Præsentation på ESRS-kongressen i Aberdeen 20 august (engelsk)

The view from Brussels.  (SLIDE 1)

I asked a senior consultant to DG-Agri:

"What about Phil Hogan, what is his vision?"

"Well he is under a lot of pressure from the the Juncker-commission, to create economic growth and jobs. " He answered.

"But isn't that contradictory in the agricultural sector?" I replied.

- his words were: (Soundbite: 1.01.10 Laughs)  

"For agriculture it is very hard to produce jobs or growth. Yes you are absolutely right it is a completely impossible (t)ask"  

When I first started writing this presentation, I imagined I could just skip all the technical stuff and share with you the gossip and corridor-talk from inside the loop in Brussels. But the irony, witticism and gloom embedded in some of the accounts doesn't make any sense, if we dont have common ground and references. So I will begin by giving a brief overview of how the Common Agricultural Policy comes into being, and who the main stakeholders are - and in doing so share some of the thoughts and reflections, that informants expressed to me during my fieldwork.

Secondly I will present the key challenges facing the European agricultural policy leading up to and beyond  the 2020-reform and lastly give a short description of the new commsioner's mandate and his agenda.

It is a complex and far-reaching topic, so many things will be left out and many surfaces only scratched, but I hope to strike a friendly balance between presenting my research, quoting informants and illustrating my points here on the screen.

(SLIDE 2)

I imagine I can safely assume, that eveybody here knows what the CAP is, and likewise that no particular introduction to Pillar One and Two is required, and none will be given.

But to even understand why the CAP exists at this point in time, to understand why we massively support Europe's farmers - and particularly relevant for the overall theme of this conference - why  chose to maintain this dependency on subsidies, when everything else is being dominated by the market and its competetive justice.

To understand this enigma let us take a look at this quote:

(SLIDE 3)

"It is quite an interesting stasis. The reason we even have a CAP today, is because it is the main instrument for redibristuting EU funds. It is absolutely embedded in the EU distributional logic of the EU-budget. If you look through the CAP-reforms, you can make small changes, but the actual amount of money going out to each memberstate remains the same,  because the fact is, that so much of the EU budget is distributed back to the member-states through the CAP, it is a historical accident....the CAP has become the funnel. Everybody agrees it is wrong, but nobody will change it. That is the false psychology in the heart of pillar one."

(Tomas Garcia Azcarate DG Agri)

I am unsure how widely known or agreed upon this underlying assumption is, none of the politicians I spoke to mentioned that the CAP predominantly is a redistributional tool and on the other hand all the expert-informants I spoke to underlined this fact - as well as claiming that it will remain as such regardless of what other priorities arise, what farming evolves into or what freetrade-agreements will try to curb. And interestingly most agreed that no matter what, it was better to have some kind of public influence on the sector through the CAP - than none at all.

(SLIDE 4)

You probably also know that the CAP runs in seven-year cycles, meaning that every seventh year a new retuned or reformed policy is introduced and then subsequently implemented in each memberstate. The Commission on the other hand has a term of 5 years and this discrepancy do cause management problems for the CAP, but we'll get a glimpse of that at the end of this presentation.

In passing I should mention that there are many other important directives and policies which concerns the agricultural sector, the CAP remains however the most significant.

Regardless of the agro-issue, there are a number of main protagonists, that I will briefly introduce here.

(SLIDE 5)

™ The head of the commission and the mission-agenda

™ The Commissioner on Agriculture and his cabinet

™ The DG-Agri (Advisory/Expert-groups)

™ The Parliament Committee on Agriculture (COMAGRI)

™ The Counsil and memberstates (BudgetRedistribution)

™ Copa-cogeca (CEJA, IFOAM)

™ CELCAA, FoodDrinkEurope

™ The petro-chemical lobby (Regulations on foodsafety)

™ Banks, industri and commerce.

