Reflections of CAP strategic planning in times of corona

We are pleased to welcome this guest post from Emil Erjavec, Professor of Agricultural Economics and Policy, University of Ljubljana, Slovenia.

The current pause in the ‘normal’ functioning of mankind and the European Union in general offers an opportunity to reconsider the functioning of institutions and design of public policies. The battle with the SARS-CoV-2 virus and its associated COVID-19 disease has brought to the forefront the importance of employing knowledge and an evidence-based approach as a basis for public decision-making.

It has also opened a window of opportunity to combat another illness, the prevalent political pragmatism and interest-based nature of policies in general and the Common Agricultural Policy in particular. This can be done by using a strategic approach to the policy with more rigour and genuine intent.

The adoption of regulations for the future CAP is awaiting the conclusion of the negotiations on the Multiannual Financial Framework. Before the corona lockdown, Member States’ governments were hard at work preparing drafts for the CAP Strategic Plans, the biggest modification to the new CAP, which is supposed to introduce into European agricultural policy a greater emphasis on societal (mainly environmental) issues and a much clearer intervention logic. While we cannot get a clear picture of the preparation of these documents across EU states, we can discern from available sources that they are the object of intense internal debates as well as dialogue among stakeholders.

Before the crescendo is reached in finalising the new round of reforms of agricultural policy, which will probably take place in the autumn or even next winter, a simple question presents itself: does strategic planning realistically enable a more efficient and effective agricultural policy? Or are we simply entering a new round of policy amendments, which only go as far as they must in order to preserve as much funding as possible with a minimal change in their distribution, which was the basic characteristic of all CAP reforms since 1984? 

The strategic approach that the new CAP is introducing, this time for both pillars, not just for rural development policy, demands more rationality, clarity and the best possible argumentation and definition of measures. Does this guarantee a better agricultural policy, one less reproachable and better adapted to the demands of modern society?

In this post, I posit that the conditions for a positive change in European agricultural policy do formally exist, but that there is a number of risks that will likely spoil these good intentions for most of the EU. There are growing fears that, instead of a positive shift, we will only get »quasi« strategic plans, which will merely repackage the current prevailing interests of agricultural policy somewhat.

The aim of the post is to address the pitfalls and risks that the current CAP reform faces. The risks are mainly related to the availability and quality of data and facts regarding the impacts of existing policy instruments, as well as the design and implementation of individual measures and their ability to realise set goals.  An additional hurdle in the way of a better CAP can be found in the weak administrative capacity for strategic planning and the deep entrenchment in particular interests, i.e. the political-economic framework of decision-making in agriculture.

One could dismissively say that it is politics, not policy, and that realistic strategic planning is not possible because of the political particularism inherent in agricultural policy. We must not accept such an excuse, especially not in times when we sit in isolation with the opportunity to observe society from some distance, reassessing its functioning in all its segments, from economy to ecology, and especially the role of the state and its institutions. Modern agricultural policy, which the CAP is introducing, is about solving real societal issues; these are real assets requiring thorough consideration and the elimination (or at least reduction) of existing disparities. 

Risk 1: Needs – a feeble grasp on the effects of measures and the needs for technological evolution

All strategic planning begins with the definition of needs. These stem from detailed situation analyses, the definition of societal demands and the knowledge of the effects of policy so far. They need to be put in a three-dimensional context: economy – environment – society, taking into account an incredible variety of states, various economic institutions, various form and size of economic entities engaged in farming, natural conditions, roles of agriculture and rural social conditions. The picture is not simple. There are as many pictures as there are critics and it is practically impossible not to make value judgments.

Some see small farms as an advantage, others see them as an inhibitor of progress. Some talk about the destruction of nature and the environment, others about linking agriculture with the environment to maximize benefits. Some emphasize the quality of local (national) food, while others see the same food as industrial and unsuitable. How do we define clear needs, if the debate is wrapped up in so much ideology, myths and a lack of facts? We cannot live without values, but if there is as much ideology as there is in agriculture, often with hidden agendas, then it is very hard to execute strategic planning, which is in principle rational and should be based on information and facts (evidence-based policy).

