Opinion of the Economic and Social Committee on "Agri-environmental priorities for the multi-function agriculture of Agenda 2000"

(1999/C 368/20)

On 28 January 1999, the Economic and Social Committee, acting in accordance with Rule 23(3) of its Rules of Procedure, decided to draw up an opinion on "Agri-environmental priorities for the multi-function agriculture of Agenda 2000".

The Section for Agriculture, Rural Development and the Environment, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 28 September 1999. The rapporteur was Mr Colombo.

At its 367th plenary session (meeting of 20 and 21 October 1999), the Economic and Social Committee adopted the following opinion by 93 votes to one, with four abstentions.

1. Introduction

1.1. On 24 and 25 March 1999, at its Berlin summit, the European Council launched what it described as an "equitable and worthwhile reform of the Common Agriculture Policy. The content of this reform will ensure that agriculture is multifunctional, sustainable, competitive and spread throughout Europe, including regions with specific problems, that it is capable for maintaining the countryside, conserving nature and making a key contribution to the vitality of rural life, and that it responds to consumer concerns and demands as regards food quality and safety, environmental protection and the safeguarding of animal welfare".(1)

1.2. The reform is based, first and foremost, on Council regulation (EEC) No 2078/92(2), which was adopted as an accompanying measure to promote the dissemination of environmentally compatible farming practices and to compensate farmers for environmental conservation work. The regulation provides for the voluntary involvement of farmers by means of individual agreements offering financial incentives to meet specific technical and production-related requirements or develop certain natural resources within the farm. It has been the most important instrument to date in terms of integrating the environmental dimension into farming policies.

1.2.1. The most ground-breaking innovation introduced by the Agenda 2000 package and the new recently-adopted regulations concerns the establishment of a number of common rules for direct payments to farmers under CAP support schemes. The Member States are to adopt the environmental measures they deem to be appropriate, in accordance with specific farmland and production conditions. These measures may include aid in exchange for agri-environmental commitments or direct payments subject to fulfilment of compulsory general and specific environmental requirements. The Member States will have to decide on appropriate penalties reflecting the ecological consequences of failure to meet official uniform standards for good farming practice, defined nationally following consultation with professional farming organisations. They can reduce or even cancel support scheme payments if specific requirements are not met.

1.2.2. On this issue, the Committee refers to its opinion of 10 September 1998(3), and takes note of the series of decisions adopted on the subject, as well as the Commission Communication on "Directions towards sustainable agriculture"(4).

1.3. The Committee notes that in this respect, the reform is in line with its previous opinions, in particular its own-initiative opinion on the Contract between agriculture and society(5), adopted by an overwhelming majority on 14 September 1994.

1.4. Inspired by the Granada document(6) of November 1992, the Committee opinion highlighted the multiple functions performed by the Community's agriculture sector and named the key ingredients for a "contract" between farmers, the rural world and society in the European Union.

1.5. The opinion reiterated the position taken by the Committee in September 1988 in its two opinions on the Commission communications The future of rural society and Environment and agriculture(7); namely, that in the face of radical agricultural and social change in the EU's age-old rural settlements, farming must keep up its key role as the heartbeat of rural society, by satisfying basic public needs in terms of quantity and quality, and also by safeguarding nature and the environment.

1.6. The Committee was already arguing at that stage that farming/environment compatibility required effective guidelines for farm production and action to promote rural life, within a context of mutual understanding between farmers and the other sections of society, especially consumers.

1.7. This understanding between agriculture and society was to be grounded in a coherent rural development initiative, based on the multiple functions performed by the agriculture sector, and thus, in particular, its capacity to meet the public's productive, social and environmental requirements.

1.7.1. In essence, farmers have been asked to manage their land in a manner which as well as being efficient in production terms is also compatible with the conservation of rural and environmental values. New "services" will be provided by a competitive and economically viable farming sector which is also ecologically sound, using and protecting natural resources and safeguarding the capacity for renewal and ecological stability.

1.7.1.1. This is the meaning of "multi-function agriculture": an activity that goes far beyond food production pure and simple.

