EL EMBARGO SOBRE BIENES:

regulation, maximum stocking rates apply, to limit overgrazing, and top- up payments are available for a range of environmental activities, for example reduced stocking rates. These included an additional 10% payment for registration with an approved organic certification body, effectively an organic maintenance payment, although farmers receiving OFS payments were not eligible for this support for dual funding reasons.

The financial impacts of the change from headage to area based systems and the special provisions for organic farmers are considered in more detail using the LFA farm model below.

5.8.1.6.7 Woodland Grant, Farm Woodland and Energy Crops Schemes.

The woodland grant scheme was first implemented in 1988 to replace the tax allowances on investments in new woodlands, which promoted short rotation conifer plantations with limited economic and environmental benefits. The farm woodland scheme was also implemented in 1988 to encourage farmer diversification into forestry. The difference between the two schemes is that the woodland grant scheme was open to all landowners and tenants, and included urban areas and brown field sites. All these schemes are available to be linked to the organic farming scheme as long as different portions of the farm area are being utilized, but there is no differentiation in support or eligibility between organic and conventional producers and it has not been possible to obtain data on the extent to which organic farmers have taken up this support compared with conventional. Organic producers can and do benefit from the provisions, and there are initiatives by organisations such as the Soil Association to certify organic woodland. The integration of trees within farming systems (as woodlands, agro-forestry, permaculture, orchards and other forms of perennial cropping, for food, timber and fuel

production) can in general terms be seen as valuable in developing more biodiverse agri-ecosystems, and perhaps further consideration should be given to specific treatment of organic farming in this context.

The energy crops scheme like the woodland schemes has forestry benefits and rural employment as its stated goals, however, the

overriding aim of the scheme is to supply carbon neutral energy and thus go some way to meeting the Kyoto protocol targets. Due to foot and mouth disease and lack of end point processors, uptake of the scheme had been poor, and no organic farmers have applied for the scheme. 5.8.1.6.8 Investments in Agricultural Holdings

In Wales, the Farm Improvement Grant aims to assist farmers to “adopt best practice, to make animal welfare, hygiene and product quality improvements and to enhance, protect and maintain the environment of the farm”, with the following categories of activities being eligible: a) preserving and improving the natural environment (especially suitable for farmers unable to qualify for Tir Gofal); b) pollution and waste management (activities must take the farm above existing statutory requirements, and include slurry storage, dirty water disposal, injection of slurry below soil surface, etc.); and c) animal welfare, stock and crop management (capital work required to meet retailers’ standards of

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animal welfare and health, environmental protection). To be eligible for these grants, farmers must have completed a Farm Business

Development Plan provided through Farming Connect (see below). The maximum rate of grant aid is 40% of total eligible costs (50% in Less Favoured Areas). For young farmers the maximum rate is 45% (55% in Less Favoured Areas).

Within the English and Welsh rural development plans, there are no specific provisions for special treatment of organic producers with respect to investment aids. Capital grants are in general terms targeted at investments likely to benefit the environment, and therefore are of interest to organic and conventional producers alike. However, in

Scotland and Northern Ireland, proposals are being developed relating to targeting aid at investment in buildings etc. required as part of the conversion to organic farming. There has also been a debate concerning higher capital grants for manure and slurry storage in Nitrate Vulnerable Zones and whether organic producers should also qualify for the same level of support, given that Council Regulation (EC) 2092/91 imposes the same nitrogen use limits as the nitrates directive. This has not yet

received a positive response and is unlikely to be acted on in the foreseeable future.

5.8.1.6.9 Processing and marketing

Processing and marketing grants (PMG) enable capital investments in processing and marketing of primary agricultural products. As well as encouraging new projects, the aim of the programme is also to improve already existing processing facilities. Producers marketing their products collaboratively or individual producers who wish to process and market their own produce are eligible for support.

In England, whilst small and medium enterprises are a specific target, there is a lower ceiling of project costs being over £70,000 (101,500 €) and a higher ceiling of total grant payment of £1.2 million (1.7

million euro). £44 million (64 million euro) has been made available over the period 2001 to 2006, in 2001 £4 million (6 million euro) is available rising to £8 million (12 million euro) in 2002.

In Wales, the PMG scheme funds up to 40% of eligible scheme costs in Objective 1 areas and 30% in non Objective 1 areas. In 2002, grants of £808,952 (1.2 million euro) were made to nine organic agri-food businesses in Wales.

