Table of contents 1.Introduction Purpose and scope 2.Background to the intervention Description of the intervention and its objectives Baseline and points of comparison 3.Implementation / state of Play 4.Method 4.1.Method for the evaluation support study 4.2.Internet based public consultation 4.3.European Economic and Social Committee Report 4.4.Limitations and robustness of findings 5.Analysis and answers to the evaluation questions 5.1.Effectiveness 5.1.1.Axis 1. Improving the competitiveness of the agricultural and forestry sector 5.1.2.Axis 2. Environment and the countryside 5.1.3.Axis 3. Improving the quality of life in rural areas and encouraging diversification of the rural economy 5.1.4.Axis 4. Building local capacity (LEADER)

5.2.Efficiency 5.2.1.Qualitative assessment 5.2.2.Quantitative assessment 5.3.Coherence 5.3.1. Coherence of rural development policy with other CAP funds and other EU interventions in the same programme area 5.3.2. Coherence with the overall rural development priorities 5.4.Relevance 5.5.EU Added Value 6.Conclusions Annex 1. Lead DG, Decide Planning/CWP references Annex 2. Stakeholder Consultation Annex 3. Data on implementation of rural development programmes by measure Annex 4. Intervention logic by axis Glossary Term or acronym Meaning or definition AWU Annual Work Unit CAP Common Agriculture Policy CMEF Common Monitoring and Evaluation Framework EAFRD European Agricultural Fund for Rural Development EESC European Economic and Social Committee ENRD European Network for Rural Development ESIF European Structural and Investment Funds EU European Union GDP Gross Domestic Product GVA Gross Value Added LAG(s) Local Action Groups LEADER Liaison Entre Actions de Développement de l’Économie Rurale RI Result Indicator SWOT Strengths, Weaknesses, Opportunities and Threats UAA Utilised Agricultural Area 1.Introduction Purpose and scope As part of the implementation of the 2007-2013 Rural Development policy, in 2015 Member States had to carry out the ex post evaluation of their rural development programmes. These evaluations had to examine the degree of utilisation of resources, the effectiveness and efficiency of the programming of the European Agricultural Fund for Rural Development (EAFRD), its socio-economic impact and its impact on the Community priorities. They also had to cover the goals of the programme and aimed to draw lessons concerning rural development policy. They were expected to identify the factors that contributed to the success or failure of the programmes’ implementation, including as regards sustainability, and identify best practice.

The current evaluation provides a summary of the findings of these ex post evaluations and analyses the effectiveness, efficiency, coherence, relevance and EU added value of the 2007-2013 Rural Development Policy based on a synthesis of the work of the Member States. It builds on the ex post evaluations of the rural development programmes in 26 Member States: Croatia did not have an EAFRD financed rural development programme in the 2007-2013 period. Bulgaria did not provide an ex post evaluation of its rural development programme for the period in question during the preparation of the evaluation support study. A number of the issues raised in this evaluation had already been identified during the implementation of the programmes and were addressed in the legal framework for the 2014-2020 programming period (for example, revising the Common Monitoring and Evaluation Framework to improve the intervention logic, reduce the number of indicators and simplify the evaluation questions, and streamline reporting). The lessons drawn from this synthesis have further served to inform the preparation of the post 2020 Commission proposals for the modernisation of the Common Agricultural Policy (CAP) and will be useful for the assessment of the Member States’ CAP Strategic Plans that are central in the Commission’s proposals . The conclusions of this evaluation is also very relevant for the long-term vision for the EU’s rural areas , which aims to enable rural areas to make the most of their potential and support them in facing their own unique set of issues, from demographic change to connectivity, the risk of poverty and limited access to services. 2.Background to the intervention Description of the intervention and its objectives The EU’s rural development policy aims at helping the rural areas of the EU to meet a wide range of economic, environmental and social challenges. Frequently called "the second pillar” of the Common Agricultural Policy (CAP), it complements the system of direct payments to farmers and the measures to manage agricultural markets (the so-called "first pillar"). EU rural development policy offers a flexible approach, based on the principles of subsidiarity and partnership. When designing rural development programmes, Member States have a significant degree of flexibility in finding a balance between the sectoral dimension (i.e. agricultural restructuring) and the territorial dimension (i.e. land management and the socio-economic development of rural areas). From a menu of approximately 40 support measures, Member States select those best suited to address the specific strengths and weaknesses of individual programming areas. In a first step, based on a thorough analysis of the economic, social and environmental situation of their rural areas and their potential for development, Member States submitted national strategy plans translating to the Member State situation the EU priorities agreed in the Community strategic guidelines for rural development. These priorities were: improving the competitiveness of the agricultural and forestry sector; improving the environment and the countryside; improving the quality of life in rural areas and encouraging diversification of the rural economy; building local capacity for employment and diversification; ensuring consistency in programming (maximise synergies between axes); and complementarity between Community instruments. In a second step, based on a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis, choosing from a set of measures for which they could receive Community financial support, Member States established, at national or regional level, integrated rural development programmes, specifying what funding was to be spent on which measures in the period 2007-2013. Member States and regions had to spread their rural development funding between three thematic axes: Axis 1 - economic concerns (competitiveness of agriculture and forestry), Axis 2 - the environment and the countryside (biodiversity, climate change, sustainable resource use in agriculture and forests) and Axis 3 - social aspects (quality of life). Moreover, a part of the funding had to support the implementation of local development strategies by the local action groups of LEADER (Liaison Entre Actions de Développement de l’Économie Rurale). This "LEADER approach" to rural development involves individual projects designed and executed by local partnerships to address specific local problems in line with a local development strategy (LDS). This horizontal approach was implemented through Axis 4 of the Rural Development. The whole process of preparing the rural development programmes was carried out in close cooperation between the Member States and the Commission services. Funding from the European Agricultural Fund for Rural Development (EAFRD) of each rural development programme had to be spread between the four axes, as a safeguard to ensure that the programme reflected the main policy objectives. The required minimum funding was 10% for Axis 1, 25% for Axis 2, 10% for Axis 3 and 5% for LEADER (2.5% for the new Member States). These minimum percentages were sufficiently low to leave Member States or regions a high margin of flexibility to emphasize the policy axis in function of their situation and needs. The EAFRD had a total endowment of EUR 96.2 billion for the 2007-2013 period. Axis 1 - competitiveness 111 - Vocational training and information actions 112 - Setting up of young farmers 113 - Early retirement 114 - Use of advisory services 115 - Setting up of management, relief and advisory services 121 - Modernisation of agricultural holdings 122 - Improvement of the economic value of forests 123 - Adding value to agricultural and forestry products 124 - Cooperation for development of new products, processes and technologies in the agriculture and food sector and in the forestry sector 125 - Infrastructure related to the development and adaptation of agriculture and forestry 126 - Restoring agricultural production potential 131 - Meeting standards based on EU legislation 132 - Participation of farmers in food quality schemes 133 - Information and promotion activities 141 - Semi-subsistence farming 142 - Producer groups 143 - Providing farm advisory and extension services 144 - Holdings undergoing restructuring due to a reform of a common market organization Axis 2 – Environment and countryside 211 - Natural handicap payments to farmers in mountain areas 212 - Payments to farmers in areas with handicaps other than mountain areas 213 - Natura 2000 payments and payments linked to Directive 2000/60/EC 214 - Agri-environment payments 215 - Animal welfare payments 216 - Non-productive investments 221 - First afforestation of agricultural land 222 - First establishment of agroforestry systems on agricultural land 223 - First afforestation of non-agricultural land 224 - Natura 2000 payments 225 - Forest-environment payments 226 - Restoring forestry potential and introducing prevention actions 227 - Non-productive investments Axis 3 – Diversification and quality of life 311 - Diversification into non-agricultural activities 312 - Support for business creation and development 313 - Encouragement of tourism activities 321 - Basic services for the economy and rural population 322 - Village renewal and development 323 - Conservation and upgrading of the rural heritage 331 - Training and information 341 - Skills-acquisition and animation measure with a view to preparing and implementing a local development strategy Axis 4 - LEADER 411 - Competitiveness 412 - Environment/land management 413 - Quality of life/diversification 421 - Implementing cooperation projects 431 - Running the LAG, skills acquisition, animation Source: DG Agriculture and Rural Development The figure below presents a high-level intervention logic for the 2007-2013 rural development programmes. A more detailed intervention logic per axis is presented in the Annex 3. Source: DG Agriculture and Rural Development In 2008, a CAP policy review process, known as the ‘health check’, included an increase in modulation, whereby direct payments to farmers were reduced and the funding transferred to rural development (Council Regulations (EC) No. 73/2009 and (EC) No. 74/2009). In addition, a further EUR 1.02 billion was made available to Member States and regions to reinforce their rural development programmes as part of the European Economic Recovery Plan agreed in December 2008. The additional funding was reserved for actions related to climate change, renewable energy, water management, biodiversity, innovation linked to these four areas, developing broadband internet in rural areas, or for accompanying measures in the dairy sector. An important element of the 2007-2013 rural development policy was the creation of a common monitoring and evaluation framework, including an indicator set (output, result, impact and context indicators) and periodic evaluations to be carried out by the Member States on the basis of predefined evaluation questions. The ex post evaluation of a rural development programme is the final part of ongoing evaluation of the programming period of 2007-2013, built upon its monitoring and evaluation activities conducted throughout the programme implementation period.

