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

It is important to note that the Common Agricultural Policy has been designed to try to bring income balance to farmers also. This is one of the reasons we have direct payments. I remind the House that the average dairy farmer in Ireland receives a direct payment of €18,000 a year. That is the average payment. Some of the bigger guys receive much higher payments. Teagasc has predicted that the average annual income on dairy farms will drop from €64,000 or €65,000 to €34,000 next year. The €18,000 single farm payment becomes a much more important income support when there is such a significant decrease. We will be offering other supports such as disadvantaged area payments. New environmental schemes will be opening up. A new targeted agricultural modernisation scheme will be specifically tailored for farmers in the dairy sector who want to invest. Young farmers will receive 60% grant aid for this investment. There are, therefore, many supports available. The real challenge is in preparing the market for the dramatic price volatility we are seeing from last year to next year. We need to insulate and help farmers to hedge against this price volatility for the future. That is where Ireland can introduce new pricing models and new thinking, rather than relying on the Commission to do so. The Commission needs to be open to acting on dramatic price drops at European level, as I think it will be.

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