EU Rural Development Policy
Rural development is a vitally important policy area in the European Union. It works to improve aspects of the economic, environmental and social situation of the EU's rural areas. Rural regions cover 57% of the EU territory and 24% of the EU population. Together with intermediate regions they comprise 91% of the EU territory and 59% of the total EU population. Across the EU, the dimensions of the rural-urban territorial vary — fromcountries with an explicitly defined rural character (such as Ireland, Sweden, Finland, etc.) to Member States that tend to be more urbanised (such as the Benelux countries, Malta). The policy works essentially through seven-year rural development programmes (RDPs) – which operate at either national or regional level. These are funded from the EU budget, national / regional budgets and private sources. Rural Development policy targets rural areas as a whole, with a focus on ensuring the competitiveness of farms and forestry, delivering sustainable management of natural ressources and climate action as well as create growth and jobs in rural areas.
Budget
Rural development policy is financed by three categories of funding:
- public money from the EU budget – i.e. from the EAFRD
- public money from national / regional budgets – depending on whether the programme is national or regional
- private money – in some cases, beneficiaries have to provide some funding themselves (from their own resources, a bank loan etc.)
The expected total public spending (EU + national + regional) on rural development policy in the period between 2014-2020 is EUR 161 billion.[1]
Rural development objectives and priorities 2014-2020
The three objectives and overall purpose of the CAP include:
- fostering the competitiveness of agriculture;
- ensuring the sustainable management of natural resources, and climate action;
- achieving a balanced territorial development of rural economies and communities, including the creation and maintenance of employment.
However, in practical terms RDPs are drawn up with reference to six more specific priorities, which are further divided into more detailed focus areas.[2]
- Knowledge transfer & innovation in agriculture, forestry & rural areas
- Farm viability / competitiveness, sustainable management of forests
- Food chain organisation, animal welfare, risk management in agriculture
- Ecosystems related to agriculture and forestry
- Resource efficiency, low-carbon / climate-resilient economy
- Social inclusion, poverty reduction, economic development
Rural development programmes
There is a total of 118 Rural Development Programmes(RDP) in the EU. In most Member States there is a national programme which covers the entire territory but in some countries there are several programmes, most often linked to regions: France (30), Spain(22), Italy(23), Germany(15), Portugal(3), United Kingdom(4), Belgium(2), Finland(2).
Designing Rural Development Programmes
A given RDP links the priorities of rural development policy to the situation on its territory via a SWOT analysis. The RDP then sets out a selection of measures drawn from the Rural Development Regulation to address the priorities in the appropriate way. A measure is essentially a set of one types of activity, project, investment etc. which may be funded within a RDP to achieve the priorities of rural development policy. For example, the measure Investments in physical assets as set out in the Rural Development Regulation allows support for: • investments in farms to improve their performance; • investments in processing and marketing (i.e. not necessarily only for farmers); • investments in farm- or forest-level infrastructure; and • "non-productive" (i.e. primarily environmental) investments. Measure descriptions in the EU Rural Development Regulation give information of varying detail (according to the measure) about who is potentially eligible for support, what sorts of activity etc. can be supported, and whether there are limits on how much support may be offered. MS follow the rules for a given measure but, within this framework, still enjoy considerable flexibility about how they use it. For example, a MS might choose to make the measure Investments in physical assets available in its RDP, but only with regard to environmental investments.
Use of targets
In explaining how it will use the various measures together to address the priorities / focus areas of rural development policy within its RDP, the MS / region set various targets against these. The nature of the target varies according to the focus area. For example, against focus area 5A – Increasing efficiency in water use by agriculture – the standard target indicator is the percentage of the Irrigation area in the programme area which is expected to switch to more efficient irrigation equipment as a result of rural development support.
