Michael Healy-Rae (Kerry, Independent)
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We have received apologies from Senators Craughwell and Leyden. I remind members to ensure that their mobile phones are switched off.

I acknowledge and welcome His Excellency, Mr. Leonard Sacco, and his officials from the Embassy of Malta to the Public Gallery. We are delighted to have an engagement today with the president of the Irish Farmers Association, Mr. Joe Healy, and his colleagues. I welcome them to the meeting. We have had good engagements with representatives from the ICMSA and Macra na Feirme. We are delighted to be able to follow up with today's engagement. As was said that day, the farming community is a very important voice in the process of defining what the future of the EU should look like. We are very appreciative of Mr. Healy's input today.

I draw the attention of witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable.

Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official either by name or in such a way as to make him or her identifiable.

Mr. Joe Healy:

I thank the Chairman and the members of the committee for the opportunity to input into the debate on the future of Europe. This is a subject of major importance to Ireland today and it is timely that I am making this presentation on the same day as the Government is launching the citizens' dialogue on the future of Europe. I welcome the Taoiseach's comments and his support for the future of the Common Agricultural Policy, CAP, and assure the members that the IFA will not be found wanting in spreading the message. I am joined by our director general, Mr. Damien McDonald and our Oireachtas liaison officer Ms Elaine Farrell, who is well known to the committee.

The UK decision to leave the EU will impact hugely on Ireland. It is timely, therefore, to take stock of what the EU project now stands for and what direction it should take. Of all of the sectors in society, farmers are those who are most aware of the benefits that EU membership has brought. For Irish farmers, EU membership has meant access to a market of 500 million consumers, the stability provided by CAP payments and the ability to grow and diversify our export markets.

The Common Agricultural Policy was provided for in the Treaty of Rome in 1957, and its objectives were set out in that treaty. These are to increase agricultural productivity, to ensure a fair standard of living for farmers, to stabilise markets, to ensure the availability of supplies, and to ensure that supplies reach consumers at reasonable prices. These principles remain equally relevant today.

Financial solidarity was a key principle of the new CAP, with spending on the CAP to be borne by the central European budget. The CAP is of vital importance for producers and provides European consumers with a plentiful supply of high quality, sustainable food produced at affordable prices. There is now recognition for the multiple roles of farmers as food, fuel and energy producers in addition to meeting environmental requirements and other public goods. Over the years, it has undergone significant reforms, responding to the demands of European society and consumers. The current two-pillar structure of the CAP addresses complementary but differing needs. The role of the basic payment and market support measures in Pillar 1 is to support farm incomes and the delivery of public goods. The main focus of the rural development programme under Pillar 2 is on farm-based, economic, environmental and social programmes delivered at member state and regional level.

The next CAP reform will take place in the context of new challenges facing Europe, including market volatility, climate change, and the UN sustainable development goals, SDGs. Farmers are committed to delivering on the public good requirements relating to the environment and climate change. This is in addition to the delivery of quality food and meeting the highest regulatory standards in the areas of food safety and animal health and welfare. In return, farmers must be provided with a fair standard of living. Low farm incomes in many sectors continue to provide a challenge to the sustainability of farming enterprises across the EU, and to attracting new entrants into farming. Simplification of the CAP is also critical. The reform of the CAP over many decades has led to a serious increase in the regulatory burden on farm enterprises. The EU is blamed for the bureaucracy and red tape associated with the CAP. The rules of the payment system and inspection regime must take into account the realities of farming, and the increased use of technology and risk-based analysis must be progressed. The IFA believes that the EU should set as a target in the next CAP reform the delivery of a strong, sustainable and competitive agriculture for the benefit of farmers and consumers alike.

This requires a strongly funded CAP budget, reversing the cuts imposed in the multi-annual financial framework, MFF, for the period 2014 to 2020, through direct income support and market management measures in pillar 1, and co-financed farm schemes in pillar 2.