Baseline and points of comparison In 2006, which served as baseline for the ex post evaluations, the EU-27 rural areas (predominantly rural and intermediate regions) represented 91% of the territory and 56% of the population. The corresponding shares for predominantly rural areas were 54.4% of the territory and 19.2% of the population. Rural areas are therefore particularly important in terms of territory. Among the Member States, the importance of rural areas varied from the more "urban" ones (Belgium, Netherlands, Malta) to the more "rural" ones (Ireland, Finland, Slovenia) along a continuum where intermediate regions can play a major role. Even if economic activity tends to be concentrated in more densely populated areas, rural areas in 2006 generated 43% of the Gross Value Added (GVA) in the EU-27 and provided almost 55% of the employment. However, compared to urban areas, rural areas lagged behind as regards a number of socio-economic indicators: demographic situation in some areas, income per capita, lower employment rate and higher unemployment rate, human capital, activity of women and young people, development of the tertiary sector as well as other aspects linked to the quality of life. The impact assessment in view of the post 2006 rural development policy carried out in 2004 and the ex-ante evaluations pointed to the difficulties of many rural areas to adjust to changes brought about by a combination of factors, including continuing technological change, a decline in real food prices and in the proportion of income spent on food, and the difficulties of competing in increasingly global food markets. As a result, at the time, rural regions faced significant economic problems, including: ·high rates of unemployment, which stood at 11.1% in predominantly rural areas, compared to an average of 9.8% across the EU-25 as a whole (1999/2001 average); ·widespread problems of underemployment; ·low levels of Gross Domestic Product (GDP) per head, which in predominantly rural areas stood at 71% of the EU-25 average in 1999-2001; and · a relative shortage of new development opportunities in many rural areas. At the start of the programming period, Member States were at different levels of dependence on the primary sector. Within the EU-27, employment in the primary sector in 2006 was 6%, yet with wide variations, from 1.5% in the UK and 1.6% in Luxembourg to 20.5% in Bulgaria and 30% in Romania. The central and eastern European Member States were particularly heavily dependent on agriculture, however, also here significant variations are apparent, less than 4% of the workforce of Czechia and Slovakia were employed in agriculture in 2006. In terms of gross value added, there were also large variations: the primary sector accounted for 0.4% of total GVA in Luxembourg, but for 8.8% in Romania in 2006. At the social level, the more peripheral local areas were characterised by depopulation, caused by negative rates of change in natural population (where there are more deaths than births) and high rates of out-migration (especially among young people), leaving behind an ageing population. Rural population is usually older than average. At the same time, many less remote rural areas in Europe faced very different issues, as they often presented an attractive alternative to living in cities, and were experiencing population growth. In many Member States, in-migration to rural areas from urban areas was an increasing trend, often involving increased populations of commuters and retired people. This led to other problems such as increased development pressures in the countryside, a change in the balance of rural communities, and shortages of affordable housing as wealthier urban incomers out-bid local residents. The 2004 impact assessment also pointed out that Europe’s rural environment was subject to a variety of pressures, stemming from the intensification of land management in many areas, and its abandonment in others. The marginal viability of both agriculture and forestry has brought a widespread risk of land abandonment to many rural areas with consequences for the landscape and environment. Agriculture and forestry are the main land users and play a key role in the management of the natural resources in rural areas and in shaping rural landscapes and wildlife habitats. Managed farmland and forests make an important contribution to maintenance of high natural value areas in the EU. 3.Implementation / state of Play The 2007-2013 programming period was fully closed by 2020. The overall financial implementation rate for the 92 programmes for the 2007-2013 period reached 97.0%, where EUR 93.4 billion funds were consumed in comparison with the EUR 96.2 billion of initially available EU funds. Source: DG Agriculture and Rural Development Overall, the largest share of EAFRD spending went to Axis 2 (Environment), followed by Axis 1 (Competitiveness). These two account for above 80% of EAFRD spending. The differences in Member States choices are illustrated in Figure 4 .

Source: DG Agriculture and Rural Development Source: DG Agriculture and Rural Development Figure 5 (below) presents an overview of the most important measures in terms of share of the EAFRD contribution for the EU-27. Overall, the rural development programmes in the programming period contributed among other to: ·578 000 farm modernisation projects; ·start-up support for 192 000 young farmers; ·385 000 farmers' involvement in quality schemes; ·more than 6.8 million training days for farmers; ·More than 48 000 000 physical hectares supported under agri-environment. 4.Method The purpose of this evaluation is to provide a synthesis and an analysis of the ex post evaluations of the 2007-2013 rural development programmes submitted by the Managing Authorities, to identify common trends, highlight differences between the programmes and provide conclusions and lessons learned. This evaluation is based on three main sources of input: ·The evaluation support study of the external contractor. This is based on the evaluations carried out by the Member States. ·A public consultation that ran from 22 January 2018 to 20 April 2018 and obtained 720 replies.

·The European Economic and Social Committee (EESC) information report ‘Ex post evaluation of rural development programmes 2007-2013’. Additionally, findings published in Special Reports of the European Court of Auditors were used where relevant for this evaluation. 4.1.Method for the evaluation support study The evaluation support study is based on the Member States’ ex post evaluations. These were carried out by either external or in some cases in-house, but always functionally independent evaluators, based on a set of evaluation questions predefined at EU level. The Commission provided guidance on intervention logic, evaluation questions, indicators and evaluation methods via the publication of guidance documents, the setting up of an evaluation helpdesk and by providing a forum for the exchange of good practices via the creation of the Expert Committee on Evaluation of rural development programmes. Despite these efforts, the quality of the ex post evaluation reports were varying from one programme to another. As a first step, the evaluation support study had to provide a synthetic answer to a set of evaluation questions based on the replies given by each individual Member State to exactly the same set of standardised questions in their ex post evaluation of the rural development programmes. These questions were either: ·Programme related, assessing the effectiveness of the programme in reaching its objectives and the efficiency of the rural development programmes as a whole (‘programme related questions’), ·Measure related, assessing the effectiveness of the individual measures in the rural development programmes (‘measure related’). Additionally, a few questions addressed specifically the implementation and effectiveness of LEADER. Member States’ evaluators could select the evaluation methodology they found best suited, allowing them to take into account local circumstances. The Member States’ ex post evaluation reports contained both quantitative and qualitative information on target and implementation values (output and result indicators). However, the quantitative data could not be used to provide an overall judgment on the effectiveness of the implemented rural development programmes, as target values were adjusted multiple times during the life cycle of the programme. Moreover some of the adjustments made to the target values consisted of unnecessary reductions, resulting in multiple cases where ex post evaluations observed a degree of implementation (comparing implemented to target values) above 100%, sometimes even largely above this figure. Therefore the qualitative data provided in the ex post evaluation reports bore particular importance in the overall assessment of both the single measures and programmes performance. Therefore, the programme-, measure- and LEADER-related questions were assessed using three criteria: 1)Extent (of contribution): For each of the questions, the Member States’ evaluations were categorised by the contractor on the basis of the quantitative and particularly qualitative data provided in the ex post evaluation reports in relation to the measures’ impact as follows: - positive contribution; - limited contribution; - no contribution; - negative contribution; - not clear; - not measured.

Based on the share of reports that reported a positive conclusion over all those that provided a conclusion for the question at stake (so excluding those categorised in “not clear” or “not measured”), the extent was judged as - very limited if the share is 25% or lower; - limited if the share is 26-49%; - medium if the share is 50-75%; - high if the share is above 75%. 2)Plausibility: This measures if the judgement made on extent of contribution is based on sufficient evidence. Plausibility of the answers was based on the share of the ex post evaluation reports that provided a conclusion. Reports for which the contribution was not clear or not measured were considered as not having provided a conclusion. - very plausible: >85% of the reports provide a conclusion; - plausible: 50-85% of the reports provide a conclusion; - not plausible <50% of the reports provide a conclusion. 3)Certainty: Finally, for the programme related questions, certainty judges the quantitative assessment based on the completeness and comparability of the quantitative data: - certain: >80% of the regions/MS have comparable indicators; - partly certain: between 50-80% have comparable indicators; - not certain: <50% have comparable indicators. As a second step, the support study provided answers to eight synthesis questions. These covered the evaluation dimensions of effectiveness, efficiency, relevance, coherence and EU value added of the Rural Development Policy. The answers to these synthesis questions are based on the relevant programme, measure and LEADER evaluation questions in the Member States evaluations, as well as other sources of information such as input, output and result indicators. For each synthesis question, the relevant programme and measure related evaluation questions were identified. Then, using each time the answers to the relevant (programme and measure) questions, the number of answers indicating negative contribution is deducted from the number of reports stating positive contribution. The number of reports providing limited contribution have a score of 0.5 while reports indicating positive contribution have a score 1. All contributions (positive, limited and negative) are divided by the total number of reports used. For the programmer-related questions the total number is 91 while for the measure-related questions the total number is equal to the number of regions or Member States that implemented the measure. The calculation of the score follows the following formula: E = (P - N + C*L) / R The system leads to a final score that can reach values between 1 and 0; these are labelled as follows: Label Criterion High extent Score for the extent of contribution of 0.76 – 1 Moderate extent Score for the extent of contribution of 0.51 – 0.75 Limited extent Score for the extent of contribution of 0.26 – 0.50 Very limited extent Score for the extent of contribution of 0.01 – 0.25 No extent Score for the extent of contribution of 0

