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AESI Conference, Dublin, Oct. 2010 Plenary Session: CAP 2013 David Harvey CRE & School of...
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Transcript of AESI Conference, Dublin, Oct. 2010 Plenary Session: CAP 2013 David Harvey CRE & School of...
AESI Conference, Dublin, Oct. 2010
Plenary Session: CAP 2013Plenary Session: CAP 2013
David HarveyCRE & School of Agriculture, Food & Rural Development
AESI Conference, Dublin, Oct. 2010
Plenary Session: CAP 2013Plenary Session: CAP 2013
David HarveyCRE & School of Agriculture, Food & Rural Development
Caveats: Our analysis may be no better than yours
Caveats: Our analysis may be no better than yours
CAP History & Policy DependencyCAP History & Policy Dependency
Source: : EC, DG Ag. & Rural Development, 2009
Strategic Dependency -> CAP origins (early years) Support Dependency -> CAP Persistence (crisis years) Programme Dependency -> CAP Resilience (1992 ff Reforms)
Source: : EC, DG Ag. & Rural Development, 2009
Strategic Dependency -> CAP origins (early years) Support Dependency -> CAP Persistence (crisis years) Programme Dependency -> CAP Resilience (1992 ff Reforms)
CAP Funding HistoryCAP Funding History
Source: : Hanniotis, 2009 Source: : Hanniotis, 2009
CAP Support HistoryCAP Support History
Source: OECDSource: OECD
CAP Reform – the “Consensus”?CAP Reform – the “Consensus”?
Source: HSBC, Forward Planning 2010 Source: HSBC, Forward Planning 2010
CAP Reform – the SFP issueCAP Reform – the SFP issue No academic, independent, or ‘objective’ support for direct
payments Other than as explicitly targeted and conditional payments Very unevenly distributed within and between MS And are already ‘nationalised’ – at least for NMS SFPs are obsolete - phase them out completely.“Unless justification (for the SFP) is fully credible, it will not be politically
sustainable. And if it is not politically sustainable, it will not stick, and then the uncertainty among farmers will persist. But policy uncertainty is just about the worst thing one can inflict on a sector whose health so much depends on long-term planning.” Tangermann, 2010
But How can SFPs be phased out or eliminated?
No academic, independent, or ‘objective’ support for direct payments
Other than as explicitly targeted and conditional payments Very unevenly distributed within and between MS And are already ‘nationalised’ – at least for NMS SFPs are obsolete - phase them out completely.“Unless justification (for the SFP) is fully credible, it will not be politically
sustainable. And if it is not politically sustainable, it will not stick, and then the uncertainty among farmers will persist. But policy uncertainty is just about the worst thing one can inflict on a sector whose health so much depends on long-term planning.” Tangermann, 2010
But How can SFPs be phased out or eliminated?
CAP Reform: Key Distributional IssuesCAP Reform: Key Distributional Issues
CAP Reform Debate: Critical IssuesCAP Reform Debate: Critical Issues
Member state shares could dominate negotiations
Design & Implementation of RD and CARE problematic
‘Simplification’ aspiration endangered
There is no ‘perfect storm’ in prospect for radical reform
CAP Bond - a ‘deal maker’?
CAP Bonds – a way forward?CAP Bonds – a way forward? Elimination of SFPs is Politically impossible
(too many farmers are too dependent on the support)
So, convert the SFP to fixed payments for a fixed term
& convert the fixed payment stream into a Bond
First formally proposed in 1991 (EP, LUFPIG)
echoed in the Buckwell report (1997) of TAA
Failed in 91 (Swinbank & Tranter, 2004) because:
Poor timing & confusing; Lack of coalition building & Commission fears of re-nationalisation and capitalisation of support
CAP Bonds – The Benefits:CAP Bonds – The Benefits: Farmers’ present viability secured
But with added flexibility & fungeability
C.f. uncertain phased reduction – eventual elimination?
+ continued debates & efforts to resist reform
Markets adjust & adapt – revealing needs for, e.g.:
Stabilisation and insurance assistance;
Environmental payments
Ends support dependency, encourages & assists transition and development – what more do you want?
ConclusionsConclusions
Serious negotiations needed about level and distribution of SFPs anyway
But currently hopelessly confused by the (absence of) serious political legitimacy for continued payments
Bonds (fixed level and term of payments) break support & programme dependencies
And provide much needed confidence, capacity and capability for farmers to adapt and adjust to market realities.
The Solution?The Solution?
Thanks for your attention. Comments & Questions?