ABSTRACT
Introduction Agri-environmental schemes are payments to farmers and other landholders to address environmental problems or promote the provision of environmental amenities (OECD 2003). Such payments may include implicit transfers such as tax and interest concessions. Agri-environmental measures are generally considered as belonging to the so-called “green box” of World Trade Organization (WTO) negotiation. In this chapter, we examine area-based agri-environmental measures (AEM) as the most important part of payments for improving environmental objectives in agriculture. In the framework of the current European rural development policy under Council Regulation (EC) No. 1698/2005 and former Council Regulation (EC) No. 1257/1999, AEM summarized in agri-environmental programs (AEP) are the only mandatory parts of Rural Development Plans (RDP). AEP are implemented in all European member states at different spatial and administrative levels. Within the subsidiarity principle,1 there is much room for the member states and regional authorities to design specific agri-environmental measures. During the last planning period (2000-2007) alone, 68 RDPs were implemented in the old EU member states (n = 15) (COM 2003). However, the number of agri-environmental programs was probably double (compare Buller (2000) for the planning period 1992-1999). Currently, nearly all AEM are action-oriented as opposed to result-oriented. Payments of action-oriented AEM are based on farm practices such as the reduction of livestock density. An important distinction has been made between “broad and shallow” and “deep and narrow” schemes (sometimes known also as “light green versus dark green” schemes). “Broad and shallow” schemes, also called “horizontal” schemes, tend to include a large number of farmers, cover a wide area, make relatively modest demands on farmers’ practices, and pay correspondingly little for the environmental service provided. “Deep and narrow” or “dark green” schemes tend to target site-specific environmental issues and therefore include fewer farmers (COM 2005a). Horizontal measures, such as extensive grassland land management, represent the most important kind of AEM in terms of supported
area. It is typical with this kind of AEM for environmental objectives to be quite general. Critics argue that “EU programs tend to be oriented towards multiple, sometimes nebulous goals” (Baylis et al. 2005: 268). Without clear goals, AEM are assessed as less effective, at least for specific environmental objectives (Primdahl et al. 2003; COM 2004; COM 2005b; Feehan et al. 2005; Knop et al. 2006; Kleijn et al. 2006). In particular, the lack of spatial equivalence for horizontal AEM is one of the main causes of effectiveness deficits (Piorr and Matzdorf 2004). One way to improve spatial equivalence is to set up locally specific implementation areas. Such Environmentally Sensitive Areas (ESA) have been implemented in the United Kingdom since 1992. However, even in the United Kingdom, the biggest portion of AEM is not implemented site-specifically within horizontal schemes such as Countryside Stewardship Schemes (JNCC 2007). An effective spatial management, based on ecologically defined regions and relationships, is “a challenging and radical departure from standard practice” (Scrase and Sheate 2002) and ultimately a question of transaction costs (Falconer et al. 2001; Rodgers and Bishop 1999) as well as equity considerations. Potential transaction costs as well as equity reasons could be seen as the main rationale for the resistance administrative bodies show toward these approaches. In addition to these constraints, centrally prescribed sensitive areas can also be ineffective, especially with regard to species and habitat diversity. With the issue of biodiversity, the entire range of site conditions, including historical use, has to be taken into account. Above all, the definition of inflexible management requirements is often less successful within the context of biodiversity. The impact assessment of AEM on biodiversity shows the specific issue (e.g. Kleijn et al. 2001; Swetnam et al. 2004; Herzog 2005). Due to this fact, it is not surprising that first examples of result-oriented payments, as another opportunity to improve the effectiveness of AEM, are implemented to protect and to enhance biodiversity. Result-oriented, performance-based payments are directly linked to the desired ecological good or objective (Gerowitt et al. 2003; Matzdorf 2004a). For example, a farmer may receive payments for a “species-rich wet meadow.” Action-oriented payments are linked to an adapted agricultural management practice that leads to the production of environmental goods. The farmer may receive payments for refraining from spreading manure in his meadow and for mowing it only once a year. The line between result-oriented and action-oriented approaches is blurred, but can be defined by the number of options for action. In the case of incentives linked to specific environmental goals, farmers see environmental objectives as environmental goods and incorporate them into their economic calculation. Thus, farmers select the most appropriate (sensitive) areas in a decentralized way. They also enjoy greater flexibility in choosing methods for achieving the environmental objectives, and their choice is determined by their individual rational decision. For these reasons, result-oriented remuneration is considered to have many advantages. Result-oriented remuneration prompts farmers to pursue environmental
objectives for their own benefit, increases innovation potential, reduces information asymmetries, promotes cooperation between farmers and improves farmers’ intrinsic motivation and interest in environmental objectives (Matzdorf 2004b). There are first implementations of result-oriented agri-environmental measures (roAEM) in Switzerland and in the federal state of Baden-Württemberg (Germany) in the field of grassland biodiversity (Oppermann and Gujer 2003). Considering the political framework, the implementation of the regional AEP MEKA program2 in Baden-Württemberg (BW) is very interesting. BW is the first federal state in the EU that has introduced a roAEM within the regional agri-environmental program under Council Regulation 1257/1999 in 2000. This example has shown that such an approach is in line with the current institutional framework of the EU’s Common Agricultural Policy (CAP). The objective of the AEM titled “Rewarding of a great variety of plant species on grassland” is to support the protection and maintenance of species-rich, extensively and traditionally managed grassland. In our chapter we give three examples of how roAEM can be designed and implemented in AEPs under Council Regulation 1698/2005. We developed these approaches for the federal state of Brandenburg in Germany. Two examples deal with the issue of biodiversity on grassland, and one deals with N-non-point pollution and the issue of water quality.
