Aindrias Moynihan (Cork North-West, Fianna Fail)
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Apologies have been received from Deputy Kenny and Senator Boyhan. Senator Paul Daly is attending online and is on the campus.

Before we begin, I want to bring to everyone's attention to the fact 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, they are expected not to abuse this privilege and may be directed to cease giving evidence on an issue at the Chair's discretion. 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 giving evidence from a location outside the parliamentary precincts are asked to note that they may not benefit from the same level of immunity from legal proceedings as a witness 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 by witnesses outside of the proceedings held by the meeting of any matters arising from the proceedings.

I advise members of the constitutional requirement that they must be physically present within the confines of the Leinster House complex in order to participate in public meetings. I will not permit a member to participate where they are not adhering to this constitutional requirement. A member who attempts to participate from outside the precincts will be asked to leave the meeting. I ask any member participating via MS Teams that, prior to making their contribution to the meeting, they confirm they are on the grounds of the Leinster House campus.

Members are reminded of the long-standing parliamentary practice to the effect that they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable, or otherwise engage in speech that may be regarded as damaging to the good name of the person or entity. If their statements are potentially defamatory in relation to an identifiable person or entity, they will be directed to discontinue their remarks. It is imperative that they comply with any such direction.

Our agenda today is the Common Agricultural Policy post 2027. Before I go the agenda, I want to briefly acknowledge the developments with bird flu H5N1 today. It has been in the wild bird population for some weeks. We have seen poultry flocks in Fermanagh and Tyrone impacted by it. There was an outbreak in a turkey flock in Carlow in recent days. The Minister has issued a compulsory housing order and restrictions are in place. This will lead to the loss of our disease-free status, which will have an impact on poultry farmers, particularly in the run-in to Christmas and Christmas markets. It will be fairly stressful on farmers. I also want to acknowledge the difficulty at Fota Wildlife Park, which has been closed for some weeks due to bird flu. It has created difficulty for staff, as well as the loss of birds.

Teastaíonn uaim aitheantas a thabhairt do na hathruithe le fliú na n-éan, H5N1, le déanaí. Bhí an fliú i measc na n-éanlaithe fiáine ar feadh cúpla seachtaine agus anois tá sé ar fheirm turcaí i gCeatharlach agus scriosfar na héanlaithe sin. Tá an tAire ag cur srian ar éin bogadh mórthimpeall leis na héanlaithe eile agus caithfear iad a bheith istigh. Tá cailliúint stádas disease free ansin chomh maith agus beidh an-éifeacht aige sin ar fheirmeoireacht na n-éanlaithe, go háirithe nuair atáthar ag druidim i dtreo mhargadh na Nollag. Teastaíonn uaim é sin a choimeád in aigne agus an brú atá ar fheirmeoirí agus ar lucht gairdín na n-ainmhithe i Fota atá dúnta le tamall, agus cailliúint na n-éanlaithe ansin chomh maith.

Tá an tAire ag cur srian ar éin bogadh mórthimpeall leis na héanlaithe agus go gcaithfí iad a bheith isteach. Tá cailliúint stádas disease-free ansin chomh maith. Beidh an-éifeacht aige sin ar fheirmeoireacht na n-éanlaithe, go háirithe nuair atáthar ag druidim i dtreo mhargadh na Nollag. Teastaíonn uaim é sin a choimeád inár n-aigne agus an brú atá ar fheirmeoirí, agus ar lucht ghairdín na n-ainmhithe Fhóite, atá dúnta le tamall agus cailliúint na n-éanlaithe ansin chomh maith.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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The Chair might indulge me, as a local TD for Carlow-Kilkenny, by allowing me to express sympathy with the flock owner at this time. The Department is working hard to investigate the situation and to control and eradicate the disease. The risk to the general public from the strain circulating around Ireland and Europe is very low. It is important that this message gets out there. The HSE has been informed of the situation in Carlow. If necessary, the relevant public health experts can follow up. There is no food safety risk posed by avian influenza in respect of eggs and poultry meat once they are cooked properly. We are thinking of the Carlow owners at this time.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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We will now hear from Mr. Paul Savage, assistant secretary general, Ms Edwina Love, principal officer, and Mr. Cormac McGann, assistant principal officer, from the Department. Tá fáilte rompu. The witnesses' opening statement has been circulated to members. I will allow Mr. Savage five minutes to read the opening statement.

Mr. Paul Savage:

I thank the Cathaoirleach and members for the opportunity to discuss the CAP post 2027 with them. The CAP remains one of the EU’s most important common policies. It is central to food security, rural development and the EU’s climate and biodiversity objectives. It provides essential support for farmers and rural communities, helping to ensure the sustainability and competitiveness of the European agrifood sector.

The Commission’s proposals for the next multi-annual financial framework, MFF, published in July and September 2025, represent a significant change in how the future CAP will operate. Pillars 1 and 2 will be replaced with a single framework under a national and regional partnership plan, NRPP, with CAP measures to be delivered as part of that wider structure. This change will have significant implications for Ireland and for how we design and deliver supports to farmers, fishers and rural communities in the next programming period. The NRPP will fundamentally alter how the CAP operates within the EU budget. Ireland remains concerned about how these proposals will function in practice.

The traditional distinction between Pillar 1 and Pillar 2 will disappear. Instead, all interventions will be incorporated within the broader NRPP. The latter is intended to cover a wide range of EU supports, including the CAP, the Common Fisheries Policy, CFP, and cohesion policy. This change is intended to simplify EU budgetary governance, but there are concerns that it will introduce new complexity for member states, particularly as multiple policy areas will now have to be co-ordinated and delivered together.

For Ireland, 75% of our EU funding comes from the CAP. We need assurances that this new framework will not unduly impact our administration of this funding or our farmers. The total EU budget for the period 2028 to 2034 is proposed at approximately €2 trillion. Within this, the Commission has proposed a ring-fenced allocation of €296 billion for the CAP. Ireland is earmarked to receive €11.4 billion under what is termed the general allocation for the NRPP. Ireland’s proposed €8.16 billion CAP allocation will be drawn from this funding pool. This represents an approximate 20% to 24% reduction compared with the current €10.7 billion ring-fenced CAP allocation under the 2021-27 programming period.

The Commission has stressed that additional CAP funding can potentially be drawn from the broader NRPP envelope allocated to each member state. Notwithstanding this, the reduction in ring-fenced CAP funding presents challenges for Ireland. The €8.16 billion allocation must cover a full range of interventions, including area-based income supports, sectoral supports, agri-environmental measures and investment tools. While measures such as LEADER, the agricultural knowledge and innovation system, AKIS, and the EU school scheme remain mandatory, financing for these measures is not included in the ring-fenced CAP allocation and must be found within the broader NRPP allocation. Comparing the proposed allocations with the current MFF is complicated by the structural changes, which is why ongoing detailed analysis is essential to understand the practical impacts for Ireland.

The Commission’s proposals also bring substantial changes in the context of CAP governance and delivery. As I have previously mentioned, the traditional Pillar 1 and Pillar 2 framework is replaced with a single consolidated policy within the NRPPs. This offers member states increased flexibility to design schemes suited to their national circumstances, but it also raises questions about implementation and policy coherence. Ireland continues to stress the importance of ensuring that CAP-specific provisions are maintained in order that farmers, fishers and rural communities can rely on predictable and stable support.

In terms of measures, the proposals envisage increased targeting of payments, the provision of support in environment and climate priority areas such as climate change, water resilience, soil health and biodiversity, and the consolidation of eco-schemes and other agri-environmental measures. The detailed implications of these changes for Irish farmers and rural communities are undergoing careful analysis, particularly given differences in farm structures and regional needs.

It is important to note that the Commission’s proposals are the starting point of a lengthy negotiation process, which will include detailed line-by-line negotiations involving the European Parliament and the Commission. Ireland’s negotiating priorities are clear. We want a CAP that is straightforward and workable for farmers, flexible enough to reflect national circumstances, balanced across economic, social and environmental dimensions and adequately funded to deliver competitiveness, sustainability and climate objectives. The Minister, Deputy Heydon, will continue to engage actively with the European Commission and fellow EU Ministers to ensure that Ireland’s priorities are fully understood and reflected. While Ireland will chair the Council in the second half of 2026, the focus remains on advancing the discussions constructively, maintaining the CAP's integrity and securing the best possible outcomes for Irish agriculture and rural communities.

