Mr. John Keane:

I am joined by the chairperson of our national agricultural affairs committee, Mr. Liam Hanrahan, and our CEO, Mr. Mick Curran. I thank committee members for the invitation to address them, and for their continued support. One of the overall objectives of CAP is achieving generational renewal and improving that statistic. The overall objective of the CAP as initially set out was to ensure food security across the EU for its long-term prosperity. Unfortunately, over many years reform after reform has changed the priorities of the CAP. It is now driven by environmental ambition and sustainability measures as opposed to ensuring support for farmers and for the production of food. Objective No. 7 around the succession of generational renewal as we have seen in the CAP reforms, and which Macra na Feirme has addressed this many times, referred to enhanced numbers of young people in active farming by the year 2027. The SWOT analysis of our own Department of Agriculture, Food and the Marine identified it as a big weakness, one of the major weaknesses for the sector as we move forward, yet the provision of support was chosen to be at the minimum level across the CAP funding at just 3% of pillar one payments. Similarly, Ireland, through the Department of Agriculture, Food and the Marine and the Minister, was the only EU member state not to select installation aid as one of the measures to support young farmers under the Common Agricultural Policy. From a young farmer's point of view the support and the objective from the EU Commission has been welcomed. However, the delivery of action on the ground in terms of meeting the minimum requirements by our own Department and by the Minister has been a huge disappointment for us. Urgent action is needed by all actors across all policy levels and we recognise the contribution of and the access to this committee in recent weeks to discuss the future of Irish agriculture. It is one of the major topics to be considered when discussing all policy matters.

I turn to the specifics relating to CAP, particularly the new actions around BPS, which will become basic income support for sustainability, BISS. Farmers we have spoken to are completely unaware of the impact that the reduction of 20% or 25% of their payments for eco schemes is going to have on their envelope when it hits their accounts in the early part of October 2023, whether due to convergence or setting aside. Communication is needed, first and foremost, to indicate to farmers where that is currently sitting. We recognise that the Department has attempted to make that available through its online portal, but the reality is that my advisers are currently filling out those applications for farmers.

Conditionality has already been raised, and we were before this committee a number of weeks ago regarding the EU nature restoration law. Good agricultural and environment condition 2, GAEC 2, raises two serious concerns for us in terms of the rewetting of peatlands, but also in terms of the implications it will have, not just for farmers on those peatlands but also farmers in surrounding areas. On eco schemes there has been a major missed opportunity for the Irish Government. When we benchmark across other EU member states, we see that many of them have multiples of the options we have in terms of eco schemes. Macra has called for eco schemes relating to herd management, soil fertility and hedgerow management, while also supporting the specifics of milk recording which will be a necessary measure to achieve objectives under the antimicrobial resistance instruments and policies being pursued at a European level. We also have huge concerns, which we raised previously, around the entitlements associated with eco schemes, particularly on leased lands. We find that we are now in a situation where farmers in long-term lease arrangements will be claiming entitlements and many of those arrangements have within them the requirement that those farmers have to pay back the entitlements to the landowner. With the current set-up under eco schemes, the farmer who is actively farming the land will have to take the measures to carry out eco schemes while also returning said payment to the original landowner. I do not think anybody in this committee or in the farming community at large would accept it is compatible to ask a farmer to carry out an action that is causing significant income loss, while also returning an EU level payment to a landowner. When this question was raised previously with the Department it was relayed back to us that this is contract related within the lease agreements. However, many farmers may find themselves in the situation next year of carrying out actions relating to lease agreements, for which they will be getting little reward. On the other side the landowners, who are expecting a certain envelope in their single farm payments or new BISS payments in October 2023, will find that they have 25% less than they have this year, because the farmer actively farming the land has not carried out the measure.

On the ACRES scheme the timeframe for delivery of applications into the portal is of huge concern. It is not achievable if we are going to complete 30,000 applications before the deadline. The figures from about seven or eight days ago have indicated that our numbers are approximately 4,000 completed applications, 11,000 applications in process and 15,000 applications awaiting processing. As stated by Mr. Rushe, there are an additional 27,000 applications of expressions of interest from farmers to meet that. The reality is we have 48,800 farmers who are exiting GLAS payments at the end of this year. A total of 20,000 of those will find themselves unable to access an ACRES scheme which has been highlighted, particularly by those in low income sectors, as a priority to ensure viability in the long term. That figure of 48,800 farmers is without any additional farmers applying for the new ACRES scheme.

Essentially what has been decided here is that no new farmers will have access to ACRES and at a time when we are speaking about diversification and other opportunities, not providing the opportunity for farmers to be supported in adopting these measures is simply not going to achieve those objectives. Also one of the criteria under the new ACRES, particularly in tranche 1, asks that farmers must have submitted the basic payment entitlement in the year 2021. Essentially what this does is eliminates any new entrant to farming from applying for the scheme for the subsequent 18 months. Farmers who started farming after 9 June 2021 - which is almost 18 months ago - will not be able to access tranche 1 tier 1 payments, or may not be able to access tranche 2 payments either, on which point clarity has been sought.

In terms of TAMS payments, we have consistently raised the ceilings. This includes the payment rates but also the percentage support that can be given to young farmers. The option had been to offer 80% grant aid support for young farmers, particularly given the cost of investment at the moment, and the decision was made by the Department and the Minister to provide the lowest level of funding in terms of ceiling support, at 60% for young farmers under the Common Agricultural Policy. In relation to TAMS more specifically, there has been no criteria laid out for future investment after 1 January 2023 with specifics around investments for farmers. Farmers find themselves without clear definitions of what equipment will be supported across each sector once TAMS-III or the on-farm investment scheme, as promised in the CAP strategic plan, CSP, is laid out.

Macra na Feirme also recognises that support for vulnerable sectors is something which is crucially important to ensuring the future sustainability of rural areas. At a recent meeting of this committee, its representatives outlined many support pathways that can be used for those sectors. The supports provided under the measures for sheep, suckler, and beef enterprises across the Common Agricultural Policy are not within fitting in ensuring those sectors are sustainable in the long term. Further supports targeted at those vulnerable sectors will be needed.

I will finish on a specific point on organics. As has been stated, the market for organics is something that needs to be developed if we are going to encourage farmers and facilitate a large transfer of productive land into producing organics. Macra na Feirme welcomes the ambition as set out under the organics proposal but in terms of market development, it sees, not just in milk markets but also in egg and beef markets, that the supply is actually increasing beyond the demand in certain parts of the Continent. In Ireland last year, the increase in supply in organic produce and beef was 2.9% while the demand grew by 2.5%. There is also an issue with organics in the scheme, particularly around lease land. It is currently stated that all leased land must remain for the duration of the scheme. Many farmers in the organics have come forward to Macra na Feirme to state that they are at risk of losing this leased land over the course of the next number of years when it is due for renewal. They are worried they will not be able to meet the competition that currently exists within the lease market to maintain that land; thus putting their payments under the organics scheme at risk as a result of not having the same land base, achieving the same stocking rate, or being able to carry out the same practices on farms.

Finally, we want to reiterate our acknowledgement of the support of this committee and we welcome any questions.