Files
Abstract
Production linked supports are paid for
agriculture in less favoured areas (LFA) in Finland in
order to maintain agricultural production and farms.
The CAP reform increased the importance of LFA
payments and other payments which are still partly
coupled to production. We evaluate if any significant
environmental damage can be avoided without risking
maintenance agricultural production in less favoured
areas. We also evaluate the relative effectiveness of
alternative policy measures to decrease nutrient surplus,
promote biodiversity, and maintain production and
farm income. The policy options evaluated are full
decoupling, fertiliser tax, both combined and explicit
payments for reduced nutrient surpluses. The impacts of
the options are compared to the baseline assuming milk
quota abolition and continuation of production linked
CAP beef premia.
Sector model results suggest that decoupling of
certain degree would improve the effectiveness of
targeted agri-environmental support measures, and in
some cases considerable reduction in nutrient surplus is
possible with relatively minor reduction in agricultural
production and farm income. Fertiliser tax appears to
be efficient especially when combined to decoupling
while explicit payments on nutrient surpluses as well as
full decoupling have some negative side-effects.