Mr. Aidan O'Driscoll:

Before I start, I wish to make a small correction to our six-monthly report. On page 4 of the report, in section 2.1, it says that Russia announced an extension of the ban by a further six months to the end of January 2016. That should say that the ban was extended by one year, to 6 August 2016. I apologise for that error.

Members have before them the six-monthly report on developments in the EU for the period from January to June 2015. The report outlines progress on EU agriculture issues under the Latvian Presidency, and I propose to provide the committee with an overview of the work carried out by the Department during this time.

Simplification of the Common Agricultural Policy was one of the main topics discussed during the first six months of the year, with Council conclusions agreed in May. The main thrust of the conclusions was to identify those areas of the CAP most in need of simplification and to put pressure on the Commission to come up with simplification initiatives to address these areas. The Commission progressed its simplification agenda by adopting two regulations: an implementing regulation which extended the date for applications under the basic payment scheme, and a delegated regulation which amended the rules for direct payments, allowing for more flexibility in the animal identification rules for coupled supports.

More recently, at the November meeting of the Council of Ministers for agriculture, Commissioner Hogan announced a package of measures to be addressed in the coming months. These included a reduction in the rate of on-the-spot inspections in certain circumstances, changes to the definitions of young farmers and active farmers and changes to the number of annual amendments allowed in respect of rural development programmes. The Commissioner also announced that a second package of modifications pertaining to greening was planned for mid-2016, with the relevant changes coming into effect from claim year 2017.

While we still await details of the proposed changes, we have generally welcomed the Commission’s initiative, as it deals with many of the issues we have consistently raised. We note the timeline proposed by the Commission to implement these measures, and have requested that this take place as soon as possible.

As regards amendments to the rural development programmes, we are of the view that the current provision for one amendment per year is too restrictive, and we have welcomed the Commissioner’s readiness to expand the number of possible amendments to three per year. At the November Council of Ministers, Ireland's Minister for Agriculture, Food and the Marine, Deputy Coveney, also called on the Commission to introduce a fast-track mechanism for member states to deal with minor amendments to their rural development programme measures, and we hope to see further progress in this area in the near future.

A number of member states have called for the simplification exercise to be extended to the CAP basic Acts. The Commission’s focus has been on simplifying the delegated and implementing Acts, but Commissioner Hogan has recently signalled an open mind on reviewing the basic Acts also.

Ireland has not sought a reopening of the basic Acts at such an early stage of the implementation process. We believe that much can be achieved from changes to the implementing and delegated Acts, together with a more reasonable and flexible approach from the Commission to its interpretation of the existing regulations. It is an issue on which we will continue to work with the Commission and other member states in the coming months.

The Latvian Presidency also continued to monitor market developments across the EU, including the effects of the Russian ban on the importation of EU agricultural products. Discussions in the first half of this year centred around the impact on the dairy sector, as well as the future of the EU sugar sector following the end of the quota regime in September 2017. In the dairy sector, attention initially focused on the abolition of milk quotas from 1 April and how member states, including Ireland, would manage the repayment of the super levy bill, amounting to over €71 million in Ireland. The Commission introduced an implementing regulation which enabled member states to facilitate a phased repayment of super levy liabilities in respect of the 2014-15 milk year over three separate annual instalments, without interest. The Department, following discussions with the relevant stakeholders, subsequently introduced the super levy instalment scheme. Under this scheme, the Department of Agriculture, Food and the Marine will raise a debt against the milk producer for the outstanding amount of the super levy bill, upon receipt of a formal application, and facilitate payment over three equal instalments. Some 3,700 producers have availed of this facility. That is just over half of those paying the super-levy.

More recently, however, the deteriorating market situation has dominated the agenda. As the committee will be aware, a number of member states, including Ireland, called on the Commission to introduce further market measures to assist farmers in difficulties in the dairy and pigmeat sectors in particular. In preparation for the extraordinary Council in September, Ireland put forward a six-point plan for consideration by the Commission. Our proposals included an increase in the advance payment payable under the basic payment scheme, strengthened market supports through an increase in intervention prices and enhanced private storage schemes for cheese and pigmeat, and additional promotional measures for the dairy and pigmeat sectors, especially on third country markets. In September, the Commission unveiled its €500 million aid package. This addressed the majority of our proposals - five out of the six. A sum of €13.73 million in direct aid was allocated to Ireland, with the possibility of a further national top-up of up to 100%. The committee heard about that earlier from the Minister under the Supplementary Estimate. The Minister has been consulting with stakeholders in the interim as to how these funds should be utilised and he hopes to be in a position to make an announcement in this regard shortly.

Our rural development programme, RDP, was finally adopted by the Commission in May following a series of intensive bilateral discussions with it. Prior to formal approval being granted, we received a letter of comfort from the Commission in April and this allowed us to progress with our plans to launch a number of measures contained in our rural development programme in line with the annual budgetary process. We have now launched measures worth up to €3.2 billion over the lifetime of the RDP, including the agri-environmental measures, areas of natural constraints, TAMS and, most recently, the organic farming scheme. As to the remainder of the €4 billion RDP fund, the ground work has been laid for commencement of our knowledge transfer schemes and these will start early in 2016, as will training for GLAS and beef genomics farmers. We will also make a start before the year end on animal health and welfare training for on-farm advisers, with the remainder to be rolled out in 2016. Next year will also see the launch of our locally-led schemes and our European innovation partnership, EIP, knowledge and productivity programmes.