In the Commission's White Paper on the future of Europe, published last March, a number of potential scenarios for the development of the EU project are outlined, and their potential impact on key policy areas are summarised. From a farming perspective, the IFA believes that continuing the completion of the Single Market remains very important. Now, more than ever, free access to and regulatory coherence within the EU market is very important. However, this should not be the sole focus of the future EU. In addition, strengthening existing common policies, such as the CAP, is critical to securing a strong future for the EU, and in demonstrating to citizens the positives of EU membership. The Commission's June reflection paper on the future of the EU finances identifies that the CAP reaches farmers and citizens even in the most marginal areas of the EU, having a positive impact on economic and social development in those areas. It further suggests that improvement to the policy can arise from putting more emphasis on incentivising farmers to deliver environmental and climate public goods and services. The IFA is very concerned, however, that in four of the five scenarios outlined for the future EU budget in the paper, a reduction to the CAP budget, either as a percentage of the overall EU budget, or a direct cut, is envisaged.

The IFA recognises the challenges facing the EU budget, including the withdrawal of the UK, a net contributor, from the EU, and the need to finance new priorities. It is unacceptable, however, that existing budget programmes, such as those associated with the CAP and cohesion funding, would be simply reduced to accommodate new challenges. The IFA believes that member states should increase their contributions, if necessary, to take account of Brexit, to fund existing policies, such as CAP and cohesion policies, and to take on new priorities, where agreed between member states.

The last MFF was agreed against a backdrop of economic downturn in the European Union, with direct cuts to the CAP budget. Since then, there has been a significant recovery for the EU economy. The IFA believes the future CAP budget should be linked to the growth of the EU economy, which would enable increases in funding.

Let me refer to a couple of the other issues that arise. Brexit presents the most serious threat to Irish farming and our agrifood sector since we joined the EU. With 40% of our food exports going to the UK, no other member state and no other sector is as exposed in these negotiations. The outcome of the Brexit discussions, and the impact on different member states and sectors, is very much linked with the discussion on the future of Europe. The IFA has set as key priorities for the agriculture sector in these negotiations the maintenance of the closest possible trading relationship between the UK and EU, while preserving the value of the UK market, and the provision of a strong CAP budget following the UK's departure. The optimum outcome is that the UK remains within the customs union and the Single Market. This would address both trade and border issues. The next best option is that we have a comprehensive free-trade agreement between the EU and UK with tariff-free trade for agricultural products and food; the maintenance of equivalent standards on food safety, animal health, welfare and the environment; and the application of a common external tariff for food imports to both the EU and the UK.

On EU trade policy, within the EU there must be greater coherence between the CAP and EU trade policy. It is essential that the correct balance be found between the opening new markets, availing of trade opportunities and protecting sensitive sectors. The value of the EU market cannot be undermined by increases in low-cost food imports that do not meet the high food-safety, animal welfare, health and environmental standards that are required of EU producers. Mercosur is a case in point. The EU seems hell-bent on securing a Mercosur deal regardless of the costs to agriculture and the impact on rural areas.In recent weeks, the EU have already offered an additional 70,000 tonnes of beef quota to Mercosur countries, and this comes on top of preferential market access they already have, representing 246,000 tonnes. There is already talk of more.We know from the Brazilian weak flesh fraud those concerned fail to meet EU standards on all of the key issues of traceability, food safety and the environment.Indeed, the latest EU report from the Food and Veterinary Office states the Brazilian competent authority is not in a position to guarantee that the relevant export requirements are met.In addition, the report states the competent authorities are signing export report certificates despite being unable to ascertain the veracity of certain statements therein.In Ireland, the sector is based on meeting the highest standards and environmentally sustainable grassland production systems.Irish beef production systems are between two and four times more efficient than South American production in terms of climate change and greenhouse gas emissions. It is well established that the growth in South American beef exports, particularly exports from Brazil, has come about on the back of widespread destruction of the rainforest in the Pantanal and Amazon regions. It would be a total contradiction of EU policy on climate change for Europe to agree a Mercosur deal that replaces sustainable EU beef production for European consumers with product from South America, which has a much higher carbon footprint.

On top of all of these issues, we have Brexit. Half our beef exports go to the UK market. Therefore, Mercosur negotiations at this time make no sense whatsoever. I would go so far as to say they are reckless. We are requesting that our Taoiseach and Minister redouble their efforts in opposition to Mercosur in defence of our key beef sector.

