NON-PAPER ON CAP SIMPLIFICATION 37th Conference of Directors of EU Paying Agencies: 7 May 2015: Riga Report from the

CONTEXT FOR NON-PAPER Commission initiative to simplify the CAP European Parliament COMAGRI Agriculture Council/Presidency DG AGRI Simplification Experts’ Group Conference of Paying Agency Directors

Commissioner Hogan’s speech of 3 December 2014 to EP COMAGRI The implementation of the new CAP offers a good opportunity to maximize the contribution to growth and jobs agenda. Simplification is a top priority for my work programme in ‘Red tape’ entails direct costs for farmers and operators, and can interfere with their business decisions. Simpler rules will make for greater competitiveness and will enhance the job-creating potential of agriculture, of rural areas and of agricultural trade. This is why I have committed to deliver within a year of my mandate. We need to simplify our rules now and cut red tape in an effective way.

Commissioner Hogan’s speech of 3 December 2014 to EP COMAGRI Simplification actions should concentrate on those elements which can be changed within the current policy framework. All the institutions need to participate in this exercise. Comprehensive screening exercise of the entire agricultural policy to identify which areas and elements can be simplified and which, in line with the subsidiarity principle, should be better left to Member States. Review, after the first year of application, the rules on Ecological Focus Areas. Simplify other rules of the new direct payments regime within basic policy decisions of 2013 reform.

Commissioner Hogan’s speech of 3 December 2014 to EP COMAGRI Commissioner has urged MEPs to consolidate their main concerns on CAP simplification in an own-initiative report later this year Individual MEPs have made proposals for CAP simplification. COMAGRI hearing on CAP simplification on 4 May 2015 to assess what changes are required to make the existing rules more user-friendly: perspectives of farmers and paying agencies

In the Council First discussion on simplification was held during Agriculture Council on December Commissioner wrote to Member States on 14 January 2015 inviting ideas and proposals for simplification. Ministers held a policy debate on CAP simplification during the Agriculture Council on 16 March The most important issues highlighted were the 'greening' measures and controls. Also noted were requirements for producer organisations in the fruit and vegetable sector, reporting requirements and, for rural development, the programming, approval and state aid procedures.

In the Council CAP simplification is also currently being discussed in the Council's working parties and at the Special Committee on Agriculture. The outcome of the March policy debate and the discussions in the Council's preparatory bodies will help prepare the ground for the adoption of Council conclusions on the issue on Monday (11 May 2015).

In the Council The focus should be on the potential for simplifying the delegated and implementing acts. However, Member States are likely to also make some points on the basic CAP legislation. Towards the end of 2015, the Commission is expected to make a presentation at the Council on its detailed simplification agenda and its follow up to the Council conclusions (currently scheduled for November 2015).

DG AGRI Simplification Experts Group Experts’ Group held 5 and 6 February 2015 Simplification of the CAP Marketing Standards UK presentation on implementation of EFA DK presentation on implementation of the new penalty rules for Rural Development non-IACS measures Learning Network non-paper on simplification of the new CAP

LEARNING NETWORK Learning Network prepared a non-paper on CAP simplification from the perspective of the Paying Agencies. Draft prepared December 2014/January 2015 and discussed at Learning Network plenary meeting on 19 January Proposals split between short-term ( ), medium- term ( ) and long-term (post 2020) Non-paper submitted to DG AGRI on 2 February 2015

LEARNING NETWORK Learning Network plenary meeting on 15 April 2015 reviewed simplification proposals and identified further opportunities for immediate, non-legislative changes to guidelines. Meeting of Learning Network Steering Group with DG AGRI on 20 April 2015 to discuss CAP simplification proposals. Discussion focussed on top 5 priorities from non-paper of 2 February 2015 and short-term changes to guidelines. These issues were included in an appendix to the original non-paper and submitted to DG AGRI on 24 April 2015.