The Commission’s proposals represent a significant challenge for Ireland. The shift from the familiar pillar structure to the integrated NRPP framework, the reduction in Ireland’s ring-fenced allocation and the complexity of conditionalities and co-financing rules present difficulties at a time when the focus needs to be on modernising CAP governance, streamlining delivery, and ensuring that the policy continues to effectively support farmers, rural communities, and the broader European objectives of sustainability, food security and economic vitality. Ireland will continue to engage proactively throughout this process to safeguard our national interests and to ensure a CAP that works effectively for our farmers and rural communities.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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I propose that each member will have six minutes and then we will have have the opportunity to keep going around. Deputies Aird and Cooney are offering. We will go to Deputy Aird.

William Aird (Laois, Fine Gael)
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I echo the sentiments expressed earlier about the problem that is affecting turkeys. I do not know the people in Carlow, but I know the work that would have gone into in minding and looking after those birds. A policy decision will probably be made to have all turkeys housed. I hope there will be adequate compensation for everyone involved.

I thank our guests for joining us. I will ask my questions one by one. What is the Department's target outcome in respect of the negotiations on this issue? Is it to retain the two-pillar system entirely or is it to achieve partial ring-fencing within the umbrella fund?

Mr. Paul Savage:

In short, the target is to secure adequate ring-fenced EU funding. That has been the target from the start in terms of the overall outcome. We want to make sure that we have adequate EU funding across the board and that it is ring-fenced from a CAP point of view, that we keep, in an overall sense, a fairly simple and workable system for farmers if we can in the overall sense, that we have flexibility for ourselves at member state level in terms of scheme design and that we achieve a balance between economic, environmental and social sustainability.

William Aird (Laois, Fine Gael)
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That is grand. What is the Government's position on potentially supporting an increased EU CAP budget, which would allow for properly funded Pillar 1 and Pillar 2 schemes?

Mr. Paul Savage:

As I said, we want to try to make sure that we have adequate EU funding. We want to maximise CAP funding within the overall discussions. The amount of CAP funding and funding for all the various headings in the MFF will obviously be decided in the context of those negotiations over the next year or more. We want to secure the maximum possible funding from a CAP perspective. There is an element of ring-fencing in the proposal. It is not quite what we would have asked for in terms of having it separate for the CAP, but there is a ring-fencing element involved. We want to explore further what exactly it will mean in terms of the overall outcome for us.

William Aird (Laois, Fine Gael)
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Livestock numbers have fallen year on year in Ireland, as the witnesses know. Some processing companies, particularly those involved in the meat sector, are turning down orders because they cannot guarantee supply. How does the Department intend to support productive agriculture in Ireland post 2028?

Mr. Paul Savage:

In a general sense - and this is probably a very general reply - in supporting agriculture the key here for us is to be able to maintain the full toolbox of measures we have currently within the current CAP strategic plan. That range of measures covers direct income support, agri-environment and other areas, including on-farm investment. We want to be able to maintain that toolbox to the maximum extent we can and have flexibility at member state level so we can deploy that toolbox as effectively as we need to and in accordance with our national circumstances.

William Aird (Laois, Fine Gael)
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Can the Department guarantee farmers that livestock numbers will not fall further? Five years ago, the Department was telling us it would not happen but look at what is after happening in the past five years.

Mr. Paul Savage:

Here today, I cannot guarantee the Deputy anything in terms of where livestock numbers might go. Livestock numbers are falling in any event as part of a reprofiling. This is happening even on the suckler side where we have seen numbers falling in any event. I really do not know-----

William Aird (Laois, Fine Gael)
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That is because they would not make money.

Mr. Paul Savage:

I do not know where that is going to go in the future but from the Department and Minister's point of view, we want to be able to put in place the kinds of measures that are necessary to support the ongoing development of the sector and to make sure it is competitive and sustainable in the long term.

William Aird (Laois, Fine Gael)
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Has the Department estimated the likely financial impact on Irish farmers and the Exchequer should the CAP plans proceed in 2028?

Mr. Paul Savage:

We are looking at precisely those potential implications right now. As I mentioned, there is a decrease in the overall allocation we have seen so far, in terms of Ireland's allocation under the CAP for the period post-2027. We are looking at an €8.16 billion allocation within the current proposal, compared to €10.7 billion as it was in the current multi-annual funding framework, MFF, from 2021 to 2027. It is not a straightforward comparison because there are some elements that are within the NRPP structure and the CAP structure, so we have to tease out how that is going to work in the longer term. From our point of view, we want to try to maximise the funding, obviously, and make sure that, in the negotiation around this compatibility, or complementarity, between CAP and the NRPP, we get the best possible outcome for Ireland. Whether that is through the ring-fenced CAP funding or through the use of additional funds from the NRPP to put into CAP, we will be exploring every possible opportunity for ourselves in terms of increasing the allocation and being able to support the sector more effectively in the future.

William Aird (Laois, Fine Gael)
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We hear all sorts of anecdotes about who supports us and who does not. Is Mr. Savage able to indicate which EU member states most closely align with the views of the Irish Government? How is the Department co-ordinating with them to oppose this single fund model? This is fierce important. Will Mr. Savage answer that, please?

Mr. Paul Savage:

There are two things. In terms of those member states most closely aligned, it is probably fair to say that almost all member states have concerns and questions around the proposal around the MFF and, in particular, around this idea of integrating the CAP into that bigger NRPP framework, the more global NRPP framework. There is a lot of concern across a large number of member states, including Ireland, about how that is going to work in practice, what it means for funding across the various measures, what it means for implementation, how we govern that, and what the different rules are that might apply depending on the mix of CAP funding and NRPP funding, where there could be different conditionality rules and different co-financing rates. The concern is felt across most member states. Most member states would also have the view that anything related to the CAP should be dealt with within the CAP regulation to the maximum extent possible and within the AGRIFISH Council.

William Aird (Laois, Fine Gael)
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What Mr. Savage is saying to me, in a nutshell, is that most countries support us.

Mr. Paul Savage:

It is the start of a process right now but at this point, where member states have given their views on the proposals, it is clear that they all have concerns around the structure of this proposal, or the vast majority of them have concerns. There is a range of questions people have on how this might work in practice. We are co-ordinating with other member states and engaging with them through the various working groups that are looking at the proposals in Brussels. The Minister is doing the same at Council level and with his EU counterparts. We are continuing to engage with people on that and that engagement has shown that there is a lot of common reaction among member states to what is being proposed.

Joe Cooney (Clare, Fine Gael)
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I thank the witnesses for coming in. In its discussions with the European Commission and its counterparts in other member states, how strongly has the Department advised opposition to the renationalisation of agriculture spending? Has Ireland aligned with like-minded countries to defend a properly funded CAP? Which other EU member states are we aligned with?

Mr. Paul Savage:

The question on renationalisation really gets to the point about the CAP allocation within the NRPP envelope. As I mentioned, Ireland and a lot of other member states have the same issue with the approach here, not just in terms of the overall CAP funding that has been allocated in the context of the NRP plans but also in terms of the practicalities of how that is going to work. The Minister has been keen to emphasise that we wanted to have a separate CAP fund and to have maximum flexibility for the use of that fund in member states. We have been trying to explore what this proposal means in terms of the amount of flexibility member states will have, the complementarity of what is in the dedicated ring-fenced CAP fund and what might be possible from the rest of the NRPP fund. That will inform our view on whether it is possible to be able to potentially increase the budget that is available but also to be able to make sure we can implement all of the measures we want to implement and extend what we have been doing over the last while in terms of the toolbox that is available to us as far as investments and the environment are concerned as well. It is less a case of renationalisation and more a case of trying to get clarity around how that ring-fenced CAP will function within that wider NRPP framework.

Joe Cooney (Clare, Fine Gael)
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Have any efficiencies been identified within the current capital administration system that could be improved upon to ensure there is no reduction in the payments farmers receive? If there is less money for farmers, will this be balanced by asking them to do less or will they continue to be asked to do more for less money?

Mr. Paul Savage:

In terms of efficiencies in the current system, there are complexities around how things are done. Some of the requirements that farmers have to comply with can be onerous in the context of complying with the regulations. There is also a level of ambition in the current CAP strategic plan that brings its own complications, requirements and standards that have to be kept. From our point of view, we have been looking at efficiency in the current system and we are doing that on an ongoing basis. We have already started to look at how we can improve the way schemes are implemented for the next CAP in two or three years' time.

In the overall sense, the CAP proposal put forward by the Commission allows us the possibility to use all of those measures, as I said earlier, and to continue with those measures. It allows us the flexibility to look at efficiencies and at how we might do that better than maybe is the case at the moment. There are a number of elements to the proposals on which we will have detailed discussions because a number of them are mandatory and may or may not be suitable for all member states. That will feature in the conversation over the next months.

