Wednesday, 16 June 2021
Common Agricultural Policy: Statements
We are moving on to statements and questions and answers on the Common Agricultural Policy, CAP, negotiations. I call the Minister for Agriculture, Food and the Marine, Deputy McConalogue. The Minister has 20 minutes.
I welcome this opportunity to speak to the House regarding the ongoing CAP negotiations. Since 1962, the CAP has undergone several evolutions and, indeed, sometimes revolutionary changes concerning its scope and objectives. This long-standing policy began with the aim of supporting food production in Europe and I believe that aim is still every bit as valid today. The CAP has evolved since being formed and now plays a much wider role. Production supports have been replaced by decoupled payments and the introduction of cross-compliance, greening requirements and convergence have embedded environmental actions and the targeting of supports as part of the CAP. Today the CAP contributes to a broad range of objectives that are as much social as economic, but at its core remains the need to support our food producers – the farmers and their families.
We must be clear, however, that we are in the midst of another evolution of the CAP and we will see a different CAP to the one we saw before. The next CAP will have to meet challenges, namely, around having a greater climate ambition while still ensuring our world-class farmers can continue to feed the world in a safe and sustainable manner. Critically, the CAP must cater for the first principles: we need to continue to produce quality and sustainable food, for which there will be increasing demand. We must support farmers and rural communities and, while we are doing that, we also must ensure environmental sustainability. Enormous demands, therefore, are being placed on the new Common Agricultural Policy.
Ireland is the sustainable food capital of the world and we must not do anything that would stop our farmers from doing what they do best. As a country that is one of the most food-secure nations in the world, exporting 90% of all food produced, Ireland is not exporting a problem. We are exporting a solution of sustainable food production to more than 180 countries. In June 2018, the European Commission launched its proposals for the next Common Agricultural Policy with an increased focus on higher environmental and climate ambition. Ireland and Irish farmers should not be fazed by this ambition as we have led the way in our climate ambitions overall. In the last CAP programme, Ireland was second only to Finland in our environmental spending under Pillar 2, ahead of countries like France, Germany, Austria and Denmark.
An overall target of 40% of the total CAP budget will be allocated to environmental actions. The proposals also included further targeting of direct payments, with proposals for capping and redistribution measures and further internal convergence. A new governance structure of a single national CAP strategic plan and a new delivery model with a focus on outcomes and performance was also proposed. In October 2020, I, along with my European ministerial colleagues, agreed a general approach to the new CAP. It is critical to note and dispel one of the mistruths around the new CAP. It was at that meeting where we saw the overall CAP budget increased marginally. Ireland played a key role in delivering this increase and our stance on CAP has been one which has led the conversation in Europe to deliver on that. It was proposed to allocate 20% of the direct payment envelope to support the introduction of eco schemes and to include an enhanced baseline for environmental conditionality. The Council general approach also provided for broad flexibility for member states to take account of their own national circumstances.
The Council general approach supported the new governance proposals, including that the next CAP will be implemented through a new structure of a national CAP strategic plan. Each member state will have to set out an overall plan, covering all expenditure under Pillar 1 and Pillar 2. This new approach aims to support actions across both Pillars in a consistent and coherent manner, while the new delivery model focuses on assessing the impact of the substantial investment which will be made under the next CAP. The European Parliament also reached its position on the Commission's proposals in October 2020, and it has included higher targets for environmental spending, including 30% for eco schemes. It is seeking a more prescriptive approach, with less flexibility for member states. This is particularly the case regarding the redistribution of payments, where the European Parliament is seeking 100% convergence and a mandatory 12% level of redistribution.
The Portuguese Presidency aims to reach a conclusion on the Common Agricultural Policy before the end of its term and we had hoped to achieve that in May.
However, it was not possible, despite me and my European colleagues wanting to see a deal. I worked hard with them to try to achieve a deal at that last council meeting. It was disappointing that the European Parliament did not step up to the mark and genuinely engage in negotiations. That is why talks ultimately broke down. The Parliament must now front up and take these negotiations seriously.
From the beginning the new proposals have been the subject of extensive consultation and that will continue. Even before the draft regulations were published, national consultation had started in Ireland on the new CAP. Currently the CAP consultative committee, which includes broad-based representation, provides a forum for ongoing consultation and updating of stakeholders with regard to the negotiation process. My officials have undertaken modelling work on the direct payment proposals which has been provided to stakeholders and published. This work is designed to keep farmers informed at all stages of the process.
I have been always clear that I am seeking as much flexibility as possible in the final outcome. We need a CAP that will work for Ireland, our farmers and the wider agricultural sector. Some in the Dáil support the position that Europe should be setting the CAP path for Ireland but I entirely reject this approach as it does not support our farmers. What works in Malta will not work in Maam Cross and what works in Croatia will not work in Carndonagh and we cannot ignore this fact. The stance of wanting Europe to arbitrarily set the standards by which our farmers should farm is not one that will suit us best and I cannot understand why Sinn Féin, in particular, is supporting it.
When the final parameters of the regulations are agreed, we will then have certainty regarding our options. As Minister, I will engage closely with farmers and their representatives. The reality is that the next CAP will have to arrive at a balanced outcome and this will be no easy task. This can sometimes be overlooked when people focus on a particular aspect of the CAP on its own. There are nine separate objectives for the next CAP, with a tenth overarching one of agricultural knowledge and information systems. This cannot be a single issue, single focus new CAP for Ireland. We have to reach a balance that recognises the need to successfully manage the many demands on the CAP including the production of safe, high-quality food, support for farmers' livelihoods and rural communities as well as the maintenance of sustainability throughout all of these choices.
I want to assure everyone that at the heart of our considerations will be Irish farmers and farm families. As we reach the final stages of the negotiations, the issues that divide us now are the key ones to which I have already referred, namely the amount of expenditure allocated to environmental actions, the level of the baseline conditionality all farmers must comply with to receive any payments and the level and extent of redistribution. When we know what the parameters of redistribution are in the final regulations, we will have to undertake further modelling to ascertain the best choices for Ireland. The current system for payments has been in place for some time. When one makes changes to a long-standing system it is inevitable that challenging choices will have to be made. That is why I remain focused on obtaining the most national flexibility we can achieve.
I will meet again at the end of June with my European colleagues, when we will all be aiming to reach a conclusion on these issues and agree a new CAP at European level. A no-deal CAP does not bear thinking about. I continue to fight for the flexibility for Ireland to make decisions for Irish farmers and our country. I believe it is better for us if we can adapt the CAP proposals to take account of our own farming structure. As we draw up our plan, I am committed to continuing to engage with all and to consult widely and I look forward to hearing the views of Members today. Despite the next CAP looking different from its predecessors, it is my singular focus to ensure that our farmers can keep doing what they do best which is producing world-class food in a safe, traceable and sustainable manner. The CAP is crucial to our farmers and our farm families. Having been lucky enough to have been born and reared on a farm, I saw first-hand the benefit of the CAP and its impact on farm life as well as the rural economy. I understand the importance of a CAP that will serve Irish agriculture well over the next number of years.
As we discuss the proposed new CAP today, it is important to take a moment to acknowledge the vital role it has played and will continue to play in the future for Irish agriculture and for farm families. The CAP protects family farm incomes, supports the rural economy, ensures the production of high-quality safe food for consumers and protects rural landscapes and the environment. It is not a case of simply supporting farmers. It does so much more than that and is a policy that Ireland has continually led on and supported. We now owe it to our farmers and to the rural economy to deliver a new CAP that will continue to position Ireland as a sustainable food production capital of the world.
Across the European Union more than ten million family farms are supported by the CAP. It supports job creation and economic growth and plays a vital role in rural areas in particular. Around 40% of the land area of the EU is managed under the CAP, so in addition to the provision of food, a range of public goods is delivered by CAP schemes. Ireland’s agri-environment scheme, GLAS, supports almost 50,000 farmers to undertake actions which benefit biodiversity, landscape, water and climate change. The innovative approach of the European innovation partnership programmes has also seen strong participation in actions to support farming for nature.
Today the reality is that the EU, including Ireland, is a leader in sustainable agriculture while delivering high standards of food safety along with high standards in animal health and welfare. With the launch of the Green Deal as well as the Farm to Fork and biodiversity strategies, the EU has declared its intention to transform the sustainability of European food systems and to work collectively with its trading partners to achieve this on a global scale. Alongside the current European standards and achievements in the agrifood sector, we must now look forward to the changes proposed in the next CAP which will support this transformation to the next level. While we do so, we must ensure that our farmers and food producers are at the very centre of everything we do in CAP. We will continue to listen to and engage with our farmers as we navigate through CAP.
As we prepare to implement Ireland’s national CAP strategic plan, we must be able to continue to support the production of quality food while recognising that the demands to improve outcomes from the environmental and public goods perspective have increased significantly. We have to prepare to meet these. In so doing, we must consider not just what we are doing now but how much more we will have to do to meet the future challenges. We need to improve outcomes with regard to sustainability. This is vital both for climate change and to ensure the protection and future success of our national agriculture sector. We cannot and will not stand still.
Over the years we have seen CAP supports ensure that the EU has developed self-sufficiency in food production and has become a major global exporter of quality food and drinks. As we move out of the acute stages of the Covid-19 pandemic we must acknowledge the vital role played by agriculture and Irish farm families, supported by the CAP, throughout the pandemic. Hard working Irish farmers and the operation of the EU single market have shown that the CAP can and does deliver. Our citizens, who have had much to worry about during the pandemic, did not have to worry about their food security. Let us be very clear that this policy is vital and the steps we take to implement the next CAP and the choices we make will have huge significance for the sector and for all of us. Our challenge is that the CAP must preserve food production and, with the same level of success, ensure sustainability.
The food and drinks industry is Ireland’s largest indigenous industry, accounting for more than €14 billion in exports. As Minister of State with responsibility for new market development, this is a key area of focus for me. We are always proactively seeking out new markets to reward our farmers and processors. Ireland’s reputation for safe, sustainable and nutritious food is recognised worldwide. This is exemplified by Origin Green, the world's first food and drink sustainability programme operating on a national scale.
Across Europe the introduction of the European Green Deal and the Farm to Fork strategy have put climate at the centre of all policy choices. We all recognise the important role the European agriculture sector must play in the achievement of a higher level of climate ambition over the period to 2050. However, we must also acknowledge the challenges that the Farm to Fork strategy will present for all Member States.
Ireland has welcomed the vision of sustainability set out in the new Green Deal and the Farm to Fork strategy. We expect the new CAP to contribute closely to the achievement of these strategies. It will be important that any targets to be met are backed by comprehensive impact assessments and work is already underway on these.
Targets must also take account of the different starting points of member states and the sectors concerned.
The CAP regulations and the strategic plans that are being prepared provide a good basis for incorporating the objectives of the farm to fork strategy. However, I do not believe that just one policy, even one as substantial as the CAP, could have the ability to deliver all of what is needed to achieve this ambitious vision. With such a high level of ambition, innovation will be necessary right along the food production value chain. Achieving this ambition will require new business models and partnerships with producers, industry and consumers all working together. However, none of us could argue with the ambition to move towards a healthier and more sustainable food system. The next CAP can make a strong contribution towards this innovation in our most important indigenous sector. It will be vital that we achieve the necessary flexibility in the outcome at the European level to allow us to prepare the most impactful CAP strategic plan for Ireland.
Farm structures differ across Europe. If we are to ensure the correct support to achieve the change we want, we must be able to fashion our own destiny. This process will take place with ongoing consultation. There are differences of opinion and concerns. I recognise that it remains the most sensible and prudent course of action to deliver a CAP with the flexibility to make decisions for our farmers. However, we can see clearly that when farmers are offered environmental schemes that suit their farming systems, there is strong support for and substantial take-up of these measures. We can see this in the participation in GLAS and the European innovation partnerships initiative. Ireland has been a leader in implementing these innovative projects and I am delighted they will continue in the next CAP. Farmers are willing to engage and we need to provide schemes that support them. Ireland is only second to Finland in terms of environmental spend in the last CAP. Our farmers have long shown a massive commitment in this area. They are pioneers leading the charge and that will continue.