SIMPLIFICATION PRINCIPLES Reduce implementation costs and rates of on-the-spot checks Risk-based approach More proportionate control and penalties in relation to the measures involved, including greater tolerances Streamlining of regulations, roles and responsibilities, especially in relations to audits.

SIMPLIFICATION PRINCIPLES Subsidiarity: greater flexibility in details of implementation and controls to reach the most effective administrative procedures, best fitted to local situations and law; with no higher risks to the EU funds. Monitor and review the implementation of the greening requirements as soon as possible In the meantime a flexible approach in auditing the first year(s) of the implementation of direct payments Greening control procedures should not obstruct a timely payment to the beneficiaries.

TOP 5 PRIORITIES (1) It is not possible to make payments to any farmers before all controls are finalized. The new CAP legislation requires extra controls, which might lead to later payments to the farmers, as they all have to be finished. Therefore, show more flexibility in relation to requirements for BPS and greening payments, use a more risk-based approach, reduce the number of controls, simplify the use of control samples and use one sample for all area-based controls (including RDP), allow payments to farmers not selected for any follow-up controls by making a interpretation in line with the 2009 interpretation of when a control is finalized.

TOP 5 PRIORITIES (2) Paying Agencies could make unintended mistakes as the result of the complexity of the new CAP. Give paying agencies more scope and time to detect and repair unintended mistakes and show more tolerance in relation to possible sanctions and financial corrections.

TOP 5 PRIORITIES (3 & 4) Delete/simplify the requirement for the use of mixtures for catch crops. Delete the requirement to register landscape features not subject to greening payments. Also skip the requirement that the EFA-layer should include non- stable elements like fallow land.

TOP 5 PRIORITIES (5) The implementing rules where each greening requirement must be controlled at a minimum rate of 5 % makes it impossible to carry out only one control visit to the farmer. This also increases the risk for timely payments to farmers. Give paying agencies the option to perform OTSC of all greening requirement during the same inspection (similar to the inspections of cross compliance).

NON-LEGISLATIVE/GUIDELINE SIMPLIFICATION PROPOSALS Horizontal issues (7 proposals) Greening (12 proposals) Rural Development (4 proposals) Single CMO (5 proposals)

HORIZONTAL ISSUES – EXAMPLES Member States should be able to make a payment once all eligibility checks for that application have been finalized. Payment should not have to be held up because some inspections on other applications have not yet been completed. Exclude from X-table following fields: F502, F503, F508A, F508B, F509A, F600, F601, F602, F603. The reports sent to the European Commission are complex, time consuming and voluminous. In addition the reported data overlaps which creates administrative burden.

GREENING – EXAMPLES When a farmer is selected for an on-the-spot check all greening aspects must be checked. This provision may lead to the farmer involved having to be checked twice as some greening aspects can only be established later in the season. This is undesirable both for the farmer and for the inspection body. An inspection regime that checks all aspects at one moment will be sufficient for most greening measures. Farmers and Member States should not have to map potential EFA features where farmers are not using them as part of their EFA claim.

RURAL DEVELOPMENT - EXAMPLES In cases where the simplified cost approach could not be used and the aid application concerns a significant number of invoices, it should be possible to limit the check to a selection of invoices at the administrative controls. It should be possible to use samples for the administrative checks made on land management expenditure. Verification of every eligibility criteria, commitment and obligation by administrative checks may not be practical.

SINGLE CMO - EXAMPLES In the case of various PO recognition criteria it is not clear or insufficiently clear as to what exactly is required of POs and how POs may sufficiently demonstrate compliance with the requirements. Words like “sufficient”, “serious”, “justified” should be replaced with objective criteria. Develop guidelines for eligible and non-eligible costs under operational programs. Harmonize the control period and reporting period for the School Fruit Scheme.

Thank you for your attention Let’s simplify the CAP! 37th Conference of Directors of EU Paying Agencies: 7 May 2015: Riga Report from the