cap and rural development policy in the eu and slovak republic imrd, nitra july 15, 2014

CAP and Rural Development Policy in the

EU and Slovak republic

IMRD, Nitra

July 15, 2014

2

Content

EU budget CAP

Market regulation Rural development policy

Rural development policy in EU Regulation 1290/2005, 1698/2005 Community strategic guidelines for rural development

policy of EU

Implementation of rural development policy in SR Rural development programme of Slovak republic for

2007-2013

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History of EU budget

Introduction of european budget is connected to establishment of ECSC (system of own resources)

1st model – contribution to the budget France, Germany, Italy – 28%, Netherlands, Belgium – 7,9%, Luxembourg – 0,2%

1970 – 1st Budget Treaty – 3 incomes of the budget

Tariffs from imports from 3rd countries, Duties on agricultural imports from 3rd countries and

sugar and izoglucose, 1 % of VAT

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History of EU budget

1975 – 2nd Budget Treaty, strenghtening of Parliament position – possibility of refusing the budget as whole

1 % of VAT up to year 1986 1,4% of VAT from the year 1986 (1988) - introduced 4th source of financing – GNI

Sources of EU budget 1988/2013

COMMON AGRICULTURAL POLICY

CAP

The EU's common policy is one of the oldest policies

Budget of the policy is close to 44% of the total EU budget

ACTORS ACQUIS OBJECTS

OBJECTIVES

PRINCIPLES INSTRUMENTS FUNDS

OBJECTIVES

to increase productivity, by promoting technical progress and ensuring the optimum use of the factors of production, in particular labour;

to ensure a fair standard of living for the agricultural Community;

to stabilise markets; to secure availability of supplies; to provide consumers with food at reasonable

prices.

ACQUIS

PRIMARY LEGAL SOURCES OF CAPSECONDARY LEGAL SOURCESTERTIARY LEGAL SOURCES

ACTORS OF CAP

EUROPEAN PARLIAMENT - AGRICULTURAL COMMITTEES

EU COUNCIL - COUNCIL OF MINISTERS OF AGRICULTURE OF MEMBER STATES

EU COMMISSION - DG AGRI SCA - SPECIAL COMMITTEE ON AGRICULTURE COMMITTEE OF THE REGIONS, ETC.

ACTORS OF CAP - SR

MANAGING AUTHORITY PAYING AGENCY/INTERVENTION OFFICE COORDINATION OFFICE CERTIFICATION / AUDIT AUTHORITY AUTHORITY OF TRANSFERS

OBJECTS OF CAP

individual farmers,business companies,others

carrying out the activities under the Regulation 1290/2005, 1698/2005

COUNTRIES OF IMPLEMENTATIONOF CAP

1958 (6) – 2007 (28)

1958: FR, DE, IT, NL, BE, LX 1973: DK, IRL, UK 1981: GR 1986: ES, PT 1995: AU, FI, SE 2004: CZ, H, PL, SK, SLO, EST, LAT, LTV, CYP, MT 2007: BG, R 2013: CR

PRINCIPLES OF CAP

Single market Preference of EC Financial solidarity

INSTRUMENTS OF CAP

CAP MARKET SUPPORT MEASURES direct subsidies to producers or

processors (SFP, SAPS, ADP), intervention purchase, quantitative quotas, protection of common borders

FUNDS OF CAP

EUROPEAN AGRICULTURAL GUARANTEE FUND (EAGF) – 1st pillar

EUROPEAN AGRICULTURAL FUND FOR RURAL DEVELOPMENT (EAFRD) – 2nd pillar

CAP REFORMS

REFORM ADRIENSEN (1984)

milk quotas to limit and control production quota represented the ownership of individual

member states overspend was penalized by the financial

sanctions amounting to 115% of the indicative price of milk

MAC-SHARRY REFORM (1992)

direct payments to farmers - to compensate the reduction in prices of agricultural products

paid per hectare of agricultural land or animal reductions in intervention prices - a gradual

increase in rates of direct payments set asside incentives to encourage retirement of farmers over

55 years to take early retirement

AGENDA 2000 (1999)

Intervention price for cereals fell by 15 percent with the distribution of cuts in two years

reduction in intervention prices for beef by 20 percent is spread over a period of three years

