Memorandum by the Royal Society for the
Prevention of Cruelty to Animals
OVERVIEW
1. The RSPCA has been advocating reform
of the CAP for two main reasons, notably:
— The lack of synergy between various
parts of the European Union on its direction for animal welfare
standards. Whilst DG Sanco and its predecessors have been encouraging
a move away from intensive agriculture through raising legislative
standards in the sectors of pigs (Directive 2001/88), laying hens
(Directive 1999/74) and calves (Directive 19997/2), DG Agriculture,
in charge of CAP policies, could be said to be encouraging farmers
to proceed in the opposite direction. Pillar I payments ever since
the 2003 agreement as part of the Mid Term Review, are either
not fully de-coupled in all Member States or are based on historical
payments, such as in Wales and Scotland and still have a link
to pre-2005 Pillar I payments.
— The failure of CAP policies to account
for rapid changes in globalisation. Whilst it could be argued
that the 2003 Mid Term Review prepared the European Union well
for any Doha Development Round agreement, by decoupling Pillar
I payments and moving them from the Blue to Green Box, this has
still to be tested at the WTO and there are economists who believe
that they would fail this test.[33]
In other areas the DDA talks have driven EU policy such as the
agreement to phase out export subsidies for live animals.
2. Symptomatic of the lack of agreement
at an EU wide level of long term objectives for the CAP can be
found not in the tortuous negotiations in the Mid Term Review
or even in the almost 50-50 split within the EU on the Commission's
mandate for the agricultural negotiations under the DDA, but in
the failure of the EU-25 in 2004 to agree a new Article 33 under
the negotiations to agree the European Union Constitution. The
CAP still has a mandate to "increase agricultural productivity
by promoting technical progress and the optimum utilisation of
the factors of production". This is despite it being written
50 years ago, and related to a much different European Economic
Community of six Member States 12 years after the end of the Second
World War where European food security was a real and valid issue.
We now have a European Union of 27 countries operating in a global
marketplace and general agreement that the EU cannot, nor should
it be self sufficient in all food sectors. Even the Agriculture
Commissioner is mystified as to why it proves so difficult to
find more modern language for Article 33.[34]
3. The RSPCA believes that the long term
objective of the CAP should be to maximise sustainable management
of the landscape and farm animals to public benefit using the
land productively and taking into account public desires.
4. This would send a clear message to producers
that they are being paid to act as guardians of the landscape
and animals on that land. It also sets the framework that farm
practices and standards should take into account the welfare of
the animal, reflecting that which already exists in some farm
assurance schemes. The CAP would develop away from direct payments
into payments that reward farmers producing higher welfare standards
or managing the environment and landscape in a sustainable manner.
It would mean a move from Pillar I payments (which accounts for
77% of CAP monies at present) into Pillar II payments which reward
good farming and environmental practises. It was Pillar II payments
that came out worst from the European Council agreement in 2005
that saw the agreed budget for the period up to 2013 take a 22%
cut from the Commission's proposed budget, equating to a loss
of some €19 billion over the budgetary period that will now
not be available for rural development issues.
5. The RSPCA agrees with the premise of
the UK Government's paper Vision for the Common Agricultural Policy
that radical change is required to deliver support to farmers
more efficiently and reduce the negative impact on the environment
and animal welfare.
6. A number of important developments are
now occurring. The agreement on the first EU Animal Welfare Strategy
in January 2006 lays down the direction for the EU on animal welfare
in the 2007-13 period. The Commission's Welfare Quality programme
will see objective mechanisms developed to measure on farm welfare
of animals giving direct comparisons between farming methods.
Measurements on animal welfare have also improved. In 2006 Defra
developed through the England Implementation Group (EIG) the first
SMART indicators for farm animal welfare. The RSPCA released their
own farm welfare indicators in 2006 and the Commission is also
set to develop their own goals. This gives a real opportunity
to align the rural development incentives for farmers and producers
with high level strategic goals and ensure goals are built into
programmes to improve the welfare of farm animals.
7. The RSPCA agrees that agriculture should
be a sustainable industry and rewarded for its outputs by the
taxpayer where these are producing societal benefits that cannot
be delivered in the market place. The RSPCA would include animal
welfare in these benefits. However the two goals of producing
high welfare standards and being internationally competitive without
subsidy or protection are incompatible. In some sectors, of which
eggs is the clearest, there is a causal relationship between raising
animal welfare standards and the risk of being undermined by imports
from third countries where standards are at a lower level. This
can cause the industry to become uncompetitive in its own market
place let alone the export market.
