Agri commissioner calls for ceiling on CAP payments to large farms

European Union farming subsidies should be compulsorily capped to cope with the accession of agricultural powerhouse Ukraine, according to the EU’s Agriculture Commissioner Janusz Wojciechowski, as discussions heat up about the future shape of the next Common Agricultural Policy (CAP) reform.

Speaking on the sidelines of the EU executive’s recent agricultural outlook conference, Wojciechowski said the bloc should prevent Ukraine’s membership from adding to Europe’s growing trend of land concentration.

“A big part of Ukrainian agriculture is dominated by big agro holdings,” he said, adding that the EU should “avoid pay[ing] subsidies for such big companies”. 

According to Wojciechowski, an EU-wide mandatory capping system would be “a good answer” to tackle land concentration and the fact that the average Ukrainian farm is even larger than those in the EU. 

Currently, EU member states can voluntarily cap the amount of direct payments individual farms can get to prevent large farms from benefiting excessively from subsidies. According to EU data, 80% of these payments went to the top 20% of farms in 2019. 

The Commissioner’s comments reflect rising concerns over the impact that Ukraine’s inclusion into the bloc will have on the EU agrifood sector. 

Last month, a leaked paper drafted by the European Council revealed that Ukraine would be eligible for €96.5 billion of CAP funds over a seven-year EU budget period, leading to cuts of about 20% in farm subsidies to current EU member states.

Meanwhile, in October, Ukraine’s Deputy Economy Minister Taras Kachka said that Kyiv’s EU membership will likely trigger a re-write of the CAP, leading to the end of the farming subsidies programme as we know it.

Germany calls for a turning point

Agriculture ministers also exchanged views on how EU farming could accommodate Ukraine’s potential accession to the EU during their meeting on Monday (11 December).

While voicing support for Ukraine’s EU membership, a number raised the concerns about the impact a global agricultural powerhouse such as Ukraine as a recipient of EU farming subsidies would have.

One of the most vocal on the topic has been Germany, which has repeatedly called for far-reaching reform of the CAP.

Ahead of Monday’s meeting, German Agriculture Minister Cem Özdemir sounded the alarm, saying that the EU’s farm subsidy programme would be at risk if it were not reformed before Ukraine’s accession.

“If we leave the current agricultural policy as it is and enlarge the EU to include Ukraine, Moldova, the Western Balkan countries, (…) the system will collapse,” he said. 

Özdemir added that enlargement was an opportunity to change the course of EU agricultural policy and set new guiding principles, “making sure that those services that [EU] farmers provide for the public, for animal welfare, for climate protection, [and] for biodiversity are reliably remunerated”. 

Similarly, back in September, a group of German regional agriculture ministers recently called to leave behind the CAP’s “unconditional area payments” and instead focus on the principles of a “common good premium”. 

Although there is already a range of instruments for more environmental, climate, and animal protection within the CAP, a large part of the money – the so-called direct payments – continues to be paid to farms solely based on the farm area.

Sustainability standards

Meanwhile, other countries, including Poland and Slovakia, also raised concerns about how Ukraine would adapt to EU standards before joining the bloc. 

This could be a challenge as Kyiv has relied heavily on intensive production methods, while Brussels, as part of its European Green Deal commitments, is making increasingly high demands on agriculture regarding environmental and climate protection.

“Protecting the EU internal market from an inflow of products [from] food systems that are not sustainable is essential,” read a note by the Polish delegation presented at the EU Council meeting. 

Julia Dahm contributed to this reporting 

[Edited by Natasha Foote/Alice Taylor]

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