Significant changes in the agri-environment support and support for rural development (2nd pillar of CAP)

LUXEMBOURG REFORM (2003)

Single farm payment Cancellation of coupled support for

agricultural production (decoupling) Cross Compliance Set aside Modulation Rural Development Farm advisory system

RURAL DEVELOPMENT POLICY

Council Regulation (EC) 1290/2005 on the financing of the CAP

This Regulation sets specific requirements and rules on the financing of expenditure falling under the common agricultural policy, including expenditure on rural development

Funds financing agricultural expenditure: European Agricultural Guarantee Fund (EAGF), European Agricultural Fund for Rural

Development (EAFRD)

Council Regulation (EC) 1698/2005 Aims of rural development policy

Support for rural development shall contribute to achieving the following objectives:improving the competitiveness of agriculture and forestry by supporting restructuring, development and innovation,improving the environment and the countryside by supporting land management;improving the quality of life in rural areas and encouraging diversification of economic activity

STRATEGIC PLANNING OF RURAL DEVELOPMENT

EU STRATEGIC GUIDELINES FOR RURAL DEVELOPMENT

EC adopted the Community strategic guidelines for rural development policy for the programming period from 1 January 2007 to 31 December 2013

Strategic guidelines establishing strategic priorities for rural development at Community level for the programming period

NATIONAL STRATEGIC PLAN

Each Member State shall submit the National Strategic Plan, setting out priorities for action of the EAFRD and the Member State taking into account the strategic guidelines, their specific objectives, the contribution from the EAFRD and other financial resources

National Strategic Plan is a reference tool for preparing EAFRD programming and is implemented through „Programs for rural development“

NATIONAL STRATEGIC PLAN

National strategic plan includes: assessment of the economic, social and

environmental situation and development potential

strategy chosen for joint action showing the consistency of the choices and the Community strategic guidelines

thematic and territorial priorities for rural development under each axis, including the main quantified objectives and appropriate indicators for monitoring and evaluation

NATIONAL STRATEGIC PLAN list of rural development programs sources to ensure coordination with other common

agricultural policy instruments, ERDF, ESF, Cohesion Fund, Community support instrument for fisheries and EIB

description of the arrangements and the indication of the amount dedicated for establishing the National network for rural development

RURAL DEVELOPMENT PROGRAMMES

These programs implement a rural development strategy through a series of measures, grouped in accordance with the axes

Each rural development program covering the period between 1 January 2007 and 31 December 2013

Member State may submit either a single program for its entire territory or a set of regional programs

RURAL DEVELOPMENT PROGRAMMESEach rural development programme shall include:

an analysis of the situation in terms of strengths and weaknesses, the strategy chosen to meet them and the ex ante evaluation;

a justification of the priorities chosen having regard to the Community strategic guidelines and the national strategy plan, as well as the expected impact according to the ex ante evaluation;

information on the axes and measures proposed for each axis and their description, including the specific verifiable objectives and indicators.

a financing plan

RURAL DEVELOPMENT PROGRAMMES an indicative breakdown of the initial amounts by

measure in terms of public and private expenditure;

a table on additional national financing per axis; information on the complementarity with the

measures financed by the other common agricultural policy instruments, through cohesion policy as well as by the Community support instrument for fisheries;

RURAL DEVELOPMENT PROGRAMMES programme implementing arrangements, the designation of the partners and the results of

the consultations of the partners.

RURAL DEVELOPMENT SUPPORT

AXIS 1

IMPROVING THE COMPETITIVENESS OF THEAGRICULTURAL AND FORESTRY SECTOR

MEASURES

measures aimed at promoting knowledge and improving human potential through: vocational training and information actions; use of advisory services by farmers and forest

holders; setting up of farm management, farm relief and

farm advisory services, as well as of forestry advisory services;

setting up of young farmers; early retirement of farmers and farm workers;

MEASURES

measures aimed at restructuring and developing physical potential and promoting innovation through: modernisation of agricultural holdings; improving the economic value of forests; adding value to agricultural and forestry products; cooperation for development of new products,

processes and technologies in the agriculture and food sector and in the forestry sector;