In the area of climate change, while I am concerned by retired professor Alan Matthews's proposal to the Citizens' Assembly to introduce a further €30 million trade-distorting carbon tax on the sector, I am reassured by the perspective of An Taoiseach, Deputy Leo Varadkar, that Ireland's focus on cutting emissions should be on energy and transport, given that greenhouse gas emissions have increased by 130% since 1990, at a time when emissions from the agriculture sector have declined by almost 6%, despite our output increasing by more than 40%.

Turning to the European focus of today, I am extremely concerned about the impact on the future sustainable development of Ireland's agrifood sector arising from positions taken by our Members of the European Parliament regarding the Commission's 2030 climate proposals. Their position fails to recognise the October 2014 European Council decision that recognises that agriculture has multiple roles and that food production must not be threatened when addressing the climate challenge. Of specific concern are the amendments to change the 2030 starting point from the average of 2016, 2017 and 2018 to 2020 and the reduction in the LULUCF allowances. These will impact most on Ireland and will lead to an additional liability of more than €1 billion. The strong position taken by Government, particularly the Minister for Communications, Climate Action and Environment, Deputy Naughten, is welcome in the ongoing discussions.

Ireland is taking a leading position in Europe by targeting European funding, through the CAP, at measures that reduce greenhouse gas emissions in the sector.

Some 87% of the measures in Ireland’s rural development programme have climate reducing elements. Irish farmers participate in carbon monitoring, measuring and management through programmes such as Bord Bia’s Origin Green programme, the Department of Agriculture, Food and the Marine’s beef data and genomics programme and the green low carbon agriculture scheme, GLAS. All of these schemes promotes the retention of soil carbon stocks through the encouragement of climate-friendly agricultural practices. Farmers will continue to build on our sustainable model of food production and to seek to make improvements in carbon efficiency right across the food supply chain.

One of the initiatives in place is the IFA-led smart farming programme, run in conjunction with the Environmental Protection Agency, EPA. Smart farming is farmer-led and focuses on demonstrating win-win situations that improve farm incomes, enhance the environment and reduce greenhouse gas emissions.

I thank the Chairman for the opportunity to input into the discussions on the future of Europe. The coming months will be very important in the context of expected initial proposals on the multi-annual financial framework post 2020, and the further development of the Commission position on the reform of the CAP. It is critically important that the Government, led by the Taoiseach and Minister for Agriculture, Food and the Marine, as well as Commissioner Hogan at EU level, make the strongest case for a fully-funded CAP post 2020. Irish farmers remain strongly positive towards the European Union, recognising the benefits that EU membership and the CAP have delivered. I hope that the outcomes of these discussions can deliver practical changes and contribute to delivering a stronger and better Europe for all its citizens.

Michael Healy-Rae (Kerry, Independent)
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I thank the witness for his broad overview. The importance of some of his comments, for example those concerning our beef trade and our exports, can never be overstated. I want to compliment him personally on my own behalf, and thank his organisation for standing shoulder to shoulder with our farming community over several decades. Mr. Healy, his predecessors and the staff who work in the IFA are very helpful to us as politicians at all times. The back-up, assistance, networking and general support that it gives to our farming community, in good times and in bad, is second to none. Every organisation has ups and downs, good days and bad, but the IFA is what I would call a highly respectable, hard working and committed group of people, and I would like to put that on the record.

Neale Richmond (Fine Gael)
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I am delighted to welcome the IFA. It speaks before us regularly and gave a very strong presentation to the Seanad Special Committee on the Withdrawal of the United Kingdom from the European Union hearings earlier in the year. Despite my accent there are 63 members of the IFA living in my constituency. While it is not perhaps a big issue for many of my constituents as other people around this table there are a few key issues in which a few of us Dubs have an interest.

I congratulate the witness on his re-election. It was a mighty contest and it is a reflection on the work he has been doing in recent years.