4.2.internet based public consultation Another source of information was an internet-based public consultation. This was online from 22 January until 20 April 2018 and generated 720 answers; the questionnaire contained open and closed questions and allowed for the upload of documents. After checking for campaigns, the questionnaire was analysed using the classical statistical tools (frequency tables, cross-tables). The results of the public consultation (see Annex 2. Stakeholder Consultation for a more detailed analysis of the public consultation) were used in this staff working document to corroborate the findings of the evaluation support study in particular as regards the answers to the synthesis questions. 4.3.European Economic and Social Committee Report A final source of information, as mentioned in the methodology, was the EESC information report on the “Ex post evaluation of 2007-2013 rural development programmes”. This aimed at assessing the effectiveness, relevance and EU value added of the measures in the 2007-2013 rural development programmes. This report, which from the onset was designed by the EESC as a complement to the Commission’s evaluation, focussed on three questions: ·What were the main shortcomings of the rural development programmer 2007-2013? ·What was the main added value of the rural development programmer 2007-2013? ·To what extent and how was civil society included in the rural development programmer 2007-2013? The report was based on: ·The information collected during fact-finding missions in 4 Member States. During the missions, the Members conducted semi-structured interviews civil society organisations to gather evidence of the practical experiences with the rural development programme. ·A consultation (online questionnaire) of organisations in 13 Member States on their views concerning the strengths and weaknesses of the programme implementation. The questionnaire was targeted at organisations representing aggregate interests rather than at individual citizens. 4.4.Limitations and robustness of findings The rural development policy was designed 17 years ago, well before the current better regulation context and its performance management. This meant in particular that the issues such as baseline, targeting and indicators (definition and data quality) and intervention logic had received considerably lower attention than nowadays. The evaluation was largely based on a synthesis of substantive results coming from the Member States’ ex post evaluations. Notwithstanding the help offered by the Commission to Member States in preparing the evaluations, a number of difficulties and limitations made it de facto very challenging to reliably assess the substantive results: ·Lack of capacity for evaluation and lack of harmonised evaluation methodologies used by the evaluators in the different Member States/regions; ·The uneven quality of and different level of detail in the different evaluations; ·The incompleteness or implausible values of some of the indicator data; ·The ex post evaluation reports’ quantitative information on target and implementation values (output and result indicators) could not be used to provide an overall judgment about the effectiveness of the implemented rural development programmes, as target values were adjusted multiple times during the life cycle of the programme. Moreover, some of the adjustments made to the target values consisted of unnecessary reductions, resulting in multiple cases where ex post evaluations observed a degree of implementation (comparing implemented to target values) above 100%, sometimes even largely above this figure. Therefore the multiple adjustments of targets during the programme implementation made the use of target indicators unreliable for benchmarking. These limitations led the external evaluator responsible for the support study to base the judgements largely on the approach explained above. The support study nevertheless presents quantitative information using result and impact indicators, but as explained by the evaluator in the report these should rather be considered as illustrations. This approach has its limitations: as it mechanistically compares the positive cases over the total, it cannot take into account the extent of the realisations of the rural development programmes; neither does it take into account whether or not the Member States’ evaluation could establish a causal relationship between the intervention and the result.

Despite these limitations, it is reassuring that the overall findings of the support study, the public consultation and the fact-finding done by the EESC are confirming each other in broad terms. 5.Analysis and answers to the evaluation questions As indicated in the evaluation roadmap, the evaluation conclusions are drawn on a summary of the replies to the complete set of revised common evaluation questions of the 2007-2013 ex post evaluations carried out by the Member States and the set of evaluation questions. This entails that the evaluation support study treats in total 53 evaluation questions, most of them further broken down in sub-questions. The report is supported by drawing analysis from the EESC report as well as from internal DG Agriculture and Rural Development data and other EU Commission data sources (Eurostat). 5.1.Effectiveness Effectiveness is measured through the achievement of the objectives and the extent to which it is due to the rural development programmes. The results, and the assessment of the impact made by the rural development programmes described in this Staff Working Document have to be considered in the context of the overall economic, social and environmental situation and trends in the rural areas, which were in the middle of the programming period also hit by the economic crisis. The December 2013 Rural Development Report presents a comprehensive set of data describing the situation at the end of 2013. For later years, information is published online. The following information is derived from these sources, unless otherwise indicated. 5.1.1.Axis 1. Improving the competitiveness of the agricultural and forestry sector Axis I measures aimed to boost modernisation and competitiveness in the agricultural sector, which would lead to economic development. Particularly investments aiming to improve productivity, efficiency and sustainability are key to increase GVA in the primary sector while also creating positive spill-over effects on the economy. Axis 1 also targeted employment in agriculture, and promoting knowledge transfer and training, which led to the employment of young people in sectors other than the primary sector. 5.1.1.1 Productivity Agricultural labour productivity increased drastically during the programming period (+48%), from EUR 11 887 per annual work unit (AWU) in 2006 to EUR 17 585 /AWU in 2015. Moreover, total factor productivity grew by 8.5% over the same period ( Figure 6 ). However, there still are important disparities between Member States: in 2015 labour productivity in agriculture varied from EUR 4 015 /AWU in Latvia to EUR 68 402 /AWU in the Netherlands. Besides differences in level, there are also strong differences between Member States in terms of development: while in Estonia productivity more than doubled to 12 345 EUR /AWU in 2015, in the same timespan it decreased in Malta from EUR 14 309 /AWU to EUR11 612 /AWU. The increase in productivity was driven by the replacement of human capital by machinery. It was thus accompanied by a decrease in the total number of agricultural holdings, from 13.8 million in 2007 to 10.8 million in 2013, pointing towards a concentration of UAA (Utilised Agriculture Areas) in larger farms (those holdings of 100 ha or more). Over the same period, factor income per AWU increased by 39% in real terms. Income in agriculture increased faster in the Member States which joined the EU after 2004, in line with the strong productivity gains after accession, supported by the rural development policy (151% average increase). Source: DG Agriculture and Rural Development Member States have spent EUR 30 billion in measures aiming at improving competitiveness mainly through investments in farm modernisation (M121), adding value to agricultural and forestry products (M123), and improving infrastructure in rural areas related to the development and adaptation of agriculture (M125) ( Figure 7 ). A majority (59%) of the Member States/regions stated in their ex post evaluation reports that the effects of the policy on competitiveness were positive. These effects can be attributed mainly to trainings and investments in modern machinery and technology. This is confirmed by the results of the public consultation, distinguishing clearly between the positive impact on competitiveness in agriculture, which is judged more favourable than in the ex post evaluations with 74% of positive views and forestry, with not as strong positive views (44% of positive views). There were no major difference of opinion between stakeholder groups.

