TABLE OF CONTENTS GLOSSARY GLOSSARY OF REFERENCED RURAL-DEVELOPMENT MEASURES 1. INTRODUCTION 2. BACKGROUND TO THE INTERVENTION 2.1. Description of the intervention and its objectives 2.2. Points of comparison 3. IMPLEMENTATION/STATE OF PLAY 3.1. CAP Pillar I 3.2. CAP Pillar II 4. METHOD 4.1. Short description of methodology. 4.2. Limitations and robustness of findings. 5. ANALYSIS AND ANSWERS TO THE EVALUATION QUESTIONS 5.1. Effectiveness 5.2. Efficiency 5.3. Coherence 5.4. Relevance

5.5. EU added value 5.6. Non-agricultural generational renewal in rural areas 6. CONCLUSIONS ANNEX 1: PROCEDURAL INFORMATION ANNEX 2: STAKEHOLDER CONSULTATION ANNEX 3: METHODS AND ANALYTICAL MODELS ANNEX 4: CURRENT INTERVENTION LOGIC FOR INSTRUMENTS AND MEASURES AFFECTING GENERATIONAL RENEWAL ANNEX 5: VIEWS FROM OTHER INSTITUTIONS ANNEX 6: SOME MEMBER-STATE MEASURES IN THE AREA OF GENERATIONAL RENEWAL GLOSSARY Term or acronym Meaning or definition CAP Common agricultural policy CGE Computable general equilibrium (type of econometric model) CMEF Common monitoring and evaluation framework EAFRD European Agricultural Fund for Rural Development EAGF European Agricultural Guarantee Fund EIB European Investment Bank ENRD European network for rural development EU European Union FADN Farm accounting data network GAEC Groupement Agricole d’Exploitation en Commun (Joint Farming Group) NUTS Nomenclature of territorial units for statistics RDPs Rural development programmes SAFER Société d’aménagement foncier et d’établissement rural (Land development and rural establishment company) SFS Small farmers scheme GLOSSARY OF REFERENCED RURAL-DEVELOPMENT MEASURES Term Meaning M01 Measure 1: Knowledge transfer and information actions M02 Measure 2: Advisory services, farm management and farm-relief services M04 Measure 4: Investment in physical assets M04.1 Sub-measure 4.1: Support to improve the overall performance and sustainability of an agricultural holding M04.2 Sub-measure 4.2: Support for the processing, marketing and/or development of agricultural products M04.3 Sub-measure 4.3: Support for infrastructure related to the development, adaptation or modernisation of agriculture or forestry, including: (i) access to farm and forest land; (ii) land consolidation and improvement; and (iii) the supply and saving of energy and water M04.4 Sub-measure 4.4: Support for non-productive investments linked to the provision of agri-environmental climate objectives M06 Measure 6: Farm & business development M06.1 Sub-measure 6.1: Business start-up aid for young farmers M06.2 Sub-measure 6.2: Start-up aid for non-farm rural businesses M06.3 Sub-measure 6.3: Small-farm business development M06.4 Sub-measure 6.4: Creation and development of non-farm businesses M06.5 Sub-measure 6.5: Small-farmers’ transfer scheme M07 Measure 7: Basic services and village renewal in rural areas M08 Measure 8: Investments in forest areas M10 Measure 10: Agri-environment and climate M11 Measure 11: Organic farming M13 Measure 13: Areas facing natural constraints M16 Measure 16: Cooperation M19 Measure 19: LEADER M113 Measure 113: Early retirement (2007-2013) 1.INTRODUCTION The age structure of European farmers is such that for every farm manager under 40 in 2016, there were three farm managers over 65. The ageing of the farming population is one of the top challenges facing rural areas in the European Union (EU). Many farms may have no successors, and farm demographics accentuate the risks of concentration in land use. In addition, the agricultural sector is increasingly in need of skilled hired labour. This labour is essential to make EU farming: (i) more sustainable; (ii) able to adapt; and (iii) able to contribute to climate action in the context of a major technological shift. Moreover, many potential entrants to farming are deterred by what they view as the poor quality of life that farming offers. This is the case for farm successors as well as hired workers. To make agriculture more attractive, policy objectives should address the social image of farming and revitalise rural areas. In 2017, the European Court of Auditors published a special report on generational renewal (bringing young people into agriculture to replace the retiring generation) entitled EU support to young farmers should be better targeted to foster effective generational renewal. The report focused on the common agricultural policy’s (CAP) young-farmers’ measures. After the publication of this report, the European Commission decided to evaluate the impact of the CAP on generational renewal, local development, and jobs in rural areas. The purpose of the evaluation is to assess whether the instruments offered by the CAP are appropriate and sufficiently used to address the concerns of young farmers and the issue of generational renewal. The evaluation examines all evaluation criteria, i.e. the effectiveness, efficiency, relevance, coherence and EU added value of CAP measures to support generational renewal in rural areas. The evaluation has a strong focus on farming. On scope, the evaluation focuses on the following three main areas.

-CAP measures directly targeted at generational renewal in farming: odirect-payment support to young farmers (Chapter 5 of Title III of Regulation (EU) 1307/2013); osupport to business start-ups for young farmers (Article 19.1 of Regulation (EU) 1305/2013 (the Rural Development Regulation)); oearly retirement of farmers (Chapter 1 of Title IV of the Council Regulation (EC) No 1698/2005). -CAP measures with an indirect impact on generational renewal in farming: oother direct payments (Title III of Regulation (EU) 1307/2013); ocooperation (Article 35 of Regulation (EU) 1305/2013); oinvestment support (Articles 17, 21, 25, 26, 45 and 46 of Regulation (EU) 1305/2013); oknowledge transfer and information actions (Article 14 of Regulation (EU) 1305/2013); oadvisory services, farm management and farm-relief services (Article 15 of Regulation (EU) 1305/2013). -To a lesser extent, CAP measures not directed at farming but that: (i) are linked to local development, growth and jobs in rural areas; and (ii) seek to make rural areas more vital and attractive for the younger generation: obusiness development in rural areas (Article 19 of Regulation (EU) 1305/2013); oinvestments (Article 17 of Regulation (EU) 1305/2013); oLEADER (Articles 42-44 of Regulation (EU) 1305/2013); obasic services and village renewal in rural areas (Article 20 of Regulation (EU) 1305/2013). The geographical coverage of the evaluation encompasses the EU of 28 Member States, including the UK, as it was a Member State when the evaluation was carried out (from December 2018 to November 2019). The examination period of the evaluation covers the period following the implementation of the 2013 CAP reform (2014-2020). This Commission staff working document is primarily based on the corresponding external evaluation support study but also draws selectively from additional analysis, as well as complementary data from various sources. In the subsequent chapters, any reference to analyses, interviews, findings, etc. should be interpreted as coming from the support study, unless otherwise indicated and referenced. 2.BACKGROUND TO THE INTERVENTION

The proportion of farm managers under 40 is low in most European countries (11% in 2016 in the EU), while almost a third of farm managers are aged 65 years or more. Over the last decade, the proportion of young farmers in the overall farming population declined, while that of older farmers (above 40) increased. Farm demographics have been recognised as an important driver of structural change in European agriculture. While this reflects to a certain extent the general ageing of rural societies, it is also linked to the slow inter-generational transfer of farms. Furthermore, the oldest farmers have the smallest farms: the average size of younger farmers’ farm is slightly more than 2.5 times bigger than the average older farmer’s farm. The proportion of young farmers thus cannot be expected to grow as quickly as the proportional decline in older farmers. Young farmers in the EU are characterised by: ·a low proportion in total farm numbers, agricultural land and standard output; ·average-sized farms; ·higher levels of professional qualification than older farmers; ·below-average income levels; ·low capital stocks and levels of land ownership; ·high levels of net investment; ·below-average levels of liabilities; ·high return-on-assets ratios. At the beginning of their farming careers, these young farmers are thus positioning their farms for the future, but they may be constrained by a lack of access to land and credit. 2.1.Description of the intervention and its objectives The CAP’s goals as enshrined in the Treaty of Rome (1957) acknowledge the challenge to support ‘a fair standard of living’ for farmers. The focus of market management in the first decade of the CAP (1962-1972) was predominantly on creating the conditions necessary to attract investment and promote modernisation and mechanisation in farming. This aimed at driving economies of scale and increasing labour productivity (and thus increasing the outflow of workers away from agriculture). In this context, generational renewal was not a significant focus for policy attention. Explicit policy measures to support young farmers under the age of 40 were first introduced to the CAP in Council Directive 81/528/EEC on the modernisation of farms. Conceived as aids to modernisation and productivity, the use of these measures expanded and became linked to broader rural development within regionally-targeted programmes (notably Objective 5b) in 1994-1999. Since then, with the Cork Declaration (1996) and Agenda 2000 reforms, the CAP has increased its focus on generational renewal and rural vitality. After 2000, the CAP diversified its structure and focus with the introduction of two ‘pillars’. The CAP has thus offered instruments and measures of greater range and complexity. These instruments and measures are designed to promote: (i) rural economic diversification and development; and (ii) rural ‘quality of life’ through better services, better infrastructure, and new opportunities for employment. As part of this more comprehensive approach, generational renewal both within and beyond agriculture has been a focus of policy support in many Member States and regions. The creation of an obligatory supplement for young farmers within the direct-payments provisions from 2015 affirmed a commitment to fostering generational renewal in agriculture. This supplement addresses the specific needs of younger farmers who have a lower income: in 2012-2016, EU farmers under 40 had on average 20% lower income than farmers aged 40 and older. Note: Farm net value added/annual working unit.