™ IEEP, Wageningen

™ Birdlife, Friends of the Earth, EEB

™ CEO (Corporate Europe Observatory)

™ WTO, Free Trade Agreements,

The head of the commission: Currently Juncker and vice-president Timmermans and their notorius ten-point plan for growth and jobs - to catapult Europe out of the so-called financial crises. From this pair a policy-paper was send to each commissioner, which expounds on how to fulfill this überplan in each policy-area, including agriculture, as alluded to in my initial remarks.

Another very influential position, jus under the public radar, many are funned of saying the most powerfull person in Brussels, is the Secretary-General of the European Commission: currently Catherine Day. The chain of command means that nobody gets access to Juncker, or Barroso before him, without going through Day. She was appointed in November 2005 but has been in various positions in Bruxelles since 1979. She has a background in banking and industry and is one of the main adversaries of the green and environmental organisations. I heard many anecdotes about her role in disrupting political processes not to her liking.

NOTE: It is called the Commissioner on Agriculture and Rural Development, as well as the commitee on agriculture and rural development. The balance between the two is very interesting, very relevant and a highly contested issue; however the time allotted me here today does not permit a discussion of it, and in the presentation I will simply omit rural development and the whole Pillar two debate!

The main policy-driver as regards matters of agriculture is - no wonder - the commissioner on agriculture and his cabinet.

The still-new commissioner on Agriculture is Phil Hogan from Ireland; and his compatriot chief of Cabinet : Peter Power, if you google him you will learn that he is a crises-management-expert - just as well one might add.

I arrived in Bruxelles just two weeks after the hearings when the outgoing commissioner Ciolos was still in office, so nobody had practical experience with Hogan. Who he is will largely be deducted from his hearing and subsequent speeches.

However I will address Hogan and his agenda lastly, in order to finish this presentation with some tentative predictions.

Like in any national administration, the civil servants - as well as the consultants and lobby-organisations, who make up the advisory or expert-groups, which I will talk about later - are both more knowledgable than the the elected politicians, some of the people I talked to had taken part in 4 consecutive CAP-negotiations - but perhaps more important - often the non-elected are also more agile in creating political allies in Bruxelles, making the job of being a commissioner with a reform agenda  a lot more difficult - as we did indeed see with the latest reform-process. The balance of power is suposedly kept slightly more even by the fact that a commissioner appoints his own cabinet, often with people from his national or previous occupational background - in other words people he can trust - although in the case of commissioners from the so-called new memberstates they are expected to chose a chief of cabinet from an old memberstate, as was also the case with the previous commissioner (a Romanian commissioner chose an Austrian chief of cabinet)

(SLIDE 6 printed paper read aloud))

The DG-Agri is the main hub in all agricultural matters. The DG Agri is made up of civil servants, about 1000 of them, and experts who write, administrate and control Europe's agricultural policies. It is a big and complex institution which is composed of as many offices and desks as there are specialised interests across Europe.

My impression was that the people in DG Agri were very informed on agricultural issues, and every single one I spoke to at odds with the general development of the CAP. I believe this dissatisfaction had a lot to do with the fact mentioned above, the false psychology in the budget-considerations, but also the struggle with the parliament-committee, which I will get to shortly, and how that influenced the overall result of the latest CAP-reform.

This is the new DG-Agri-mission statement: (SLIDE 7)

                      1. MISSION STATEMENT (2014)

The mission of the Directorate General for Agriculture and Rural Development ("DG AGRI") is to promote the sustainable development of Europe’s agriculture and to ensure the well-being of its rural areas.