We must ensure clarity and coherence for farmers in the various requirements across the two pillars of the direct payments and Pillar 2 targeted measures. One of the areas on which Ireland has been seeking certainty for farmers is the definition of eligible hectare. We want to ensure there is no incentive for farmers to remove valuable bio-types and landscape features from their existing areas. This is a matter of extensive debate in the negotiations and we do not yet have certainty in this regard. In all of these debates there is a balance to be struck between the competing objectives of the CAP. However, we are trying to achieve certainty for farmers and we will continue to do so.
It will be important for all of us to proceed with an evidence-based approach. During the process, a number of exercises have been undertaken on the modelling of direct payments. These exercises can be considered further in conjunction with other material on farm payments and incomes such as CSO data and the Teagasc farm income analysis. This modelling work has all been published and is available on gov.ie. Further work is now under way on the redistributive elements.
There has been extensive consultation on direct payment options with the CAP consultative committee stakeholders and a separate questionnaire was issued to stakeholders in this regard. It is clear that these are not simple choices and there is a divergence in opinion on the options before us. Nevertheless, we will continue with this approach of further modelling and consultation with our stakeholders once we have flexibility to shape our future.
Ultimately, all Members, regardless of political persuasion, want the same outcome. We want a CAP that will keep our farmers doing what they do best, namely, producing a world class product which is exported to over 180 markets across the globe.
From my perspective in my role and with my responsibility in the Department for farm safety, I look forward to a higher level of farm safety ambition across this CAP being incorporated across all elements in Ireland. I also look forward to the consultative process we will have with all the stakeholders for the rest of this year to ensure that becomes a reality.
There will be challenges on the road ahead but we must stand firm and stand with our farmers to show we are there for them. There will be change but change does not have to be negative. The Government is with farmers every step of the way. We attach importance to our family farms, the top class sustainable food production systems we have in this country and the vital role farming and agriculture play in the rural economy across the island. With that, I welcome this opportunity for debate and discussion.
I thank the Minister and Minister of State for attending, although I have to say that for the past 20 minutes, we heard pure rhetoric, with nothing new and no position being taken on the areas of substance. The word "flexibility" was used countless times in both the Minister and Minister of State's contributions. I cannot check exactly how many times it was used because their speeches have still not been circulated. Let us make no bones about it and let us be honest. When the Minister and Minister of State say "flexibility" they mean they want to be able to maintain the status quo. Flexibility in Irish Government-speak in this instance means more of the same.
The previous CAP had flexibilities on convergence. The Irish Government pursued the absolute minimum of 60% that was permitted. The previous CAP allowed the mechanism and the flexibility for a government to put in place upper limit payment levels. The Government used that flexibility to ensure that a small cohort of corporate entities remained in the position to draw down hundreds of thousands of euro. The difficulty is that whenever Irish Governments have been given flexibility, they have always used it to benefit the chosen few.
The second bizarre claim by the Minister is that all of a sudden he is a defender of Irish sovereignty at EU level. When he said the European Parliament is causing him so many problems he failed to mention that the reason the European Parliament has so much power is that Fianna Fáil gave it to this power in the Lisbon treaty. Sinn Féin articulated at the time that it would undermine the voice of Irish agriculture in CAP talks if the European Parliament had such a say in the deliberations. Fianna Fáil accused us of scaremongering and now the Minister is saying the European Parliament is making an extremist proposition.
The area in which the Minister was most disingenuous was in his statement on the overall budget. The facts are as follows. By the end of the next multi-annual financial framework, MFF, Ireland will be contributing an additional €1 billion per year to the European budget. The CAP budget will be receiving €100 million less. Those are the cold facts. The CAP's share of the next EU budget will fall from 37% to 30%. That is the agreement the Government made at European level. The least the Ministers can do is be up front with farming organisations and farmers the length and breadth of the country on the reason they are being pitted against each other in respect of that same budget. It is because the Minister negotiated and agreed a bad deal. He is now going to the European negotiations to argue against the majority of Irish farmers. That would be a bizarre position were it not for the fact that the Minister is just the latest in a long line of Ministers with responsibility for agriculture who have taken that exact position at an EU level.
We know why there is a need for redistributive measures. It is because under the current system for which the Minister wants to maintain flexibility, Larry Goodman is able to claim €414,000 per year. A stud farm in Kildare owned by a sheikh is drawing down €222,000 per year. That money is supposed to go to Irish farmers and the Government is looking for the flexibilities to maintain the current position. Our farmers are consistently being asked to deliver more while being paid less.
There is a new format for the eco schemes, which the Government is trying to reduce in the negotiations. To return to the EU budget, why did the Government not demand that a separate Pillar 3 with new EU funding be provided? The inference from the figures the Department is producing is that this is new money or a new scheme with new criteria, which does not form part of the basic payment. If it does not form part of the basic payment, that means that in reality the cut to the CAP budget has been even more significant than I have outlined.
I have said time and again that our farmers need fair play. That means that if they are asked, as they should be, to do more in the area of climate action, they need to be compensated for the work they are doing, and are willing to do. They need fair prices. Yet again, they are waiting for the great measures that would provide fair prices, which the Minister promised to deliver when he was in opposition.
Crucially, farmers need a fair CAP. That means there has to be redistribution. The Minister has yet to say what redistributive measures he will require. Let us recall that full convergence would deliver more income to 72,000 family farms. That is 60% of Irish farms and the proportion is even higher in the Minister's constituency. Despite this, the Government is blocking talks at EU level and fighting against full convergence. As a member of the Opposition, the Minister demanded continued convergence, even during the transition period.
We do not know what the Minister is saying now about the position. We know that front-loading payments would disproportionately benefit smaller and medium-sized farmers. We do not know what the Minister's position is on that matter. We still do not know what upper limit payment cap the Minister believes should be in place. I have short questions to which I would appreciate short answers. I believe the upper limit payment without any loopholes or preconditions that any enterprise should be receiving under the CAP pillar 1 payment is €60,000 per annum. What does the Minister believe should be the limit?
The Deputy has the audacity to stand here and try and sell that as being his own policy. In the same way, he is also trying to take some ownership of the ombudsman's office for which he had previously suggested no allocation or support.
My objective was to achieve a cap of €60,000. I have been pushing for that at EU Council level. I have pushed for it the most of all the representatives of EU member states. It remains to be seen what will be the final level.
I will make the following point. The Deputy's policy was for an €80,000 cap until I set a policy of a €60,000 cap. He followed on in that regard so he should not be coming in here today and trying to sell himself as the author of that policy.
The difference between the Minister and I is that he is in a position to deliver on policy. What level of convergence does the Minister think should be in place? I ask him not to say he is waiting to carry out analysis. He was an Opposition spokesperson on agriculture for a term of government and has been in office for almost a year. What is his position? What should that figure be?
We need to be able to have a national consultation over the summer on this matter involving farmers from Donegal to Kerry and from Wexford to Meath. We must look at all the issues inside and out and then decide.
The Deputy was obviously not paying attention because I did not say that. I said I would continue convergence during the transition period. Since my appointment as Minister, there has not been sufficient time to do that for this year. I will consider the position as it will impact next year. I hope we will be able to agree a national position on the next CAP in advance of that. I have been always consistent and the Deputy should have paid a little more attention. The Deputy's party got it wrong in taking a position and then followed Fianna Fáil. I have been clear that there needs to be consultation and engagement on this CAP. There needs to be full engagement with farmers on anything that impacts on farm family incomes across the country.
The Minister has been a defender of sovereignty and has fought for flexibility to ensure decisions are made at a national level. That is laudable. Will he ensure the CAP strategic plan that is being sent by the Irish Government is first approved by the Dáil?
More than that, I will ensure that I engage with farm organisations and farmers right across the country on this issue. The Deputy and every Member of the Oireachtas will have an opportunity to have an input to that discussion.
"Of course, the overarching issue is going to be that of the budget ... We have to look at this against a backdrop where, in the past ten years, there has been a 20% drop in the income coming to Irish farmers from CAP ... It is crucial that a line be drawn under the matter and that those reductions be stopped. I do not believe any reduction in the next CAP will be acceptable." Those are the Minister's own words, which he spoke in 2018. He has failed to deliver. Farmers from Mayo are listening to the Minister say we have got a slight increase in CAP payments. One of the most pertinent issues in global economics right now is inflation. We have not figured in that here. Farmers know all about inflation as it affects the cost of manure, diesel, services, insurance and everything else they need, particularly as it relates to the agri-environment schemes that are being offered. The Minister mentioned the green low-carbon agri-environment scheme, GLAS, but the actual bottom line of what farmers earned from GLAS, particularly those in the west of Ireland, was absolutely nothing like the scheme that was promised to them in the first place. In calculating the overall figures, as my colleague, Deputy Carthy, has said, we will be contributing an extra €1 billion per year to the EU while we are getting €80 million to €100 million less from CAP. If we are going to deal with this, the Minister cannot, when he goes out to consult with farmers, give them figures that are wrong. He needs to get his figures right in this regard.
I want the Minister to explain to farmers in Mayo why he is fighting against full convergence and front-loading that would bring an extra €11 million into the county. Farmers in Mayo want to know that and it is my main question to the Minister today. Mayo is one of the counties that would benefit most from bringing in equal levels of basic farm payments. Instead of the Government fighting and part-blocking the minority in Europe, it needs to look at what is happening on the ground. Farmers will be displeased to hear what the Minister has said. Those farmers have been loud and clear, the Minister just has not been listening to them.
The budget is only marginally up on the previous seven-year programme. The Government fought to ensure there would be no cut to the funding. I wish it were far more. We fought to get our allocation as high as we could. There, unfortunately, has been downward pressure at EU level on the percentage of the overall EU budget that goes towards the CAP over recent years and decades. It has been, and will be, my objective as Minister to do all I can to support farm incomes. That is why, in terms of our national budget, the Minister for Public Expenditure and Reform, Deputy Michael McGrath, and I have delivered an 11% increase in the budget, year on year, at national level.
There undoubtedly has been pressure applied at European level. The Deputy also made a point about fighting against convergence and that is not the case. We must have a discussion about our national CAP plan over the summer. What Deputies Conway-Walsh and Carthy are saying is that Europe should dictate what we do on this matter and that I, as Minister, should go over to Europe and seal a deal there without consulting with farmers. I have not taken a position on convergence yet.
The CAP budget is starting from a lower base than in previous years. CAP currently makes up only 30% of the overall EU budget as opposed to the 37% it made up in previous years. We know the emphasis, going forward, must be on making farming sustainable and delivering environmental benefits. However, if the CAP budget continues to decrease, it will mean farmers are being asked to do more for less money and that is not sustainable.
I am aware there are ongoing discussions at EU level on the method of redistribution of payments and, as previous speakers have said, Sinn Féin is in favour of full convergence and is of the opinion that payments should be capped at €60,000 so that a small number of very wealthy landowners cannot benefit to the tune of several hundred thousand euros while smaller farmers struggle to make ends meet. Full convergence would unduly affect some smaller farmers so we are calling on up to 20% to be ring-fenced for front-loaded payments for small and medium-sized farmers who previously benefited from valuable entitlements. Redistributive measures are essential to ensure CAP payments are fair.
I support and recognise the need for eco schemes, going forward, as we all do.
Additional funding must be made available to farmers, however, over and above what they have been in receipt of up until now. Otherwise, we are asking farmers to do more for less money and that cannot be allowed to happen. It has been indicated that the new schemes will be result-based but other factors such as inclement weather, which could affect output, need to be taken into account. In fact, inclement weather is because of climate change. If, therefore, farmers are trying to take measures to reverse climate change, factors like this cannot be ignored and common sense must prevail. In addition, any unspent funds for eco-schemes must remain within the State and must not return to Europe.
I am sorry, Deputy, we are out of time. We must move on to the other speakers. I remind everybody asking questions in their slots to allow time for the answers. We must move on now to the Labour Party and Deputy Sherlock.
I thank the Acting Chairman very much. I am grateful for the half.
