The discussion on the modernisation of the Common Agricultural Policy (CAP) is in full progress and one element is how the CAP will stimulate and benefit from ongoing digitisation of the agricultural sector: it reduces administrative burden and digitisation is expecting to improve the sustainability and competitiveness of the sector. CAP modernisation also offers potential for data use and reuse and thus improves accessibility of CAP data for monitoring the societal benefits of agriculture towards climate, environment and rural development. The ongoing operationalisation of the Copernicus satellite programme and the use of Earth Observation data for many aspects in agriculture is a very prominent innovation with unprecedented impact on the monitoring of agricultural land. In addition, the market availability of new tools and technologies and the increased interoperability between different ‘sub’ systems, like open data, farm management and information systems, telemetry on farm machinery and local sensors provide additional incentives to modernise governance of our sector.
Paying Agencies from 9 EU Member States join forces to realise a new vision on the Integrated Administration and Control System (IACS) – the instrument for CAP governance – in this project called: “New IACS Vision in Action” (NIVA). This project demonstrates a clear intention to collaborate in exploring innovations and working together in creating an innovation ecosystem. These Paying Agencies recognise that grasping the potential of digitisation calls on innovating their systems and approaches. Encouraged by new EU legislation on Monitoring and the plans of the commissioner for Agriculture and Rural Development on the future of CAP, these Paying Agencies will demonstrate how these digital tools will enhance their operation and at the same time lead to new opportunities for farmers and industry to improve farming processes and techniques to contribute to sustainability and competitiveness of the agricultural sector. These innovations are also important for the future CAP which focuses on agricultural performance.
In setting up this proposal, Paying Agencies have identified and discussed prime use cases in digital innovation of their processes and systems, which represent common goals. Each use case involves the stakeholders required to demonstrate and evaluate these innovations. The cross-cutting digital and process innovations are further developed and made available as open source tools even beyond the consortium members. Together, these use cases constitute a complete new IACS vision. Herewith, Paying Agencies and the involved actors introduce modernised elements in the IACS system. This will help Paying Agencies, farmers, advisors and solution providers prepare for the new challenges that Europe wants to address in the future CAP.
NIVA delivers a suite of digital solutions, e-tools and good practices for e-governance and initiates an innovation ecosystem to support further development of IACS that will facilitate data and information flows. The project’s results promote a transparent, simpler administrative process that contributes to a future CAP that increases environmental performance. The project will increase the speed of innovation, reduce administrative burden, sustain broader and deeper collaboration in an innovation ecosystem and provide accepted methods to establish information flows to improve environmental performance. The project is built on three cycles, ensures fast results, built-in flexibility and greater involvement of stakeholders. NIVA strives for maximum impact by involving all other European Paying Agencies in a Reference Group that will be actively involved. Those and other relevant actors will join our stakeholder board. Also, the project includes an open call for flexibility in development. The project creates and boosts an innovation ecosystem to continue the collaboration after the project. The cross cutting digital innovations are managed in a dedicated work package. Also, interoperability issues are managed in a dedicated work package: Defining, accepting and defending common standards is exemplifying the desire for collaboration. The nine prime use cases are demonstrated in three cycles (national, multi-national, pan-European), hence underlining our ambition to make a significant contribution to improved digital competences, awareness and innovation on CAP at the European scale.
Agricultural activities have substantial impact on climate, environment and sustainable development. The EU is strongly committed to the Paris Climate Agreement as well as to the United Nations Sustainable Development Goals (SDGs)1. These commitments cannot be met without active engagement of the farmers and other rural actors who manage nearly two thirds of land in the EU and receive payments for that through the Common Agricultural Policy (CAP). Such commitment is also reflected in a recent EU communication2, stating that “a modernised CAP should enhance its EU-added value by reflecting a higher level of environmental and climate ambition, and address citizens' concerns regarding sustainable agricultural production”. But changing the CAP into an instrument that rewards performance requires significant changes, also on the IT systems. CAP governance is instrumented by the Integrated Administration and Control System (IACS), and has 44 different implementations in the Member States, due to federal structures several satellite systems that are processing and feeding data into the central systems. These implementations fit the national organisation and relations between farmers, farmer organisations, paying agencies, control agencies and other involved parties. As consequently a single pan-European IACS is currently not feasible, the development of common components and innovations as solutions for similar issues EU-wide would facilitate a cost-effective delivery model of new IACS with a series of results of future EU policies (not only CAP but also other policies). In our new vision on IACS, all different implementations of IACS can benefit from digital innovations and therefore these systems contribute to improved social, economic and environmental performance of farmers. Currently, new legislation is proposed to make more use of digital advances for IACS, in particular in using Copernicus data for monitoring and other data sources to do cross checks. This will simplify the CAP governance, therefore reduce administrative costs. It will also open up the IACS for external data-reuse, with these monitoring datasets of independent source.