MEASURES improving and developing infrastructure related to

the development and adaptation of agriculture and forestry;

restoring agricultural production potential damaged by natural disasters and introducing appropriate prevention actions;

MEASURES

measures aimed at improving the quality of agricultural production and products by: helping farmers to adapt to demanding standards

based on Community legislation; supporting producer groups for information and

promotion activities for products under food quality schemes;


AXIS 2IMPROVING THE ENVIRONMENT AND THE COUNTRYSIDE

MEASURES

measures targeting the sustainable use of agricultural land through: natural handicap payments to farmers in

mountain areas; payments to farmers in areas with handicaps,

other than mountain areas; Natura 2000 payments; agri-environment payments; animal welfare payments;

MEASURES

measures targeting the sustainable use of forestry land through: first afforestation of agricultural land; first establishment of agroforestry systems on

agricultural land; first afforestation of non-agricultural land; Natura 2000 payments; forest-environment payments; restoring forestry potential and introducing

prevention actions;


AXIS 3THE QUALITY OF LIFE IN RURAL AREAS ANDDIVERSIFICATION OF THE RURAL ECONOMY

MEASURES

measures to diversify the rural economy, comprising: diversification into non-agricultural activities, support for the creation and development of

microenterprises with a view to promoting entrepreneurship and developing the economic fabric,

encouragement of tourism activities;

MEASURES

measures to improve the quality of life in the rural areas, comprising: basic services for the economy and rural population, village renewal and development, conservation and upgrading of the rural heritage;

a training and information measure for economic actors operating in the fields covered by axis 3;


AXIS 4LEADER

ELEMENTS OF LEADER PROGRAMME

Leader approach shall comprise at least the following elements: area-based local development strategies intended

for well-identified subregional rural territories; local public-private partnerships; bottom-up approach with a decision-making power

for local action groups concerning the elaboration and implementation of local development strategies;


multi-sectoral design and implementation of the strategy based on the interaction between actors and projects of different sectors of the local economy;

implementation of innovative approaches; implementation of cooperation projects; networking of local partnerships.


support granted under the Leader axis shall be for: implementing local development strategies, with a

view to achieving the objectives of one or more of the three other axes;

implementing cooperation projects involving the objectives selected under point;

running the local action group, acquiring skills and animating the territory.

FINANCING OF OPERATIONS

FUND CONTRIBUTION

The EAFRD contribution rate shall be established for each axis

In the case of axis 1 (competitiveness) and axis 3 (diversification and quality of life) as well as for the technical assistance following ceilings shall apply respectively: 75 % of the eligible public expenditure in the regions

eligible under the Convergence Objective; 50 % of the eligible public expenditure in the other

regions.

FUND CONTRIBUTION

In the case of axis 2 (improving the environment and the countryside) and axis 4 (Leader) the following ceilings shall apply respectively: 80 % of the eligible public expenditure in the

regions eligible under the Convergence Objective;

55 % of the eligible public expenditure in the other regions.

The minimum EAFRD contribution rate at axis level shall be 20 %.

NON ELIGIBLE COSTS

The following costs are not eligible for EAFRD contribution:

VAT, except non-recoverable VAT, interest on debt, the purchase of land costing more than 10 %

of all the eligible expenditure on the operation concerned.

RURAL DEVELOPMENT PROGRAMME OF SLOVAK REPUBLIC

AXIS 1: IMPROVING THE COMPETITIVENESS OF THE AGRICULTURAL AND FORESTRY SECTOR

Modernisation of agricultural holdings Adding value to agricultural and forestry

products Infrastructure related to the development and

adaptation of agriculture and forestry Improving the economic value of forests Producer groups Vocational training and information actions Use of advisory services

Axis 1 Modernization of agricultural holdings

Construction, reconstruction and modernization of farm buildings

Procurement and modernization of technical and technological equipment

Establishment of fast-growing woody species


Maximum aid intensity from total eligible costs (Convergence objective):

60 % (45 % EU and 15 % SR) for young farmers in less favoured areas;

50 % (37.5 % EU and 12.5 % SR) for others in less favoured;

50 % (37.5 % EU and 12.5 % SR) for young farmers in other areas;

