Brian Ó Domhnaill (Fianna Fail) | Oireachtas source

It is always good to have the Minister in the Chamber because, unlike other Ministers, he comes in with a genuine agenda and is always willing to interact with members and answer questions. He has had a busy period in respect of the review of the Common Agricultural Policy and the Common Fisheries Policy which we are not discussing today. It is important that we have the opportunity to discuss the Common Agricultural Policy. The Joint Committee on Agriculture, Food and the Marine, discussed the matter in some detail yesterday while we prepared our submission for the Department on some of the key issues which are of concern. We all appreciate there were constraints in respect of the import and the reluctance of some member states to fund the multiannual financial framework and then the knock-on effect to the agriculture budget. It is regrettable that there will be a 3.3% cut on the Pillar 1 element to Irish agriculture under the new CAP. When inflation is added, given that it was running at the rate of 7% during the last period of the CAP, the relative cut to farmers is in the region of 11%. Even the real cut of 3.3% will mean a cut of €330 to a farmer on a single farm payment of €10,000.

I am glad the Minister mentioned Pillar 2 because it is important. Sometimes it is like playing football in the dark when one is trying to negotiate the payments for Pillar 1 without knowing what is available under Pillar 2 or how that money will be drawn down and what the co-funding availability and commitment from the Government will be because that will depend on the moneys available to various scheme under Pillar 2 whether agri-environment, the Leader programme, disadvantaged areas or whatever. I appreciate the Minister's closing remarks in respect of a Government decision on the co-financing of Pillar 2 but I hope there will be a real commitment to regional and rural development and that the Government will subscribe to 50% level of funding for Pillar 2. I am sure that is an objective the Minister will try to achieve. While I appreciate that some of the scheme may receive EU co-funding of 85% or 100%, on balance a real commitment must be shown by Government to rural and regional development. That can only be done where a meaningful co-funding mechanism is provided under Pillar 2.

In regard to Pillar 1, the Minister mentioned the budget which is a cause of concern. Any reduction in farm incomes against the backdrop of increasing prices and costs will prove negative for the industry. I have a number of questions for the Minister. Obviously a mechanism is built in for a voluntary capping of €150,000 on single farm payments. In reality that will have little impact in Ireland given that the vast majority of payments are under the threshold of €150,000. That is an issue on which I and my party would have a particular view. The cap should have been much lower and those funds should be redistributed within the sector. While the cap is voluntary in nature what are the Minister's view on it? I am aware it has been agreed at €150,000.

On the convergence issue, when the whole process commenced the European Commission was considering a flat rate system and the Department had different views. I felt there had to be a rebalancing of payments particularly to farmers in the west who suffered down through the years and smaller farmers who suffered due to the distribution of CAP on historical grounds. Farmers who reared and sold on stock for further grazing and the factory end were penalised by larger payments going to the bigger farmers and they were not able to compete.

The movement is towards 60% of the average payment, where the average payment per hectare will be approximately €150 or €152. Therefore, by 2019, every farmer would be on 60% of the average. The question is whether the Minister then has the scope to consider introducing a ceiling on the hectarage payments and whether that ceiling should be at a certain level. What is the Minister's view on that? I am not sure that scope is available, but my reading of the documentation gives me to understand it is. Should that be considered? There are farmers on payments of well in excess of €1,000 per hectare, while others are on very low payments per hectare and that has been the crux of the debate, particularly over the past number of months.

The link between productivity and single farm payments in regard to the level of hectarage payments should also be examined. All of the figures, including the latest figures from the Department, indicate there is no correlation or link between farmers with stocking density and those in receipt of high single farm payments. A table from the Department on the figures relating to the most productive farmers was discussed at yesterday's meeting of the Joint Committee on Agriculture, Food and the Marine and my colleague, Deputy Ó Cuív, has studied it in some detail. The majority of Irish farmers are on payments below the average of €250, but there are approximately 40,000 farmers in the category between the average and €400 per hectare. One could argue that they have been underpaid, because their production levels are extremely high. Is the Minister thinking of introducing a cap at €400 or €500 or €600 per hectare? Has he a figure in mind at this stage? Perhaps we can tease that out further later.

We all welcome the young farmers scheme, which is excellent. There is scope within the CAP to introduce a scheme for small farmers, which will mean they can receive up to €1,250 per year. Is it the view of the Department that this will happen from within the national budget? There is no mechanism built into the new CAP proposals for retirement. However, is there any way we can incentivise farmers to leave agriculture? Given that only 6% of European farm managers are under the age of 35, is there anything we can do to encourage older farmers to retire?