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Hidden in Plain Sight: Redirecting European Farm Subsidies to Reduce Income Inequality and Support Biodiversity and Climate

  1. Photo: Tim Lindstedt, Flickr Hidden in Plain Sight: Redirecting European Farm Subsidies to Reduce Income Inequality and Support Biodiversity and Climate Kimberly Nicholas, Mark Brady, Murray Scown Lund University Centre for Sustainability Science (LUCSUS) kimnicholas.com @KA_Nicholas @KA_Nicholas
  2. @KA_Nicholas 2 Rencanti et al., 2018, Science of Total Envt EU’s Common Agricultural Policy (CAP) • Average €54 billion/year since 2006 • 38% EU budget 2014-2020
  3. How food connects all the Sustainable Development Goals @KA_Nicholas 3 Stockholm Resilience Centre, 2016
  4. Objective alignment with SDGs @KA_Nicholas 4 Aligned Not Aligned Scown & Nicholas, 2020, Global Sustainability
  5. CAP not optimised to meet SDGs @KA_Nicholas 5 Scown & Nicholas, 2020, Global Sustainability
  6. 32 core variables for European sustainable food systems @KA_Nicholas 6 Scown, Winkler, & Nicholas, 2019, PNAS Winkler, Scown, & Nicholas, 2018, Land Use Policy
  7. Current CAP poorly aligned with objectives & SDGs; poorly measured @KA_Nicholas Scown, Brady, & Nicholas, 2020, One Earth
  8. Current CAP: 40% payments misspent @KA_Nicholas Scown, Brady, & Nicholas, 2020, One Earth
  9. Paying polluters @KA_Nicholas https://theconversation.com/eu-subsidies-benefit-big-farms-while-underfunding-greener-and-poorer-plots-new-research-144880
  10. Income support mis-aligned w/ goals @KA_Nicholas Scown, Brady, & Nicholas, 2020, One Earth
  11. Open access methods, code, and data @KA_Nicholas Nicholas et al., 2021, Patterns
  12. Open access methods, code, and data @KA_Nicholas Nicholas et al., 2021, Patterns
  13. Conclusions • Need shared agenda for sustainable food systems • Use existing indicators across all SDGs Subsidy reform: • Make income support needs-based • Results-based payments for public goods @KA_Nicholas wecanfixit.substack.com
  14. 14 This project supported by: Swedish Research Council (VR) Project Grant 2014-5899, “Mapping the environmental, economic, and social tradeoffs of European farming systems across scales.” Thank you! Photo: Marcel Kerkhof, Flickr @KA_Nicholas http://www.kimnicholas.com/european-farming-systems.html Open access publications and datasets: Kimberly A. Nicholas, Frida Villemoes, Edmund Lehsten, Mark V. Brady, and Murray W. Scown. (2021) “A harmonized and spatially-explicit dataset from 16 million payments from the European Union’s Common Agricultural Policy for 2015.” Patterns, in press. ​Murray W Scown, Mark V Brady, and Kimberly A Nicholas. (2020). “Billions in Misspent EU Agricultural Subsidies Could Support the Sustainable Development Goals.” One Earth 3: 237- 250. https://doi.org/10.1016/j.oneear.2020.07.011 Scown, Murray, and Kimberly A Nicholas. (2020). “European agricultural policy requires a stronger performance framework to achieve the Sustainable Development Goals.” Global Sustainability 3, e11, 1– 11. https://doi.org/10.1017/sus.2020.5 Scown, Murray, Klara J Winkler, and Kimberly A Nicholas. “Aligning research, policy and practice on sustainable agricultural land systems in Europe.” (2019) Proceedings of the Natural Academy of Sciences of the USA (PNAS) 116 (11) 4911-4916. https://doi.org/10.1073/pnas.1812100116 Winkler, Klara J, Murray S Scown, and Kimberly A Nicholas. 2018. “A classification to align social-ecological land systems research with policy in Europe.” Land Use Policy 79 (137- 145). https://doi.org/10.1016/j.landusepol.2018.06.034

