Crisis reserve part of deal to cut CAP budget

Intervention payments or export subsidies to help farmers through market slumps will have to be funded from reductions in direct aid payments to farmers, as part of last week’s EU budget 2014-2020 agreement.

Heads of state agreed a market support “crisis reserve” from 2014, whereby if butter intervention is needed to boost milk prices during a market slump, for example, all farmers within and outside the dairy sector will have to pay for it.

The crisis reserve is part of the agreement to cut the CAP budget 11%, as part of the first ever reduction in the EU’s seven-year budget.