Greening the Common Agricultural Policy

Written evidence submitted by Natural England (GCAP 29)

Executive Summary

· Natural England is the Government’s statutory advisor on the natural environment. Natural England is responsible for delivering, on behalf of Defra, Environmental Stewardship and other schemes which offer payments to farmers and land managers in England for effective land management to protect and enhance the environment and wildlife.

· Our evidence supports the Commission’s assertion that there is value in some level of environmental management to be incorporated into mainstream farming across whole landscapes. For example, looking at the aspirations set out within the England Biodiversity Strategy action at this sort of scale is fundamental if we are to achieve the Biodiversity 2020 targets.

· The Commission’s assessment of the potential environmental benefits of their particular proposal is, we believe, limited, and largely unsubstantiated. Past evidence suggests that greening, as currently proposed, may not generate environmental benefits on the scale that the Commission anticipate, and in some cases there is a risk of significant perverse effects. The Environmental Focus Area is one element of the Commission proposals that does have the potential to deliver significant environmental benefits, but, as currently defined, this would not be in a way that makes the most efficient use of available land and minimises the impact on food production.

· The addition of greening in Pillar 1 will not make the CAP simpler. However, experience from current delivery has demonstrated that delivering environmental benefits effectively is inherently complex, so a degree of additional complexity is to be expected. The question is whether the additional complexity of the Commission’s proposals would be justified by, or proportionate with, improved environmental outcomes.

· The limitations of Pillar 1 funding (annual, non-contractual etc) mean that it is not the ideal mechanism for supporting complex, multi-annual, locally specific environmental management. Experience to date and the available evidence suggest that Pillar 2 is likely to be a more effective mechanism to deliver environmental outcomes.

· Recommendations for improving the greening proposals are essentially policy issues for Government to decide. We are working very closely with Defra (as our sponsoring department) to make available evidence which may support and usefully inform its subsequent chosen policy direction. We would like to emphasise that we are strongly committed to adding constructive value to Select Committee inquiries wherever we can, and it has been helpful to agree with the Committee ahead of our appearance at the proposed oral evidence session on 23rd November that Natural England is not able to discuss or comment upon future policy direction. This, as the Committee has recognised, is a matter for Government rather than ourselves.

1. Introduction

1.1 Natural England is the Government’s statutory advisor on the natural environment. Natural England’s purpose is to ensure that the natural environment is conserved, enhanced and managed for the benefit of present and future generations, thereby contributing to sustainable development.

1.2 Natural England is responsible for delivering, on behalf of the Department for the Environment, Food and Rural Affairs (Defra), Environmental Stewardship and other schemes which offer payments to farmers and land managers in England for effective land management to protect and enhance the environment and wildlife. These schemes form part of the Rural Development Programme for England (RDPE) (2007-2013). It is within this context that our evidence is provided.

2. Will the proposal to green direct payments generate significant environmental benefits?

2.1 Most environmental outcomes depend on positive management to get the best results. This is true for resource protection as much as for biodiversity. Sir Don Curry’s 2002 report [1] supports the Commission’s assertion that there is a need for some level of environmental management to be incorporated into mainstream farming across whole landscapes. It was this report that led to the introduction of Entry Level Stewardship (ELS) in 2006. More recently it has been supported by the findings of the Lawton Review [2] , which has in turn informed the targets set by Government in the England Biodiversity Strategy (EBS) [3] .

2.2 The Commission’s assessment of the potential environmental benefits of their proposal is somewhat limited and relatively unsubstantiated. We also note that administrative constraints have forced them to put forward proposals that are significantly different to the options they originally assessed. The Commission’s proposal for crop diversity would not ensure the rotation of crops and their proposal for permanent grassland would not ensure the conservation of grassland of high environmental value. This is discussed further below.

 

2.3 We feel that a definitive assessment of the potential of the proposals is currently impossible due to the lack of detail in the proposals, much of which is reserved for subsequent implementing regulations and delegated acts. However, we might conclude that it looks unlikely that greening as proposed will generate environmental benefits on the scale that the Commission envisage, and in some cases there is a risk of significant perverse effects. Our evidence to underpin this assessment is outlined below, for each of the specific proposals:

 


2.3.1 Retention of Permanent Grassland

o Grassland that is not ploughed or otherwise cultivated delivers important benefits for biodiversity, the historic environment and landscape character, climate change mitigation and water quality [1] . The extent and nature of these benefits largely depend on factors such as location, extent of previous cultivation/fertilisation/reseeding etc and current management practices. The Commission proposals are based on the current definition of permanent grassland which includes land which may be repeatedly cultivated and sown down to grass again. Retaining an overall stock of grassland would help retain current levels of soil carbon, but might fail to target the most valuable grassland which may be species-rich or underlain by archaeological remains or provide valuable habitat for invertebrates or birds. The Commission proposals would not introduce any restrictions on management practice at the parcel level. This severely limits the scope to maximise environmental benefits.

