Aindrias Moynihan (Cork North-West, Fianna Fail)
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The agenda for this next session is a discussion on EU COM (2025) 236. Before I commence, I remind the witnesses that witnesses giving evidence from within the parliamentary precincts are protected by absolute privilege in respect of the evidence they give to the committee. This means that witnesses have a full defence in any defamation action for anything said at the committee meeting. However, witnesses are expected not to abuse this privilege and may be directed to cease giving evidence on an issue at the Chair's direction. Witnesses should follow the direction of the Chair in this regard and are reminded of the long-standing parliamentary practice to the effect that, as is reasonable, no adverse commentary should be made against an identifiable third person or entity. Witnesses who are to give evidence from a location outside the parliamentary precinct are asked to note that they may not benefit from the same level of immunity from legal proceedings as witnesses giving evidence from within the parliamentary precincts and may consider it appropriate to take legal advice on the matter. Privilege against defamation does not apply to the publication of witnesses outside the proceedings held by the committee of any matters arising from the proceedings.

We will now begin our discussion on COM (2025) 236, proposal for a regulation of European Parliament and the Council amending EU Regulation No. 2021/2115. The committee will hear from the following officials from the Department: Ms Sinéad McPhillips; Ms Gaëlle O'Flynn; and Mr. Cormac McGann. They have two minutes to deliver their opening statement and then we will proceed to questions and answers.

Ms Sinéad McPhillips:

I thank the Cathaoirleach for inviting us to discuss this proposal.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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Do the witnesses need five minutes for the opening statement?

Ms Sinéad McPhillips:

No. I can cut it, although it might be three minutes rather than two. I thank the committee for inviting my colleagues, Ms O'Flynn and Mr. McGann, and me to discuss this proposal. This is a relatively modest simplification proposal to the CAP following on from simplifications last year. The proposed amendments can be summarised as changes in the following broad headings: changes to the green architecture, including controls and eligibility; changes to include a crisis reserve and risk management tools within the CAP strategic plans; changes in relation to competitiveness and digitalisation; and changes to the administration of the CAP. In each of these four blocks, there are some mandatory changes that, if accepted, will automatically come into force. There are also voluntary adjustments and new measures, which member states can choose to implement if they wish. There are also changes to some CAP measures which are only implemented in certain member states.

The focus of the proposals is on providing additional flexibilities to member states within the existing suite of CAP strategic plan, CSP, measures. However, it is important to note that there is no additional funding attached to this proposal. Therefore, the implementation of any new options would have to be funded from within the existing CSP envelope. As members will be aware, the financial allocation of €9.8 billion under the Irish CAP strategic plan is already fully committed for the current period of 2023 to 2027. Expenditure under the CSP amounted to €1.9 billion in CAP financial year 2024, for example.

The proposal is proceeding through the ordinary legislative procedure involving the Commission, the Council, and the European Parliament. At present, the proposals are being discussed in the Council working group. When a general approach has been agreed at Council level, trilogues with the European Parliament will follow. We do not expect the final regulation to be adopted until the end of this year at the earliest. Any changes introduced will only be applicable for the last two years of the current CAP strategic plan, that is, 2026 and 2027.

The Department has been engaging regularly with stakeholders, including the farm representative bodies, environmental NGOs and others, on this simplification proposal and will continue to do so as it progresses through the European system. We expect that overall, there will be limited changes for the Irish CAP strategic plan in the current round arising from this Commission proposal. Stakeholders are broadly in agreement that stability and certainty for farmers should be the priority for the final two years of implementation of the current plan.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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I will allocate four minutes per member. Is that agreed? Agreed. I call Deputy Fitzmaurice.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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I thank the witnesses for coming in. In the context of this simplification, to put it simply, from everything I have read on what the Commissioner is on about, my understanding is that they are talking about smaller farms. There are lot of 5 ha and 10 ha farms in Europe. While there is this buzzword about making things simpler for farmers, it is not applicable to an awful lot of what we are at here in Ireland. There was talk about GAEC being looked at again, although I am hearing it will not be. There was also a piece in the newspapers today about a farmer extracting water under the water framework directive under an inspection with an inspector from the Department of agriculture. The inspector has to look to see whether more than 25 cu. m per day is being taken out of a private well under the BISS. It is said that that might be eliminated. What I am wondering-----

Aindrias Moynihan (Cork North-West, Fianna Fail)
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If the Deputy wishes, he can send that information into the committee.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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My reading of this is that it is about simplifying things and not having inspections for farms of between 5 ha and 10 ha. Over that, in the witnesses’ opinion will any of the items that farmers are at today be simplified from their reading of the COM, to put it simply? I thank the witnesses for their time.