1.7.1.2. The concept of "multi-function agriculture" is based on the statement made by the Luxembourg European Council on 12-13 December 1997, according to which:

"The Union is determined to continue developing the present European model of agriculture while seeking greater internal and external competitiveness. European agriculture must, as an economic sector, be versatile, sustainable, competitive and spread throughout European territory, including regions with specific problems. The process of reform begun in 1992 should be continued, deepened, adapted and completed, extending it to Mediterranean production. The reform should lead to economically sound, viable solutions which are socially acceptable and make it possible to ensure fair income, to strike a fair balance between production sectors, producers and regions and to avoid distortion of competition.(8)"

1.7.1.3. A distinction must, however, be drawn between multi-function farming and multiple jobbing. The second covers diversification to non-farm activities (crafts, business or employed work). In this case, arable and livestock farming are just part of the occupational definition. This takes account of the view that rural development should be underpinned by an increase in non-farm activities and services, which generates additional or alternative sources of income, and is capable of reversing the trend towards rural depopulation, revitalising the economy and making country life more attractive.

1.7.1.4. Therefore, multi-function farming(9) requires new duties of farmers, in both traditional and innovative work, the all-round rationale being to develop the business, with due respect for any special tax, social security and pension arrangements laid down in national legislation.

1.8. In the Committee's opinion, for agri-environmental initiatives to succeed, a bond of solidarity must be forged between all sections of civil society in relation to agriculture, in contrast to traditional measures aimed solely at improving production structures and often seen as one more way of subsidising the primary sector at the tax payer's expense.

1.9. The Committee was therefore pleased to note that many of its views were shared; first, in the conclusions to the European conference on rural development held in Cork in November 1996, which identified sustainable rural development as an EU priority and cornerstone of all regional policy, in particular to stem the rural exodus and boost employment; and second, in the agriculture chapter of Agenda 2000(10), where, in setting out the European model for agriculture, the Commission recognised the major environmental role played by farming, by virtue of its having always been the most widespread form of land use.

1.9.1. While approving the approach taken by Agenda 2000, the Committee does not in any way wish to invalidate the general and sectoral critical assessment made in its various opinions on the agriculture chapter of Agenda 2000 and the individual proposals for COM reform contained in them(11).

1.10. Under Agenda 2000, income support policies will be increasingly dependent on the services farmers can offer the community, and the sector's competitiveness will be yoked to production techniques that protect natural resources, reduce and where possible prevent pollution, and generate quality produce.

1.10.1. In other words, while the once predominant demand for increased food production is receding, new farm activity openings are emerging for the general purpose of serving the common good, by means of environmentally-sound methods and improvements in product quality and individuality.

1.10.2. More importantly, provision has been made for aid to be allocated in exchange for agri-environmental commitments, marking a departure from the simple set-aside compensation system, towards incentives proportionate to the provision of practical land-conservation services.

1.10.3. The Committee would stress the need to prevent unfair distortions to competition rules, resulting from environmental obligations or draconian protection schemes, and limiting opportunities for normal profitable land-use. A series of good farming practice standards should be drawn up, listing the general and specific environmental conditions for direct payments required of farmers by the CAP reform.

1.10.4. In short, the CAP is evolving into a more refined policy aimed at the rural world as a whole - a world no longer to be considered as backward or less important, but in terms of the opportunities it provides to improve quality of life and use natural resources more sensibly and rationally.

1.11. In the light of the European Union's intention to use this approach more consistently and effectively than in the past to add value to farm work and activities that protect and steward the land, and to promote the wider dissemination of ecologically-sound production techniques, the present opinion is designed to pinpoint:

- the most pressing objectives for protecting rural areas, preventing harm to the environment and conserving natural resources, the upshot of which should be to secure economic activity and jobs, particularly in upland and other naturally disadvantaged areas, and thus give present and future generations a reason to stay on the land;

- priority measures for promoting high quality, traditional foods more effectively, to meet the standards which society demands of agriculture in terms of quality, safety, and environmental compatibility;

- the necessary incentives to sustain activities which protect the land and enhance the quality of European agriculture, coupling environmental protection with the need to bolster the efficiency of the Union's production system in the face of fiercer competition on the international markets.

2. The most pressing objectives for protecting rural areas, preventing harm to the environment and conserving natural resources

2.1. Preserving the land for farming

2.1.1. Against a backdrop of constant attacks on the countryside and regional identity, rural habitats are being invaded and compromised, with the danger that traditional river management and soil conservation systems will deteriorate.