o A range of existing provisions, such as statutory designations, the Environmental Impact Assessment requirements, and the current CAP requirement to maintain the ratio of permanent grassland at Member State-level, all to some extent restrict the potential loss of permanent grassland. The Commission proposals, in the absence of any more specific targeting and management conditionality, would do nothing to enhance these existing provisions.

o Furthermore there is a real risk that this proposal could potentially be harmful, by encouraging increased loss of grassland in the intervening period, before the 2014 reference date, as farmers seek to maximise their flexibility for cropping decisions in future. The majority of key areas are protected by the existing provisions, although we recognise that there remains a risk to some sites. There is also a significant risk to grassland created from arable reversion through agri-environment agreements that are due to expire between now and 2014, with consequent loss of the landscape, resource protection, biodiversity and soil carbon benefits that may have accrued. The Commission has proposed a way of controlling this risk in the form of a new transitional cross compliance requirement to retain permanent grass parcels in the horizontal regulation [2] . But this may not be fully effective within England as we do not currently have farm level controls on permanent pasture.

2.3.2 Crop Diversity

o A definitive assessment of the extent of change to farming systems, and therefore the extent of any associated environmental benefits, is difficult in the absence of the definition of ‘crop’ in the Commission proposals.

o There is very limited evidence on the environmental benefits of an increase in crop diversity [3] , and much depends on the choice of substitute crops. Conversely there is good evidence on the environmental benefits of crop rotation and also very positive evidence about the benefits of mixed (arable-livestock) farming systems [4] . Unfortunately the inability to prescribe specific crops, or formal rotation, as part of the Commission proposals means that the environmental benefits of this measure are likely to be considerably reduced.

o Additionally there is a risk of the loss of small areas of arable cropping (>3ha) in predominantly grassland areas because it is impractical to manage three different crops on this scale or in some marginal areas. These cropped areas can be important for biodiversity in pastoral areas [5] [6] .

2.3.3 Environmental Focus Area (EFA)

o This is the one element of the Commission proposals that does have the potential to deliver significant environmental benefits. There is a robust body of evidence showing that in the UK and elsewhere in Europe, set-aside did have a positive impact on the farmed environment [7] . However, the precise potential will be determined by the interaction between the percentage EFA requirement, the eligibility of different features as a contribution to the EFA and the nature of any positive management conditionality required – all factors that remain largely unconfirmed in the proposals.

3. The impact of additional greening requirements on food production and the competitiveness of the agricultural industry

 

3.1 Consideration of the impact of greening on competitiveness could perhaps be best made in the wider context of Pillar 1 [1] .

3.2 A degree of impact on food production from greening is inevitable:

o The permanent grassland measure would impact unnecessarily on competitiveness as it would ‘ossify’ land use, limiting the ability of current and future businesses to adapt and respond to the market by ploughing up grasslands of both low and high environmental value and planting crops on land that is well-suited and may have grown them in the past.

o The proposed crop diversity measure may impact on competitiveness as it runs counter to the trend towards block cropping and simplified rotations in response to economic pressures.

o The proposed EFA measure will inevitably lead to some loss of food production. The precise impact will depend on the percentage adopted and the definition of what is eligible (especially the extent to which existing features can count). Evidence suggests that environmental benefits can be delivered in ways that minimise this impact. This could be achieved by supporting additional environmental management requirements for EFA land; for example, the positive management of fallow land, eg by planting and managing a pollen and nectar seed mix. It is less obvious that EFA will impact on the competitiveness of farming except on the most intensive farms on the best land. Precision farming techniques tend to show that for most farms there is a percentage of the land where the cost of the inputs outweighs the return. We feel that there may even be some potential for ‘win-win’ outcomes in this area. For example via certain ‘smart’ implementation models greening could help with soil conservation and securing populations of beneficial insects.

4. Consistency of the greening proposals with the CAP simplification agenda

 

4.1 The addition of greening in Pillar 1 will not make CAP simpler. However, experience from current delivery has demonstrated that delivering environmental benefits effectively is inherently complex so a degree of additional complexity is to be expected. The question is whether the additional complexity of the Commission’s proposals would be justified by improved environmental outcomes. On this point we note the useful guiding principal that is provided in the March 2011 Agriculture Council paper on simplification, which was roundly supported by the UK and around three-quarters of EU Member States, it reads: "An acceptable justification for increased cost might include better targeting of funding towards the provision of public goods, or a reduction in risk to EU funds – providing these benefits exceed the costs of achieving that" [1]

4.2 Agriculture is diverse and complex across the EU and agricultural interaction with the environment adds to that complexity. Establishing simple and standardised approaches across the EU is therefore a real challenge especially in seeking solutions where all farm systems and all environmental circumstances will add real value. The best that can be expected is a foundation on which more complex and targeted management could be delivered.

