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Financing the transition to sustainable farming

In addition to the compulsory elements of its green architecture, the CAP includes funding to support a range of rural development and agri-environment-climate measures under its Pillar II. Because of the high cost involved in transforming whole production systems, rural development has been a pivotal instrument in supporting the adoption of sustainable farm practices, from the adoption of new technologies to soil conservation practices, crop diversification, organic farming and agroforestry.

Under the WFD planning process, authorities have largely relied on RDP funding for the implementation of measures reducing pressures from the agricultural sector (EC, 2019a). Assessments of the inclusion of water measures into RDPs indicate that that Member States have progressively increased their level of support over time (Mohaupt et al., 2007; Rouillard and Berglund, 2017). Box 4.7presents the level of integration of water issues in the current RDPs 2014-2020.

The new CAP architecture proposes to keep this instrument, and rural development payments will remain an important mechanism to increase the adoption of sustainable farming practices. Drawing on the lessons from the current programming period, a number of observations on good practice can be made (Berglund et al., 2017):

• Some RDPs such as the one from North-Rhine Wesphalia in Germany, prepared an in-depth initial “gap assessment” synthesizing water challenges, drawing on the latest data and information from the RBMPs and FRMPs. This provided a good basis for selecting relevant priorities and measures in the RDP.
• Some RDPs financed innovative approaches to dealing with agricultural pressures. For instance, the Norther Ireland RDP in the United Kingdom financed the modernization of manure storage as well as nature-based solutions such as constructed farm wetlands, which can reduce the need for storage.
• When drafting their measures, some RDPs have gone further than the minimum legal requirements. More ambitious requirements include for example the requirement to save at least 25% of water if receiving support for improving irrigation efficiency (in Croatia), the establishment of buffer strips of 20m wider, or the prohibition of pesticide application in targeted areas.
• Some countries includes explicit criteria for preventing harmful investments for water bodies. For example, Latvia funds in its RDP drainage schemes if they show compliance with the procedures of the WFD for assessing and preventing the deterioration of water bodies. Furthermore, it priorities projects that include mitigation measures such as sedimentation ponds and wetlands.
• Some RDPs integrate climate adaptation and the need to build resilience in farming systems through appropriate crop diversification (e.g. Greek RDP) and adoption of drought resistant crops (Romanian RDP).

Safeguards are particular important to avoid counterproductive RDP investments in areas of greatest pressure. For instance, it was still possible in the current RDP planning period to fund irrigation investments that could lead to an increase in irrigated areas or the uptake of more water intensive crops – resulting in increased consumption and lower return flows ( Chapter 4.2.2) - in catchments with water bodies failing good status (Devot et al., 2020). Similar checks are needed on other investments such as drainage, the construction of reservoirs, and flood risk prevention measures.

The use of more water-relevant indicators in the Common Monitoring and Evaluation Framework could support a better assessment of the contribution of RDPs to water policy objectives – a task that was challenging under the current monitoring approach (Devot et al., 2020). Such indicators could track progress in nutrient and pesticide load reduction, improvements in morphological conditions, reducing water imbalances and meeting environmental flows.

The EU Biodiversity Strategy 2030 (EC, 2020d) calls for increase the area of organic farming to 25% of UAA by 2030. Organic farming is undergoing a significant growth, but total area remains at 7% of UAA in Europe. In January 2021 a new EU Basic Regulation on organic farming will come into effect and replace the existing legislation. The main benefit of the new regulation will be a further alignment of rules of production and control for goods produced in the EU and those which are imported. While this will further protect the standards held in Europe, greater policy support will be needed if the ambitious objectives of the Biodiversity Strategy is to be realized.