2.1.2. The ongoing urban sprawl and siting of various types of development and their accompanying infrastructure in flourishing farming areas has contributed to the unravelling of the land-holding system and the urban conquest of the countryside, forcing the landscape through major change.

2.1.2.1. In the Committee's view, rural areas can no longer be treated as property reserves, but must become integral parts of a single land-use programme and influence the planning process at all levels. This means that the urban and construction planning permission authorities must remain faithful to the usual use and purpose of a given area.

2.1.3. The land degradation triggered by the closing down of numerous farms and the ensuing rural exodus from entire regions is just as grave a problem as pollution. The Committee, therefore, feels that it would be worthwhile promoting and providing appropriate support for a move towards "sustainable agriculture" in predominantly family-run farms, as a means of actively managing rural areas. Such farms should secure a satisfactory level and quality of output, while keeping the right ecological balance, and would help to preserve natural resources as unique and irreplaceable public assets.

2.1.3.1. Young people must be encouraged in entrepreneurial endeavours, focusing especially on the establishment and expansion of production units, applying special tax and credit provisions. At national level, special incentives should be granted for the establishment of cooperatives to meet demand for environmental services and improve conditions for processing and marketing products.

2.2. Specific measures for disadvantaged and upland areas

2.2.1. In view of the structural and environmental disparities between farming regions and the need to link environmental protection with the revitalisation of rural economies, the Committee is particularly concerned about areas which are disadvantaged or where farming is barely productive as a result of difficult physical conditions, and where there is very low population density or a trend towards depopulation (all common features of upland areas). In disadvantaged areas that are economically depressed in spite of having attractive scenery, state intervention to change social structures and redistribute income must focus on providing basic public services (schools, hospitals, transport) even when they are not strictly speaking economically viable, and on targeting investments and promoting the development of production initiatives that help to safeguard the environment, as the gradual changes it is undergoing are causing disastrous landslides, floods and other natural disturbances.

2.2.2. The Committee believes that, within the broader context of social solidarity, public action should be stepped up to encourage development in disadvantaged areas which are losing population, starting by recognising the central role played by farming in optimising these areas simply by virtue of its interaction with natural resources. The aim should be to set up viable farm businesses, using productive capacity to the full and supporting farming families by giving proper recognition to traditional values, in order to serve the common interest by nurturing a truly people-friendly and people-centred environment.

2.2.3. With regard to upland farming, schemes for certifying and adding value to typical agri-forestry products should be encouraged.

2.3. Making nature parks and reserves into multi-purpose assets

2.3.1. There is a trend towards protecting areas of regional importance for the purposes of nature conservation and the preservation of rural cultural values.

2.3.2. Having examined the complex relationships that hold the balance between natural resources, the Committee maintains that conserving areas does not necessarily mean never using them, but rather that the right conditions must be found for sustainable coexistence.

2.3.2.1. On these lines, the Committee takes the view that nature reserves and parks should be multi-purpose. They should not be seen as out of bounds or no-go areas for development programmes, but as special places for conducting research and, wherever possible, piloting methods that bring human life into harmony with the environment.

2.3.3. The Committee highlights the particular way in which these areas can serve other interests besides nature conservation, such as the economic development of local communities, through the promotion of appropriate forms of tourism and traditional farming, forestry and pastoral activities using sustainable methods.

2.4. Protecting biodiversity

2.4.1. In the face of the gradual erosion of genetic resources, species and the ecosystem, caused by a reduction in natural capacity for genetic improvement and by environmental damage, the Committee feels that the key to safeguarding biodiversity is to protect ecosystems and natural habitats and to keep species in their natural environments.

2.4.2. However, apart from defending ecosystems and animal and plant species, protecting biodiversity means achieving the critical goal of sustainable development, in accordance with models and processes that, in particular, allow time for resources to regenerate.

2.4.3. The Committee would stress that farming occupies an especially important position in this context and can make a vital contribution on two fronts. Firstly, it can help restore order in land-use, by combating the various forms of environmental decay. Secondly, it can help to maintain habitats and the interaction between ecosystems, with a view to the sustainable use of resources and a form of development which does not threaten animal or plant life.