How programmes are drawn up, approved and amended
A MS / region draws up its RDP in close consultation with a wide range of interested parties, including bodies representing Civil society. The MS / region submits its RDP to the Commission for analysis. The Commission approves the RDP when satisfied concerning its legality and quality (usually after several months of detailed discussion with the MS concerned). RDPs usually need to be amended several times during their seven-year life, to keep them as relevant, effective and efficient as possible – in light of changing circumstances and the findings of monitoring and evaluation. Programme amendments which go beyond surface details require the Commission's approval.
How beneficiaries are selected for support
When a RDP has been drawn up and approved, it is advertised. People, businesses etc. which would like to receive support for projects apply for it. Provided that they are eligible for the type of support in question (according to the RDP), they may be selected for support on the basis of objective selection criteria .
- Example: In a given RDP, a MS has decided to offer support for environmental investments in forests under the measure "Investments in forest area development". The measure as set out in the Rural Development Regulation allows a wide range of entities to be eligible for support. The MS decides to keep this broad approach in terms of eligibility, but to give priority to "private forest-holders". At the moment when projects are selected for support, therefore, extra selection "points" will be awarded to applications from private forest-holders. This approach would be announced in overview in the RDP itself, but worked out in detail in subsequent national implementing rules.
Monitoring and evaluation
Monitoring is essentially about tracking how fast, and in what way, RDPs are being implemented – with reference to financial data and other indicators. RDPs are monitored continuously. Within this process, programme authorities must each send an annual implementation report for each programme by 30 June every year, starting in 2016 and ending in 2024. Evaluation involves rather deeper analysis (especially of effectiveness, efficiency and impact). The key stages are:
- Ex ante evaluation: Drawn up under the responsibility of the relevant programme authority, this is submitted to the Commission at the same time as the programme, and assesses the programme's quality.
- Evaluation during the programming period (in enhanced Annual Implementation reports 2017 and 2019 in particular): MS arrange for this to be done on the basis of an evaluation plan. The Commission may also carry out evaluations if it wishes.
- Ex post evaluation: Drawn up under the responsibility of the relevant programme authority, this is submitted to the Commission by the end of 2024.
- Synthesis of evaluations: Syntheses at Union level of the ex ante and ex post evaluations are undertaken under the responsibility of the Commission and completed by 31 December of the year following the submission of the relevant evaluations.
The monitoring and evaluation processes draw on a range of indicators concerning financial execution, outputs, results and impact.
Ex ante conditionalities
Ex ante conditionalities (EACs) help to ensure that MS have set the right background conditions for spending funds effectively and efficiently through their programmes. Some EACs are "general" in the sense that they apply to all of the European Structural and Investment (ESI) Funds.
- Example: MS must have in place arrangements for applying EU public procurement law in the fields covered by the ESI Funds. This is important because many programmes will allocate significant sums to projects covered by public procurement rules.
- Other EACS are "fund-specific" (they do not apply to all ESI Funds). The EAFRD has its own EACs.
- Example: MS must have set out standards for Good Agricultural and Environmental Condition (GAEC) in national law and must specify them in their RDPs.
MS declare their fulfilment or non-fulfilment of EACs in their programmes, and summarise it in their Partnership Agreement. The Commission checks this information. When a MS does not meet some or all EACs, usually the MS is required to follow an action plan which allows it to meet the EAC by the end of 2016. In more exceptional cases – if failure to meet a given EAC is deemed to cause "significant prejudice" to the achievement of certain objectives – payments related to the priority concerned within that programme may be partly or wholly suspended until the problem is resolved.
Performance reserve
6% of the EAFRD financial resources allocated to a given RDP are placed in a performance reserve, which is provisionally divided up between some or all of the rural development priorities.
After receipt of the 2019 annual implementation reports, the Commission checks which priorities have "performed well" – i.e. against which priorities particular "milestones" (key targets) have been met. Where the milestones of a given priority have been met, the sum from the performance reserve initially allocated to that priority is confirmed. Where the milestones of a given priority have not been met, the sum initially allocated from the performance reserve is transferred to priorities whose milestones have been met. This approach is intended to focus minds more sharply on achieving results.