Source: DG Agriculture and Rural Development, based on Farm Accountancy Data Network.

For the payment to young farmers, national authorities must: ·set aside up to 2% of their total funding under the direct-payments envelope; ·decide on the number of hectares per farm to be supported under the young-farmers payment (up to 90 ha); ·choose a calculation method (e.g. setting the payment level at some percentage of farmers’ income-support payments – up to a maximum level of 50%); ·decide whether the beneficiaries of the young-farmers payment should have appropriate skills and/or fulfil certain training requirements; ·grant the young-farmers payment for a period of 5 years after choosing the eligible young farmers. In addition to the above, Member States that operate the basic-payment scheme with payment entitlements must also give priority to young farmers to receive basic-payment entitlements from the national/regional reserve. In addition to Pillar I, rural development programmes (under Pillar II) provide additional measures to help young farmers get started. These Pillar II measures fall under Focus area 2B, designed to facilitate the entry of appropriately skilled farmers (in particular young people) into agriculture. This support can include advice or grants, loans and guarantees designed to help the development of rural businesses. Some newly introduced elements in the 2013 CAP reform are: ·business start-up aid for young farmers granted on the basis of a business plan (eligible for an EU contribution of up to EUR 70 000); ·a 20% higher level of support for investments in physical assets; ·an obligation for the farm-advisory services to provide specific advice to farmers setting up for the first time. The support to business start-ups in rural areas (outside farming) is also analysed in this evaluation. Between 1992 and 2013, there has been a measure in place to support the early retirement of farmers and farm workers. Early retirement from farming ought to: (i) help young farmers to start off in farming; or (ii) increase the average farm size. It could help provide a fair standard of living to farmers, as a reasonable complement to their pensions, giving them some incentive to transfer the land to younger generations. However, this measure was discontinued in the current programming period, as it was not suited to older farmers’ specific needs. This fact led to significant differences in the implementation of this measure (it was mainly implemented in Poland). In addition, the measure was criticised (including by the European Court of Auditors) for being cost-inefficient. The early-retirement scheme was nevertheless included as a transitional measure in the programming period 2014-2020, so that farmers who applied for the scheme in the former programming periods could still get paid. Pillar II also supports the ‘human capacity building’ of farmers and non-farmers. ‘Human capacity building’ covers the passing on of knowledge, training, advice, cooperation and business planning to attract a new generation of business leaders into the farming sector. Aid targeted at rural business start-ups and farm diversification can offer farmers and other young people in rural areas new opportunities: (i) opportunities to increase their incomes; (ii) opportunities to provide greater value added and/or resilience to their businesses; and (iii) job opportunities for other family members or rural residents. Under priority 6 (to promote social inclusion, poverty reduction and economic development in rural areas), Pillar II investments in rural infrastructure aim to improve basic rural services and stimulate village-level renewal (both social and economic renewal). Local initiatives (such as LEADER) also directly help to improve: (i) rural economic growth; (ii) rural job creation; and (iii) rural quality of life. Indirectly, these initiatives help to maintain rural population levels and community spirit. Help to install broadband in rural areas is also essential for generational renewal and rural businesses. Other measures may also be relevant in specific local or regional circumstances. After the 2013 CAP reform, financial instruments (loans and/or guarantee funds) were made more widely available to farmers. These instruments were also used by Member States to address young farmers’ difficulties in accessing finance for their investment plans. These financial instruments (on their own or combined with grants) provide an important possibility for young farmers to access funding under more attractive conditions than the financing offered by the market. The instruments are also available for working-capital finance and for land purchase. These financial instruments also have fewer eligibility restrictions and allow investments in areas such as animals and annual crops. Joint initiatives with the European Investment Bank (EIB) have enriched the spectrum of support offered by the CAP through the ‘young-farmers’ initiative’. This initiative brings together loans available through the European Agricultural Fund for Rural Development (EAFRD) and the expertise of the EIB for a total amount of EUR 1 billion. These loans are managed by local banks and leasing companies operating across the EU. A minimum of 10% of the amount lent to participating banks must be dedicated to farmers under 41 years old, who will benefit from competitive financing terms. Intervention logic The figure below illustrates a specific intervention logic for generational renewal under the CAP, showing the linkages between: (i) relevant measures; (ii) specific objectives in rural development (priorities and focus areas); and (iii) CAP strategic goals contributing to generational renewal. Out of the three CAP goals, the goal on achieving balanced territorial development can be identified as the overarching objective for generational renewal. In addition to this overarching objective, there are also specific objectives that are relevant for achieving generational renewal: (i) maintaining a diverse agriculture across the EU; (ii) social inclusion; (iii) poverty reduction; (iv) rural economic development; (v) greater competitiveness; and (vi) ensuring farm viability. The implicit goal of these specific objectives is to retain/increase the number and share of young people in rural areas.

The most prominent, direct measures for agricultural generational renewal in farming aim to bolster the economic viability of farm holdings managed by young farmers (whether they be successors or new entrants). These direct measures include: (i) the young-farmers’ supplement under Pillar I; (ii) support under Pillar II for young-farmers’ business start-ups; (iii) investment support under Pillar II (with a higher rate of EU co-financing); (iv) training under Pillar II; and (v) advisory services under Pillar II. Through these interventions, the ‘pull factor’ of leaving the sector to enter other economic sectors within or outside rural areas should be counterbalanced. The Pillar II cooperation and innovation measures (as well as investments in other rural business start-ups and other sectors such as forestry, tourism and heritage) aim to enlarge the economic base by supporting the growth and coordination of several sectors (along the agricultural value chain, but also outside of it). These interventions may lead to a more balanced and resilient sectoral mix, and may thus promote generational renewal by increasing the economic attractiveness of rural areas. Support for basic services and infrastructure (including information and communication technologies) makes regions more attractive and improves settlement in rural areas. It also addresses generational renewal by increasing the quality of life and knowledge base, and providing employment. This increases opportunities and improves the quality of services. This in turn strengthens the basis for: (i) general economic services (a prerequisite for sufficient income and improved working conditions); and (ii) easier social ties and networks. The impact of CAP measures on generational renewal depends critically on national or regional choices about the design and delivery of the measures at national and local level. In their rural development programmes, Member States have set targets (and accompanying indicators) for 2023, reflecting the targeted coverage of measures. These indicators will be used to monitor the progress of Member States in the implementation of the planned measures. If the CAP is not the main instrument of support, the targets might be small. For example, these smaller targets could be the number of jobs created or a certain percentage of the rural population gaining access to information communication technologies by means of the CAP. The impacts of CAP measures also depend on how these impacts interact with the underlying context of each area, including national policy instruments and measures. For example, fiscal policies to promote or prevent easy inter-generational transfer of farmland or businesses directly affect the pace of generational renewal. Demand for land for non-farm uses and/or spatial-planning policies influence the relative attraction of inter-generational transfer. CAP instruments operate alongside the strong influence of: (i) market conditions and trends; (ii) governance and regulatory frameworks; and (iii) the shifting expectations and capabilities of people and communities. More detail on the logic of the measures and instruments can be found in Annex 4. 2.2.Points of comparison To better analyse the success of the generational-renewal measures, the contractor who carried-out the support study hypothesised a counterfactual situation with no generational-renewal measures. It allowed seeing what outcomes were the result of generational-renewal measures and what outcomes would have taken place without these measures in place. In the counterfactual situation, the farms did not receive any support for young farmers. The comparison period was the first half of the 2014-2020 programming period (between 2013 and 2016) for two Member States, France and Italy. A ‘difference-in-difference’ analysis of farms was made after matching similar farms: those receiving the young-farmer payment and those others not receiving it. The objective of this analysis was to compare the difference between the pre-generational-change and post-generational-change situations of the two groups of farms (with and without support). This comparison was carried out across several characteristics: (i) the main structural and economic characteristics; (ii) labour use; (iii) type of farming; (iv) investment intensity; and (v) economic performance. In addition, the impact of CAP measures on generational renewal was estimated by using ‘common general equilibrium’ modelling work on Polish data. This modelling work was used to assess: (i) whether jobs were created or sustained directly in the agricultural sector; (ii) what scale of multiplier effects these measures had on employment in other sectors; and (iii) how these jobs contributed more broadly to the development of rural areas. 3.IMPLEMENTATION/STATE OF PLAY 1.1.CAP Pillar I The mandatory young-farmer payment available under Pillar I gives enhanced income support to newly established young farmers during their initial setting-up period (a period of 5 years). In general, this period is characterised by greater income risk and greater need for investment. Direct payments constitute the largest area of expenditure in the CAP (73%) amounting to EUR 41.3 billion in 2018. The young-farmers’ payment in the EU accounted for an average of 1.3% of this EUR 41.3 billion, below the maximum 2% ceiling. However, when looking at all direct payments received by beneficiaries of the young-farmers’ payment, these represented about 8% of direct-payments expenditure. The number of beneficiaries in claim year 2018 for the young-farmers’ payment was close to 464 000 young farmers, or 7.5% of direct-payment applicants in the EU-28. Details on the young-farmer payment The young-farmer payment targets farmers of no more than 40 years of age who: (i) are setting up for the first time an agricultural holding as head of the holding; or (ii) have already set up such a holding during the 5 years preceding their first application for the young-farmer payment. The scheme is compulsory for all Member States. The payment, which is additional to other direct payments, is limited to a maximum period of 5 years. The changes that entered into force in 2018, with the so-called Omnibus Regulation, improved the design of the young-farmer payment. These changes gave Member States the possibility to increase the level of the young-farmer payment. Denmark, Spain, Estonia, France, Italy and Finland significantly increased the payment level. As a consequence, the EU average young farmers payment increased from less than EUR 1 700 per beneficiary in 2017 to almost EUR 2 000 in 2018. This led to a significant increase in the share of the young-farmers’ payment in direct payments, from 0.8% in 2015 to 1.3% in 2018. This share is now closer to Member States’ initial estimates. Some Member States (such as Czechia, Lithuania, Luxembourg, Finland, Hungary, Poland and Slovenia) exceeded their initial estimates – in some cases by a significant amount. In addition, starting in claim year 2018, the payment for young farmers must be granted for a period of 5 years, if the young farmer applies for the payment within the 5 years following his/her first setting-up. In practical terms, this means that the number of years elapsed between the first setting up and the first application for the young-farmer payment will no longer be deducted. These improvements partly explain the increase of about 13% in the number of beneficiaries since 2017.