From our point of view, we would be happy enough that the content of the proposal contains the kind of toolbox we think we need and which will allow us to make our processes more efficient as well. At the end of the day, there is a clear intention here from the Commission to make sure we have a strong reporting and budgeting framework in place as well. In addition to the MFF regulation and the CAP regulation, there is also a performance regulation that imposes obligations on member states to make sure we are able to report on and monitor performance. We want to be able to do that in a way that provides the maximum efficiency in spending our money while, at the same time, reducing the burden on individual farmers.

Joe Cooney (Clare, Fine Gael)
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How does the proposed renationalisation of CAP affect the way payments are made to Irish farmers and their access to supports? What risk does this change pose as regards ensuring a level playing field across the EU member states? Is the Department planning to conduct an impact assessment of what the proposed changes would mean for Irish farmers and rural communities, particularly the possible change from the two-pillar structure?

Mr. Paul Savage:

That impact assessment is currently being conducted. We are analysing the content of the regulations. There are a number of questions that we and a lot of other member states have around the proposed structure, including how the CAP fits within that wider NRPP structure. The Deputy talked about access to payments and the general administrative system. We want to tease out exactly that point. Are there implications for us, from a governance point of view, in how we organise the schemes, how we monitor and how we report on our performance? Are there issues in terms of drawdown of funding? For instance, it might be straightforward to draw down the CAP funding from the ring-fenced allocation in the NRPP but if we move other money in from the NRPP to go in with the CAP to increase our expenditure, that may result in complications around how we go about making payments. We do not know exactly yet because we are not sure of what flexibility we have in that regard.

There are things we want to tease out. It does have the potential to make things more complicated in terms of processing payments because there would be that more horizontal structure across various funds, including the CAP.

What we want to get the bottom of is whether there is a way to make that more straightforward, simple and streamlined and ensure it does not impose an additional burden for us in the Department or make it any more difficult for farmers to get access to payments. That is an analysis that is ongoing.

Joe Cooney (Clare, Fine Gael)
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It is important that those issues would be ironed out before anything happened, in the interest of farmers.

Mr. Paul Savage:

It is fair to say at the moment, even in the early stages of the negotiations and the discussion at EU level, that a lot of the attention is focused on this point. It is the principle of the interaction of the CAP side of things with that broader NRP framework. How exactly is that going to work out? What are the questions there that we have? How is that likely to be resolved? In a way, there is a feeling that until we get those questions resolved - quite fundamental questions in terms of the structure - we cannot go on and get into the detail of the specific proposals on the CAP side because every time we look at a particular element in the CAP regulation, if it has an element that has to do with the NRP over the broader structure, then we have an issue. There is uncertainty at the moment. We need to resolve that issue so we can get on and do the detail on the CAP regulation itself.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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I thank the witnesses for coming in. I spoke to the Minister earlier about the turkey farm in Carlow. In England and the Six Counties, the regulation whereby all poultry will be housed is coming in tomorrow because they have had a couple of cases there recently. The Minister had a 3 km security zone on that, but that came in on 1 November and things have ramped up since that. When I spoke to the Minister earlier, I asked him for that housing order to be put in place. That is now done and it will come into play next week. I also asked for an adequate compensation packet for poultry farmers and businesses that are affected, like Fota Wildlife Park. They are losing €120,000 per week. There are a lot of jobs at stake in these kinds of places.

On the CAP, when is the deadline? When is the last day for having our input on it? What kind of engagement is the Department having with them? Is there much room for movement? The biggest problem or the issue that farmers have with it is that there is what was known as the two-pillar CAP. There was a little bit more security there. The issue with this is that sectors like the defence industry, border management, migration and internal security are all captured in the one pot. That is the bit that farmers have an issue with. They are afraid of how that money will be broken down. How each member state intends to use the supports that are there will be up to them. What is intended? Can we at least give farmers some kind of security to say that what percentage we aim to use for defence or whatever that is not farm related? That needs to be there. They need to understand that, for example, 5% of this is going to be used for that and definitely no more. When is the last date that we have for this?

Mr. Paul Savage:

The natural deadline for this is the fact that the current MFF runs out at the end of 2027. At Council level, the preference will be to get the new MFF and the framework agreed as soon as possible. The expectations at this stage are that it is likely to take until the end of 2026 or probably into the first half of 2027 before that is achieved. We just have to wait and see how that goes. Over the past couple of reforms, the MFF package would have been agreed something like five months before it came into effect in the previous round of reform and maybe ten months in the reform before that, which was seven years previously. Typically, that is the order of proximity to the provisions coming into place. It is expected to run until the end of 2026 or early 2027. Obviously, negotiating processes take time and have to evolve in accordance with the different positions of the different players in that, whether it is within the Council or between the Council, the Parliament and the Commission as well.

On whether there is much room for movement, we are at the very start of the process. There is always room for movement. I have been involved in previous reforms and the end product was very different in many ways from what the Commission had originally proposed. There is probably scope for movement. At this point, it is a case of all member states giving their initial reactions to what the Commission has proposed. That is the process that people have been going through over the past while. As I mentioned, a lot of clarity has been sought by member states around the new structure that has been proposed because it is a departure. The Deputy referenced the move from the two-pillar structure to this more integrated framework. That is a major departure from previously. As I mentioned earlier, that is taking a lot of time at the moment in terms of the early stages to resolve what exactly is planned there, how those different funds fit together, what the rules will be, what the reality of the implementation will be and what the impact of that will be on the CAP and other schemes. There will be a little bit of exploring of how that is going work at the start before we get into the real meat of the negotiations on the sectoral proposals.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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Ireland is very different from a lot of other countries. I would not like to see it being just one rule for everybody. Ireland needs to have a package that reflects what it needs, not what Europe thinks Ireland needs. At the moment, it is everything. Europe is coming down on us all, whether it is derogations, the Mercosur deal or the CAP budget. It seems to be so much of it so quickly. We need this CAP budget to work for Ireland and for what farmers need. They do not need the defence bit of it. That is the biggest issue there.

Mr. Paul Savage:

On the point the Deputy made about the two-pillar CAP now going into one and the concern that causes among farmers about whether that will affect payments, etc., there is the overall picture of the comparison with the current MFF framework. Again, however, our efforts will be focused on trying to maximise the CAP funding through whatever route we can do that-----

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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For farming.

Mr. Paul Savage:

Yes exactly, for farming. As I said, we have the scope to move money, for instance, from that wider NRPP fund of €11.4 billion into the CAP basket. We are a bit limited in what we can do there because there are requirements that have to be met in terms of cohesion and other areas that have to have expenditure as well. We need to be clear about what that means exactly. How much could we move? What would it mean for the kinds of structures we put in place then to both administer the schemes and report on performance as well because there could be different rules associated with those? The bottom line from our point of view is that we want to try make sure that CAP funding is maximised and that we try to continue the suite of measures that we have in the current CSP.

On the Deputy's point around the flexibility and Ireland's particular circumstances, a key focus of the Minister's discussions on these issues with other member states and European institutions is that we want that flexibility. Most member states would say that they want to have the flexibility to adapt and apply measures to suit their national circumstances. That is what we want to do as well. Although the CAP regulation in particular has a lot of a mandatory stuff in there at the moment - there is a lot of "shall" in there about what should be done - the kinds of measures that are proposed in the CAP are welcome in an overall sense because they allow us to continue the existing range of measures in the toolbox we have. Nevertheless, a lot of them are mandatory and do not give a whole lot of flexibility to member states. That is probably something that will be explored over the next period as we go through the regulation.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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I thank the witnesses for coming in. I wish to get clarity on something from Mr. Savage. He is saying that, as it stands, there is a lack of funding of between 20% and 24% compared with the previous CAP. Is that correct?

Mr. Paul Savage:

Yes.

When you read through the document, there is talk about moneys being put towards the environment, climate and biodiversity. When did that come into CAP? The reason for CAP was to reduce the price of food and make it accessible for people living and working in cities. We have now gone on to a new venture of putting more layers on top of the farmer under biodiversity, climate and the environment. Why are we allowing that? Why are the officials from the different countries not making it clear that this was the reason CAP was brought in under MacSharry? Why are we constantly moving the goalposts? There is no extra money; it is 24% less.