8. The objectives laid out in paragraph
4 would allow funding to producers to improve standards for farm
animal welfare and not be disadvantaged from imports from third
countries. These mechanisms already exist in Pillar II but are
being used rarely due to funding starvation and a lack of clarity
for Member States on the future direction of the CAP. The objective
would reinstate a direct link between the public and the CAP,
a link that has been completely lost. It is the European taxpayer
that funds the CAP, although most are completely ignorant of the
fact that nearly half the EU's budget goes into agriculture, which
in the UK accounts for nationally under 1% of GDP and 2% of employment
and even in rural areas 3% in both. The Commission has been a
strong advocate of understanding what the European public think,
undertaking in the past three years alone two Eurobarometers into
animal welfare and one into the CAP. These find that the public
consistently wants better farm standards, better information and
labelling on farm products and more money diverted into rural
development and improving animal welfare standards. These are
not desires limited to northern European countries but include
majorities of the public in countries that are amongst the most
opposed to CAP reform.
9. It is true that as the CAP develops into
these new areas and loses production payments it becomes less
of a common policy and more of rural and social policy. This reflects
the vastly different landscapes, climates and farming methods
in the EU-27. Payments will become more varied both within and
between Member States. The present position with Pillar I payments
reflects this with at least five different funding mechanisms
being adopted in the EU. Pillar II payments are also likewise
being highly varied. The Commission is expecting 94 different
rural development programmes to be adopted by the 27 Member States
for the 2007-13 period giving a huge potential for varied funding
and varied goals and targets. If monies are transferred at a greater
rate from Pillar I to II the potential for increased financial
variation will be vastly different to the present position and
the only common theme of the Common Agricultural Policy will be
the objectives as laid out in Article 33, which are outdated.
10. The RSPCA consider that the main pressures
on the CAP will be from external drivers. Climate change will
require farmers to change farming practices and also react to
different needs of the EU such as biofuels. Globalisation, with
or without a DDA agreement will see pressure for reduced tariffs,
decoupled payments and a need to reward farmers for producing
to higher welfare standards and therefore remaining competitive.
There will be an increased desire from the public to be better
informed on the food they are buying, leading to more mandatory
labelling from the egg sector into other sectors such as pork,
beef, dairy and poultrymeat. The enlargement of the EU from 27
to possibly 30 countries in the next few years and any membership
of Turkey will require a massive budgetary change in the way EU
funds are directed and the composition and direction of CAP funds.
THE REFORMED
CAP
11. The agreement in 2005 to decouple Pillar
I payments was a positive step as it broke the link with production
but it was only a partial success as full decoupling did not occur.
Mandatory decoupling should be completed as part of the Health
Check.
12. New rural assistance measures were agreed
by the EU in June 2005 under Regulation 1698/2005. This allocated
seven new animal welfare measures for inclusion in the RDPs (six
in Axis 1: membership of food quality schemes, food quality promotion,
training, farm advisory, investment agricultural holdings, meeting
Community animal welfare standards; one in Axis 2: payment for
higher standards).
13. However two problems remained. Member
States were not obliged to include any of the animal welfare measures
in their RDP, although this was originally proposed by the Commission.
This has meant that there has not been a large take up of the
animal welfare measures. In the period 2003-05 Scotland, France
and Germany have schemes that were directly aimed at or had side
effects that benefited animal welfare. Secondly, the agreement
on Regulation 1698/2005 allocated minimum financial spend in each
of the four Axes but it is likely that many Member States will
allocate the majority of their funding to Axis 2, which contains
the environmental measures but only one of the seven animal welfare
ones. Certainly the English RDP will follow this pattern and is
proposing to spend 84% of Pillar II budget on Axis 2 measures.
To date only Finland, Ireland, Italy (Emilia-Romania and Toscana),
and two German Länders have submitted schemes that are directly
aimed at improving animal welfare under Axis 2.
14. The lack of clear definitions in the
animal welfare schemes in Regulation 1998/2005 has hampered the
original aim to raise animal welfare standards. For instance,
payments can be given under Pillar II for membership of assurance
schemes, despite the fact these may only be delivering baseline
standards. The RSPCA argued that these should be limited only
to schemes such as Freedom Food which is recognised by the EU
funded welfare quality project as the only dedicated assurance
scheme for farm animal welfare in Europe, and which aims to deliver
standards above the legal minimum. Also, payments are allowed
under Axis 2 for farmers producing at standards that go beyond
mandatory legal EU or national standards. The payments will cover
additional costs and income foregone and are for a period of 5-7
years. The RSPCA called for a definition of "beyond mandatory
standards" as it farmers could be paid for up to seven years
for farming at just above minimum standards.
15. This fear has been proved correct. The
Commission has to date given negative advice on the RDPs of two
Member States as their proposed standards were not high enough.
