The Next Steps in CAP Reform

summary Both Pillars of Europe's Common Agricultural Policy have been thoroughly overhauled in the period 2003 to 2007. By far the most important aspect of these reforms is the decoupling of the main support instrument of the CAP - the Single Payment. This removes the bulk of EU farm support into the non-production and trade distorting Green Box of the WTO. Despite these far-reaching changes, discussions are already underway for further CAP reforms both before 2013 in what is being called the CAP Health Check, and certainly thereafter as all EU policies and resources are to be reviewed in 2009. This article discusses the possible contents of such reforms and focuses on three main areas. Firstly, the downscaling of commodity supports, particularly the use of intervention purchases to raise domestic prices and their replacement with the Single Payment System. Secondly, replacement of the existing variety of Single Payment Schemes with a more harmonised scheme. Thirdly, the prospects for changing the balance between Pillars I and II of the CAP Finally, there is consideration of the prospects for reform of the CAP beyond 2013 towards what nowadays might be called Europe's Food and Environmental Security Policy, to deal with all the missing, imperfect and failing market issues affecting land use. Copyright The Agricultural Ecomomics Society and the European Association of Agricultural Economists 2007.