Additionally, in many cases, data sources on crucial subjects (e.g. income levels) have proven to be incomplete, inadequate or simply non-existent. Are we ready to accept the fact that the state of the availability and quality of data sources is not good enough and that in an important part of the areas of intervention it does not really allow for a clear definition of needs in the first place?

There is also a significant deficit in how well decision-makers understand and know the actual effects and impacts of the current policy. Understanding them is the condition for defining needs and potential for efficient and effective intervention.

Let us consider direct payments, the key agricultural policy measure, which will also remain in place in the following period. Agricultural policy does not have a simple answer on whether these payments, as they were conceived after 2003 (i.e. production-decoupled area-based payments), have a positive effect – and on which objective? Do they improve incomes? Yes, but for which producers? Do direct payments encourage the intensification of production and are they or are they not neutral in the sense of nature (biodiversity) conservation? Do they contribute to the preservation of the rural population and socially sustainable rural structures, or do they, to the contrary, accelerate change? The academic literature does have partial answers to these questions, but do the proposers and decision-makers of agricultural policy even know them, or rather, do they even consider them when deciding and insisting on such measures?

The lack, or poor quality, of data sources is a problem for most of the specific goals that the new CAP defines. We can observe the state of things through evaluation theory-based “context indicators”. A problem arises when we try to define clear functional connections between an individual measure and the goal that we are aiming for. In many areas there is a black box in between. With our understanding of actual causal relationships poorer; and with the state of data sources as it is, they are difficult to explain anyway. Not to mention that the situation is also affected by other factors, not only agricultural policy measures, and that the changes are slow and not necessarily connected to the policy programming period in which they manifest. We are making a policy whose effects we do not know well enough, as we lack the indicators and measurements to measure them with any satisfactory level of precision.

When defining needs, understanding the effects of food production technologies is particularly difficult. Which agricultural technologies are socially controversial, and which ones are desirable? Can the controversial ones receive even the most basic direct payments, will the decision-makers turn a blind eye? The definition of what sort of livestock production is still suitable in terms of sustainability is a big challenge. How do the prevailing practices affect the conservation of biodiversity and the climate crisis? Environmentalism wishes to preserve the agricultural landscape, which formed under different production and socio-economic conditions. Can it be sustained with »modern livestock production«? And if so, with what kind? What kind of animal husbandry practices should be supported, if many see all kinds as problematic?

A special challenge of strategic planning is also how to translate needs that may be expressed very clearly (a rise in income for specific groups of producers, reducing groundwater pollution, reducing the loss of natural species, increasing employment in the countryside), into quantified objectives and goals. The unwillingness of the decision-makers under pressure of farm lobby groups to come to clear goals and commitments is already strongly present and it will significantly limit the quality of strategic planning.

Quality strategic planning is also made harder by the choice of the fundamental method for defining needs, which is the SWOT analysis, which engenders generalizations and is not a tool that results in clear goal-setting. It is useful for a limited number of challenges, allowing for quickly assessing situations and effects of prior measures. But in the complexity of defining the needs of agricultural policy, it can quickly devolve into general and generic findings and, if looked at with some distance, seems more like a wish list rather than an actual basis for intervention.

The way that needs are defined is not beyond reproach, either. The CAP Strategic Plans will be made on one hand within the frame of the administration that is leading the process, , but it will to a great extent be informed by agricultural stakeholders with a very broad array of views and interests, and often a very poor grasp of the facts surrounding needs. A dialogue-based approach is of course necessary, but there is a danger of it degenerating into a cacophony of generalizations, simplifications and mere horse-trading between the interests of individual groups.

The fact of the matter is that the result cannot be anything else than a compromise between different interests, which, by its very nature, cannot lead to a clear definition of needs. There is need for somebody with the political will and muscle to cut through the noise and restore the discussion to the frame of facts and data. I doubt that the Commission will be able to do this, because its understanding of the real conditions in Member States is poor, and the Commission itself is also mired in interest politics and conflicts of jurisdiction (standing conflict between DG ENVI and DG AGRI).