40 % (30 % EU a 10 % SR) for others


Maximum aid intensity from total eligible costs:

(other areas): 60 % (30 % EU and 30 % SR) for young

farmers in less favoured areas; 50 % (25 % EU and 25 % SR) for others in

less favoured areas; 50 % (25 % EU and 25 % SR) for young

farmers in other areas; 40 % (20 % EU and 20 % SR) for others

Axis 1 Adding value to agricultural and forestry products

Construction, reconstruction and modernization of hygiene and sanitary facilities,

Construction, reconstruction and modernization of technology designed to protect the environment,

Construction, procurement and reconstruction of equipment and technology used in the processing of items for the production of food goods with a protected designation of origin, protected geographical indication or guaranteed traditional specialities

Improving the presentation and preparation of products, encouraging better use or elimination of by-products or waste,


Procurement of computer hardware and software, and other electronic equipment, creation of internet connection

Construction, reconstruction and modernization of production buildings, supply depots, storages and exploitation of renewable sources of energy,

Construction, reconstruction and modernization of production rooms and halls including access communications; reconstruction and modernization of machines and technology for primary processing of wood as a raw material, and processing of non-wood forestry products and for processing and exploitation of renewable sources of energy, machinery and facilities for production of biomass.


Maximum aid intensity from total eligible costs: 50 % (37.5 % EU, 12.5 % SR) for areas

covered by the Convergence objective; 40 % (20 % EU, 20 % SR) for other areas.

Axis 1 Infrastructure related to the development and adaptation of agriculture and forestry

Objective

To prepare and carry out projects of land consolidation for new spatial and functional organization of land and to establish social facilities and measures gradually within the projects planned through:

Providing access to plots through reconstruction or building of access roads/paths;

Ecological stabilizing and protecting land through implementation of hydro-economic, anti-erosion, ecological and re-cultivation measures;

Settling proprietary relations to land (through integration and delimitation of plots of land and land ownership).

Maximum aid intensity from total eligible costs: 100 % (75 % EU a 25 % SR) in the Convergence

objective regions; 100 % (50 % EU a 50 % SR) in other areas.

Axis 1 Infrastructure related to the development and adaptation of agriculture and forestry

Axis 1 Improvement of the economic value of forests

Acquisition of machinery and equipment for forest renewal, fostering and handling of young forest vegetation, tree-felling, centralisation, handling, shipping and transport of wood,

Acquisition of special machines for the repair of forest roads;

Construction, completion of already started construction and reconstruction of other facilities directly serving forestry operations (e.g. storehouses for forest reproduction materials, handling-dispatching storehouses, buildings and facilities for handling dispatching storehouses);

Procurement of computer hardware and software

Axis 1 Improvement of the economic value of forests

Maximum aid intensity from total eligible costs: 50% (37.5 % EU a 12.5 % SR) in Convergence objective

areas, 50 % (25 % EU a 25 % SR) in other areas.

Axis 1Producers groups

Objective

To support the setting up, formation and easing of administrative operations for producer groups through:

Adapting the production and output of producers which are the members of such groups to market requirements;

Joint placing of goods on the market including preparation for sale, centralisation of sales and supply to bulk buyers;

Increasing added value of common production and improve its appraisal;

Establishing common rules on production information with particular regard to harvesting and availability.


Animal or plant commodities milk potatoes beef cattle cereals pigs for slaughter oil seeds and pulses poultry and eggs hops sheep grape must goats herbal, aromatic and spice plants bees products Small fruits


Maximum aid intensity: 100 % (75 % EU a 25 % SR) for areas covered by the

Convergence objective; 100 % (50 % EU a 50 % SR) for other areas.

Amount of flat-rate payment Support is granted in annual instalments for the first five

years following the date on which the producer group was recognized. It shall be calculated on the basis of the group′s annual marketed production and does not exceed:

In the first year 5 %, in the second year 5 %, in the third year 4 %, in the fourth year 3 % and in the fifth year 2% of the marketed production up to 1 mil. € and;


In the first year 2.5 %, in the second year 2.5 %, in the third year 2.0 %, in the fourth year 1.5 % and in the fifth year 1.5 % of the marketed production exceeding 1 mil. €.