Mr. Paul Savage:

To pick up on a couple of elements of that, the shift towards an environmental component in CAP was certainly subsequent to MacSharry but it happened probably 20 years ago with the first rural development programme we had, when we had our the first agri-environment programme. It is not so much that the goalposts have been changing over the past number of years but to secure sufficient money for the CAP budget in the overall budgetary negotiations at an EU-level, there has been increasing pressure to basically meet and achieve environmental requirements. There is a lot more environmental conditionality now around how the EU budget is discussed at EU level. All member states and the Commission have signed up to environmental targets over the medium and longer term. A large part of the justification for the ongoing level of the CAP budget is around the need to incorporate environmental objectives, and not just competitiveness or supporting farm incomes, but also to look at environmental protections. As I said, that would have started probably 20 years, although I stand to be corrected on that in terms the first rural development programme, RDP, we put together. That has evolved since then. That kind of beach head, if you like, was established from an environmental perspective and has grown and become a bigger component of the CAP over the past number of years to the point that under the current CSP, we have moved on now into what is large expenditure of money on environmental and greening objectives and much more ambitious targets in terms of environmental outcomes. We had to do that to justify the amount of funding being made available at EU level. We are continuing a trajectory and process.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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The facts are we are talking about 24% less and putting more problems on top of farmers. The EU now seems to be more interested in guns and bombs than it is in a farmer producing food when one looks at what it is looking at at the moment. Area based income was mentioned. Is that areas of natural constraint, ANC? Can Mr. Savage explain that? Is the LEADER ring-fenced? Given my understanding of the new CAP, and from listening to Mr. Savage's people, am I correct that it is proposed that entitlements will be gone and it will be on a per hectare basis?

Mr. Paul Savage:

The areas of natural constraint are covered in the regulation as one of those areas covered as far as income support is concerned. The area based income support scheme and the ANC are included in the suite of measures. LEADER is not part of the ring-fenced allocation at the moment.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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It is not part of it.

Mr. Paul Savage:

No, the ring-fenced allocation-----

Michael Fitzmaurice (Roscommon-Galway, Independent)
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I picked it up that it was.

Mr. Paul Savage:

No, what I said was that with the exception of LEADER, ACRES and the EU schools scheme, the other measures are included in the allocation.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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LEADER is not ring-fenced.

Mr. Paul Savage:

LEADER is not ring-fenced, no.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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We are a net contributor to Europe. We are giving more money to Europe than what we are getting back as a country. That is a fact. Let people not think that we are getting soft money out of Europe. It is our money we are getting back but less of it, to be quite frank about it. Will Mr. Savage tell me if it possible, as Deputy Cooney mentioned earlier, to have efficiencies when we will end up with 20% less of a budget? There is talk about helping young farmers more. They need help; I do not deny that. However, if we are talking about 20% less of a budget, how do we help young farmers, get more women into farming and indeed get more people into farming because the problems are mounting? Will Mr. Savage elaborate on the proposal in regard to pensioners, in that by 2032 they will have to decide on one or other? Am I reading that proposal correctly?

Mr. Paul Savage:

I will take those points one by one. The Deputy asked about being a contributor to the EU and what we are getting back out of it. We are now one of the biggest net contributors to the EU. I think we are the ninth largest EU contributor. We are also a member state that gets most of its money back from the EU through the CAP. We are obviously trying to maximise our CAP funding in that context and will continue to do that.

In terms of the efficiencies with 20% less, we are trying to improve and make the provision of funds more efficient. We are not expected to do more but are expected to do things better and more efficiently and to target things more efficiently. From the Commission's point view, it is talking about more effectively targeting funding and more effectively integrating the CAP with other funds and activities that are going on at EU and national levels. We are being asked to do things more efficiently and to get better value for the money that is available.

On the 20% the Deputy mentioned, I did say earlier on that ring-fenced amount is 20% less than our current allocation under the MFF but we do have the possibility of availing of funds within the broader NRPP envelope to add to our CAP funding. There is still scope to significantly increase our CAP funding within that. There is a bit of a road to travel on that and there is a lot of clarification that has to be made at EU level in terms of how that will work but there is the scope to do that.

Regarding the Deputy's point about retirement by 2032, there is a specific provision which says that member states shall ensure that by 2032 at the latest applicants who reach retirement age determined by national law and who receive a retirement pension no longer receive support under that article of the regulation. That is a proposal in the regulation. It is part of a suite of proposals and will be subject to negotiation among members states over the next period of time. We will have to wait and see what happens in terms of where that goes as part of the negotiations but it is another element of what is a wider package as far as the Commission is concerned to try to support the sustainable development of the sector over the next period.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Does Mr. Savage envisage that we will know the road we are travelling on by the first quarter of 2027?

Mr. Paul Savage:

We should certainly have a much better picture than we have-----

Michael Fitzmaurice (Roscommon-Galway, Independent)
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By 2027.

Mr. Paul Savage:

The Deputy is talking about 18 months' time. Yes, we should-----

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Is it coming in at the end or the beginning of 2027?

Mr. Paul Savage:

The next framework commences on 1 January 2028. The negotiations-----

Michael Fitzmaurice (Roscommon-Galway, Independent)
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We need to know where we are going by end of 2027. However, by the first quarter of 2027 - in 18 months' time - Ireland will have the Presidency of the EU and I am sure the Department will be involved in that next year.

Mr. Paul Savage:

We will have it in the second half of next year.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Will the Department be focused on getting things nailed down to try to get the best deal for our farmers?

Mr. Paul Savage:

We will discharge our Presidency responsibilities as we have to. It will very much depend on the extent to which the proposal has progressed in the meantime. For those reasons I mentioned earlier around the complications and questions there at the moment, which are probably hampering quicker progress with the regulation currently, we will have to wait and see what happens with those questions. We will also have to wait and see what the view is not just in the Council but also on the part of the Parliament as it will be an important contributor to the debate and the timing of any resolution and to the nature of the work we will have to do during the Presidency. To be frank, at this point, that is very difficult to call. A simple answer to the Deputy's question is that we will have a much better idea by early 2027 than we do now on how we will be fixed for the period after the end of 2027.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I welcome the witnesses and thank them for coming in. As we know, the European Commission published its proposals for the MFF. These proposals involve massive changes in structure. Ireland will play a key role as an honest broker during our Presidency of the Council in the second half of next year. However, our priority has to be to ensure that the final CAP legislation reflects Ireland's concerns and provides certainty and stability for Irish farmers. We have to be selfish about this. Yes, we are part of the EU and, yes, there are 27 countries but our priority in this room is Ireland.

That has to be absolutely central to everything that happens here. The proposal is for a 20% cut on the previous CAP allocation, albeit with the two pillars replaced by just one. I am interested in hearing from the Department about new funding streams separate from the CAP that might help with the shortfall that is going to occur and support farmers in meeting their environmental responsibilities. If we could have a little chat about that, it would be great.

Mr. Paul Savage:

The 20% cut is clear in terms of the €8.1 billion versus the €10.7 billion. That is the allocation that has been ring-fenced within the NRPP framework I mentioned earlier. In terms of getting additional funding or new funding streams, there is the possibility of using some of the additional funding in that wider NRPP allocation. The wider NRPP allocation is €11.4 billion, of which €8.1 billion relates to the CAP.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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About 75%, or three quarters, is CAP, give or take.

Mr. Paul Savage:

Yes, it is about 76% overall. Outside of that, there is a balance of about €3.2 billion. We are under obligation as a result of the regulation or proposal that ring-fences 14% for social cohesion. It also provides for a number of other measures. More generally, however, we have flexibility to pull in additional funding from that wider NRPP allocation to augment and supplement CAP funding. That is an alternative stream that presents itself straightaway. Again, we just need to tease out the practicalities, the scope and how it would work in practice. We also need to consider whether it would create any issues for us in terms of governance or making payments to farmers within the CAP. We need to resolve those issues in any event. That is the first port of call in terms of additional funding.

In a general sense, we would then have to look at the scope for bringing in money from other headings of the MFF. The Commission's rationale behind proposing this kind of national framework was to try to get more coherence and complementarity across the various funds. Depending on the nature of the structure we end up with, we will have to look at how to achieve that complementarity or coherence across the various funds. That will be the first port of call.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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We are hearing a lot of talk in Europe about simplification and flexibility. We hear that future CAP reforms are likely to see these flexible frameworks that can adapt to local needs and challenges. What is our input from an Irish perspective in terms of making it easier to access the various different funding streams? There is a huge amount of bureaucracy and red tape. We now have an opportunity to simplify it. What are we going to do to simplify it from an Irish perspective?

Mr. Paul Savage:

There are two things there. One is the inputs into the negotiations in the first place. When we get on to negotiating with other member states on the content of the CAP regulation itself, everybody will be motivated by the need to achieve as much simplification as we can in the regulation for both member states and farmers. The first focus will be on how to finalise the regulation in a way that makes it as simple as possible to implement our schemes.

The second thing relates to later engagement with the Commission on implementing delegated Acts, which always follow the basic Acts. There will be a process of engagement to try to make sure that what is required as far as that secondary legislation is concerned does not impose too much of a burden on member states or farmers.

