EU speeds up delivery of €8 billion in aid to farmers

Parliament and Council reached a provisional deal on Tuesday on an EU recovery package for farmers, food producers and rural areas that should boost their resilience.

The political agreement still needs to be formally endorsed by both the Parliament and the Council.

Negotiators agreed to frontload all the funds made available for rural communities from the EU recovery instrument to 2021 and 2022. The Commission had proposed to release the funding between 2022 and 2024. Around 30% of the €8.07 billion aid will become available in 2021, and the remaining 70% would be released in 2022, says the agreed text.

MEPs managed to secure at least 37% of the recovery funding for organic farmers, for environment and climate-related actions and for animal welfare. At least 55% of the fund will support young farmers’ start-ups and on-farm investments that contribute to a resilient, sustainable and digital recovery. The share of recovery funding that EU countries will spend on environmentally beneficial practices should not be lower than the percentage of the EU rural development envelope they currently spend to this end.

Higher EU co-financing without contribution from EU countries

The EU will finance up to 100% of eligible measures from the additional funds provided by Next Generation EU. EU countries will not have to contribute any additional money from their national budgets.

Negotiators agreed that investments made by farmers and food processors that contribute to a sustainable and digital economic recovery can be supported up to a level of 75% of incurred costs. MEPs also managed to increase the ceiling for the business start-up aid from the Rural Development Fund for young farmers from €70.000 to €100.000.