Phil Hogan: the smiling enforcer who brought stability to the CAP
The outgoing Commissioner will not rank as one of the great CAP reformers, but his no-nonsense approach brought reassurance to the agri-food sector during a period of turmoil
Friday October 31, 2019, will mark not only the last day (probably) of the UK’s membership of the European Union, but also the last day of Phil Hogan’s term of office as EU Commissioner for agriculture and rural development.
The Irishman, who stands almost two metres high, has towered over most of the thousands of people with whom he has shaken hands over the past five years – and he has been an equally imposing presence on the agricultural policy landscape over the same period.
His tough, no-nonsense approach has provided some measure of welcome stability for the agrifood sector in a period of general turmoil during which Hogan has faced a series of internal and, increasingly, external challenges to the European agriculture sector.
Posterity will not rank Hogan as one of the great reforming Commissioners. This is partly an accident of timing, given that European agriculture Commissioners have five-year terms of office in which to oversee a policy which runs on a seven-year cycle, and only luck decides how the two processes interconnect.
Some of Hogan’s predecessors have been in the right place at the right time to design and force through changes in policy which have fundamentally changed the policy direction of the CAP, and which have borne the name of their progenitor. Hence the textbooks will recall the MacSharry reform of 1992, the Fischler reform of 2003 (both very positive steps for European farm policy), and the Ciolos reform of 2013 (a rather more retrograde development).
Hogan will not have his name associated with any big policy change. It is his fate to be the architect of a package of CAP policy changes which another man will pilot through to adoption (subject to Parliamentary approval, this will be Poland’s Janusz Wojciechowski).
Yet the current round of measures to re-shape the CAP in 2021-27 are, in any case, less than radical. Those who had been hoping for a transformational new way of channelling support to Europe’s rural communities – a decisive shift towards environmental or wildlife protection, for example, or a re-imagining of the basis for supporting farmers’ incomes – were always going to be disappointed by the final outcome.
Breaking down walls between the CAP’s Pillars
Instead, the main emphasis of Hogan’s proposals has been to attempt to rectify the strategic incoherence which he inherited from the Ciolos package when he took over in Brussels in November 2014.
This he is attempting to do by means of the controversial CAP ‘Strategic Plans’ which are at the heart of the proposed new policy deal.
The Commissioner has understood that the institutional walls which the CAP erects between its Pillar One and Pillar Two are becoming increasingly flimsy – member states already have the flexibility to reallocate their budget funding quite liberally between the two – and that it therefore makes sense for each member state to take both into account in drawing up their national policy implementation priorities for the next seven-year financing period.
The challenge of how exactly this can be done without pushing the CAP ever further in the direction of renationalisation will be one for Hogan’s successor to pick up.
The outgoing Commissioner has also understood that environmental and (especially) climate issues will be among the biggest challenges for agriculture in Europe over the next 10 years or so, and he has accordingly placed more emphasis in these areas than in previous iterations of the CAP, notably with the eye-catching requirement that at least 40% of member states’ CAP spending contributes to “climate change objectives”.
In reality, however, the detail of the package has left environmentalists dissatisfied – and, almost inevitably, member states are now lining up to weaken the impact of the measures in favour of ones which are less economically and administratively onerous for farmers.
Simplification and protection
Prior to the launch of the current CAP reform process in June last year, Hogan’s main achievements in the area of domestic policy were to push through a programme of policy simplification, and to ride the storm of the 2015-17 collapse in milk prices.
National governments are perennially pressurising the Commission to ”simplify” the CAP – even if the policy compromises that they ultimately concoct usually mean that the opposite happens – and on his appointment Hogan was given a strong political mandate to include the CAP in the EU’s push for “better regulation”.
The Commissioner took aim at unpopular and unwieldy measures like the implementation of ecological focus areas which applied as part of farmers’ Greening requirements, and his success in achieving these limited objectives established his credentials as an operator who gets things done.
He was also unafraid to open up the EU’s intervention buying programme when skimmed milk powder prices went through the floor following the abolition of milk quotas. The 380,000 tonne stockpile which subsequently accumulated in EU stores was something of an albatross around the EU’s institutional neck for quite some time, but the Commission held its nerve, and in June this year it was finally able to sell the last tonne back to the market as prices recovered – to Hogan’s obvious satisfaction.
Russia, Brexit and FTAs
But external relations have dominated Hogan’s reign at DG AGRI. He took office in the aftermath of Russia’s shock 2014 embargo on EU agrifood products, and his support for the dairy, fruit and other farmers most directly affected won him plaudits – as did his skill in extracting the necessary funding from the EU’s budget managers.
Brexit has also cast its shadow. As Ireland’s representative on the Commission executive, Hogan has been outspoken about the disruption which the UK’s departure from the EU will cause, and he has frequently been scathing about the UK government’s handling of the process.
This could make life interesting in his future role as trade Commissioner in the new von der Leyen Commission, given that Hogan is likely to be primarily responsible for negotiating a future free trade agreement with the UK.
The Irish farmers whom Hogan once represented as national minister of agriculture have cause to be grateful to the Commissioner for agreeing to a €100 million bail-out fund to support Irish beef farmers who stand to lose access to the UK as a result of Brexit.
But Hogan’s tenure has perhaps been defined by the conclusion of new international free trade agreements (FTAs) which have set him on the path leading to his imminent assumption of the trade Commissioner role from Cecilia Malmström.
Hogan has had the good political fortune to have overseen EU FTAs which by and large have benefited EU agri-food interests more than they have harmed them. The deals with Canada, Mexico and Japan have all created new openings for EU exporters of high-value products like cheese, wine and pigmeat.
The Commissioner has also been clever in exploiting the current unreliability of the US as a trade partner to extract beneficial deals with the other two NAFTA partners, and with a Japanese government seeking to stabilise its trade relationships following the US’s withdrawal from the fledgling Trans-Pacific Partnership agreement in 2016.
It will now be down to Hogan’s successor to manage the market impact of the EU’s most recently-concluded FTA – with the Mercosur bloc. This time, the commercial gains for Europe do not conspicuously outweigh the political challenges of improved market access for the highly competitive South American exporters.
The EU farm sector must also face up to the fast-approaching conclusion of ongoing FTA negotiations with Australia and New Zealand, while the new Commission must also handle the tricky issue of palm oil imports, and the annoyance of Malaysia and Indonesia over the EU’s growing disenchantment with palm oil as a feedstock for biodiesel. All of these issues will be high up on the to-do list for Hogan as he moves to his new job – the first person to graduate from agriculture to trade Commissioner since Frans Andriessen in 1988.
A tough but personable negotiator, with acute political antennae, Hogan has done well to bring a measure of stability to the European agri-political scene, and ensure the political sustainability of the CAP for at least the next seven years. It is not a bad legacy to leave behind.