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

I come from the southern part of County Cork, which is one of the dairy heartlands of the country. I have spoken to many dairy farmers about this issue. We need to be honest about a couple of things here. The superlevy is not a surprise. Farmers knew it was coming. Many farmers factored it in last year in the context of the price they were then being paid for milk. They calculated that they would have to pay some amount of superlevy in the context of their expansion plans. Many farmers who were being paid over 40 cent a litre last year, by the time bonuses are taken into account, factored in a superlevy fine of 28 cent a litre for some of the extra milk they were producing beyond quota. Obviously that is a much more difficult prospect now because milk prices have come back substantially since then. I recognise that. Of course there is an obligation on co-ops to work with dairy farmers who were expanding, investing and factoring in the cost of the superlevy, but are now under some pressure, to ensure they manage their cashflow in a way that makes sense for the repayments they have to make and the superlevy they have to accommodate over time. My understanding is that such arrangements are being reached within co-ops at the moment to ensure those farmers who are encountering difficulties have a plan to work those difficulties out within their co-ops.

Rather than telling people what they want to hear, I have to be honest with them. The deal we have now, which was outlined by the Commission and into which countries can buy if they want, involves a three-year interest-free staged payment. The Minister for Agriculture, Food and the Marine has to pick up the tab for financing that deal so that farmers can actually manage it on an interest-free basis. That goes way beyond what the Commission has ever done before in terms of facilitating a superlevy. I would have liked the Commission to have gone further. It has been suggested that months after this decision was made, we should fundamentally change it now just for Ireland. I do not see that happening without getting a significant number of countries to support it, which I do not think will happen at this late stage.

I suggest we should focus on the practicalities that are now facing farmers. They are trying to work through those financial practicalities with their co-ops to make sure nobody goes out of business.

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