The CAP and its Reform - Half a Century of Change?

In the fifty years since the Stresa Conference, the CAP has undergone many changes. Its presence, however, has been one of the most prominent and constant features of the 'European project'. This article outlines how the policy has changed and identifies the key pressures driving that change, in the context of unchanging formal objectives for the policy. Having established price support as the primary means of supporting farm incomes, crucial elements of the EU budget process then combined with rising production and surpluses to put the CAP on a path that led inexorably to financial crisis. As the EU began to deal with these pressures, so price support was already taking the policy towards another pressure point - growing subsidised exports and, ultimately, clashes in the GATT over trade-distorting policies and their effects on other countries. In the reforms since 1992, designed to address both budget and trade concerns, the direction the policy has taken has also been influenced by newly-emerging issues, notably the welfare and health of the environment, animals and consumers. Yet despite all these changes and the vast sums spent, the extent to which the farm income problem has been resolved remains unclear. Despite the centrality of income concerns to the CAP, data on farm household incomes remain limited - and there exists considerable political opposition to changing this situation. Copyright (c) 2008 The Author. Journal compilation (c) The Agricultural Ecomomics Society and the European Association of Agricultural Economists 2008.