Nothing simple: the new CAP arrangements
CAP reform was meant to simplify the system but in reality, it has become more complicated. Richard Halleron reports on the changes which will create winners and losers in Irish farming.
While the powers-that-be in Brussels – EU farm ministers, the European Commission and the European Parliament – have done their job in agreeing the broad outline of a CAP reform deal, it is now up to all the member states to put in place a detailed package of measures that reflect the specific needs of their respective farming sectors. And the clock is ticking. Each country must notify Brussels of its new CAP support framework by the beginning of August this year.
The broad outline of the deal secured in Brussels almost a year ago will see the new support system introduced on an area basis and only active farmers will receive the money. In tandem with this, new environmental or ‘greening’ measures will be introduced across Europe. There will also be specific measures brought in to encourage young farmers. As a general response to the new CAP arrangements, Farm Minister Simon Coveney has clearly stated that they must be introduced in ways that will allow Ireland reach its Harvest 2020 growth targets.
Obviously, the issue of single farm payment entitlements – and who will own what after 2015 – is one that must be clarified by the Department of Agriculture. And, as a far as the various farm lobby groups are concerned, this couldn’t come fast enough. The matter is further confused by the reality that under the new CAP regime, entitlements can only be claimed by “active farmers”.
What is certain is that Ireland will have to start afresh in terms of deciding who draws down entitlements in 2015 and how these will be distributed. All of this brings into clear focus the subject of just how complicated the issue of CAP reform has become. And that, really, should not be the case.
Farm Commissioner Dacian Cioloș started down the road of the current CAP reform process some three years ago, promising us that we would have a more streamlined and straightforward CAP support system. However, the reality has turned out to be something entirely different – but that’s all rear view mirror stuff now.
The key requirement now is for Simon Coveney to lay out the enabling legislation for the new CAP arrangements over the coming weeks. This will give total clarity to all interested parties: farmers and landowners. Minister Coveney is, quite rightly, seeking a soft landing to the current milk quota regime. So, surely the same principle must hold when it comes to teasing out the deals of the new CAP arrangements.
From next year onwards, the single farm payment will be worth €1.3 billion per annum to the Irish economy. That’s a lot of money. However, it is crucially important that these monies go to the people that deserve them most. And in the context of the Harvest 2020 plan, this means ensuring that those farmers with the scope to grow their businesses are facilitated in every way. The recent downturn in beef prices is further proof that the market will always deliver the returns that producers need to make a sustainable living.
And, at the end of the day, that’s what this is all about – providing farmers with a degree of certainty regarding the future prospects for their businesses.
Meanwhile, Simon Coveney has let it be known that he does not want the Irish beef industry to become a by-product of the dairy sector. He has let it be known that further consideration will be given to finding ways of supporting suckler beef farmers moving forward. In so doing, he did not rule out a introducing a top-up to the €60 suckler cow headage payment, which was brought in courtesy of the last Budget.
Speaking at a recent press conference, he said: “My job is to spend public money in the most effective way possible. Government is currently working through the detail of the next Rural Development Programme and my aim is to use this in ways that will best meet the needs of the most vulnerable sectors within Irish agriculture.”
Simon Coveney also pointed out that agriculture and food represent the most important sector within the economy as whole: “The sector has managed to grow significantly over the past number of years and it is primed for further growth in the future. This will mean more jobs for the economy as a whole.”
The Minister repudiated any suggestion that farm incomes are at perilously low levels.
“Incomes within agriculture grew by 3 per cent in 2013. And we are likely to see a further jump in profitability this year,” he stressed.
“Dairy farmgate returns are at record levels and beef prices in Ireland are currently some 6 per cent above the EU average. Traditionally, Irish farmgate beef returns would have been well below this level. The days of Irish farmers producing cheap food are over. Irish food products are now recognised as ‘premium brand’ throughout Europe and beyond.”
But Simon Coveney was at pains to point out that Irish agriculture will need to be adequately supported over the coming years.
“That was why getting a suitable CAP deal put in place last year was so important,” he added. “The Common Agricultural Policy will put €12 billion into the Irish economy over the next seven years. This is a more than significant sum of money that will be used to maintain rural communities the length and breadth of Ireland.”
However, Fianna Fáil agriculture spokesman Éamon Ó Cuív has told eolas that the current Common Agriculture Policy (CAP) reform policies espoused by both Simon Coveney and the Irish Farmers’ Association are locking agriculture into a time warp that will merely serve to restrict the sector’s ability to grow over the next seven years.
“To refer to the new CAP support arrangements as being the outworkings of a reform process is being very disingenuous. Analysis of the current single farm payment distribution trends confirm that 400 producers are being grossly overpaid in terms of their current output while an equivalent number of producers are being significantly underpaid, when the current output of their farms is considered,” he added.
“The new arrangements, which the Minister has signed up to, only serve to lock the farming industry into production trends that existed 10 years and more ago. In reality, what we need is set of CAP measures that reflect the production practices of today. I firmly hold to the view that many of our most progressive farm businesses will lose out dramatically under the new arrangements.”
Turning to the new Pillar 2 support arrangements, which include the various rural development measures post-2015, Ó Cuív pointed out that they had a very strong dairy bias from a capital spend perspective: “This is a very unbalanced approach to take, particularly as the Minister has done nothing to improve DAS [disadvantaged areas] funding levels.” Commenting on the proposed Green Low Carbon Agri-Environment Scheme, which will replace the old Rural Environment Protection Scheme, the Fianna Fáil agri spokesman indicated that the funding available would be less than half that on offer under previous schemes.
“I find it particularly alarming that farmers with commonage will, effectively, be barred from the new measures. This is totally unacceptable and is an issue which the Minister must address as a matter of priority,” he concluded.