Risk 2: Inaccuracy of goals and confinement to the productivist discourse and the redistribution of assets

If the problem of the definition of needs is understanding phenomena, a lack of specific data sources on the situation and effects of prior agricultural policy measures, then, for agricultural policy goals to be defined well, it will be essential to have objective planners able to connect quantified needs with a clear political vision. For there is a real danger (and unfortunately precedent in previous Commission texts) that Strategic Plans will be marked by fairly generic and empty concepts, which will not allow for a sufficiently clear definition of agricultural policy goals. Goals are undoubtedly value judgments that should be made in social dialogue and are the condition for rational action, but they can only meet this condition if the target is clear enough and equipped with data and facts.

Agricultural policy worldwide is namely full of goals that are not defined clearly enough and are based on likeable concepts with highly political connotations, such as food security, family farm, local food, food quality, rural development, agricultural competitiveness, small and young farmers, whose interpretation is very different and leaves too large a manoeuvring space for a clear choice of measures. With this low level of exactness and generic concepts, the link to data and quantified needs is often lost.

As a public policy, the CAP has never been able to clearly link needs and goals. A good example are all the justifications of agricultural policies after 2003. While the needs were still somewhat accurately expressed, then, on the level of goals, there is a quick shift to very general and likeable arguments. The current discussion, if we follow what is going on in the European Parliament and Council, does not give us hope that that same type of decision-makers (officials and politicians of agricultural ministries) will become more precise and will want more transparency of needs and goals. Expecting that the discussion will be better at the Member State level than it is in two key European bodies, is, of course, illusory for a large majority of Member States.

The vagueness of goals and principled statements of good intentions are understandable. The interests relevant to agriculture are so different, and the ideological conflict so strong, that this is the only possible (opportunistic) response of decision-makers. The conflict is mainly between the still dominant, in some parts of the EU even growing, productivist discourse, which clearly limits agricultural policy to food production. It is quite disconcerting to hear statements in the EU’s meeting rooms: “You’ll see, when famine strikes and you’ll have nothing to eat”. These are not voices of a few extremist farmers, these words are uttered by ministers, MEPs and even representatives of science.

Some of these voices have been especially vocal during the present corona crisis, heralding food shortages. Yet, regardless of the lockdowns, with the exception of post panic-buying binges, supermarket shelves are still stocked with food. The markets are still working and will continue to do so unless EU Member States succumb to fear-mongering and nationalistic tendencies and close off their borders, which would quite literally be a self-fulfilling prophecy.

The opposite pole, mainly environmental representatives, naturally uses an equally charged vocabulary with threats of the impact of changes on health and the planet. The fact is that conservationists defend their part of the discussion with more data and facts, but an aggressive approach does not enable any sort of dialogue, and forces farmers onto the streets (remember the protests in the Germany and Netherlands this winter), not into self-reflection as to what actually needs to be changed. The ideological conflict that we are witnessing in agricultural policy is contributing to policy being not more, but less accurate and strategic.

Is it possible, in such a climate of dialogue, to even bring about a rational and strategic policy? It would be very hard, if at all possible. Perhaps in the north and part of the west of the EU, where the discussion is less ideological and social awareness of the realistic challenges of agriculture is stronger. But in the EU South and East, we more often see the hostile looks of stakeholder groups barricaded into their viewpoints, which does not hold great promise for actual policy changes. And the main reason for this is the fact that the main purpose of agricultural policy is obviously still redistribution, i.e. the preservation of the flow of funds to existing beneficiaries.

Risk 3: Measures –defined in advance and with an unclear intervention logic

A special problem with defining Strategic Plans stems from the fact that most measures are defined in advance and that there is no clear intervention logic between goals and measures. The arsenal of measures that the European Commission has proposed, which will probably largely withstand the discussions in the Council and the European Parliament, is, with some amendments and modifications, practically the same as the one that Commissioner Fischler set over 15 years ago.