In no case may the level of support exceed: 100 000 € in the first year, 100 000 € in the second year, 80 000 € in the third year, 60 000 € in the fourth year, 50 000 € in the fifth year.

Axis 1 Vocational training and information activities

All forms of further education whose aims are in accordance with the goals of the measure and with relevant EU legal provisions.

Relevant forms of information activities with current contents and contributions for practice according to applicable legislation in Slovakia

Axis 1 Vocational training and information activities

Maximum aid intensity from total eligible costs: 100 % for areas covered by the Convergence objective (75

% EU and 25 % SR); 100 % for other areas (50 % EU and 50 % SR).

Axis 1 Use of advisory services

To allow agricultural and forestry enterprises to improve management of their enterprises in the environmental sense of the word

The purpose of farm advisory is not the introduction of new norms but as with the case of the audit, to facilitate individual assessment of the correctness of a business’s management, particularly in this case with regard to statutory management requirements and good agricultural and environmental conditions (GAEC)

Axis 1 Use of advisory services

Maximum aid intensity from total eligible costs: 80 % (60 % EU and 20 % SR) in the Convergence

objective regions, a maximum however of 1500 €, 80 % (40 % EU and 40 % SR) in other areas, a

maximum however of 1500 €.

Axis 2 Improving the environment and the countryside

Measures targeting the sustainable use of agricultural land:Natural handicap payments in mountain areas and payments in other areas with handicaps,Natura 2000 payments and payments linked to Directive 2000/60/EC 111Agri-environmental paymentsAnimal welfare payment

Axis 2 Improving the environment and the countryside

Measures targeting the sustainable use of forestry land:

First afforestation of agricultural land Natura 2000 payments – forestry land Forest-environment payments Restoring forestry potential and introducing

prevention actions

Axis 2 Handicap payments in mountain areas and payments in other areas with handicaps

mountain areas; other less favoured areas; areas with specific handicaps.

Axis 2 Handicap payments in mountain areas and payments in other areas with handicaps

Axis 2: NATURA 2000 payments

Geographic allocationThe measure shall be applied horizontally and

implemented within the territories of permanent grasslands with the 4th and 5th level of protection, which were approved and designated as NATURA 2000 areas according to Slovak law

Axis 2: Agroenvironmental payments

Environmentally friendly farming methods Basic scheme Integrated production Organic Farming

Soil protecting measures Protection against erosion on arable lands Protection against erosion in vineyards Protection against erosion in orchards Grassing of arable land

Axis 2: Agroenvironmental payments

Conservation of biodiversity Protection of biotopes of semi-natural and

natural grassland Protection of selected bird species biotopes Breeding and preserving of endangered

animal species

Axis 2: Measures targeting the sustainable use of forestry land

First afforestation of agricultural landThe support is provided to cover: Costs for afforestation of land Annual bonus per hectare of afforested land

as a contribution to cover costs for its maintenance during the period of 5 years,

Annual bonus per hectare as a contribution to cover loss of incomes due to afforestation during the period of 15 years

Axis 2: Measures targeting the sustainable use of forestry land

Axis 3: The quality of life in rural areas and diversification of the rural economy

Diversification into non-agricultural activities Encouragement of rural tourism activities Training and information Village renewal and development,

development of amenities and services Skill acquisition, animation and

implementation of local development strategies

Axis 3: Diversification into non-agricultural activities

Construction, re-construction and modernisation of recreational and accommodation facilities with a capacity 11 - 40 beds – construction investments, investments in interior furnishings, equipment and technologies including creation of internet access;

Re-construction of existing agricultural facilities (no longer serving their original purpose) to agri-tourism facilities with a capacity 11 - 40 beds – construction investments,

investments in interior furnishings, equipment and technologies including creation of internet access;


Construction, reconstruction and modernisation of production and sales facilities and purchase of machinery, technologies and equipment for: Complementary production of non-agricultural nature

including utilisation of renewable energy sources, establishment and the use of the geo-thermal well including distribution with the exception of wind, hydraulic and solar energy on the provision that the final beneficiary does not spend most of the energy produced in its own enterprise;

Production and processing of traditional materials and products


Construction, reconstruction and modernisation of agri-tourism facilities including sanitary, environmental and re-condition facilities in order to promote tourism activities (e.g. indoor pools, fitness centres, massage and solar facilities, sanitary facilities, waste water treatment systems);

Construction, reconstruction and modernisation of premises designed to promote holiday and leisure activities (tourist paths, horseback riding, fishing, hunting, rafting, biking, water sports, winter sports, sauna, pool, playground for kids etc.)


