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
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