While there are no specific additional funds for organic projects, and specific data is difficult to obtain for England, the uptake of processing and marketing grants by organic producers and processors would appear to be higher than the share of organic farming in agriculture as whole, indicating both a greater willingness on the part of organic producers and processors to apply for such funds, and a willingness on the part of the funders to support organic projects.

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The vocational training schemes provides funding for training specifically aimed at improving workplace skills of farmers, those involved in farming and forestry and enhancing their opportunities for diversification.

In England, the aim of the scheme is to provide locally targeted training linked to other RDP schemes especially rural enterprise schemes. Applications for training are open from: individuals, businesses as well as groups of businesses, those in ERDP schemes or from areas such as ESAs. As part of the application, trainees provide a training needs assessment demonstrating how the training will enhance the

performance of their business. Farmers and foresters do not qualify for the scheme if they are in an Objective 1 area. Training is to be provided by recognised trainers from pre-existing training organisations, with high priority skills areas including IT, traditional craft and countryside management skills, farm management and business development along with innovation and leadership skills and practical experience to underpin more formal types of education. Applicants are expected to fund a minimum of 25% of the training costs. A network of pilot and demonstration farms is also supported across England, including 2 organic farms.

In Wales, vocational training is provided through the Farming Connect service, which integrates the activities of the Welsh Assembly

Government, ELWa, Lantra and the Welsh Development Agency as public bodies and a range of service providers. Farming Connect provides advice to farmers in the form of farm business development plans (which are a requirement for access to other financial support and include a training needs assessment), environmental and specialist technical advice and supports a network of demonstration farms and farmer discussion groups across Wales. Farming Connect also supports a range of training courses, currently mainly focused on IT, business and environmental management issues, but programmes to support training in other areas of identified need are currently under development. The funding is derived from a combination of Objective 1, 2, RDP and other resources.

Training courses, demonstration farms, discussion groups and other extension activities for organic farmers in Wales are supported as part of the Farming Connect Organic Development Programme, operated by Organic Centre Wales, which is relatively well resourced compared to the size of the sector in Wales. The organic programme had a total budget of £550,000 (0.8 million euro) for 2002 and 2003, but funding is likely to be reduced in coming years.

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5.8.1.6.11 Rural Economy (Art. 33) schemes

Amongst the measures aimed at promoting the adaptation and development of rural areas are the marketing of quality agricultural products, diversification of agricultural activities and the protection of the environment in connection with agriculture as well as with the improvement of animal welfare. Rural economy schemes have as a central tenet the remit to diversify rural economies and present them with the opportunity to meet the demands of a changing consumer base. In England, the Rural Enterprise Scheme covers a very broad range of eligible activities, ranging from ones that provide economic benefits through to those more beneficial in social and environmental terms. In 2001, 207 agreements were made to a value of £12.1 million (18 million euro). Although support for farmers is a primary aim, farmers, rural businesses, community groups as well as partnerships are all eligible. Support can also be given to bodies which promote and co-ordinate multiple applications related to specific themes or sectors, however, public sector organizations are prohibited. In total, the government has committed £152 million (220 million euro) for the 7 year period with the majority of funding being allocated to regional budgets.

In Wales, the Farm Enterprise Grant aims to assist activities directed at “diversification of and towards agriculture”, such as new farm

enterprises covering sectors/species currently not on the farm (including energy crops), setting up farm shops, direct sales and pick-your-own, and the Small Food Processors Grant aims to assist in the development of on- farm added value processing of agricultural products - e.g., assistance for the construction or conversion of buildings, purchase of equipment needed for processing, etc. (limited to projects costing less than £40,000 (58,000 €).

Whilst organic farming is included as being a specific beneficiary, it is not clear at this stage to what level that organic farming is being supported by such schemes.

5.8.2

Quantitative evaluation

The provisions aimed at maintaining or enhancing on-farm

environmental quality present organic farmers with a clear opportunity to benefit from the schemes. It is not clear, in the absence of uptake data, to what extent (if any) organic farmers would benefit more or less from such schemes than conventional farmers.

A number of provisions dealing with diversification, training, and so on appear to be well-suited to meet the needs of organic producers and may provide conventional farmers with incentives for conversion. The focus on high quality, high value-added products and on encouraging farm enterprises to become more ‘innovative’ – which is evident throughout the Rural Development Plan – also seems potentially beneficial to organic farmers or those considering conversion.

The previous round of CAP Reform and the greater spending on the Organic Farming Scheme as compared to the previous Organic Aid Scheme saw an unheralded expansion of organic farming in England

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