2.4.4. A support strategy which respects biodiversity could bring the farming sector additional investments, generated by greater economic opportunities which provide increased value added, a wider range of products and a broader supply of services designed to maximise the natural environment and increase public access for leisure activities.

2.5. Recommended measures for rehabilitation and delivery of the full potential of development systems and regional services

2.5.1. In the Committee's view, the top priority is to stem the rural exodus and improve quality of life by promoting jobs, particularly in regions with high unemployment (upland and other naturally disadvantaged areas). This should be done by:

- establishing or upgrading administrative service networks to the standard required to provide information on farming, tourism and the hospitality business;

- conducting land conservation work, paying special attention to forests and applying specific measures for preventing and fighting forest fires and for river management;

- launching credit policies and simplifying red tape for setting up agricultural businesses specialising in traditional, high-quality products that are linked to the local culture and customs and are based on local plant systems and the natural diversity of the area;

- developing renewable energy sources, by investing in wind, solar and biomass energy production technology;

- investing in transport services, using multi-modal systems;

- promoting arable and livestock farming methods that maintain biodiversity.

2.5.2. At all events, the Committee takes the view that rural development policy should uphold the principle of subsidiarity, promoting the cultural heritage and traditions of rural communities as well as regional diversity.

2.5.3. Rural development is governed by specific local socio-economic and physical conditions and can thus require widely differing approaches. The model used must therefore fit in with normal production in the area concerned, placing an emphasis on enhancing the quality and individuality of local products, and using techniques that do not threaten the environment or animal welfare.

3. Priority measures for promoting high quality, speciality foods more effectively

3.1. Growing demand for natural products, leading to market competition based on product diversification rather than reduced production costs, should certainly create a favourable climate for local speciality products.

3.1.1. These products are opening up new opportunities for farmers to restore a more direct relationship with consumers, responding to their preferences and needs and playing a greater role in guaranteeing product authenticity.

3.1.2. Protecting the health and safety of operators and the public should be one of the prime objectives of suppliers of technology to farms.

3.1.2.1. Health and hygiene standards must be applied to protect public health, while bearing in mind that farming practice does not have to be exactly the same as that of industry.

3.2. High-quality products can generate a number of knock-on effects:

- output maximisation ceases to be the sole objective as value added for the final consumer and improved product quality come into play;

- support is given to the development of local systems, optimising the human and natural resources available in a given area, as well as local communities' deep-rooted traditions and customs;

- the agri-foods sector becomes more balanced as a whole, through the development of local activities centring on market niches that attract more sophisticated consumers;

- regional skills and know-how are preserved, by integrating local craft activities into multi-function farming;

- the foods produced are often tastier than mass-produced products.

3.3. High-quality farm products must, therefore, be a priority, in view of their positive impact as regards:

- consumer health and safety, and application of environmental health standards;

- product description matching product on the shelf;

- guaranteed constancy in basic characteristics;

- production techniques;

- protection of the environment via a reduction in the use of fertilisers and pesticides and the introduction of integrated farming systems;

- complementary activities (tourism, craft, commerce, etc.) generated at local level;

- reference to the local area.

As tax payers and consumers, the general public will appreciate the tangible benefits which these efforts will bring in the form of a better and healthier life style and diet.

3.3.1. By guaranteeing a product's geographical origin for the purposes of consumer information, speciality products can be marketed as being unique in terms of production cycle and local conditions, and as providing the consumer with better value.

3.3.1.1. It must be made clear that when there is a strong link with an area, product labels can refer to geographical origin and to special cultivation and production methods without carrying Community certification (PDO, PGI(12)).

3.3.1.2. The aim here is to develop the full potential of products from areas that outstretch the local or regional parameters generally used for the PDO or PGI, and that go beyond the concept of local specialities, by acknowledging their designation of origin or national trademark.

3.3.1.3. These products, destined for mass consumption via the major marketing channels, must however measure up to the quality implicit in their special characteristics, their geographical identity and the assurances given by the local agri-food sector.

3.3.1.4. The Committee believes that, in addition to keeping a major share of the value added within local communities, giving high-quality products a strong regional link also necessarily stimulates the development of associated economic sectors (tourism, arts and crafts), boosting local development through innovative and varied forms of investment (for quality, safety, and the environment).

