Michael Moynihan (Cork North West, Fianna Fail)
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Question 4: To ask the Minister for Agriculture; Food and the Marine the status of changes to the disadvantaged areas scheme; the communication he has had with the EU Commission on this issue; the number of farmers affected; and if he will make a statement on the matter. [28712/12]

Simon Coveney (Cork South Central, Fine Gael)
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This question is about the disadvantaged areas scheme, DAS, about which there has been some confusion. It is important to point out that the changes relating to eligibility that we are applying to the disadvantaged areas scheme in order to make savings have not changed since budget day. We have debated some of these matters in the House previously. There appears to be a view that we have suddenly changed a number of things in the last few weeks. We have not. What I said on budget day last year is what we are trying to implement.

What I was trying to avoid was cutting the rates or the areas under which farmers could apply for a disadvantaged area payment. I did not want to reduce the income of people who are farming at reasonable stocking rates and keeping their stock for a reasonable amount of time during the year. I was anxious to make a distinction between farmers whose farms are fully in disadvantaged areas and those whose farms were only partly in disadvantaged areas, that is, farmers whose primary holding is outside a disadvantaged area but who are leasing or buying land in a disadvantaged area and drawing down funds. They are not in the same category as farmers whose full holding is in a disadvantaged area. In other words, we are trying to change the eligibility to make savings in as intelligent a way as possible in order to protect real and active farmers.

If some people are losing payments unfairly as a result of those changes, I am anxious to hear about it. We will put an appeals mechanism in place and I have been given assurances that it will be a swift mechanism that will give people a quick decision. I hope people will use it. We are trying to make a distinction by using last year as a reference year for trying to make a measurement of reasonable stocking rates in disadvantaged areas in respect of sheep, suckler herds and so forth. I spoke to farming organisations before making those decisions to get their reaction. I am not saying the farming organisations are responsible for the decisions, because they are not. I am responsible. However, I am anxious to outline the motivation for the decisions we took.

Finally, in the past when Ministers and previous Governments have had to make savings in the DAS, they simply reduced the area farmers could apply for or reduced the rate of payment. We wanted to do things in a more targeted way and change the scheme in a way that would protect farmers who are relying on and need DAS payments, and to try to make the distinction from other farmers who are in a different category. That was the motivation for what we are trying to do and that policy has been consistent since budget day last year.

Michael Moynihan (Cork North West, Fianna Fail)
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The Minister said there was some confusion but that the position remains the same as was stated in the budget. The Minister applied to the European Commission for its agreement to do what he proposed on budget day, particularly in respect of the retrospective basis on which he is increasing the stocking rate. Everywhere one receives very detailed cases for force majeure, based on hardship, illness, death and so forth, and there would be difficulties with that. We have been in contact with the Department to seek an appeal mechanism. This must be clarified. We understand what the Minister said in December and that there is a difficulty with getting approval from the EU Commission. It has a huge difficulty with the retrospective basis on which the Minister applied the increase in the livestock units and, indeed, in respect of the 80 km, about which I am not particularly concerned. However, with regard to the increase in the livestock unit to 0.3 and its retrospective basis, the information from the farming media and other people is that the European Commission has flatly refused to give its permission.

Simon Coveney (Cork South Central, Fine Gael)
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First, the Deputy should not believe everything he reads in the media. Second, when one makes a change to the criteria of any scheme, one must make an application to get approval for those changes because the funding comes through the European Commission. My Department is going through that process at present, which is perfectly normal. While letters are going back and forth to clarify questions and so on, it would not be true to state anyone has a huge problem with this proposal. From the correspondence I have seen to date, this is the kind of correspondence that happens when one makes changes to criteria within a scheme, whereby one makes a proposal, the Commission reverts with questions and one responds by answering those questions. This is the process through which the Department is going at present and there is nothing extraordinary about it.

Michael Moynihan (Cork North West, Fianna Fail)
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Is there not a huge difficulty with putting in place a retrospective basis for this scheme by using 2011 stocking densities to qualify for a 2012 scheme? As for productive farmers, I acknowledge at the outset that farming production must be increased and so on. However, people are living in great difficulty in respect of land constraint, peripheral regions, quality of land and so forth. They have lost the rural environment protection scheme, REPS. Moreover, the agri-environment options scheme, AEOS, is not being reopened this year and the disadvantaged areas scheme is coupled with that. These schemes were not just about farming but also provided environmental benefits.

Simon Coveney (Cork South Central, Fine Gael)
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That is the reason I am trying to protect the payments.

Michael Moynihan (Cork North West, Fianna Fail)
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Does the European Commission have a difficulty with the retrospective basis on which the Minister is applying this scheme?

Simon Coveney (Cork South Central, Fine Gael)
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First, it is important to be accurate in this Chamber. As I have stated clearly to the Deputy previously, I am hopeful a limited AEOS scheme will be opened in September. I acknowledge it will be limited and it primarily will be focused on Natura areas and on those farmers who farm in commonage areas. In respect of the disadvantaged areas scheme, DAS, the entire point of what the Department is trying to do is to try to protect the incomes of those to whom the Deputy has just referred, because people in disadvantaged areas need that income. They are limited in respect of the return they can get from the marketplace because of the limitations on productivity on their land, their soil or whatever. This is the reason I sought to try to protect the income of people who are farming in disadvantaged areas by changing the eligibility in such a way that people who are not farming fully in disadvantaged areas would not receive the same level of payment as those who are. This is a perfectly reasonable thing to do and I revert to the entire point of what I was trying to do. Unlike the previous Government, which simply applied cuts to everyone, I tried to differentiate between those who need the money most and those who do not and now I am being criticised for it. If people are getting a raw deal because of the payment or because of the change in eligibility I have made, I want them to use an appeals process and my Department will try to look at that in as generous a way as it can.

On the retrospective payment issue, people tell me all the time in respect of the 2014 reference year for the CAP, for example, that if one intends to set a reference year, one must set it in the past and not in the future because otherwise, everyone simply would change behaviour in the future. This is the reason I picked the most recent year in the past, 2011, to be the reference year. This is not about retrospective change but is about setting a reference year to distinguish between people who should be getting a full DAS payment and those who should not. Were one simply to change it for this year, everyone would simply have increased their stocking rate to have the bare minimum necessary to draw down a payment. The Department was trying to save money and to distinguish between those who should be getting a full payment and those who should not. If we have made mistakes in certain case studies and for certain people, they should use the appeals mechanism to enable the Department to look after them.