I will start by aligning the issue of the CAP negotiations to the Climate Action and Low Carbon Development (Amendment) Bill 2021, which we will vote upon tonight. I want to align the two because I believe they are absolutely and utterly complementary. I want to get a sense of the Minister's perspective on what climate action measures or types of schemes he envisages will be put in place arising from a new CAP. What kind of funding mechanisms will be put in place for climate action?
Before my second question, let me first make a political point in that we completely disagree with the guillotining of this Bill this evening. There are hundreds of amendments, which we feel strongly should have been addressed. More time should have been given, for instance, to the issue of the elephant in the room, that is, the biogenic methane issue. Assurances are being sought by the farm organisations about how that will be dealt in respect of carbon budgets.
Is the Minister assured that the climate Bill, as it constituted at present, gives sufficient coverage to farmers such that any measures they put in place regarding climate adaptation or mitigation are adequately dealt with in this Bill? I suggest to the Minister that it is not adequately proofed so that one can take into account the measures farmers themselves undertake with regard to offsetting the effects of biogenic methane. That is something on which we need clarity. I will come back in if I have time.
I thank Deputy Sherlock. I will try to be brief. On the funding for climate action measures, the Deputy will be aware of the situation regarding the proposed CAP, whereby a minimum of 20% of Pillar 1 will now go towards eco-schemes. My objective there will be to make sure that however they are framed, those eco-schemes are accessible for farmers in order that they can actually participate in them but also that leakage from that is absolutely minimised so the farmer can retain that payment. While they will have to do things for it that make a contribution environmentally, they get to keep the payment. That is really important, particularly in Pillar 1.
With regard to Pillar 2 then, obviously, there will be a real, significant need for the continuation of many of the schemes that were there previously but also for a really good, strong, new agri-environmental anchor scheme. Importantly, to go along with the EU funding in this regard will also be the €1.5 million commitment from the carbon tax between now and 2030.
I believe the Climate Action and Low Carbon Development (Amendment) Bill is very clear, particularly with regard to the socioeconomic importance of agriculture, of having to have full regard through the Climate Change Advisory Council and the Government. That is really important. Likewise, the science around biogenic methane is also really important in terms of ensuring agriculture is addressed in the way the science outlines and takes it into full account.
I genuinely do not wish to put the Minister on the hook but all those of us who will support the climate action Bill tonight still feel strongly that not enough time was given to explore issues such as how biogenic methane would be dealt with, regardless of which side of the argument one is on. There is, however, a genuine concern on the part of farming organisations that the Bill does not sufficiently address the issue of biogenic methane in respect of issues like sequestration.
The Labour Party, for example, proposed an amendment regarding afforestation measures where we were seeking sectoral adaptation plans so that one would clearly define what the targets on afforestation would be. One could design schemes around that, which would benefit farmers, for instance. I was told they were ruled out of order because it would be a cost on the Revenue.
For those of us who are trying to think laterally - without being too rhetorical about it - we still have to grapple with the issue of biogenic methane one way or another. We need an honest debate about that. I feel strongly that it is important it is allied to CAP, particularly with regard to the pillars in respect of agri-environmental type schemes that will be coming down the track.
There would have been time within the climate action Bill to do that but instead the Government tonight is guillotining that. I do not mean to be disrespectful to the Minister but I do not think I am satisfied with the answer he has given in his response on biogenic methane. We remain to be convinced that there is enough within the legislation as it is constituted presently. There is not sufficient wording in that. There is not a proper locking mechanism in it that addresses the concerns of those genuine farmers, who actually want to be involved in carbon sequestration, carbon adaptation and carbon neutrality, but do not feel as if there is a pathway for them at present. That is the concern I am trying to address here. There are 30 seconds left in the slot for the Minister.
That half minute is very important. Tremendous time has been given to the climate action Bill, both at the pre-legislative scrutiny stage and again in the Dáil. There is also a necessity here that we have to move on with it. If this was given all the time for every amendment, we could be here until next year debating it.
We must move on but tremendous consideration has been given to it. The programme for Government commitments, particularly regarding biogenic methane and the socioeconomic importance of agriculture, are transposed into the Bill. That is really important. Ultimately then, this will come back to the Government to make the decisions around it. There is an obligation on the Government to follow the programme for Government, as well as the legislation, in that regard.
I will continue from where Deputy Sherlock left off by linking today's debate on CAP to this evening's debate on the climate action plan. First, is the Minister satisfied that enough recognition has been given within the climate action plan to the efforts of Irish farmers and Irish agriculture? As for the ongoing issues that cannot be measured at the moment but which may be measured due to scientific advances in a couple of years' time, is there is provision within that Bill for that to be allowed into our sequestration targets? There no sense in us talking here about the good agricultural and environmental conditions, GAEC, proposals on sustainable incomes if there will be a difficulty for farmers coming down the line.
Second, I welcome the key commitment to make farm incomes sustainable. That is absolutely necessary because more and more people are actually beginning to give up on farming. Without out farmers, we do not have food. It is as simple fact but it needs to be repeated because many people do not seem to understand that.
Within this CAP programme and within these CAP proposals, what specific proposals will there be to encourage younger farmers to come in and stay within farming? What specific proposals does the Minister have in mind around the flexibilities he is seeking for the so-called forgotten farmers, for whom he has done a huge amount of work, to try to ensure that they are taken care of? On the challenges facing many of our sectors, including our sucklers but, in particular, our sheep and our hill farmers, what areas will be specifically tailored? What flexibilities, which he is seeking, will the Minister use to assist that sector to protect and grow their incomes and keep them on the land?
I am satisfied that the programme for Government commitments have been transposed into the climate action Bill with regard to ensuring that the socioeconomic importance of agriculture is recognised by the Government, and that the science around biogenic methane is very much central to all considerations, both at the Climate Change Advisory Council and by the Government thereafter.
Ultimately, this will be a decision for the Government, looking across all sectors to see how best we can achieve our target. The programme for Government gives very clear regard to agriculture and that is transposed into the Climate Action and Low Carbon Development (Amendment) Bill.
In regard to sustainable farm incomes, that issue absolutely has to be central to all we do in government in terms of supporting farmers. That is why I am focusing at European level on making sure there is the capacity in the national CAP plan to give full consideration to the different sectors in farming and how we can best support them. It is also why we have delivered an 11% increase in the budget for the Department of Agriculture, Food and the Marine this year, to support farm families, maintain many of the schemes that are in place and enable new schemes to come into operation. One of those schemes is the results-based environment agri pilot programme, REAP, under which Galway and Mayo are the two counties with the largest numbers of farmers participating. Many of them are sheep farmers, which the Deputy mentioned. That is a very important sector and one I have worked to ensure is central to the CAP and fully supported under it. In the case of young farmers, at least 3% of overall CAP funding will go towards supporting them. We must ensure there are young farmer top-ups as part of that. We will also look at other schemes and engage with all farmer representative organisations, including Macra na Feirme, in drawing up our national CAP plan to see how we can ensure moneys allocated make a real impact in genuinely supporting young farmers to enter the industry and renew our farmer base.
The Deputy also mentioned the forgotten farmer issue, which we have discussed on a number of occasions. I have asked officials to put together a report looking at all the ins and outs of this issue, because there are many complications in it and farmers are impacted in different ways, with a view to trying to accommodate them as part of the next CAP and ensure they get a fair deal. There is no doubt many of them missed out under previous CAP provisions because of the timing of their entry into farming and other issues. It is really important that they get full recognition and I am working to ensure that is done under the next CAP.
Yes. Deputy Cathal Crowe is unable to attend the debate as he is at a meeting of the transport committee to discuss aviation. I am glad to have an opportunity to talk about some of the very significant changes that are coming down the line in terms of the CAP. I speak as somebody from a community that has greatly benefited from the current CAP. We must acknowledge that Ireland is a country with a range of different farming needs. Constituencies such as the Minister's in Donegal is miles apart, from both a topography and agriculture point of view, from my constituency of Cork East, where there is a great deal of intensive agriculture on which thousands of livelihoods are based. In my constituency, the sector includes people working in a primary role as farmers as well as those involved in the production of dairy produce. In fact, the dairy sector in Cork East is far and above one of the most developed in the country. I am thinking also of neighbouring constituencies like County Waterford, which is over the bridge from Youghal, where I am from, County Tipperary to the north, as well as counties Kilkenny, Carlow, Wexford and Kildare. Agricultural activity in those places is poles apart from the situation in parts of the northern section of the country.
From my perspective, it is important to give the Minister an outline of the grassroots situation in my constituency, based on what people have been telling me and what I know is coming down the line as a result of the changes in convergence. The honest truth is that it is not good. I am gobsmacked today to hear one Sinn Féin Deputy after another slamming the Government on the requirement for 100% convergence. Do they have any idea or clue of the effect that would have on the provinces of Munster and Leinster? It would be devastating for people working in dairy farming and tillage. I see Deputy Carthy is smiling. He is a disgrace and what was said is absolutely outrageous.
To be fair to the Minister, he is new to his job. I very much look forward to getting him down to my constituency. He needs to hear the effect the CAP reforms will have on farmers at a grassroots level in my community and constituency. I grew up on a dairy farm and am one of the few people in Dáil Éireann about whom I can confidently say that our weekends at home involve milking cows. I am extremely worried about the reforms that will be contained within what the European Commission is currently looking at implementing.
I want to use my time to speak about some of the other aspects of what is going on in regard to CAP reforms. On sustainability, it is critically important that if we are going to be forcing climate measures on farmers in this country, that we also reward them effectively for the good work they can do in terms of boosting biodiversity. There are also possibilities in terms of energy generation on farmers' lands. We must look at addressing comprehensively the crisis we are currently going through in the area of forestry. Anybody working in the forestry industry will tell the Minister that Ireland is miles from where it needs to be compared with our European colleagues in terms of the production of timber and, from a biodiversity point of view, coverage of timber. We are far behind where we need to be in that regard. Perhaps the Government should look at this issue before forcing fines, additional inspections and new measures around biodiversity and climate sustainability on ordinary farmers. They are already under enough stress.
Regarding energy generation, I have made the point before that I am very fortunate to have had a bit of experience working in energy. Farmers in this country are huge users of energy, including electricity. Looking at the role of the Sustainable Energy Authority of Ireland, SEAI, is one mechanism, through the Minister's Department, by which we might further advance microgeneration. This is an issue we spoke about when we were trying to form a Government. We need to see whether there are possibilities for farmers to get seriously involved in selling energy back to the grid. The people of rural Ireland would much prefer to get their electricity on a local basis through microgeneration than to be blighted by large wind farms that destroy the countryside and should all be offshore. I feel very strongly on this particular issue.
I am interested in the Minister's reply to my points about microgeneration and forestry. I am leaving him approximately three minutes to come back on those particular points and what he plans to do to address the issues. I hope he acknowledges my comments as those of someone from a different part of the country from him and coming from a very different perspective in terms of the dairy industry, which we do not hear enough about in this House.
I thank the Deputy. His points on convergence speak to the challenges that arise in different parts of the country in this regard and also the importance of having a full national debate and consultation on the issues. They also speak to the fact it would not be appropriate for a Minister, without having had that consultation and full engagement with farmers of all types, from Donegal to Cork and every other county, to go off to Europe, as Sinn Féin and some others would say I should, and decide the matter arbitrarily. It will be a challenging debate to have. The budget at European level is now agreed and set and there is a defined pot. What is not set is how it is distributed and how that will impact on various sectors. Working with my European colleagues, I hope that by the end of this month, we will be able to agree the CAP plan at European level. It is really important then, over the next number of months, that we have a full engagement and consultation at national level, right across the country, before making a final decision. I certainly will engage with farmers of all types because this issue is important in terms of farm incomes and it has very different impacts in Donegal, for instance, compared with Cork. There needs to be that engagement at national level with our farmers.
In regard to microgeneration, there certainly is a lot of potential and opportunity. My Department has been engaging with the Department of the Environment, Climate and Communications and the Minister, Deputy Eamon Ryan, on this issue. There is significant potential that we need to look at developing. We are considering ideas in terms of how we can develop the potential of farmers to contribute to our energy sector.
