Study sees encouraging start to 2000-2006 Rural Development Regulation

Rural Europe, Wednesday June 7 2006

The EU's 2000-2006 Rural Development Regulation (RDR) made a promising start in many areas despite some delays in project implementation – but the various programmes suffered from a lack of coherence in some areas.

This was among the main conclusions of a new synthesis report, carried out by Agra CEAS Consulting, of all the mid-term evaluation reports of the relevant Regulation (1257/1999) which were carried out at regional and national level in 2003.

The synthesis report, completed last year, draws attention to areas where the old RDR, now in its last year of implementation, failed adequately to ensure efficiency and coherence in terms of execution and delivery of its stated objectives.

Potential lack of coherence

However, Agra CEAS noted that this potential for a lack of coherence between individual measures at the programme level has been clearly acknowledged by the Commission, and that this had been addressed in the new Regulation for the 2007-2013 programming period (1698/2005), which takes a more strategic approach to rural development.

According to the report, the definition of three core objectives within the new RDR, to be addressed by three main axes together with a LEADER axis, should transform rural development policy from a measure-led to an objective-led system.

As a consequence, it is likely to improve programme efficiency and internal coherence, and make it more likely that the overall policy objectives targeted within each programme will in fact be achieved.

Agenda 2000

The rural development policy reforms instigated by the Agenda 2000 package back in 1999 consolidated the previous nine legislative texts on rural development into a single regulation.

Although this made rural policy more coherent from a legislative point of view, the 2000-2006 RDR did not offer a 'new' menu of measures. The report considers that the menu remains to a degree an agglomeration of previously available and separately implemented measures, and that this reduces overall efficiency in terms of delivering outcomes and meeting objectives at the programme level.

This is the case particularly where the objectives, or at least the impacts, of individual measures are in conflict with one another.

That said, the report recognises that the choice of measures to offer in individual programmes is the responsibility of implementing authorities and it is incumbent upon them to ensure that the measures selected are appropriate to their rural development needs.

The study included an analysis of each of the nine individual policy areas within the 2000-06 RDR, as follows:

Chapter I: Investments on farm

There is strong evidence that supported investments contribute positively in terms of reducing production costs through the more efficient use of labour. Despite this, a positive impact on employment was also noted. Increased efficiency and increases in product quality have also resulted in positive impacts on income.

Chapter II: Young farmers

Support is designed to offset the costs of setting up, but the extent to which this is the case varies according to local and individual circumstances. However, there is evidence from a number of Member States (for example, Sweden, France, Germany and Austria) that some young farmers would have set up without support. The report notes that the available evidence with which to assess the performance of this measure is insufficient to conclude that it has a major impact on young farmers' decision to set up.

Chapter III: Training

The evidence suggests that there is a good match between training needs and assisted training courses offered, implying that training needs have been properly assessed in most cases. It is also reported that the training offered has had a positive impact in terms of employment conditions, usually through higher pay.

Chapter IV: Early retirement

There is only limited evidence that substantial transfers from older to younger farmers occur earlier than would be the case in the absence of the measure with doubts raised in particular in France, Germany and Spain. However, it is clear that farm size generally increases as a result of this measure. There is conflicting evidence on the extent to which the level of support offered is considered an appropriate incentive to take early retirement.

Chapter V: Less Favoured Areas

The extent to which compensation payments contribute to the aim of offsetting the economic implications of natural handicaps varies considerably, and there are wide disparities in the degree of compensation provided (and its relative importance in terms of the proportion of farm income provided), depending on region/Member State and the type (severity) of LFA.

The extent to which LFA policy has contributed to continued agricultural land use is not clear and is likely to vary with a greater impact in those areas where support makes up a higher proportion of income.

Where LFA policy contributes to land use, and where the agricultural sector plays a role in the maintenance of rural communities, then LFA policy can also be said to underpin these rural communities.

But while there are examples of under- or over-compensation, it is acknowledged that there has to be a trade-off between eliminating these and increasing administrative complexity and cost. The study says the long-standing criticisms of LFA policy relating to the essentially political, rather than handicap-driven, designation of LFAs remain.

Chapter VI: Agri-environment

The report notes that as environmental protection is a long-term issue, it is unlikely that impacts relating specifically to the 2000 to 2003 period (with which this evaluation was concerned) will be in evidence at this point in the implementation process.

There is however evidence for the widespread uptake of soil erosion measures where this is considered to be a problem, and measures to reduce the chemical contamination of soil are also widely adopted.

Large areas of the EU-15 are under agreements restricting the use of agricultural inputs and barriers to water transport mechanisms are also used. In combination, these measures are likely to have reduced the risk of water pollution, although it is not possible to accurately assess the impact that these different measures actually have.

The report notes that although the simple fact that there are large areas under agri-environment agreement should result in benefits to biodiversity, the actual impact depends on scheme design. Large areas of high nature-value land, such as Natura 2000 sites, are under agreements and are protected as a result. The report claims that although agri-environment payments are generally well-aligned with costs incurred and income foregone, there are examples where payment levels are either insufficient or excessive.

Chapter VII: Investments in processing and marketing

Although measures under this Chapter have made a positive difference in terms of competitiveness, mainly through improvements to and rationalisation of processing and marketing, the overall impact was often fairly small.

Positive impacts on the environment, health and welfare were reported, often as an indirect rather than a direct consequence of support. Increases in the supply of organic and other environmentally benign raw materials resulted from supported measures.

Chapter VIII: Forestry

The area under woodland in the EU-15 has increased as a result of supported investments, although plantings fell short of targets in most Member States. The carbon storage capacity of European forests between 2000 and 2012 is likely to increase by between 4 010 tonnes in Scotland and 2.9 million tonnes in Spain. Where the rationale for investments in forestry was economic, costs have generally been reduced and where the rationale was to provide environmental protection, this too has typically been realised. Impact on employment on-farm has tended to be small-scale and short-term in nature whilst impact on income has been neutral or marginally positive at this point in the programme.

Chapter IX: Adaptation and promotion of rural areas (Article 33)

Although it is too early in the implementation period - given delays in launching measures under this Chapter - to draw many conclusions, early indications are that there has been a positive impact in terms of living conditions and welfare of the rural population.

Whilst positive employment impacts have been noted on-farm, employment in the non-agricultural sector appears to be short-term and related mainly to infrastructure projects and village renewal.

Synthesis of Rural Development mid-term evaluations Lot 1 EAGGF Guarantee and Lot II EAGGF Guidance can be found on the European Commission website at http://ec.europa.eu/comm/agriculture/eval/reports/rdmidterm/lot1/fulltext.pdf

For more information please contact Dr. Dylan Bradley in the Wye office.

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