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PAC in the future: less financial resources and burocracy

European commission published the financial framework for the period 2014-2020. The focusing point is the “Strategia Europa 2020” (European Strategy 2020) that include a gross budget of 1.025 Billion of Euros, equal to 1,05% of Gross Domestic product (GDP).

Decreasing resources. Financial resources planned to be destined for agriculture are almost 400,00 Billion of Euros, around 36% of the total amount, showing a sensible decrease compared to the period 2007-2013. The total amount is composed as follow: 281,8 Billion € are destined to CAP (direct payments), 89,9 Billion € to rural development, 4,5 Bln € in innovation and research, 2,2 Bln € in food safety, 3,5 Bln € in emergencies, 2,5 Bln € for charity, 2,5 Bln € as globalization fund and around 6,6 Bln € to sustain fishing.

First pillar.  PAC will keep on providing direct financial support to farmers but European commission is analyzing a new system to equally distribute these resources aiming to reduce differences between member states. Will be promoted a more balanced distribution of quotes to raise up the minimum level of countries under the UE average threshold. Italy at the moment is slightly above the average threshold, so Italy will be one of the nations that will actively contribute to rebalance this disparity reducing its incoming economic support from the actual 4,13 Bln € to the future 3,84 Bln €. The base payment will be determined by quotes resulting from the total amount available and the area declared. Upon national taxation and estimating an area equal to the total agricultural area, the base amount of payment will be between 140 and 210 €/ha.

Active farmer. One of the strengths of this reform is the individuation of active farmers, with this reform European Commission will try to cut off from financial support all companies with marginal or inexistent activity. This individuation seeks to exclude all companies with:turnover less than 5%, companies with area usable for pasture, companies with no activity on their land.
Companies who benefited for amounts less than € 5,000 are however exempted from the non-applicability of the reform.

Small companies and ecology.  A substantial amount of financial resources will be destined for sustainable and ecologically correct practices. European commission also proposed to introduce a simplified process for the assignment of financial sustains to small companies in order to reduce administrative costs and bureaucracy for the member states and farmers.This financial reform after 2013 aim to strengthen the competitiveness and the sustainability of agriculture and maintain its presence in all regions, in order to guarantee European citizens healthy and quality food production, to preserve the environment and to help develop rural areas.

Second pillar. Three are the main aspects that will lead the future rural development: Climate and Environment, Biodiversity, innovation and environment.
European commission will keep on providing public services, to improve competitiveness in the agriculture sector and to promote diversification of economic activities and to improve quality of life in rural areas. Member states will be allowed to be more flexible on decisions regarding their local needs.

Conditioned programs. With the term “Multiprogram funds” European commission intend allocate different type of funds to encourage common processes for training, managing and execution of human resources and infrastructural investments. Since 1990 reforms of CAP started to reduce sustain on prices, and rural development has been made by financial resources generated by a deeper partition of the total amount. Conditions for these funds will be on two different type: Ex ante (they must be released before the results) Ex post (they’ll be released only after results obtained).

Presentation of the new agricultural policy that will come into effect next January.