The third element will be ourselves. When we come to designing schemes and reviewing how we have done with our current CAP strategic plan and plan for the period beyond 2028, we need to think about how we can do these things as simply as possible while satisfying the requirements at EU level and being able to report, to justify our performance and to provide all the necessary information. How can we design schemes at national level that are as simple as possible, achieve the maximum ambition and also allow us to report on the outcomes and performance at the end of the day?

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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As a rural person living on the Kilkenny-Carlow border, I am very passionate about rural development. Will there be enhanced supports for rural development? Will that be a priority in the new CAP? I am talking about things like better infrastructure and services in rural areas. Will there be programmes to strengthen rural economies and to improve the quality of life for all residents?

I am conscious of time, so I will only ask one additional question.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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We will have another round.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I might not be here. If Mr. Savage will answer that last question for me, my final question is on the CAP post-2020 consultative committee. I know the Minister, Deputy Heydon, established this committee, which met for the first time on 7 July. How often has it met since its inception? It is to provide a forum to allow stakeholders to remain updated but how regularly does the committee meet?

Mr. Paul Savage:

I will go through the questions in the order they were asked. We have covered the-----

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Rural development was the first thing.

Mr. Paul Savage:

With regard to rural development, it is mainly about how we translate what was under the old Pillar 2 under the CAP strategic plan into the new arrangements under this integrated structure. A number of what would have been considered Pillar 2 schemes like on-farm investment and agri-environment schemes are now provided for within the overall ring-fenced amount for CAP in the NRPP, namely the €8.1 billion. As far as continuing on the elements of the Pillar 2 rural development schemes is concerned, we are now looking at it in a slightly different way but it is all provided for within the budget. The same questions arise as to whether we can secure additional funds from the wider NRPP allocation to add to the CAP strategic plan. When talking about complementarity or integration with other funds to provide better infrastructure or whatever it might be, you are again looking at how the CAP integrates with the other funds within the NRPP like cohesion funding and so on. One of the challenges we will have from the point of view of those national plans will be to make sure that we have coherence across the plan, that it is co-ordinated and that we are integrated in how we are trying to achieve objectives. There may be opportunities there. It is probably the most logical place to go. There will be opportunities there to continue to support rural areas and to provide for those types of infrastructure developments through the use of those other funds in addition to the purely farming-focused elements that will be in the CAP.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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My last question was on the consultative committee.

Mr. Paul Savage:

The consultative committee met for the first time in July. I think it met again in September. Another meeting is planned for later in November. That will continue to meet regularly over the course of the negotiations and beyond that when we start to look at the next CAP strategic plan.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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It has only met twice so far.

Mr. Paul Savage:

It has met twice so far and will be meeting for a third time later this month.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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What different stakeholders make up that committee? That is my final question.

Mr. Paul Savage:

It is a wide range of stakeholders, including farming organisations, industry organisations and environmental organisations. It is the full range of agriculture stakeholders.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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Would the Department be able to forward us a-----

Mr. Paul Savage:

I can send on the full list.

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Is having met twice enough, given the seriousness of CAP and its importance to the Irish economy and rural Ireland in particular? Should it not meet a little more regularly?

Mr. Paul Savage:

Again, the negotiations are at an early stage. By the time it-----

Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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If there have been two meetings, the first will have been about saying "Hello" and asking people how they are getting on and the second might have involved getting into something. We need a little bit of intensity here and a real focus on making sure that all stakeholders are engaged so that we present a united front to get the best possible CAP for farmers in Laois, Clare, Kilkenny, Carlow and all over the country as well as for rural economies right around the country. We need to be on the one page.

Mr. Paul Savage:

We will be meeting regularly. In effect, when the group meets this month, that will have been three times since July. If you allow for the holidays and all the rest, it is reasonably frequent. We are at a very early stage in negotiations. The Deputy can fully accept our bona fides in that regard. The last time we had a CAP consultative committee, we met 30 to 35 times in the space of a couple of years over the course of the last CAP development. We were very committed to having comprehensive stakeholder consultation and it will be the same this time around.

Joanne Collins (Sinn Fein)
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I have a very quick question. It is on the LEADER programme and, more importantly, the EU school scheme. The Department is saying these are going to be mandatory but the funding will not fall under CAP any more. It will have to be taken from the NRPP. What are we going to lose if we are taking it from another fund? Is the NRPP going to increase to provide for the school scheme?

Mr. Paul Savage:

As it stands at the moment, no. The general allocation we have in the NRPP is €11.4 billion. If it is decided to add funding to the CAP for the EU school scheme and the LEADER programme, it will come out of the broader pot. With regard to the overall allocation in the NRPP, in addition to the CAP and CFP allocations, we are obliged under regulation to allocate 14% of the fund to social cohesion. We also have to make sure that 43% of overall expenditure is devoted to environmental purposes.

There is scope within the rest of the money to decide what programmes or what additional funding we have. In a way, that funding is there and we can decide how we use it. Choices certainly need to be made as to the priorities for that funding and whether it goes into LEADER or other areas.

Joanne Collins (Sinn Fein)
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When it comes down to it, if we do not get the increase in CAP, we will need to see what priorities are there. Obviously, if the EU school scheme is mandatory, it will have to be kept regardless.

Mr. Paul Savage:

LEADER is also provided for in the regulations. That will dictate and influence the overall make-up of the overall NRPP fund.

Joanne Collins (Sinn Fein)
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That is all I needed to find out. Somebody else can have my time.

Paul Lawless (Mayo, Aontú)
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I thank the officials for coming in. My question is on the proposal for the pensioners. By 2032 somebody who is farming and receiving a pension must then decide whether they are going to receive the pension or receive CAP support payments. Is that the case? What analysis has been done on the viability for farmers in this cohort? Will we essentially see a whole generation of farmers wiped off the farm overnight? What is Mr. Savage's perspective on that?

Mr. Paul Savage:

I do not think it is a case of seeing a generation of farmers being wiped off the map overnight as such. As I said earlier, the provision is part of a suite of measures. A whole range of measures can be used here for member states to support generational renewal and the various other objectives of the CAP. The specific provision makes it very clear that upon reaching retirement age or availing of a national pension, payments would stop to those beneficiaries. However, that only relates to the direct support schemes. For instance, somebody could still continue to avail of environmental payments. What we are talking about here is the old pillar 1 payment which will not go to the recipient when they reach retirement age. In an overall sense, the Minister and the Department generally would share that concern over the implications of those proposals for farmers.

As I mentioned earlier, we are trying to make sure we have the maximum flexibility we can in order to satisfy all the different requirements of farmers at whatever age or whatever stage of their careers or development they are. We need to look at this as another proposal from the Commission that will enter into the negotiations and see how we get on with that in terms of the extent to which it features in the overall package at the end. Ultimately, it will be a case of member states deciding if those measures are appropriate to their national circumstances. From our point of view, we want to try to ensure we have as much flexibility as possible to adapt and apply the measures to our own circumstances.

Paul Lawless (Mayo, Aontú)
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The CAP will be reduced by about 20%. What will be sacrificed here? I understand there will be a focus on protection of young farmers and generational renewal. What else will be sacrificed? Obviously, farmers who are pensioners will feel the squeeze here. What other types of farmers will be affected?

Mr. Paul Savage:

I would not quite put it in terms of areas being sacrificed. At this stage it is the start of a long process. The Commission has outlined its intention and what it sees as the structure around the NRPPs and the allocation for CAP within that. Earlier I mentioned that although the €8.1 billion allocated to Ireland is an approximate reduction of 20% on the current MMF, there is also scope to move additional funds from that wider NRPP allocation into the CAP as well for member states. There is scope to increase the amount of funding going to CAP within the existing structure that is proposed by the Commission. We need to look at that and see how that will work and how it will fit with the broader targets that are there for the NRPP in terms of social cohesion and other things that are required as well. However, there is scope to add further funding to the CAP from that wider NRPP allocation.

At this point it is not a done deal that it is a 20% cut overall for CAP and that certain people or certain sections will be sacrificed. This is purely a proposal from the Commission as to how to fund this. There are possibilities for member states to secure additional funding for CAP, for instance from that wider NRPP allocation. We need to see what scope that provides us to do exactly that and what it will mean for how we go about implementing the CAP in practice.

Paul Lawless (Mayo, Aontú)
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How will the Irish Government go about drawing down those additional funds to make up the deficit? Is that within the gift of Ireland or is that something we would be trying to do through the Commission?

