Policy review report: Optimising land use to mitigate climate change in Finland (31.12.2015)

 Appendix 1 (31.12.2016)

The aim of this policy review report was to gain an understanding on potential policy related obstacles and benefits and possible synergies with respect to the targets of OPAL-Life project, aiming at increased agricultural productivity and simultaneous greenhouse gas emission reduction from agriculture considering the existing policies, most notably the Common Agricultural Policy.

The review shows that the current system of financial support under CAP has many synergies with sustainable intensification and extensification, both of which are the corner stones of OPAL-Life toolkit. Possible obstacles for sustainable intensification also exist, and the most notable of them are connected with fertilization. The Nitrate Directive, binding all farmers in the similar way in the entire country regardless of location and its environmental vulnerability, is the top policy instrument guiding the levels of nutrition allowed. The agri-environment (A-E) scheme also restricts the use of fertilization for the farmers, who have made the agri-environment commitment. A-E scheme incentivises, through a risk free payment, farmers to limit fertiliser use under certain limits. A-E scheme also provides useful voluntary measures, such as more accurate use of nutrients, and various measures to extensify land use. However, A-E scheme, as well as the decoupled area payment, is likely to incentivise many farmers to extensive production, especially in the context of low market price prospects and increased volatility of input and output prices in agriculture which increase farmers’ risks of agricultural investments or increased use of inputs.

Afforestation, in the other hand, is not enjoying the same financial support as the agricultural sector does. One of the interesting tasks during OPAL-Life will be to have a dialogue with the farmers on the incentives for afforestation.

There are also some conflicting policies in place with respect to SI and OPAL-Life targets, and policy coherence can be regarded as the first step towards effective implementation of mitigation measures across sectoral boundaries.

The obstacles are summarised in table 1 below. They have been analysed by their magnitude and permanence to see how significant each obstacle is in connection to OPAL-Life project targets and how easy the policy in question is to change. Also some concluding remarks have been inserted into the table.

The summary shows, that there are no policies that could be considered as a high obstacle for the implementation of the OPAL-Life project in the entire country, and that would prevent the large-scale use of ideas presented in connection to sustainable intensification. However, there are some policy conflicts, at least related to decoupled area payments and implied land prices, and A-E scheme, which can be termed as low or medium level obstacles to SI and Opal-Life targets. It is worth noting, that the policies marked to medium category for magnitude, are exactly the policies that the OPAL-Life project results will hope to help develop in the long term.

Table 1. Policy obstacles summarized.

Policy obstacle Magnitude Permanence Conclusion
Support based on payment entitlements and decoupling from production – – – – – – These tend to favor extensification and ”hobby” farming in the expense of aiming at good yields. These are basic principles of the current CAP, but they can be changed as any policy.
Restrictions for fertilization – Nitrate Directive – – – – – – Restriction for fertilization are strict and might result to lower fertilization use that good yields require. Nitrate Directive is an European law, but it can be altered if there is political will.
Restrictions for fertilization – CAP agri-environment payments – – – – – – Restriction for fertilization are strict and might result to lower fertilization use that good yields require. CAP argi-environment payment fertilization levels are EU policy, but they can be altered if there is political will.
Separation of agricultural and forestry policy – – Afforestation is not the only tool for extensification. Change requires national scale political will.
No support system for afforestation of agricultural land – – Direct financial support is not the only incentive for afforestation. The costs can be deducted in taxasion and forest offers revenues in the long run. National policies are also easier to change that EU policies if needed.
Taxation – – Afforestation is not the only tool for extensification. Farmers have possibilities for predesicion in generation change situations. National tax laws can be changed as any other laws.
Availability of agricultural land – – – – – Availability of land poses obstacles, but sustainable intensification of the land resources available can be seen as a solution to this.
Intensity of production – – – – – Change of policy guiding towards more sustainable use of land.
Collision of policy – – – – – – Streamlining policies and a common understanding of the different aspects of concerns in question. One of the main aims of the OPAL-Life project.
Very low
– – Low
– – – Medium
– – – – High
Magnitude = how big of an obstacle the policy presents to the OPAL-Life project goals
Permanence = How permanent the policy is; is it easy to change