On the wider area of new alliances for Ireland in Europe in the future, one of our strongest alliances, when it comes to the CAP, is with France. The witness raised a number of concerns about Mercosur. I understand and share those concerns. In a previous life, in the trade portfolio, I covered the regions in the committee. It was easier then because we were talking about the trade deal with Japan, but there were issues with the EU-Canada Comprehensive Economic and Trade Agreement, CETA and the Transatlantic Trade and Investment Partnership, TTIP. However, Mercosur presents a different level of challenge to Ireland specifically that our colleagues in Europe may not feel to the same extent. TTIP and CETA raised challenges for trade movement in Germany and that challenge was far more pronounced than it was here. What are the alliances for the IFA in terms of other farm organisations across Europe, and how is it working to build agreement? When it comes to the CAP and agricultural policy in general does, Mr. Healy agree that France remains our strongest ally? How do we retain that alliance? As the current French President is a Europhile, perhaps it will be easier but it will be more difficult as one sees the rise of the hard left and the protectionist nature of Jean-Luc Mélenchon and others within France.

I want to ask about the IFA's role in the conversation on all European issues in the future. Mr. Healy's statement that "Irish farmers remain strongly positive towards the European Union, recognising the benefits that EU membership and the CAP have delivered" is key. I appreciate the strong role that the IFA has played, especially in recent months, in terms of preparing their members and Irish society at large for the fallout from Brexit. There have been rare occasions where I would argue that the IFA's contribution to the pro-European movement in Ireland has been lacking. I am thinking of the first Lisbon treaty, when it entered the debate at a very late stage and was not enthusiastic in its support. The vacuum created allowed many of the misinformed eurosceptic organisations to take a hold and take root in certain rural communities, which ultimately led to the fall of that referendum. When the referendum was run a second time, as well as with the one on the fiscal stability treaty, we saw the IFA throw their resources behind it. I fear greatly, however, that in the future, that calculated risk could be taken again. I am not talking as someone who is looking for constant balanced argument. I am talking strongly as a really pro-European politician. I believe Europe is the key to the future of our agrifood sector. We were at the launch of a future of Europe discussion this morning. There has been a 90-fold increase in trade for Ireland since we joined the EEC in 1973. Much of that trade has been in the agrifood sector. While the challenges of Brexit will be massive for the agrifood industry - particularly for certain things such as cheddar cheese - we will still rely on our next nearest market beyond the UK being the EU. While there is huge potential in south-east Asia in particular for certain sectors, and indeed Australia, but ultimately our greatest level of partnership will be on the Continent. I make my next point as a comment, not a challenge. As we go forward into this highly challenging post-Brexit era, where the Government and Irish civic society will be committed to having good relations with the UK but to staying in and being at the heart of the EU, where our future lies, we really need to see the IFA and other similar organisations maintain that commitment. I do not want to take away from what Mr. Healy said. I was heartened to hear it but I want to put on record that we need to see that commitment constantly in the future. I am all for constructive criticism where needs be but I warn against the occasional calculated risk.

Seán Haughey (Dublin Bay North, Fianna Fail)
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As I represent an urban constituency in Dublin Bay North, agricultural issues do not arise very often. That said, I appreciate the important role that agriculture plays in the national economy. Mr. Healy pointed out that 40% of our food exports go to the UK, and that makes Brexit a great challenge for all of us.

If my questions appear very basic it is because I am not involved in the day-to-day detail of agricultural policy. From where does the threat to CAP arise? Mr. Healy made the point strongly that we should be committed to a fully-funded CAP post 2020. All of us will agree with that, it is in our national interest and the joint committee should include the country's strong commitment to the CAP process as a nation state in our final report.

Is it purely a budgetary issue from the point of view of the European Union as a whole or is it maybe something to do with increased urbanisation? Where do the farmers see the threat to CAP coming from? Mr. Healy mentioned that most of the scenarios put forward by the European Commission envisage the CAP being reduced in some way or other.

On a separate but maybe related issue, do the witnesses have statistics for the consumption of beef and meat generally? There seems to be a movement in urban areas to say that meat is bad for one. Perhaps it has to do with climate change, I am not sure, or maybe it is a health issue too and young people in particular are becoming vegetarian. Is that of concern to the IFA and farmers?

Michael Healy-Rae (Kerry, Independent)
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I cannot let the opportunity go by to remind everybody that the Deputy's late father, God be good to him, sold an awful lot of beef for us at a critical time when nobody else was capable of doing it. He went abroad, and I will never forget it, he was like Our Lord when he came back, we were so delighted with his salesmanship.