Note: M111 corresponds to vocational training and information actions; M112, setting up of young farmers; M113, early retirement of farmers and farm workers; M121, modernisation of farms; M123, adding value to agricultural and forestry products, M125, improving infrastructure related to the development and adaptation of agriculture and forestry Source: DG Agriculture and Rural Development Some rural development programmes attempted to quantify the impact of the rural development policy on competitiveness in the agricultural and forestry sector. Based on these figures, the support study estimated that EU labour productivity increased by 4.1% thanks to the rural development policy (the median was +3.2%) and concluded that the objective of higher competitiveness was achieved to a moderate extent. On the other hand, the support study could not conclude on the contribution of the rural development policy to improved competitiveness in the overall rural economy, due to the limited number of reports (18%) including data result indicators and the high variability of the results (-6% to 17% ). Many rural development measures have a significant impact on the competitiveness of the agricultural and forestry sector. M121 (modernisation of farms) had a total expenditure of EUR 11.7 billion, implemented by 27 Member States across 88 regions. The main aim of the measure was to modernise the technology, management and practices that are applied in agricultural holdings. This measure supported 467 324 investment operations in the equivalent of 4% of EU holdings. The overall investments led to an increase in GVA in the supported holdings of EUR 19.3 billion (11.1% of the agricultural sector GVA). These results were confirmed by the qualitative analysis, explaining that the competitiveness was increased in multiple ways: 39% of the ex post evaluations found an increase of GVA, 31% an increase of labour efficiency, 21% the introduction of new or better products, and 21% the introduction of new technologies. Furthermore, of those reports that provided a conclusion on M121 (86% of the total), 83% stated a positive contribution. Thus, the support study concluded that the measure contributed to an improved competitiveness to a great extent. Another significant measure is M123 (adding value to agricultural and forestry products), with a total level of expenditure of EUR 4 413 million, supporting 28 265 enterprises. The aim of the measure was to modernise operations, introduce innovative procedures and promote the integration of value chain segments to increase the value added of agricultural and forestry products. It was implemented by 25 Member States in 85 regions and contributed towards two result indicators, one of which is the increase in GVA in supported enterprises that equaled EUR 30 billion (17.4% of the GVA of the agricultural sector in 2015). The other result indicator ‘number of holdings with new products and/or techniques introduced under M123’ amounted to 14 484 holdings supported under this measure (0.1% of the total agricultural holdings in the EU). The qualitative analysis confirms this result, as 76% of the reports found that the measure had a positive contribution to competitiveness. The support study concluded that this measure contributed to a great extent to an improved competitiveness. In addition, under M125 (improving infrastructure related to the development and adaptation of agriculture and forestry) the investments were aimed at roads and irrigation systems. The measure was implemented in 24 Member States with 71% of the reports that provided a conclusion on it stating a positive contribution. Out of all the reports signalling a positive effect on increasing competitiveness, 27% attributed it to improved road structure and access, which resulted in reduced costs of transportation along the value chain and 26% attributed it to the new irrigation structures, which significantly reduced the cost of water. Overall, M125 supported 56 779 operations and generated a value added of EUR 7 billion, making it one of the most successful measures in generating value added, 4% of the total GVA for the agricultural sector in the implementation period. M113 (early retirement of farmers and farm workers) promotes competitiveness by supporting farmers and farm workers with early retirement, allowing access for younger farmers to farms and farmland. It allows young farmers to profit from economies of scale through the expansion of their company, and/or improving old farms through the introduction of modern farming techniques. EUR 2.7 billion was spent on Measure 113 by 16 Member States across 51 regions, resulting in an output of 28 398 farmers and 231 farm workers with early retirement, and 493 516 hectares of land released. Out of the total number of farmers, 0.1% has enjoyed early retirement under M113. Out of the total amount of arable land in the EU, 0.3% was released. Several case studies, like Andalusia and Aragón, showed that the early retirement led to an increase in competitiveness in the agricultural sector. 83% of the rather small number of ex post evaluation reports analysing the measure found that if contributed positively to improving the competitiveness of the beneficiaries. Although the evaluation support study found that the measure contributed to an improved competitiveness to a great extent, it also concluded, along with the Evaluation on Generational Renewal that there is very weak or no correlation between support for early retirement (M113) and the change in the number of young farm managers. The ratio of young farmers per elderly farmers did not change between 2007 and 2013 and stayed at 19 young farmers (under 40) per 100 elderly farmers (those older than 65). The measure was also discontinued in the current programming period, as it was not suited to older farmers’ specific needs and in addition, the measure was criticised also by the European Court of Auditors for being cost-inefficient. Young farmers stimulate competitiveness as they are more inclined to modernise farms, introduce new methods and techniques, and start innovative processes. Thus, it was the aim of M112 (setting up of young farmers) to set up young farmers, either through supporting the creation of a self-owned business, or through employment in already existing businesses. It was implemented by 24 Member States across 69 regions, with a total expenditure of EUR 3.3 billion. The total number of farm managers under the age of 40 supported to set-up was 192 003. Of those reports that provided a conclusion on M112 (59), 78% stated a positive contribution on competitiveness from the increase of young farmers in agriculture, producing an increase of gross value added of EUR 6 131.8 million in these Member States/regions (3.6% of the GVA in the agricultural sector in the EU-28 in 2015 level). Therefore, the support study concluded that the measure contributed to a great extent to an improved competitiveness. A total budget of EUR 840.5 million was spent on M111 (vocational training and information actions) by 26 Member States across 75 regions. Outputs of 6.4 million participants in training and 6.8 million days of training were reported, representing 29% of active farm workers in the EU as a whole. However, this comparison is not straight forward as the same farmers may have participated several times in training activities. Furthermore, the result indicators for this measure show that, out of the 6.4 million participants, 1.86 passed trainings by achieving a certificate, degree or diploma (on average 80 971 per MS) and 1 987 552 implemented the achieved skills (on average 132 503 per MS). The support study concluded that this measure contributed to a moderate extent to an improved competitiveness. Member States also assessed the impact of rural development programmes on milk, which is presented in detail in Box 1 . Box 1. Dairy sector re-structuring In their ex-post evaluations, Member States had to assess the contribution of the rural development policy to the restructuring of the dairy sector, in view of the abolition of the milk quotas in 2015. Following the milk crisis of 2009, 2010-2013 was a recovery period in most Member States. Despite the decrease in number of dairy cows throughout the EU (from 22.4 million in 2006 to 21.4 in 2015), the milk yield increased by 11% in the 2006-2015 period. Furthermore data from the Farm Structure Survey shows that the number of cows per farm increased by 52% from 2005 to 2016 (32 dairy cows per farm to 49). Additionally, this concentration is seen in the UAA, increasing from 27 ha per farm in 2005 to 38 ha in 2016. Source: DG Agriculture and Rural Development, Agricultural outlook report data The role of the rural development policy in this development is not always clear and only qualitative data was available in the rural development reports (as there was no impact indicator assigned to the objective of restructuring of the dairy sector). Of the 91 ex-post evaluation reports 24% indicated positive effects on the restructuring of the dairy sector, mainly due to the investments in farm modernisation and in the processing sector. Another 19% reported limited or low effects and in 19% of these reports the impact was not clearly described. 38% of the ex-post evaluation reports did not assess the effects on the restructuring of the dairy sector. The positive impacts of the policy are mainly linked to measures M121 (Modernisation of agricultural holdings) and M123 (Adding value to agricultural and forestry products). The modernisation processes (as an indicator for the restructuring process) were in many cases combined with an increase in herd size and a parallel decrease in dairy farm numbers. Only in a few cases, alternatives were described, e.g. how organic farming can be a reorientation for agricultural holdings or how M214 (agro-environment-climate) could offer a restructuring perspective for conventional dairy farms under income pressure. 5.1.1.2 Employment in agriculture During the programming period, employment in the primary sector has further decreased. In 2016, the farming sector was employing 9.5 million workers, a figure 25% below 2007. This decline is, nevertheless, 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, while in Slovakia, Romania, Estonia and Latvia in particular between 2005 and 2011. At the end of the implementation period, in 2015, agriculture still accounted for 4.17% of employment in the EU-28, down from 4.85% in 2008; for forestry these figures were stable at 0.25%. Member States/regions reported in the ex post evaluation the number of jobs created thanks to the rural development policy under result indicators RI8.1 (gross number of jobs created in agriculture) and RI8.2 (gross number of jobs created in forestry). They amounted to respectively 1.1% and 1.0% of the total number of people working in agriculture and forestry. As regards the employment of young farmers, both the evaluation support study and the Evaluation Staff Working Document on Generational Renewal , (as confirmed by the CAP Performance report ) found that the generational-renewal measures (direct payments, setting-up and investment support) do not influence significantly the number of young farmers across the EU as a whole. They mainly target the maintenance or protection of farming jobs, particularly in marginal areas, rather than the creation of new farming jobs. 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 highlighted that the CAP supported the creation of better (i.e. more remunerative) jobs for the workers who remained behind in agriculture, while it improved quality of life and reduced poverty in agricultural areas.

The JRC analysis on the CAP’s impact also concluded that all CAP support and particularly CMO and direct payments had a large causal impact on safeguarding employment in agriculture. 5.1.2.Axis 2. Environment and the countryside The status of natural resources deteriorated over the programming period. Nevertheless, Member States/regions reported positive contributions from the rural development policy, suggesting that the deterioration of natural resources would have been worse without the policy, notably because of land abandonment. On this basis, the evaluation support study concluded that the rural development programmes contributed to better water management, to a moderate extent to the protection of natural resources and landscape and to climate change mitigation to a low or unclear extent. Regarding the supply of renewable energy, despite the positive impact, the extent of it was difficult to determine and quantify. The EESC report on the “Ex post evaluation of rural development programmes 2007-2013” also concluded that rural development programmes played a big role in promoting more environmentally-friendly production methods in agriculture. The public consultation also pointed to the positive impact on the environment: (75% positive views) and on the countryside (74% positive views), with no major difference between stakeholders’ opinions. Over the programming period, Member States spent EUR 44.7 billion on environmental measures. The share of agricultural area under beneficial farm practices supported by the CAP was: 46% for biodiversity, 30% for water quality, 35% for soil, 30% for water quality and 49% for the avoidance of marginalisation and land abandonment. Note: M211 corresponds to natural handicap payments to farmers in mountain areas; M212 payments to farmers in areas with handicaps other than mountain areas; M213, Natura 2000 payments and payments linked to Directive 2000/60/EC; M214, agri-environment payments; M215, animal welfare payments; M221, first afforestation of agricultural land; M226, restoring forestry potential and introducing prevention actions Source: DG Agriculture and Rural Development 5.1.2.1.Protection and enhancement of environment, landscape and forestry Over the programming period, the Farmland Bird Index continued its downward trend (except for forest species). The share of estimated agricultural area affected by moderate to severe water erosion (>11 t/ha/year) stood at 6.7% of total agricultural area in 2010. The soil mean organic content decreased slightly from 43.28 g/kg (in 2009) to 43.10 g/kg (in 2015). By contrast, nitrates surplus, affecting water quality, reduced on average by 15.8 kg N/ha/year. In addition, the area under organic farming increased by 10% from 2012 to 2015 to 6.2% of the UAA. In 2015, EU-28 UAA stood at 179 million hectares, 3.7% below the 2006 baseline. Permanent grassland and meadow, key for carbon sequestration and biodiversity, remained stable at 33.8% of UAA. The share of the different land cover categories varies across the EU and is correlated with the physical characteristics of the territory such as mountains and remoteness of the area. Nevertheless, the total area used for extensive grazing increased significantly between 2007 and 2013, from 20.6% of the total UAA in 2007 to 29.4% in 2013. 61% of the ex post evaluations reported positive effects on the protection and enhancement of natural resources and landscape, particularly biodiversity and High Nature Value farming and forestry, through measures preventing land abandonment. The programmes were either said to improve the situation or prevent further degradation. Source: DG Agriculture and Rural Development on the basis of Agridata (CTX_ENV_35_1) M214 (Agri-environment payments) was of key importance with respect to protecting natural resources and biodiversity, as all programmes have implemented this measure, and it accounted for the largest proportion of expenditure (26%). Almost 90% of reports giving a clear judgement on this measure concluded that its implementation made a positive contribution to the environment, through both the extent of area covered by commitments and their effectiveness. Biodiversity and High Nature Value farming were identified as most significantly positively affected (69%), improved soil quality in 66% and water quality in 61% of reports. Overall, Member States spent EUR 23.6 billion on different operations aimed at improving the environmental situation. Most regions have implemented a variety of sub-measures with different focuses, which involved more than 1.5 million farms (14% of the total) and more than 12 000 other land managers. The measure concerned 48 million hectares and 0.97 million livestock units (0.7% of the total livestock units in the EU); as well as: -42.5 million ha under land management beneficial for biodiversity. Organic farming and extensive cultivation methods (including the renunciation of biocides), especially extensive grassland management, are favourable cultivation methods for the promotion of biodiversity. Furthermore, positive impacts on biodiversity were explicitly attributed to the promotion of beekeeping and to the support of the use of indigenous breeds at risk of extinction on livestock farms, among others.