Source: DG Agriculture and Rural Development, based on the Audit database. In claim year 2018, the beneficiaries under the young-farmer payment scheme as a share of total beneficiaries within that country was the highest in Czechia (17.2%), followed by the Netherlands (16.5%), Austria (12.3%) and Germany (12.2%). It shows an upward trend in almost all Member States and is above 6% in most Member States. By contrast, the share of beneficiaries of the young-farmers’ payment was below 3% in Cyprus, Spain, Malta and Portugal. The possibility for young farmers to receive payment entitlements from the reserve Member States, which apply the basic payment scheme with payment entitlements, are obliged to allocate payment entitlements from the national/regional reserve to young farmers and to farmers starting their agricultural activity (so-called new entrants). In 2018, around 40 000 farmers entered the basic payment scheme via the reserve (representing nearly 1.2% of all beneficiaries of the basic payment scheme), of which close to 18 700 were young farmers. In 2018, the highest shares of young farmers among the farmers ‘entering’ the basic payment scheme via the reserve were from Belgium (96%), Ireland (91%), Malta (84%), Luxembourg (77%) and Spain (71%). Taking into account all allocations from the reserve, the share of allocations in claim year 2018 (as a proportion of EU level allocation) consisted of 54% young farmers, 25% ‘new entrants’ and 11% from the other categories of farmers. Source: DG Agriculture and Rural Development, based on Member States’ notifications. 3.1.CAP Pillar II Under Pillar II, support for business start-ups helps young farmers to set up and structurally adjust their holdings by providing cash flow and financial security during the first 5 years of farming. The support is conditional on correctly implementing a business plan and meeting minimum requirements in training and skill acquisition. From the rural development envelope of EUR 100 billion for 2014-2020, 7% is allocated under Focus area 2B to facilitate generational renewal and the entry of appropriately skilled farmers to the agricultural sector. This expenditure is allocated as follows: (i) EUR 5.4 billion for installation grants (sub-measure 6.1) ; (ii) EUR 1.2 billion for investments; (iii) EUR 185 million for training, information and advisory services; and (iv) EUR 18 million for cooperation. In addition, more than EUR 1.4 billion is programmed for start-up aid for non-farm rural businesses (sub-measure 6.2) and for small-farm business development (sub-measure 6.3). For the programming period 2014-2020, the Commission plans to support 176 000 young farmers with a start-up grant. Installation grants have been introduced in 75% of rural-development programmes. By the end of 2019, more than 127 000 young farmers (or 72% of the above-mentioned target) had already benefited from this support. This represents close to 1% of all EU agricultural holdings in 2016. Moreover, about 30% of the supported young farmers were women. At the beginning of the programming period, Member States set targets for the percentage of agricultural holdings with supported business development plans/investments for young farmers. This target was 1.5% for the EU-28 in 2023. It was around 7% in France and Luxembourg, but less than 1% in Romania, the UK, Latvia, Croatia, Hungary, Bulgaria, Malta, Lithuania and Sweden. On implementation, there was also great variation in the percentage of agricultural holdings with supported business development plans/investments for young farmers (Focus area 2B). In 2018, this percentage reached 1% for the EU-28 and varied from above 5% in Austria to 4% in France and Luxembourg, and to less than 1% in most Member States. Note: CMEF Pillar II result indicator R.03, calculated using the number of holdings in 2016. Cumulative indicator, covering 2014-2018. Source: DG Agriculture and Rural Development, CAP indicators data explorer.

The maximum amount paid for the young-farmers’ installation grant varies between countries. For example, it is EUR 17 000 in Greece but reaches the maximum of EUR 70 000 in Malta, Finland, most regions in Spain and five regions in Italy. Within Member States, the level of support can also vary according to the geographical location of farms (such as in Italy, where mountain areas receive more support), the type of farm (in Greece), the type of beneficiaries, and the value of the farm’s output (in Romania). More than 900 000 farmers benefited from early retirement in the EU in the 2007-2013 programming period. This early retirement cost EUR 2.6 billion . More than 60% of the beneficiaries of the early-retirement scheme were located in Poland, followed by Lithuania (14%), Spain and Greece (8% each). The measure was discontinued in the current programming period. However, early retirement was included as a transitional measure, with a small budget (EUR 504 million for the period 2014-2020). This transitional measure was implemented in twelve Member States in the programming period 2014-2020 . Between 2015 and 2019, EUR 0.41 billion was granted to almost 280 000 beneficiaries. 4.METHOD 4.1.Short description of methodology The methodology developed by the external contractor for the evaluation support study builds on five main parts, as set out below. EU-level informed opinion - literature review, EU-level interviews, key stakeholder interviews, and an online survey of Member-State administrations via European Network for Rural Development (ENRD) contact points. EU-level data analysis - exploring relations between context, inputs and impacts. This analysis covered planned expenditure for 2014-2020, and completed expenditure for 2015-2016. It also covered completed expenditure for 2017 provided these data were available. The analysis included: (i) maps of key variables; (ii) correlation analyses; (iii) econometric multi-criteria analysis (MCA). The latter included the generation of two rural typologies at Nomenclature of Territorial Units for Statistics (NUTS) 3 level (these typologies had an impact on case-study selection, and on the identification and estimation of certain impacts) and the classification of regions by clusters. Case studies - case-based detailed analysis of: (i) causal effects; (ii) delivery approaches and their impacts; (iii) efficiency; and (iv) added value. The case studies covered seven contrasting Member States (France, Belgium-Flanders, Italy, Estonia, Hungary, Poland and Ireland). The case studies analysed material at national, regional and local levels. This included: (i) secondary sources (previous evaluations and research); (ii) interviews with policy officers, experts, stakeholders and beneficiaries; (iii) primary data on delivery and beneficiary impacts; and (iv) examples of good practice in policy design/delivery, innovation and coordination. Additional, focused quantitative analyses. This included: (i) a counterfactual analysis of data from the Farm Accounting Data Network to assess the impact of aid to young farmers on farm performance (focusing on France and Italy and covering 2013-2015); and (ii) computable general equilibrium (CGE) modelling to examine the impact of generational-renewal expenditure on rural employment in Poland. Triangulation via: (i) comparative analysis of case-study findings; (ii) EU-level evidence and modelling results; and (iii) validation in seven workshops at national level, and three workshops at EU level (these workshops involved stakeholders and policy officials – two of the workshops were hosted by the ENRD). Further description of the methodology is provided in Annex 3. To clarify the wide range of evidence sources used in this process, and to demonstrate the principle of triangulation (using multiple sources to avoid bias), the table at the end of Annex 3 summarises how sources contributed to evaluation questions. No specific public consultation was carried out. The public consultation of reference for this evaluation is the public consultation on the future of the CAP. 4.2.Limitations and robustness of findings On the robustness of analysis and solidity of findings, the underlying analysis had some limitations, such as the uneven level of detail of the different instruments in the various questions. In the modelling exercise, the effects of Pillar I and Pillar II on support to young farmers could not be well separated. This was because the sample of young farmers granted the relevant support in the FADN was too small to create two separate groups. Moreover, the recording of support to young farmers was sometimes grouped with other support. In addition, interviewees had difficulties distinguishing between the effects of the young-farmer support and of the overall CAP direct payments. The analysis of generational renewal in rural areas (outside farming) is mainly qualitative, given the complexity of the question and the smaller role of the CAP outside farming. The difficulty in identifying a clear causal link between the application of the relevant measures and the impacts concerned is a further issue. In particular, this difficulty is due to the significant influence of non-CAP factors on generational renewal. With such a broad scope and such a wide range of measures to be evaluated within the timeframe of the evaluation, the analysis needed to focus on a limited number of Member States and regions. Moreover, the answers of stakeholders interviewed at EU level were sometimes coloured heavily by the situation in their home countries. This makes it more difficult to extrapolate the results and the drafting of conclusions for the whole EU. There were also data limitations for the analytical work carried out by the contractor in 2018-2019. Although data were generally available, both at EU level and at national level, sometimes they were not sufficiently precise or timely. For example, financial data for the programming period 2014-2020 mainly refer to planning and not to implementation (due to the time lag between planning and implementation). In addition, in the analysis of EU-level data, some difficulties and challenges arose largely because the data were either: (i) less comprehensive than originally thought; or (ii) less precisely specified or geographically differentiated than necessary to carry out the comparative and correlation analyses. Moreover, some of the quantitative analysis focused on a very small number of Member States (France and Italy for the FADN analysis and Poland for the CGE modelling). This needs to be considered when extrapolating the results to the EU as a whole. To address some of these shortcomings, additional analysis and data were used to prepare this report, such as the latest information on the implementation of the policy and a recent brief on generational renewal. In addition, this report refers to the reports of the European Economic and Social Committee (EESC) and of the European Parliament on generational renewal. Finally, the World Bank study on the CAP was also used to complement the analysis.