Likewise, there is a lot of untapped potential nationally in terms of forestry. There have been very significant challenges in recent months within the Department of Agriculture, Food and the Marine in regard to licences. Both the Minister of State, Senator Hackett, and I are working very hard to address those challenges because they have been inhibiting to the sector. There is a great deal of potential for farmers in the coming years, not just in traditional forestry but also in terms of how it can be part of a whole-farm system. We must embrace the opportunities, including opportunities for significant income generation for farmers.
Tá ceist fíor-shimplí agam don Aire. Cén fáth an bhfuil sé ag troid i gcoinne CAP a bheadh níos fearr d’fhormhór na bhfeirmeoirí ar fud an iarthair, ar fud ceantair Ghaeltachta, ina chontae féin i nDún na nGall agus i mo chontae, Contae na Gaillimhe? Mar gheall ar a dhearcadh agus dearcadh páirtithe an Rialtais, tá feirmeoirí atá ag streachailt cheana féin, atá ag cur seirbhísí agus earraí fíorthábhachtacha ar fáil dúinn ar fad agus atá ag déanamh oibre iontach, chun cailleadh amach ar na milliúin euro. Tá Gaillimh chun cailleadh amach ar €5.3 milliún, Ciarraí ar €11.3 milliún agus Maigh Eo ar €11.4 milliún. Tá sé dochreidte céard atá ar siúl ar an Rialtas. Bhí an tAire ar son coinbhéirseacht agus é mar bhall den Fhreasúra ach anois agus é sa rialtas tá dearmad iomlán déanta aige air seo. Ba cheart go mbeadh íocaíochtaí lochtaithe tosaí ann. Tá sé go hiomlán mí-fhéaráilte go bhfuil beirt fheirmeoir atá ag déanamh an post ceannann céanna ag fáil íocaíochtaí éagsúla mar gheall ar bhealach measta atá bunaithe ar bhearta táirgiúlachta ó 20 bliain ó shin. Níl sé seo féaráilte agus tá muintir na Gaeltachta ag fulaingt dá bharr.
I have a simple and straightforward question for the Minister. Why is he arguing against measures that would benefit the majority of farmers, including those in his own home county of Donegal and indeed those in my home county of Galway. Quite simply, the Government's being against the redistribution of funds to farmers in western counties will see Galway farmers lose out on €5.3 million. Many of these farmers are already struggling and are doing absolutely vital work. The Minister was in favour of convergence when in opposition. I note he told my colleague, an Teachta Carthy, that he was only in favour of continuing convergence through the transition period but I am pretty sure if farmers in my home county of Galway and in his own home county of Donegal were asked, they would say the Minister set himself on a platform of convergence. He himself has highlighted that small to medium farmers with valuable entitlements might suffer. Why is he resisting this? Why is he continuing to treat farmers in County Galway in a fundamentally unfair way? The CAP has moved on; productivity measures linked to the early 2000s should have no bearing. How can the Minister justify paying two farmers who are doing the exact same job different amounts based on those outdated metrics?
In 2020, over €3.6 million in direct payments went to just 20 farm enterprises, while average CAP payments in counties Roscommon and Galway are about €10,000 and many farmers receive much less. At the same time, some individuals are receiving between €200,000 and €400,000-plus in CAP payments. This is not right, it is not fair and it is something we should be fighting tooth and nail to end in these current negotiations. I welcome what the Minister said about confirming an upper limit of €60,000, which is what he is seemingly fighting for in Europe. It is welcome. Speaking as someone who was born and raised on a beef suckler farm, and who has lived there all my life, 100% convergence is fair. It will benefit up to 72,000 farmers. Some farmers, especially those who are receiving tens of thousands more than the average farmer in the likes of counties Roscommon and Galway currently get, will receive less. There will be those who are on huge amounts now who will lose out but it will be to the benefit of all farmers across the State.
I want to make reference to the new pilot environmental scheme, which was labelled as "REPS 2" ahead of the general election. Instead, it is a move to a payment-by-results model that will put huge pressure on farmers. Under it farmers may lose out on payments due to factors like weather which are totally out of their control. The scheme is extremely limited as far as participant numbers are concerned and that is due to the tiny allocation of €10 million that has been provided for it. It is also really disappointing that those farming land containing heather were immediately excluded from that pilot programme. As has been said, eco-schemes are now more important than ever but we must remember farmers are taking part in environmentally-friendly practices and they will continue to do so. However, they must be compensated for it in a very simple and straightforward way. They must be rewarded for what they are doing.
On Pillar 2, what reduction are we looking at for the rural development fund, which is really important? I must also state that many farmers and their families are really struggling, particularly beef farmers. The income is not there any more, costs are increasing all the time and there is nothing there for young farmers. We must therefore ensure that we do right by them in these negotiations.
I have repeatedly sought clarification on the Government's position on the CAP negotiations, and that the Dáil could vote on those proposals. Regrettably, the Minister's replies have been vague and there has not been any scrutiny or accountability in relation to his position on the CAP, not to mention a vote. The protests last Friday across Ireland and the submissions to the agriculture committee indicate the frustration and confusion among farming communities. This far into the negotiations, on a policy that will shape Irish agriculture and the landscape for years to come, we should all be crystal clear on the Government's position and what farmers can expect.
The priority for Government must be supporting family farms and truly sustainable practices. The Irish Cattle and Sheep Farmers Association has called for family farms to be protected in the negotiations, to ensure the viability of small-scale agriculture. The Irish Natura and Hill Farmers Association has highlighted the benefits of greater flattening of payments. The Minister needs to follow the principle of supporting small farms. While we know there potentially will be winners and losers in any changes to a policy, the obligation must be to support as many farmers as possible. The CAP must support the many, not the few.
Second, we need sustainable farming, which is the only way rural Ireland as we know it can survive. However, the Government’s mixed messaging and inconsistent approach undermines the drive for sustainability. The Climate Action and Low Carbon Development (Amendment) Bill fails to define clear targets for emission reductions in each sector. It fails to robustly define any semblance of a fair transition. This is crucial for farming communities. It does not even attempt to provide the reassurance farmers and workers need. The protests last week indicate the uncertainty and fear out there and while it is being politically stoked up by certain politicians and there has been much scaremongering, the Government has not helped. We need a strong just transition policy to ensure the inevitable changes are fair and supported.
The results-based environmental agri pilot, REAP scheme, is another example of this confusion. It has limited scope, those on the organic and GLAS schemes are ineligible for it and now there is the unexplained exclusion from it of over 6,000 farmers. Also excluded is commonage, land with gorse and heather and so-called marginal land. This overlooks the carbon sequestration capacity of these areas, blatantly disincentivising the very thing we need more of. We need schemes like REAP but we need them to be more ambitious, more consistent with sustainable practices and open to as many farms as possible.
The withdrawal of the environmental pillar from the Agri-Food 2030 strategy committee is another worrying indicator. The group points out that this industry-led approach is incompatible with the action needed in the face of our climate and biodiversity crisis. The Government is looking for more flexibility at national level for Ireland’s interpretation of the CAP, which the Minister keeps referring to, but we have no idea what this interpretation will look like in terms of Irish policy. Farmers want and need certainty and leadership on this. It is clear from meetings, protests and committee statements what farmers want. It is now up to the Minister to clarify his position and plans. We have yet to find out what he wants. In his speech he stated "In October 2020, I, along with my European ministerial colleagues, agreed a general approach to the new CAP." I wonder what it is. He then clarified the European Parliament's position by stating the "Parliament is seeking 100% convergence and a mandatory 12% level of redistribution". That kind of clarity on the Minister's own position is what everybody is asking for. Deputy Carthy spoke about being in Letterkenny but whatever about all that, we know the Minister's position when in opposition was for 100% convergence. It is fair enough if he has changed his mind; we are all entitled to do that, but would he not just come out and explain to the House why, where he is coming from and let farmers know?
The Minister also stated, "I have been always clear that I am seeking as much flexibility as possible in the final outcome" but what will he do with the flexibility? Everybody is looking for that answer. Does the Minister realise that his comments leave us none the wiser?
The Minister is now the one at the CAP negotiations and interpreting CAP policy for Ireland. In that context, will he tell us what tangible difference there is or will be between this Government's policy and that of the previous Government? What will the Minister do with convergence and why has he changed his stance? What will he do with all the flexibility he has been pushing for?
I thank Deputy Cairns. I have a couple of comments on the policies of this Government and what we are doing for farmers. The budget for the Department of Agriculture, Food and the Marine this year has increased by 11% in trying to support farm families, which demonstrates the prioritisation we give to supporting farmers in the work they do. I am progressing work on establishing a food ombudsman's office and I have just closed the consultation process on that. It again demonstrates the commitment to transparency in the food supply chain. Those are two very clear examples.
The Deputy mentioned the REAP scheme, which was five times oversubscribed. Farmers really recognised how beneficial it was to them. It is easy to quibble about certain elements of the scheme but the bottom line is that when farmers looked at it in detail, despite much of the protest we might have seen in the Dáil, they realised the benefit of the scheme in terms of income and accessibility. Unfortunately, we could not accommodate everybody as it was a pilot scheme constrained by the terms and conditions of the transition period under the CAP. There is nothing secretive about why 6,000 more participants could not get into it. I managed to push it as far as I could so that 5,000 people could participate, despite the constraints.
The Deputy has mentioned before matters relating to convergence and redistribution and I will clarify them. While in opposition, my position was not that there would be 100% convergence. I am clarifying that so the Deputy does not repeat her comments to that effect. My position was that we should continue the convergence pathway to 75% during the transition period. Convergence would benefit my county very significantly but I have always recognised what a challenging issue it is. It is not something that should be arbitrarily decided by a Minister, or even worse, by Europe. That is what many people here are saying. It should be decided in consultation with farmers right across the country, and it is what I plan to do over the summer. I plan to consult all farmers, including those in the Deputy's constituency, my county and everywhere else. This is really important to all farmers and they should be involved with it.
This is not about a Deputy coming here and asking what a Minister will do or decide. My position is that I will engage with everybody in putting together a national CAP plan to try to get as fair as possible an approach to what is a very challenging matter. It is absolutely the right approach. I look forward to the Deputy's engagement and views on that as well.
Looking at the big picture for farming, once again Europe has failed to grasp the big nettle. Looking at dairy farming and particularly beef and sheep farming, putting aside the fixed grants that people get irrespective of productivity and as long as they have a very basic level of farming going on, the more intensively one farms, the smaller the profit that is made. When a farmer does up his or her accounts at the end of the year, the more intensive farmer will eat more into those grants. I have looked at endless sets of accounts and spoken to endless numbers of farmers. It is absolutely farcical that in this industry, the harder one works, the more intensively one works and the more efficiently one works, the less money is made. Until we grasp that nettle in an international sense, we will have problems in agriculture.
The Minister knows my view on convergence, which is that farmers with high output and very good land should make their money on price. Basing any grant on something that happened in 2001 or 2003 is foolish. A young farmer who is 25 now was five years old when this was settled and if his or her parents or grandparents owned the land, they may not have been farming it intensively. When I tried to ascertain the relationship between stocking intensities and single farm payment rates, the Department indicated that it could not give it to me because with all the buying and selling, the figure would be irrelevant anyway. There is no relationship to what happened in 2001.
Under the previous CAP, the greening payment was not subject to convergence and people continued to get the greening payment at the full 30% rate of what they had inherited from 2001 or what they had bought. What rate will now apply and will that rate continue for the greening part of what will be the new basic payment? We will not have time for the answer today but the Minister might send it on. This is a very fundamental question that I have not seen answered.
I am a little annoyed by commentary from certain farm organisations and leaders that disparages the part-time farmers as if they were happy farmers. The Minister and I know from representing marginal land areas that they are absolutely vital from an environmental perspective. We also know the most productive farmers would be at a loss from a European perspective if we did not have environmental areas.