" The core elements of the Commission's proposals were accepted by the European Parliament and the Council. However, Member States have been given more flexibility and subsidiarity in the implementation and choice of certain policy instruments, e.g. coupled support, support in natural constraint areas and redistributive payments, as well as the possibility of financial transfers between the Pillars. Whilst this will allow Member States to better fine-tune the measures to the national and regional situations, it will make their implementation and control more challenging." (page 1 of 132)

This may read a bit dull and unambitious, but it alludes to two  important factors. Firstly that although the directives, policy and regulations are minted in Bruxelles, the concrete implementation has to be done on the national level, and everybody agrees that a lot of problems arise because the member-states either dont implement or under-implement - and in any case see their neighbors as competitors and try to protect their own farmers - at the expense of the spirit of the CAP. You may recall that France just this year was given a fine of 338 mio euros for illegal farm-subsidies, a fine that the French taxpayers will have to pick up.

Then follows Greece and Denmark which, although comparetively small, is third in Europe, in picking up the biggest fines related to bad management of the CAP-funds.

Secondly the statement discreetly articulates Juncker's discontinuity-agenda, but we will return to that later.

(Back to SLIDE 5)

You have the commitee on agriculture (COMAGRI) in the parliament, made up by politicians from the various memberstates predominantly with either an agricultural background and therefore a vested interets in particular topics, or politicians that have made an alliance with big agro-interests - as is the case for instance with the Danish member. Since the Lisbon treaty, the parliament has had significantly more influence. This means that this commitee is under a tremendous pressure from the agro-lobby - or agro-interests - to do their bidding. The members I spoke to were quite frank about this influence and felt vindicated about it as they believed it was in the interest of their own constituences.

However this is what two senior DG-Agri informants said about COMAGRI:

(SLIDE 8 and 9))

"In 2009 the new ordinary legislative  procedure was introduced,  Before the Counsil was the sole decision-maker, now the Parliament is part of the new structure called the trialogues, which means that the commitee on agriculture is an important third party in writing the next CAP. This commitee is very much an extended voice of the productivist agricultural agenda, that is in line with Copa-Cocega....they had 8000 proposals to change the commissions reform-draft!"

8000 proposals, can you deduce what that signifies? If you know just a little bit about much work that entails, you can figure that some heavy-duty well-staffed third-party wrote these proposals.

"The farmers are symbolic as well as actual in my view, because a lot of the politicians are quite populist by instinct, so if they can say that they are fighting for the farmers, it sounds good, even if they haven't thought through what that means. So the farming lobby really doesn't have to work that hard with their arguments, they don't really bother in their literature, you won't see a lot of heavy-duty evidence if you read their reports. they don't need to.. It was the parliament that watered down the commission's proposal" "

So before I explain what and who COPA-COGECA is, the likeliest author of the bulk of the 8000 proposals, let us just recount how the CAP is born.

(SLIDE 10)

The trialogues and the concrete implementation

™ The EU-budget is redistributed back to each memberstate through the CAP

™ Commission(er) (DG Agri) (Expert-groups)

™ COMAGRI (The Parliament amends and votes)

™ The Counsil (The 28 ministers of agriculture)

™ Implementation customized in each memberstate

Let us take a quick look at the main stakeholders: The Farmers:

(SLIDE 11)

™ COPA-COCEGA

™ CEJA (young)

™ IFOAM (organic)

Copa-Cogeca is the main farming lobby organisation. It is a merger of COPA, the professional farmers association and COCEGA the agro-cooperatives, and according to their own website represent 30 mio. farmers across the continent. Accordingly the organisation has to embody the interests of a very diverse european primary production-sector and often also synthetise contradicting views.

But it is my view, that once an organisation reaches a certain size and political leverage - the focus of this organisation switches from the original cause, in this case the individual farmer or the farming community - to sharing interests with big business and big finance. When you take a cursory look at the practical politics of COPA-COCEGA, it would seem that the focus is to create an industrial productivist speculative market environment which favors investors and production methods not in favor of an independent farming community much less a sustainable social rural development and therefore not in favor of  what most farmers wish for themselves and their families.