4.2 Greening proposals would inevitably add to the overall level of complexity. From a delivery body perspective the addition of greening in Pillar 1 is likely to add complexity in the following ways:

o Delivering environmental management through a combination of annual and multi-annual agreements, with the cross-checks necessary to ensure consistency between these.

o Identifying, mapping and measuring EFA features.

o Managing the transition from the current programme.

o Monitoring Pillar 1 and Pillar 2 compliance.

5. How greening pillar 1 can be made coherent with agri-environment schemes

 

5.1 Depending on which greening proposals are agreed, it seems clear that it will be useful to clearly define the interface between agri-environment schemes and greening. If it is possible to design a greening package that delivers the area that is currently delivered by ELS then it will also be possible to design schemes that would provide incentives to positively manage this area for the environmental benefits it can provide. This would restrict the role of Pillar 2 to that of offsetting the costs of additional positive management.

5.2 Natural England has previous experience of using agri-environment options as ‘top-ups’ to pay for additional management on features which have been taken out of production under other measures. ELS was designed to provide a limited range of top-ups on set-aside land, for example, allowing for top-up payments to encourage the use of this land for growing wild bird seed and pollen and nectar mixes.

5.3 We note that various transitional issues could be addressed to maintain existing agreements and phase changeover.

6. Conclusion

6.1 The Commission’s ambition to generate greater environmental outcomes in the CAP, including the ambition to get action across the whole of the farmed environment is backed up by evidence of need. In England, action at this sort of scale is likely to be required if we are to hit the targets set out in the England Biodiversity Strategy ‘ Biodiversity 2020’.

6.2 The current proposals may not be the most efficient or effective way of doing this, either in England or across the EU, as they could lack the important flexibility to target and to tailor eligibility - and are limited by their annual non contractual nature.

6.3 We note that through the current experiences of the Campaign for the Farmed Environment, England could offer some very ‘real time’ practical and pertinent lessons around the potential for environmental delivery in the absence of conditions attached to direct payments.

6.4 The limitations of Pillar 1 funding (annual, non-contractual etc) mean that it is not the ideal mechanism for supporting complex, multi-annual, locally specific environmental management. Experience to date, and the available evidence, suggest that Pillar 2 is likely to be a more effective mechanism to deliver environmental outcomes.

November 2011


[1] Farming and Food a sustainable future (2002) Report of the Policy Commission on the Future of Farming and Food. http://www.cabinet-office.gov.uk/farming

[2] Lawton, J.H., Brotherton, P.N.M., Brown, V.K., Elphick , C., Fitter, A.H., Forshaw, J., Haddow , R.W., Hilborne , S., Leafe , R.N., Mace, G.M., Southgate, M.P., Sutherland, W.J., Tew, T.E., Varley , J., & Wynne, G.R. (2010) Making Space for Nature: a review of England’s wildlife sites and ecological network. Report to Defra.

[3] Biodiversity 2020: A strategy for England’s wildlife and ecosystem services (2011) Defra. http://www.defra.gov.uk/publications/2011/08/19/pb13583-biodiversity-strategy-2020/

[1] National Ecosystem Assessment technical report Ch. 6 http://uknea.unep-wcmc.org/Resources/tabid/82/Default.aspx

[2] Proposal for a regulation of the European Parliament and of the Council on the financing, management and monitoring of the common agricultural policy. Article 93 “In addition, as regards the years 2014 and 2015, the rules on cross compliance shall also comprise the maintenance of permanent grassland. The Member States which were Member of the Union at 1 January 2004 shall ensure that land which was under permanent grassland at the date provided for the area aid applications for 2003 is maintained under permanent grassland within defined limits”.

[3] GWCT (2010). Conserving the Brown Hare . Game & Wildlife Conservation Trust, Fordingbridge .

[4] EU DG ENV Contract 07.0307/2009/S12.541589/ETU/B1 – Biois Final report 2010. Environmental impacts of different crop rotations in the European Union

[5] Bignal , E.M. & McCracken, D.I. ( 2000 ) The nature conservation value of European traditional farming systems. Environmental Reviews 8 149-171.

[6] Pastoral (2003) The nature of European pastoralism . Information Note 3

[7] Set-aside: conservation value in a changing agricultural landscape – Agriculture Ecosystems and Environment have published as a Special Issue ( Vol 143, Issue 1, Sept 2011) Guest Editors Morris & Báldi .

[1] Direct Payments in the CAP Post 2013 (2011) Tangermann , S Department of Agricultural Economics and Rural Development, University of Göttingen , Germany, report for the European Parliament.

[1] Note submitted by the Netherlands and Danish delegations to the Special Committee on Agriculture on 7 March 2011 entitled ‘Simplification of the Common Agricultural Policy beyond 2013 ’, 7206/11, AGRI 181, p.3, http://register.consilium.europa.eu/pdf/en/11/st07/st07206.en11.pdf

Prepared 30th November 2011