Bernard Durkan (Kildare North, Fine Gael)
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Question 964: To ask the Minister for Agriculture, Fisheries and Food the action he has taken at EU level to ensure that steps taken in the course of the CAP health test to address the issues arising from CAP reform from an Irish perspective; and if he will make a statement on the matter. [11293/09]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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The deal I secured in the Health Check of the CAP negotiations last November is worth a potential €80 million in additional payments to farmers over the coming years. In addition, the increase in milk quota will deliver some €100 million worth of additional milk production by 2014. This is enormously positive for the sector and, while there are also elements in the package that I do not like, such as increased modulation, I am satisfied that this will not lead to any loss to Irish farmers.

The main aspects of the deal that are of interest to Ireland are as follows: Milk quotas will be increased by 1% per annum for each of the next five years (2009-2013). In addition an adjustment in the butterfat reference will mean the equivalent of an extra 2% in milk quota for Ireland in 2009. Two reviews of the market situation are planned, by December 2010 and by December 2012.

Due to our additional production potential, Ireland will benefit greatly from these changes. Including the 2% quota increase already in place for 2008, this means that an additional 500 million litres of milk will be produced in Ireland when these changes come into effect. This was an outstanding achievement given the alignment of forces on the Council. I am particularly pleased that our farmers and processors now have policy clarity and can plan their investments with a greater degree of certainty about the future.

As regards market support schemes, in essence, the key market management mechanisms that are most important to Ireland have been left completely unchanged.

I also was successful in obtaining the option of using funds from the National Reserve together with unused monies from the Single Payment funds allocated annually to Ireland to target at specific vulnerable sectors. There is approximately €7 million available in the National Reserve and I secured agreement to use these funds with effect from 2009. Under the final agreement, we will also have access to additional funds of the order of €25 million annually from unspent funds from 2010.

The funds can be used to address specific economic disadvantages affecting farmers in the dairy, beef and veal, sheep and goat and rice sectors. I persuaded the Commission to expand the scope of these measures to include economically vulnerable sectors irrespective of their geographical location. Yesterday I announced details of my decision to allocate the €7million becoming available this year to the sheep sector, specifically in the form of an Uplands sheep payment to be paid this year to eligible farmers. Once the Commission detailed rules become available on the requirements for 2010 onwards I will be making further announcements as regards the unused CAP funds.

Simplification is another area where I am pleased with the progress achieved and the commitment secured from the Commission and the Council as regards further simplification. The details of the simplification measures resulting from the Health Check have been well documented and I will continue to press for even further reduction of the administrative burden for farmers and administrations alike.

As to modulation, the rate has been increased by 5%. I would have preferred if no additional modulation was agreed. However, this was one element of the negotiations on which Commissioner Fischer Boel was particularly determined. I am satisfied that we succeeded in getting the rate of additional modulation considerably reduced from the original proposals. It is worth noting that over 50,000 Irish farmers will be exempt from this increase. I can confirm that there will be a budget neutral effect in respect of the 70,000 farmers affected by the change as I have ensured that all the funds raised can be passed straight back to Irish farmers.