Ms Sinéad McPhillips:

I thank the Deputy. Overall, it is a fairly underwhelming simplification. I suppose it is good to get some ideas about what might be coming down the tracks in the next round of CAP. There is definitely a focus at European level on small farmers. Some 7 million of the 9 million farms in Europe are under 10 ha. There are some real simplifications for those farmers. Last year, there was a reform that meant those farms are no longer subject to conditionality and inspections, which is a much bigger deal for other member states than it is for us. In this proposal, there is a specific small farmers scheme payment, which was €1,250 but has now doubled to €2,500. While it would mean that the scheme is not introduced in Ireland, those farmers would get that payment instead of getting their direct payments of BISS and CRISS and so on. We do not think it is of major interest.

With regard to the GAECs, there are some changes to the GAEC standards in the proposal. When we were being consulted by the Commission, we asked specifically that GAEC standards would take account of any national standards that are targeted towards the same objective as the GAEC. That has been included in the Commission's draft regulation.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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What does that mean?

Ms Sinéad McPhillips:

It means that the proposal adds recognition of the national requirement when the conditionality standards are being set. We negotiated with the Commission for our own GAEC 2 standard in order that we could take account of national requirements for the protection of peat soils without having to duplicate that in the GAEC standard. We asked for more subsidiarity in setting our GAEC standards, including the ability to derogate from GAEC 2 on the basis that there were existing national and other EU regulations that covered those points, but the Commission made it clear that that was a red line and that GAEC 2 had to remain.

It has added this recognition of national standards when the GAEC 2 standards are being set.

Martin Kenny (Sligo-Leitrim, Sinn Fein)
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I thank the witnesses for their presentation. Following on from Deputy Fitzmaurice, my understanding is that much of this proposal is for small and minor changes. However, it indicates the direction of travel in respect of the new CAP and is, therefore, of some interest. Ms McPhillips mentioned GAEC 2 and there is talk of some eco schemes coming into that. There is also more recognition of organic farming. Organic farmers will automatically be considered for GAEC 1.

Payments per animal or beehive were mentioned. In respect of all these simplifications, as they are called, will farmers have to do anything or is it just a process that happens at a level out there?

Ms Sinéad McPhillips:

I thank the Deputy for the questions. In many of those cases, these are optional measures for member states. Each member state has its CAP strategic plan, CSP, and has chosen from the toolbox of CAP measures. Some of the changes will allow them to do something slightly different within that toolbox. Some member states organise organic payments on a livestock unit basis. We do not. Instead, we do it on a per hectare basis. There will be some change options in that regard. There will be some compulsory changes and some optional changes. There are also some changes to measures that we in Ireland do not implement. Overall, the impact will be fairly modest.

Martin Kenny (Sligo-Leitrim, Sinn Fein)
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It is really giving an indication of what the menu may be in the next CAP rather than what will be implemented. Member states can work out the elements of it that they wish to embrace or leave.

Ms Sinéad McPhillips:

That is correct. There are probably some nuances. We are not at the end of the legislative process yet. My colleague, Mr. McGann, is attending working group parties in Brussels on a regular basis to discuss the details. The European Parliament will share its views. As I have said, we have heard the strong view of stakeholders that in the two years left in the current CAP strategic plan, we want to ensure the schemes work effectively with no delays and farmers understand well what is being asked of them by the current CSP. Any major change now would be disruptive.

Danny Healy-Rae (Kerry, Independent)
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I was not here at the start of the meeting so I am not fully versed. I am sorry. I am interested but was held up.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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Will I move to the next speaker and come back to the Deputy?

Danny Healy-Rae (Kerry, Independent)
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Yes.

Paraic Brady (Fine Gael)
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I also missed the start of the meeting. We have all looked for simplification. Whether you are farming 10 ha or 70 ha, it should apply across the board. Unfortunately, it seems to be set up for the lesser farmer. Is that correct?

Ms Sinéad McPhillips:

I thank the Senator. There is certainly an emphasis on smaller farmers and reducing their administrative burden. I do not think it is fair to say that the whole thing is focused on farmers with a very small number of acres. This simplification follows from a significant simplification - I apologise for the repeated use of that word - package last year. These are technical tweaks. They allow member states some additional options within their CSPs. One of the main points is that they do not have any additional budget attached. Member states are free to choose to do some of these optional extras but it will involve cutting money elsewhere.

Paraic Brady (Fine Gael)
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Will the environmental aspect come as a single budget or will it be tied in? Are there two pillars?

Ms Sinéad McPhillips:

This proposal relates to the current CAP strategic plan and regulations. We expect before the end of July, and probably next week, proposals for the CAP post 2027. That will be a Commission communication giving its view on what should be in the CAP post 2027. The COM we are talking about now relates to the current strategic plan, which only runs until 2027. As I have said, if this goes through the legislative procedure, it will come into law at the end of this year and will apply for 2026 and 2027 only.

Paraic Brady (Fine Gael)
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Come 2028, will it need to be regulated, going forward?

Ms Sinéad McPhillips:

We expect the Commission to come forward with proposals for the CAP post 2027. That will be done in parallel with the proposals for the next EU budget or multiannual financial framework, which will govern the period from 2028 to 2035.

Paraic Brady (Fine Gael)
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It will run until 2035.

