Dan Neville (Limerick West, Fine Gael)
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I welcome the opportunity to raise this issue and call on the Minister for Agriculture, Fisheries and Food, Deputy Mary Coughlan, to honour her contract with farmers on the rural environment protection scheme, REPS. The Minister must ensure that suspended REPS payments are made as soon as possible, clearly explain what is happening at the Department of Agriculture, Fisheries and Food and what she is doing to remedy the matter. Farmers are clear that the contract they entered into with the Department of Agriculture, Fisheries and Food included the payment of REPS 2 and REPS 3 as an advanced payment.

The depth of feeling relating to this issue was demonstrated at the meeting at the offices of the Department of Agriculture, Fisheries and Food in Limerick on Sunday. This meeting was in support of the sit-in protest by farmer Donal O'Brien who was on hunger and thirst strike because he was promised his payment and informed he would be receiving payment but at the end of last week was told he would not receive it. Mr. O'Brien was taken to hospital tonight as a result of his experience. We wish him a speedy recovery to health.

The pay freeze on the REPS payment follows hot on the heels of the suspension of the farm improvement scheme. The announcement that no advance payments will be made for REPS 4 leaves farmers in the lurch when they need to make vital capital investments. Thousands of farmers are being hit by the freeze in REPS payments. Many of these farmers will have taken out loans to invest in essential infrastructure on their farms. This creates a serious cash flow problem while they await the arrival of their funds.

The way in which the situation has been handled by the Minister and her Department has also left a lot to be desired, with farmers being left completely in the dark. The Minister must put in a strong argument for a solution to this problem but she must also inform farmers as to what is happening and when they can expect the release of REPS 2 and REPS 3 payments.

The Minister states that the problem lies with the EU. However I believe it is within the control of the Department of Finance, which is limiting the amount of payments. The Minister needs to clarify this situation as a matter of urgency and needs to make a more concerted effort to communicate in an open manner with farmers, to reassure them in light of the forthcoming CAP health check and to quell uncertainty in the sector.

John Cregan (Limerick West, Fianna Fail)
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I am pleased to have the opportunity to raise this important matter and to join my colleagues on the opposite side of the House who have also seen fit to raise this matter on the Adjournment. This is a difficult issue for many farmers in County Limerick who are members of REPS and for the 50,000 farmers throughout the country who have joined the scheme in goodwill.

As chairman of the Fianna Fáil policy group on the environment, I am very aware of the excellent benefits this scheme can bring to our environment and what it has achieved since its inception in the early 1990s. Under the scheme farmers do their bit for the environment and in return are given their payment.

This has always been a front-loaded scheme with an advance payment and this is what farmers signed up to. They go to their REPS planner, put their plan in place, pay him and then expend some money on the work in the farm. They were given payment in advance and this method worked very well. Ireland is the only country in Europe to have had the benefit of an advanced front-loaded REPS. It is widely recognised we have the best REPS in Europe. In the best of good faith, farmers signed the contract for REPS 2 and REPS 3 with the Department of Agriculture, Fisheries and Food acting for the EU. It is only fair and proper that this commitment should be honoured.

The Minister is currently in a very difficult situation. We are very fortunate to have a Minister who is the best Minister for Agriculture that ever represented this country.

Dan Neville (Limerick West, Fine Gael)
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What about Austin Deasy and Mark Clinton?

John Cregan (Limerick West, Fianna Fail)
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She has tremendous influence in Europe. She has worked very hard for the past number of days and nights and has been in constant contact with Commissioner Fischer Boel and with the Commission. I am quite confident that the Minister will bring a satisfactory conclusion if given a little space.

I do not agree that the Minister or the Department of Finance have caused the problem. The scheme is a European scheme and we must respect its terms and conditions. It was introduced as an advance payment scheme and it is time this was recognised. I have no difficulty with REPS 4. If we are to have a scheme that is not an advance payment scheme, people will be aware of this fact when they join. REPS 2 and REPS 3 were advance payment schemes. I commend the Minister on her efforts and encourage her to bring a solution to the problem.

I also wish Donal O'Brien well. He is in hospital as he has been on hunger strike on the issue in County Limerick.

Charlie O'Connor (Dublin South West, Fianna Fail)
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Allow speakers to continue without interruption.

Andrew Doyle (Wicklow, Fine Gael)
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I know that when Deputy O'Connor is Acting Chairman I will be given the time I require.

Charlie O'Connor (Dublin South West, Fianna Fail)
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I will do my best.

Andrew Doyle (Wicklow, Fine Gael)
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I wish to clarify some points. It is not just REPS participants whose scheme anniversary falls on 1 January that are affected. I know this because I sought clarification about my own REPS plan, the anniversary date of which was 1 November. I sent in my full compliance on 3 December and I am informed it was not processed because of a backlog of work, due in part to an official being on long-term sick leave who was not replaced. Mairead McGuinness, MEP, seems to have had early indications that the EU did not direct that suspension of payments for REPS 2 and REPS 3 should take place. I accept that REPS 4 is a different matter. I ask for clarification on this issue.