The RSPCA would prefer to see a stricter definition of these issues
as part of the Health Check, and has produced their own guidelines
for the Commission. Producing clear European standards of what
constitutes farming beyond minimum standards would not only improve
transparency, it would give clearer harmonisation between Member
States and act as a clear standard for any proposed labelling
on farm products.
16. Regulation 1998/2005 also brought in
cross-compliance measures for the first time for three animal
welfare laws. Again it is too early to tell the effectiveness
of this improvement as cross compliance was only introduced in
January 2007. However it is worrying that some Member States are
already proposing cutting back on cross compliance measures that
have been in place for longer under the Health Check. These calls
should be resisted.
THE SINGLE
PAYMENT SCHEME
17. The RSPCA advocates a vastly enlarged
rural development scheme and sees the transfer of payments from
Pillar I to Pillar II to be an essential step in this development.
It is true that the Single Farm Payment (SFP) scheme is an improvement
on the previous myriad of payments as it simplifies the CAP and
carries on the reform programme of moving away from production
payments and quotas. The final pieces of this jigsaw such as removal
of milk quotas should also be completed at the end of the present
budget period.
18. However the EU is now paying farmers
under the SFP but with no real definition as to why it is paying
them. As this represents 77% of CAP payments, it is essential
that Member States agree what the payment is for. Whether it is
a reward for managing the landscape, environment and animals or
is a social payment, it is much better represented under Pillar
II where there are definitive goals and targets. The long-term
plan should be for farmers to get paid for managing the environment
and its animals and incentivised to go further than baseline standards.
MARKET MECHANISMS
19. The RSPCA supports the removal of quotas,
although in the dairy industry more economic scoping needs to
be done on any effects on increased animal/stockperson ratio and
increased production. Both could be negative for animal welfare.
We support the phase out of export subsides under the DDA and
see this as being done by 2013 for all subsidies and by 2010 for
live animal subsidies. The Commission has tried in the past to
ensure that export subsidies are only paid to farmers that have
abided by European standards on live transport and slaughter.
But this has proven impossible to enforce as some of the journey(s)
and the slaughter of the animal often occurs in another sovereign
state. As only three countries get export subsides for the live
export of cattle, eliminating this measure would not be financially
burdensome but give a clear signal that the EU is moving to a
different type of CAP.
RURAL DEVELOPMENT
20. As detailed in paragraphs 15, 16 and
17, the RSPCA sees the Rural Development Fund as being the most
important area for the future of the CAP. The Mid Term Reform
in 2004 saw great opportunities for improving the welfare of animals
under the EAFRD but there are limits to how its use can be maximised.
This needs to be rectified under the CAP Health Check in 2008.
21. Animal welfare measures are not compulsory
and suffer from a lack of objective definitions where they are
mentioned. The lack of funding has resulted in few measures being
proposed by Member States under Axis 2, where the majority of
budget is to be allocated.
22. It is true that many more measures are
being proposed under national RDPS under Axis I with the intention
of improving animal welfare. In the period 2003-05 Scotland, France
and Germany had schemes that were directly aimed at or had side
effects that benefited animal welfare. The Scottish RDP 2007-13
has three budget lines for encouraging animal welfare including
membership of an assurance scheme, completing a Veterinary Health
Plan and for training purposes. The response on the animal welfare
measures in Scotland in 2005 was extremely positive, the second
most popular of all incentives given under the SRDP. The 2003-7
Welsh RDP had measures to encourage animal welfare and the proposed
2007-13 WRDP gives incentives for farmers entering into agreements
committing to higher welfare standards than baseline ones under
the agri-environment scheme. In Germany the present RDP provides
incentives of grants for investment costs in nine sectors providing
certain higher welfare standards are met.
23. More Member States including those from
the 10 new members have proposed further schemes under Axis 1.
But all schemes will inevitably suffer from lack of funding and
it is difficult to forecast the degree of success they will have
in promoting better farm welfare due to this limitation.
24. The 94 expected RDP schemes show that
any harmonisation between plans amongst the EU-27 will be difficult.
The introduction of better measurement indicators for animal welfare
should facilitate the capture of data to show the effectiveness
of schemes in achieving their objectives of improving farm welfare.
But the measurement of outcomes against schemes is not specifically
mentioned in the EAFRD. The opportunities afforded by the many
schemes and any assessment of the effectiveness of certain schemes
against others may then be unfortunately lost. This will mean
that any analysis work undertaken by the Commission in the period
leading up to the end of the current RDP in 2013 will be difficult
and assessments on improvements and best schemes to take forward
in the next budget period frustratingly elusive.
