Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

DAS is never paid before the end of September. There is a reason for that. Legally, one cannot make a payment until one can prove that a farmer qualifies for it. One of the qualification criteria is that the farmer has to have had his animals for seven months. We are not even seven months into the year. I am being asked to give out payments to farmers before they even qualify. If I did that, the Commission would introduce a disallowance meaning we will not get further payments later on in the year. DAS is a slightly different category to single farm payments because it is a matching fund, as half of it comes from the Exchequer. Naturally, one would assume we could pay that part of the DAS payment now and worry about the rest later. That is not how it works. There are strict rules under which one can make payments. In order to make a payment legally, one must ensure the farmer qualifies and make the necessary inspections to ensure he is compliant.

If I start making payments early without those checks in place, when the Commission audits us, it will point out that we made payments inappropriately and we will get disallowances. In the UK disallowances have been in the hundreds of millions of euro while Denmark’s disallowances came to €110 million. Last year, Ireland’s disallowances came to less than €2 million out of €1.2 billion in payments.

That is how compliant we are. Deputy Naughten is correct that if farmers are not spreading fertiliser because they cannot afford to buy it due to lack of credit, that is a mad situation and we need to address it through the banking system and the credit available from co-operatives and merchants. We need to find a way to do that but that is why we have a banking system. If farmers know they will receive a cheque containing a DAS payment at the end of September and a cheque in the middle of October under the single payment scheme, they should be able to use the banking system, which should give them competitive credit rates during that period. Banks have told me they are happy to make credit available to farmers with no repayments required until the scheme payments come through in the autumn. We should be able to put that facility in place. My Department is not a bank and we would get ourselves into difficulty if we tried to advance payments without putting the necessary structures in place.

I will put in writing the reason we cannot access the solidarity fund for Deputy Ferris. I have pushed hard on that issue to try to get something out of it and it just has not been possible.

I take the point made by Deputy McHugh. Management plans are needed at national level and at individual farm level to prepare for next winter and we have to put them in place over the summer.

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