Seán Haughey (Dublin Bay North, Fianna Fail)
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The Chairman had better not mention the farmers' strike in the 1960s. I remember it as a child.

Michael Healy-Rae (Kerry, Independent)
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I remember being told about that but I was not going to dwell on that. I was only going to dwell on the positive.

Mr. Joe Healy:

I will start by responding to Senator Richmond on the new alliances. He is right when he speaks about France. The IFA is aligned throughout Europe because it is part of COPA, the European umbrella body for farm organisations. We are the only Irish organisation associated with it. I had a meeting with it last week in Brussels and will meet it again at the end of the month. We are constantly in touch with our fellow organisations throughout Europe. We have a very strong relationship with the French because we think alike on many issues and CAP is one of them. We deal with farm organisations across Europe, whether in Denmark or Belgium, or wherever. I am vice president of COPA. The president is a German who comes from the same region as the Commissioner for Budget and Human Resources, Mr. Oettinger. He came to speak at one of our recent meetings. Having those alliances and constantly building them is very important for the IFA. We not only meet at the meetings but we often meet for bilaterals too. It is crucial to have that. There is no point in our organisation looking for an extension to, for example, the glyphosate licence or an increase in the CAP budget on our own. We have to be sure we have support.

I would take issue with the comment that the IFA was lacking in the past. The one time we were lacking and got our backs behind it, the vote was carried and rural Ireland did support it. That proved how crucial the organisation is.

On Brexit, the main threat to the future funding of CAP comes from the exit of the UK. It is a net contributor to CAP to the tune of €3 billion. It gives €10 billion to the EU budget, €6 billion of that goes to CAP, €3 billion of which goes to UK farmers. If we take €3 billion out of the total CAP budget of between €56 billion and €58 billion, that is a sizeable 5% to 6% drop. There is also the question of the new EU initiatives being discussed, to do with security or defence. Our argument is that for any new priorities there must be new money.

Maybe our organisations and politicians have failed over the years to get across the benefit of CAP. People see it as a benefit to farmers across Europe. CAP has benefited the 500 million European consumers very significantly. When it was introduced in the early 1960s, 30% of the average household income was being spent on food. Today, for better quality food that is more traceable and produced to a much higher standard, only between 10% and 12% of the average household income is spent on food. CAP has allowed an adequate supply of safe, traceable, quality food to be produced at very affordable prices. Those are the threats.

To answer the second part of the question about beef, Europe is already 102% self-sufficient in beef supply. When the UK leaves it will be 116% self-sufficient in beef. The European consumption of beef is dropping year on year, for various reasons maybe because well-known models or sports stars advertise on social media against it without any scientific backup – that is possible nowadays on social media. That is why I say talk of a Mercosur deal is reckless, based on consumption dropping, an oversupply already and that oversupply getting worse, going from 102% to 116% in a couple of years' time when the UK leaves the EU.

Mr. Damian McDonald:

I will just echo some of the comments made by Mr. Healy. The IFA has always been a staunchly European organisation. We supported the European Union and that remains the association's position. As most members of the committee know, however, there are frustrations with the European Union among farmers. It is important that they are not forgotten. The president has already outlined the situation in respect of Mercosur and the potential implications of Brexit and how the EU will respond to that. Commissioner Hogan has talked a lot about the simplification of the CAP. While it is critical, it has frustrated some farmers by bringing in a lot of red tape and bureaucracy, some of it perceived as unnecessary. A move to simplify it and make it easier for the participants would be very welcome.

Farmers are frustrated. There is the upcoming vote on glyphosate where the European scientific agencies are giving the green light to this product yet the political system is not responding to that. A decision has not yet been arrived at. It did not get through for ten years. A five-year approval was not passed. It is down to four years now and will go to appeal. That causes frustration for farmers as European citizens who say if we are not basing what we do on science where does that leave us. It raises questions such as if the European Union prohibits certain products, and there are plenty of those already, it does not seem to apply the same standards to products which are imported which can be used although they contain some products that are banned in the EU. It places them at a competitive advantage.