Everybody forgets that in many cases, farming households on the west coast or in the poorer parts of every other county are dependent on the combined income from a very modest job and their farm to get a decent standard of living. We should remember that there are hilly areas, disadvantaged land and people on low payments in each county. We are talking about a real part of those farmers' annual income that is combined with their off-farm income. Many productive farmers have partners or spouses in very lucrative jobs. All farmers working for a serious income are important, whether they are big or small.
There is another matter that has gone unnoticed. In the north east, REPS amounted to €11,000 for many farmers and now the equivalent process amounts to €4,000, with major compliance costs arising in the context of planners. That is a loss of €7,000 and convergence to date in no way makes up for that loss. The percentage income loss for farmers who got the full rate under REPS and who are getting the current rate of what was GLAS is ginormous.
The reality is we need reform and Europe has baulked at that idea. I spent much time as a Fianna Fáil spokesperson on agriculture discussing price. I went over and back to Europe and people said they were interested. However, we have not dealt with the payment to primary producers. I grant the Minister that this is a worldwide problem but it is also a European one. Until we make it profitable to produce beef, lamb and so on, we will continue to destroy the productive farming we all need.
I find myself in the rare position of not only sharing time with Deputy Ó Cuív but also of agreeing with a few of his points. From first-hand experience, I am aware of what has happened to some of those involved in intensive farming, particularly farmers with dry stock, as a result of the fact that prices in the beef sector had been low until recently. Those in this group who were more involved in intensive farming tended to lose more money and were obliged to dip more into their single farm payment in order to keep the farms afloat. The Deputy also made a valid point about winners and losers that could emerge on the basis of what is being spoken about in this round of CAP discussions.
There is poor land and there are disadvantaged areas in every county, not least in my county. It strikes me that Kilkenny and Carlow, the counties I represent, and neighbouring Wexford are, as the proposals stand, the three counties that could end up losing most. The farmers who benefit most from the single farm payment and have the highest entitlement are dry-stock farmers. They are generally not dairy men and women.
Many family farm enterprises operate using finance they are able to secure on the basis of their single farm payment. I fully support the Minister on capping. I have always supported the notion that there should be an upper limit. However, I am talking about the difference between a small-scale beef producer being a viable farmer and able to live and rear a family on the farm and potentially not being able to do so if we go to the extreme and opt for 100% convergence. I admire that the Minister is sticking to his guns as regards the 75% proposal. Many people do not appreciate that 60% convergence operates under the current CAP system.
I remind Deputies that the origins of the CAP was to produce food. I was a Member of the Oireachtas in the early 2000s when the single farm payment reference years were introduced. I agree with previous speakers that the reference years now bear little resemblance to the practice on the ground for many farmers and new entrants, whom Deputy Ó Cuív mentioned. I remember speaking against the idea of the single farm payment at a number of meetings of farming organisation at that time. My argument was that the payment would be used to reduce payments once the coupling was broken between production and payment. I accept that we will never go back to a fully coupled payment but I regret that the leading farming organisation did not see fit recently to support at least a partial coupling.
As I said, most of the farmer producers in the south east are not industrial scale operators. The counties I represent and surrounding counties, not the counties in the west, have, on average, the lowest disposable household incomes nationally. The south-east region also has had the lowest third level attendance rates for a long time. Hopefully that will change with the establishment of a technological university in the region. Many people depend on agriculture and families are reared and children are educated using the income from the family farm. Every Member who has spoken has referred to the importance of supporting the family farm but there are different definitions of what would constitute a family farm.
I am a firm believer in the original purpose of CAP. It was never designed to be a welfare payment. It was designed to aid production and to ensure we have safe food on the shelves of our shops and supermarkets. I worry that, in the medium term, some sort of food supply issue will break out across the European Union and potentially across the world. As a country that can produce more food than we already produce, Ireland has a moral obligation to do that to the highest animal safety and food production standards. I fear that many farmers in the livestock sector, which is subject to the volatility of prices and is the very sector that most Members want to support most strongly, could be adversely affected if there is a significant drop in their single farm payment or if we were to go anywhere near 100% convergence.
The main discourse around the CAP negotiations is pitting the small against the big farmer. It highlights how 100% convergence would see a big shift of money from the south and east to the north and west. The main narrative missing in this discourse is a vital player in this game, one who potentially stands to lose the most, namely, the farmer with a medium-size farm. Having spoken with farmers of this scale in my constituency of Clare, they have genuine concerns about the future viability of their farms.
Medium-sized farmers stand to lose a lot if they cannot come up with the resources to implement an eco-farm scheme as they will not qualify for CAP payments if they do not transition. Thus far there has been little or no clarity about what this eco-farm scheme will look like. This ambiguity is causing anxiety within the community. As one farmer said yesterday, the vagueness is crippling. Will the Minister create a third pillar of funding specifically for eco-schemes?
Fianna Fáil and Fine Gael have landed us in a position where we can expect 7% less than in the previous EU budgetary cycle for CAP allocations, despite the fact that farmers are crying out for fairer deals and have a just transition to surmount. Farmers are again being asked to do more to receive less. Sinn Féin is calling for a third pillar of funding solely focused on environmental programmes dedicated to the transition of eco-schemes for small and medium-size farms which need support to navigate a just transition. I support the idea that if the money streamed into Ireland for these schemes goes unspent, it should remain in the country.
Sinn Féin has called for the capping of Pillar 1 payments to €60,000. The fact that there is no cap on these payments, while small and medium-sized farmers struggle to make ends meet is hard to swallow. Many farmers stay afloat because of the single farm payment, not the actual income generated by trading livestock. Last year, just 20 farm enterprises received €3.6 million in direct payments. This is illogical at best and corrupt at worst. One wealthy owner of a buoyant business received €414,000 of EU money that is supposed to be used to strengthen and develop our society as a whole, not the already mega-wealthy. It is an absolute disgrace.
I agree with much of the commentary on the need to ensure the sustainability of the family farm. Beyond that, many people in the EU have forgotten what CAP was about, namely, the steady supply of safe food. The biggest problem we have is the reduced overall CAP budget. Its share of the overall EU budget has declined from 37% to 30%. What will this look like? Has the Department game-planned the cuts which will obviously be put to the back end of the budgetary cycle?
Could I also be allowed the liberty to find out, on behalf of the potato growers in my constituency and other areas, if there will be a derogation this year with regard to the desiccant, diquat? This is creating a difficulty. Many of the Members present attended a briefing at which we were told that the Department and other parties would provide an alternative. Potato growers are saying there is no alternative at this point in time. Perhaps the Minister will answer those queries.
I thank Deputy Ó Murchú. I will take the second point on diquat first. The use of diquat has been suspended at EU level. There is ongoing engagement with Teagasc on alternatives and how to use them. I made it clear to farmers last year that this was the route they should take this year.
On maintaining sustainable family farm incomes, that is obviously a key objective in how we frame the next CAP and the impacts it might have. It is not straightforward and certainly not black and white. The objective is to try to support family farm families in every way we can. There must be a clear objective of ensuring that we do not, by our actions, push some farmers who are currently struggling to farm full time into a position where they can only farm part time. We have seen this trend for decades and we must be conscious of it in framing our policies.
I would like to check the position regarding budgetary cuts.
If I am correct, they will be at the end of the EU budgetary cycle. Have we looked into this? What sort of cuts could we be looking at? Whatever difficulties we might have with convergence and flexibility at this point in time-----
We are clear at this point on what the budget will be between now and 2028. In monetary terms, it is narrowly up but in percentage terms, the overall CAP is down. This has been a challenge over many CAP cycles. If we include inflation, it reduces its impact in real terms. Monetarily, it has increased. Pillar 2 has increased by 20%. We have fought very hard to maintain the budget and to try to keep it as high as possible. It is becoming more and more challenging at European level but we are very committed to it. As I stated earlier, the 11% increase we delivered for the national budget this year shows the commitment we have nationally to supporting our farm families.
I thank the Minister, Deputy McConalogue, and the Minister of State, Deputy Heydon, for facilitating today's question and answers on the important CAP negotiations. It is also important to be sensitive when discussing the range of farming payments and the impact of potential changes to these payments. Often, they are critical income for farming families and particularly so in counties such as Mayo which I represent. It is also important to recognise that the value of CAP payments has significantly shifted from east to west since 2014. Payments to Mayo, Donegal, Galway and Kerry have increased substantially in recent years.
I wholeheartedly agree with the comments of the Minister on the opportunity to make decisions at national level. This is a very important step. His earlier comments summed up the main issues highlighted to me by farming organisations and farmers on convergence, the transition to eco-schemes and minimising the impact of eco-schemes on farmers' basic payments, which is an important step. The front-loading of payments has a significant impact on small and medium farmers, and should be best prescribed by member states at national level.
In policy terms, some have described convergence as being a crude measure that will severely hit farmers with a high payment per hectare but result in an overall lower payment. This has serious consequences for Irish farmers because of demographics, and I know the Minister is working hard to find solutions in this regard. As we heard earlier, an important step forward is seeking national consultation with farmers. It does not seem unreasonable to seek flexibility on policymaking at national level versus a blanket across the board approach. This is especially true when we consider the variance in agricultural and rural populations in EU member states.
The criteria for farmers to be eligible for eco-schemes must be practical and encourage the maximum number of farmers to participate. They should be designed to recognise farmers who are actively farming their land through environmentally positive actions. This should be reviewed accordingly. A cost incurred or income sacrifice model would have a significant negative effect on farm incomes and should be avoided. We should be measuring positive environmental impacts.
The main issues I have raised with regard to CAP are convergence, eco-schemes and front-loading, and how they would impact a constituency such as Mayo or Donegal.
In his opening statement, the Minister referred to the fact he grew up in this world and this life, and I know he has the best interests of farmers at heart and will do his best to ensure the right balance is struck. What is often left out of this argument and debate is the value of farming and farming livelihoods to the local economy. The Pillar 1 basic payment we are discussing goes back into local communities, villages, towns, co-operatives and hardware shops as farmers buy fencing and farming materials. It really makes rural Ireland tick. This is why it is so important that we get this right and ensure we do not make farming unviable. We must instead do the opposite and increase the viability of farming. The Pillar 1 basic payment is very important in doing this.
I attended some of the IFA protests in my constituency, in Clonakilty, Bandon and Skibbereen. What is really clear is that farmers want to play their part in making farming sustainable, achieving emissions targets and improving the environment and biodiversity. What is also clear is that they want to be fairly rewarded for this and do not want to be out of pocket. There is a fear about the eco-schemes. Farmers welcome them, as we all do, and we need eco-schemes to improve sustainability and biodiversity. However, it does not make sense that 30% of the payment that goes to eco-schemes leaves farmers out of pocket. In other words, they are receiving less for the 30% they put into eco-schemes. What may happen if we do not get this right is that farmers will opt out of the eco-schemes. No one will benefit, neither the farmer nor the environment. It is so important that we get this right under Pillar 1.
With regard to Pillar 2 and proper agri-environmental schemes, the Minister mentioned the unbelievable take-up of the REAP scheme, which proves farmers want to do more. We need to get the agri-environmental scheme under Pillar 2 absolutely right. Deputy Ó Cuív spoke about payments under the old REPS of up to €11,000. We need to reward farmers for these measures to improve sustainability and biodiversity. If we do this, we will make farming viable and improve the environment. I would love to see the Department begin to clarify and explain. In the programme for Government we committed to putting €1.5 billion from carbon tax into agri-environmental schemes. We need to start giving farmers confidence this will happen.
I welcome the opportunity to contribute to the debate. I am a suckler and beef farmer. We are at a crucial moment in agriculture. We have to use the Common Agricultural Policy to pay money to farmers to make sure there is food on the table, as was the case with the CAP many years ago. We must also pay tribute to the many farmers the length and breadth of the country who produce a world-class product that we are able to sell into any market in the world. We can stand over our products. This did not come easily. It came through the hard graft of farmers who embraced a huge amount of regulation. They embrace it every morning they get up and every day they do their work.
Within the Common Agricultural Policy, it is important to ensure the family farm is made as sustainable as possible. It is a vital cog throughout the country. In my area of north-west Cork, and throughout Duhallow in north Cork, it is vital that there is a future for the family farm and that young people are encouraged to believe there is a future in farming to which they can look forward. This has to be the cornerstone of the discussions we have and the final package that comes from Brussels.
