Martin Ferris (Kerry North-West Limerick, Sinn Fein)
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To ask the Minister for Agriculture, Food and the Marine the amount of SFP and other Common Agricultural Policy payments that are paid to registered companies not directly involved in farm production; and if he will support the ending of such payments. [15061/13]

Simon Coveney (Cork South Central, Fine Gael)
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Payments are made under the various schemes implemented under the Common Agricultural Policy to eligible applicants who meet the provisions in the EU regulations governing the schemes. In the case of the single payment scheme, eligible applicants must meet all of the following criteria: they must declare eligible hectares as defined under the provisions of article 34 of Council Regulation EC/73/2009; they must carry out farming activity on their holdings; they must hold payment entitlements; and, if they want to benefit fully, they must declare an eligible hectare for each payment entitlement held.

For all types of transfer of entitlements to companies, the applicants must complete a transfer of entitlement application form, which must be supported by a copy of the Companies Registration Office printout to allow the Department to identify the directors of the company for signature purposes. In addition, a memorandum of articles of association must be included detailing that the business of farming is being carried out by the company. To proceed with the requested transfer, officials from my Department ensure that all forms are signed appropriately and that the business of the company includes farming. There are only a small number of companies in receipt of the single payment scheme in Ireland and the vast majority of these were established in recent years by individual farmers who wished to transfer the operation of their farming enterprises to limited companies.

In the case of the market support and on-farm investment schemes implemented by my Department, these measures routinely apply in an equal manner to both natural and legal persons, including companies. Accordingly, where an applicant satisfies the eligibility conditions set out in the measure concerned, my Department is obliged to issue payment to the eligible applicant.

For payments made to companies under EU-funded schemes, both fully and partially, I refer the Deputy to my Department’s website, where details of EU payments to all beneficiaries who are legal persons, including limited companies, are published in accordance with the provisions of Council Regulation EC/1290/2005. The relevant site is .

I think I know what the Deputy's question is getting at. He raises the question of whether we should allow companies to draw down very large payments while individual farmers are struggling and need every cent they get in single farm payments. I will expand on that in my reply to the Deputy's supplementary question.

Martin Ferris (Kerry North-West Limerick, Sinn Fein)
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I thank the Minister for his reply. I tabled this question because of the disproportionate amount of money paid to a small percentage of those who are entitled to payments. It underlines the unbalanced way in which payments are distributed. Over recent weeks we have heard derogatory remarks made about small producers, small family farms and so forth to the effect that they are not productive. Some farm organisations want to maintain the status quo but, according to the Minister's words and my own view, the single farm payment is not equitable or fair. As elected representatives we should try to ensure it is made more favourable for those in most need.

Michael Kitt (Galway East, Fianna Fail)
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A question, please.

Martin Ferris (Kerry North-West Limerick, Sinn Fein)
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Payments of over €500,000 to Larry Goodman's company and €680,000 to Abbott cannot be defended. At a previous Question Time the Minister expressed support for the capping of such payments at €100,000, but it now looks as if it will be €150,000. Did the Minister receive support from any other member state for this proposed cap? Did he push for it? Has he given any thought to the notion of flexibility towards a new model of payments? Will he come down in favour of another model for such payments?

Simon Coveney (Cork South Central, Fine Gael)
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I will come to the last question in a later reply. Back in 2007 there were 340 companies drawing down payments. There are now 435. It is true that many of these are a result of farmers coming together to set up a limited company to draw down payments on the transfer. There are larger companies also. The Deputy referred to the Irish Agricultural Development Company which is part of the Goodman group. It has a large beef herd and drawn down payments to which it is perfectly entitled. I do not think we should comment overly on individual cases because they are applying the rules of the system in place. However, we are changing this system with the Common Agricultural Policy reform process. Payments will be fairer and more equitable. The model I have advocated for the past 18 months will ensure that in the redistribution of direct and single farm payments, everyone will be moved to an average payment. However, this model will also limit the transfer in such a way that it does not put individual farmers out of business who rely heavily on their single farm payment, while at the same time significantly increasing payments to farmers who have historically low payments but want to become more productive. I will continue to advocate this policy because it is fair.

We achieved a significant victory at the Council of Ministers to get acceptance from the other 26 member states of this alternative model to the flat-rate, area-based model the Commission had proposed. We must go forward and reach a compromise position with the Commission which has a different view from mine, as well as the European Parliament which has a similar view to mine but wants to move further with redistribution. We will have to find before the end of June a way of compromising on a figure and method for redistribution.

Let us be clear. Redistribution is going to happen. The question is to what extent is it going to happen in terms of the amount of money involved and the pace of that redistribution. I have strongly advocated that we need to do this over time and limit the redistribution to ensure we keep our herd size and productivity intact, while assisting the farmers contributing most to the Food Harvest targets.

Martin Ferris (Kerry North-West Limerick, Sinn Fein)
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It is welcome that the Minister is moving towards redistribution. However, I am concerned that the fairness of the redistribution might be lost because of pressure being exerted by other interest groups. We need to keep as many small family farms in rural Ireland as we can. I would like to see the Minister's model that he has used in the negotiations. I hope it takes cognisance of the debate that has taken place politically in recent months to secure a viable income for smaller producers.

Simon Coveney (Cork South Central, Fine Gael)
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The Council has taken into account the debate that has been happening in rural Ireland. I am now trying to give the Government as many options as possible in terms of flexibility.

This is in order that when we conclude, hopefully by the end of June, a political agreement with the Commission, the European Parliament and the Council on what CAP reform will look like, we will have a series of options and flexibilities which we can decide on how best to use for Ireland in terms of taking the agri-food industry, agriculture and farming forward in a progressive way that helps people who need a leg-up, those on disadvantaged land who need support and that helps people who are planning significant expansion and growth to proceed through Pillar 1 money and rural development money. Both need to come hand-in-hand and they complement each other. Certainly, we will work on getting the maximum flexibilities in order that we can design a system for Ireland that suits agricultural production here. That will include a series of measures including the potential for coupling; the potential from switching money between Pillar 1 and Pillar 2; the potential for a redistributive payment, which has been discussed a good deal, or for an extra payment for the first 20 or 30 hectares; and the redistributive model that we have been discussing.

All these flexibilities are part of the discussion that we are trying to agree on at the moment. As part of this we will also be discussing an overall cap. I have said that I supported Deputy Ferris's suggestion several months ago that a cap of €100,000 would be appropriate in Ireland. We have no agreement on that because the view of the Council of Ministers was that €150,000 should be the figure. I am obliged to respect the strong majority decision there. Other countries will apply no cap, because it is voluntary. We will have to see what the discussions and debates with the Parliament and Commission result in before the end of June.