We can see some potential positive intended changes in the proposals to form a new  environmental architecture, such as the voluntary eco-scheme and enhanced environmental conditionality, but in essence it is a similar, if not nearly identical policy. We can see path dependency in action in the design of interventions, leading to a policy of small steps and stability which farmers welcome, but probably not to a more strategic orientation. And here lies one of the bigger problems of the proposed new CAP.  How to make agricultural policy more strategic using very similar measures? It is practically impossible, mainly because:

  • it is not precisely known what the effects of this policy are;
  • decision-makers will reach for more politically acceptable solutions, rather than strategically oriented ones;
  • the intervention logic of most measures is fairly weak in relation to the goals of agricultural policy.

It is especially the weakness of the intervention logic that is escalating the discussion on the strength and quality of the new strategic approach of agricultural policy. A serious discussion on the intervention logic of individual measures, as envisaged by the legislative proposal, reveals significant pitfalls. This is primarily tied to direct payments and their lack of specificity in terms of goals, but also to their particularly weak, indistinct, and often contestable logic. What is the real purpose of, say, the basic income payment? Obtaining income. For which groups of producers? Those with substantial capital and financial assets; definitely not for most producers. Is the basic payment just a risk management measure using a very expensive approach and weak logic? The environmental and conservational effects of direct payments are tied to environmental conditionality, and yet, there is good reason for doubt that there will be serious shifts in this field, at least in the majority of Member States.

Is the limited strength of intervention only a matter of direct payments? The EU has, namely, had an established strategic approach in rural development policy for quite some time. So how strategic is the decision-making and what are the effects of this CAP pillar? I claim that the same problems we are describing now for the new agricultural policy are discernible there as well: poorly defined needs, general goals, measures with a weak intervention logic. It is all more or less nicely wrapped, but what are the depth and quality of the intervention logics, and the actual effects at the aggregate level for key policy indicators? There are undoubtedly big differences between regions. There are undoubtedly also positive effects of such policy in individual cases, even significant shifts, not only at the level of individual agricultural economies, but also sectors and regions. And yet, overall, fundamental agricultural policy indicators expose the general inefficacy of policy measures.

The income situation of most agricultural holdings in the EU is poor, regardless of the vast funding dedicated to the sector and dependency on support – in most cases worse at the sectoral level compared to the economy average. The competitiveness of a large portion of holdings is weak, or rather limited to some areas, environmental and climate indicators speak for themselves, and rural depopulation and poverty are present in an important part of the EU. There is not much talk about the quality of strategic planning for rural development policy, honest objective scrutiny does not cast it in a good light, nor does it elicit optimism with regard to the uptake of strategic planning in the first pillar, which has even more general measures and an even weaker intervention logic.

Thus the CAP has a systemic flaw in defining the intervention logic of an important part of measures. They are either too general, have conflicting goals, or we do not even know what effects they have on key indicators of agricultural policy. Commission representatives will say, well naturally, that is why we have the Strategic Plans, so that Member States can do away with these anomalies and attempt to achieve as much as possible. And here’s the catch! How can we expect most Member States to be »better« than the European Commission with its proposals, if we know that in the »base« of agricultural policy we are under the direct influence of interests and rigid approaches? And if we cannot find a clear intervention logic for certain measures that will have to be preserved because of the political-economic reality (and will also occupy a large portion of budgets covered by the Strategic Plans), does this not already in advance relegate the ‘strategic-ness’ of the new CAP to a »quasi-«, perhaps even »fake« level?

Risk 4: A strategic approach – lack of internalisation and the need for improved human resources

Good strategic planning isn’t a bureaucratic process, but a highly intellectual and democratic activity. In the private sector, it is left to CEOs, with internal or external support, it is subject to coordination with owners and an internal »democratic« selling of ideas. But in public policies, we leave strategic planning mainly to officials at the national and European level and the processes of inclusive adoption, in which both poles of interest politics, the agricultural and conservationist, have a decisive role. Because of the nature of their work and ever more dominant populism in politics, key decision-makers are more just the transmitters of proposals prepared beforehand rather than actual strategic leaders which is quite a different situation than in the private sector. Because of the shortness of mandates and an informational asymmetry, they are also not responsible for key strategic decisions, as their political fate depends more on scandals, changes in the political arena etc. 

