The Common Agricultural Policy (CAP) is the agricultural policy of the European Union. It implements a system of agricultural subsidies and other programmes. It was introduced in 1962 and has since then undergone several changes to reduce the EEC budget cost (from 73% in 1985, to 37% in 2017) and consider rural development in its aims. It has however, been criticised on the grounds of its cost, its environmental, and humanitarian effects.
The CAP is often explained as the result of a political compromise between France and Germany: German industry would have access to the French market; in exchange, Germany would help pay for France’s farmers. The CAP has always been a difficult area of EU policy to reform; it is a problem that began in the 1960s and one that has continued to the present, albeit less severely. Changes to the CAP are proposed by the European Commission, after a public consultation, which then sends its proposals to the Council and to the European Parliament. Both the Council and the European Parliament have to agree to any changes. The Parliament was involved in the process of change for the first time in 2013. The involvement of the Parliament, which represents the citizens, increases the democratic legitimacy of the CAP. Outside Brussels proper, the farming lobby power has been a factor in determining EU agricultural policy since the earliest days of integration.
In recent times change has been more forthcoming because of external trade demands and intrusion in agricultural affairs by other parts of the EU policy framework, such as consumer advocate working groups and the environmental departments of the Union. In addition, Euroscepticism in states such as Denmark (and formerly the UK) is fed in part by the CAP, which Eurosceptics consider detrimental to their economies.
Proponents claim that the CAP is an exceptional economic sector as it protects the “rural way of life” although it is recognized that it affects world poverty.
The policy has evolved significantly since it was created by the Treaty of Rome (1957). Substantial reforms over the years have moved the CAP away from a production-oriented policy. CAP has been divided into two ‘pillars’:
Agricultural production support and common organization of markets (I pillar, known otherwise earlier as the ‘agricultural guarantee’ section)
Rural development policy (II pillar, otherwise the ‘agricultural structural policy’ pillar, known earlier as the ‘agricultural guidance’ section).
Accordingly, the European Agricultural Guidance and Guarantee Fund (EAGGF) of the EU, which initially used to fund the CAP as a whole, has been replaced in 2007 with two separate funds, one for each of the two pillars:
CAP reforms have steadily lowered its share in the EU budget: in 1980 it accounted for more than 70% of the EU expenditure while in 2021 it accounted for less than 25%. In 2019 France was the biggest beneficiary of the policy by 17.3%, followed by Spain with 12.4% and Germany (11.2%), Italy (10.4%), Poland (8.1%) and the UK (7.2%). The 2003 reform introduced the Single Payment Scheme (SPS) or as it is known as well the Single Farm Payment (SFP). The most recent reform was made in 2013 by Commissioner Dacian Ciolos and applies for the period 2014 to 2020.
The Common Agricultural Policy (CAP) is the agricultural policy of the European Union. It implements a system of agricultural subsidies and other programmes. It was introduced in 1962 and has since then undergone several changes to reduce the EEC budget cost (from 73% in 1985, to 37% in 2017) and consider rural development in its aims. It has however, been criticised on the grounds of its cost, its environmental, and humanitarian effects. 
