1. The NFU champions British farming and provides professional representation and services to its farmer and grower members Common Agricultural Policy Reform and its implications for the Cotswolds Andrew Clark Head of Policy, NFU

2. The NFU champions British farming and provides professional representation and services to its farmer and grower members Complex political context Uncertainty over EU Budget Lisbon co-decision process –Commission –European Parliament –Council of Ministers Timetable involving 5 Presidencies with aim of agreement January 2014 Member States are in very different situations

3. The NFU champions British farming and provides professional representation and services to its farmer and grower members co-decision

4. The NFU champions British farming and provides professional representation and services to its farmer and grower members Historic SAPS Hybrid Flat rate Move to a flat rate system within MS or Region

5. The NFU champions British farming and provides professional representation and services to its farmer and grower members 5 Average direct payments per potentially eligible area Direct payments net ceilings fully phased-in (in 2016) Source: European Commission - DG Agriculture and Rural Development

6. The NFU champions British farming and provides professional representation and services to its farmer and grower members Pillar 2 allocations

7. The NFU champions British farming and provides professional representation and services to its farmer and grower members New System of Direct Payments A modest re-distribution of funding between member states Limited flexibility for member states to move funding between pillar 1 and pillar 2 Direct payments to be capped, targeted at active farmers and more heavily conditioned (aka greening) Changes to cross-compliance Additional assistance for young farmers Optional payment in areas of natural constraint and for re-coupled support

8. The NFU champions British farming and provides professional representation and services to its farmer and grower members Pillar 1 – Direct payments National ceiling 100% Basic Payment Scheme compulsory (residual) (58% to 43%) Greening payment (30%) compulsory Natural constraints (up to 5%) voluntary Coupled payments (up to 5-10%+) voluntary Young farmers (up to 2%) compulsory Small farmers scheme - compulsory (maximum 10%)

9. The NFU champions British farming and provides professional representation and services to its farmer and grower members An additional payment for green agricultural practices Farmers entitled to a payment under the basic payment shall observe all of the following agricultural practices: –Crop diversification –Maintenance of Permanent grassland –Ecological focus area

10. The NFU champions British farming and provides professional representation and services to its farmer and grower members Crop diversification Where the arable land, claimed by the farmer, covers more than 3ha, and is not entirely used for grass production, cultivation on the arable land shall consist of at least three different crops. None of those crops shall cover less than 5% and the main one shall not exceed more than 70% of the arable land (arable land includes permanent crops) Definitions of crops shall be defined by Commission at a later stage.

11. The NFU champions British farming and provides professional representation and services to its farmer and grower members Permanent grassland Farmers shall maintain as permanent grassland the areas of their holdings declared as such in their 2014 claim, this it to be known as reference areas under permanent grassland. Farmers will be allowed to convert 5% of the reference areas "permanent grassland" means land used to grow grasses or other herbaceous forage naturally (self- seeded) or through cultivation (sown) and that is not included in the crop rotation of the holding for 5 years or longer

12. The NFU champions British farming and provides professional representation and services to its farmer and grower members Ecological focus area Farmers shall devote at least 7% of their eligible area, excluding areas used for permanent grassland, for ecological purposes The ecological areas may include for example; fallow land, landscape features, buffer strips, woodland supported by agri-env. The Commission will decide which other features count at a later stage

13. The NFU champions British farming and provides professional representation and services to its farmer and grower members Derogations Farmers whose holding is partially or wholly within Natura2K (i.e. SSSI) will have to do the actions: unless they are not compatible with aims of protected site Farmers holdings that are organic shall automatically be entitled to the additional aid through a derogation.

14. The NFU champions British farming and provides professional representation and services to its farmer and grower members Optional Payment for Areas with Natural Constraint Member States may grant an additional payment to farmers whose holding is fully or partially situated in areas of natural constraint ANC (i.e. new LFA) Up to 5% of national / regional ceiling Paid as a top up to the Basic Payment Entitlements

15. The NFU champions British farming and provides professional representation and services to its farmer and grower members Potential impact to agri-environment delivery Uncertainty impacting on-farm decisions Will greening deliver significant change? Optional areas of natural constraint payments Changes to cross compliance –WFD and SUD requirements introduced at pace of slowest EU Budget and Treasury match funding

16. The NFU champions British farming and provides professional representation and services to its farmer and grower members Implications for the Cotswolds Greening measures may penalise those already in Environmental Stewardship, as payments payment rates reduce Budget for agri-environment activity likely to reduce Permanent pasture condition sending perverse signal

17. The NFU champions British farming and provides professional representation and services to its farmer and grower members Role for Conservation Board Understand the CAP reform and impact on the Cotswolds special character Ensure this character is reflected in schemes and local advice Support transfer of Cotswold ESA and CSS agreements to Environmental Stewardship Active participant in Campaign for the Farmed Environment and Environmental Stewardship programmes.

18. The NFU champions British farming and provides professional representation and services to its farmer and grower members THANK YOU