One of the most promising data sources to report on economic, social and environmental performance: the “Integrated Administration and Control System” (IACS), that has been set up by all member states to manage the implementation of the CAP.
A core part of the IACS is its information system called “the Land Parcel Identification System” (LPIS). The data the LPIS holds are geo-referenced polygons of land parcels (units of management or production), and information on the type of land cover, as a minimum in terms of broad categories such as arable land, grassland, permanent crops, and broad families of crops, with their area (eligible hectares). The LPIS is a database that provides very detailed and accurate information on the status of agricultural land cover at any given time since 2005. The potential of the LPIS to efficiently track land use changes can be derived from the pan-European definitions of agricultural land cover types, and the mandatory adequate update cycle of the dataset. In studies contracted by DG-CLIMA, in meetings and workshops, the necessity of the availability of LPIS data is stressed by many potential users of this kind of information. However, there is a huge difference between general LPIS data and more specific annual data which often brings more added value for the desired purpose. In a recent study by JRC, only in the Netherlands and Flanders, LPIS are fully accessible. Other countries have limited or no access yet. In this project, the barriers for sharing LPIS data, including a clarification concerning the confusion on the relevant data concerned are investigated and lifted in different use cases. Figure 1-1 provides a schematic overview of relevant functions in IACS as it is and how it can be with the new legislation in place.
Figure 1-1: A schematic representation of the Integrated Administration and Control System (IACS) as it now (left) and what is expected to change (simplify) by the newly introduced monitoring approach (right).
Furthermore, the IACS is built upon several other core systems collecting farm data, payment rights, livestock and other information which overall constitute an Agricultural Knowledge Information System (AKIS) which shall all-together contribute to a real efficient monitoring. Improvements in the processes and data validation are thus required to enable reducing the administrative burden and to improve the efficiency of the whole system. More digital inclusiveness allows re-use of (open) data and support farmers in more accurate and less burdensome claims. In many member states, digital inclusiveness might lead to a completely pre-populated application of income support, and to an even more advanced ‘Click-and-Pay’ seamless claim.
The project NIVA starts from the premise that innovative new developments of IACS responding to new digital trends can lead to a more sustainable agricultural production across Member States and can assist in a reduction of the administrative burden to actors and stakeholders. This involves three main challenges:
1. Absorbing innovations to simplify the governance;
2. Reducing socio-economic and administrative burden to farmers;
3. Reducing the gap between IACS data use and potential broader uses.
These three specific challenges address different actors as worked out below. These are also flowing towards the objectives of this project that clearly target the needs and opportunities the project addresses.
ABSORBING INNOVATIONS TO SIMPLIFY THE GOVERNANCE
The IACS forms the core of the governance infrastructure of the EU’s Common Agricultural Policy (CAP). At the same time, trends in digitalisation of agricultural businesses and administration, availability of digital data and their wide acceptability in the agricultural industry as well as the need for more evidence-based policy evaluation put new demands on the current IACS. Absorbing these innovations can improve the governance: more transparent, exhaustive => fairer, likely decreasing disputes and being less contentious between EU and MS.
A key element for a new effective model of targeted CAP payments is a sound and transparent monitoring system, which is built on reliable and robust environmental indicators, also responding to the requirements of the new CAP as highlighted in Box 1 below. Recent advancements in satellite Remote Sensing and in particular in the European Earth Observation programme Copernicus improve the options for continuous monitoring of these indicators. In 2014-2015 the Copernicus programme entered into operation. The spatial resolution, specific sensors, EU-wide coverage and average revisit of 5 days of the satellite data in Copernicus can be particularly useful for farm and field-level monitoring of crops and land use. Thanks to the availability of this data and to increasingly available further sources from precision agriculture technologies combined with new methodologies to cross-link farmers information, NIVA will enable the EC-suggested shift from the traditional control of farmers’ claims based on sampling, to a continuous and full monitoring that checks compliance to requirements when they can be verified, enabling a reduction of follow-up actions. This change will ease the administrative demands in the relationships within the sector, especially between payment agencies and farmers.
REDUCE SOCIO-ECONOMIC AND ADMINISTRATIVE BURDEN TO FARMERS
According to the Guidelines for Better Regulation, administrative burden is a component within the wider term of compliance cost, one which covers “those costs incurred by the relevant parties (businesses, citizens etc.) to comply with any new legislative requirement, their sub-components (administrative burdens, labour costs; equipment costs etc.) and the administration and enforcement costs incurred by the responsible authorities”3. The term ‘administrative costs’ is further defined in the Better Regulation Toolbox, where “Administrative costs are defined as the costs borne by businesses, citizens, civil society organisations and public authorities as a result of administrative activities performed to comply with information obligations included in legal rules”4. Within this project we take up the challenge to reduce the burden of farmers to comply with CAP regulations. A feasible way forward is the ambition for what is commonly called the “Seamless Claim”: by properly combining several datasets and using innovative techniques, it seamlessly provides farmers with advisory and validated payments thus reducing, if not eliminating, sanctions. As an intermediate step, a less ambitious pre-populated application will also be piloted. Several digital and process innovations of this project will serve the seamless claim demonstrating and measuring the reduction of the administrative burden.