The eco-schemes have to be well funded. Since the REPS was introduced approximately 25 years ago, many successful changes have taken place at the farm gate. Farmers have embraced these and we have seen huge improvements in the environment throughout the country. No matter what report or audit is done by the European Commission, Ireland or anybody else, it shows the money spent on eco-schemes has been used successfully to improve the environment. Farmers are the custodians of the environment and they have done very well with this over the years. It is very important there is a fundamental good and decent scheme that is well funded and can ensure farmers continue to do this. We must also recognise that we must not have regulation that is too cumbersome and that there is a streamlined scheme. Whatever final package is available, we must make sure we have at its core the family farm and that there is a proper workable eco-scheme for farmers.
I could debate this all day but there is only a short time available to me. We are at a crucial point in agriculture and we must make sure that we have to the forefront our biggest national indigenous industry, as other speakers have said, not only for the farm but also for the rural economy. The benefits of that cannot be measured merely in terms of having a viable agricultural industry.
Following the same theme as the two previous speakers, we are at a crossroads here. It is a vital period for Irish agriculture. The medium-sized farm with good entitlement is considered by the EU to be the ideal family farm model. This model has taken the largest financial hit due to convergence. I am concerned that this family farm model was not financially supported in the previous CAP programme and it is imperative that this model is supported in the next CAP programme. This model is ideally set up to adopt and take on any new eco and climate schemes. In the short time available to me, I ask the Minister, Deputy McConalogue, to respond in particular in relation to the family farm, the family farm model and the sustainability of farming. What will the Minister do? What will he ensure will be in the new CAP that protects the family farm and gives a future to Irish agriculture?
We have environmental sustainability and social sustainability but what anchors our family farm system is financial sustainability. That will be crucial in framing well the next Common Agricultural Policy to support families. Also, there is what we do then at domestic national level to support that in terms of additional funding, such as the 11% increase this year in national funding and the carbon tax proceeds up to 2030 supporting a new environmental scheme which can deliver significantly, not only from an environmental point of view but also in terms of farm family incomes. Ultimately, that is what it is about. It is about rewarding farmers for what they do, both in producing good, healthy and safe food but also in producing environmental goods and ensuring that they are well rewarded for that, and are financially sustainable in the process.
We are in a situation in which a debate is ongoing over how a diminished pot of supports is to be distributed among the country's farmers who are being asked to do much more in return for far less. It seems as though our farmers are being utilised instead of being supported.
The nature of the Common Agricultural Policy has changed from one that was supposed to assist farmers to engage in good practice with the benefits of high-quality produce being affordable for the consumer. Instead, what we have seen is a Common Agricultural Policy the funds of which have in many instances fallen into the laps of the barons or those who are sitting back receiving payments but who are not actively engaged in farming while young farmers work their land for a pittance.
In the course of many conversations there have been about the Common Agricultural Policy, we have heard a lot about reform in relation to the latest one. Reform is meant to be about progressive change which considers those whom it will affect and tries to bring them along with it. Instead, farmers and rural communities, whose common economic fabric depends in large parts on their prosperity, have been asked for more in return for less. This started when the Government agreed to a CAP budget that was bad for our farmers and bad for our rural communities. We are a net contributor yet, under the current arrangement that involve this Government, the CAP now makes up only 30% - a huge reduction when compared to the previous budgetary cycle where it stood at 37%. This led to talks stalling over redistribution measures. The Government's position seems to be against redistribution, which will not be good news for many farmers, which leads me on to fairness and convergence, front-loading and how to ensure that the CAP, with all its flaws, is distributed in as fair a manner as possible.
As matter stands, Pillar 1 payments are linked to productivity figures based on the situation in the early 2000s, which, of course, has little to do with the reality today of family farms, yet there is opposition to averaging Pillar 1 payments. Moving to full convergence would be to the benefit of 72,000 farmers and if flexibilities are implemented in the way Sinn Féin has been proposing, effects on others can be avoided. With this in mind, Sinn Féin has called for up to 20% to be ring-fenced for front-loaded payments to protect small and medium-sized farmers who have historically valuable entitlements. We also have advocated a €60,000 cap in the maximum Pillar 1 payment to prevent a disproportionate amount going to those who need it least. In 2020, €3.6 million in direct payments went to only 20 farm enterprises. Although Larry Goodman received over €414,000 and a single stud farm owned by Sheikh Al Maktoum received €222,300, many farmers must live on subsistence levels of payment. Now they are being asked to comply with a Common Agricultural Policy that has a different overall aim. That aim, of course, is the crucially important green strategy on climate action. Eco-schemes are needed, and never more so, but the way payments are being devised will result in farmers themselves being asked to fund a disproportionate amount of the environmental measures as they replace the greening payment from the previous CAP. Sinn Féin was in favour of the introduction of the eco-schemes but we argued that they should be part of a new separate pillar with new funding.
Young farmers have also been left fighting for survival. In terms of the minimum allocation for young farmers, it seems as though it is closer to the 3% than the 4% Macra na Feirme, for instance, had been calling for. The difference equates to €14 million over the lifetime of the new CAP but the impacts would have a far larger effect that would be felt for a long time to come. We cannot forget here that one of the objectives of CAP is to strengthen the social and economic fabric of rural areas. If our small farmers are forced out, our rural communities will suffer.
When it comes to price recovery, are the Minister and the EU Commission expecting that the price of the produce they pick up at retailers, such as meat, dairy and grain, will remain unchanged? I can assure the Minister, if this is the expectation, it will further the crisis in rural Ireland.
Finally, can I get written answers, if the Minister has not time, to these two questions. When it comes to the wording of the good agricultural and environmental conditions, GAEC, can the Minister give us some detail on how the derogation proposed in Article 4 of GAEC 2 complies with Article 2(1)(b) of the Paris Agreement, which calls for the greenhouse gas, GHG, emission reductions to be developed in a manner that does not threaten food production and can he update us on the discussions with the EU Commission on the working of GAEC 2?
The United Nations estimates that worldwide demand for food will increase by 60% by 2050. Experts estimate it will take as much innovation in agriculture in the next 40 years as in the preceding 10,000 years to meet the growing demand for food.
What is currently anticipated for Ireland is far from being innovative. When farmers from across the country are driven to stage a day of action through fear, worry and uncertainty about their futures, it is something we cannot and must not ignore. When the IFA president says that the combination of the current direction of CAP talks coupled with the Government's climate action Bill has the potential to shut down commercial farming in Ireland, not only must we not ignore it, we must stand up and fight against it.
We already know that only one third of farmers in Ireland are deemed viable at this time, largely due to having a second source of income. It is clear that the time has come to stand up and fight for Irish farmers. The Minister must battle with courage and determination on behalf of Irish farmers. When talks resume in Brussels, Deputy McConalogue must ensure that the outcome for Ireland is one that will copper-fasten sufficient supports for Irish farmers and not further erode their ability to survive.
Flexibility for member states, particularly for countries such as Ireland where the future of farming is of paramount importance to the economy, must be upheld and maintained. Supports for any sector in any country can never take a one-size-fits-all approach and this was never more true than in the case of the Common Agricultural Policy.
In my constituency of Tipperary, the value of agricultural exports is €1 billion. The farming community in Tipperary is a major driver of the local economy, as it is estimated that for every €4 a farm family earns, €3 goes back into the towns and villages in the county. This income derived from farming supports jobs in both the agricultural service sector and the commercial and business sectors. It keeps the wheels of commerce turning in rural Ireland. Reducing farm income would have a domino effect on towns and villages across the county and country. Rural Ireland is staggering on its feet and needs income support to recover.
I spoke to a number of the farmers who attended the day of action last Friday in Nenagh. The overwhelming feedback I got was of frustration and fearful anticipation about the future. A large number of farmers feel excluded from the decision-making process that determines their future. While they expressed full confidence in the IFA and the other farming bodies, which speak strongly on their behalf, they feel that their voices and opinions as individuals are lost and ignored. Farmers emphasise that they are as aware and committed to protecting and sustaining the planet for future generations as any other sector in society. They feel that there is an unfair public expectation that the major share of the solution will be shouldered by the agrifood sector. They worry that they will be victimised and scapegoated.
The circumstances and restrictions of the past 15 months have prevented farmers from gathering to discuss the impact of proposals that will determine their futures. We need to listen to the views of farmers across the country. That will give a true reflection of how farmers themselves are thinking and feeling as regards the crucial decisions being made in respect of their livelihoods. These are the people who work the land and will live with the consequences of any decision made in Brussels. These are the voices that need to be heard at this time. It is vital that the Minister carry the voices of these farmers with him to Brussels when he returns to the negotiations. He has our best wishes for his endeavours in that regard.
I welcome the opportunity to take part in this important debate. The Louth and east Meath constituency that I represent has a strong rural and farming community. I have dealt with this community on many issues over the years. It is one of the most dedicated and hardest working sectors in the economy. In the north of the county, we have the Cooley Peninsula and Faughart regions, where there are farming families going back many generations. Further south and towards the middle of the county, we have many more farming communities that have dedicated their working lives to the land.
It is clear that farming faces many challenges. The prices farmers are getting for their produce are constantly under pressure, yet prices are not falling for the consumer. As we debate the CAP negotiations today, let us be clear - farming is the backbone of rural Ireland. In terms of numbers, the farming and food sector employs over 300,000 people throughout the country. In terms of exports, it contributed more than €13 billion in 2020. Put another way, the sector contributed more than €250 million in exports every single week of the year in 2020. This is a staggering figure. The employment figures show that, outside of the Dublin area, the farming and food sector provides almost 14% of total employment. That is more than one in ten people. When we look beyond direct employment, it is estimated that the output multiplier is 2.5 for the beef industry and 2.0 for the dairy and food processing sectors. This compares favourably with the rest of the economy, where foreign-owned firms have a multiplier of 1.2 while the rest of the economy has a multiplier of 1.4. It is clear that the farming and food industry is vital to the Irish economy, not only in terms of money, but also in terms of communities.
The Government must do more to stand up for the farming and food sector. I agree with the IFA's statement that the approach to CAP reform by the EU, along with the Government's climate action Bill, could shut down farming as we know it. That is not what we should be doing. Some farmers are being hit with substantial cuts under CAP. On top of this, we will see the Government's climate Bill resulting in considerable additional regulation and, as a result, significant cost increases in the farming sector. Ultimately, the end consumer will pay for these costs. I know from my dealings with the farming sector that it supports climate action. Farmers want to see carbon emissions reduced and a greener society, but how can they support this, which will involve significant capital expenditure, if they are going to receive less money? It simply does not add up.
The facts are there for all to see. Last year was the seventh year in a row that food prices declined. In the same period, the cost of producing top-quality, safe and sustainable Irish food produce increased. That is simply not sustainable. We are either going to support this sector or we are not. Words or vague commitments are not enough. Action and real support are needed. For example, there is a commitment by the Government to provide €1.5 billion from the carbon tax for agri-environment measures. Where is that commitment today? Is the money ring-fenced? When can the farming sector avail of this commitment?
I put on the record my full support for the farming and food sector. I acknowledge the great contribution that it makes to the economy. I also acknowledge the great farming communities of north Louth, mid-Louth and the south of the county. It is clear that these communities need the Government to support them during the CAP negotiations.
I call on the Minister to commit fully to the Government's pledge to provide €1.5 billion to help the farming sector through agri-environment measures. Will he confirm that this money will be made available to the farming sector?
I know the tremendous value of agriculture to Deputy Lowry's constituency. He outlined it well in his contribution. I assure him that, in putting the next CAP together, we will consider all farm types and consult farmers in great detail to ensure that CAP is as farmer friendly as possible. I look forward to the Deputy's engagement in that. There will be a comprehensive consultation over the summer to which everyone, including Oireachtas Members, will be able to contribute.
For 70 years, CAP has been a price support, guaranteeing top-quality food for European consumers at a low price. There has been a fundamental change in policy at European level, though, and CAP is moving towards becoming an environmental payment. This will have consequences for European consumers. Food price inflation has to follow if primary producers are to stay in business.
