The new European Union Strategy for Rural Development

1. AER Rural Development Conference19-20 October 2005, Exeter, Devon (UK) The new European Union Strategy for Rural Development JB. Benhaiem European Commission Co-ordinator for UK Rural Programmes

2. THE AGENDA • Context • Current EU Rural Development Policy (2000-06) • Rural Development and Lisbon objectives • New EU Rural Development Policy (2007-13) • Conclusion

3. RURAL AREAS: PROBLEMS AND CHALLENGES • Rural areas : • 56 % population of EU-25 in rural areas • 92% of the EU territory • 53 % of the EU employment • Lower : • income (1/3) • higher education • ICT broadband access, etc • Lack of : • business opportunities • contacts (remoteness, peripherality) • training infrastructure • Rural areas face challenges re. :growth, jobs and sustainability • But high potential for :growth in new sectors, rural amenities, tourism, place to live and work, natural resources and highly value added landscapes

4. 1st pillar Support to market financed by EAGGF-Guarantee 2003 reform Decoupling (from production) Conditionnality (cross-compliance) Modulation (money transfer to 2nd pillar) 2nd pillar Rural development EAGGF-Guarantee + Guidance 2003 reform Principles unchanged Reinforcement (modulation) New measures (quality, animal welfare) COMMON AGRICULTURE POLICY TO-DATE

5. Social Fund Social Fund Agricultural Fund Agricultural Fund Regional Fund Regional Fund (ESF) (ESF) (EAAGF (EAAGF - - Guarantee and Guidance) Guarantee and Guidance) (ERDF) (ERDF) Modernisation Modernisation Rural Rural Land Land Restructuring Restructuring Economy Economy Management Management Economic Economic Environment Environment Diversification Diversification Human Human Physical Physical Urban/ Rural Urban/ Rural Employment Employment Capital Capital Capital Capital Infrastructure Infrastructure LFA LFA Linkage Linkage Training Training Investment Investment Basic Basic Afforestation Afforestation Services Services LEADER APPROACH RURAL DEVELOPMENT COVERAGE (2000-06)

6. BREAKDOWN OF RD EU FUNDING FOR EU-15 (2000-06) • EU funding : bn € 52.5 • National funding : bn € 52.5 • Total RD budget: bn € 105

7. CURRENT RD AND COMMUNITY PRIORITIES • Agriculture (incl. RD) • largest user of rural land • key determinant factor for the quality of the countryside, the environment • importance and relevance of the EU CAP • Göteborg agenda and Rural Development • RD relevant to sustainable development • Promotion of high quality products, organic production, renewable raw marerial, biodiversity • Lisbon agenda and RD • RD is central to the Lisbon process • RD is a key tool for diversification, restructuration and innovation in rural areas • RD help promote competitiveness in agri-food processing (ICT, R&D) • environment and associated tourism as a major source of income and jobs

8. RURAL DEVELOPMENT POLICY 2007-2013 • New regulation (2007-13) • “tool kit” (approved Sept. 2005 ) • new strategic approach for rural development with clear focus on EU priorities (Community Strategic Guidelines) • new “European Agriculture Fund for Rural Development (EAFRD) • strengthened “bottom-up” approach • but, budget still under discussion • Broader scope • addresses innovation and restructuring needs in farming and forestry • improves environmental protection • should create more jobs and opportunities in rural areas • Simpler implementation • one fund • one programming instrument • Responding better to citizens’ concerns • food safety and quality • rural amenities

9. RURAL DEVELOPMENT POLICY 2007-2013 Simplification in future: today: • Sources of finance (funds) • systems for financial management and controls • 5 types of programming 1 fund 1 system for financial management and controls 1 programming system For all rural areas in the EU 9

10. RURAL DEVELOPMENT POLICY 2007-2013 Three core objectives: • Improving the competitiveness of the farm and forestry sector through support for restructuring, modernisation/innovation and quality production • Enhancing the environment and the countryside through support for land management • Improving the quality of life in rural areas and promoting diversification of economic activity 10

11. RURAL DEVELOPMENT POLICY 2007-2013 • 4 axes to implement the objectives: • To each core objective corresponds a thematic axis in the rural development programme • The three thematic axes are complemented by a « methodological » axis dedicated to the LEADER approach (LEADER axis) • A minimum funding for each axis is required to ensure some overall balance in the programme (10% - 25% - 10% - 5%) • As building blocks for each thematic axis a range of pre-defined measures is available 11

12. Rural Development 2007-2013 <<LEADER Axis>> « LEADER » Axis Axis 1 Competi-tiveness Axis 1 Competi-tiveness Axis 2Environment+Land Management Axis 2Environment+Land Management Axis 3Economic Divers.+ Quality of Life Axis 3Economic Divers.+ Quality of Life Single set of programming, financing, monitoring, auditing rules Single Rural Development Fund

13. RURAL DEVELOPMENT POLICY 2007-2013 Axis 1: Increasing Competitiveness Measures aiming at improving human potential:vocational training/information; setting up of young farmers; early retirement; management, relief and advisory services Measures aiming at restructuring physical potential:investments to improve production, processing and marketing structures Measures aiming at improving the quality of agricultural production and products:adaptation to new EU-standards; participation in food quality schemes; promotion for quality products Transitional measures for the new Member States (until 2013):semi-subsistence farms; setting up of producer groups 13