-35.7 million ha under land management beneficial for water quality (see I mprovement of water managem ent , below, for more detailed information), -36 million ha under land management beneficial for soil quality. The effects were mainly attributed to the introduction of organic farming and livestock and extensive grassland management, though only a few partial measures are aimed directly at soil protection. However, all contractual nature conservation measures as well as measures with the main objective of improving water quality contributed to the protection or improvement of soil. -19.6 million ha under commitments to avoid marginalisation and land abandonment. Rural development programmes shown that organic farming, extensive grassland management and contractual nature conservation measures in particular prevent marginalisation and land abandonment. Nevertheless, although most of programmes reported on the impact of this measure, only 25% of the evaluation reports rated its contribution to avoidance of marginalisation and land abandonment as positive. Based on these findings the evaluation support study concluded that the measure contributed to the improvement of the environmental situation to a high extent. Some of the other most relevant measures under Axis 2 were M211 (natural handicap payments to farmers in mountain area) and M212 (payments to farmers in areas with handicaps, other than mountain areas). They compensate farmers for the additional costs and income losses arising from the difficulties of agricultural production in areas with handicap. Their core objective is preventing land abandonment, to which they contributed positively for 60% of the Member States/regions. These measures were implemented in 25 Member States and covered 52.8 million ha. M211 was implemented in 15 Member States in a total of 60 regions, with a total budget of EUR 7 391.1 million. The measure resulted in 1 million (9.7% of the total agricultural holdings in 2013) supported farm holdings and 16 million hectares covered (one Member State implementing the measure did not report the output indicators). This amounted to 57% of the UAA in the less-favoured mountain areas of the Member States that implemented the measure and to 56.7% of the UAA in mountainous areas in the EU as a whole. Over two thirds of the reports stated that it made a positive contribution to the environment (especially biodiversity and high nature value farming/forestry), mainly through maintaining extensive agricultural systems in areas where appropriate land management is important for biodiversity and High Nature Value habitats. It was also recognised as helping retain population and employment in fragile rural areas. The support study concluded that the measure contributed to an improvement of the environmental situation to a high extent. M212 (Payments to farmers in areas with handicaps, other than mountain areas) was implemented in 27 Member States in 75 regions, with a total budget of EUR 7 681 million. On average, Member States spent 10% of their total EAFRD expenditure in Measure 212, with wide disparities. This resulted in an output of 1.8 million supported farm holdings (17% of the total) and 36.8 million hectares covered, corresponding to 59% of the UAA in the less-favoured areas other than mountain areas of the Member States that have offered the measure. The majority of the ex post evaluation reports that assessed it, confirmed the measure’s positive impact on improving the environment through prevention of land abandonment. The positive impact is mainly attributed to its support to maintain agricultural cultivation on sites, which otherwise would have been threatened by land abandonment and a possible degradation of natural values. Some reports also stated that the measure promoted extensive farming practices. Both measures’ main environmental effect was on biodiversity and high nature value farming/forestry, with 28% of the Member States and regions quoting a positive impact on biodiversity, while 14% a rather limited impact, 17% no contribution, 10% unclear (14% did not assess this aspect). This is due to the fact that the maintenance of local agricultural techniques is a basis for the conservation of animal and plant communities dependent on this management and that the measure covers ecologically valuable areas. Additional positive effects resulting from the implementation of these measures on other natural resources (soil, water) and climate mitigation are possible but not plausible according to the analysis in the evaluation support study. Another significant measure was M213 (Natura 2000 payments and payments linked to Directive 2000/60/EC), which with a total expenditure of EUR 267.5 million supported farmers’ incomes in more than 75 000 supported farm holdings (0.7% of the total EU farms), in 13 Member States that implemented it on 1.1 million hectares (28 rural development programmers, 15.3% of agricultural area in Natura 2000 of the Member States that have offered the measure). It compensated them for financial losses due to using different farming practices beneficial for the designated habitats/species. Whilst the management practices are compulsory, even without these payments, positive effects on biodiversity were reported due to improved understanding and acceptance of Natura 2000 requirements and high coverage of target areas. The actual effects on the environmental aspects were not clear (on soil, mitigation and adaptation of climate change and prevention of land abandonment) except for biodiversity, which was generally considered somewhat more positive than the overall environmental impact. In 28% of the ex post evaluation reports the general contribution of M213 to improving the environment was assessed as positive, while 31% stated a limited effect and 17% saw no contribution. 10% of the evaluations of the measure indicated that the effect was not clear (and 14% did not carry-out the assessment). The support study concluded that the measure contributed to an improvement of the environmental situation to a limited extent. 20 Member States spent EUR 1.6 billion on M221 (first afforestation of agricultural land) and reported on it in 63 ex post reports. In addition to the afforestation of agricultural land and the expansion of the entire forest area, the measure also pursued the goal of introducing sustainable forest management in these areas. This measure reached a total output of 203 944 hectares of afforested land in 42 531 supported actions, representing 0.12% of the total forest and wooden lands (FOWL). Nevertheless, to the improvement of the environmental situation mostly regarding biodiversity, mitigation of climate change and water quality. This was largely attributed to the diverse and various ecological functions of forests and hence the afforested areas were often assessed positively without further consideration. Another measure under this axis was M226 (restoring forestry potential and introducing prevention actions), with a total expenditure of EUR 1 542.1 million, was assessed as highly positive for the environment, mostly through preventing fires and flooding. These actions, implemented by 16 Member States across 56 regions, supported 10 million hectares of damaged forests (for a total of 77 359 actions). In 78% of the positive cases the improvement of the environmental situation was attributed to the fields of fire damages and prevention. Improved water quality and flood mediation and biodiversity were also pointed at. On the basis, the evaluation support study concluded that the measure contributed to the improvement of the environmental situation to a medium extent. 5.1.2.2.Climate change mitigation, adaptation and renewable energy In 2015, agricultural emissions of greenhouse gases (GHG) in the European Union amounted to 494 million tons of CO2 equivalents. This accounted for about 12% of total EU-28 emissions for that year. While total net emissions from agriculture declined by 3% compared to 2006 baseline, the share of agriculture in GHG emissions showed an increase over the last years. This is due to the decrease in total GHG emissions in the overall EU economy, greater than the decrease of agricultural emissions. Source: DG Agriculture and Rural Development (IMP_07_2 and IMP_07_1) The production of renewable energy from agriculture increased by 600% between 2006 and 2015, to 292 million MWh. Only a reduced number of Member States (7) reported quantitative figures on energy production and the reported production capacity installed thanks to rural development support was small (614 779 MWh for the 2007-2013 period). Therefore the contribution of rural development programmes towards the supply of renewable energy (on just the basis of energy production) is not certain. Despite the data limitations, the qualitative data shows that the rural development programmes positively contributed to the supply of renewable energy, but only to a very limited extent (in 12% of the Member States/regions). In the majority of these regions, this positive development is based on the support for biogas and biomass energy. In some regions, investments in solar energy and distribution systems contributed to an expansion of renewable energies. For another 42% of reports, positive effects were reported, however with an unclear extent. Limited effects were reported for 26% of the regions.

