Von der Leyen shifts farm subsidy fights to national capitals in post-2027 budget plan

The European Commission has decided that the surest way to keep tractors out of the EU quarter is to make national governments responsible for the decisions that provoke them. A leaked blueprint of the post-2027 Common Agricultural Policy, obtained by POLITICO, shows that Commission President Ursula von der Leyen intends to fold the CAP into a broader national funding envelope alongside cohesion and regional funds. The CAP will formally survive, but the political fights over who gets paid, how much, and for what will move from Brussels to 27 national capitals.

The Commission's new approach to farm funding

The Common Agricultural Policy has been one of the EU's largest single budget lines since the 1960s, directing close to €400 billion every seven years into farms and rural communities. Under the draft proposal, that distinct budget line disappears. Agriculture Commissioner Christophe Hansen fought inside the Berlaymont to protect direct payments and secure a larger allocation for young farmers, and those red lines appear in the text. But the overall size of the pot is still undecided, and early estimates suggest a contraction of 15 to 25 percent compared with the current multiannual financial framework.

The Commission frames the merger as simplification. One EU diplomat described it more bluntly: "What a mess." The reform is part of von der Leyen's broader rewrite of the EU's seven-year spending strategy, which must cover defence, competitiveness, green transition and migration pressures with a budget that has barely grown in nominal terms since the Covid-era borrowing programme. Making the CAP do more with less is the arithmetic at the heart of the proposal.

How the CAP would change under the proposal

From 2028, national agriculture ministers will define who qualifies as an "active farmer" and how to target income support under tighter criteria. The draft suggests prioritising small farms, young farmers, women in agriculture and producers in mountainous regions, but it stops short of imposing binding EU-wide rules. The more land a farmer works, the less EU money they would receive per hectare. Subsidies for large landowners would be capped at €100,000, a long-standing idea that farm lobbies have blocked for years. Enforcement of that cap becomes a national responsibility.

The leaked text also nods to newer objectives: green technology, defence readiness and competitiveness. That wording gives finance ministries a route to redirect agricultural money toward other priorities once it sits inside a single national envelope. Farmers' organisations argue that the moment farm funding loses its ring-fence, it becomes the easiest line item to cut when budgets tighten.

National capitals face the political fallout

For agriculture ministers, the reform is a domestic hot potato. Portuguese Agriculture Minister José Manuel Fernandes told reporters during a meeting of EU farm ministers in Brussels that the CAP "works well and is essential for Europe's strategic autonomy. We must not destroy what works." He warned that lumping farm and regional funds together risks turning CAP money into a free-for-all. His concern is shared across southern and central European capitals where farming sectors are politically powerful and dependent on direct payments.

The Commission maintains that core farm funding is protected and that Hansen's internal rebellion ensured the income support system will not disappear. But the shift of implementation to national level creates a plethora of differently funded farming systems across the bloc. A farmer in Poland could face eligibility rules and payment rates that bear no resemblance to those applied to a neighbour across the border in Germany. The single market in agricultural support, imperfect as it was, would fracture further.

Budget cuts and the fight for shrinking resources

The 15 to 25 percent reduction estimate is the figure that concentrates minds in every ministry of agriculture. The current CAP budget for the 2021-27 period stands at roughly €387 billion in current prices, split between direct payments (the first pillar) and rural development (the second pillar). A 25 percent cut would remove nearly €100 billion from the seven-year total. Even a 15 percent reduction implies €58 billion less. The Commission's language of "efficiency", "flexibility" and "targeting" is the bureaucratic translation of those numbers.

Finance ministries in Berlin, Paris, Rome and Madrid have long argued that the CAP is overdue for modernisation and that direct payments disproportionately benefit large landowners. The €100,000 cap answers that critique. But the same finance ministries will now control the national envelope into which farm money flows. The risk, from a farming perspective, is that the cap becomes the ceiling and the floor simultaneously: large farms lose, small farms gain only if national governments choose to top up the envelope from their own revenues.

Farmer and ministerial resistance

Luc Vernet of the industry group Farm Europe called the plan "unacceptable for the farming community" and said farmers would receive "a slap in the face instead of a message of support." He added that the proposal is "completely disconnected from the reality of what is agriculture in Europe." That language signals the start of a coordinated lobbying campaign. Farmers plan to bring tractors back to Brussels on Wednesday, the day the Commission officially unveils its budget reform package. The last major tractor protests, in early 2024, forced the Commission to water down several green conditions attached to CAP payments.

Ministers are also mobilising. Fernandes's intervention in Brussels was not isolated. Agriculture ministers from France, Spain, Ireland and Poland have all signalled in recent weeks that they will defend the CAP's separate budget line. The Council of the European Union, where national governments negotiate, will be the arena where the Commission's proposal is either reshaped or dismantled. The European Parliament's agriculture committee, traditionally a stronghold of CAP defenders, will amplify those demands.

The negotiation timeline ahead

Wednesday's unveiling is the opening move in a process that will run for years. The Commission's proposal must be negotiated with the European Parliament and the Council under the ordinary legislative procedure. The multiannual financial framework for 2028-34 requires unanimity in the Council and Parliament's consent. That gives every national government a veto and every parliamentary group leverage. The last MFF negotiation, for the 2021-27 period, took more than two years and required a special European Council summit to resolve. The addition of defence spending and Ukraine reconstruction to the 2028-34 agenda makes a swift agreement even less likely.

In the meantime, the current CAP runs until the end of 2027. Transitional rules will be needed if the new framework is not ready, as happened in 2020 when the 2021-27 package was delayed. The Commission will argue that its proposal preserves the CAP's essence while adapting it to a new fiscal reality. National capitals will argue that the essence is precisely what is being lost. Farmers will argue that they are being asked to produce more food, more sustainably, with less money and more bureaucracy. The tractors arriving in Brussels on Wednesday are the first visible sign of that argument.