The IFA, like any association, is a democracy and I would not be aware of the background to the Lisbon treaty but it is important that Irish citizens' support, farmers included, for the EU, which has generally been very strong, is not taken for granted. That is a message the EU has to take on board. Our position has always been that we negotiate as an EU 27 and back the European position. We met Michel Barnier and we are very much part of that process.

However, if farmers are faced with a scenario where we have Brexit and the UK goes off and does its own thing and then we find the Common Agricultural Policy, CAP, being eroded, our markets being eroded because agriculture becomes a sacrificial lamb in a trade deal with Mercosur, that is not a way to keep European citizens behind the EU project. It is important that the European Union delivers for farmers and all citizens if it is to continue to keep its support. The President made a point about Mercosur and the carbon impact of beef coming from Brazil versus the carbon impact of beef in Ireland. It can be two or four times the land use changes involved because a lot of rain forests are being felled in Brazil to turn them into pasture land. However, there are, at any point in time over the past number of years, between 6 and 7 million cattle in Ireland. There are 226 million cattle in Brazil. That is the scale and one can see how frustrated Irish farmers are when they see the emphasis being placed on methane output from 1 million cattle and the European Union going to facilitate a much less carbon-efficient beef production coming into the European Union from one country. There are 53 million more cattle in Argentina. The policies and decisions that the European Union makes have to make sense to farmers and the citizens.

Michael Healy-Rae (Kerry, Independent)
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Can I-----

Mr. Joe Healy:

To add to what Mr. McDonald said, and this is in the presentation, we as farmers in Ireland and across Europe see the bureaucracy, the red tape, the standards, the traceability that we have to have in order to qualify for various payments, in order to qualify to get our cattle killed and in order to qualify to farm. We do not mind doing that because we have to have that from an exporting nation. We are doing that to satisfy European rules. However, then we see that same European authority willing to do business with a country where the EU food and veterinary office states that the Brazilian competent authority is not in a position to guarantee export requirements are met. That can be very frustrating and it is little wonder that farmers would get frustrated with that sort of a set-up. On a point of clarification, I might have gotten a bit tongue-tied earlier on. I referred to Land Use, Land-Use Change and Forestry, LULUCF.

Paul Coghlan (Fine Gael)
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The witnesses could be facing a lose-lose situation between CAP changes and Brexit. Have the witnesses discussed these matters with EU Commissioner Hogan? Have the witnesses met with him on the detail of this? What kind of an answer is he giving?

Mr. Joe Healy:

I think Commission Hogan has gone on record talking about standards in the Mercosur situation. We feel, and the Food and Agriculture Organisation, FAO, states very clearly, that Brazil, for example, is not able to meet the standards. It is not in a position now, it has not been in a position in the past and is very unlikely to be in a position in the very near future to meet those standards.

Paul Coghlan (Fine Gael)
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With Britain gone, as a result of Brexit, they could do a deal with the Brazilians and Brazilian beef could get into Northern Ireland. Smugglers in south Armagh could invade our space. We have a lot of problems ahead all right.

Michael Healy-Rae (Kerry, Independent)
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We have a difficulty with sheep. However, we will not go into that subject now.

Mr. Damian McDonald:

That is the real danger. Even if we can continue to have a trading relationship with the United Kingdom that is similar to the one we have today, if the UK is able to go off and do its own trade deals willy-nilly we run the risk then that our markets will taken over by inferior standard products coming into the UK. There is a lot of talk about the Border but I think it is very clear the nature of the Border that we have for the future will be determined by the future trading relationship. The only solution really in terms of having a border-free scenario is if the entire UK stays within the customs union or something similar. Otherwise, we are going to be faced with a Border. It is unavoidable.

Michael Healy-Rae (Kerry, Independent)
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On behalf of the committee I thank the witnesses for being here today. I would just like to put it on the record that there has always been a great relationship between the IFA and two Houses of the Oireachtas, the Seanad and Dáil Eireann. It is helped greatly by the work of Elaine Farrell. She is held in high esteem by Members of both Houses and we thank her very much for her continual contact with us as Members; she makes our job easier by doing her job well. We thank her very much for that.