As may be known to some of you, COPA-COCEGA fought hard and won the battle against the previous commissioner's ideas of a link between subsidies and 'public goods' in the form of environmental protection, the so-called 'Greening of the CAP'. Additionally the new commissioner is their man, so to speak. So it came as no surprise to me that COPA-COCEGA's secretary general Peka Pessonen was pretty smug when I met him in the huge officebuilding across the street from DG-Agri.   

"We do public goods everyday - it doesn't matter if we get paid for it or not, we will do it anyway..." - was his reply to the ongoing debate about how to legitimize the CAP-subsidies.

 I also asked him who COPA-COCEGAs main adversaries were? He couldn't think of any. 

If he saw eye to eye with for instance FoodDrinkEurope, the retail-lobby? Have a look of my transcript from the interview.

(SLIDE 12)

™ ”I am meeting with the director of 'FoodDrinkEurope'  later today, what question do you think I should ask her?"

™  

™ ”Oh you are meeting with Roxanne, yes she used to be employed here. She is a good expert. We agree on most things, but they are more focused on consumers. We would like them to do more to sell European produced goods. A lot of the food sold contains ingredients produced in countries outside Europe, that way they can enhanse profits, but that is of course their priority, they serve the industry. But we are 90% allied.

™  

™ ”Is there anybody in Bruxelles who are your political adversaries?  

™ ”No, I wouldn’t say that. Since I arrived in Bruxelles in the 90ties, a significant change has occurred, today there is a much more positive attitude  around agriculture. Yes in the grand scheme of things we are happy with the political landscape.”

As you can see on the slide, he was very satisfied with the political ambience.

To me it is simply incredible that a man representing the farmers of Europe, a sector that across the continent is in a serious crisis: Bankruptcies, a worrying age-ing of the producers, desease-epidemics, water-shortage in the south and floods in the north, a high volatility in the food-marketprices , Russia's food-import-ban, the impending threat of TTIP and arguably worst of all a deterioating social fabric in the rural areas, related to the structural development in agriculture - He was just happy and proud.

It is therefore all the more remarkable that the young farmer's union CEJA (Back to SLIDE 11) , officially agrees with COPA-COCEGA on the policies. Unofficially the CEO Kleopatra Sidipopulous has a lot to say that differs from Pessonen's attitude, she is very worried quote unquote. I tried to sketch some of the contradictions between what a young farmer might aspire to and the general trend in agricultural development, and why in my oppinion COPA-COCEGA did not represent the young farmers.

 She often agreed, but on a pratical political level. CEJA's strategy is to be in line with their parent organisation.

I didn't get to meet with IFOAM, the organic farmer's union, but from what I heard, my impression is that along with a more environmental-friendly stance, they - by and large - share the productivist view, farming is a business and: output, efficiency and feasability is the indicators you need to measure the policies after.  

(SLIDE 13)

On the ’third’ side of the table…’expertgroups’

™ FoodDrinkEurope (UNILEVER, Kraft, Nestlé, Coca Cola, Danone..)

™ CELCAA (Retail – big supemarket-chains)

™ ESA (European Seed Association) (Patents on genetic ressources)

™ ILSI (International Life Sciences Institute) (Lobbying for big business)

™ Petro-chemical lobby (Bayern, BASF, Dupont, Monsanto, Syngenta..)

™ Finance (ISDA, EFSR, AIMA,)

™ Wageningen (Dutch Agricultural University, influential newsletters)

™ EEB (European Environemental Bureau)

™ IEEP (Institute for European Environmental Policy)

™ CEO (Corporate European Observatory)

™ Birdlife, Via Campesina

™ FAO

One way of assessing how third parties, including big business, their consultants and scientific experts influence the CAP through the 'expert-groups' is quoting the EU ombudsman, Emily O'reily:

(SLIDE 14)

™ Formally known as 'Expert Groups', they are particularly influential at the beginning of the legislative process, shaping – and even drafting – Commission directives. This makes them a key target for industry lobbyists, who have traditionally dominated the most politically and economically important groups (…) At the heart of the Ombudsman's recommendations was a call for Commission Expert Groups to be more balanced. That was the focus of the investigation, and it also made up the bulk of the recommendations.” (The Ombudsman’s report, june 4th 2015)                                                    

™  

™ To which Vice-President for Transparency in EU Frans Timmermans responded: ”these are experts not lobbyists, so vested interests don't count.”)