5.ANALYSIS AND ANSWERS TO THE EVALUATION QUESTIONS The evaluation questions are structured following the five evaluation criteria: effectiveness, efficiency, relevance, coherence and EU added value. Chapters 5.1 to 5.5 focus on the impact of the CAP on generational renewal in the farming sector by looking at each of these criteria in turn. The effect of the CAP outside farming is presented in Chapter 5.6. 5.1.Effectiveness The evaluation criterion on effectiveness shows to what extent the set objectives were achieved, how they were linked to the specific intervention, and whether there were any unexpected or unintended effects. The effectiveness analysis therefore considered how successful the CAP interventions have been in achieving or advancing generational renewal. Effectiveness questions 3, 2 and 1 (see Figure 23 ) are presented in this order to present firstly the effectiveness of young-farmer measures, secondly the effect of innovation measures on generational renewal, and thirdly the effectiveness of the CAP as a whole on the number of new farmers. The last two questions (4 and 5) address the environment in which young farmers operate, i.e. local development and the attractiveness of rural areas. 5.1.1.Impact of CAP measures on increasing the number of young farmers employed in agriculture Question 3. To what extent have the CAP measures/instruments related to young farmers been effective in promoting generational renewal? This evaluation question sought to investigate whether the young-farmers’ measures of Pillars I and II resulted in more young farmers and their greater economic performance. Two correlation analyses were performed to evaluate the effectiveness of: (i) the Pillar I young-farmers’ supplement (2015-2016 data); and (ii) the Pillar II expenditure planned under Focus area 2B (entry of skilled farmers into the agricultural sector) for 2014-2020 on changes in the number of young farm managers (2013-2016 data). These analyses demonstrate a very weak, negative correlation between this aid and the change in the number of young farm managers. Finally, a third analysis focusing on early-retirement aid for 2007-2013 shows no significant correlations between this aid and the number of young farm managers. The conclusion is that these relationships, if they exist, are dependent on context and should be explored with other methods. Thus, another exploratory method was applied, a multi-criteria analysis, which took into account the significant inter-regional differences at NUTS 3 level. In this analysis, five different types of regions were identified according to: (i) the level of CAP expenditure (payment indicator); (ii) the level of infrastructure; and (iii) the level of employment. The effects of the CAP vary significantly in these clusters. The young-farmers’ payments taken together imply the highest potential increase in the number of young farmers in less developed areas with many small farmers as set out in the five points below. 1.In sparsely populated, less developed areas with many small farms, an increase of 1% in the payments indicator would cause a potential increase of 2.2% in the number of young farmers. 2.In non-agricultural, developed regions with a small number of large farms and low CAP expenditure, an increase of 1% in the payments indicator would cause a potential increase of 1.2% in the number of young farmers. 3.In developed rural areas where other sectors dwarf the impact of agriculture, with few and large farms an increase of 1% in the payments indicator would cause a potential increase of 1% in the number of young farmers. 4.In developing regions with rapid agricultural restructuring/abandonment, an increase of 1% in the payments indicator would cause a potential increase of 0.5% in the number of young farmers. 5.In agricultural regions with large farms, high CAP expenditure, and an ageing farm population, the result was not statistically significant. Taking all regions together, the multi-criteria analysis suggests that the CAP young-farmers’ measures have a mostly positive impact on the number of young farmers. However, the magnitude of the impact reflects significant regional differences that depend on the different structural characteristics of farming in various regions. On the (weak) effect of generational-renewal measures on rural employment as a whole, see Chapters 5.1.3 and 5.6. Aid to young farmers and the value of this aid should not be assessed in isolation from wider socioeconomic conditions in rural areas. Even the best young farmer packages will be ineffective, if farming cannot offer a sufficient standard of living and quality of life to attract younger people. In more prosperous agricultural areas, aid to young farmers enables generational renewal. This occurs when the amount of aid offered and the conditions of the offer are significant in relation to: (i) the size of the farm business; (ii) land values; and (iii) knowledge provision. However, there are also examples where the aid is either too small or too costly to access. In addition, rural areas that lack basic infrastructure and services will struggle to keep young people even if the returns to farming are broadly comparable to those of other sectors. If national economies are buoyant and unemployment low, then rural exodus will be favoured wherever city living offers young people a better quality of life. Conversely, when economies are in recession and unemployment is high, returning to the family farm can appear an attractive alternative to subsisting on welfare benefits or short-term and low-paid employment in a city. This conclusion was supported by analysis of the case studies, which could also identify some differences between the impacts of Pillar I support and Pillar II support.

Among the interviewed stakeholders in case studies, opinions differed about the extent of the impact of the Pillar I young-farmers’ supplement. There were also considerable differences in the support level (in the case studies, the highest was in Flanders with on average EUR 3 700 per beneficiary and the lowest was in Poland with around EUR 600 per beneficiary). The young-farmers’ supplement helped to increase the income of these beneficiaries by EUR 540 million in 2018, a 73% increase in the total young-farmers’ top-up compared to 2015. Stakeholders in the farming sector said that direct payments should be used to stabilise income, and in some Member States (Poland) to buy land. In Italy, the perceived effectiveness of direct payments was linked to farm size. Young farmers with small farms and diversification strategies and/or high-quality food-production strategies do not perceive direct payments as necessary for their survival or for the success of their strategy. Conversely, young farmers with medium-to-large farms and specialisation strategies see direct payments and other forms of area payment as a sort of safety net in an environment of unstable prices and risks associated with climate change. Most farmers are aware of the other impacts of direct payments. For example, direct payments might contribute to increase land prices and therefore make it harder for new entrants to access land or for those who would like to buy land to enlarge a farm. Pillar II measures targeted at young farmers were perceived by case-study interviewees from the farming sector to be effective in supporting generational renewal in Belgium (Flanders), Poland, Italy and to a certain degree in Ireland and Hungary. In addition, many stakeholders from the public and private sectors have a broadly positive opinion of the CAP young-farmers’ support from both Pillars. These stakeholders feel that the support makes a difference and helps to ensure viable succession or start-ups of farms. Moreover, in Ireland, Estonia, Belgium (Flanders) and Poland, farmers reported that the young-farmers’ support had only a small influence on the decision to take over a family farm. However, they reported that this support acts as an impetus to make the change because it offers the possibility to improve farm performance. An analysis of farm-level data for 2013-2016 from the Farm Accounting Data Network was conducted to assess the impact of the installation grant on farm performance. This analysis suggests that, in comparison to farms that do not receive this aid, farms with the installation grant in Italy and France showed stronger economic performance (as seen in improvements to the scale of operations, better survival, and more resilient business strategies). For example, in France, young farmers who received installation grants increased their economic size and farm capital faster after the generational change. This in itself does not guarantee generational renewal, but it can be seen as a potentially influential factor. Figure 6 – Changes in farm performance pre- and post-generational change -French FADN sample. With young-farmers’ support Without young-farmers’ support Increase of economic size by 9% 3% Increase of total output by 5% 4% Increase of farm capital by 8% 2% Decrease of rented land by 10% 7% Source: Evaluation support study. The Pillar II young-farmer aid mostly supports farm succession within families. This poses the challenge of assessing the additionality of the funding, because children may be motivated to inherit from their parents with or without additional support, implying a degree of deadweight. Interviewees in the case-study analysis also concluded that implementing packages of integrated measures was an effective tool to promote generational renewal in a coordinated way. This coordination involves linking advice, training and financial support with national and regional policies, such as tax policy or institutional policy. Where measures are offered in a coordinated package with supporting advice to prepare business plans for the investment start-up aid, they lead to an increase in knowledge and confidence (see examples in Question 2). Conversely, there are examples where low additionality was identified in delivery systems that lacked sufficient advisory and technical-assessment support (Poland, Estonia). The characteristics of young farmers and their business aspirations play a strong role in some mountain regions (e.g. in two Italian case studies), where innovative strategies for diversification or high-quality products are creating sustainable and viable farms. Many of these supplements to start-up aid could be CAP-funded. In the case studies, it was also possible to identify a mixture of CAP and non-CAP factors working together to make measures more effective (notably in France, Italy, Hungary, Ireland and, to a lesser extent, in Poland). It is indeed possible to design young-farmer packages that ensure appropriate and significant additionality. This can be achieved by: (i) tailoring aid rates and delivery processes to local conditions; (ii) using a range of measures in a coordinated way; and (iii) coordinating measures closely with non-CAP policies and institutional arrangements. Support for young farmers in the case studies was most effective, when the CAP measures were designed to work alongside other legislative and fiscal arrangements, with support from specific institutions and processes at the local level. Question 2. To what extent have the relevant CAP measures/instruments focusing on generational renewal contributed to fostering innovation and inter-generational knowledge transfer? This evaluation question seeks to investigate the extent to which the CAP funding and measures focusing on generational renewal assist in knowledge transfer and innovation. Actions relevant to this question can include: (i) encouraging farmers to develop technical and business knowledge and skills; (ii) improving the level of knowledge and skills among farmers; (iii) promoting farmer-to-farmer innovation by sharing and exchanging information; (iv) assisting business coordination; and (v) networking between farmers or along supply chains. Keeping up-to-date with the level of knowledge necessary to run a modern farm business is essential for all farmers. It is even more important for younger farmers, who are best positioned to foster the innovation and resource efficiency needed to achieve EU objectives for environmental sustainability and climate action. In addition, the loss of valuable skills and knowledge as older and more experienced farmers leave the sector is a cause for concern. Although the qualifications of young farm managers (under 35) have increased over time, in 2016, only 43% of them had more than practical experience, out of which only 22% had received full agricultural training. Nevertheless, this is significantly above the average for all EU farmers, of whom only 32% have more than practical experience, out of which 9% had received full agricultural training. Across the EU, there are many differences in the level of training attained by farm managers. For example, there are very few young farm managers with more than practical experience in Romania. By contrast, more than 90% of young farmers have at least a basic formal qualification in Italy and France. Figure 7 – Agricultural training of farm managers, 2016