Ms Sinéad McPhillips:

That will be a whole new legislative framework for the EU budget and the CAP. What the Minister has advocated for is a stable and robust CAP with as little overall change as possible because we believe we have a good CAP strategic plan and want the possibility of using those measures again. We will wait to see the proposal in that regard but that is a separate process from this COM.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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To be helpful to the Senator, the committee has scheduled a third meeting for September at which the CAP post 2027 will be on the agenda. We will have the opportunity to drill deeper then. There is an expectation that there will be another related COM.

Danny Healy-Rae (Kerry, Independent)
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I am getting worried. Ms McPhillips mentioned that money would come out of some other scheme to be put into the small farmers' scheme. I remember that kind of carry-on at the council when we would ask to put in a road. The gun was put to your head to decide what road to take out. I am not in favour of this at all. I would not want to take money out of some other fellow's pocket so we could give it to the so-called small farmers. The opening statement from Ms McPhillips states, "Participants in a small farmer scheme would not be eligible for [basic income support for sustainability] BISS, [complementary redistributed income support for sustainability] CRISS or other direct payment schemes under the current rules." I am very worried about all of that. I cannot see that it is of benefit to many. I cannot visualise any fellow around me who falls into that category. I am worried. Perhaps Ms McPhillips would expand a little.

Ms Sinéad McPhillips:

I thank the Deputy. To explain, the small farmer scheme is an option in the current CSP. It is optional for member states to choose to implement it. We have not chosen to do so and the change under this COM will not make it compulsory in Ireland. It would be an option. As the Deputy said, taking the option would involve cutting funding elsewhere. That is the difficulty.

Danny Healy-Rae (Kerry, Independent)
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I say we should forget about it.

William Aird (Laois, Fine Gael)
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I thank the witnesses for coming in. There are 20,000 farmers in Ireland with less than 10 ha. Those 20,000 farmers are in those schemes. If those 20,000 farmers were offered something else, the money would have to come out of it. We will leave that as it is. Ms McPhillips can answer that question in a moment.

I would like to ask Mr. McGann a question. He is out there on the front line. I am confused about why this is coming out at this stage. Does this have something today with the CAP Pillars 1 and 2 eventually coming down? We were told at one stage that we would know what will happen by July. Why this far into the current CAP is there a proposal for a simple change such as this? I am worried.

I cannot see what benefit it is to a farmer to change from where he is at present. There is certainly no financial gain. I am just learning in this, the same as everybody else. There was mention of beehives. My neighbour keeps a good few beehives. I have them on the farm but they are not mine. Is it something like that, so people could switch but the money would stay the same? Are they giving people an opportunity to do something like that? Is that what it is about? I would love if the officials were able to tell us because they have information and they know things we do not know about what is coming down the tracks. They are over there and getting it all from those people. I would be a little bit nervous. I would love to know their thoughts about what is going on over there.

Ms Sinéad McPhillips:

There are around 20,000 farmers in Ireland with less than 10 ha, as the Deputy said. The simplification package last year meant that those farmers are now not subject to inspections or penalties on their basic payments and so on. The proposed change this year in respect of the small farm scheme, as I mentioned in reply to Deputy Danny Healy-Rae, is optional. We do not have to implement that in Ireland. Those farmers under 10 ha are currently qualifying for BIS, CRISS, eco-schemes, ACRES and so on. There is no barrier to them being in those schemes. Our view when we were setting up the CAP strategic plan was that farmers were better off in that full range of schemes rather than getting a single payment of €1,250, which has now moved to €2,500. We will certainly examine it but on the face of it, we do not think there is any advantage in moving to that system. On the proposals for the next round, as the Cathaoirleach said, there will be a fuller discussion when we have those proposals. Talking about it now would be speculation. I will bring Mr. McGann in now, particularly on the beehives point because he is the expert on that.

Mr. Cormac McGann:

The first question was really why now for this particular simplification package. This is actually the second one and it has been part of a longer process that the Commission has been running since the start of this CAP. Some emergency measures were brought in during the first year of the CAP. Last year we had the omnibus simplification, derogating farmers on less than 10 ha from controls for conditionality. This is the next step in the process, additional measures that can be introduced within the current CAP for simplification. As to how they come up with what is in it, a long public consultation has been going on which the Commission has been running over the past two years. There were open public consultations where anybody could fill in the survey. There were expert interviews, including with members of our Department as well as the IFA and other experts in Ireland and across the European Union. There is also the European CAP network, which has been running thematic expert working groups to work through the problems, identify where they are and put forward solutions.

On the beehives, that is just one of the many requests that have come from those stakeholder consultations, with people asking for more flexibility in how the current suite of tools are operated. People who are currently bound to take their payments on an area basis are saying it would be useful if they could make the payments per livestock unit or per beehive for certain types of intervention. That is the reason behind it. I hope that is helpful.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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The recommendation from our own adviser is that we are happy to move ahead with no need for further scrutiny on it. Is that agreed? Agreed.

William Aird (Laois, Fine Gael)
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I will just say that it is agreed with caution. That is all I will say.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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I thank the officials for their contribution and information on the measures.