POTENTIAL BROADER USE OF IACS DATA
The IACS system is used to govern the CAP direct payments and is a valuable source of information. However, its current usage is limited due to a) a range of diverse implementations across Member States, and b) the lack of agro-environment data. Therefore, the impact of the agricultural activities on the environment is not sufficiently measured in the current IACS and can hardly be reflected in evaluations of the CAP.
Harmonized EU-wide accessible IACS data and standardised data flows, in combination with indicators for monitoring of environmental and climate performance would benefit the involved actors and stakeholders and have huge potential to foster realisation of environmental and climate ambitions of the EU. Through interaction with relevant stakeholders, including NGOs, EC, farmers organisations and other, NIVA will contribute to a monitoring system, achieving pan-European data interoperability (and harmonisation) and accessibility, perfectly fit to investigate the relationships between the defined policy measures and the farming practices in order to ensure the delivery of environmental public goods. Realisation of such continuous monitoring requires:
the development of simple measuring and accountability tools that can be used for environmental policy objectives concerning water, biodiversity, soil, climate and landscape for dairy and arable farming.
Box: The New CAP concepts
|On 1 June 2018, the European Commission presented legislative proposals on the common agricultural policy (CAP) beyond 2020. These proposals aim to make the CAP more responsive to current and future challenges such as climatechange or generational renewal, while continuing to support European farmers for a sustainable and competitive agricultural sector. To ensure stability and predictability, income support will remain an essential part of the CAP. Part of this, basic payments will continue to be based on the farm’s size in hectares. However, the future CAP wants to prioritize small and medium-sized farms and encourage young farmers to join the profession. Farmers play a key role in tackling climate change, protecting the environment and preserving landscapes and biodiversity. In its proposal, the European Commission sets high ambitions on environmental and climate change.
To do this the European Commission proposes a more flexible system, simplifying and modernizing the way the CAP works. The policy will shift the emphasis from compliance and rules towards results and performance. A new way of working is proposed.
The current CAP delivery system relies on detailed requirements at EU level, and features tight controls, penalties and audit arrangements. These rules are often very prescriptive, down to farm level. In the Union's highly diversified farming and climatic environment, however, neither top down nor one-size-fits-all approaches are suitable to delivering the desired results and EU added value. In the delivery model in this proposal for the new CAP, the Union sets the basic policy parameters (objectives of the CAP, broad types of intervention, basic requirements), while Member States bear greater responsibility and are more accountable as to how they meet the objectives and achieve agreed targets.
Greater subsidiarity will make it possible to better consider local conditions and needs, against such objectives and targets. Member States will be in charge of tailoring CAP interventions to maximize their contribution to EU objectives.
A shift towards a more performance-oriented policy requires the establishment of a solid performance framework that, based on a set of common indicators, will allow the Commission to assess and monitor the performance of the policy. A new Performance Monitoring and Evaluation Framework (PMEF) will cover all instruments of the future CAP: the CAP Strategic Plans as well as those elements of the CAP not covered by the CAP Strategic Plans (some parts of the Common Markets Organization, specific schemes). Performance would be measured in relation to the Specific Objectives of the policy by using a set of common indicators.
An annual performance review is foreseen as the key element of the ongoing monitoring and steering of policy implementation. In order to make an annual performance review operational, adequate output indicators and result indicators will have to be submitted jointly in an annual report on the implementation of the CAP Strategic Plan, the so-called Annual Performance Report.
The current governance structures will be maintained– that must continue to ensure an effective monitoring and enforcement. In order to advance towards a more result-driven policy mechanism, there will be a shift from assurance on legality and regularity of the underlying transactions to assurance on performance and the respect of EU basic requirements, like the Integrated Administration and Control System (IACS) or the governance bodies (paying agencies, coordinating bodies, competent authorities and certification bodies). The robust and reliable governance structures which characterize the CAP will be maintained.
This project will take into account this new way of working. It is a step forward in working together in the EU acknowledging the diversity between and within the different Member States on the basis of the same kind of governance structures and with common indicators. We still face the same challenges to make progress for a more effective and efficient implementation of the CAP especially the use of available data and to realize the improvements of IACS as mentioned in this proposal.