25. Until there is a clearer direction for
the CAP, the RSPCA recommends using compulsory modulation to achieve
the transfer of funds from Pillar I to II. This could best be
achieved through compulsory modulation in the CAP Health Check,
but until this time, the RSPCA supports the use of voluntary modulation.
WORLD TRADE
26. If tariffs are reduced in certain sectors,
such as eggs (particularly dried eggs) there is a risk of European
farmers being undermined by imports from third countries where
standards are at a lower level. The Rural Development Programmes
could play an important role in filling this gap and reward farmers
for producing at standards above baseline. Indeed it could be
argued that the Single Farm Payment, which is now given for the
farm rather than the sector, has opened up the CAP to include
sectors previously not covered by payments and obligations such
as the laying hens and pigs sectors. Mixed farms with these animals
that also receive CAP Pillar I payments would have to meet cross
compliance measures for all animals and could also be eligible
for payments such as ones paying one-off capitol costs or improvements
to competitiveness.
27. Some consequences of raising farm standards
have already been modelled. In the egg sector, there will be an
economic cost of raising welfare standards under Directive 1999/74
that is 9p/dozen eggs moving to a multi-tier system or 18p/dozen
eggs moving to a free range system.[35]
The main exporting countries hold a competitive advantage in dried
eggs before any changes in the DDA occur. Switzerland provides
an interesting case study. Following the prohibition of battery
cages in 1991 Swiss egg producers were rewarded through rural
payment programmes for producing above baseline standards. This
coupled with an aggressive marketing campaign to buy Swiss eggs
has resulted in a vibrant Swiss egg sector that has not been disadvantaged,
despite it being surrounded by countries using lower standards.
FINANCING
28. The problem with the financing of the
CAP has already been mentioned. This is particularly relevant
for the UK, which has historically received a much smaller allocation
of rural development funds (some 3.5%) than other Member States.
The Government intention to modulate up to 20% releases further
monies that would not otherwise be available but it underlines
the need within the Health Check to begin the discussion on a
new financial division of CAP funds, both between Pillars I and
II and between the Member States. The RSPCA would see this including
a start at reducing the separation of funds between Pillars I
and II with the eventual allocation of the majority of funding
into a Rural Development Pillar II type fund.
29. The UK already has a number of targets
that could be set or financed from Pillar II payments, either
in the form of PSAs or encapsulated in existing strategies such
as the Animal Health and Welfare Strategy. The RSPCA is not aware
of any financial modelling and predictions that have been run
by the UK Government on the cost implications of meeting these
targets, and how this matches to present Pillar II funding. The
lack of prioritisation with these targets has meant a skewering
of the level playing field of division of funding from the Rural
Development Programme in the England. For instance Natural England
has a PSA target of getting 95% of SSSIs into a favourable or
recovering state by 2010, much of which would be expected to be
funded from Pillar II payments. It therefore lobbies Defra for
schemes to meet this target from the RDP. This obviously reduces
the amount of money that is available for other schemes such as
improving animal welfare. The RSPCA believes that the Government
could have competing targets and strategies already in existence
that have yet to be or cannot be costed. These are competing against
each other for a pot of money that is not likely to get any bigger
until at least new negotiations start on the post 2013 budget.
It is essential to have these prioritised.
SIMPLIFICATION OF
THE CAP
30. The CAP has been simplified over previous
reforms. There should be a long term objective to simplify payments
into one rural development scheme but with flexibility to allow
Member States options on choosing which of the budget lines they
wish to use, depending on their own national interests and landscape.
This could be set as part of the Health Check and phased in by
2013, so giving farmers the stability they ask for but a direction
in which they are required to hear. For this to occur there needs
to be a European agreement on what the CAP is for either in a
set of guiding principles or, as part of the renegotiations on
the Constitution, to agree a revision of Article 33. However at
present there does not appear to be the appetite for such discussions
let alone agreement.
31. Pillar I, could be simplified further
in the Health Check by agreeing one system for payments. In the
absence of this, the CAP will continue to be reformed in a piece
meal manner, responding to outside pressures such as WTO demands
and globalisation rather than setting the agenda itself. It has
started to progress along a route to being a Rural Policy but
needs greater clarity to provide a rural programme that can respond
to new pressures such as climate change and changing consumer
demands.
June 2007
33 Swinbank A & Tranter R. 2005 Decoupling EU farm
support : does the new single payment scheme fit within the
Green Box? Back
34
EFRA 4th report of session 2006-07 The UK Government's vision
for the Common Agricultural Policy EV89 Q 248. Back
35
RSPCA Hard Boiled Reality 2005; RSPCA Ecomomic consequences
of egg production 2005. Back
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