Direct coupled payments to suckler farmers look set to be rejected in favour of a productivity-based scheme aimed at rewarding quality, the Minister for Agriculture, Simon Coveney, has revealed.
Minister Coveney told the Agricultural Science Association (ASA) conference that he would prefer to transfer funds from Pillar I to Pillar II to tailor a scheme to give farmers a payment for productivity.
“Coupled payments do not work in all situations. If a farmer does not have the capacity to increase his stocking rate, he cannot gain from a coupled payment,” he told the conference.
“Coupled payments have a use but we cannot support people for producing animals regardless of the quality of those animals.”
The Minister’s comments come as Teagasc research on the effect of the new CAP revealed that 40pc of the output from the cattle sector was at risk, with suckler farmers facing a significant income fall.
Teagasc director Dr Gerry Boyle told the 350 conference delegates that Teagasc was very anxious to defend the beef sector, but it would take a very significant transfer of funds to encourage farmers that might want to leave suckling to remain in the system under the new CAP regime.
However, he added that Teagasc analysis of Pillar I (direct payments) funding showed that only “very modest” coupled payments for vulnerable sectors of agriculture were possible without creating distortions within and outside the cattle sector.
Reacting to Dr Boyle’s comments, IFA president John Bryan warned that unless Minister Coveney took urgent action to protect the suckler industry, thousands of jobs would be lost in agriculture.
“The most startling thing said today is that 40 per cent of our beef production is at risk. The single biggest employer in agriculture is the beef industry. This would surely be a red light for any country or economy to hear,” he insisted.
“Unless the Minister does something urgently, we will wake up one day with the Food Harvest 2020 targets in the bin and after losing 30,000 or 40,000 jobs,” warned the IFA leader.
Paul Finnerty, chief executive of ABP Food Group, also called on the Department of Agriculture to support the national suckler herd “in a material way”.
Mr Finnerty claimed the multiplier effect of the beef industry would ensure that €100m invested in any initiative to support the suckler herd would return four or five times that amount to the national exchequer.
Decisions on any potential suckler payment are imminent, with Minister Coveney telling the conference he intended to make decisions on direct payment by the end of October and decisions on rural development by the end of November.
Referring to the national budget, Minister Coveney committed to providing enough national exchequer funding to draw down all funding from Brussels.
The majority of schemes eligible for Pillar II such as environmental schemes and grant aid for capital expenditure are based on 50:50 European Commission and State funding, with scope to increase the national funding element.
“We will make sufficient funds available to draw down all available EU funds and I would hope to be in a position to go way beyond the minimum co-funding requirements in the future but that will take time,” the Minister said.
Meanwhile, tax changes aimed at encouraging land mobility are expected to be included in the upcoming Budget 2014. Speaking to the Farming Independent, Minister Coveney said that while he could not give details, he intended to put together a package to incentivise long-term leases.
“Conacre thinking is a disaster, with farmers competing against each other each year. It’s just bad planning, with no long-term thought put into how best to use the land,” Minister Coveney maintained.
(Source – Irish Independent – Caitriona Murphy – Tuesday, 17 September 2013)
Minister for Agriculture Simon Coveney
Those With €150k Plus Income Will Have Farm Payments Capped
Farmers receiving over €150,000 a year from the EU in farm payments are likely to have the sums capped in future under a new deal negotiated between the European Parliament and member states.
Disputes between members of the parliament and the EU states had threatened to hold up a decision on the Common Agriculture Policy reforms, requiring them to go to a second reading in the parliament that could well drag on into next year.
Such a delay, if it extended into next month, would have also threatened payments to farmers, especially those in receipt of rural development funds, Agriculture Commissioner Dacian Ciolos warned this week.
At present 80% of CAP payments go to the top 20% of intensive farm businesses as some countries continue to link the subsidies to production levels, the Lithuanian presidency pointed out.
Under the revised CAP, each farmer will have to receive at least 60% of the average national subsidy per hectare — a figure designed to remove the advantage bigger, industrial farms have at present.
MEP Mairead McGuinness, negotiating on behalf of the parliament at last night’s talks, said the agreement allows EU states to limit payments to farmers with a basic payment in excess of €150,000.
“Last night the council accepted that limits to higher payments was necessary, and a reduction of a minimum of 5% on amounts over €150,000 is now part of the CAP agreement, with the possibility for member states to impose higher cuts, or to place a cap on the amount which any farmer can receive.”
The agreement will allow next Monday’s agriculture committee to vote on the reforms. They will vote also on a report allowing for transitional measures for CAP payments next year.
Ms McGuinness said in 2014 direct payments will be based on the current system, but it will be with the allocation as provided for in the budget agreement. “This involves a reduction in payments to farmers in receipt of payments over €2,000 in order to keep the CAP spend within the limits of the new budget figures. The cut is expected to be of the order of 4%.”
On co-financing rates for rural development, member states accepted the parliament’s request to increase the rate for less developed regions on a voluntary basis to 85% but not for Ireland.
One of the biggest changes is that 30% of farm payments will be spent on measures designed to make farming and food production more sustainable and environment friendly.
(Source – Irish Examiner – Ann Cahill – 25/09/2013)
Fine Gael MEP Mairead Mc Guinness