The monitoring system to be developed within NIVA will make use of remotely sensed, farm-level and field-level data. The resulting database with a sophisticated level of interoperability and accessibility can be used to obtain the agricultural, environmental and social indicators to support CAP governance may also be used for the construction of a publicly available statistics database where researchers can select and down-load valuable information about the historical distribution of, for example, forest land or permanent grassland.
Furthermore, the Land Parcel Identification System (LPIS) as part of IACS is a valuable resource and reference layer as it contains all (eligible) agricultural land. It helps the interpretation of satellite data and other relevant resources. Sharing a harmonised LPIS is a great wish from many stakeholders.
The overall objective of this project is therefore as follows: NIVA aims to modernise IACS by making efficient use of digital solutions and e-tools, by creating reliable methodologies and harmonised data sets for monitoring agricultural performance while reducing administrative burden for farmers, paying agencies and other stakeholders.
This overall objective is made operational in the specific objectives:
1. Integrate and reuse IACS evolutions based on open standards and common services
Re-engineering of current IACS systems is required in order to meet modern insights in digitisation of governance and e-Government. Following up the review of the requirements, NIVA will deliver tools, services, methodologies and standards (such as EO classification algorithms, auxiliary data as monitoring proofing tools, automated LPIS update, indexes etc.) that can be implemented in the participating Member States (MS), and later could also be taken-up by systems of other stakeholders (including IACS’s of another MS). The project will provide a true and open community platform for sharing solutions in the IACS domain. In addition to the platform, NIVA will develop technical solutions to aid local IACS implementations and ensure their long-term sustainability and go-to-market actions aimed to foster industry partners to further develop and grow the solutions above and beyond this project. The project will develop a reference IACS architecture and common libraries of reusable processes, digital components and reference configurations by using open standards and open source, to facilitate the effective adoption in existing IACS implementations.
2. Build on farmers’ acceptance of the Smart Monitoring methodology
The new policy framework provides an opportunity to replace the current on-the-spot checks (OTSC) by a novel monitoring concept. The Smart Monitoring [IT1] methodology responds to the proposed new delivery model of governing the CAP by replacing the OTSC guidance by a data-driven monitoring of risks. The monitoring approach sets up a procedure of regular and systematic observation, tracking and assessment of all eligibility criteria, commitments and other obligations which are monitorable by nature, over a period of time that allows to conclude on the eligibility for the aid or support requested. This will lead to the so-called traffic-lights approach: green for clear compliance, red for clear non-compliance and yellow for inconclusive results. In addition to Remote Sensing, other independent data sources can be used in the Smart Monitoring. NIVA will ensure that appropriate and relevant data are collected at the source become a reliable additional input for subsequent processes of payment and performance monitoring. During the project relevant options will be piloted to ensure farmers’ acceptance of this new arrangement, passing from the current ‘declare, control and pay’ paradigm to a new ‘monitor, confirm and pay’ approach.
3. Reduce the gap between current use and potential broader use of IACS data.
The 2017 Paris agreements, the sustainable development goals and the EU’s climate policy pose a clear target on agriculture. Of all available data sources, farm level data collected under the CAP (e.g. via the IACS system) is an important resource to be used by Member States for their greenhouse gas emission and land use change reporting and accounting. The several CAP implementations across member states contain important amounts of detailed and valuable data. IACS and the Land Parcel Information System (LPIS), which are critical CAP data sources, provide fine-grained land use data, annually updated, but the potential of this resource for climate reporting is vastly underused. NIVA will bring solutions to overcome the main drawbacks of using IACS data: Privacy (data need to be anonymized or specific agreements for data sharing must be made) and Harmonisation (currently the IACS would need improvement for an extensive cross-border interoperability). It will also open the possibility to pilot performance-based payments schemes incentivising farmers contributing to the development of public goods. NIVA will clearly promote extensive data and information flows between Member States, the European Commission and various other stakeholders.
4. Create a permanent exchange platform for discussion and exchange
Advancing e-Government strategies is besides a technical challenge also social challenge in how new co-creation models and stakeholder involvement are organised. The Large-Scale Pilot to be realised in NIVA offers an opportunity to all stakeholders to discuss and exchange ideas, proven concepts and success stories. The Innovation Ecosystem will speed up innovations by early discovery and address of adoption barriers, legal, social and ethical issues and other non-technical aspects. This exchange platform paves the way for inclusive social aspects related to technology introduction and innovation and will establish a new mainstream in open collaborative advancement of the state of the art in CAP governance instruments. Not restricted to the partners in the consortium, this innovation ecosystem will bring together all the actors active and relevant in the digitisation of both the agricultural sector and the (e-)government.
Project Total cost:
10 534 935 Eur
Total EU contribution:
9 999 946,5 Eur
Duration of the project:
2019 – 2021 (36 months)