Source: DG Agriculture and Rural Development, based on Eurostat. Figure 8 – Agricultural training of young farm managers (under 35), 2016 Source: DG Agriculture and Rural Development, based on Eurostat. Of the total planned resources allocated to agricultural generational renewal in Pillar II, only a small proportion was targeted directly at knowledge transfer and information actions (1% of the total EAFRD amount in the financing plan for 2014-2020). It is therefore likely that the impact of this spending on knowledge exchange will be very small, especially compared to other EU and national funding for these services. A literature review on training, mentoring, and innovation reveals that finance, information technologies and business skills are key areas where more support for knowledge exchange is needed. Innovation and entrepreneurship are already supported by rural development measures. However, networking and informal peer support can be as important as formal training. In the public consultation, respondents said that the best way for the CAP to encourage innovation (Question 30) would be first to ‘support the engagement of farmers in innovative projects’ (28% of farmers, 25% of other citizens and 28% of organisations selected this option). Respondents said that the second-best option was to ‘support knowledge exchange through better access to advisory services, networking among farmers and demonstration farms (20% of farmers, 21% of other citizens and 20% of organisations selected this). The third-best option according to respondents was to ‘provide better access to finance/investment’. In addition, the EU-level interviews suggest that training programmes that promote new skills by supporting business planning and investment are key. Moreover, interviewees also said that they had a positive perception of LEADER’s role in supporting innovation. The analysis shows a clear and positive link between generational-renewal measures and increased inter-generational knowledge exchange in specific circumstances. Those circumstances are when training and advice are provided to young farmers and new rural entrepreneurs because it is a condition of accessing capital grants, start-up aid, and/or the Pillar I young-farmers’ supplement. For example, in Ireland a ‘green certificate’ is necessary to access Pillar I and II support schemes; in France, a minimum qualification is required to access the start-up aid; and young farmers in Poland need to learn management in their business planning. Secondary sources and interviewed farmers also emphasise the added value of delivering advice and business planning in a coherent process throughout the installation period. This was identified as important in 4 of the 7 case-study countries (Ireland, Italy, France and Hungary), and it was recommended for the future period by stakeholders in 2 more (Estonia and Poland). In the EU online survey of Member-State administrations, an integrated approach was also mentioned as relevant in 2 other Member States (UK and Croatia). 5.1.2.Impact of all the CAP measures on generational renewal in agriculture Question 1. To what extent have all CAP measures/instruments had an effect on fostering generational renewal in rural areas? This question seeks to investigate whether all CAP measures provide additionality in generational renewal. This was assessed in comparison with the achievements of Member-State policies. It is necessary to see whether there is cumulative evidence to support the claims that: (i) generational renewal is a key focus of the CAP; and (ii) generational renewal is indirectly promoted by the support for local development and quality of life in rural areas. Overall labour input in EU agriculture (a rough measure of the number of people working in agriculture) was 9.1 million full-time equivalents in 2019. This number has been falling in recent years, although the decline now seems to be levelling off (the decline was 3.8% per year in 2005-2011 but reduced to a decline of only 1.4% per year in 2011-2019). However, this decline is overestimated, because of changes in survey thresholds (mostly between 2007 and 2010) that excluded some farms (e.g. those below 1 ha in Poland) from the statistics. The decrease in farm labour was greater in those Member States that joined the EU in or after 2004 (EU-N13) than in the older Member States (EU-15), especially over the period 2005-2011. This reflects structural changes after accession to the EU. The greatest reductions in the number of farm workers took place in Bulgaria (throughout the period), and in Slovakia, Romania, Estonia and Latvia (in particular between 2005-2011). By contrast, in the Member States that joined the EU before 2004, farm labour increased between 2013 and 2016 and then stagnated, although the number of holdings continues to fall. From 2007 to 2016, the total number of farms in the EU decreased significantly, from close to 14 million in 2007 to almost 10.5 million in 2016. Figure 9 – Number of persons employed in agriculture (million) Note: in full-time equivalents, break in time series in 2010. Figure 10 – Number of farms in the EU (million) EU-15: EU Member States before the accession of 10 candidate countries on 1 May 2004, EU-N13: Member States which joined the EU after 1 May 2004. Source: DG Agriculture and Rural Development, based on Eurostat data. In the light of the combination of evidence from the MCA and the case studies, it appears that the CAP is not the most significant factor influencing the number of young farmers across the EU as a whole. Nevertheless, there are specific regions or countries where the CAP’s influence is felt more strongly than elsewhere. In policy terms, changes in the number of young farmers over time within a territory can be considered as a proxy indicator for generational renewal in agriculture in that territory. The contractor, who carried-out the study supporting this evaluation, analysed the pattern of change in the share of young farmers within the total population of farmers in 2003-2016. This analysis highlighted the significant impact of wider economic conditions on the relative attractiveness of farming for young people in many Member States. The share of young farmers increased during the global recession (2007-2010). In the Member States and regions with relatively low levels of economic development and relatively uncompetitive secondary and tertiary sectors, young people were more likely to return to their parents’ farms to try to make a living from the land, at least until the economy recovered and job prospects elsewhere improved again. There are also some areas where restructuring in agriculture resulted in a decline in agricultural-sector jobs regardless of wider economic conditions. These areas experienced a declining share of young farmers as young people chose alternative careers. However, within this group there were also some places that saw a resurgence of popularity in farming among young people in very recent years (e.g. Germany). More precisely, the cluster-specific regressions conducted by the contractor identified five clusters according to economic development and policy expenditure with a differentiated impact of generational-renewal measures. These five clusters are set out in the bullet points below. In this analysis, the payment indicator included all direct payments and not only the direct-payment support to young farmers, as well as the programmed spending under Pillar II measures falling under Focus area 2B, designed to facilitate generational renewal.

·Non-agricultural developed regions with low CAP expenditure: In these regions, the number of young farmers increased with higher infrastructure development, greater direct-payment and support under Focus area 2B expenditure, and the number of large farms. The employment rate in rural areas did not play a role. Without change (higher CAP payments, more infrastructure or employment), the number of young farmers would have decreased. ·Agricultural developing regions with rapid agricultural abandonment: In these regions, the analysis shows lower correlations between generational renewal and the factors studied (infrastructure, employment, CAP support, number of large farms). The number of young farmers increased slightly in these regions with greater expenditure on basic services and direct payments. The level of infrastructure or employment rate had no impact on the number of young farmers. ·Sparsely populated developing areas with many small farms: In these areas, the number of young farmers increased with the level of direct payments and support under Focus area 2B, as well as with expenditure on knowledge transfer. The level of infrastructure or employment rate had no impact on the number of young farmers. ·Agricultural regions with large farms, high CAP expenditure and an ageing farm population: In these regions, the number of young farmers decreased significantly with infrastructure level and the employment rate. However, the number of young farmers increased if expenditure on knowledge and basic services went up. In addition, the level of direct payments and support under Focus area 2B had no impact on the number of young farmers. ·Developed rural areas where other sectors hinder the impact of agriculture: In these areas, the number of young farmers increased when direct payments and expenditure under Focus area 2B increased. However, the number of young farmers decreased if employment figures in all sectors together went up. Infrastructure had no impact on the number of young farmers. Without support, the number of young farmers will decrease. This analysis shows that direct payments have a stronger positive role on the number of young farmers than the support given to basic services, infrastructure development, and knowledge transfer. Direct payments play the most significant positive role in sparsely populated developing areas with many small farms (cluster 3). It is also in these areas that the effect of knowledge support is significantly positive. The specific modelling exercise on Poland confirmed the positive impact of Pillar I CAP support on job creation in the agricultural sector. It indicates that without complementary young-farmer support (Pillar I), the number of jobs in agriculture would be 0.62% lower. The effect of Pillar II measures under Focus area 2B is less significant, adding only 0.17% more jobs in agriculture than would otherwise be the case. Figure 11 – Impact of CAP measures on the number of young farmers – correlation analysis by cluster Cluster 1 Cluster 2 Cluster 3 Cluster 4 Cluster 5 Infrastructure 0.81*** -0.44 0.23 -4.96*** 0.18 Payment indicator 1.07*** 0.41*** 1.91*** 0.63 0.74*** Employment 0.10 -0.34 0.24 -1.86*** -0.66*** Support to basic services and village renewal in rural areas (Measure 7) 2.43 0.70*** 0.72 0.61*** 0.009 Support to knowledge transfer and information actions (Measure 1) -0.08 0.09 1.32** 0.70*** 0.16*** Number of farms over 50 hectares 2.56** 0.01 1.99* -0.55 0.79*** Constant -2.98** -0.53 -0.37 0.90 -0.29*** Note: Indicates statistical significance at *** 1%, ** 5%, *10% level. A positive figure means positive correlation; a negative figure means negative correlation. Source: Evaluation support study. Case studies showed that decoupled payments in Pillar I have a positive impact on the overall development of the agricultural sector. However, these case studies also showed that, at a regional or sub-regional level, decoupled payments provide some disincentives to generational renewal, slowing inter-generational farm transfer. This slowing effect was also suggested in the World Bank report. This is because some older farmers use the payments as income support beyond what would be a usual retirement age to compensate for low pensions. Older farmers may be disincentivised to transfer their farms to younger people if their access to income and a reasonable quality of life depends on continuing to receive CAP support under Pillar I. However, case studies showed the effectiveness of initiatives using ‘soft’ approaches, including awareness-raising, advice, and planning for successful handover. Moreover, some Member States used institutional mechanisms and fiscal incentives to: (i) encourage changes in land ownership; and (ii) ease the process of inter-generational transfer for older, as well as younger, generations. Examples of these mechanisms and incentives include: (i) creating farm partnerships; (ii) incentivising share-farming and other collective business models; (iii) providing help with retirement income planning and tax breaks for the gradual transfer of assets; and (iv) using land banks or creating new non-profit organisations to consolidate and re-let landholdings to new entrants. Nevertheless, Pillar I support is only one of many factors explaining the inactive land market. The share of land for sale every year is low, and national legislation plays a key role in this. This is because Member States have control over inheritance laws; restrictions on access to land; transaction costs (which are often very high); and taxes. The conclusions of the effectiveness questions on the impact of the CAP measures targeting young farmers and in general are as follows. 1.Funding for generational renewal from the CAP makes a difference to the performance of farm businesses, their resilience, and the secure transfer of farms from the older to the younger generation. 2.By contrast, the positive effect of the CAP in fostering the number of young farmers varies from effective to only weakly effective between different Member States and territories. 3.The measures most relevant for generational renewal vary between countries and territories within countries, reflecting the different barriers and opportunities for generational renewal in each situation. 4.Differences in the magnitude of impact are determined by a combination of: (i) the underlying socioeconomic and cultural context; (ii) the selection of CAP instruments; (iii) the design of CAP measures; and (iv) the manner of implementation. 5.The best evidence of a sustained and positive impact between the CAP and generational renewal is in Member States in which a variety of measures and instruments is used in a complementary way. This means combining: (i) funding and investment aid for business start-ups; (ii) advice and training; and (iii) incentives for collaborative institutional and/or fiscal arrangements easing inter-generational transfer.