Maximum aid intensity from total eligible costs: 50 % (37.5 % EU, 12.5 % SR) for the

Convergence objective regions, 20 % (10 % EU, 10 % SR) for other regions

Axis 3: Encouragement of rural tourism activities

Part A Reconstruction and modernisation of low

capacity accommodation facilities Re-building of sections of family houses and

other idle property to low capacity accommodation;

Extensions of family houses and other idle property to low capacity accommodation facilities;


Part A Construction, reconstruction and

modernisation of camping type; Construction, reconstruction or modernization

of supplementary relaxation facilities (sauna, hearth, swimming-pools etc.).

Part B Marketing of rural tourism services.


Maximum aid intensity for Part A: 50 % (37.5 % EU, 12.5 % SR) for the

Convergence objective regions; 30 % (15 % EU, 15 % SR) for other regions.

Maximum aid intensity for Part B: 100 % (75 % EU, 25 % SR) for the

Convergence objective regions; 100 % (50 % EU, 50 % SR) for other regions

Axis 3: Training and information

Objective – to develop and promote human resources as an essential prerequisite to improving the quality of life in rural areas;

Eligible activities:all forms of further traininginformation activities

Axis 3: The group of measures: village renewal and development, developmentof amenities and services

Basic services for rural population Reconstruction and modernisation of local

infrastructure; Reconstruction and modernisation of buildings

and facilities of social importance; Investments in premises supporting leisure

activities.

Final beneficiary Municipalities not covered by the growth poles

except an agreed number of settlements with Roma population to be addressed under Regional Operational Programme.


100 % (75 % EU, 25 % SR)


Village renewal and development Construction, reconstruction and modernisation

of water supply and sewage systems; Construction, reconstruction and modernisation

of local roads, foot-bridges, bridges; Construction, reconstruction and modernisation

of pavements, bike routes, public lighting, public spaces and parks.


Final beneficiary Municipalities not covered by the growth poles

except an agreed number of settlements with Roma population to be addressed under Regional Operational Programme.


100 % (75 % EU, 25 % SR)


Axis 3: Skills acquisition, animation and implementation of integrated local development strategies

Scope and actions Development of economic and social

development programmes of municipalities; Elaboration of integrated local development

strategies in accordance with the binding scheme of the Leader approach integrated local development strategy (activation of citizens, mapping of the area, acquisition of data, studies, supporting documents, analyses, proposal and implementation parts);

Axis 3: Skills acquisition, animation and implementation ofintegratead local development strategies

Measures aimed at providing information on the area concerned and integrated local development strategies (printing and distributing strategies, information letters on the area concerned claiming EAFRD aid);

Training for employees of public/private partnerships involved in designing integrated local development strategies;

Promotional events and training of leaders of public/private partnerships related to the preparation for the Leader approach

Axis 3: Skills acquisition, animation and implementation ofintegratead local development strategies

Final beneficiary Public/private partnerships represented by the

civil associations.

Aid intensities

Maximum aid intensity from total eligible costs: 100 % (75 % EU, 25 % SR) for the Convergence

objective regions; 100 % (50 % EU, 50 % SR) for other regions

Axis 4 Implementation of the LEADER approach

Implementing integrated local development strategies

Implementing cooperation projects Running the local action group

Financing of RDP

Futureof CAP -1st pillar

Futureof CAP -2nd pillar

Contact

Pavol Schwarcz

Faculty of EU Studies and regional develpoment

Dep. of EU Policies

[email protected]

[email protected]

cap and rural development policy in the eu and slovak republic imrd, nitra july 15, 2014

Documents

cap slide

vat slide

pillar slide

cr slide

total eu budget slide

sources of eu budget

cap reforms

source of financing