For Ireland, along with many other EU Member States, adequate
EU CAP funding is crucial, as it provides an essential support for the
agriculture sector in the respective economies. In Ireland, this sector provides an
essential platform for our largest indigenous industry, the agri-food and drinks sector, which accounts for 18% of
our total industrial output, employs approximately 150,000 people, and
generates an annual output of about €24 billion. This sector also makes a significant
contribution to our exports. For this
reason, the Irish Government is trying in current MFF negotiations to protect
CAP funding and keep it more in line with current levels.
Multiannual
Financial Framework (MFF) Negotiations
It is important to note that CAP negotiations can only take
place within the general context of MFF discussions, as the vast majority of
payments awarded under Heading 2 of the MFF are, in practice, given to the
agriculture sector and CAP funding.
This is due to the fact that Heading 2 addresses the use of natural
resources in sustainable growth. With
this in mind, the recent special Summit of the European Council on the 22 and
23 November must be considered. The
positions of the various Member States were found to be too far apart to
allow a budget to be drafted that was an acceptable compromise to all 27 Member
States. The MFF will be discussed
again at the European Council in early February 2013, and will therefore have
a key bearing on the prospects for agreement on CAP reform during the Irish
Presidency.
No consensus position was reached at the special Summit
largely because the current economic crisis has seen the positions of various
Member States split into two camps: those proposing cuts to EU contributions,
and against the EU cutting the rebates returned; and those opposing any cuts
to cohesion and other funding, such as agricultural. Ireland is firmly in the latter group. In practice, most funding under Heading 2
is allocated to the CAP, under Pillars 1 and 2. Pillar 1 covers ‘Direct Payments and Market
Supports’, and Pillar 2 covers ‘Rural Development’. This briefing will examine Ireland’s
position under these separate headings.
Implications
for Ireland
By this time next year, Ireland will have received more than
1.4% of the total EU budget (over €14 billion), for the 2007-2013
period. Of this, €12 billion will come
under the CAP, including over €1 billion per annum in Direct Payments to
farmers under Pillar 1, and roughly €348 million in rural development funds
under Pillar 2. When the Commission
budget blueprint was released in 2011, Ireland was of the view that it
represented a good starting-point for negotiations. However, there was concern that the amount
of money proposed in the blueprint for agriculture spending was the minimum
amount that would be necessary. These
concerns still hold.
The Irish
Position on Pillar 1 (Direct Payments and Market Supports)
For Ireland, the key issues relating to Pillar 1 in the MFF
and CAP reform are:
The size
of the CAP budget
From the outset the amount of money proposed for agriculture
spending was viewed as the minimum necessary.
In this context, throughout these negotiations Ireland has continued
to resist pressure from some Member States for further cuts in the
agricultural budget.
How the
EU will allocate the CAP funds between Member States
Ireland is generally happy with the method proposed for the
distribution of direct payments between Member States. The Commission has not yet indicated how it
will distribute rural development funds, and Ireland is arguing that it
should get its fair share, based on past performance.
Commission
blueprint proposals for connecting CAP funding to environmentally friendly
practices in the agricultural sector
The Commission blueprint states that 30% of CAP funding should
be tied to ‘greening’ efforts in the agricultural sector, and that it should
be flat rate in nature. Ireland would
have concerns about the accelerated move towards flat rates that this would
involve, and instead of a separate payment would prefer the ‘greening’ element
to be a percentage of each individual farmer’s overall direct payment. Ireland would also like to see changes made
to the three individual ‘greening’ criteria (permanent grassland, crop
diversification and ecological focus areas) so as to make them more operable
across all Member States.
Distribution
of payments within Member States (internal convergence)
The Commission’s proposal to move to flat national or regional
rates by 2019 would cause very significant transfers of funding between Irish
farmers. Ireland, supported by other
Member States who would similarly be adversely affected by such a move, has
called for a more measured approach based on the Commission’s own method for
the distribution of direct payments between Member States. This would limit the losses suffered by
individual farmers by moving only part, rather than all, of the way to the
average payment per hectare over the period.
Definitions
of an ‘active farmer’ and a ‘young farmer’
Ireland’s priority is to ensure the avoidance of payments to
non-farmers in a way that does not create additional bureaucracy. Furthermore, Ireland holds that Member
States should be allowed to identify objective criteria – for example, a
minimum standard of agricultural education – in order to ensure that the
young farmers’ scheme can be targeted at genuine young farmers. On small farmers, Ireland would prefer that
this scheme is optional for Member States.
The Irish
Position on Pillar 2 (Rural Development)
For Ireland, the key issues relating to Pillar 2 are:
- Apart from the overall funding for rural development mentioned earlier, the main concern arises in relation to the incorporation of rural development funding into what is known as the Common Strategic Framework, with other structural funds.
- Other issues such as the restriction of investment to farms of a certain size, the absence of a forestry premium for loss of income, the designation of areas of natural constraint and the potential effects of Pillar 1 greening payments on agri-environment payments are also of concern to Ireland.
Conclusion
Minister for Agriculture, Food and the Marine, Simon Coveney TD, has stressed that the full realization of Ireland’s agri-food
potential hinges on the attainment of a well-funded CAP and a measured reform
package that will continue to provide the basis for the sustainable
development of the Irish agriculture sector.
The next number of months will be crucial to the future of the Irish
agricultural industry and negotiations on an agreement will most likely conclude
during the Irish Presidency of the Council of the EU.
- The Team at European Movement Ireland
- The Team at European Movement Ireland
Source: www.europeanmovement.ie.