Although renewable energy production was not the specific focus of any rural development measures, the ex post evaluations reported on it in relation to measure M114 (use of advisory services by farmers and forest holders) and M311 (diversification to non-agricultural activities). The ex post evaluation reports indicated that Member States or regions enhanced the transition from fossil sources to renewable biomass based sources, installed renewable energy production plants or generally produced energy from renewable sources through M311. As regards climate change mitigation and adaptation, overall only 6% of the Member States/regions reported on the environmental measures’ positive effects in relation to mitigation, which were however seen rather as a side effect than as a result of clear targeting in the rural development programmes. Positive effects, however with an unclear extent, are found in 69% of regions. For another 19% limited effects of climate change mitigation and adaptation are stated. The following measures were identified as positively contributing: forest-related measures like afforestation and forest management, agri-environmental measures and measures concerning energy-savings and the production of renewable energies. Member states reported in their rural development programmes a reduction of GHG emissions of 742 849 tons CO2eq per year, thanks to the rural development policy.. Compared to agricultural emissions, the reduction represents 0.15% of the agricultural emissions in 2015. The reported level of carbon sequestration sums up to 349 387 Mega tons CO2eq/a, resulting from measures on woodland and agricultural land. Compared to the assumed overall potential of carbon sinks in forests and croplands in the EU, the rural development programmes’ contribution accounts for a share of 0.08%. The total area under land management contributing to mitigating climate change supported by the rural development programmes amounted to 4 813 km² (0.15% of the total area of agriculture and forestry in the EU-28, 3 220 159 km²). The support study concluded that M214 (Agri-environmental payments) had a positive impact on climate protection through the reduction of greenhouse gas emissions, but the effect was very limited, only indirect and difficult to measure, given especially that climate protection was not the focus of these measures, although M214 covered 25.5 million hectares with measures contributing to mitigating climate change. M221 (first afforestation of agricultural land) also positively contributed to climate mitigation, according to the ex post evaluations. Through site-specific afforestation and sustainable use, forests can be established as a long-term carbon sink. The contribution of the measure to mitigating climate change was assessed as predominantly positive (46% of the reports). Particular emphasis was placed on the positive effects on CO2 storage function in biomass and soil of the newly established forest stands (73%), but also the long duration and slow process should be kept in mind (12%). Afforestation further reduces greenhouse gas emissions as it generally introduces a more extensive management on the area (23%). Another measure with positive effect was M215 (animal welfare) and it was also explicitly mentioned in the ex post evaluation reports through the consolidation of environment-friendly farming practices, related to extensification and low livestock density. Most of the other measures under this axis also showed to have effect on climate mitigation, but based on the analysis made by the contractor and the low number of reporting Member States, climate mitigation was achieved as an indirect effect of these measures. 5.1.2.3.Improvement of water management The total irrigated area barely increased from 2007 to 2013, from 173.7 million hectares to 174.6 million hectares. In 2012, the share of monitoring sites of nitrates in groundwater with a poor quality stood at 11.7%% and 14.2% with moderate quality, and for surface water at 11.4% and 31.7% respectively . In 2013 the pressure from agriculture was decreasing, although not uniformly, in terms of numbers of animals and the consumption of inorganic fertilisers, continuing a long-term trend . The ex post evaluation reports do not use the term “water management” in a uniform way, leading to a very different approach to the evaluation of use, quality and quantity of water. Furthermore, ex post evaluations very rarely reported on those issues and with a significant lack of consistency in the use of measurements. Therefore, the effects of the CAP on water use and water quantity could only be assessed qualitatively and with difficulty. Nevertheless, overall more than half of the ex post evaluation reports indicated that the rural development programmes positively contributed to water management. Out of 91 Member States/regions, 64% suggest positive impact on water management, and 16% limited or no impact. 20% of evaluations did not provide information or stressed that such an impact could not be assessed based on the available data. As it was mentioned before, M214 (Agri-environmental payments) was a key measure also for water quality improvement. The area under successful land management contributing to water quality was 35.7 million hectares in 27 Member States, making it the most widespread measure in regard to water quality. 61% of the ex post evaluation reports found positive contributions of this measure to the quality of groundwater and surface water, although the protection of water resources was not emphasized in all sub-measures. M214 was focused on the reduction of nitrogen input into groundwater, but reports also described indirect positive impacts in the reduction of nutrient and pollutant inputs in surface waters (phosphorus). In addition to the reduction of fertilizer and pesticides, the most successful instruments were promoting adapted soil cultivation, permanent covering/vegetation strips, low-emission spreading technology, preservation of semi-natural pasture habitats, retention dikes. 18% of the ex post evaluation reports attested that M214 had a limited contribution to water quality, mainly because the effects were only indirect and difficult to assess. No contribution to water quality was seen in 5% of the evaluated reports, 10% could not clearly identify a contribution. An indirect contribution to water management came from M121 (modernisation of agricultural holdings), as it fomented innovation, and 27% of the ex post evaluations referred specifically to environmental benefits coming mostly from water management and green technology, and another 16% to environmental benefits coming from innovations. Another measure that the ex post evaluation reports highlighted as contributing positively towards better water management, was M125 (improving infrastructure related to the development and adaptation of agriculture and forestry), by promoting investments in newer irrigation systems that allowed for better use of water resources, reducing the overall water consumption. The direct impact of many other relevant measures in water management, even when potentially positive, was deemed as not possible to substantiate by the analysis made by the contractor for measures such as support to areas with handicaps, mostly due to the very low number of Member States/regions reporting on water management and water quality, and low number of clear positive impacts in the ex post evaluations. 5.1.3.Axis 3. Improving the quality of life in rural areas and encouraging diversification of the rural economy Member States spent EUR 11 billion in measures aiming to improve quality of life in rural areas and encourage diversification of the rural economy, mainly through support to investments in basic services for the economy and rural population (M321) and for village renewal and development (M322). Relatively few rural development programmes contributed to both aspects of Axis 3 and a larger number contributed to either quality of life or diversification. Note: M311 corresponds to diversification into non-agricultural activities; M312 to support for business creation and development; M313 to encouragement of tourism activities; M321 to basic services for the economy and rural population; M322 to village renewal and development; M323 to conservation and upgrading of the rural heritage; M331, training and information; M341 to skills-acquisition and animation measure with a view to preparing and implementing a local development strategy. Source: DG Agriculture and rural development

Out of the four objectives of rural development policy, this is the objective for which the evaluation support study concluded to the most limited degree of achievement, but it is also the one for which there are fewer measures with a direct effect and the lowest evidence in Member States/regions reports, as well as low quality data. 5.1.3.1.Growth and diversification of the rural economy The importance of the primary sector in the total economy (EU-28) has slightly decreased from 1.66% of total GVA in 2006 to 1.6% in 2016. Rural areas’ importance in the overall economy also decreased, representing 9.5% in 2006 to 12% in 2015. Roughly one third of all EU farmers (34%) were engaged in gainful activities other than their farm work in 2010. For the vast majority of farmers engaged in other gainful activities, these were the main source of income, according to the support study. The importance of the tertiary sector (services) in employment increased during the period 2006-2015 while the one of the primary sector decreased further. In 2015, it accounted for only 4.7% of total employment (from 5.8% in 2006). In rural areas it declined from 15.7% to 11.8%, in intermediate areas from 6.5% to 5% and in urban from 1.2% to 1%. Note: Primary sector covers agricultural production, forestry, fishing and mining; the secondary sector refers to manufacturing, the tertiary sector are services. Source: DG Agriculture and Rural Development on the basis of Eurostat The impact on the quality of life was commented on in 47 ex post evaluation reports. The positive effects can be mainly attributed to basic infrastructure services (e.g. mobility and communication) and the social dimension (such as governance, social sustainability). The impact on the diversification of the rural economy was commented on in 37 ex post evaluation reports. The non-agricultural sector most often mentioned was tourism. Only half of the ex post evaluation reports provided qualitative data regarding the contribution of the rural development programmes to the growth of the whole rural economy. The qualitative data provided in the rural development programmes show that the policy had positive effects on economic growth in 57% of the Member States/regions. These effects can be attributed mainly to investments in modernisation and labour productivity, as well as to investments in human capital. Although 20% of the reports found that the rural development programmes had limited effects on the growth of the rural economy, at least 9 evaluations noted that they have mitigated the effects of economic recession in a significant way, by limiting the loss of jobs and the decrease in the number of farms. Based on the limited quantitative overview, the contribution of the rural development programmes to improving the quality of life in rural areas and encouraging diversification of the rural economy is not certain. However, the qualitative overview indicates that the rural development programmes have contributed to a very limited extent. One of the measures impacting most economic diversification has been M311 (diversification to non-agricultural activities). This measure was implemented by 20 Member States across 65 regions and a total budget of EUR 1.1 billion. This resulted in a total of 41 940 beneficiaries, though amounting to less than 0.5% of the total number of holdings in the EU. Investment on this measure increased GVA in supported businesses by EUR 563.6 million, and created 27 881 jobs. In addition, 52% of all the ex post evaluations found the measure to have a positive impact on improving the economic diversification of the beneficiaries, contributing to the stabilisation of farms, enabling farmers to increase their overall performance, assisting farm households to maintain or increase their income, supporting farms to maintain employment or even to create new jobs. In order to improve the quality of life in rural areas, EUR 3.7 billion was spent by 23 Member States across 70 regions on M321 (basic services for the economy and rural population). This produced an output of 63 215 supported actions, and in the Member States that have offered the measure, there has been one action per 1 298 person (1 545 at fully EU level) in relation to the total population of the rural area. Furthermore, more than 45 million persons benefitted from improved services in rural areas and more than 16 million persons benefitted from improved internet coverage in rural areas The positive impact was confirmed 58% of the qualitative ex post evaluation reports, which found that the measure positively contributed to improving the quality of life of the beneficiaries. Life quality improvements came from social infrastructure investments (within the thematic complex of day-care, schools, families, community facilities as well as health), as well as further internet access (see rural development p rogramme ’s contribution to the creation of access to broadband internet for more detailed information on the topic). Furthermore, waste/drinking water infrastructure, electricity and heat were named, as well as the field of transport and roads, as being improved by this measure. In terms of the sectors in which the quality of life was improved, the focus was on the ‘(public) services’ sector in general (64%) and on the social dimension (16%). M322 (Village renewal and development) was implemented by 50 regions in 22 Member States, with a total spending of EUR 3.2 billion. Its objective was to counteracting population decline by making villages attractive places to live and work, and promoting business activity. The implementation of this measure resulted in 41 577 villages were actions took place for 40 million persons. In relation to the total population of the rural area, in the Member States that have offered the measure, there has been one action per 1 651 person. The ex post evaluation reports confirmed that the measure contributed positively to improving the quality of life of the beneficiaries in 77% of the Member States which reported on this measure. The improvement can be mainly attributed to intangible aspects (such as social cohesion, political participation, collective ownership in shaping the community environment, or local/regional identity), infrastructure (such as meeting places), the attractiveness of villages for housing and technical and traffic infrastructure (including waste/drinking water infrastructure, roads and other public spaces). 5.1.3.2.Job creation in Rural Areas The rural employment rate for the age group from 15-64 year olds slightly increased, from 63.3% in 2006 to 65.0% in 2015 halving the gap with the overall employment figures which stood at 64.3% in 2006 and 65.6% in 2015. The quantitative data shows that the rural development programmes contributed to create more than 159 000 new jobs, not just in the primary sector but also in the entire economy. It should be mentioned that the validity of these results could be diminished as only 45% of the reports provided data on the number of jobs provided and it does not account for the support to generational renewal and to the maintenance of farmers in agriculture. While the largest share of new jobs was created in the agricultural sector, most reports concluded that the programmes helped the creation of new jobs in other sectors, particularly food and tourism, but also culture and services.