Mr. Paul Savage:

The workings, the mechanisms and the practicalities around that will obviously come out of the negotiations and will be nailed down later on. I would have thought that in a very simple way once it is a national plan, it is at member states' discretion to decide how they will allocate the plan subject to ring-fenced minimum amounts that are there. It will be up to member states to decide how they will use the broader allocation of the NRPP for their own purposes, depending on how they want to balance CAP versus social cohesion and other objectives they might also have. Member states, I think, will have that discretion at the end of the day. The mechanism and the precise way in which that will happen will emerge in more detail once we get through the negotiations.

Eileen Lynch (Fine Gael)
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I thank the officials for being with us today. I apologise for joining the meeting late and I apologise if these matters have already been covered.

The review of the CAP as per the announcement by the Commissioner in July is incredibly worrying, bearing in mind the decrease in funding and the eradication of pillar 1 and pillar 2 in that CAP formation. Is the funding allocated towards CAP part of the NRPP funding or is it separate? I am slightly unclear as to whether that is all within the same tranche. Mr. Savage's briefing indicated that it was from the NRPP which was my understanding but some of the Commission publications on it are not quite as clear.

We are at a very preliminary stage in negotiation. Our Minister, our MEPs and team Ireland have been very strong on this. Commissioner Hansen is quite strong on this. This is a massive change. Correspondence was sent last week from various leaders within the European Parliament outlining seven objections to this proposal for the NRPP and the way in which CAP is being dealt with. They have essentially indicated they may vote this down. Where does that leave us with the negotiations? It seems that the various group leaders within the Parliament are very strong and steady in saying to Ursula von der Leyen and the Commission, "You literally did what we told you not to do and if this is not amended, we will vote against it." If they end up voting against it how does that push back timelines? How does Mr. Savage envisage this developing?

Mr. Paul Savage:

On the first point on the funding, the CAP and the NRP, in essence the proposal is that a ring-fenced amount would be allocated to each member state in respect of CAP funding within the NRP allocation. In Ireland's case, we have a general allocation of €11.4 billion and within that we have a minimum ring-fenced amount of €8.1 billion for CAP. Therefore it is within the NRP. As I mentioned earlier, there is also scope to move other NRP funding, the balance of the €3.2 billion, subject to a few particular requirements or limitations. There is the possibility to move additional funding from that wider allocation into the CAP as well to increase the CAP funding. We are working on what that means, how that might work and what impact that might have for CAP governance and other things. That principle, as the Senator said, is correct. It is part of the overall €11.4 billion.

We are at a preliminary stage in the negotiations. The Senator mentioned the letter from the European Parliament. All of these regulations go through a process where the Council agrees its position, the European Parliament agrees its position and then trilogues take place later on with the Commission involved as well to reach an agreement. The Council is going through its process at the moment and looking at the regulations from the Commission on the MFF.

The Parliament is doing its work as well. Similarly, it has produced this letter, which states that it is not happy and that, effectively, it is threatening to reject it. That is a reflection of the political process that will go on over the next number of months in terms of the Council and the Parliament coming to their respective positions. In a way, the letter is probably just a demonstration of the fact that these negotiations are going to be difficult and complicated.

Eileen Lynch (Fine Gael)
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In terms of what has been spoken about so far, generational renewal is probably the biggest challenge currently facing agriculture. If we do not have farmers, we do not have farms. While the Department published its report on generational renewal in September and the European Commission published its report in the past two weeks, are those responsible for the CAP and the NRPP serious about doing anything when it comes to generational renewal? Even on the basis of the report published by the Department, the key actions and recommendations of which are commendable, it is obvious that the finance is not there for some of our proposals, particularly in relation to the schemes for people coming into farming and for those getting out. There is a caveat in that much of this was dependent on the CAP and the way in which it was developed. How does Mr. Savage see that unfolding? While we have a lovely report from the Department and another lovely report from the European Commission, there does not appear to be the commitment or finance behind them to put what is needed in place. There are so many challenges facing agriculture. However, generational renewal, the average age of our farmers and the difficulty for younger farmers in terms of accessing land, finance and labour are undoubtedly the biggest challenges facing our industry.

Mr. Paul Savage:

On young farmers, there are a lot of areas that the Commission has focused on in terms of what it wants to support. Obviously, generational renewal is one of those. There are a number of other areas as well. The relevant regulation is pretty strong in terms of what is being proposed as far as young farmers are concerned. It is essentially taking from A Vision for Agriculture and Food. It is obviously going to develop the generational renewal strategy that the Commission has published as well. There are three articles in the CAP regulation relating to young farmers and supports for young farmers. Of the 24 or 25 articles it contains, three relate to generational renewal. It is pretty strong in that sense.

It places an obligation on member states to put together a strategy on generational renewal. Each member state will have to produce such a strategy and show what it is doing in terms of feeding into the next CAP period and what components of that will be deployed domestically. There are a couple of provisions in relation to installation aid and the strategy on generational renewal. There is also a starter pack for young farmers whereby members states will essentially be asked be in a position to provide information to farmers around the various supports that are available and that are specifically targeted at young farmers, whether that is in the context of on-farm investment, direct payments or whatever. There is a significant effort being made to try to pull all of that together, namely the generational renewal strategy and the components in the regulation to follow it up.

Our commission on generational renewal has submitted its report. An implementation group is being established to follow-up on that. Member states will be required to produce this generational renewal strategy in the context of the new CAP and the work that we will do on foot of the Commission's report will feed into our generational renewal strategy and we will then put that starter pack and put that strategy together in accordance with the requirements under the regulation.

The Senator is correct. Funding is key. We want to try to ensure that those measures are adequately funded. From our point of view, key to all this is having the maximum flexibility for member states to decide what is the best option, what is the best balance that we can achieve in terms of funding. Also key are the vehicles through which that funding is deployed, namely whether it is by means of traditional Pillar 1 or Pillar 2 measures or other measures. Having the flexibility to decide how that is deployed will be important for Ireland and for other member states.

Eileen Lynch (Fine Gael)
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I thank Mr. Savage.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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I have a couple of quick questions. Our current CAP allocation stands at €10.7 billion. There will now be a ring-fenced allocation of €8.16 billion. That is within a general allocation of €11.4 billion. What areas are competing for the remaining €3.2 billion? In that context, I note the option of funding LEADER. Other schemes are competing for it. What other interests competing for that money?

Mr. Paul Savage:

I will take those one by one. As the Cathaoirleach mentioned, €8.162 billion is the allocation for the CAP. There is also €54 million provided for under the CFP. Then we have social climate funding of €500 million. We have a migration, security and home affairs fund of €300 million as well. In the context of social cohesion and social objectives, 14% of the fund is supposed to be allocated for those. The total amount in that regard is €488 million. That leaves an unallocated proportion of €2.7 billion. It is up to member states to decide how to go about allocating the unallocated portion. The flexibility will be there, as I said earlier, in terms of maybe moving money to the CAP or to carry out other elements.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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That flexibility is to allocate it within each of the headings Mr. Savage outlined.

Mr. Paul Savage:

Yes, across the various headings provided for in the NRPP. There is also a requirement that 25% of money that is non-CAP related has to be kept back for crises or for flexibility around particular measures that might have to be introduced over the period of the programme. That is a further element that we will have to comply with. In an overall sense, however, there is still a very reasonable amount of money available to us. It is up to us to decide how that should be allocated. In other words, whether that goes to the CAP or otherwise.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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The general allocation is €11.4 billion. How was that figure arrived at? Why is it not bigger or smaller? Is it up for negotiation? Is it something the Department is contesting?

Mr. Paul Savage:

I am not exactly sure what mechanism was used to arrive at that amount. It might have been on the basis of GNI or another comparison across EU member states. I can check for the Cathaoirleach precisely what the mechanism for that was, but it is effectively an allocation for Ireland in accordance with the proportions that would be allocated to other member states on the basis of previous allocations but also on the basis of member state profiles and other criteria. We can share with the Cathaoirleach separately precisely how that was arrived at.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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There is flexibility on how the funding is allocated. Is it only in the non-CAP allocation, the national allocation, in respect of which that flexibility applies or is there flexibility in respect of the ring-fenced CAP fund?

Mr. Paul Savage:

Within the ring-fenced CAP fund, there is flexibility to the extent that the CAP regulation will dictate the kinds of measures that will be available at member state level. We have to negotiate the CAP regulation. That gets to the point we were talking about with regard to generational renewal, for instance, as to what we will do in relation to direct income supports, agri-environment schemes, etc. It will be up to member states to decide on how they are going to structure their CAP strategic plans within the overall funding allocation. There is flexibility in that sense. There is also flexibility around how we use the unallocated portion of the NRPP funding as well.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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To clarify an earlier point about the timeline in the context of when Ireland holds the Presidency in the second half of 2026, is it the aim that by there will be a clear roadmap in place early 2027 and that the Department is working towards implementing that on 1 January 2028?