3.4. The Committee's recommendations for developing natural resource conservation and management opportunities in tandem with complementary production initiatives

3.4.1. Against that background, producer organisations too are called upon to play a key role in promoting products, applying appropriate practices and techniques, establishing controls and maintaining standards, and raising awareness of the unique nature of the local product.

3.5. The Committee also maintains that local authorities can work with producer organisations to develop production activities that fit in with the objectives of protecting and managing natural resources; for instance:

- launching education (from primary school age) and training initiatives to revitalise local employment prospects;

- setting up support schemes tailored to local business and providing businesses with financial support;

- restoring local economic activity (traditional crafts and production techniques);

- tapping the potential for tourism by developing high quality local products linked to specific regional contexts;

- establishing marketing networks, outside the local production area, for speciality products, also using new technologies;

- pioneering employment policies to harness business services provided by farmers, for instance land rehabilitation and conservation.

4. Incentives needed to maintain land conservation work and boost production system efficiency

4.1. Redefining the technical objectives of the farm, switching the focus from quantity to quality, will involve acknowledging the range of goods and services that are linked to the specific features of arable and livestock farming, and forestry, especially where traditional forms of land use come into play.

4.2. The fact that farms are regionally widespread makes it essential to assess the vital contribution they make to safeguarding natural resources, and also to protecting and strengthening the social and commercial fabric of local economies.

4.3. Currently, the practical measures and financial backing directed at this aspect of farming are insufficient and ineffective.

4.3.1. An assessment has still to be made of the point at which environmental protection should cease to be a voluntary duty and become a paid service.

4.4. Only by recognising the multiple functions of agriculture will the relationship between the production process and the environment be definitively reversed. Meanwhile, natural resources must be treated as both environmental production factors and as public assets on which local well-being depends.

4.4.1. The result should be to promote a more balanced understanding of the boundaries governing the use of resources in production, while enhancing their productive capacity.

4.5. Effective state intervention is linked to the continuity of accompanying measures. Negative factors which have affected local application must be eliminated with a view to introducing environmentally sustainable practices and behaviour patterns. The new agricultural policy instruments must be implemented in their entirety, in order to develop new employment opportunities in rural areas.

4.5.1. Judging by experience so far, even if the current accompanying measures are continued with extra financial backing, they will have to counter the risk that:

- unless enough is done to correct the ecologically unbalanced use of natural resources in intensive farming, the resulting deterioration will be costly;

- the type and scale of incentives provided for marginal farming will not be enough to dissuade people from leaving the land.

4.5.2. On this issue, by recognising the decisive role played by farmers in protecting the environment and managing rural areas, the new system set up under Agenda 2000, which has now been adopted and transformed into a regulation, tops up the direct Community aid system and the moves to modernise farms and improve their economic viability.

4.6. The need to assess the external effects and make provisions to discourage the negative ones and promote the positive ones is also a central issue.

4.6.1. Among other measures, an integrated approach to rural development should help to boost income and employment. This presupposes a less rigid and sector-based approach to employment policy.

4.7. Possible initiatives include:

a) premiums for:

- protecting and developing stocks of wildlife species in danger of extinction

- restoring the countryside and the environment and improving public access

- reforesting and upkeep of the land for the purposes of fire prevention

- adapting livestock farming with a view to reducing its environmental impact while giving due consideration to animal welfare.

These premiums should be allocated on the basis of objective criteria and quantifiable results.

b) agreements with farmers to provide services for:

- environmental rehabilitation

- conservation of biodiversity

- land conservation and management

- water management and runoff control measures

c) support for regional and environmental protection

d) aid to encourage farmers to settle in farming areas and in upland and other naturally disadvantaged areas.

4.8. Support for negotiated policies could be particularly useful for the preservation of sites of high biological value, as the management of nature parks and reserves is largely determined by the farming policies that steer spatial development.

4.8.1. For multifunctional agriculture to come into its own, economic policy must, at the very least, take the following aspects into account:

a) protecting the social fabric and quality of life of the rural population;

b) differentiating management methods, on the basis of the real potential of each area;

c) striking a new balance between public and private interests in the management of natural resources;

d) evaluating external costs in company balance sheets.

