Michael Creed (Cork North West, Fine Gael) | Oireachtas source

I am in regular contact with the Commissioner, Mr. Phil Hogan, and my European counterparts in regard to maintaining a strong CAP budget post-2020 and my position on this issue is well known. I met the Commissioner most recently at the end of August and again re-iterated the need for a well-funded CAP.

Regarding the Commissioner, Mr. Günther Oettinger, and the Commission’s final reflection paper on the future of EU finances, published on 28 June 2017, I am keenly aware of the potential implications some of the proposals within this paper would have on future CAP funding. The paper contends that economic strength, sustainability, solidarity and security must be focal points for the EU finances of the future and that future budgets needs to be simpler and more efficient and flexible. This is a principle to which Ireland can subscribe.

However, the paper outlines five possible funding scenarios, ranging from continuing with the current reform agenda to radical redesign, with the consequential effects on EU expenditure and revenue. Some four of these scenarios point to a potential reduction in the CAP budget. The paper also refers to a number of options for managing a cut in CAP funding, including reductions in direct payments to farmers, the provision of farm supports only to those under special constraints, and a requirement for member states to co-fund direct payments, which currently are 100% EU funded.

Such proposals would have a significant adverse impact on the economic sustainability of farms or impose a significant additional burden on the Exchequer, especially given that many livestock farm incomes in Ireland would be negative without direct payments. The certainty and stability the direct payments provide to farmers cannot be underestimated, as has been evident during recent market crises. Cuts in CAP could also have a negative impact on efficiency and investment on farms, with knock-on impacts on food processing and associated sectors and the rural economy generally.

It is worth noting that the amount of CAP funding per member state for Pillar 1, direct payments, and Pillar 2, rural development, is fixed until 2020 in regulations of the Council and European Parliament. Any change to these figures will require a co-decided amendment to these regulations.

Additional information not given on the floor of the House

The Commission was expected to come forward with proposals for the new multi-annual financial framework for the period 2021-27 by 1 January 2018. However, due to Brexit and other pressures, this is not likely to happen now until mid-2018. While formal discussions on the multi-annual financial framework have yet to commence, I support the retention of a strong and well-funded CAP and my position on this matter has been articulated at official and political level and is well understood by the Commissioner, Mr. Hogan, my counterparts in other member states and in the Commission. I will be working hard with my European counterparts to ensure that the CAP budget post 2020 provides a solid and effective foundation for the continued development of the agrifood sector.

See this speech in context