Another is using CEO and their work for transparency.

(SLIDE 15)

Corporate European Observatory.
Interview with Nina Holland

™ ”I find it shocking how they (Copa-Cocega) is selling out of the interests of their own farmers.”

™ ”DG-Agri promised to reform the expert-groups to allow more NGO/alternative views. They did, but at the same time they increased the frequency of meetings creating a situation where only the big could attend.”

™ ”In DG Agriculture and Rural Development, they have legally-binding rules of balance between economic and non-economic actors, although they do not appear to follow these rules .The EU is less democratic than before the Lisbon-treaty.”

Although it may seem biased, I included the first quote, because as I have already  alluded, it is one of the hypothesis in my Ph.d.-project,  that the organisations that should represent the interests of the farmers are busy designing a foodproducing sector for big industry, and that the farmers of Europe have been hijacked into this economic growth versus the environment agenda, which is prevalent in the expert groups.

In relation to the last quote, just recently Emily O'reily, released  preliminary report on transparency in the expert-groups. 

(SLIDE 16)  This list continues and in some of the expert groups the percentage of economic interest is even higher than here.

(SLIDE 17) Here are two examples of publications from CEO. In passing I'd like to mention, that my informant in CEO pointed to ILSI, an American-based consultancy-firm, as the most dodgy and influential lobby-group. Look them up if you're interested.

So as you can see  the CAP comes into being through a very complex and often opaque political process, in which the overall redistributional agenda overrides the neoliberal market-agenda,  nonetheless the subsidies have been made to work in favor of big industry and speculation.

Two of the main 'scientific' policymakers , in so far as the expert groups and producing research-based evidence to back up the political agenda is IEEP on the 'greenish' side and Wageningen, the agricultural university in Holland, on the productivist side.

I will run through the some recent forward-looking policy-papers that have come from these two institutions, they should be read as sort of after-thoughts in the wake of the latest CAP-reform.

(SLIDES 18-21)

™ Steering CAP reform needs strong leadership. This is likely to require a determined push from a set of interested Commissioners embracing agricultural, regional, environmental, energy / climate and budget policy. A solo agricultural Commissioner, however brilliant, will struggle to break any moulds. This is even more the case since other DGs will be looking for a slice of the CAP budget and could be pressing their case with some force in a tighter economic climate when a new MFF is sketched out in 2016.

™ The architecture of the CAP will be under scrutiny with more pressing questions about the value of maintaining two pillars and the associated funding rules for each pillar which have served to constrain the growth of the rural development strand.

™ If the environmental movement is sufficiently disillusioned with the CAP, as could well occur, they could argue for a large slice of the funding to be transferred to a new environmental fund with different rules and administered by different authorities. The interests of those who support the focus of a significant component of funding on rural areas could diverge.

™ A market safety net apparatus, involving intervention in extremis and also encouragement of farm level insurance, will continue with a small share of budget; but with risks of more volatile expenditure commitments and pressures for a more common approach than the current one driven by Member States.

™ Cost effective and administratively feasible environmental land management will be a core issue. This requires much discussion on how to incentivise famers to manage the environment better, avoiding perverse results and obsessive bureaucracy. This may involve more: collective/cooperative delivery, payments by results, landscape/catchment scale approaches, with greening absorbed into voluntary, programmed, multi-annual schemes.

™ It should also involve more creative thinking about how to maintain accountability and rigorous auditing of real results on the ground without micro measurement or driving farmers and governments into risk adverse behaviour with easy to measure but not very useful commitments.