6.CAP generational measures have some ability to promote rural vitality in marginal territories suffering from: (i) economic and demographic decline; (ii) poor rural infrastructure and services; (iii) low levels of rural economic diversification; and (iv) little value added in agriculture and forestry. In these circumstances, CAP measures are particularly effective when delivered with supporting advice, mentoring and reviews. 5.1.3.Impact of the CAP measures relevant for generational renewal on: (i) the attractiveness of rural areas; and (ii) jobs in rural areas Question 4. To what extent have the CAP measures/instruments relevant for generational renewal contributed (directly and indirectly) to improving the development of rural areas in: (i) infrastructure and services; (ii) local governance/capacities; and (iii) social capital? To enable local development and agricultural jobs in rural areas, it is particularly important to close the gap between rural and urban areas in infrastructure, services, local governance and social capital. Access to broadband internet is an example of the continuing inequality between some rural and urban areas in Europe. This inequality limits the possibilities for young farmers to settle in rural areas, make a living, and improve social capital in the EU. Interviewees from the farming sector suggested that CAP incentives can act as a driver for young people to become farmers. However, they note that this decision is much more complex than a simple economic calculation: even if farming opportunities exist, decisions to live in rural areas are influenced by considerations of the future welfare of the farmer’s household. Some experts and stakeholder representatives said that the most significant factors influencing this decision are labour opportunities for other household members (spouses) and the presence of schools for children. In addition, particularly in remote areas, social services (such as medical care) were judged expensive and occasionally non-existent, because there is a limited and excessively dispersed market for them. Interviewees also mentioned that poor infrastructure was a negative driver. However, they said that infrastructure development may be supported by a wide range of policies, including some CAP measures. Interviewees said that municipalities in remote areas have benefited from investment initiatives under LEADER. Case-study evidence showed the multiplier impacts of CAP generational-renewal spending on the development of rural areas. The level of support going into rural areas from CAP generational-renewal measures seems particularly important in rural areas in need of local development (Ireland, France, Italy). In these areas, the multiplier effect of this funding could be essential for: (i) sustaining (in the case of Ireland) or developing local services; and (ii) economic diversification (in the case of Italy and France). However, in these situations, other funding (CAP Pillar I aid, aid for areas facing natural constraints, and other EU funding from regional and social policy) could also be equally or more important. The case studies revealed that LEADER is seen as having a dual role in generational renewal and wider rural development. In all case studies, LEADER was identified as a measure that helps to improve quality of life in rural areas. However, LEADER’s primary focus is on developing entire rural communities/areas and not on fostering generational renewal itself. Based on the case studies, LEADER-type development based on local planning, supplementary earning opportunities, diversification, and support for cooperation was seen as effective in a number of countries (Hungary, Estonia, Ireland, Belgium, Italy and France). Local government has directly benefited from LEADER assistance to improve infrastructure in some cases, and LEADER is known to help build social capital. Where LEADER projects and initiatives explicitly target young people and are therefore directly relevant to generational renewal, there is evidence from the case studies that these measures promote social capital, infrastructure, and local governance (in Hungary, Estonia, France and Ireland). Slightly more than one quarter of the EU population living in rural areas was exposed to the risk of poverty or social exclusion in 2016. The risk was highest in rural Bulgaria and Romania (at 54% and 52% of the rural populations, respectively). Also, more than one third of the rural populations of Greece, Lithuania, Latvia, Spain and Croatia faced the risk of poverty or social exclusion in 2016. A 2017 World Bank study argues that agriculture and the CAP contribute significantly to the eradication of poverty in rural areas, ‘but that role differs depending on where the country finds itself along the process of structural transformation’. Pillar I decoupled payments and Pillar II payments show a different link to poverty reduction over time, as set out below. 1.For regions with high levels of economic development, Pillar II is the only payment associated with regions in which poverty declined. 2.For regions with low levels of economic development, both Pillar I decoupled payments and Pillar II payments are associated with regions that achieve greater reductions in poverty. However, in regions with low levels of economic development, the magnitude of the correlation for Pillar II is considerably lower than in the regions with high levels of economic development. This suggests a need to improve the basic conditions of quality of life in rural areas, which would improve the returns on the investments made. The possibility of implementing the European innovation partnership (EIP) for agricultural productivity and sustainability (EIP-AGRI) was a novelty in the 2014-2020 rural development programmes, and was taken up by 26 Member States. The main objective of EIP-AGRI is to promote agricultural innovation that is more resource efficient, productive, climate friendly, and in harmony with the essential natural resources on which farming depends. This objective is partly achieved by bottom-up ‘operational group’ projects. Depending on their theme, these group projects can also contribute indirectly to boosting generational renewal, especially when they involve young farmers. In general, all operational groups help to build social capital as they contribute to creating networks of people around different topics to improve and disseminate knowledge. On the strengthening of social capital in rural areas, it is also worth mentioning the most relevant EIP networking activities. These include: (i) the focus group on new entrants into farming; (ii) the seminar on new skills for digital farming; and (iii) the workshop on innovative solutions for small agricultural and forestry holdings. The focus group dealt with existing or potential solutions to address the challenges faced by newcomers. The seminar helped farmers and farm advisers to develop the skills they need to face the digital transition in agriculture. And the workshop promoted networking among people and projects dealing with innovation and the adoption of new technologies in small farms. Case studies showed that generational-renewal measures can also promote social capital and governance benefits via collective actions and institutional change. This was the case in Poland, where generational-renewal measures fostered informal cooperation, and led to an increase in social capital. In particular, generational-renewal measures helped to encourage networking among farmers and between farmers and advisers. In Italy, France, Ireland and Hungary, support for young farmers was found to have stimulated cooperation, networking and partnerships among farmers. Other evidence from case studies and national workshops supports this view, and there is also some similar evidence from the literature. Question 5. To what extent have the CAP measures/instruments relevant for generational renewal impacted directly and indirectly on the maintenance/creation of jobs in rural areas? Agriculture represents less than 5% of employment in the EU. In Romania, it still employs more than 25% of the population, but in other Member States such as Luxembourg it employs less than 1%. It is a challenge nowadays to encourage young farmers to embrace agriculture as a future career to reverse the damaging demographic trends in agriculture. Encouraging young farmers to enter the agricultural sector, as either a manager or an ordinary employee, can contribute to job creation, greater sustainability and increased efficiency in the EU agricultural sector. This evaluation question assesses: (i) how many jobs are sustained or created directly by CAP generational-renewal funds; (ii) what the likely scale of multiplier effects is from CAP generational-renewal funding on employment in other sectors; and (iii) how the jobs created contribute to the development of rural areas more broadly. Figure 12 – Predicted employment impacts of CAP generational-renewal expenditure in Poland, 2014-2020 National employment Upstream or downstream Pillar I young farmers: % change from baseline Pillar II Focus area 2B: % change from baseline Primary sector NA 0.62 0.17 Food sector Downstream 0.13 0.19 Construction Upstream 0.01 0.02 Trade Downstream 0.01 0.02 Tourism (Hotel & Restaurants) Downstream 0.02 0.04 Education Upstream 0.05 0.08 Public administration Upstream 0.06 0.09 Other NA -0.07 -0.02 Note: The baseline depicts a situation without CAP support.

