DISCUSSION NOTE FOR WATER DIRECTORS – MAY 2011

Prepared by EC.DG ENV.D1

Item 3. Strategic Policy and Integration Issues

a) Reform of the Common Agriculture Policy

The Water Directors are invited to discuss the following question:

Do the Water Directors see any technical obstacles to the inclusion of the WFD into cross compliance?

Do the Water Directors see the green component considered in the Communication on CAP reform as an opportunity for water protection?

Do the Water Directors see a standard on buffer strip width as a workable option?

1. Inclusion of the Water Framework Directive within the scope of cross compliance

The Commission Communication COM(2010) 672 on CAP reform states that “the inclusion of the Water Framework Directive within the scope of cross compliance will be considered once the Directive has been implemented and the operational obligations for farmers have been identified”.

Different criteria to be considered

The relevance of adding the WFD to cross compliance can be assessed towards the following criteria:

- The provisions must be relevant and with high priority relative to the objectives of cross compliance.

- The provisions must have a direct link with the agricultural activity and/or the agricultural land.

- The provisions must only relate to actions or omissions directly attributable to individual farmers.

- The provisions must be controllable at reasonable costs and quantifiable (or at least allowing to define reduction rates).

- The provisions must not create undue discrepancies between concerned farmers, beyond what is required to take into account local needs.

Is the WFD relevant and does it have high priority relative to the objectives of cross compliance?

Cross compliance has the dual aims of contributing to making the CAP more compatible with the expectations of consumers and taxpayers and to making farming more sustainable.

Water protection is identified as a major concern for the European citizens. Water pollution always ranks on top of EU citizens environmental concerns, second only after climate change in the last Special Eurobarometer on Environment of March 2008. Two thirds of European citizens believe that water problems, both in quantity and quality, are serious or very serious in their countries, and two thirds think that the impact of agriculture on the water environment is large (Flash Eurobarometer on water, March 2009).

Moreover in the WFD implementation process, pressures by agriculture have been identified as very high. For instance, in the public consultation process, pressures by agriculture have been identified as the first significant water management issue (SWMI). More recently, a review of the draft River Basin Management Plans (dRBMP)[1], which were ready in September 2009, showed incontrovertible evidence that the agricultural sector generates a significant pressure on both surface waters and ground waters in terms of quality and quantity. Results show that diffuse or point source pollution by nitrogen is reported in 91% of the dRBMPs, phosphorus in 90% of the cases and pesticides in 69% of the dRBMPs. Hydro-morphological pressures are reported in about 50% of the dRBMPs. Furthermore, irrigation presents a pressure to water quantity found in about 37% of the dRBMPs (this survey did not include most of Southern European countries and therefore the real percentage is larger). In addition, the first results from the assessment of final River Basin Management are very similar to these figures. Moreover, according to a recent assessment by the EEA, agriculture represents the second water abstracting sector in Europe with an annual share of 24%. This figure can be up to 80% in southern countries.

Water protection being identified as a priority for the European citizens, agriculture exerting a high pressure on the water resource (challenging its own sustainability at the same time), WFD being the main European piece of legislation on water, it seems natural that WFD should be included into cross compliance.

Do WFD provisions have a direct link with the agricultural activity?

ManyWFD provisions have a direct link with the agricultural activity as they regulate how and how much water is used, the conditions to discharge used water, the activities that may give rise to diffuse pollution and the hydromorphological aspects such as the conservation of the riparian areas. Agricultural activity has a direct impact on water quality and/or quantity, for example:

- In irrigated agriculture, water is abstracted from surface or groundwater. In large parts of the EU agriculture is the largest consumer of water and it poses a very important pressure on resources. Overexploitation of water resources by agriculture is one of the most important problems in a significant number of river basins in the EU.

- The use of fertilizers and pesticides in agriculture is one of the main sources of pollution in the EU. Farms can be the origin of important point source discharges of waste water, in particular those coming from agriculture activities linked to livestock breeding.

- Agriculture activity puts pressure on the morphological conditions of the water courses through alterations to the riparian area, straightening of water courses, etc.

The WFD contains provisions that affect all these aspects and therefore are relevant to the agricultural activity and to cross compliance. The annex 1 gives more details..

Do the WFD provisions relate to actions and omissions directly attributable to individual farmers?

As a general rule, provisions relate to the way water is abstracted and discharged or to activities that are part of the farming practice that have a direct impact on the quality, quantity or physical condition of the aquatic environment. Therefore, failures to follow the rules are directly attributable to farmers.

Examples are:

- Abstraction of water for irrigation without a permit (WFD article 11.3.e)

- Discharging waste water directly to water courses or indirectly using percolation through soil without a permit (WFD Article 11.3.g and j)

- Application of pesticides not in accordance with the rules (time of application, type of pesticide, application close to water courses, etc) (WFD article 11.3.h)

- Modifying a riparian area of a water body without authorisation (WFD article 11.3.i)

Are the WFD provisions controllable at reasonable costs and quantifiable?

