Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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Question 340: To ask the Minister for the Environment, Community and Local Government the progress made to date on addressing the issue of funding food projects under the Leader programme; and if he will make a statement on the matter. [2313/12]

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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1The Rural Development Programme 2007-2013 (RDP) is divided into 4 Axes. Axis 1 deals with competitiveness of the agricultural sector, Axis 2 aims to improve the countryside and environment and the objectives of Axis 3 are to support the diversification of the rural economy and improve the quality of life in rural areas. Axis 4 or the LEADER Axis provides support for the use of a "bottom up" approach to development which ensures that local people are involved in the decision making thereby facilitating sustainable development in a more inclusive way. In Ireland the LEADER approach is used to implement Axis 3 measures.

A significant number of projects funded under the previous LEADER+ programme (2000-2006) and under the Diversification and Business Creation measures of the current RDP involve support for enterprise initiatives that add value to agri-food products. Basic Agricultural products are listed in Annex 1 to the EC Treaty and are commonly called Annex 1 products. Under the main Rural Development Regulation 1698/2005 support/grant aid for adding value to Annex 1 products is facilitated under Axis 1 of the programme. At the start of 2011 Ireland was notified by the European Commission that support/grant aid for adding value to agri-food products is not eligible under Axis 3 but rather under Axis 1, which is delivered by the Department of Agriculture, Food and Marine. As a result of this, grant aid under Axis 3 of the RDP for this type of activity is currently suspended.

My Department is continuing to work with the Department of Agriculture, Food and the Marine in pursuing a solution in the context of the overall budgetary situation.