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21.5.  EU rural development policy

  1. The financing of rural development in the EU
  2. EU rural development objectives and priorities
  3. EU rural development programming
  4. The LEADER Community-led local development
  5. Rural development measures for EU candidate countries

According to the Treaty on the functioning of the EU, in working out the common agricultural policy and the special methods for its application, account is to be taken of the particular nature of agricultural activity which results from the social structure of agriculture and from structural and natural disparities between the various rural areas. Main objectives of the common agricultural policy are: (a) to increase agricultural productivity by promoting technical progress and by ensuring the rational development of agricultural production and the optimum utilisation of the factors of production, in particular labour; and (b) thus to ensure a fair standard of living for the agricultural community, in particular by increasing the individual earnings of persons engaged in agriculture (Article 39 TFEU, ex Article 33 TEC). Unlike market organisation and pricing policy, which requires uniform provisions and centralised management, socio-structural policy may remain more in the realm of the Member States in that it has to be adjusted to the specificities of the different regions. But structural policy blueprinting and supervision is brought under the wing of the European Union to promote economic and social cohesion and prevent uneven competition conditions for European producers [see sections 12.1.2 and 12.2.1].

Rural areas face particular challenges as regards growth, jobs and sustainability in the enlarged Union. But they offer real opportunities in terms of their potential for growth in new sectors, the provision of rural amenities and tourism, their attractiveness as a place in which to live and work, and their role as a reservoir of natural resources and highly valued landscapes. Therefore, a rural development policy accompanies and complements the market and income support policies of the common agricultural policy and thus contributes to the achievement of that policy’s objectives as laid down in the Treaty. Rural development policy also takes into account the general objectives for economic and social cohesion policy set out in the Treaty and contributes to their achievement, while integrating other major policy priorities, such as the ''Εurope 2020'' strategy on growth and employment. The rural development policy currently aims at restoring and enhancing the competitiveness of rural areas, thus contributing to the maintenance and creation of employment in those areas. The reformed rural development policy covers, since January 2007, all rural areas in the EU through a single instrument,  the European Agricultural Fund for Rural Development (EAFRD) [see sections 21.3.3 and 21.5.1].

The European Union’s new policy for rural development - as the second pillar of the CAP - seeks to establish a coherent and sustainable framework for the future of rural areas aiming at restoring and enhancing competitiveness and therefore contributing to the maintenance of employment. Structural intervention favours diversification and widening the economic fabric in rural areas. It aims to exploit the endogenous potential of these areas in order to create new jobs or develop new extra income sources thus contributing to stabilising their population. The four basic principles of the new policy are:

- subsidiarity and partnership achieved through the decentralisation of programming arrangements and consultation at regional and local level;

- multi-functionality that rewards farmers for the range of services they provide in meeting the expectations of consumers and wider society, including the preservation of the rural heritage, while emphasising the creation of alternative sources of income;

- a multi-sectoral approach that seeks to develop the rural economy by creating new sources of income and employment, by developing rural services and conserving the countryside and the rural heritage;

- efficiency and flexibility sought through the implementation of strategic, integrated programmes, based on a "menu" of measures implemented according to the needs and circumstances in the Member States and regions.

Agricultural structural policy requires exact information on farm income and on production parameters of the agricultural economy in the EU. This is the task of the Farm accountancy data network (data network) [Regulation 1217/2009, last amended by Regulation 2016/2129]. The data network relies on the services of farm accountancy offices in the Member States and on the participation of specially selected agricultural holdings to produce objective and practical data on the economic situation of the various categories of agricultural holdings, including those upon which a close watch needs to be kept at European level [Regulation 1166/2008, last amended by Regulation 378/2014]. The "Community typology for agricultural holdings",  which is a uniform classification of holdings in the EU according to their type of farming and economic size and to the importance of the other gainful activities directly related to the holding, is used for the presentation, by type of farming and by economic size class, of data collected through the Community farm structure surveys and the Community Farm Accountancy Data Network [Regulation 1242/2008].

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