The Common Agricultural Policy after 2013 - Environment, Food and Rural Affairs Committee Contents

4  The budget of the CAP in the post-2013 financial framework

75.  Negotiations on the future CAP are proceeding concurrently with negotiations on the next Multiannual Financial Framework. Given the current economic situation in the EU, there is of course considerable interest in achieving greater value for money from EU spending.

76.  The Commission has not yet given any figures for the future CAP budget; it is expected to produce a Communication on the next Multiannual Financial Framework before July 2011 including a breakdown of the budget for the CAP. The 2010 EU Budget Review noted that the CAP budget had fallen in recent years, but still represented a major public investment.[116] Somewhat surprisingly, the Review did not recommend any direction for the future CAP budget. Commissioner Ciolo? has been clear that a significant reduction to the budget would require a substantial re-thinking of the policy.[117]

77.  The European Parliament's resolution on the CAP post-2013 said "it is essential that the budget the EU allocates to the CAP is at least maintained at current levels".[118] However George Lyon MEP, who drafted the resolution, suggested this was rather optimistic; he told us:

I don't think that we are likely to see any increase whatsoever in the Common Agricultural Policy budget. Indeed I think it's more than likely that it will start to decrease over time. The question is not if; it is a question of when.[119]

78.  Defra argued unequivocally for a reduction in the budget, stating:

Spending on the CAP will need to reduce very materially during the next Financial Perspective: the future CAP must be affordable, and EU spending on agriculture must deliver real value for money for EU citizens.[120]

79.  Our witnesses were cautious about the potential effects of a substantial cut to the budget. The CLA said "Our fear is that the UK will set extremely high ambitions and expect them to be delivered from an unreasonably low budget".[121] The RSPB also felt that the current budget would need to be retained to meet its ambitions, saying "I would wager that to meet those environmental outcomes the CAP budget would not be less than what it currently is, although I appreciate there is considerable pressure for all Member States to reduce spend".[122]

80.  Witnesses from the devolved administrations did not echo Defra's calls for a substantially reduced budget. The Northern Ireland Assembly Minister of Agriculture and Rural Development said: "I cannot support calls for significant reductions to the CAP budget and, in particular, to direct support for agriculture".[123] The National Assembly for Wales Rural Development Sub-Committee's inquiry into CAP reform recommended that "it is essential to protect the CAP budget".[124] The Scottish Executive Cabinet Secretary for Rural Affairs and the Environment expressed concern "that the Defra position is clearly being driven by budget considerations and that the UK Government is paying no attention to the needs of farming in the UK and especially in Scotland".[125]

81.  It is important to note that EU funding is the centre-piece of spending on agriculture and the environment in the UK. In 2009-10, the amount that Defra received from the EU to spend on EU-specified agriculture and environment programmes was greater than Defra's nationally-funded expenditure on all its other responsibilities.[126]

82.  In light of current financial circumstances, we believe there is room for savings to be made within the CAP budget while still delivering its core objectives. However Defra must be mindful that severe budget cuts could incur greater costs in the long-term if they result in depleting the EU's natural and social capital.

116   European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee, the Committee of the Regions and the National Parliaments-the EU Budget Review, October 2010, p 11. Back

117   Q 196 Back

118   European Parliament resolution of 8 July 2010 on the future of the Common Agricultural Policy after 2013 (TA(2010)0286, para W. Back

119   Q 278 Back

120   Ev 170 Back

121   Ev 115 Back

122   Q 22 Back

123   Ev w29 Back

124   Ev w22. The Welsh Assembly Government's response expressly did not express an opinion on the budget (Ev w33). Back

125   Press release by the Scottish Executive, 19 January 2011.  Back

126   Defra's budget for 2009-10 was £3.08bn falling to £2.2bn by 2014-15. Its expenditure on the Single Payment Scheme in the same year was £1.89bn and its expenditure on the RDPE was £0.36bn, of which approximately one half is financed nationally, giving a total EU-funded spend of £2.08bn. In 2009-10, the Department spent £0.45bn on its Departmental Spending Objectives related to food and agriculture (DSO6, DSO7), £0.96bn on the environment (DSO 2) and £1.5bn on other objectives. (Sources: Defra, Resource accounts 2009-2010, p 49; Defra, Main Estimate 2010-11 Select Committee Memorandum; Rural Payments Agency, Annual Report and Accounts 2009-2010). Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2011
Prepared 15 April 2011