nobody expects those rounds of haggling to inject an 11th-hour note of environmentalism.

On Tuesday night, ministers were finding it harder to find a common position in Council and German Agriculture Minister Julia Klöckner complained that binding ecological rules were a chief bone of contention. But they got a deal in the early hours of Wednesday morning. “This was the most important session of the decade, the most important agri and fish Council," Klöckner said in a press conference at just before 5 a.m.
Loopholes on the land use

One of the main debates hinges on so-called eco-schemes. The big idea is that a meaningful chunk of EU funds should be ring fenced for green projects in agroecology, agroforestry or carbon farming. These projects are supposed to be compulsory for EU countries but voluntary for farmers to join.

Denmark’s Agriculture Minister Mogens Jensen, told POLITICO that while an “ambitious ring-fencing” of funds for the Commission's shiny new eco-schemes program was crucial to the Green Deal's success, “I am afraid that the outcome will not be as ambitious as I would hope for.”

Germany proposed a ring-fence of "at least 20 percent" of the direct payments budget for eco-schemes, but hearts sank among reformers when the big loopholes started to emerge. Some degree of compromise is likely as Italian Minister Teresa Bellanova has argued point-blank against the concept of green ring-fencing, saying such a move should only be attempted "following a robust analysis of the real needs."

The political consensus gathering momentum is that the schemes will not run during the CAP’s transitional first two years of 2021 and 2022.

There are also workarounds on the cash. Funds not successfully deployed in eco-schemes at the end of the next two years — 2023 and 2024 — may be poured back into non-green, old-school farming projects.

And from 2024 to 2027, there's yet another compromise emerging based around the two pillars of the CAP. The lion's share of the CAP lies with the direct payments (pillar 1) budget, but there is also a smaller pot of rural development cash (pillar 2). The loophole would be that countries could argue that if they spent more than 30 percent of their rural development funds on green projects, then this should count toward their 20 percent target on eco-schemes in pillar 1. That reduces the scale of ambition in the core pillar 1 projects.
Creative accounting

Greenpeace EU’s Marco Contiero said: “This reform will end up re-doing exactly what the past reform did as if there was no consensus about [its] dire failures.”

Agriculture is widely linked to declines in the population of EU pollinators and birds, as a result of intensive agricultural practices which destroy wildlife habitats and sources of food and shelter.

The last CAP was supposed to earmark €66 billion for protecting biodiversity but an EU auditors report found that not only that it had “little positive impact” but that its tracking mechanisms could not even be relied upon to measure the loss.

The Commission’s solution for this cycle of CAP spending was that countries set aside nature-friendly havens on 10 percent of Europe's agricultural area. Instead, the countries as represented in the Council have proposed maintaining the current threshold of 5 percent of arable farmland, which is a smaller area.

And this could be reduced even more to 3 percent, if another 2 percent of farmland were given over to nitrogen-fixing but productive crops such as alfalfa, sweet peas and winged beans. Alan Matthews, professor emeritus of Trinity College Dublin, dubbed it a “two fingers” salute to the Green Deal. 

Parliamentary package

If anything, the loopholes in a parliamentary compromise crafted by the European Peoples Party, Renew Europe and the Socialists and Democrats in Parliament are even more significant.

The parliamentary package mandates that 60 percent of farm subsidies be spent on non-environmental goals — such as basic income support. And funding for eco-schemes is only allowed if it meets “economic objectives” tied to farmers’ incomes.

Parliament's proposal does pitch an eco-schemes ring-fence at 30 percent and it sets the environmental spending target in pillar 2 at 35 percent. Of this though, it says that a whopping 40 percent must be spent on "areas of natural constraint."

These are also contentious. They cover farming in mountainous, remote or marginal land areas that might otherwise deteriorate. But environmental academics say there is no empirical justification for considering them as climate-friendly. In fact the effectiveness of the rural development pillar’s green earmark has been “weakened by the inclusion of payments to areas of natural constraint,” according to a Commission study.

“It would mean a step backwards compared to nowadays,” warned the Commission's farm chief Wojciechowski in a Parliamentary debate.

Contiero complained that conditioning payments on it for the next seven years “will destroy the credibility of the CAP.”

Environmentalists argue that the Parliamentary compromise deal also allows the continued draining of peatlands and removes a ban on plowing and converting permanent grassland in protected sites.

After Tuesday's vote, the Parliament nonetheless looks set to adopt the compromise deal fully over the course of the week, despite the reservations of S&D rebels like Kathleen Van Brempt who called on "everyone who has a heart for the Green Deal" to vote it down.

The sense that the CAP's farming politics are no longer immune from public environmental scrutiny was all the more apparent when activist Greta Thunberg waded into the fray on Tuesday and tweeted: "Neither council nor parliament appear to care about the climate and biodiversity crises as they strip away conditions for farm subsidies and push for greenwashing loopholes.”