Ms Sharon Murphy:

I thank the committee and the Chair for the invitation to speak today regarding the recent Commission proposal to amend the legislation covering the CAP strategic plan, or the simplification proposal as it is called. I am assistant secretary with responsibility for EU and international affairs. My colleague, Ms Corina Roe is principal office for CAP strategic plan division and Mr. Michael Moloney is senior inspector from our integrated controls division.

I will go back to set the context. The CAP strategic plan is a five-year programme covering the period 2023 to 2027. It includes both direct payments and rural development measures. Ireland’s plan has a budget of €9.8 billion over this period. Of this, approximately €1.8 billion has been paid out to date. That equates to an average payment of approximately €15,000 per farmer but of course individual payments vary. Payments for the first year of the CSP are ongoing and cases are cleared weekly. However, there is no doubt that this first year of the current CAP has been challenging for farmers and the Department alike. The extent and the pace of change involved has been significant. It has presented a challenge for all concerned. The current CAP has introduced new rules on performance reporting, new systems for area monitoring and an increased focus on improving environmental sustainability. In this context, farmers across Europe and in Ireland have been highlighting the many challenges they are facing, and the difficulties in managing these when considering climatic and economic conditions.

The Commission listened to this and responded to farmers and member states concerned. They proposed this package of simplification measures to benefit both the farmers and the administrators. The proposed simplification will not satisfy all the concerns of farmers. However, the package amends the basic regulation of the CAP strategic plan to reduce the burden on farmers and it provides additional flexibilities to member states to respond to issues affecting farmers. The Commission has taken a targeted approach to provide flexibility while continuing to maintain a clear focus on the economic, environmental and social objectives set out in the CAP regulation. The changes are also designed to address issues across the EU, so certain provisions are not as relevant in the Irish context. The main changes relate to the simplification of the conditionality rules and the introduction of a new initiative to exempt small farmers from inspections and penalties.

I will deal with small farmers first. This is a mandatory element of the proposal and is effective from the publication of the legislation with immediate impact. Small farmers with an agricultural area of 10 ha or less will no longer be subject to inspections for conditionality and therefore will not be subject to any financial penalties under the CSP for failing to meet the conditionality requirement. This is a simplification for up to 20,000 farmers in Ireland. who will not be inspected or penalised under conditionality. It is important to note that these farmers must still comply with the statutory management requirements, for example, the national legislation on nitrates or environmental legislation. They also remain subject to mandatory inspections outside of the CAP, such as veterinary inspections for animal welfare. Farmers with 10 ha or less will continue to be subject to monitoring by the area monitoring system and to controls for CAP schemes outside of the basic income support for sustainability and for any national schemes. This change will apply to claims made in 2024. Farmers with more than 10 ha will still be subject to conditionality controls and penalties arising.

Other changes to conditionality relate to the good agricultural and environmental condition standards, or GAECs as they are more commonly referred to. There is a change to the scope of the GAEC 8 standard, which is intended to protect the maintenance of the non-productive features to improve on-farm biodiversity. The mandatory requirement for arable land to maintain 4% non-productive area is removed and member states must introduce a voluntary eco-scheme to support this objective. This change is more relevant for other member states with large arable areas and there will be little practical change for farmers in Ireland due to our high level of hedgerows and landscape features, which will still be protected under the amended GAEC 8. Ireland had already chosen to implement an eco-scheme to support space for nature. It is a popular option for farmers, and we already have this in place. On GAEC 7, the change allows farmers to comply with the standard through crop diversification or crop rotation. Some flexibility is also introduced to adjust the GAECs, in limited circumstances, to address issues arising from climatic conditions. This will be useful in a year such as this, where we could provide limited temporary derogations to farmers if they are impacted by climatic or weather conditions, which affect the timing or execution of GAEC standards. The proposal also introduces some additional flexibility around the setting of GAEC standards for the protection of soil, which are GAECs 5 to 7, inclusive, and GAEC 9 to allow member states establish specific limited exemptions. Those exemptions will be subject to certain conditions and must continue to deliver on the objective of each standard. However, some of the requirements in the GAECs, particularly GAEC 5 and GAEC 6, come from the nitrates regulation and are not covered by the simplification proposals.

There are some changes on the administrative side, with a doubling of the number of amendments we can make to the plan, and a change whereby assessments of whether new environmental legislation should impact the CSP will no longer have to be conducted from 2026 onwards. This amendment has moved through the colegislation process in a much faster time period than is usual, with limited time for consideration. It was subject to the urgency procedure. It has now been agreed by Council and the European Parliament and is expected to be published by the end of May. Some elements such as the 10 ha exemption from conditionality controls, inspections and penalties are applicable for the 2024 claim year. Other elements can only be implemented by way of an amendment to the CAP strategic plan. I trust this has provided the committee with a high-level overview of the changes introduced to the CSP through this proposal. My colleagues and I welcome questions in this regard. The Commission has indicated it intends to continue working on this issue of improving and simplifying matters for farmers. In this regard, a range of other issues are under consideration at expert group level. Consideration of the next CAP, post 2027, has started at EU level and further simplification is expected to be a central feature of this process.