Mr. Paul Savage:

The ideal outcome would be that this would be clear in early 2027 in order that what we would be working towards in 2028 would also be clear. That would mean that the new MMF, the new budget structure, would come into place from 1 January 2028, but then we would also have to look at whether or not the specific measures under the CAP would be possible to have in place by 1 January 2028. It will very much depend on how the negotiations go over the next period. Certainly, at EU level, the desire would be to have the negotiations concluded as early as possible in order that there is a good lead-in to the commencement of the new budgetary framework in January 2028.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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Mr. Savage set out Ireland's priorities for a CAP that would be:

... straightforward and workable for farmers, flexible enough to reflect national circumstances, balanced across economic, social and environmental dimensions and adequately funded to deliver competitiveness, sustainability and climate objectives.

That is the target the Department has set. Many farmers would be looking at the payments and feeling that there is quite a bit of red tape and rigidity involved.

I am trying to figure out whether there is an effort or ambition to reduce that red tape and, where there is flexibility and ways to streamline it, to make it more workable.

Mr. Paul Savage:

From our point of view, Ireland's point of view and other member states' point of view, there is always a desire to simplify, to the maximum extent possible, the implementation of the CAP and all the measures within the CAP. We can sometimes start out with the intention to have simplification but it does not always work out to the extent we would like. There is a constant learning process. In the last number of months we have been through another simplification assessment and simplification package that will feature as part of the discussion implicitly in the negotiations on this round of CAP reform and the MFF. From member states' perspective, the key thing will be to get flexibility to tailor measures to individual national circumstances and to have that understood at Commission level, in terms of how we report that back and monitor the progress, which lends itself towards increased simplification. As I mentioned earlier, there are a couple of dimensions to simplification. There are the regulations themselves and there are the detailed implementing and delegated Acts that will follow on from that in terms of how the Commission sees those regulations being implemented. Again, we want to make sure simplification is maintained through that process. At national level, when we come to develop our measures we need to make sure we are also making it as simple as possible for farmers. We are learning on that basis and on an ongoing basis through our pillar 1 and pillar 2 schemes at the moment.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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On the national plan, the idea is that we will know what percentage of the money has to be spent in what area. We will get an idea and they will give us some type of guideline on that. For example, Mr. Savage said there was 24% for one. It is then up to the Irish Government to put a plan together to spend the percentages of money in those areas and then that draft is sent on to Europe. We will be hoping to have that ready somewhere in the middle of 2027 or ideally the earlier half of 2027. That will go back and forth and Europe will basically decide. Even though it says each state will spend the money as it wishes, it is not really like that.

Mr. Paul Savage:

The way the process works is that we do have to go through an approval process in terms of our CAP strategic plan whatever plan we come up with, or our NRPP as it will potentially be. We will have to see what the format is the next time round. In terms of the expenditure of CAP money, if it is the same model as has been followed this time, the Commission does have a role in approving member states' plans. When we put the plan together, previously we would have been required to meet a number of objectives at EU level. We had to be able to demonstrate how we were going to achieve those objectives and the Commission would approve the plan on that basis. There is a requirement in one of the regulations that goes along with the package around performance monitoring and reporting to the Commission. There are requirements in there that the Commission will want to make sure have been provided for in our CAP strategic plan or in our NRPP next time around. There will be an approval process that will have to be gone through. Generally, however, while that process might give rise to some change in terms of the detail of an individual scheme or measure, the CAP strategic plan as a whole remains pretty much intact from the version we give the Commission to the one we get back. There are usually a few little changes or a few things the Commission might want to clarify but, in an overall sense, once we get the plan to the Commission, although there is a process to go through, generally we come to a reasonable conclusion and a reasonable agreement on that. It is a case of the Commission being satisfied, particularly when there is EU money being spent, that whatever the member state is proposing to do in the plan is consistent with the overall objectives of the regulation. From our point of view, we need to be able to demonstrate that the measures we are going to deploy are going to achieve that and that we have the performance and the monitoring framework in place to demonstrate that to the Commission.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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We do not want a cliff edge where it all comes at the last minute and there is toing and froing.

Mr. Paul Savage:

That is always a danger. The negotiations themselves, even on the regulations, will take time. The process would normally be that we have to get agreement between the three institutions on the regulations themselves. Member states then go away and use the regulations to inform the development of their plans. They then go through that approval process with the Commission before the plans are actually put in place. There are a couple rounds of activity. The time is very challenging now. If we are going to have schemes in place for 2028, the timeline is very challenging around getting agreement on the budget first, getting the sectoral agreement on CAP and others, and then putting the plan together to get that approved by the Commission.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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I understand this came out on 16 July. Somebody else was challenging Mr. Savage over how many meetings he has had. Having two meetings is probably adequate enough because it is one per month, realistically, and as he said, we have a bit to go yet and there is a lot to be ironed out. How is the money that is ring-fenced for the whole of Europe done? Is it done per hectare of land? Is it done per head? We could argue there are a hell of a lot more heads in this country now. How is it allocated? Is it area or is it per head of population?

Mr. Paul Savage:

There are a number of factors that go to the calculation on the allocation for individual member states and it reflects similar conditions or criteria across member states so there is a kind of objective measurement of what the situation is in each individual member state. However, I do not have that to hand in terms of what all the criteria are. I am happy to share that with the Deputy afterwards.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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I can imagine it is very complicated.

Mr. Paul Savage:

It is quite complicated. There are varying degrees of calculations that are involved. We can certainly share that with the committee.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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Regarding school lunches, was there ever a clause that it had to be all Irish ingredients? Obviously, with the money coming from Europe it can be whatever, but we can put clauses on that, can we not? Can we put in clauses to say the school meals have to use ingredients sourced from Ireland? Do we know anything on that?

Mr. Paul Savage:

Offhand, I am not exactly sure what the criteria of the provisions would be or the amount of flexibility. I am sure there is some discretion at member state level to apply certain criteria to the involvement of people in the school schemes.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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I would like to think that we are using Irish ingredients.

Mr. Paul Savage:

Yes. It may well happen in practice or people are encouraged to do so, but whether there is a specific requirement or provision in terms of participation in the schemes, I am not sure offhand. Again, I can clarify that and find out for the Deputy.

Natasha Newsome Drennan (Carlow-Kilkenny, Sinn Fein)
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It would be interesting to know. I thank Mr. Savage.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Under the present proposal, am I correct in saying that entitlements will disappear and it will be a per-hectare system? Is that correct, under the present proposal?

Mr. Paul Savage:

That does appear to be the case under the present proposal, yes. There is not any specific provision for entitlements in this proposal.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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If it is per hectare, what is going to happen for people who have a lease on farms and leased entitlements over a period? Is there not going to be a lot of uncertainty in the market from now on for those who have a lease for five years or seven years when they do not know what is going to come? They do not know what is going to happen in 2028. There is going to be a fear there and a bit of trepidation. Someone is not going to enter a ten-year lease because the entitlements could be gone in 2028.

Mr. Paul Savage:

Yes, they may well be. We will have to see what the potential impacts might be on the market or the everyday functioning of entitlements and transfer of entitlements in the meantime. I am not sure how people might react to that. Certainly, on the basis of what is contained in the proposal, there is not any provision for entitlements.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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I saw today a ten-year lease on a farm somewhere coming up and there will probably be entitlements on it.

My worry is people could be sleepwalking into something. It is how it is all going to materialise in Europe. The Department does not have a crystal ball that will tell it how it will be in three years' time. I am fearful farmers will sleepwalk into a ten-year lease and then it could all change. Is the Department thinking about going around the country and explaining what is on the table at the moment? It is not the finished product but it would be to make farmers aware. A lot of farmers do not know there is a proposal that if you are pension age, it is either one or the other, and it is going to be entitlements. That is the proposal at the moment. We are not saying that is going to happen but the proposal is to go to a per hectare basis and there will be a 24% cut to the overall budget. The Department has to see what it can do on that. A lot of farmers are not aware of what is going on. I am afraid they may sign up to something in the next year or two that they might regret for the rest of the ten-year lease.

Mr. Paul Savage:

That is probably best dealt with in our engagement with stakeholders. The Deputy asked if we will be doing meetings around the country. We will see how we structure the engagement.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Even if something could be sent to farmers on the present proposal so no one can turn around say they did not know and they have signed a lease for ten years and their entitlements are gone.