Source: Evaluation support study. The CGE modelling work on the Polish economy indicates that support for young farmers under both Pillar I and Pillar II of the CAP creates employment in the regional economy in Poland. While the overall number of jobs created by each pillar was similar over the programming period 2014-2020, the composition of the employment differed by CAP instrument. The Pillar I supplement for young farmers played a significant role in the primary sector mainly due to its much greater scale, creating 0.62% more jobs compared to the baseline situation without this supplement. The effect in the food sector is smaller but still significant (+0.13% compared to baseline). In the rest of the economy, the role of Pillar I support on jobs is very small, except for public administration (+0.06%). In Poland, the effect of the support under the Pillar II Focus area 2B is smaller than Pillar I in the primary sector (+0.17% jobs). However, the effect of this Pillar II support in the food sector is significant (+0.19% jobs compared to baseline). Pillar II support also has positive effects on education and public administration. However, these are rough estimates for Poland, indicating the general magnitude of impacts, and it cannot be assumed that all these new jobs would be in rural areas.

For rural employment overall, these impacts are small in comparison to wider economic drivers and trends. Polish interviewees from the farming sector also observed that the situation in the labour market in rural areas had reversed compared to 10 years earlier. The interviewees said that there used to be many young people unemployed in rural areas but that now there was almost no unemployment and that employment levels in rural areas were similar to those in urban areas. This creates an important ‘pull’ factor for young farmers. For Italy, case-study findings show some employment effects on beneficiaries of the young-farmers’ package in 2007-2013 (Pillar I and II), as set out in the bullet points below. In Sicily, farm employment increased by about 1.5 workers per year on average in each farm. This increase was mostly made up of permanent employees (73%), followed by seasonal workers (11%) and family labour (16%). In one third of new farms in Marche, young farmers started working full-time after the generational change. Before the generational change, they were under-employed. In the other two thirds of new farms, there was no relevant change in employment status (full-time or part-time) after the generational change. In France, the decline in agricultural employment expressed in annual working units between 2007 and 2016 was less marked than the EU average, or in most neighbouring countries. The ex-post evaluation of the French rural development programmes showed that the pattern of declining employment in agriculture slowed markedly after 2010. It is difficult to isolate the role of the rural development programmes in influencing this change (wider economic conditions had a significant influence). However, a dedicated study attempted to do this, and found a positive correlation between support for knowledge exchange/training, agri-environmental measures and diversification on the one hand and levels of employment in agriculture on the other. But this study did not examine support for young farmers specifically. The ex-post evaluation also made an interesting finding about mountain areas that were sustained through considerable CAP support via: (i) aid for areas facing natural constraints; (ii) aid and higher rates of support for investments and the setting up of new farms; and (iii) generational-renewal measures. In these mountain areas, the levels of farm employment were less likely to have fallen than in other regions of France. In Hungary, the most successful CAP measures for retaining the workforce and expanding employment in rural areas were those that supported greater labour intensity and that were implemented alongside greater capital investment. In Ireland, the case study reported that 7 000 new farmers had set up so far during the current programming period. However, the case study did not say what the figure would have been in the absence of CAP support, or how many older farmers retired as these new farms were set up. In Ireland, the impact of generational-renewal measures on employment is likely to be greater when they target labour-intensive forms of agriculture rather than farm succession in capital-intensive sectors where opportunities to expand labour use are limited. The MCA indicated that CAP spending has a positive impact on the number of young farmers in most rural areas across the EU. The greatest positive impacts are on farms in marginal areas with scope for economic development. By contrast, the aid might not generate much employment impact in farms located in: (i) areas where the wider economy is depressed or undeveloped; or (ii) completely different and economically buoyant regions where agriculture is capital-intensive. The case-study evidence shows that the impact of generational-renewal measures on employment is likely to be greater when these measures target labour-intensive forms of agriculture rather than farm succession in capital-intensive sectors where opportunities to expand labour use are limited. The case study also shows a link between diversified businesses and value-adding business development: generational-renewal aid that helps farmers to re-think their business strategies and have confidence to move into higher value markets are more likely to generate businesses that create new rural jobs. Encouraging farmers to re-think their business strategies in this way also depends on the quality of supporting advice and mentoring. This is because this advice and mentoring needs to give farmers the entrepreneurial confidence to move into new markets or develop supply chains. CAP measures mainly target the maintenance or protection of farming jobs rather than the creation of new farming jobs. The case-study evidence shows that generational-renewal measures help to maintain agricultural jobs, particularly in marginal areas. It is also important that support be delivered in a targeted way with advice and training to improve the quality of those jobs and the performance of supported businesses. In particular, the World Bank report Thinking CAP said that the CAP supported the creation of better (i.e. more remunerative) jobs for the workers who remained behind in agriculture, while it reduced poverty in agricultural areas. 5.2.Efficiency The evaluation criterion on efficiency aims to show whether the effects (benefits) were achieved at a reasonable cost. This criterion firstly assesses the measures that directly promote generational renewal (Question 6), and secondly assesses the measures that indirectly promote generational renewal (Question 7). It also looks at any possible reduction in administrative burden created by the measures. 5.2.1.Administrative efficiency of the measures to foster generational renewal and quality of life in rural areas Question 6. To what extent have the relevant CAP measures/instruments been efficient in directly fostering generational renewal? This evaluation question assesses the estimated administrative costs of delivering support for generational renewal. It also evaluates: (i) how implementation costs vary across Member States/regions: (ii) which measures are most expensive and why; and (iii) whether there are ways to reduce these costs without reducing outcomes. Interviews and online surveys showed that rural development programmes in some Member States changed significantly from one period to the next. This may cause uncertainty and give rise to additional costs. Another important issue raised by interviewees and respondents in the farming sector was that generational-renewal measures usually address young people that are already interested in these measures and informed about them. However, many young people could avail of funding opportunities but are not able to find out about them. Efficiency has been measured in costs and time to complete business start-ups and related investments linked to the business plan. Efficiency varies considerably between: (i) different countries; (ii) different measures that are delivered individually or in packages; and (iii) different delivery approaches and actors within these processes. Case studies have assessed the costs of delivering support for generational renewal. These costs have been calculated on the basis of: (i) the working time spent in preparing, approving and providing payments for an average application; and (ii) the average salaries of administrative-technical personnel involved in processing applications in some Member States. For example, the delivery cost of support to Italian young farmers is reasonably low (between EUR 5 000 and 5 500 per application in Marche and Sicily). It is especially low considering that the support package always includes at least two measures (sometimes three) and that these delivery costs represent about 2% of the total public expenditure activated by the package in the two regions considered. But there are other Member States where delivery costs are higher. In some regions, a higher cost (such as above EUR 7 000 per application in the French Loire region for Measure 6 on ‘Farm and business development’) is partly explained by the longer time devoted to advising young farmers on how to prepare the application. This increases the share of delivery costs in total expenditure, but this seems necessary to reach as many farmers as possible and to prepare viable projects. In Haute-Loire, the costs are lower (EUR 4 000 per application). In both French regions, the costs are also lower for investment support (sub-measure 4.1), at between EUR 1 000 and EUR 2 500 per application.