I raised this matter under Standing Order 32 this morning. I pointed out that the Lisbon treaty seeks the reaffirmation of the power of our own Parliament and our own national Government policy. It has been the policy of the Government to front-load the payments in order to allow people to invest. If it is the case that the EU has insisted on a change in this rule, it will be difficult to sell this concept of autonomy for Irish Government policy in the run-up to the referendum on the Lisbon treaty.

REPS has been a flagship EU environmental scheme. Farmers have come to regard it as a means of investing in an upgrade of their waste facilities to bring their farm practice into line with EU standards and there have been tangible results. However, this has come at a cost which has involved borrowing to provide buildings, waste storage facilities, new habitat zones, destocking, hedgerows and other aspects of REPS. The annual REPS payment has been regarded as a method of funding and servicing this commitment and this is now in jeopardy. Many people regard cash flow as the issue. In light of the suggestion that all EU schemes are to be based on environmental aspects, it is a question of whether the budget is running out.

Martin Ferris (Kerry North, Sinn Fein)
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It is a very drastic measure for a man to go on hunger and thirst strike in order to obtain his rights and entitlements. At 7 a.m. this morning I was in Limerick city outside the office of the Department of Agriculture, Fisheries and Food where Donal O'Brien, a farmer, was on a hunger and thirst strike. I am pleased to say he has ended his thirst strike, which is a great relief to many people who support everything for which this man stands.

Previous speakers have made many of the relevant points. A total of 6,000 farmers are affected by this stand-off between Europe and the Department. The spin we are being given is that the Minister, Deputy Coughlan, is negotiating with the EU Commissioner to try to have the payments made. The implication of the spin is that they have changed the regulation but this is not the case. As Deputy Doyle said, Mairead McGuinness, MEP, outlined in the newspaper today that this is entirely a matter for the Department and there is no change in the regulation. The regulation is different for REPS 4, but not for REPS 2 and REPS 3.

The Government is hiding behind an inaccuracy. The benefits of REPS 2 and REPS 3 are to be seen in what they have achieved for the environment and for the weaker sector in the agricultural community. The schemes have been a means of helping people to stay on the land and invest in it. It should be remembered that farming is seasonal and farmers depend on payments being made consistently at the agreed time. Farmers budget around those payments. A total of 6,000 farmers are currently affected and this will grow over the next weeks or months. Many more people will be affected by the stand-off in the same way as Donal O'Brien and the 6,000 farmers. I urge the Minister of State to prompt the Department to release the funding immediately. If this matter is not addressed promptly, more difficulties will be created and it will escalate. I fear for people as many of those involved in the agricultural sector on this island are in a desperate situation. The Minister and the Minister of State are from rural constituencies and have the same sense of this as all of us.

Charlie O'Connor (Dublin South West, Fianna Fail)
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I ask the Deputy to conclude as the time has expired.

Martin Ferris (Kerry North, Sinn Fein)
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The Acting Chairman is also from rural Ireland as he is from Tallaght.

P J Sheehan (Cork South West, Fine Gael)
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Will the Acting Chairman allow me to say one word?

Dan Neville (Limerick West, Fine Gael)
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Do.

Charlie O'Connor (Dublin South West, Fianna Fail)
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The order of the day——

Dan Neville (Limerick West, Fine Gael)
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The Acting Chairman is not the Ceann Comhairle, Deputy O'Donoghue. Let him off.

John Browne (Wexford, Fianna Fail)
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I will allow Deputy Sheehan to use some of my time.

Charlie O'Connor (Dublin South West, Fianna Fail)
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The Minister of State will concede half a minute.

P J Sheehan (Cork South West, Fine Gael)
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I join other Members in urging the Minister of State to take immediate steps to rectify this injustice to the 6,000 farmers who are trapped.

Dan Neville (Limerick West, Fine Gael)
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Hear, hear.

P J Sheehan (Cork South West, Fine Gael)
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Does the Minister of State want to have them working in vineyards and giving them nothing, while their counterparts in the REPS 4 scheme will be paid in a fortnight's time? I ask the Minister of State to have compassion for the 6,000 farmers waiting for funding to pay their bills.

Dan Neville (Limerick West, Fine Gael)
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Hear, hear.

Charlie O'Connor (Dublin South West, Fianna Fail)
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I must bring Deputy Sheehan to Tallaght to visit my farmers.

P J Sheehan (Cork South West, Fine Gael)
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Does the Acting Chairman have a big farm in Tallaght?

John Browne (Wexford, Fianna Fail)
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I hope Deputy Sheehan appreciates that I gave him a minute or two of my time.. I thank Deputies Neville, Cregan, Doyle and Ferris for raising this issue.

Brendan Howlin (Wexford, Labour)
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And Deputy Sheehan.