Mr. Paul Savage:

We are engaging on these issues with the CAP consultative committee we mentioned earlier, which met for the first time in July and again in September. It has all the farming organisations and other relevant stakeholders on it. It will meet again before the end of this month. That is the primary forum in which we share and exchange with people around what it is in the proposals from the Commission and get people's feedback and views. That will continue to be a regular feature of engagement with stakeholders over the next period. We can look at refining that or tailoring the engagement with stakeholders more widely. We will try to get agreement from the stakeholder consultative committee on what the best structure might be to engage more widely with farmers and other stakeholders around the detail of the regulations. At the moment, we are at an early phase where we exchange with people and explain what is in the regulations and get initial reactions. There would be scope to adapt and tailor our engagement with stakeholders accordingly as we go. We can get feedback as it stands from people on the kinds of measures the Deputy mentioned.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Am I correct in saying the pot the officials spoke about is about €1.6 billion a year?

Mr. Paul Savage:

Is that in terms of direct payments and Pillar 2 payments?

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Yes.

Mr. Paul Savage:

Altogether, it is €1.6 billion or so.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Is it fair to say that a cut to that of between 20% and 24% will amount to between €320 million and €360 million?

Mr. Paul Savage:

That is in terms of the proposal. It is just the proposal.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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I understand that fully. I am cautioning that part of it. On the other money from this other pocket we are talking about, I do not understand that side of it. Is this coming into a fund everyone will be pulling out of and it is basically whoever the best fighter is gets the most out of it?

Mr. Paul Savage:

That might be putting it too simply but at the end of the day, the NRPP provides for this general allocation for member states.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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What is the NRPP?

Mr. Paul Savage:

The national regional partnership plans. The fund is provided for and there is a ring-fenced amount for CAP. There will have to be a debate if that structure remains in place and unchanged at the end of negotiations, notwithstanding some of the difficulties surrounding it and the questions member states have. If that were to survive the process, then we would be at a point where nationally we would have to decide, with the ring-fenced allocation for CAP, what is the scope, for instance, for bringing more money in from the wider NRPP allocation, what that means in terms of the overall balance across the various funds and how we ensure we can maximise the increase we can get for CAP and then make sure the CAP's integration with other funds is managed appropriately and to the maximum benefit. There would be a process, no doubt.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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I think we have been giving between €130 million and €150 million out of the Department of agriculture to overseas aid every five years. Is that fair to say? I presume the Department will look at funds like that because if we are going to shaft our own farmers, we are hardly going to be sending money out of the country.

Mr. Paul Savage:

I am not going to speculate on how the Department might spend its money in the future or where cuts, or otherwise, might be made to fund different measures. We will work within the confines of what we can as far as the allocation is concerned from the EU budget.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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What is the process? There is toing and froing over and back between all countries. Is it the Ministers who will decide the budget or what more will come? When will there be an indication that we are making progress? Is it Spain that is in charge at the moment? Who is pushing this? Does Ireland have an opportunity when we are the head of the EU for six months to try to drive this on? Some of them have gone mad on the climate craic. They want us to sign up to everything that we are going to be carbon neutral by 2040. I think Spain is trying to get that over the line. It will be one of the things they will be shouting about. Will it be a Government decision that we will try to focus and get this sorted and over the line while we have the Presidency? Is it not a good opportunity for a country that is very reliant on agriculture? It would be in our own interest, when we have the ball in our court and all the people coming over to us for once, to put the others into a corner and try to get this over the line as well as we can, as fast as we can. Is that the thinking within the Department?

Mr. Paul Savage:

This is probably more of a Government perspective rather than just the Department because the negotiations on the budget are led by the Department of Finance and the Department of foreign affairs jointly.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Are they?

Mr. Paul Savage:

They are.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Is that on the agriculture budget?

Mr. Paul Savage:

It is on the overall budget. We have an input to those negotiations in what the outcome might be for the agriculture proportion but the negotiations on the overall budget are led jointly by the Departments of Finance and foreign affairs, in co-operation with the Department of the Taoiseach and with input from all of the relevant Departments, as appropriate, including us. The process is what one might call horizontal because it looks at a range of headings and funding streams within the overall budget. That central co-ordination by the Departments of Finance and foreign affairs means it goes through the committee of permanent representatives, COREPER, in Brussels at EU level, then to the General Affairs Council and, ultimately, it feeds through to the European Council, which is Heads of State. It then agrees finally on conclusions, which we hope will be around in late 2026 or early 2027. That is the process and how it will happen at EU level.

From the point of view of the Irish Presidency, if we are in a position to get it across the line, as the Deputy said, we will do that but we will do it in the context of our Presidency role, being an honest broker and trying to get a solution that satisfies all member states, in the very same way we did back in 2013, which was the last time we had the Presidency. We achieved agreement on the budgetary framework as well as agreement on the CAP package at that time. If it falls to us during our Presidency, then we will be ready to bring that across the line. That will very much depend on the progress in negations over the next nine months or so before our Presidency and how much progress the Danes make. The Danes are in the seat at the moment. It will be the Cypriots in the first half of next year. We will wait and see at what point the negotiation is at and if it is at a ripe enough stage, we can then stake it across the line in our Presidency.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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In relation to the changes in the proposals at the moment, I am looking at this with face value. There seems to be a shift away from food production or doing things fairly good. It seems to be a shift and that it will no longer be an entitlement. Farmers had entitlements, which were a property right and were classed as such. If someone passed away and they did not have their will made and had not said "I bequeath everything I own", the entitlements went back to the national reserve because they were classed as a property right.

Going by the proposal the EU is doing at the moment, it is a property right that it is trying to extinguish, but I would query that. Every one of us, as public representatives, is dealing with cases of people who have unfortunately passed away. Some people have it put in their will, while others have not. If they have it in their will, it is a right that is going to someone else, which is interesting. Other countries might not have that, but we have it, and it might be complicated. It looks to me like we are moving away totally on the new CAP, and it is more about frogs and the environment than about food. It is about climate and the environment rather than food.

Mr. Paul Savage:

If the Deputy is asking my opinion on that, I can only give my opinion. The reality, as I mentioned earlier, is that the CAP has evolved over the last 20 or 30 years into a policy that does not just focus on the provision of food, competitiveness or income support, but also now focuses on environmental sustainability, the need to achieve our climate ambitions, biodiversity ambitions and other things. The CAP has evolved into a policy that is aimed at all three of those elements of sustainability, including economic sustainability, social sustainability and environmental sustainability. We are in an evolutionary process that has resulted in more demands on farmers from an environmental perspective, but that is because of the nature of the climate and biodiversity crisis we are facing. The nature of the questions at EU level about what we should be spending our money on is becoming more pointed.

It is fair to say that at EU level, we are trying to satisfy all those objectives. We are trying to have that economic sustainability to support farmers and to provide income support to support activity in rural areas. We are also trying to make sure that we can achieve environmental sustainability. The regulatory proposal here continues that suite of measures and that balance across those different components, as it has within the current CAP regulation. It evolves them further and talks about integrating in a bigger way the traditional Pillar 1 and Pillar 2 approach. From an environmental point of view, last time we had this green architecture where we had Pillar 1 with conditionality, ecosystem services and eco schemes, and then Pillar 2 added another layer of environmental ambition with ACRES, relating to environmental achievement. That is still a component of the overall regulation this time, except it has been pulled into the same €8.1 billion fund, but there is still a concentration on trying to further evolve and develop that green architecture further, and for us to be able to report to the EU on our achievements as far as environmental sustainability is concerned. I would not say it is a complete move away from food production, competitiveness or income support for farmers, but it is a more nuanced policy, because we have to achieve far more objectives because of environmental sustainability.

As I mentioned earlier, above all the level of EU funding that is going into the CAP has increasingly been reliant, over the past number of years, on the environmental sustainability and ambition of spending in agriculture, because all areas of EU spending have had to make that adjustment and evolution to a more environmentally focused approach.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Mr. Savage is talking about environmental concerns. In fairness to ACRES, there have never been more farmers taken into a scheme than the last scheme. Am I right in saying the State funding that?

Mr. Paul Savage:

Is that ACRES?

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Yes.

Mr. Paul Savage:

It is co-funded by the State and the EU.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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What is the percentage each way?

Mr. Paul Savage:

I think it is 60% national funding and 40% EU funding.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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Okay, so €250 million a year is split 60-40.

Mr. Paul Savage:

We pay from national funds upfront and then recoup that fund from the EU.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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All right. I thank Mr. Savage.

Aindrias Moynihan (Cork North-West, Fianna Fail)
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Much ground was covered there with detailed questions. On behalf of the committee, I thank the officials from the Department for their contributions and answers. I do not have any further questions, nor do members.