When communicating with European and national decision-makers (directly or through statements in the media), I cannot avoid the impression that strategic thinking and the understanding of its logic are basically still very much in their infancy, and an important part of key groups ignores them entirely. How many ministry representatives and key interest representatives of agriculture actually believe in the logic of needs-goals-measures, searching for the best solutions, achieving effects; in short, how many understand and, more importantly, believe in strategic planning?

There is clearly some systemic flaw in public strategic planning, and it is not merely a problem of agricultural policy. Quality strategic plans cannot be made in a way that does not entail harnessing the full potential of the state and in which key decision-makers do not have the task and political duty to implement real strategic shifts and search for the best possible solutions. If this is missing, and this is a characteristic that we can expect in the strategic planning of the new CAP, then strategic planning is merely a form of political and interest-based decision making. Because of the rigidity and complexity of the CAP, it will only lead to further searching for political compromises, tweaking prior decisions and allocation of funds. Objectively, this mentality and approach cannot but have an important (negative) impact on the quality of strategic planning. But the fact is that there are significant differences between Member States and their respective ministries in terms of willingness for change, which does not improve the assessment that in most cases the quality of the strategic approach will leave much to be desired.

The fact is that the current demands of society towards agriculture are incredibly complex. It is not easy to holistically implement economic, ecological and social elements of sustainability into thinking, decisions and programs. This is made even harder by the ghettoisation of the agricultural policy arena. An important part of the European official structures in agriculture sees its calling in serving agriculture, meaning existing technologies, relations, clients and a production orientation. It is difficult to dismantle such an approach and start thinking differently overnight. Shifts are happening and they are visible, but societal changes are outpacing the agricultural scene’s ability to form a more strategic agricultural policy. 

If we want actual changes, we should invest a great deal more into the management and development of human resources. In addition, they must be taught to coordinate difficult democratic processes and dialogue with different sides and, which would be hardest, leading decision-makers must be made responsible for the quality and output of strategic planning. This pertains to all levels, including the European Commission, where the previously hidden and now quite public conflict between DG AGRI and DG ENVI shows only the tip of the iceberg of the weakness of strategic planning. Strategic planning first needs to be believed in, then it must be well executed and its result should be the creation of quality documents. This requires excellent cadre, an increasingly rare asset in the EU’s and Member States’ agriculture administrations.

The human factor is thus the biggest threat to the quality of the Strategic Plans. This is where Member States will also differ significantly. It is also about how seriously they take social responsibility towards public assets and whether they understand the societal nature of agricultural policy. I believe, and I hope that I am wrong, that this entire soft part of the preparations for strategic planning was neglected, and that because of this we will have less progress in most of the EU, if any at all, in the quality and ‘strategic-ness’ of agricultural policy after 2022.

Are corrections possible or do we need to hold our horses?

The pessimistic tone in this post suggests that the CAP Strategic Plans will not bring about radical changes to the CAP. There are too many risks that multiply and decrease the possibility of us getting a better CAP. The good intentions of the CAP proposers, who definitely did not intentionally introduce a quasi-‘strategic-ness’ of the future CAP, will in their execution (and we are already seeing this) devolve into a political pragmatism of »small steps in the right direction«. Realists will say that this was the only possibility and that an overnight improvement of the CAP was not even to be expected. Politics is just the art of what is possible, and the CAP is a behemoth that cannot be transformed quickly. And this is my problem. We have been saying this since the MacSharry reform. Soon it will have been 30 years since the first serious amendment of the CAP. It truly is not what it was when it was first created and it does not deform markets as much, but how efficient is it really and does it bring socially desirable results?