The relevant activities such as controls over abstraction of water, waste water discharges, physical modifications to water bodies, application of fertilizers and pesticides, are all controllable at reasonable costs. This is in fact what is happening already now in all Member States, as management, control, inspection and sanction systems are already in place in all of them.

Water policy is not new in the EU. There is a long tradition of water management all across Europe. Water administrations are developed entities that have long history and solid establishment. This fact is reflected ina well developed system of water management on which the WFD builds. The controls over the administrative regime to use water, discharge waste water or modify water bodies are in place in the Member States. The WFD provides for harmonisation of requirements and its legal implementation in most cases has already been done in the period 2003-2009 in the context of the transposition of the WFD, either by law and/or regulations.

As highlighted in annex 2, Member-States have management, control, inspection and sanction systems in place and working, independently from the cross compliance system. The transposition of WFD article 23 on sanctions into national law has been done in all Member States.

In addition to this, all Member States have established monitoring programmes to control the status of surface and groundwater. The programmes were due in December 2006 (WFD article 8). This provides a comprehensive mechanism to control the achievement of the objectives of the Directive.

Moreover,the regulation on cross compliance[2]states that "the competent control authority shall, with regard to the requirements or standards for which it is responsible, carry out checks on at least 1 % of all farmers submitting aid applications (...). Where the legislation applicable to the act and standards already fix minimum control rates, that rate shall insofar be applied instead of the minimum rate mentioned in the first subparagraph".

This means that the 1% on the spot default control for cross compliance does not apply if a minimum control rate for the WFD is in place otherwise.

Given the state of development of the inspection and control system in the Member States for the implementation of the WFD, cross compliance can make full use of the existing control and inspection mechanisms without implying any additional cost.

Does the WFD create undue discrepancies between concerned farmers, beyond what is required to take into account local needs?

Environmental policies like the WFD set environmental objectives which are common across the EU. The environment, just like the farming conditions, however, is very diverse, as well as the characteristics and intensity of the activities that put pressure on it. As a consequence, measures taken in some places may need to be more intense than in others, to take into account different local situations. The distance to target is different, as it is the sensitivity of the local environment to certain pressures.

In this respect, the WFD works on following principles:

- it establishes common objectives (to achieve good status in all water bodies),

- builds on existing legislation (notably the nitrates directive, the urban waste water and the IPPC) and includes a range of compulsory measures that need to be implemented in all cases as a baseline (the basic measures)

- leaves the definition of additional measures that are needed to achieve the objectives (the supplementary measures)to Member States.

Therefore, there is a strong baseline that has to be complied with in all cases, and the flexibility to define additional measures that are needed to take into account local circumstances.

Timeline of the WFD implementation in relation to the CAP reform

All the RBMP will be in place before the CAP reform

The RBMPs and the PoMs were due in December 2009. The Member States have 3 years (till 2012) to make operational the PoMs in order to achieve, as a default, the environmental objectives in 2015. Also in 2015, Member States have to update the RBMPs and PoMs. The measures that will be proposed in 2015 will need to be implemented at the latest by 2018.

To date (May 2011), 20 Member States have adopted their plans (AT, BG, CZ, DE, EE, FI, FR, HU, IE, IT, LT, LU, LV, MT, NL, PL, RO, SE, SK and UK). The currently adopted plans already cover more than 80% of the EU territory and population. Three other Member States have finalised the plans and are expected to adopt them in the coming weeks (CY, DK and SL). The remaining four Member States (BE-Wallonia, EL, ES and PT) are facing more significant delays. However, they are all expected to complete their plans by 2012.

The reformed CAP will be implemented from 2014 onwards. Implementing rules are expected to be developed in 2013, once the WFD measures have been made operational. This provides a unique opportunity to establish a coherent and strong link between the implementation of the WFD and the cross compliance system.

Many important mandatory WFD measures relevant for farmers are already in place

As explained above, the WFD builds on well established water management systems in the Member States, which have been developed as national policies and promoted also by European water legislation since the '70ies . In the context of the transposition of the WFD into national legislation, that was due in 2003, Member States implemented administrative provisions that cover many of the obligations under "basic measures" (WFD Article 11.3). Indeed, building on the existing regimes and modifying or extending them to accommodate for the new WFD obligations, the Member States have enshrined in their legislation (in most cases through basic laws in 2003 and/or implementing acts along the period 2003-2009), administrative regimes that cover issues such as the abstraction of water, the discharge of waste water, the control on diffuse pollution or the physical modification of water bodies. All of them have such regimes in place and are controlling them.

