The Agriculture Committee of the European Parliament has reached an agreement with the EU Finance Ministers on the distribution of billion-euro subsidies from the corona mega-recovery fund for the agricultural sector and the food industry.
On Tuesday, the Parliament and the Council reached a provisional agreement on an EU recovery package for farmers, food producers, and rural areas to enhance their resilience. The political agreement now reached still needs to be formally ratified by both the full European Parliament and by the ministers and heads of state.
These discussions in Brussels about the corona recovery fund are separate from the talks on a new Common Agricultural Policy, but form part of the negotiations on the multiannual financial framework 2021-2027. The European Parliament, heads of state, and European Commission had also disagreed on this for months, but precisely on Tuesday a first compromise was also reported there.
All corona recovery subsidies in the agricultural sector must be paid out in 2021 and 2022, and not in 2022-2024. Moreover, more than a third must be allocated for environmental and climate-related actions, and more than half of the support must go to young farmers.
The negotiators agreed to bring forward all amounts available for rural communities from the EU recovery instrument to 2021 and 2022. The European Commission had proposed to release the funding between 2022 and 2024. Approximately 30% of the €8.07 billion in corona recovery aid will be made available in 2021, and the remaining 70% will be released in 2022, according to the agreed text.
Members of the European Parliament succeeded in earmarking at least 37% of the subsidies for organic farmers, environmental and climate-related actions, and animal welfare. At least 55% of the fund will support young farmers in starting businesses and farm investments that contribute to a resilient, sustainable, and digital recovery.
The negotiators agreed that investments by farmers and food processors that contribute to a sustainable and digital economic recovery can be supported up to 75% of the costs incurred.
Members of the European Parliament also succeeded in raising the ceiling for startup support for young farmers from the Rural Development Fund from €70,000 to €100,000.
“We have managed in a very short time to agree that the much-needed financial support for EU farmers, food producers, and beneficiaries in rural areas will be released quickly. Now we must rapidly conclude the negotiations on the CAP rules for 2021 and 2022, so that by the end of the year we have approved relevant rules to help farmers be more resilient in the future,” said Norbert Lins, chair of the Agriculture Committee. (EPP, DE).