The term public goods first entered into the CAP debate in 2007 when it was used in an agricultural context by the environmental NGOs. Since then it has gradually infiltrated the mainstream policy debate appearing in many papers and speeches from research papers to the highest level of decision making. The need for securing mainly environmental public goods in the future CAP is echoed by an increasing number of stakeholders, rallying behind the slogan of “Public Money for Public Goods”, developed by Zahrnt (2009). Becoming the primary focus, the concept is now used more generally to refer to any sort of public benefit from agriculture, thereby justifying the need for public support, as expressed by various stakeholders.
Now it seems that the Commission wants to link the provision of public goods to direct payments by greening the first pillar which would represent a very important innovation in the history of the CAP. By using the wording of the Commission, this green payment will be paid for “compulsory practices to be followed by farmers addressing both climate and environment policy goals” under the form of “simple, generalised, non-contractual and annual actions that go beyond cross-compliance”. The latest proposals mention three conditions (three different crops on arable land, the maintenance of permanent grassland and a 7% of the area devoted to ecological focus) as requirements of receiving “greened” direct payments.
However, this idea has many caveats. First, as discussed in a previous post, it seems that this idea actually means a reintroduction of the set-aside programme abolished in 2008. Second, it also seems that we are now faced with a super-cross-compliance (by using the wording of Alan Matthews) as farmers opting even for the basic payment must also meet these new requirements. This raises several other questions well discussed in the debate evolving around Ulrich Koester’s previous post.
What I see as the main problem with this proposal is that it neglects the fact that we cannot measure the value of public goods properly. It is apparent that we can only make educated guesses about the value of a landscape or the value of biodiversity. As a result, any estimates will be subject to ongoing contest and dispute and it is unclear how the Commission proposes to deal with these problems. There is no meaningful common value for public goods throughout Europe. There is no reason to suppose that the same public goods policy should apply to Established and New Member States, still less for each and every region or farm. Moreover, without knowing the proper indicators and measurement methodology, the efficiency of the delivery of environmental public goods can hardly be evident. Questions arise as to who will evaluate (and on what basis) whether public money spent on the provision of public goods has led to the achievement of the policy’s aims or not. Going further, if we cannot measure the outcome, it is impossible for taxpayers to understand exactly what they are paying for.
What might be a solution is the support of already existing private programmes. This might take the form of tax-deductable private donations for non-profit organisations or public money given to validated environmental organisations based on the number of members. This would let the general public put their money where their mouths are and would also cultivate some competitive provision of public goods. Competition between such organisations for support from the general public and from the states would be much better, at least as I suggest, than compliance and set-aside based instruments.