On the international trade front, Ireland continues to support the Commission's efforts in progressing the trade agenda. As a trading country, we have a clear national interest in this area and we recognise the benefits for the agrifood sector, in particular, that can be derived from international trade negotiations. We favour a balanced approach, which acknowledges offensive interests as well as providing the means to deal effectively with defensive interests. As regards the main areas of activity, the World Trade Organisation, WTO, ministerial conference in Nairobi takes place next week. Attention here is focused on a potential mini-package incorporating agreement on export competition, support for least developed countries and transparency on rules. Ireland very much supports the EU position that any discussion relating to export competition should encompass all four pillars - export subsidies, export credits, food aid and state trading enterprises - and not just export subsidies. We look forward to progress being made in this area and we hope also for a consensus on the future direction of the Doha round post-Nairobi.

On the Transatlantic Trade and Investment Partnership, TTIP, we wish to see momentum being maintained in the negotiations. TTIP is of significant importance for Ireland and the EU. Again, we are taking a balanced approach, given that there are offensive interests, especially in dairy and also in beef, as well as defensive interests, especially in beef, to be progressed. We must also ensure, in light of the recent exchange of revised offers, that adequate attention is also paid to the dismantling of non-tariff barriers, which can often be of significant practical value.

I also wish to mention the prospect of a revival in the Mercosur negotiations, particularly following the recent election in Argentina. The point has been made many times that these negotiations have the potential to give rise to negative consequences for agriculture in the EU. They present a threat to the EU and to the Irish suckler beef sector in particular. We will, therefore, continue to exercise extreme caution, monitor developments very closely and consult our own Government colleagues, with other member states and with the European Commission, as to the appropriate response to any movement in the negotiations.

An area of particular importance for Ireland is the role of agriculture and forestry in the climate change debate. For Ireland, it is critically important that in the EU's climate and energy framework post-2020 we see recognition of the multiple objectives of the agriculture and land use sectors, with their lower mitigation potential, and the need to ensure coherence between the EU's food security and climate change objectives, as agreed in the European Council Conclusions of October 2014. In particular, securing recognition of the role that our forests play in carbon sequestration at EU level is critical. Both agriculture and land use, land use change and forestry, or LULUCF as it is known, should be included under the effort sharing decision which is expected next year. This would encourage positive actions such as afforestation across the EU, as well as encouraging a more coherent approach to agriculture and land use. The provisions relating to the accounting and reporting of emissions and removal of greenhouse gases from the agriculture and land use sector, including forestry, are of particular interest to Ireland as they have an important role to play in the transition to a safe, sustainable and low-carbon future. We strongly support an ambitious, legally-binding global agreement with broad participation as a core outcome of COP 21 in Paris, which will ensure that the EU's domestic transition to a low-carbon economy takes place in an agreed global context.

I will now turn to some of the legislative dossiers that were dealt with during the Latvian Presidency. Discussions on the organics proposal continued into 2015. The text of the proposal was revised substantially after it was re-examined at both political and technical level. The issues that caused the most difficulties for member states included how to deal with the presence of non-authorised substances in organic products, the frequency of controls - notably annual versus risk-based controls - and the import regime, whether it should be based on compliance or equivalence. The Latvian Presidency secured a general approach at the Council of Agriculture Ministers in June, with the first trilogue discussions taking place on 19 November. The Presidency is expected to provide an update on the progress of the organics dossier at the AGRIFISH Council next week and we look forward to hearing what it has to say.

Progress on the merging the school fruit and school milk schemes was suspended at the end of the Italian Presidency following disagreement between member states and the Commission on three key aspects of the proposal, namely, the legal basis, the scope and the allocation criteria. The Commission undertook to evaluate the two schemes as part of the CAP simplification exercise and recommended that all work on the proposals be suspended pending the outcome of its evaluation. Consequently, no discussions took place on this dossier at Council during the Latvian Presidency. The dossier has progressed under the current Luxembourg Presidency, with three trilogue discussions taking place, most recently on 1 December. The Presidency is keen to secure agreement on this proposal but the European Parliament continues to demand greater flexibility from the Council regarding the legal basis for a number of provisions in the regulations, including the total amount of aid allocated under the scheme, the criteria for the allocation of national envelopes and the transfer of allocations between schemes. The Council has moved some way towards the European Parliament position and we look forward to hearing from the Presidency on the latest developments in this area next week.

There was some progress made on the so-called five-part animal and plant health package. Compromise text on the animal health dossier was agreed at its first reading at trilogues with the European Parliament in June and is expected to be adopted in early 2016. The plant reproductive material proposal, intended to consolidate and update the current 12 separate directives governing the sector, was withdrawn by the Commission in March following its rejection by the European Parliament in 2014. The Commission is not expected to table an alternative proposal before 2016 at the earliest. Work is continuing on the plant health and official controls dossiers. The first element dealing with expenditure was agreed at the end of 2013.

I will conclude with a reference to the upcoming Agriculture and Fisheries Council, the final Council presided over by the Luxembourg Presidency before The Netherlands assumes the Presidency on 1 January. It is customary for each Presidency to take stock of developments over the previous six months and this has been reflected in the agenda. Of course, fisheries will dominate the agenda and the Minister, Deputy Coveney, has spoken to the committee about that. The remaining agenda items include progress reports and states of play on the various dossiers covered during the Luxembourg Presidency as well as information points from the Presidency.