Eugene Murphy (Roscommon-Galway, Fianna Fail) | Oireachtas source

I am somewhat alarmed by the Government's lack of imagination and half-hearted approach to Brexit, one of the biggest challenges this state has ever faced. Numerous reports have indicated that a hard Brexit will have profound negative implications for Ireland and that the knock-on effects will be most keenly felt in rural Ireland, in particular. Farmers, agri-businesses and suppliers throughout my constituency of Roscommon-Galway are worried about the potentially devastating consequences of a hard Brexit. Agriculture is one of the main priorities in rural counties such as Roscommon and Galway. Reduced access to the UK market, owing to tariff barriers, a diminution in the value of the UK market through increased imports from lower cost countries and a potential reduction in the CAP budget post-Brexit present significant threats to the future growth and development of the Irish farming and food sectors. In a scenario where there is a 10% reduction in the CAP budget and a reduction in UK food prices resulting from reduced tariffs on imports, Teagasc has estimated that farm incomes could fall by a whopping 26%. When applied to the national farm income figure of €2.5 billion in 2016, this would mean a reduction in farm incomes of almost €700 million. I am sure the Minister for Enterprise, Trade and Innovation, Deputy Mary Mitchell O'Connor, and the Minister of State, Deputy Helen McEntee, will agree that this would have a crippling effect on rural Ireland where farm families are already struggling to survive. Beef farmers are particularly worried as cuts of 37% to cattle farm incomes would gravely undermine the viability of suckler beef production in Ireland and substantially reduce the size of the 1 million suckler cow herd. This would jeopardise the livelihoods of the 100,000 farmers involved in livestock and beef production, resulting in thousands of job losses and the loss of export earnings.

An analysis undertaken by the Economic and Social Research Institute, ESRI, of the impact of a hard Brexit on trade flows - with World Trade Organization trading rules applying following the UK exit - showed a potential reduction in EU trade to the United Kingdom of over 60% in dairy products and a whopping 85% in meat products. In an Irish context, the value of meat exports to the United Kingdom would fall by €1.5 billion, while the value of dairy exports could fall by over €600 million. A strong CAP budget post-2020 is critical for farm incomes, farm output and wider economic activity. A reduction in spending power in Irish agriculture, arising from a cut in direct payments to farmers, would have a significant and negative knock-on impact on the demand for goods and services in the rural economy.

While the Article 50 trigger letter and draft guidelines issued by the European Council make reference to Ireland, which is welcome, this is only the beginning of a complex process. The Government must step up to the mark and do more to protect Ireland's interests. It must ensure Ireland's distinct concerns will not fall off the negotiations agenda in the months and years ahead. Furthermore, it must provide support for Irish businesses and industries so as to insulate them from the instability caused by Brexit, to help them to diversify into new markets and to ready themselves for a new trading environment. It is clear that it is not business as usual. As stated by my colleagues, there is need to have a Brexit Minister to co-ordinate the required across departmental and cross sectoral response. We call on the Government to advocate for a trade agreement that would be as close as possible to what we currently have. Some 14% of Ireland's total exports go to the United Kingdom. A trade regime based on WTO tariffs would be a disastrous outcome for Ireland. An ESRI report published in November 2016 indicated that a WTO scenario would result in the level of GDP being 3.8% below what it otherwise would have been in a no-Brexit scenario. We need the Government to seek what it otherwise would have been in a no-Brexit scenario. We need it to seek clarity on the future trading relationship as soon as is feasibly possible in order to provide certainty and stability, which are essential for Irish business, Ijobs and the economy.

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