Agricultural policy

More cash for sustainable agriculture

Agriculture can make an effective contribution to climate change mitigation, environmental protection, nature conservation and animal welfare. In 2020 a total of up to 75 million euros in additional funding is to be made available to promote relevant measures, the Cabinet decided today.

With this decision, the German government aims to strengthen farmers who commit to sustainable farming methods. The new bill will make it possible to reallocate 6 per cent of funding received under the "first pillar" of the common agricultural policy (CAP) (direct payments) to the "second pillar". This means that more cash will be available for measures that serve to protect the environment or promote organic farming.

The common agricultural policy

Within the framework of the EU agricultural policy, farmers receive "direct payments" to underpin their income and offset risks. This "first pillar" of the common agricultural policy is based on the area of land farmed, i.e. the larger the area farmed, the higher the direct payments. For the promotion period 2014 to 2020, Germany receives around 4.8 billion euros a year from the EU under this pillar.

Promoting environmental protection and organic farming

The funds from the "second pillar" are used specifically to finance programmes that promote sustainable and environmentally sound farming methods and rural development. Organic farming and various agricultural environmental programmes are financed, for instance. Some of the cash is channelled into village development, internet coverage, tourism and flood protection. Under this pillar, Germany receives around 1.4 billion euros a year.

By 2030, the German government aims to raise the percentage of farmland farmed organically to 20 per cent. The current figure is 9 per cent.

More cash for rural development

To date, under the Direct Payment Implementation Act (Direktzahlungen-Durchführungsgesetz) for application years 2015 – 2019, a total of 4.5 per cent of the annual funding received from the EU for direct payments can be reallocated as additional funding to promote rural development. This bill would raise the percentage by 1.5 per cent to 6 per cent. The change in the law aims to ensure that measures financed to date using reallocated funds can continue to be financed and that additional new measures can be launched.