Martin Kenny (Sligo-Leitrim, Sinn Fein)
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591. To ask the Minister for Agriculture, Food and the Marine if on signing up to CAP II he agreed to the implementation of a clawback on the leasing of entitlements; if so, the reason he has not implemented such a clawback; and if he will make a statement on the matter. [16278/17]

Michael Creed (Cork North West, Fine Gael)
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In accordance with the EU Regulations governing the operation of the Basic Payment Scheme, each Member State has the option to apply ‘clawback’ to the transfer of entitlements without land. Ireland opted to apply clawback on the sale of entitlements without land.

EU Regulations state that the application of "clawback" must not present a substantial obstacle or prohibition of the transfer of entitlements in a Member State. Ireland is one of the only Member States in the EU that operate a "conacre" system, and widespread corresponding short term leasing of entitlements.  In many cases the only option open to Irish farmers at risk of losing entitlements due to non usage is to lease entitlements without land to a farmer who has "naked" hectares to use them, thereby safeguarding their assets. The introduction of "clawback" on leased entitlements would present a significant obstacle to this option.

The option to lease entitlements without land is critical for many Irish farmers who are unable to obtain sufficient hectares of land to use their entitlements annually. Under the Single Payment scheme the rotation of entitlements safeguarded farmers’ entitlements but this is not available under the Basic Payment Scheme where 100% of farmers’ entitlements must be used at least once every two years. A large number of farmers in Ireland depend on the availability of affordable leased/rented land to use their entitlements. If farmers are unable to obtain leased/rented land through unavailability or high price they are at risk of losing their Basic Payment Scheme entitlements permanently through non-usage. In many cases the only option open to them is to lease their entitlements without land to a farmer who has naked hectares to use them, thereby safeguarding their assets.

Decisions in relation to Basic Payment Scheme entitlements including ‘clawback’ are made in consultation with the Direct Payments Advisory group which includes members of the main farming bodies and agricultural education and advisory services. Following consultation with this group a decision was made to reduce the level of ‘clawback’ on the sale of entitlements without land from 50% in 2016 to 20% in 2017. The group did not express support for the option to apply ‘clawback’ to the lease of entitlements without land.