Obligations at farm level, resulting from other measures than the ones just mentioned, will be specified by the end of 2012 at the latest

As a strategic programme, the Programme of Measures specified in the river basin management plans does not necessarily contain all details of what needs to be done. The same happens with the other directives (e.g. Habitats Directive) or GAECs (e.g. minimum soil cover). In order to ensure a proper implementation of the obligations, the Member States have to make operational the general provisions in the EU legislation. Article 11.7 includes an explicit obligation with a concrete deadline to achieve that.

This means that the WFD foresees a period of 3 years (2009-2012) for the Member States to define in detail and to take the necessary actions to make the programme of measures operational. In case of measures related to agriculture for instance, they need to be detailed so that they can be put in practice at farm level by December 2012. The modalities of implementation of this obligation are left to the Member States, but may involve detail planning documents, rules or regulations.

These elements can be used for cross compliance.

2. The green component as a new tool for water protection

The Commission Communication COM(2010) 672 on CAP reform states that “the future of direct payments to be granted to active farmers could be based on the following principles (…):

– Enhancement of environmental performance of the CAP through a mandatory “greening” component of direct payments by supporting environmental measures applicable across the whole of the EU territory. Priority should be given to actions addressing both climate and environment policy goals. These could take the form of simple, generalised, non-contractual and annual environmental actions that go beyond cross-compliance and are linked to agriculture (e.g. permanent pasture, green cover, crop rotation and ecological set-aside). In addition, the possibility of including the requirements of current NATURA 2000 areas and enhancing certain elements of GAEC standards should be analysed.”

Risks concerning the compulsory and uniform nature of measures for farmers

By definition, not all of the 1st pillar criteria can apply to all farms: for instance, there is clearly no point in trying to apply obligatory permanent grassland on a farm which is 100% arable. Therefore, different criteria will apply in different locations.However, one discussed option is that the ‘green’ 1st pillar criteria could constitute a sort of‘menu’ from which farmers could choose a minimum required number.

Beyond the issue of conflict with the cross-compliance (see below),this 'menu' approach may notdeliver environmental gains. There may be indeed a pressure to minimise the demands of the 1st pillar criteria and there is a risk that some farmers would exclude certain, sometimes most efficient, measures from areas where they see them to be too demanding (for example by excluding the requirement for crop rotations from areas of monoculture or by excluding the requirement for ecological set-aside from intensive arable areas).

Budget allocated to the ‘green’ elements

The issue of how much of the 1st pillar money is allocated to each criteria is crucial to its impacts. The 1st pillar environmental criteria should ultimately take up a significant percentage of the 1st pillar budget. If this would not be the case it would be difficult to talk about a substantial link between the 1st pillar and the delivery of environmental public goods.

The payments levels for the ‘green’ 1st pillar component must take into account the delivery of public goods

The provision of public goods should be taken into account in establishing the relative payment rates for different 1st pillar ‘green’ criteria. For instance, to avoid a situation where arable farms received more 1st pillar ‘green’ funding than grassland farms – which is quite hard to justify from a public goods viewpoint - it might be necessary that the payment for permanent grassland isset at a higher level than the payment for green cover or crop rotations.

Articulation between 1st Pillar ‘green’ elements and cross compliance

It will be important to ensure that the articulation between the 1st Pillar ‘green’ elements and cross compliance, including GAEC, is implemented with care.

A number of issues arise, for instance :

- the articulation of the green cover measure with the Nitrates Directive,

- the articulation of the permanent pasture measure with the existing obligation on Member-State to maintain permanent pasture,

- the articulation between the crop rotation criterion and the GAEC which sets a standard for crop rotation,

- all water related GAEC and cross-compliance (groundwater directive) in relation to WFD.

Technical measures

The technical measures considered as potential green measures are discussed in the annex 3.

3. A standard on buffer strip width

The relevance of the current buffer strip requirement for water protection is clear and will be contributing substantially to water protection. However, its ambition appears to be limited in relation to the challenge we are facing in the agricultural sector.In particular a minimum width should be considered as acknowledged in several scientific assessments[3].

Annex 4 shows results of calculations on how systematic demarcation of bufferstrips along all watercourses in the EU would impact on the area of arable land in the EU. For example, the establishment of 1 m buffer strip across the EU in all rivers is roughly estimated to affect 0.05% of the arable land of the EU. A 5m buffer strip would affect 0.24% of the arable land. This shows that the impact on farming would be insignificant compared to the one on water protection.

Moreover, if one wants to ensure farms against disproportionate impacts due their localisation close to water courses, a designation of buffer strips could be combined with a ceiling for the proportion of any individual farm or with an exemption decided by the local authority.

A 5 meter buffer strip standard with such exemption rules has been successfully implemented in France since 2009.

1

Annex 1: identification of the WFD provisions relevant for cross compliance