John Browne (Wexford, Fianna Fail)
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I apologise — and Deputy Sheehan. I join them in wishing Mr. O'Brien a speedy recovery to full health.

Like Deputies on all sides of the House, I regard REPS as one of the most successful farming schemes we have ever operated. Since its introduction in 1994, it has delivered more than €2 billion in payments to farmers. However, it is about much more than money. It is a scheme which has brought many benefits to the environment and to society as a whole. It enables farmers to remain viable while farming in ways compatible with protecting and improving the environment, safeguarding biodiversity and contributing to better water quality. The importance of REPS is given the strongest recognition in the programme for Government, with the commitment to further promote the benefits of the scheme and achieve a participation rate of 70,000 farmers.

For generations, farmers and farm families have been the keepers of Ireland's rural landscape and rural environment. Modern farmers are extremely conscious of their responsibility for this heritage and they want to maintain it and pass it on to future generations. REPS helps them to do this. The payments may be made directly to farmers, but the benefits are for everyone.

We are now into REPS 4. When the Minister for Agriculture, Fisheries and Food, Deputy Coughlan, launched the new scheme last August she pointed to the fact that €3 billion had been provided for it over the period of the new rural development programme, which runs to 2013. The Government's commitment to REPS is demonstrated by the fact that this includes €1.6 billion of national funds, almost double the national provision in the seven years to 2006.

On this point, I want to take this opportunity to state clearly that no issue arises with regard to the availability of funds for REPS this year. My Department's Vote contains money to meet all commitments arising under REPS, and the first payments will go out this week to REPS 4 farmers under contracts which commenced in 2007. In line with the social partnership agreement, Towards 2016, all payment rates in REPS 4 are increased by 17% compared to REPS 3. This means that the average REPS farmer will receive €7,220 per year in REPS 4, while a farmer with 55 hectares will qualify for more than €10,000.

REPS 4 will help to protect the rural landscape, increase biodiversity and improve water quality. It will encourage farmers to enhance the environment through a range of actions. These include a reduction in the use of fertilisers and pesticides, which will contribute to lower greenhouse gas emissions as well as improved water quality. The scheme also helps to maintain existing hedgerows and promotes the planting of new ones. Some REPS farmers will grow crops to provide food for wild birds. Others will preserve traditional breeds of animals.

When REPS 3, the previous version of the scheme, closed to new entrants in December 2006 more than 59,000 farmers were taking part. We expect these numbers to grow under REPS 4. I am particularly glad to be able to state that, as we have a derogation for more intensive farmers under the nitrates regulations, they are eligible to apply for REPS for the first time.

Since REPS was first introduced in 1994, it has been our practice to pay the farmer at the start of each year of the five-year contract.

Brendan Howlin (Wexford, Labour)
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Who was in Government in 1994?

John Browne (Wexford, Fianna Fail)
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This was in recognition of the reality that farmers may have to make capital investments and spend money throughout their contracts to bring their farms up to REPS standards. It is a system which proved attractive to farmers and worked well.

REPS 4 operates under different EU regulations from previous versions of the scheme. If applied to the letter, these would mean a departure from the existing practice of paying the farmer at the start of each contract year. My officials explained this situation to the farming organisations and, with their encouragement, looked for the Commission's agreement to continue the existing system.

It was at this point, early in January, that the Commission - out of the blue - suggested we had been wrong all along to pay at the start of the REPS contract year. We were astounded by this, because the Commission had been fully aware of the way we operated. It had been commented on during successive visits by auditors from the Commission and the Court of Auditors. Never before had anyone suggested that we should not be doing this.

At that stage in January, we had already paid more than €6 million to farmers in REPS. Once we knew the Commission was taking this line, we had to put further payments on hold while we set about trying to persuade it to take a different view. This decision was taken extremely reluctantly and there is no question of the Department taking a decision unilaterally. We were aware it would come as bad news to farmers who were expecting their payments. However, when schemes are operated in ways not in line with EU regulations the Commission can, and does, impose disallowances. Ultimately, the taxpayer has to foot the bill. This was a risk we could not take.

Department officials have met the Commission twice in recent weeks about this situation. They argued strongly that the practice of paying at the start of the contract year is well established and one of which the Commission is well aware. When Commissioner Fischer Boel was in Dublin two weeks ago to attend the annual general meeting of the IFA, the Minister for Agriculture, Fisheries and Food, Deputy Coughlan, took the opportunity to make the same points strongly and directly to her. The Minister emphasised the seriousness with which she regards the situation. The Minister and her officials continue to press for a quick and pragmatic resolution to the issue and high-level contacts continue on a daily basis.

We do not welcome this situation. We are making it clear to the Commissioner and her officials that there is a real risk of damaging farmers' confidence in what we can describe without contradiction as the most successful agri-environmental measure in all of Europe. I appreciate that farmers are suffering by being caught up in this uncertainty but I can assure all concerned that the Minister and her officials are pressing the Commission for a quick resolution so that prompt payments can continue to be made as before.