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Common Agricultural Policy Reform: Statements (Continued)

Thursday, 14 March 2013

Dáil Éireann Debate
Vol. 796 No. 3

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(Speaker Continuing)

[Deputy Éamon Ó Cuív: Information on Éamon Ó Cuív Zoom on Éamon Ó Cuív] I am suggesting four categories of land quality: non-designated land, less favoured areas, severely disadvantaged areas and mountain land. Much more accurate data will be available for these purposes after the areas of natural constraints survey has been completed. I am proposing that livestock farmers not be able to drawn down payments without meeting the minimum stocking requirement that would apply in each of these four categories. This approach does not link the payment to production - it links it with a minimum requirement already in place under the disadvantaged areas scheme. The mistake made under that scheme was that the lowest common denominator was used. I am suggesting that only in the event of an ecological order from the State would farmers be exempt from having to achieve these basic minimum standards.

I would speak about many other aspects of this matter if more time was available to me. I have not even referred to Pillar 2. We need to discuss this process as it continues. I might disagree fundamentally with the Minister on philosophical issues, but I accept that he is amenable to debate. I hope we can have detailed ongoing dialogue on this issue at the Joint Committee on Agriculture, Food and the Marine. We should thrash it out as each step is taken. That is necessary if Oireachtas Éireann is to have a real input into the development of the Common Agricultural Policy.

Deputy Martin Ferris: Information on Martin Ferris Zoom on Martin Ferris I would like to share time with Deputy Michael Colreavy.

Acting Chairman (Deputy Joe O'Reilly): Information on Joe O'Reilly Zoom on Joe O'Reilly Is that agreed? Agreed.

Deputy Martin Ferris: Information on Martin Ferris Zoom on Martin Ferris I thank the Minister for attending today's debate and wish him well in the ongoing negotiations. The proposals for the reform of the farm payments scheme have excited huge debate within the farming community. It is possible that the debate has highlighted for the first time the fact that the community does not share a common view on all issues. I have attended a number of meetings on the issue and was part of a delegation of Sinn Féin members and farming representatives that travelled to Brussels last week. We discussed the proposals and the likely outcome of the negotiations with members of Commissioner Cioloş's team.

  On Tuesday night I attended a large meeting of farmers from south-west Munster at the Devon Inn. It was apparent at the meeting, as it has been at othes I have attended with farmers and members of various farming organisations, that the perception in some quarters that there was widespread hostility to the proposals to redistribute funds was by no means a reflection of the position on the ground. It is apparent that many farmers are unhappy at the lack of debate on the proposals. There is a perception that the debate has not been conducted with all of the relevant facts on the table. Many farmers believe the distribution of Common Agricultural Policy moneys has been unfair and unequal.

  There appears to be an insinuation in certain quarters that some smaller operators are not really entitled to payments at all. The use of a code, involving the use of terms such as "active" or "productive" farmers, on the one hand, and "unproductive" and "inactive" farmers, on the other, is rightly seen as an insult by many smaller producers who have to supplement their low incomes by seeking part-time off-farm employment or availing of the farm assist scheme. The antipathy to a fair distribution of funding extends to many small to medium-sized full-time producers. I have it on good authority from a party member that a person who addressed the picket on the Minister’s office in Cork last weekend said the Minister should remember he was the Minister for agriculture rather than the Minister for social welfare. I doubt that we will see that argument used as a headline in the Irish Farmers' Journal. It sums up the attitude of a small minority of major beneficiaries of the single farm payment to thousands of other farmers whom they see as lesser farmers.

  I would like to mention a significant contradiction in this respect. Some of those objecting to allegedly unproductive farmers receiving a more equitable share of farm payments and thereby being allowed to improve their productivity have no problem in defending the large single farm payment cheques to certain big businesses. The last year for which we have individual breakdowns showing who received what under the single farm payment scheme and other Common Agricultural Policy schemes is 2008. The largest recipient of CAP funds in that year was Greencore which received €83 million in respect of the closure of the Irish sugar industry. This closure was facilitated by the then Minister, Mary Coughlan of Fianna Fáil, and the leadership of the IFA. We know now that the closure did not need to take place.

  Of the top 20 recipients in 2008, 16 were agribusinesses that received over €20 million between them. Some 243 recipients are receiving more than €32 million between them, while a further 1,800 are receiving over €118 million between them. The total moneys received by these 2,250 individuals and companies are more than what is received by 50,000 farmers who receive single farm payments of less than €5,000. The average payment to the top recipients is over €73,000 per year. The average payment to the 50,000 farmers I have mentioned is just over €2,400. In other words, more money is paid to the top 2% of those who receive single farm payments than to the bottom 42%. It is beyond me how anyone can defend this or claim it promotes the best interests of Irish farming.

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney I am not defending it.

Deputy Martin Ferris: Information on Martin Ferris Zoom on Martin Ferris I know that and I am not saying the Minister is.

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney That is why we are proposing redistribution.

Deputy Martin Ferris: Information on Martin Ferris Zoom on Martin Ferris 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.


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