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Common Agricultural Policy Reform: Statements

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Common Agricultural Policy Reform: Statements

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Common Agricultural Policy Reform: Statements

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Deputy Martin Ferris

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Snippet Contents:

Others, however, are defending it.
There is a clear regional divide in the payment of moneys under the Common Agricultural Policy. This reflects the type of land being farmed, the size of the land parcel in question and the scale of production. Some 18% of farmers receive less than €2,000 per annum, one third of whom are currently not entitled to any payment. There are large discrepancies throughout the country. Less than 9% of farmers in County Kilkenny receive less than €2,000 per annum, whereas 32% of farmers in County Donegal are in that category. Some 42% of farmers receive less than €5,000, as I have mentioned. They stand to gain most significantly if a redistribution takes place. The equivalent figure is 65% in County Donegal, 62% in County Leitrim and 60% in County Mayo. By contrast, payments in excess of €75,000 were made to just three of the more than 3,000 farms in County Leitrim. In 21 of the 26 counties, the majority of farmers receive payments of less than €10,000.
The distribution of funds also reflects the fact that the historical reference payments date to years when subsidies were tied to production. Far from encouraging expansion and productivity, this permanent unbalanced distribution of funds inhibits it. It was recently proposed that changes in productivity should be taken into account in the new system. This was seen by some as an attempt to deflect criticism to those on lower payments and support a change in the payments system. However, the Department of Agriculture, Food and the Marine has issued figures which undermine that argument. In fact, there has been little change since the reference years. One of the objectives of the 2003 reform was to restrict expansion, based on pressure from the WTO. In other words, the current single farm payment is a negative or, at best, a neutral factor in farm productivity. Farm numbers have continued to decline in the past ten years, albeit at a lower rate than in the previous decade.
It is not correct to claim that those who receive sums at the upper end of the scale will be forced to curtail their operations if their payments are reduced. If there was a fairer means of distributing farm payments, many small or medium-sized producers at the lower end of the payments scale would be able to expand their production. This would provide them with a level of income security and allow them to expand, including into new areas of production. It is a curious world view that holds that the imposition of a cap of €50,000 on farm payments to any individual would act as a major market disincentive, whereas an increase in the average payment made to over 50,000 farmers from €2,400 to €8,000 would encourage them to do less. It is a flawed argument.
The likely outcomes of the various proposals, dating back to the original Cioloş flat-rate proposal, can be subjected to many statistically breakdowns. It has been suggested payments on the first proportion of hectares should be front-loaded. In the Irish case, that has to be looked at for the first 20 hectares. These proposals have divided the debate within the farming community between those who would gain and those who would lose out. There would be a substantial number of significant gainers at the lower end of the current payments and a small number of significant losers at the upper end. Over 67% of farmers receive single farm payments of less than €10,000. It is not true to claim, as some have, that most farmers would lose out badly under any model which moves towards front-loading of up to €400 per hectare, or a similar figure. With a reduction in the larger payments, a further tranche of funds would be available to pay an extra amount on land above 20 hectares and, of course, there would be Pillar 2 funds. The question of how many would gain and lose in the reform of the payments scheme needs to be honestly debated, even at this late stage.