Tuesday, 3 December 2013
Topical Issue Debate
Common Agricultural Policy Negotiations
I thank the Minister of State for coming into the House. I am disappointed that his senior colleague is not here, but no doubt there is a good reason for that. I presume he is not in the country and if he is not, I fully accept that he cannot be here. However, it is a pity he is not here because we now face a huge crisis in farming. The last Pillar 2 funding for the period 2007-2013 amounted to €4.8 billion, between State funding and European funding. Pillar 2 funding has been co-funded, with 53% coming from the EU and 47% coming from the Government. Under the rules negotiated by the current Minister, the small print shows that the new Pillar 2 could be as little as €3 billion. That is a potentially huge 40% cut in funding.
This is amazingly poor negotiation by the Minister. When he was talking about the great job he was doing on the CAP, one would have thought that the Minister would have been to the forefront during these negotiations, ensuring that national governments could not get away without adequate co-funding of Pillar 2, especially since Pillar 1 is 100% European funded, and these are the big payments. Instead of that, the Minister has signed off on a deal that will cost European farmers dearly. Governments across Europe, including the Government in Ireland, can reduce their input even though the European Union input is down 11% already. On top of the 11% across the board cut in European money, we now have the potential for a huge further cut by reduced rates of co-funding. Put in simple terms, what was €4.8 billion the last time could end up being as little as €3 billion this time. It is very difficult to understand how this was negotiated without it being brought to the attention of farmers.
When the CAP was announced, the Minister said that the general rate of co-funding is 53%, that is to say, 53% from Europe and 47% from the Government. Of course he did not stress that the environmental payments can be as low as 25% and that these environmental payments - including the DAS, which is considered to be an environmental payment under European terms - amount to 90% of Pillar 2 in Ireland. When we add in the measures that can be funded as low as 20%, we are at the stage where around 94% of the payments can now be funded at a lower rate of 25%. There is huge concern now that the full enormity of the sell out of the farmers of Ireland by the Minister has become apparent.
I need an assurance from this Minister of State this afternoon that, notwithstanding the ability of this very poor agreement to allow national governments to reduce their contribution to farmers enormously, the Government will actually co-fund Pillar 2 at a rate of at least 47%, against 53% from the European Union.
I thank the Deputy for allowing me the opportunity to come in here and explain exactly where we are on this. I apologise for the absence of the Minister. The Deputy quite rightly pointed out that he was on other business. He is in Japan, where he has succeeded in opening up the trade for beef in that country, which is hugely welcome right across this country.
In June 2013, political agreement on CAP reform was achieved under the Irish Presidency. It was also hailed as a great success by all European Heads of State and the Commission. This agreement marked the first time that three main European institutions came together to agree the framework for the development of the European agriculture sector, which has enabled the sustainable development of the sector up to 2020 and beyond.
A key step in the implementation of the reformed Common Agricultural Policy will be the design and introduction of a new, rural development programme for the period 2014-2020. The development of a new rural programme under Pillar 2 will be a key support in enhancing the competitiveness of the agrifood sector, achieving more sustainable management of natural resources and ensuring a more balanced development of rural areas, which we all want and need. The new rural development programme will be based on the provisions of the draft regulation on support for rural development by the European Agricultural Fund for Rural Development. This draft regulation was originally published by the European Commission in October 2011. Discussions at Council working group level took place under the Polish, Danish, Cypriot and Irish Presidencies of the European Union prior to reaching a Common Position in June 2013.
While the draft regulation has not been formally adopted, its provisions represent the framework for the work carried out to date on the new rural development programme. It is expected that this programme will be formally adopted before the end of this year. The new programme must be based on six priority areas for rural development, as set out by the Commission. These priority areas are fostering knowledge transfer and innovation; enhancing competitiveness; promoting food chain organisation and risk management in agriculture; restoring, preserving and enhancing ecosystems; promoting resource efficiency and supporting the shift towards a low carbon and climate resilient economy; and promoting social inclusion, poverty reduction and economic development in rural areas. In addition, through addressing at least four of these six priority areas, the new rural development programme must also contribute to the cross-cutting teams of innovation, climate change and environment. The challenge in designing a new rural development programme is to take all of these considerations into account, while also ensuring that the measures chosen to form part of a new programme are clearly in line with the smart, green growth objectives of the Food Harvest 2020 strategy.
With the replies I am given sometimes, I do not know whether to cry or to laugh at the total effort to not answer a simple question. In the committee today, the Department statement highlighted that the draft rural development regulation refers to a general co-funding rate of 53%, but went on to clarify that not all measures within the rural development programme will be co-financed at that rate, as there will be a number of derogations from the general rate.
The impression given was that different rates would be applicable to perhaps 5% or 10% of measures. In fact, the derogations cover more than 90% of the spend, which means that fewer than 10% of measures will be eligible for the 53% rate. Since the Minister trumpeted his great achievements in Brussels in June, for which, we are repeatedly told, the whole world is grateful, the story was that there would be a general co-funding rate of 53%. That is bunkum. In reality, that rate applies to fewer than 10% of measures; for the other 90%, the applicable rate will be either 20% or 25%. Irish farmers are not grateful for that.
I am asking a simple question today. Can the Minister of State confirm whether it is the intention of the Government to co-fund the European money of €330 million per annum at a rate of 53%? If the Government chooses to hedge its bets the second time around, the logical conclusion must be that the intention is to avail of the very low co-funding rates, which were negotiated by the Minister in the full knowledge that his colleague, the Minister for Public Expenditure and Reform, would take advantage of them and, in so doing, take more money out of farmers' pockets. That will have a particular impact on people farming poor land, which is 75% of the land in this country, and those dependent on agri-environment schemes.
I assure the Deputy that no time or effort will be spared in negotiating for as much as can possibly be achieved in the coming months. Consultation is ongoing with all stakeholders. The Deputy should not believe everything he reads in the newspapers. To be clear, no decision has yet been made on these matters. As we speak, departmental officials are talking to colleagues in other Departments in an effort to maximise the funding we can obtain for rural development. It is important, moreover, that whatever funding we obtain we keep. The Government of which the Deputy was a member dropped the schemes it had negotiated halfway through their cycles, including the rural environment protection scheme, the young farmers' installation scheme, the early retirement scheme and the suckler cow and fallen cow schemes. We do not want to announce something that we cannot maintain. That is why we are engaged in a consultation process. Officials in every relevant Department are working with the farming organisations to ensure we have schemes that will assist people living in rural areas and ensure the agricultural industry can survive and prosper. An important element of this is the Leader programme, in which the Deputy has had a special interest for many years. The Minister is very supportive of the ongoing efforts to establish that scheme, together with the other schemes.
As I said, negotiations are ongoing and no decision has been made. I would greatly appreciate the Deputy's help in this regard. I hope he will propose ideas, which we will be happy to take into consideration. The Minister and I want to be constructive, as does the Department. We are receiving great support from many rural and farmers' organisations, including people in the Deputy's party. In fact, some of those people have advised us not to listen to what he is saying in regard to Pillars 1 and 2. Some of the Deputy's views are not going down too well with his own people and he would be well advised to check with members in constituencies such as Kilkenny and Wexford. When he brings that consultation to the table, we will be happy to listen to him.