In the current round of CAP negotiations, three issues are still on the table for finalisation - the eco-schemes, convergence and front-loading. Regarding eco-schemes, a new environmental payment will form part of CAP. Whether it amounts to 20% or 25%, it will be significant for farmers. It is essential that there be no compliance cost. This is farmers' money and 100% of it must go into their pockets. Every farmer must be eligible for the payment. We cannot afford any leakage of the money.
The European Parliament is seeking 100% convergence and I understand that the Council of Ministers is seeking 85%. However one views the issue of convergence, there will be significant winners and losers, even within the same parish. Unfortunately, some people with small acreages could be significant losers whereas people with large acreages could be significant gainers. Through national measures, we must try to bring fairness to this on behalf of the people with small acreages who currently have high payments per hectare.
The Minister wants to bring the question on front-loading to the Oireachtas for a national decision. Front-loading would probably help people on low payments per hectare, but it would require a linear cut across all farmers' payments. Given all the changes that are happening, I do not know whether another linear cut on top of the cuts that are already coming due to the present round of CAP is feasible for farmers.
This round of CAP must cater for young farmers. As has been well highlighted in the media, the percentage of farmers under 35 years of age is at a level never before seen. Young farmers must be incentivised.
An issue that I raised with the Minister previously is that of the forgotten farmers. This round of CAP must do something to help those who, through no fault of their own, unfortunately lost out in previous rounds. We must look after them this time. It is probably our last opportunity to do so.
I will keep my points brief, as my time is limited. While the negotiators continue to work towards a consensus on CAP, it is worth highlighting that the current state of play is demonstrative of the divergences within and between the agricultural sector and policymakers. There is a misalignment between policies, funding mechanisms and the views of people who manage and work on farms.
On the one hand, we want to support smaller farmers and young people involved in farming, but on the other hand, CAP payments chiefly benefit larger and more industrial farms.
The EU has a plethora of policies on climate action and biodiversity protection, yet the proposals under the CAP do not put sufficient value on the preservation and protection of land. Instead, they build on a legacy of intensive farming and land use illustrating blatant incoherence between the CAP as a fundamental policy instrument and environmental protection. As a result, EU countries are connecting the dots between the increase in intensified farming with the decline in farmland birds and insects. This misalignment could not have been better illustrated than in a report conducted by the European Court of Auditors last year on biodiversity on farmland. The report asked one overarching question, namely, whether the CAP contributed positively to maintaining and enhancing biodiversity. The short answer is “No”. Among its finding, the report highlighted gaps in the design of the EU biodiversity strategy and that most direct payments do not maintain or enhance farmland biodiversity. In fact, according to the scientists, voluntary coupled support may have a negative impact.
Most worryingly, the greening measures of the CAP have had little measurable effect, highlighting that greening has led to changes in farming practices on only about 5% of all EU farmland. This figure proves that we have a long way to go in improving the environmental protection of farmland, yet we hear from various stakeholders and member states that the greening measures of the CAP are too green. Something is awry here. Either there is a flaw in the design of the greening of the CAP or the endorsement of EU farmers is on paper only, with little or no follow through. Either way, it has led to discontent among farmers and environmentalists alike.
We are at a point in time when people are questioning, not only value of money when it comes to CAP payments, but also whether funds are appropriately used for both the equitable production of food and the preservation of our environment. In this House, we often talk about supporting the smaller farmer in ensuring the lifeblood of rural Ireland. The next CAP provides the opportunity to put those words into action. Let us ensure a more equitable distribution of funding throughout farms and reward the protection of our natural environment, instead of continuing to incentivise the intensification of land use and food production at the costs of water and air quality, biodiversity and our international climate commitments.
We all agree that housing, health and the Covid challenge remain the big issues for this House. The twin issues of CAP and the climate action Bill are very much banging on the door at the moment. For the farmers of County Longford and, indeed, rural Ireland generally, we must get value and a meaningful dividend from these CAP negotiations. The IFA has been in the vanguard of pursuing the interests of farmers. Over recent months, the CAP negotiations and the climate action Bill have manifested as the two big issues for farmers.
Last week, I met many Longford farmers as they came into town to highlight their position and fears. There are real fears in farm households. There are real fears that this CAP programme may be the death knell for one of our few remaining indigenous industries. CAP is about income and how we manage the environment. It is critical that any eco-schemes proposed will see in excess of 30% CAP Pillar 1 funding ring-fenced for environmental measures. As previous Members have said, it is important that no farmer is excluded from this and that none of the money for this pillar should seep out in terms of compliance measures either. Time and time again, we heard the word “convergence” used here today. I hope that the Minister, Deputy McConalogue, will champion 75% internal convergence in the negotiations.
Moving on to Pillar 2, we must commit to maximising national co-financing of these schemes. We must ensure these schemes are funded to the maximum level under CAP. While Fáilte Ireland and the hospitality sectors are at great pains to make much of our green image, that image was not painted overnight. Rather, it was down to the determination and commitment of generations of farm families throughout this country. For the midlands and Longford, it is critical that there is no restriction on normal farming activity on peatlands arising from the implementation of the good agricultural and environmental conditions compliance. The genuine farmer must be put front and centre in these negotiations. We must see the phasing out of long-term leasing of entitlements. Farmers who have built up and are working their entitlements should not be penalised.
This debate is joined at the hip with the climate action Bill. As a party, Fianna Fáil made much of the commitment in the programme for Government to allocate €1.5 billion, over the next ten years, to a new agri-environmental scheme. This must be in addition to CAP Pillar 2. It has been noted that we are already falling behind in this commitment, one year into the Government’s term. These are worrying times for farmers and farm families. As a Government, we must stand shoulder to shoulder with the farming community that has built this great nation.
Deputy Flaherty touched on a number of issues which we have touched on before and outlined the position from his county’s perspective. He touched on a number of issues such as convergence, for example, and the importance of a well-funded CAP overall and ensuring the impact on farmers and their financial sustainability is central to how we frame the next CAP. I take on board the points he made.
Something that I have said throughout this debate is the importance of involving farmers in how we put together our national CAP plan. Whether it be Longford or Donegal, Kerry or Meath, farmers throughout the country of all sizes from all sectors should be consulted and engaged with on the various decisions that are still to be made. It is important those decisions are made at national level and that we have significant control over them, because decisions that are important to farm family incomes, farm families should be central to that. While that will be a challenging consultation, debate and engagement, it is important that is happens. It is important for the legitimacy of the CAP and the buy-in of farmers and farm families. It is important for the acceptance of whatever Common Agricultural Policy emerges towards the end of this year. As a member state, we will obliged to submit the various measures and decisions contained in the national CAP plan to the European Commission for approval by the end of this year. The objective is to develop the schemes next year and to have them ready to go and to benefit farm families and the agriculture sector from January 2023.
I thank Deputy Flaherty for his contribution today and for his ongoing engagement with me on a number of agricultural issues on behalf of his farming constituents.
I have been involved with farming organisations while a farmer. I once said to a politician that if one does not wear a pair of wellingtons, one does not know what farming is about. Being involved in CAP negotiations through farm organisations down through the years, I always wanted to make sure that the family farm was sustainable. It has not been sustainable, and it is not sustainable because of previous CAP agreements. If this does not change, will we be in the same situation where some farmers receive €250,000 to €300,000?
I know the Department stated recently in an agriculture and marine committee meeting recently that one must accept that this will not make a big difference if it is distributed, but that is the whole point. The mindset is that some farmers can make between €250,000 and €300,000 or more. Some 40% of farmers, as the Minister knows, are receiving between €1,500 to €5,000. It is an insane situation that some receive between €250,000 to €300,00 while 40% of Irish farmers receive between €1,500 to €5,000. That is why family farms are no longer sustainable. I am pleading with the Minister to ensure that this changes. There must be a cap on payments of between €60,000 and €80,000, but there is no point on putting a cap on them if one turns around and gives the payments in some other way. The cap on payments should mean that this is as much as a big farmer can get. The ordinary farmer should be brought up. In the situation of the farmers receiving €1,500 to €5,000, €6,000 or €8,000, that amount should be brought up €15,000 to €20,000. Those rates have not move in 20 years.
There is much talk in this House about eco-farming. I would say that many Members have not worn a pair a wellingtons in their bloody life. There is an organic scheme out there that has not budged. We had a two-hour debate on the agriculture committee. The Chairman, Deputy Cahill, fair play to him, brought about that debate yesterday. It has not moved for decades. Farmers have not benefited on an organics scheme. The Green party that is in Government now, and was before, has done absolutely nothing. Stop talking about eco-schemes. We have a scheme already, just make it better, more interesting and profitable for farmers to get involved in. Some of them are losing money by being in it.
Most are excluded from the application process. Our young farmers need to be looked after and a retirement scheme must be considered. There has to be a fair grant scheme for the ordinary small farmer. The new CAP cannot be for the extraordinary farmer, it has to be for the ordinary farmer.
There is massive anger and frustration among farmers. They genuinely feel that their concerns are not being listened to. The IFA is in Dublin today with members from all around the country, and many other organisations such as the Irish Cattle & Sheep Farmers Association, ICSA, and the Irish Creamery Milk Suppliers Association, ICMSA, have been sounding the alarm on these issues and concerns. I listened to this debate for at least 45 minutes and heard many rural Deputies speak about the importance of protecting family farms going forward. I sincerely hope that those Deputies will put those sentiments into action and vote against the Climate Action and Low Carbon Development (Amendment) Bill 2021, which is a huge threat to our family farms, later tonight. Let them take that action and stand up for their constituents.
I come from the rural constituency of Laois-Offaly, where farming is a central component of our local economy. We do not want our local economy crippled because of the Green Party's outlandish ideological wishful thinking. That party is on a different planet. I cannot believe that Fine Gael and Fianna Fáil are supporting this lunacy. The Green Party obviously has a wish list but it must be reined in. What is being proposed could destroy the concept of the family farm. I support a CAP that is fair and that supports all sectors of agriculture. It cannot leave any sector behind. We know how important every sector is to our economy, both locally and nationally. There is huge frustration among people and farming families. They are being thrown to the wolves. Fine Gael and Fianna Fáil need to stand up here tonight and support them. I hope those Deputies who voiced those lovely sentiments earlier will put them into action and vote against the Climate Action and Low Carbon Development (Amendment) Bill.
I apologies on behalf of Deputies Michael and Healy-Rae, who are currently attending their uncle's funeral on Zoom. Our sympathies go out to their family.
I was in Cahir last week to meet the IFA farmers. It was a beautiful day and a beautiful turnout, with a huge crowd in the square in Cahir. The farmers got huge applause and a great welcome from the customers, shoppers, shopkeepers, shop owners and everyone else. Ní neart go cur le chéile. That is what it is all about. Farming is so important. We are all only one step away from it. I declare that I am a hill farmer and have a sheep farm that I have leased to my son. I want to be honest about that. I have a direct question for the Minister and I want an answer in writing. Some €1.5 billion is ring-fenced under CAP for schemes. The Minister, on the Government's behalf, can provide up to 57% co-funding on that. Is he going to do that? Some payments have fallen behind already. The farmers have been blamed for being laggards but it is the Government that is the laggard and it is blackguarding farming.
I echo what Deputies Nolan and Michael Collins said about backbenchers coming in here and offering nice platitudes about supporting farming while telling us we are scaremongering. Some farming organisations also said we were scaremongering but they are here today and are now worried, when the horse has bolted. What is happening in the context of the Climate Action and Low Carbon Development (Amendment) Bill, which those Deputies are going to vote for tonight, is nothing short of an attack on rural Ireland and on farming families.
I wish the Minister well in his talks on convergence. I expect that it will come out around 75%. We can live with that and be happy with it but these are Mickey Mouse schemes. REPS was a decent scheme and then GLAS came in but what is in place now is folly. By the time farmers pay an adviser to submit the scheme and everything else they get nothing out of it. It must be profitable for the farmer to get out of bed and do his or her work. They put their shoulders to the wheel and fed us as a nation right through the years. They are the people who brought us out of three recessions. We are praising them now and they will be well if they are left alone but there is too much regulation and red tape. Above all, the Minister for the Environment, Climate and Communications, Deputy Eamon Ryan, is hovering over them like Petticoat Loose in Bay Lough, vulturing down on top of them with his mad ideas.