The qualitative data shows that 48% of the rural development programmes had a positive effect on the creation of new jobs, which is reflected by the quantitative results too. Furthermore, the reports highlighted the important role of the rural development programmes in limiting the effects of the economic recession on the job market, and in preserving existing jobs. Even when the creation of employment happened mostly in the agricultural sector, reports acknowledged that rural development programmers also led to the creation of new jobs in other sectors and especially food and tourism. The creation of employment prospects, especially for young generations in rural areas also limited the abandonment of farms, notably in mountainous regions. M322 (village renewal and development) was identified as having a positive impact for non-beneficiaries as well as beneficiaries of the support, and in 85% of the ex post evaluation reports, additional economic effects were named (mainly jobs and diversification). M313 (encouragement of tourism activities) allowed for the creation of tourism actions (24 518 created) and jobs 17 578 in 22 Member States that reported. Other measures, like M323 (conservation and upgrading of the rural heritage) or M321 (Basic services for the economy and rural population) also indirectly impacted job creation in rural areas, though they did not have associated job related result indicators, and therefore their impact cannot be quantified. The European Economic and Social Committee showed in its report that rural development programmes contributed to maintain agriculture and promoted competitiveness of rural businesses and employment and diversified rural economies. The public consultation pointed also to a positive impact on the quality of life: (75% a positive contribution) and the countryside (74% a positive contribution), with no major difference between stakeholder groups for none of the questions. These results contrast with the qualitative data stemming from the ex post evaluation reports, where only 18% of the 91 Member States/regions identified a positive impact for both domains (i.e. quality of life and diversification) and 9% identified a limited impact. The recent JRC study on the effects of the CAP proved the positive effect of the CAP in general and of rural development policy in particular (see Box 2) with regard to not only safeguarding employment in agriculture, but also creating jobs in rural areas. 5.1.3.3.Introduction of innovative approaches The rural development programmes helped introducing innovation across different areas in 55% of the target regions through modernising infrastructures and introducing new technologies and products, as well as by introducing changes in behaviours and processes, especially thanks to LEADER solutions and concepts. However, not all measures contributed to introducing innovative approaches and 26 reports found that rural development programmes had a small or no impact on innovation. The fact that the programmes had a different way of defining innovation posed some challenges to the achievement and measurement of such results. In addition, several reports pointed out that innovation was not a specific objective of the policy. From a quantitative perspective, the contribution of the policy to the introduction of innovative approaches was small, 33 027 holdings introduced innovative products and techniques thanks to CAP support, which only accounted for 0.3% of the total agriculture holdings in the EU in 2013. Besides, there were very large differences registered across the programmes, where the number of holdings introducing innovation variated from 23 to 20 000 (these figures are based on 15% of the regions/Member States collected good quality data). The qualitative data indicates that the rural development programmes have contributed to a medium extent to the introduction of innovative approaches. One of the measures that provided some innovative approaches to beneficiaries in rural areas was M331 (training and information), implemented by 32 regions in 13 Member States, with a total expenditure of EUR 92.2 million. More than 700 000 training participants completed a training successfully. The total number of participants that successfully ended a training activity accounted for 5% of the total number of people employed in agriculture, food and forestry in 2013. The measure improved relevant skills, as well as networking and capacity building. Nevertheless, the measure had a very limited impact, as only 17% of all the ex post evaluation reports found that the measure contributed positively to the improvement of economic diversification, and in most cases to a limited extent (36%). The methodological approach taken in the JRC study for the elaboration of a counterfactual impact evaluation study provides causal estimates of the CAP’s impact on a set of regional economic (GDP per capita, total gross value added (GVA) and employment) and agri-sector related economic outcomes (GVA in the agri-sector, employment in agriculture, land and employment productivity) . The analysis addresses the CAP’s performance at regional level and in particular the convergence of rural regions using the Generalised Propensity Score method. The JRC analysis is based on a NUTS3 level description of the regional dimension of the CAP in the period 2011-2018. This implies a characterisation of: (i) the rural regions, according to their economic aspects and in particular of their agri-sector and; (ii) of the regional CAP mixes (of Pillar 1 and Pillar 2 groups of measures) in time intervals characterised by the implementation of relevant CAP reforms. The JRC analysis of the CAP’s impact found that CAP support and particularly rural development support) are effective in stimulating the local economic performance (particularly in developed peripheral rural regions and traditional rural regions), with high relevance in bolstering gross value added and contributing to a significant total employment growth in predominantly rural areas, with effects increasing over time and no significant differences in the role of the various instruments. Without the CAP supporting the maintenance of farms in most remote areas, the labour outflow from rural areas towards urban areas would have been bigger. The study also concluded that “although rural development payments do not target specifically the agricultural sector, they aim to improve the quality of life in rural areas and create additional non-agricultural employment. By supporting other sectors such as construction or tourism, these payments may be effective in creating new rural jobs, which can lead to a loss or continuation of agricultural employment depending on whether they are substitutes or complements. By making farm households and rural areas more multifunctional, they help to stabilize regional incomes and employment”. 5.1.3.4.Rural development programme’s contribution to the creation of access to broadband internet For the vitality of rural areas, broadband access is key. Coverage of fixed broadband remained at 97% in 2015, and about 6% lower in rural areas. Next Generation Access technologies were available to only 53.7% of the EU-27 in 2012 and around 80% in 2017. In general, effective internet take-up lags behind broadband coverage. In 2012, 72.5% of all EU households had subscribed to a broadband connection. In the rural areas of the EU, this was only 64.3% of the households. These figures were slightly higher in 2017 (75% and 68% respectively). The gap between households having subscribed to broadband connection in rural areas and at national level was 10.3 pp in 2008, 8.2 pp in 2012 and 7 pp in 2017, showing that rural areas are nevertheless catching up. The main measure that contributed towards broadband access in rural areas was M321 (basic services for the economy and rural population). The quantitative data (provided in 19% of the reports only), shows that the rural development programmes created new or improved access to broadband internet in 1.4 million households or businesses (15% of the total rural population). The average number of households or businesses with new or improved internet access was 81 315 per region, with the lowest region having only 7 that benefitted from these changes. The qualitative data shows that the rural development programmes’ contribution to the creation of access to broadband internet was positive in 35% of all Member States/regions. These effects can be attributed mainly to regions that effectively activated the fibre optic infrastructure and enabled additional phone lines, thus laying the ground for subsequent access to internet by the residents. 15% of the reports, however, found that the rural development programmers had limited effects on improving access to broadband internet. This was primarily due to administrative problems with the implementation, which started late and therefore delayed concrete results. Finally, 37% of the reports established that the initiative did not apply to the specific Member State/region. 5.1.4.Axis 4. Building local capacity (LEADER) LEADER (Axis 4) is a horizontal axis thus affecting aspects of the other EAFRD axes. The evaluation support study concluded that the rural development programmes have contributed positively and to a medium extent to building local capacities for employment and diversification through LEADER. This conclusion also goes along the European Economic and Social Committee’s report, where LEADER was praised by all the interviewed stakeholders, as they found that it provided beneficial results for both the regions and the communities. Furthermore, it is also confirmed in the public consultation, with a majority positive recognition by all questioned stakeholder groups. The measures under this axis, especially M411 (Competitiveness), M412 (Environment), and M413 (Diversification) were often jointly programmed and evaluated in several Member States/regions. As a result, they are reported on as M41 (Implementation of local development strategies). Some measures of the other Axis (mainly of Axis 3) were also programmed under LEADER. The table on next page gives an overview of the main objectives under each LEADER measure.