5. A contract between agriculture and the public authorities to safeguard the environment

5.1. In the Committee's opinion, revamping the role of the farmer involves building up environment-related services and encouraging greater practical accountability, as part of an environmental management programme.

5.1.1. To this end, the Committee hopes that the authorities will draw up appropriate voluntary conventions with individual farmers or farming associations, for work or services relating to agricultural, forestry and rural environment conservation and management, water management, and environmental and countryside protection and development.

5.1.2. These conventions, entered into voluntarily, should specify the nature and purpose of the general regional conservation and management services to be provided, the length of the agreement, and the compensation to be paid by the authorities. To simplify and speed up the process, authorities should also be free to make direct payment arrangements for the provision of services, providing the work is on a reasonable scale and the compensation owed does not exceed a given threshold.

5.1.3. Furthermore, special attention should be paid to building up the know-how and skills of farmers, by raising professional standards. Rapid changes in market conditions and technology, and the development of new product types, require a real commitment to training, research and support in the interest of enabling green farming and effective stewardship of the land.

6. Conclusions

6.1. The Committee believes it can play a major role in assessing the sustainability of the results of the CAP reform in terms of optimising the competitiveness of farms and production. In any event, in practical terms the future of the sector must centre on steering through the current changes in market policy, with a view to achieving an integrated and sustainable European model for farming. The implementation of the new rural development measures should therefore be supported, with the adoption of new criteria for the allocation of public resources to respond to problems such as unemployment and rural decline. The aim should be to encourage a policy of providing infrastructural support for rural areas and farms, recovering the competitive edge of local products by playing the quality and local speciality cards, and boosting income levels by diversifying farm activities, with multi-functionality as the all-embracing goal.

6.2. The Committee offers this opinion as a set of guidelines, for examination in the light of the rural development programmes which Member States are to submit under the new Regulation (EEC) No 1257/1999. The agri-environmental indicators, requested by the Cardiff and Vienna European Councils with a view to mainstreaming environmental protection into all policies, will provide further important elements for evaluation. The "agriculture and environment" study carried out jointly by Eurostat and the Commission's Agriculture and Environment Directorates-General, was a useful preliminary exercise. The Committee hopes that there will be concrete results by the end of the year, in time for the Helsinki European Council.

Brussels, 20 October 1999.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI

(1) Berlin European Council 24/25 March 1999, Presidency conclusions. DN: DOC/99/1 of 26.3.1999.

(2) This subsequently became Regulation No. 1257/1999, in OJ L 160, 26.6.1999.

(3) OJ C 407, 28.12.1998. Opinion on direct support schemes/Agenda 2000.

(4) COM(1999) 22 final.

(5) OJ C 393, 31.12.1994, p. 86.

(6) The Granada Document contained the conclusions of the VIth Camerino Symposium on Community Rural Law held in Granada on 27/28.11.1992, led by specialists in rural and Community law and aimed at the European scientific community and the Community institutions. The full text is appended to the Committee Opinion on the contract between agriculture and society.

(7) COM(88) 501 final of 28.7.1988 and COM(88) 338 final of 8.6.1988. Opinions: OJ C 298, 27.11.1989, pp. 32 and 40. (future of rural society) (environment and agriculture).

(8) Luxembourg European Council - 12/13 December 1997 - Presidency Conclusions - DN: PRES 97/400 15.12.1997.

(9) For a more detailed definition of the concept of multifunction farming see the opinion on "A policy to consolidate the European agricultural model", Point 3.

(10) COM(97) 2000 final of 15.7.1997.

(11) OJ C 73, 9.3.1998, p. 71. Opinion on the agricultural aspects of the Commission's Communication - Agenda 2000; OJ C 284, 14.9.1998, p. 55. Opinion on the reform of the COM - cereals/Agenda 2000; OJ C 407, 28.12.1998, p. 196. Opinion on the reform of the COM - beef/Agenda 2000; Ibidem, p. 203 Opinion on the reform of the COM - milk/Agenda 2000; Ibidem, p. 208 Opinion on direct support schemes/Agenda 2000; Ibidem, p. 210 Opinion on the reform of the EAGGF/Agenda 2000; Ibidem, p. 221 Opinion on the financing of the CAP/Agenda 2000.

(12) PDO: protected designation of origin; PGI: protected geographical indication.