Michael Healy-Rae (Kerry South, Independent)
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Question 421: To ask the Minister for Agriculture, Food and the Marine his views on the fact that the Irish Cattle and Sheep Farmers Association are warning farmers that they could see the price increases over the last number of years being eroded under the impact of CAP reform in view of the fact that it is expected that 33%, that is 56,000 farmers, could lose; and if he will make a statement on the matter. [24130/12]

Simon Coveney (Cork South Central, Fine Gael)
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One of the proposals in the CAP reform package currently under negotiation is to move away from direct payments based on individual farm historic production references to a system based on uniform regional or national rates of payment per hectare by 2019. While I accept the need to move away from outdated historic references, I have serious concerns about the extent and pace of changes proposed by the Commission.

Extensive modelling conducted by my Department shows that the application of a national flat rate of payment per hectare would result in average gains of 86% for some 76,000 Irish farmers and average losses of 33% for almost 57,000. Similar levels of average gains and losses would occur with the application of flat rates on a regional basis. These are average percentages, and some of the gains and losses would be far larger than this. In general it is clear that the losses would be incurred by more productive farmers. This would have undesirable consequences at a time when Ireland is trying to encourage sustainable intensification in the agri-food sector, as we strive to achieve the objectives in the Food Harvest 2020 strategy.

I have been pressing for the maximum possible flexibility to be given to Member States to design payment models that suit their own farming conditions, and to adopt a more gradual, back-loaded transition process, rather than the very rapid, front-loaded approach proposed by the Commission.

I would like to have the possibility of putting a limit on the amount any farmer could lose in any redistribution. This would be consistent with the Commission's desire to achieve a more level playing field, but would avoid a disruptive level or pace of change. The 'approximation' approach, by which all payments could gradually move towards, but not fully to, the average, is one alternative that I believe should be considered in this regard. The Commission's "pragmatic" proposal for redistribution between Member States is, in effect, an approximation approach and provides a useful precedent.

I have been very active in seeking allies for this position, and I have been making significant progress, particularly with a group of Member States with somewhat similar concerns. However, it should also be understood that a majority of Member States have no difficulty with the idea of flat rate payments, although they have concerns about other aspects of the proposals.

The negotiation process on CAP is a complex and difficult one, but all of my efforts are focused on achieving the best possible outcome for Ireland. These efforts will be continued over the coming months as the process evolves, and will further intensify during our Presidency, during which Ireland will work with other Member States, and with the European Parliament and the Commission, to secure an agreement that will provide an appropriate policy structure for the agri-food sector over the coming years.