The main goal of the new subsidy, with a total budget of €1.47 billion, is "to reduce nitrogen deposition on natural areas."
The proposed schemes will effectively reduce the livestock population in the Netherlands, as every farmer participating must agree that their decision to stop farming is "final and irreversible." They must also agree not to start a similar breeding program elsewhere in the Netherlands or in the European Union (EU) with their compensation payout.
The European Commission has assessed the proposed schemes against EU state aid rules and competition distortion criteria. These criteria allow support for the full or partial closure of "production capacity for environmental reasons," it is stated.
The schemes are limited to small and medium-sized livestock farms in the Netherlands that consent if their "nitrogen deposition burden" exceeds certain minimum thresholds. Farmers who pollute little or not at all are therefore not eligible.
The Dutch government had already reserved a nitrogen fund of tens of billions of euros last year to improve Dutch nature by reducing nitrogen deposition. Judicial rulings from 2019 have forced the Dutch government to make greater efforts to comply with EU nature conservation rules. The EU considers that there are far too many livestock animals in the Netherlands.
EU Commissioner Margrethe Vestager (Competition) said: “The Dutch schemes of €1.47 billion that we approved facilitate the voluntary closure of farms with significant nitrogen deposition on natural areas.”
Farmers participating in the LBV scheme worth €500 million will immediately be compensated 100% for losses they suffer by closing their dairy, pig, and poultry farms, including losses from production capacity and production rights.
Meanwhile, the LBV-plus scheme of €975 million is only open to the highest polluters, the "peak emission breeding sites" that emit high nitrogen levels.
In recent years, Dutch farmers have demonstrated extensively against the "forced" reduction of livestock and other Green Deal climate regulations. Recently, in regional elections, a pro-farmer party was the big winner.