Mary Coughlan (Donegal South West, Fianna Fail)

I am keenly aware of the need to make available appropriate supports for small farmers. In this regard, small farmers benefit from all of the supports, within the legal framework of the European Union, administered by my Department. One of the areas where this is possible is the rural environment protection scheme. The latest version of the scheme was introduced in June 2004. In addition to an average increase of 28% in payment rates, payment of €200 per hectare is also provided for the first 20 hectares, €175 per hectare for the next 20 hectares and further payment digression thereafter.

Under the CAP Rural Development Plan 2000-2006, compensatory allowances payable in the disadvantaged areas moved from a payment per animal to a payment based on area. Under the area based scheme, farmers in the disadvantaged areas with a minimum stocking density of 0.15 livestock units per hectare can qualify for payment on up to 45 hectares of land. Approximately 99,800 farmers qualify for payments totalling €231 million annually. This represents an average payment of €2,315 compared with an average payment of €1,523 under the old headage schemes. The smaller farmer has benefited under the new scheme, which will continue in its present format for 2005 and 2006.

The EU Commission's proposal for the post-2006 rural development framework provides for the reclassification of disadvantaged areas. The suggested new methodology would be based on natural conditions, notably soil and climatic factors. The socioeconomic criteria taken into account to designate the current eligible areas will no longer apply. At meetings of the Council of Ministers, I have stressed that this is an extremely important and sensitive issue. Other member states have also adopted a similar position. I will continue to seek a solution that is equitable and in Ireland's interests. I cannot be definitive as to the shape of that solution, since negotiations are still in progress.

With regard to the dairy sector, under the milk quota restructuring programme which I announced before Christmas, small farmers again receive consideration, in that producers with a quota of less than 350,000 litres will be able to purchase twice the amount available to larger producers in the same co-operative area. Moreover, younger farmers with less than 350,000 litres will have priority access to a further 25% of the pool.

Additional information not given on the floor of the House.

Priority was given to applications from small scale producers under the milk quota appeals tribunal hardship scheme for 2004-05. Under the single payment scheme, there is provision for modulation whereby a reduction of up to 5% is made in each farmer's entitlement to fund certain rural development measures. However, this money will be refunded in respect of the first €5,000 of each farmer's single payment. The result is that up to 45% of Irish farmers — essentially those in the smaller category — will not be affected by modulation. In so far as it is possible, therefore, support is provided under my Department's schemes, for smaller farmers. Support is also available to eligible farmers under the farm assist scheme, administered by my colleague, the Minister for Social and Family Affairs.

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