Farmers do an awful lot in respect of climate change. They accept that and understand it but they cannot be made scapegoats and that is what is going to happen tonight. It is dastardly that our group was only given six minutes to debate the CAP reform proposals. Giving that kind of time to rural Ireland is an indictment of the Minister and the Government. Farming is the most important industry we have and we are going to have four hours tonight to ram through a Bill to try to kill it off altogether. It is shameful and if Deputies from Fine Gael, Fianna Fáil and some Independents come in tonight and vote for that they should hang their heads in shame.
My first point is about convergence. It makes no sense that current payments are linked to production levels that obtained in 2000. That is illogical and unfair. There was a change in the previous CAP with 30% of Pillar 1 for greening. However, we pursued a deeply unfair policy whereby two farmers in the same county might be taking exactly the same actions under greening and one farmer could be paid €60 or €100 more per hectare. That is wrong. It impacted negatively in the Minister's constituency of Donegal, as well as in Sligo, Leitrim, Roscommon and elsewhere. Under the previous CAP, Ireland did the minimum on convergence and yet farmers were sold a pup, especially those in the west. They were assured that the Government would make it up to them in Pillar 2. I knew that would not happen and, unfortunately, it did not. REPS was eviscerated and those farmers who lost out on convergence in Pillar 1 lost out on Pillar 2 payments as well.
While the CAP budget is set by the EU, the Minister does control certain things. Will he commit to the highest level of co-funding for rural development? Will he also commit to substantial amounts from the €1 billion Brexit adjustment fund to support beef production and sheep production, especially in the Border areas that have been hardest hit? The Minister still has the opportunity to look at voluntary coupling. That is a tool that could be used to manage redistribution for medium-sized farmers on low acreage. I supported that in the context of the previous CAP but Ireland did not take that opportunity. Farmers want to be paid a decent price for what they produce but we do not have significant regulation for the primary producer in the food supply chain.
The Minister might get someone to reply to these questions in writing because we do not have enough time. It is scandalous that we only have a few minutes to speak on an agricultural debate when others did not bother their arses turning up at all. The previous Taoiseach, Deputy Varadkar, stated that Ireland would top up these losses. Will we top up the cap payment to make sure the budget is there? What are we going to provide in the carbon tax budget? The Minister for the Environment, Climate and Communications has talked about what is going to happen with that budget but it does not seem to be coming so far this year. In fairness, every Deputy has spoken about the good agricultural and environmental condition, GAEC, standards, which the hill farmers brought to our attention. We need the wording that is agreed in Europe on wetlands.
What will the maximum single farm payment be? I am a firm believer that €50,000 is enough, which is €1,000 a week, and it should be divided out among the smaller farmers. Will the Government front-load things? Everyone is talking about the smaller person losing money with high entitlements and a smaller amount of land. That is how to solve front-loading. REPS will probably come under Pillar 2. I am hearing that if the farmers who are on that scheme at the moment opt out, nobody new will be brought in. The budget, which is supposed to come from the carbon budget, will not be used. I am also hearing from people on the ground in different counties, as well as the different planners, that there are 30 different flowers included in that scheme. There are probably special names for every one of them, but from what I am hearing there are not many of them in most of the places the Department is looking for them. That will be a major problem because given the money they get from it, a lot of farmers will not even bother going into the scheme because they do not have X, Y and Z.
I do not need an answer from the Minister's Department on the climate Bill. If the Deputies from rural Ireland vote the climate Bill through this evening, the people of rural Ireland will be rattling at our doors, just as the people from Donegal and Mayo stood up yesterday. They will not tolerate what is going on and what is following the green agenda.
What exactly is the Minister going to deliver? Many promises were made before the last election, as there usually are. This was an unusual situation in that the promises continued on into the programme for Government. The Irish Farmers Association, IFA, has been particularly unimpressed by the results-based environmental agri pilot, REAP, scheme. I looked at it and I was a little bit staggered by the extent to which there is a certain maximum amount which can be drawn down. It is very low. Is it being suggested, therefore, that big farmers should not bother with environmental protection? The difficulty now is that a certain cohort of farmers opt out of the single farm payment completely because it ties their hands regarding what they can do with cross-compliance etc.
On the other hand, it is obviously an incentive for the majority of farmers to obtain the single farm payment. Equally, however, a large cohort of farmers would like to do what Deputy Leddin suggested and ensure their farming is done in a more environmental and sustainable way. More incentives were in place ten years ago, though, with the rural environment protection scheme, REPS, than there are now. There were also fewer ceilings in place in that scheme. How can the ceilings in the REAP scheme be justified, when contrasted with the lack of such ceilings in respect of the single farm payment? It simply does not make sense. I refer to incentivising farmers for every acre they farm.
We must also not forget that many farmers are farming large areas of marginal land. The whole idea of the single farm payment is that it compensates people for farming in a particular way and respecting the environment. However, it is even more difficult to farm marginal land sustainably and profitably than it is to farm 100 acres of land down the road from here and much closer to Dublin than where I or the Minister live. I think we both accept that point. Why, therefore, are we capping the number of acres for which payment is allowed to be received for adhering to the highest environmental standards in the world? Most people accept that it is important now that environmental standards be adhered to. However, that endeavour must be incentivised in some manner. What does the Minister intend to do in that regard?
I thank everyone for their contributions. It has been a very constructive debate. I look forward to more of these discussions as the new CAP evolves and then, hopefully, if we get agreement at the end of this month, as we put together our national CAP plan from that point onwards. The CAP ensures that our farmers can continue to farm, that we produce the highest quality food and that we have a balanced regional economy. I refer to money coming into a farmyard staying in the locality.
In the early hours of this morning, I returned from discussions in Lisbon with my European colleagues. We discussed how we can best deliver a CAP that will work for all farmers in Ireland, one we can shape ourselves and that we will not have dictated to us.
Other Ministers share my concerns regarding the overly prescriptive approach prescribed by the European Parliament. This is a critical point to which I referred earlier. The European Council is approaching the talks to achieve a CAP deal with a desire that we feel the European Parliament, unfortunately, has not shown. The final negotiations under the Portuguese Presidency will take place at the end of June in Luxembourg. We must reach an agreement which allows us flexibility in many of the key areas. I want to be able to develop, as I have outlined in several responses to questions, a CAP national strategic plan that best suits Ireland and Irish farmers and their families.
The CAP is expected to achieve a lot, but it cannot do everything. Everyone has a role to play. We need all elements of the industry to play their parts and, fundamentally, the market must recognise and reward positive change. Farmers embracing new standards in animal welfare or environmental actions need support and not just from the CAP. Fundamentally, these changes must be led by the market and supported. Industry must make the choice to support farmers who strive for higher standards and consumers must decide to reward that effort by choosing to pay for it. The CAP budget will do a lot, but we need a market response to ensure success. Many Deputies are concerned that farmers are being asked to do more, but many environmentally-friendly practices can also support more cost-effective approaches by farmers. This has been demonstrated by programmes run by the farm organisations themselves.
My focus in introducing eco schemes will be to ensure that they are straightforward to understand and simple but effective to implement. Farmers must understand what they are being asked to do and why. I hope all farmers will see the value of participating in these schemes. The numbers of farmers applying for the new REAP scheme demonstrates farmers’ willingness to engage and their genuine interest in environmental matters. Farmers understand the importance of sustainability. They receive their farms from the previous generation and hold them in trust for the next. Farmers do not need a lecture, but they do want clarity and my aim is for them to have this and to be fully consulted throughout this process.
The original proposals for the CAP budget included significant funding cuts. In the teeth of strenuous opposition, Ireland succeeded in reversing those serious proposed cuts to the EU budget for the CAP. The result of those negotiations is that funding for Ireland from 2021-2027 will be €10.74 billion, in current prices. This is an increase, compared to the original allocation of €10.68 billion for the current period. However, we must acknowledge that increased environmental and climate ambition across all policy areas was a key factor in getting agreement on the overall EU budget. This has been a strong demand of citizens across Europe and it is central to the new European Green Deal.
While there will be a certain element of change, our farmers need not fear this as they are already pioneers in this regard. Nationally, we will also have to consider the issue of Exchequer funding to provide the co-financing required to draw down EU funding. I assure the House that I will not be found wanting in seeking the necessary funding to support these objectives. Regarding enhanced baseline conditionality, this is part of the enhanced standards for the environment in the next CAP. This is a process which is familiar to most farmers and we already have in place well-understood systems regarding inspections. Again, I emphasise that the Council position supports member states in having national flexibility with regard to the definition of the national standard. There are some new standards, such as the new good agricultural and environmental condition, GAEC 2, for the protection of wetland and peatland.
I have already spoken at length on this issue to the House and I have always been clear about my stance on GAEC 2. I want to bring in a national standard that provides for appropriate farming activities to continue on this land. It has always been the view of the Council that farming, in a suitably environmentally friendly way, can take place on these lands. I listened carefully to the fears expressed regarding the implications of GAEC 2 and I raised this issue directly when the Council last met in May to seek to ensure that the final language regarding GAEC 2 is very clear on this point. My colleagues agree with this and it is my view that the final language on GAEC 2 will now be very clear on this point. As the son of a farmer from GAEC 2 lands, I know how rich these soils are and how they can work for the benefit of farm families.
Regarding the social dimension, I want to be clear that I fully support the proper implementation of full employment legislation. As less than 10% of Irish farms employ labour, this is unlikely to be a significant issue for Ireland. However, I have concerns about how this issue, which is very different from traditional conditionality, can be incorporated, as it is currently being considered, within the CAP. I will continue to highlight these complexities as we aim to reach the conclusion of the CAP in the next couple of weeks. Our national CAP strategic plan will include full consideration of the issue of support for young farmers. The challenge of generational renewal exists across the entire European Union and the issue of what level of funding will be allocated is still being considered as part of the negotiation process.
Currently, a series of measures are in place to support young farmers. The national reserve and the young farmers scheme provide financial support to young farmers during the crucial early years when they are setting up. Under the targeted agricultural modernisation scheme, TAMS II, young farmer capital investment scheme, young farmers can avail of a 60% grant rate, in contrast to the standard rate of 40%. Support is also available for collaborative farming to cover legal costs incurred.
Ireland has invested significantly at national level through several significant taxation measures which are available to young farmers. These initiatives include agricultural relief from capital acquisitions tax, CAT; retirement relief from capital gains tax, CGT; stamp duty exemptions on transfers of land; a €25,000 tax credit under the succession farm partnership scheme; long-term leasing income tax relief; and 100% stock relief on income tax for certain young trained farmers.
In total, €228 million is provided annually across the various national tax reliefs. I certainly consider that this demonstrates strong support for young farmers.
Much has been said about redistribution and the need to support family farms. I agree that we need to support them. I have made my views on the capping of large payments very clear and have succeeded at the Council negotiations in obtaining greater national flexibility in this regard. Indeed, it is my stance and the stance of this Government which has led the way in terms of capping. We must recognise that our farm structure is much more balanced than many other member states. The 80-20 rule relating to farm payment distribution simply does not apply in Ireland. We only have a small number of very large farms. Even farms involving company structures are often owned by parents with one child farming full-time. Equally, just because someone works part-time or even full-time off the farm does not mean that they are not farmers. They still farm, contribute to their local communities and provide important public goods. The reality is that Irish family farms come in all shapes and sizes. The entitlements system, in place over many years, is complex. All redistribution proposals have the most impact on those farmers who have entitlement values above the average. There are farmers with high value entitlements who do not have overall farm payments above the average but, equally, there are farmers with low or average value entitlements who have overall payments that are much larger than the average.
Again, I thank all Deputies for their contributions . I look forward to further engagement as the process at national level evolves and, hopefully, as we get an agreement at European level that is satisfactory.