Delivery costs do not include private costs (costs borne exclusively by the applicant), which have been estimated separately in some countries. Private costs strongly depend on the complexity of the application and the size of the investment. In general, the cost of filling in applications has not been expensive in recent times, as it is fully digitalised in most case-study countries. For the installation grant (paid to young farmers setting up their farms for the first time), private costs were estimated at between EUR 375 and 500 per application in Poland, between EUR 400 and 1 000 in Estonia, and around EUR 2 000 in Hungary. In Ireland, the estimated private costs (including the private costs of investment support) vary between EUR 375 and 1 175 depending on the complexity of the application. Efficiency in combining different instruments to promote generational change is more evident in France and Italy. France combines rural-development instruments and national policies to support the preparation of installation-grant applications. Italy mixes different instruments and simplifies the application process for the potential beneficiary in a ‘one-stop-shop’ approach. Interviews and case studies show other examples of efficiency and inefficiency in the design and implementation of generational renewal measures under the CAP. In summary, Pillar I support for young farmers is comparatively cheap to deliver. Pillar II aid is perceived by some beneficiaries as relatively simple and easy to access, but it can also be associated with slow processes and relatively high implementation costs. The key factors for administrative efficiency in the delivery of aid include: othe ratio of applicants to available funds (a high ratio can easily swamp the delivery system and lead to long delays); othe quality of information (including transparent selection and eligibility processes), advice and support available to applicants to ensure that their plans and applications are of high quality (to reduce delays and repeat requests for more information); othe level of skills, resourcing and coordination of relevant personnel within the public administration to: (i) facilitate swift and robust appraisal of applications (to enable funding to be offered to the cases offering best additionality); and (ii) smooth the process of associated permissions or checks; othe ease of operation, continuity, and quality of communications between beneficiaries and administrative/advisory personnel (to encourage trust and efficiency in transactions). Targeting aid rates – or using selection criteria – appear to be efficient ways to direct policy instruments towards certain issues. There is evidence that adjusting rates of aid in different areas can focus public expenditure on the most fragile areas (mountainous and remote areas). Efficiency appears to be strongly conditioned by institutional organisation at Member State and regional level. Every delivery model must be analysed taking into account any external conditions that hamper the type of delivery undertaken. This is key to any evaluation: the different approaches cannot be assessed only in terms of costs and time; many more factors might play a role. Most of the policy instruments under examination are less efficient for young entrepreneurs coming from outside the traditional family-farm setting, and for those without experience in the agricultural sector. Preparing an application and securing aid takes longer and requires more effort for this group than it does for farm successors. This is because there is an important role played by knowledge transfer from older farmers to younger farmers within a family. In conclusion, no significant inefficiency problems were found. The administrative costs of applying for and processing applications can be considered to be reasonably in line with the size and complexity of the projects. This is especially the case if the projects are implemented under the form of a package of measures. Question 7. To what extent have all CAP measures/instruments been efficient in fostering generational renewal indirectly, by improving the quality of life in rural areas? The analysis of this evaluation question is based on the evidence gathered in other evaluation questions. This evidence suggests that generational-renewal measures have a positive, small, indirect impact on quality of life for farmers. A focus on generational renewal without a balancing investment in wider rural development is a restrictive and insufficient approach. It therefore seems clear that, to maximise the potential for generational-renewal measures to enhance quality of life, it is important to see them as only one component of a broader mixture of essential interventions. Rural-development aid, in complement to other EU policies such as the regional and cohesion funds, that promotes rural economic diversification, added-value, better services, and better infrastructure (including broadband) is potentially vital to improving the broader economic climate, particularly in remote areas. Within the rural development programmes, the share of funding devoted to economic diversification, job creation and rural services (including broadband, transport and social/community activities) is relatively small (around 15%). However, from the interviews and secondary evidence reviewed, this expenditure brings value at local level and indirectly promotes generational renewal. For example, in Member States that fund the development of broadband access with EAFRD, there is a direct link between the funded operations and the impact achieved: in Lithuania, next-generation-access (NGA) broadband in rural areas increased from 15.6% to 28.7% between 2015 and 2019, while in Sweden it went up from 13.9% to 40.9%. In addition, several case studies showed that the significant expenditure on agri-environment-climate measures and on support for areas facing natural constraints had an indirect but important effect on generational renewal. This aid does not have a direct impact on rural quality of life understood more broadly. However, it helps significantly to keep farmers in the business by meeting their income needs, particularly in economically marginal areas. This is seen as important by interviewees for maintaining communities and cultural value in these places. Without Pillar I support, modelling exercises showed that many farms would be unviable and that agricultural employment would decline. But studies reached different conclusions about the effects of this on rural quality of life. Some studies suggested that this could lead to a decline in the quality of rural life associated with further rural depopulation. Other studies suggested it could release resources from agriculture which could stimulate other kinds of rural added value or economic activity, adding to rural quality of life. To add to this complexity, the diversity of situations of rural change described in the case studies means that the balance of positive and negative impacts of direct payments on rural quality of life depends critically on wider socioeconomic conditions and on other economic and social policies. These conditions and policies vary considerably between countries and regions. The EAFRD accounted for only 23% of European Structural and Investment Funds (ESIF) spending in the 2014-2020 period. The execution rate of EAFRD (60%) is the highest, together with the Youth Employment Initiative. 5.2.2.Administrative burden Question 8. What is the administrative burden of the relevant CAP measures/instruments linked to generational renewal: (i) at the level of the beneficiaries; (ii) at the level of Member-State administrations; and (iii) at EU level? Efficiency is also affected by administrative burden. This question seeks to ascertain: (i) to what extent accessing and delivering generational-renewal measures is felt as a heavy administrative burden on applicants and delivery bodies; and (ii) whether there is scope to reduce this burden. It also asks at which policy level the burdens arise, so that remedial actions can be targeted appropriately.

Evidence from the case studies shows that time requirements differ across programmes and depend on three broad categories of factors: (i) the requirements of the rural development programme (designed by Member States); (ii) the role of institutions and the private sector; and (iii) general socioeconomic factors. Inefficiency arises due to inadequate support to farmers when they are preparing their applications. This is a specific problem in Poland and Belgium (Flanders), where case studies highlighted incomplete applications and the delays they cause in the approval process. More complex projects usually require more time, both in the assessment and implementing phases. This is because business plans often cover: (i) new buildings or the restructuring of already existing buildings (Poland, Hungary and, Ireland); (ii) more innovative investments (Sicily and Marche); or (iii) the diversification of farm activities (Hungary). According to interviewees from the farming sector, few people can apply to a rural-development scheme without help and this implies a cost. For example, the application processes for Measures 6 (farm and business development) and 4 (investment in physical assets) can be complicated for applicants. These processes may therefore require skills beyond applicants’ knowledge and expertise. Furthermore, advice is not always relevant or accessible. In countries where the government provides an advisory service, it is easier for interested young farmers to apply for funding. Provision of private advisory services may vary. For example, in remote areas, private advisory services may be non-existent because there is a limited market for them. Other issues arise from the perceived relationship of applicants to Member-State authorities. Interviewees from the farming sector reported that, in some Member States, young farmers wanting to access Pillar II measures have become frustrated with the amount of detail they must provide and the strict checks on applications. Some of the referred interviewees concluded that with less administrative burden – or more help from effective advisory services – farmers could better concentrate on effective and innovative entrepreneurship. Literature reviews show mixed findings on the impact of bureaucracy. Some found excessive administration and strict requirements to be a barrier to farmers accessing support. Other studies reported cases where the administrative requirements – specifically, the requirement to submit a business plan – were found to be positive. This is because these requirements discouraged less entrepreneurial farmers, and taught new skills to those who persevered. Some studies found that farmers were only able to complete the paperwork with mentoring support. This support could be costly if not provided by government schemes, but it had a positive outcome by teaching new skills. The evaluator in charge of the support study sent a questionnaire to public officials working in bodies managing rural development to evaluate data on the time it took to deliver development aid across the EU. The results of the questionnaire compared delivery times in Poland, France (Loire) and Italy (Marche and Sicily). These results show that the preparation of applications in the Loire took longer than in other countries. This was due to the specific accompanying programme of supporting advice/training and planning. Italian application packages also take longer than average to approve and complete (especially in Marche). In the specific case of Marche, these longer times are due to the increasing difficulties faced by farms in: (i) covering investment costs with their own money during the transition period before the new production is set up; and (ii) finding credit support from banks. The administrative capacity of regional/local offices plays a crucial role in delivery time in Hungary and Italy. This capacity depends on the number of people involved and the ratio between technical officials and applications submitted. Delays in getting funds from paying agencies were emphasised by case studies from Belgium, Hungary and Italy. In particular, delays are linked to the procedure set up by the paying agency to check payment claims. Changes in implementing rules (between calls, from one programming period to the next, or even within the same programming period) often affect the speed of preparation/submission of applications by potential beneficiaries. The application process for these measures may also be made more burdensome for applicants by poor policy design or inadequate resourcing at national or local levels. This can lead to a lack of administrative personnel to make appropriate checks and take decisions. Proper interpretation of legal and other requirements (such as planning permissions) can also delay the process and increase the perceived administrative burden by interviewees and applicants in the farming sector. In addition, the need to comply with the selection criteria of individual measures, and the practice of financial allocation by individual measures, unnecessarily increases the complexity of selecting packages of measures and managing financial resources within the package. The delivery costs (i.e. the costs of management and checks) for the whole CAP budget borne by Member States are estimated at 3.5% of CAP expenditure. This is significantly less for direct payments (2.1%) than for rural development (5.4%). This level is very reasonable and the CAP is cost-effective. For beneficiaries, delivery costs related to rural-development measures were estimated in 2011 at 4.7% of total public expenditure (including national co-financing). 5.3.Coherence The evaluation criterion on coherence aims at demonstrating: (i) whether the intervention contradicts other interventions with similar objectives; and (ii) whether the intervention works well together with other EU interventions. The coherence analysis assesses the ‘internal’ coherence (how the different components of the interventions interact with each other) and ‘external coherence’ (how the different components of the interventions interact with other interventions at EU, Member States or international level). This chapter also assesses the influence of external factors on CAP measures. 5.3.1.Coherence of relevant CAP measures linked to generational renewal with each other 9. To what extent are the relevant CAP measures/instruments linked to generational renewal in rural areas coherent with each other? This evaluation question evaluates: (i) to what extent the different measures work together to support generational renewal in rural areas; (ii) how effective integrated approaches/projects (combining different measures) are in supporting young farmers and/or entrepreneurs; and (iii) whether there is good local coordination at the point of delivery of the generational-renewal measures. The extent to which measures/instruments linked to generational renewal are coherent with each other varies across the case studies. The delivery models vary, but in general, measures are considered to be mutually supportive with a high degree of synergies. Delivery models range from single measures of support (Belgium (Flanders), Estonia, Poland and Ireland) to complex integrated packages (Italy, Hungary and France). In Belgium (Flanders), Poland, Estonia and Ireland, no coordinated packages of measures are offered, although the managing authorities and beneficiaries have identified synergies between the measures proposed. The main parts of the integrated packages analysed in the case studies are set out in the points below. 1.In Italy, the so-called young-farmers’ package builds on the integrated use of start-up aid with measures on business plans, farm diversification and other investments from the rural-development-programmes (RDP) menu. The direct-payment support to young farmers is not part of the package. 2.In Hungary, the young-farmer thematic sub-programme supports the start-up and development of farms by enhancing knowledge, developing practical skills, and offering consulting and mentoring. 3.In France, complementarity between measures is particularly strong for the livestock sectors and in areas facing natural constraints. This is because of: (i) the elimination of the age limit for support in areas facing natural constraints; (ii) the revaluation of income-support entitlements in disadvantaged areas; and (iii) the lowering of minimum density thresholds. There are also a few interesting examples of coherence in Member States that do not implement integrated packages. These examples are set out below. 1.In Ireland, young-farmer schemes under Pillars I and II of the CAP are mutually supportive. T