M411 M412 M413 Implementation of local development strategies and a focus on : ·Competitiveness ·Environment and land management ·Quality of life and diversification M421 Implementation of co-operation projects, inter-territorial and transnational cooperation M431 Management of local action groups, skills development, support to the functioning of the Local Action Group for capacity development and promotion Source: DG Agriculture and Rural Development Member States spent a total of EUR 5.6 billion on LEADER measures, which were implemented as follows: ·Measure 411(competitiveness): 22 Member States; 66 regions; total EAFRD expenditure EUR 471.5 million. ·Measure 412: 16 Member States; 37 regions; EUR 58.9 million; ·Measure 413: 27 Member States; 88 regions; EUR 3.977 billion; ·Measure 421: 27 Member States; 74 regions; EUR 170.8 million; ·Measure 431: 27 Member States; 88 regions; EUR 897.7 million. Note: M411 corresponds to competitiveness; M412, environment/land management; M413, quality of life/diversification; M421, implementing cooperation projects; M431, running the local action group, skills acquisition, animation Source: DG Agriculture and Rural Development As regards the quantitative overview, the output indicators reported for Measures 411, 412, 413 (together referred to as M41), are aggregated. Overall, measure 41 resulted in a total of 2 417 Local Action Groups (LAGs) covering 4.1 million km2 and 143 million inhabitants and 18.5 million beneficiaries. In total 222 794 projects were financed by the local action groups, i.e. on average 92 by LAG. Measure 421 supported a total of 5 524 cooperation projects in which 7 432 LAGs cooperated with each other. 13 ex post evaluation reports provided information on the creation of in total of 4 784 jobs (gross value). Over a quarter (27%) of the evaluation reports found that measure 421 contributed to the LEADER approach to a great extent. 17% reported to a medium extent, 4% a limited contribution and 13% an unclear contribution. Measure 431(running the local action group, skills acquisition, animation) supported 349 061 action groups and 5 863 participants ended a training activity successfully under this measure. However, the output indicators have to be treated with caution as there are major issues regarding the land size and the population covered. E.g. according to the output indicators, the LAGs cover approximately 200% of the total rural area in Europe (not possible by definition) or 93% of the total land area. 5.1.4.1. LEADER’s contribution to building local capacities for employment and diversification About half of the Member States reported on the contribution of LEADER to job creation. The figures are small, however, the quantitative information is not sufficiently consistent to allow for a judgment. According to the ex post evaluation reports, 28 242 jobs were created through M411 (competitiveness) in the 15 Member States that reported this indicator, 6 505 through M412 (environment/land management) in 3 reporting Member States and 12 525 through M413 (quality of life/diversification) in 13 reporting Member States. Additionally, 149 534 participants ended a training successfully through M411 (competitiveness), 58 through M412 (environment/land management) and 11 998 through M413 (quality of life/diversification). According to the available qualitative information, measure 41 contributed to enhancing employment to a limited extent. 40% of the ex post evaluation reports found that M41 (M411, M412, M413 together) had a positive effect on employment. 15% reported a limited effect, 7% no contribution and 11% other effects. In addition for 27% no information was available. The contribution of M431 (running the local action group, skills acquisition, animation) to build local capacities for employment was considered positive in 19 out of 82 reports (23%). 12% reported a limited contribution and in 42 reports (51%) no data was available. This leads to the conclusion that the measure contributed to building local capacities for employment to a medium extent, with 65% of all judgments being positive.

Only 10% of the evaluation reports reported positive effects of M41 (M411, M412, M413) on diversification. 13% reported a limited effect, 6% no contribution and 1% other effects. While the contributions to employment can be considered plausible, the evidence presented in the Member States’ evaluations on diversification was weak and thus not plausible. 5.1.4.2. The Local Action Group’s contribution to achieving the objectives of the local development strategies and those of the rural development programmes The local development strategies are designed to reflect a multi-sectoral approach, where the priorities cover the needs and expectations of the stakeholders of the regions. The contributions of M41 (aggregated M411, M412 and M413) to achieve the objectives of the total rural development programmer was deemed positive in 34% of the evaluation reports and with limited effect in 17% of the reports. LEADER contributed to the three main axes of the rural development programmer and to the crosscutting objectives of the EAFRD. LAGs played an important role in preparing and implementing the local development strategies. The contribution of LEADER to achieve the objectives of the local strategies was considered positive in 36% of the reports. A number of reports stated a limited contribution (17%). However, as in a substantial number of reports no data was available (35%), the overall contribution is judged to be small. The qualitative overview indicates that the LAGs have contributed to achieving the objectives of the local strategy and the rural development programmes to a medium extent, yet, due to the limited share of reports that provided conclusions, this qualitative assessment of the contribution has to be taken as indicative only. 5.1.4.2. LEADER’s contribution to improving local governance EUR 897.7 million was spent on M431 (running the local action group, skills acquisition, animation) by 27 Member States across 88 regions, which resulted in 5 863 participants that successfully ended a training activity and a total of 349 061 actions supported. Unfortunately, it is not clear what kind of actions or projects were supported. The contribution of M431 to local governance was considered “high” (30%) to “medium” (21%), although many data was missing in several evaluation reports (28%). One of the clearest effects of LEADER was the implementation of public/private partnerships, enabling stakeholders’ long-term involvement in the development of a local strategy. In general, this effect was hard to quantify given the lack of indicators to characterise local governance. The qualitative overview indicates that the implementation of the LEADER approach contributed to improving local governance to a medium extent, however this assessment is based on a low level of input from Member States evaluations. Conclusion The overall assessment of LEADER cannot be considered plausible due to the small share of reports that provided conclusions (with the exception of the contribution to enhancing the employment situation). A general issue is that quantifiable indicators were not able to capture the specific characteristics and objectives of the LEADER approach, e.g. improving local governance or increasing local participation. The aspects that were quantified are not highly relevant for LEADER (e.g. job effects). As Axis 4 is horizontal, it affects aspects of the other EAFRD axes and some measures under other axes, especially Axis 3, were programmed under LEADER. At times it was not clear whether such measures were reported on under Axis 3 or 4 in the evaluation reports. The synthesis approach did not sufficiently allow for consistently dealing with this aspect, amongst other specifics of LEADER. Furthermore, consistency was weakened by evaluators using different approaches in answering the evaluation questions. 5.2.Efficiency 5.2.1.Qualitative assessment The majority of ex post evaluation reports do not provide a judgment on efficiency of resource allocation at programmer level: 37% do not provide information or judgments at all and 23% only provide a judgment at measure, axes or objectives level. Out of all the reports that provide a judgment, 45% judge the resource allocation in relation to achieved outputs as “efficient”, while 13% report low levels of efficiency (inefficient), and 5% suggest no efficient allocation at all. Yet, only about half of the ex post evaluation reports (52%) provide a definition of the term efficiency and only 33% provide a definition that is clearly in line with the definition used in the Better Regulation Guidelines. The public consultation assessment of efficiency is close to the one in rural development reports. Overall, 44% of the respondents thought that the rural development programmes were good or very good value for money, 31% thought they had limited value for money and 10% no value for money, with no major difference between stakeholders. The difficulties to demonstrate the efficiency of the 2007-2013 Rural Development Policy were also amply highlighted in the Court of Auditors special report 12/2013. The Court observed that the rural development programmes did not sufficiently set specific objectives with targets for the results and that the indicators were not sufficiently reliable. The European Court of Auditors also pointed to certain issues of efficiency. For instance, in the Special Report No 20 of 2015 they pointed out in relation to non-productive investments (measure 216) that “overall, the support has contributed to the achievement of objectives linked to the sustainable use of agricultural land, but in a way it was not cost-effective”. Similarly, in their Special Report No 12 of 2015, related to the measures promoting a knowledge-based rural economy (measures 111, 114, 115 and 331) the Court found weaknesses related to cost-effectiveness. They also concluded that there was considerable scope for making real savings in Rural Development project grants in the 2014–2020 programming period by better approaches to controlling the costs. (Special report No 22 of 2014). The European Economic and Social Committee (EESC) concluded in their report that there is a strong need for further simplification and less bureaucracy both at EU and Member State level, as well as at the regional and local level, when it comes to all procedures, from application through implementation to final reporting. It stated that procedures were too complex and that this discouraged potential beneficiaries. The Committee also pointed to the strong criticism expressed by stakeholders to the long time needed to get the programme running.

Given the lack of robust evidence mentioned above, it is very hard to derive an overall conclusion on the proportionality of Rural Development expenditure with regard to the benefits achieved at EU level. It is clear however that there are wide variations in efficiency between programmes and between measures. Member States evaluations pointed to several factors limiting efficiency: ·The regulatory framework: the evaluations pointed to an, in general, “inappropriate regulatory framework and application of the law”. Fundamental design errors of the legal framework, individual regulations and very rigid legal interpretations in terms of error prevention were more pronounced. The changes resulting from the ‘health check’ reform (increasing demands on documentation, data and reporting and a growing number of controls and supervisory authorities), were also seen as limiting the efficiency. ·Design of programmes and measures: One report stated that 'standard measures', which are already offered over various funding periods with relatively large financial volumes and are more efficient due to the administrative routine and greater acceptance by beneficiaries than newer measures, which often also have lower financial budgets. ·Programme implementation: lack of staff and its insufficient availability, leading e.g. to long waiting time for beneficiaries, or the delays in starting the programmes are often mentioned. Another issue raised is the “lack of innovative actions”. For Axis 2 (environment and the countryside), evaluators suggest “increased actions for environmental development” and “improved knowledge structures, indicators, research, development work to strengthen the instruments that capture variables for environmentally friendly farming”. Improvement for axes 3 (improving the quality of life in rural areas) and 4 (Leader) could be the reduction of administrative burden, the development of qualitative indicators to highlight networks, social trust and belief in the future; better definition of objectives with regards to community led development. ·Low uptake of measures, low expenditure rates: this issue was found in several reports. The reductio