Policies

Rural development policy

Background

Rural areas represent about 80% of EU territory and an important part of its population. The enlargement of the EU will increase the relative importance of rural areas. With its "Agenda 2000" the European Union emphasised the importance of a rural development policy, making it the second pillar of Common Agriculture Policy (CAP). With the CAP reform of June 2003, the EU further strengthened and widened its rural development policy.


I. What does the European Union do

There is wide diversity in rural areas in the EU. Therefore, the rural development measures, introduced by Agenda 2000, are divided in different categories: Investments in farm businesses, human resources (young farmers, early retirement, training), less favoured areas and areas subject to environmental constraints, agri-environmental measures, processing and marketing of agricultural products, forestry and, finally, promoting the adaptation and development of rural areas. Member States can choose those measures which are most adapted to their regions.

Agenda 2000 introduced a system of co-financing by the EU and Member States. The EU contribution is 50%, but can be increased to 75%, depending on the region concerned (Objective I regions, less favoured areas). A further rural development programme is Leader+, concentrating on innovative projects for sustainable development. With the CAP reform in 2003, the EU decided to increase rural development funding, through the so-called "modulation"system. Modulation is a transfer of funds from the first pillar of the CAP (market policy and direct payments) to the second (rural development), with a percentage of ultimately 5% a year. EU funding for rural development for 2000-2006 amounts to 50 billion Euro, with an additional 2 billion Euro for Leader+ projects.

With the 2003 CAP reform, the European Union also introduced new accompanying measures for rural development policy:

• Food Quality: support for farmers who participate in schemes to improve the quality of agricultural products and processing. Support for producer groups to inform consumers and promote quality products;
• Meeting high standards: a digressive aid for farmers by Member States to implement the high EU standards in the field of environment, public health, animal welfare, safety, etc. (the so-called "cross-compliance" criteria);
• Support for farm audits: to help farmers with costs of using farm advisory services;

Moreover, the agri-environment chapter will be reinforced with new animal welfare measures and co-financing would be increased by 10%.


II. What has the EPP-ED Group achieved

The EPP-ED has played an important role in the widening and strengthening of rural development policy. Already with the preparation of Agenda 2000, as well as the 2003 reform package, EPP-ED Members brought forward policies, including aid for young farmers, the simplification of rural development measures and on increase in funding for these measures. Furthermore, the EPP-ED Group has insisted on the application of the subsidiarity principle in this field allowing that Member states to draw up their own rural development programmes, to be approved by the Commission.

To emphasise the importance of an EU rural development policy, European Commissioner Franz Fischler (EPP-ED) organised a Conference on rural development in Salzburg in November 2003. Joseph Daul, EPP-ED Member of the European Parliament and President of the Committee of Agriculture and rural development, presented the conclusions of this Conference. These conclusions contain the main principles to ensure the future of rural development policy:

• A living countryside is in the interests of society as a whole. Therefore, investment in rural economy and communities is vital to increase the attractiveness of rural areas, promote sustainable growth and increase employment. A living countryside is essential for farming and agricultural activity is essential for a living countryside.
• The competitiveness of the farming sector must be a key aim, strengthened through diversification, innovation and value added products. This is important for all rural areas, but particularly for the new Member States, given the significant further agricultural restructuring expected in these countries.
• Rural development policy must serve the needs of the broader society in rural areas and contribute to cohesion. Strengthening the wider rural community will promote sustainable development of rural areas sought by all rural stakeholders.
• A significant simplification of EU rural development policy is both necessary and urgent. Delivery must be based on a programming, financing and control system tailored to the needs of rural development.

III. Our goals for the next legislative period

The EPP-ED Group considers that rural development policy should be strengthened to enrich rural areas and all the people living and working in them. Agriculture is not the only, but certainly an essential part of the rural area. In view of enlargement, the importance of rural area policy will increase. The new Temporary Rural development Instrument (TRDI), with special aid for rural areas in the new Member States for the period 2004-2006, has to be fully utilised.

To ensure viable and socially cohesive rural areas, the second pillar of the CAP needs to be strengthened further and a new comprehensive rural development policy established. The aim is to stimulate multifunctionality, family enterprise and rural industry, thus to promote employment and prevent rural depopulation. Considering the fact that 50 per cent of the rural population is more than 50 years old, the EPP-ED will place special emphasis on the promotion of the entry of young farmers and on the provision of training. Moreover, it is essential to encourage the use of all human potential in rural regions, especially that of women, who play an important role both at farm level and in the development of rural areas.

As of today, 10% of the agricultural budget of the European Union goes to rural development measures. This amount is not sufficient to meet our goals. The cost of the proposed shift to the 2nd pillar is to be borne by means of structural policy measures, rather than by the CAP's 2nd pillar alone. Farmers living under the subsistence level must be granted adequate socio-economic support and a special insurance scheme to protect against animal disease. The implementation of these measures has to be decentralised as much as possible. Parliament must have co-decision on key aspects. More generally, it is necessary to support the introduction of measures to avoid the new cross-compliance regulation leading to a loss of competitiveness with third countries.


A. Bastiaansen, Adviser