EU Agricultural policy

The common agricultural policy for the financial period 2014-2020 is based on two pillars. In the first pillar, the European Agricultural Guarantee Fund (EAGF) finances direct payments to farmers and measures to regulate or support agricultural markets (market regulation measures). Direct payments mean a basic premium per eligible hectare. In the second pillar, the European Agricultural Fund for Rural Development (EAFRD) is the EU funding instrument for the economic, social and ecological development of rural areas.

In 2018, the European Commission presented proposals for a common agricultural policy after 2020. These proposals provide for simplification and modernisation of the Common Agricultural Policy in the agricultural sector and in rural development. A new implementation model will allow the EU to set less detailed requirements and carry out fewer controls on farmers. On the other hand, the member states are to be given more flexibility in both pillars and greater climate and environmental protection is to be anchored in agriculture. At EU level, only nine EU-wide economic, environmental and social objectives are to be set. The Member States will set out in their national strategy plans how they intend to achieve these objectives by means of measures under the two pillars.

The CAP after 2020 shall also reinforce environmental and climate protection: 40% of all CAP expenditure is to be contributed to climate protection. In addition, direct payments shall be dependent on the degree of implementation of environmental and climate protection requirements. A voluntary system of "eco-schemes" will be introduced to help farmers go beyond the mandatory requirements. Member States shall also spend at least 30 percent of their rural development funds on environmental and climate protection.