™ Further emphasis on innovation and modernisation of mainstream agriculture so it becomes a sector which can operate within legislative environmental standards without annual subsidy, with the potential for greater emphasis on improving farm uptake of the fruits of research solutions for sustainable gains in productivity and yields.

™ At the same time there could well be countervailing pressure for addressing more issues by reverting to market regulation (with a less direct cost on the EU budget) rather than through CAP payments. This would be a reversal of the most important reforms of the last 25 years.

™ The solutions to these challenges may not all be “common” in the sense that producers are treated in the same way. For example, quite different actions may be needed in the prime agricultural producing areas relative to the more economically marginal but environmentally sensitive areas, especially those associated with high nature value farming. The current distribution of funding between farms should not be treated as a sacred cow.

OK we have arrived at the final part of my presentation:

The new commissioner and what lies ahead.  

(SLIDE 22)

During Phil Hogan's hearing on 2nd of october 2014, which by the way is still available online, four central phrases were heard numerous times: 'Sound science', 'growth and productivity', 'viable farms' and 'simplification' - phrases which he has continued using since in his statements and speeches:

Here are some quotes

"I want agriculture to benefit from science, technology and innovation, this can create jobs."

"We need sound science"

"69% of the farmers in Europe are below 5 ha, we have to make sure we have a viable sector and it is a significant challenge for the structural reform."

Here are some quotes from a recent speech he gave in Spain: (SLIDE 23-24)

™ First and foremost, the global context is favourable: worldwide demand for high-quality food will increase steadily in the coming years, particularly in the emerging markets of Asia and Africa. Each year until 2030, at least 150 million people will be entering the global middle class.

™ As you know, the statistics are positive: with growing world food demand, the agri-food sector is the 4th largest export sector in the EU, increasing the value of its exports in the last 5 years by 70% - which is faster than overall EU exports.

™ Fourthly, I am highlighting to the business community that investing in the agri-food sector is an increasingly attractive and decisively rewarding prospect.

™ New ‘smart-agri’ production systems. Areas like innovation in food processing and food technology; enhanced use of ICT to improve efficiencies; and improved collaborative networks between investors, researchers and farmers will turbo-charge these exciting changes. With enhanced robotics technology we may well see farms where self-driving tractors and harvesters free up the farmer to concentrate on other tasks. (Or unemployment?)

In other words Phil Hogan is very much in line with Juncker and the ten-point plan, the current agricultural agenda is all about economic growth and jobs and never a single word about the effects on the environment or social fabric.

But one may ask oneself, as quoted at the beginning of this presentation,  aren't those visions hard to realize in the primary sector, where labour-input is rapidly decreasing?

(SLIDE 25)

(showing the amount of people losing employment in agriculture in Europe over the last decade - in Spain 224.000, in France 171.000, in Italy 120.000, in Ireland 42.500 and Denmark 17.000, no EU-memberstate have created new jobs in agriculture 200-2011)

(SLIDE 26)

Juncker’s discontinuity

™ "The operational motto of the new Commission is to be bigger on the big things and smaller on the smaller things. Simplification ...includes the greening and ecological focus areas which are commitments of the out-going commission. Reducing bureaucracy is very much at the forefront of my commission and a market-led CAP.”

™ (Phil Hogan during the hearing oct. 2nd 2014)

In all likelyhood employment will fall drastically, especially in the new memberstates, during Hogan's term, and TTIP will create a lot of uncertainty, especially among the beef-producers. An attempt at dismantling the greening of the CAP is already underway and new technologies will create a stronger pressure for hightech investments, making it even harder for individuals to be independent farm owners, and hand in hand with a further urbanisation, it will allow for a more industrial foodsector, because, for one thing, there are simply no neighbors to worry about...and the environment will sadly suffer due to all these developments. I too am quote unquote very worried, that this commission and this commissioner are the worst imaginable leaders to face up to real sustainabilty, climate changes and a deterioating social cohesion in rural Europe.

Thank you.