14. RURAL DEVELOPMENT POLICY 2007-2013 Axis 2: Land management Measures targeting the sustainable use of agricultural land: mountain areas and other areas with handicaps (LFA); Natura 2000 areas; agri-environment; animal welfare; ... Measures targeting the sustainable use of forestry land:first afforestation; first establishment of agro-forestry systems; Natura 2000 areas; forest-environment; restoring forestry production potential and introducing prevention actions; ... Note: Agri-environment measures are compulsory for each programme 14

15. RURAL DEVELOPMENT POLICY 2007-2013 Axis 2: Land management/environment Less favoured areas: Designation of areas; max. amounts; calculation of allowance • Current regime continued until 2010 • Report and proposal by the Commission in 2008 • Council decision in 2009 • New regime to enter into force in 2010

16. RURAL DEVELOPMENT POLICY 2007-2013 Axis 3: Diversification of the rural economy and quality of life in rural areas Measures aiming at the diversification of the rural economy:on farm diversification to non-agricultural activities; support for micro-enterprises; rural tourism Measures aiming at the improvement of the quality of life:Basic services; village renewal; conservation and upgrading of the rural heritage (natural and cultural) Training and capacity building 16

17. RURAL DEVELOPMENT POLICY 2007-2013 “LEADER” Axis Implementation of local development strategies through a LEADER approach to contribute to the achievement of the objectives of one or several of the three thematic axes Inter-territorial and trans-national cooperation Capacity building and working of Local Action Groups 17

18. RURAL DEVELOPMENT POLICY 2007-2013 Programming Steps • Community Strategy Guidelines setting out the EU priorities for the three thematic axes • National strategy plans translation the EU priorities to the national situation and ensuring complementarity with other policies (Cohesion policy – ESF/ERDF) • National or regional rural development programmes articulating the four axes

19. RURAL DEVELOPMENT POLICY 2007-2013 Regulation and Guidelines • Rural Development Regulation => purpose and scope of assistance from the RD fund • Community Strategy Guidelines => EU level priorities within the RDR framework, in particular focus on sustainability (Göteborg) and growth and jobs (Lisbon)

20. RURAL DEVELOPMENT POLICY 2007-2013 The Community Strategy Guidelines will help to: • identify and agree the areas where the use of EU support for rural development will create the most value addedat EU level; • make the link with the main EU priorities (Lisbon, Göteborg) and translate them into RD policy; • ensure consistency with other EU policies, in particular in the field of cohesion and environment; • accompany the implementation of the new market oriented Common Agricultural Policy and the necessary restructuring that it will entail in the old and the new Member States.

21. RURAL DEVELOPMENT POLICY 2007-2013 Community guidelines • Axis 1priorities: knowledge transfer and innovation in the food chain and focus on priority sectors for investment in physical and human capital. • Axis 2three EU level priority areas: biodiversity and preservation of high nature value farming and forestry systems, water, and climate change. • Axis 3the overarching priority of the creation of employment opportunities in the fields of diversification and quality of life.

22. RURAL DEVELOPMENT POLICY 2007-2013 Community Guidelines • Axis 4 (Leader) priority: improving governance and mobilising the endogenous development potential of rural areas. • Horizontal: Member States should ensure that synergies between and within the axes are maximised and potential contradictions avoided. They will also wish to reflect on how other EU level strategies can be taken into account. • Horizontal: The synergy between structural, employment and rural development policies needs to be encouraged.

23. MEETING THE LISBON STRATEGY THROUGH NEW RD: EXAMPLES • ICT take up by farms and food processing farms • Extension of broadband coverage to promote new way of selling • Facilitating on-farm tourism through ICT use (booking, promotion and links) • Facilitating innovation in the supply chain • Targeted investment in equipment, process and training • Innovation initiatives for quality product • Co-operation in Research & Development • Networking between R&D centres, food industry and farmers • Take up of new technologies and processes • Public-Private partnership • Leader approach • Local services designed by local people • Increasing competitiveness • Entrepreneurship • Product quality and promotion • Quality schemes and « niche » products • Job creation and rural diversification • Tourism, craft and rural amenities • Micro businesses (training, coaching, etc.) • Child care facilities • Co-operation activities on high quality farms and local products

24. RURAL DEVELOPMENT POLICY 2007-2013 The timetable • Legislative framework: Council regulation & Implementing Rules in place by end of 2005 • Community Strategic Guidelines: adoption Autumn 2005 • National strategy plans: end of 2005/beginning 2006 • RD programmes: submission 1st half 2006, approval 2nd half 2006

25. COMMUNITY FINANCING RATES • At the level of the axis as share of total eligible public expenditure • For axis 1 and 3 a maximum cofinancing rate of 50% (75% in Convergence regions) • For axis 2 and 4 a maximum cofinancing rate of 55% (80% in Convergence regions)

26. SUPPORT AND NETWORKS • Technical assistance at programme level for preparation, management, monitoring, evaluation, information and control activities (up to 4% of programme funding) • A national rural network supporting and bringing together the organisations and administrations active in rural development (financed from the technical assistance at programme level) • A European rural development network to interface with the national networks and administrations (financed from the technical assistance at Commission initiative, 0.25% of RD funding)

27. CONCLUSION • EU Rural development policy : • takes into account the needs of European rural areas and faces their challenges • complements national/regional/local policies • is an important element of the Lisbon process, in particular for rural economies • should create more jobs and opportunities in rural areas • RD programmes are just now being designed in synergy with the “cohesion” programmes at national and regional level • The challenge for all of the stakeholders in rural economies is to take part somehow in the process (planning, development, implementation) and in the rural networks.