Editor's Notes

  1. CAP is under reform in 2020. The goal is to better integrate, promote better health for people and the environment, support rural landscapes and livelihoods. To know what to reform, we need to know how well CAP is doing now to support sustainable land use and food sytems? What needs reform? The Common Agricultural Policy (CAP) is the guiding agricultural policy of the European Union (EU) and is a potentially very powerful tool to guide agriculture’s contribution to the SDGs. Spending under the CAP has averaged €54 billion annually since 2006 (14)—constituting 38% of the EU’s 2014-2020 budget (15). The policy is divided into Pillar I, focusing on financial support to farming, and Pillar II, rural development programmes. The majority of CAP spending is through Pillar I, primarily direct support to farmers (around 69% of total CAP spending in 2017 (15)), as well as market measures (around 5% of spending in 2017 (15)), and horizontal aspects (non-financial polices to ensure agricultural practices comply with other EU sectoral policies; e.g., the Nitrates Directive). About 25% of total CAP spending in 2017 went to rural development through Pillar II (15). Monitoring and evaluation of the CAP is conducted with suites of indicators at different policy stages, including Objectives, Implementation, Outcomes, and Impacts, as well as those covering Contextual factors (Table 1; our classification derived from ref. (16)). The CAP is set to be reformed after 2020, and the European Commission has communicated that the policy should develop in line with the SDGs (17). Yet, limited evaluation exists of how the CAP—the EU’s largest single budget item—aligns with the SDGs (e.g., refs. (15, 17)). Rencanti: https://www.sciencedirect.com/science/article/pii/S0048969718342773 Barilla: http://foodsustainability.eiu.com/whitepaper-2018/
  2. https://www.stockholmresilience.org/research/research-news/2016-06-14-how-food-connects-all-the-sdgs.html
  3. To assess the contribution of the CAP to the SDGs today, we took a quantitative approach. We took existing indicators: measurable observations of the current status and trend over time of a desired goal. Our method is Important because existing analyses are not transparent about how they decide something is aligned with/supports SDGs or not, this makes it clear and replicable. We aligned the 100 EU SDG indicators… …with 255 agricultural indicators used to monitor the effect of the CAP by DG Agri & Rural Development, who is in charge of CAP implementation and assessment, as well as by the European Environment Agency.
  4. We used these indicators to assess how well the current CAP in Europe aligns with the SDGs. The pie slices show the number of indicators for each SDG, from zero to six per SDG. We find that current CAP indicators focus on three goals: sustainable agriculture (SDG 2), work (SDG 8), and biodiversity (SDG 15). Each of these has 4 or 5 indicators, so we have a good idea how CAP is affecting them. But Many important SDGs have just one or 2 indicators in the CAP, here we can do better. And 4 SDGs are missing entirely from the agricultural indicators: health (SDG 3), gender equality (SDG 5), oceans (SDG 14), and institutions (SDG 16), This contradicts recent reports proclaiming agriculture’s contribution to all SDGs globally. Ag could contribute to all, but right now in Europe we’re not measuring if and how it does. Conclusion: we need more comprehensive indicators of sustainability in the CAP. We can use some existing ones. Or we need to acknowledge that ag currently will not meet all SDGs, and other sectors need to do that. We list the indicators here so you can see exactly what we’re talking about. That’s what makes this transparent and replicable.
  5. There are 32 variables that are shared among sci pol and farmers: drivers relating to polices on climate, environment and agriculture, as well as subsidies and land ownership; farm management choices including tillage and use of fertilisers, irrigation, and pesticides; environmental outcomes including soil and biodiversity we have indicators for them to monitor over time- we should be using these to make measurable goals and progress for using land to achieve SDGs. Need more attention to social dimensions. – The social dimension of the agricultural sector appears to be very under-researched in Europe. This is a clear example of the need to have input from all three groups, says Murray Scown. The analysis found shared consensus among researchers, policymakers, and practitioners for 32 key variables (Figure 1). There was a shared focus on. The research team suggests these 32 variables be included in future studies and policies to make the best use of existing priorities, and that the method they developed can be used to quantitatively track progress towards the SDGs. 
  6. Our analysis showed that at least €24 billion a year goes to support incomes in the richest farming regions of the EU with the fewest farm jobs. Meanwhile, the poorest regions with the most farm jobs are left behind. These essentially unnecessary welfare payments would more than cover the €20 billion a year needed to meet the EU’s biodiversity strategy, or could be better spent on other goals in regions of greatest need. Our results show that current spending is exacerbating, rather than reducing income inequality among farmers, because income payments are simply based on the area of land farmers manage, not their needs. The larger the farm, the higher their income support. The way these payments are allocated requires no proof of environmental benefits – everyone gets the same payment for each hectare of land. As a result, the very premise on which the majority of CAP support is paid is gravely flawed. In what was perhaps most surprising, we also found that substantial payments intended to support rural development are actually made to urban areas. Our August 2020 study found that 40% of CAP payments were misspent; they went to support incomes in the richest farming regions of the EU, which provide the fewest farm jobs. What reforms do you propose to ensure that the first modern objective of the CAP, supporting viable farm income and resilience, are actually met? What CAP reforms are needed to ensure that Member States actually deliver the European Commission targets of reducing greenhouse gas emissions 55% by 2030 and that the alarming decline in biodiversity is on a path to recovery by 2030? Rural development is a core objective of the CAP. Yet our August 2020 study found that €2.5 billion in rural development payments went to primarily urban areas. How do you propose ensuring that the CAP truly benefits rural communities?
  7. Our analysis showed that at least €24 billion a year goes to support incomes in the richest farming regions of the EU with the fewest farm jobs. Meanwhile, the poorest regions with the most farm jobs are left behind. These essentially unnecessary welfare payments would more than cover the €20 billion a year needed to meet the EU’s biodiversity strategy, or could be better spent on other goals in regions of greatest need. Our results show that current spending is exacerbating, rather than reducing income inequality among farmers, because income payments are simply based on the area of land farmers manage, not their needs. The larger the farm, the higher their income support. The way these payments are allocated requires no proof of environmental benefits – everyone gets the same payment for each hectare of land. As a result, the very premise on which the majority of CAP support is paid is gravely flawed. In what was perhaps most surprising, we also found that substantial payments intended to support rural development are actually made to urban areas. Our August 2020 study found that 40% of CAP payments were misspent; they went to support incomes in the richest farming regions of the EU, which provide the fewest farm jobs. What reforms do you propose to ensure that the first modern objective of the CAP, supporting viable farm income and resilience, are actually met? What CAP reforms are needed to ensure that Member States actually deliver the European Commission targets of reducing greenhouse gas emissions 55% by 2030 and that the alarming decline in biodiversity is on a path to recovery by 2030? Rural development is a core objective of the CAP. Yet our August 2020 study found that €2.5 billion in rural development payments went to primarily urban areas. How do you propose ensuring that the CAP truly benefits rural communities?
  8. CAP income support should become needs-based, like other social welfare payments that are means-tested. That means recipients need to prove they need income support according to a particular criteria, considering all sources of income. Otherwise farmers should only be rewarded or compensated based on evidence of them providing public goods. This would give farmers in regions with lots of pollution the support they need to reduce it. It would also give farmers in less fertile regions income for providing environmental services, such as protecting grasslands high in biodiversity. These changes would drastically improve the current model of payments being based on how much farmland a person owns.
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