Societal demands towards agriculture are changing faster than the policy itself, so that the divisions are once again increasing. But the main problem is that we are tearing down the logic of a correct approach with quasi-strategic planning. We have a policy of good intentions where fake elements, incompleteness, weaknesses and interests not only mar its image, but can also lead to absurdity and incessant and growing criticism. If we fail at applying the strategic principle as a fundamental principle of modern public policies, the European agricultural policy will be done a disservice. How will it be possible to continue justifying the CAP, its measures, scope and asset allocation, in the long run? This is where the agricultural policy arena is moving towards a very slippery slope. 

That is why we cannot be satisfied with only a partial shift and »small steps in the right direction«. The legislation has not been adopted yet and the Strategic Plans are still being made. That is why, in order for the shifts in the quality of agricultural policy to be bigger than seems to be their current potential, I believe the following is necessary at the EU level (including changes to the proposal, and especially additional efforts on the Commission’s part):

  • Strengthen data sources at the EU and national level and set actual goals by using indicators. Make sources mandatory and usable.
  • Define the level and quality of goal-setting (by using indicators). Propose a selection of goals.
  • Create guidelines of intervention logic for different types of measures and goals. 
  • Enable and encourage more flexibility in selecting and defining measures.  
  • Institutionally strengthen strategic planning at the EU- land Member State level by including a wide profile of experts and institutions (including research institutions). Strengthen training and education for strategic planning for all participants.
  • Ensure independent expert support and supervision of quality in strategic planning by employing independent licensed evaluators on the Commission’s part.
  • Democratise the preparation and adoption of Strategic Plans (not leave it solely in the domain of officials at the national and EU level).
  • Increase transparency of adoption and mutual exchange of information and experience between Member States.

The goal then is to reduce the servitude of agricultural policy to particular interests, raise the quality of strategic planning and enable democratic and professional supervision of Strategic Plans. All this sounds quite utopian and idealistic. But that is precisely what the EU needs most in these times of societal change, induced or perhaps only expedited by the coronavirus. If we take strategic planning seriously and not merely as a means to preserve the current state and power-relations in agriculture, then the CAP Strategic Plans can be a step towards increasing the policy’s societal relevance and generally improving EU public policies. The EU can’t afford quasi-strategic and fake planning anymore, neither in agriculture nor in any other area, if it wants to strengthen integration and not slip further into populism and political particularism.

Naïve as it may sound, one of the cures for the EU is also the implementation of an evidence-based approach and the ‘strategic-ness’ of public policies, which should solve actual problems and respond to societal changes. The first condition for realising this is improving the regulatory and factual frameworks for strategic planning, and the second condition is to then execute the Strategic Plans well. But first and foremost, the strategic approach needs to be understood and believed in. I have a feeling that this realisation is still very weak in the agricultural policy arena, at the EU as well as national level.

In a time when the coronavirus has slowed down our civilisation’s dynamism, we have time for self-reflection both individually and collectively and the thought comes to mind that it might therefore be better to restart from scratch – prepare a new reform proposal altogether.

However, the political process has likely already progressed too far and the only way to strengthen the quality of strategic planning is with the current proposal, leaving us to settle for the slow, incremental turning of the behemoth that is the CAP, and simply hope that it does not crumble into 27 separate policies in the process.

This post was written by Emil Erjavec.

Private photo by Emil Erjavec.

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1 Reply to “Reflections of CAP strategic planning in times of corona”

  1. Very much appreciated this critical article! While activists take the current crisis as an opportunity to position ideology as evidence, the questions that are raised in this article are highly relevant. No doubt, we need to emphasize that data and scientific evidence should feed the policy reforms.
    In Belgium, we wrote with some colleagues at the University of Leuven a short opinion paper, framing the current ‘glorification’ of local food. https://blog.associatie.kuleuven.be/tessaavermaete/why-local-farming-and-your-own-garden-fail-to-feed-the-country/
    Your article goes for sure way broader, and inspires our work for our ongoing interdisciplinary think-thank on food and farming at our university.

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