Holistic Risk Management As a Response to Budgetary Constraints

The latest perspective of the Common Agricultural Policy (CAP) focuses in particular on risk management (RM) issues due to the need for aligning the CAP to the new agricultural operating conditions. The future of agricultural policy has become, as never before, increasingly climate-dependent and threatened by typical agricultural issues of concern, including strong dependence on weather conditions, price volatility, natural disasters or risk of new diseases that can potentially destabilise the farmers' income. Changing tendencies of the existing agricultural policy can also underlay the uncertainty of farm functioning. The on-going debate focuses on income stabilisation tools and shifting from the existing programmes oriented at direct payments and other agricultural support measures. Thus, reorientation of agricultural policy brings the risk of losing the existing support and the need for seeking the new income stabilisation tools. The CAP proposes a holistic approach to risk management and a set of instruments addressing the budgetary constraints. It is, therefore, appropriate to state that limiting budgetary support may contribute to development of a more comprehensive risk management system in agriculture