The new CAP reform has been promoted by its creators as being more target-oriented and better adjusted to what the public expects from the funds invested in agriculture. To meet these expectations and particularly to preserve as much funds for agriculture as possible, the first pillar direct payments have been veiled under various new support schemes. The most important ones are the basic payment scheme and its “greening” component. Let us focus on the basic payment, which will take up from 43 to 55 per cent of the direct payments envelope.
Politics trumps economics
The aim of the basic payment is unify the payments among the Member States and at the same time provide a kind of income support to agriculture. It could be understood as a single regional payment, i.e. a single payment per-hectare of all eligible areas in a region; the size of the region has not yet been defined, so far the condition was set at a minimum of 3 million inhabitants.… Read the rest