asked the Minister for Agriculture and Food whether his Department have a view and an assessment on the impact of monetary compensatory amounts on consumer prices in Ireland; whether or not his Department are in consultation with the Department of Industry and Commerce in this respect; and the steps, if any, he is taking to ensure that the consumer in this case is protected to the maximum extent.
Written Answers. - Consumer Prices.
45.
Monetary compensatory amounts are applied under the Common Agricultural Policy to prevent the immediate results of currency exchange movements affecting the price support levels laid down. They operate as levies on export and subsidies on import in member states where currencies have declined in value. Where currencies have revalued they operate as levies on import and subsidies on export. The levies are paid into, and the subsidies paid from, the Community budget. While the application of MCAs in Ireland keeps consumer prices slightly lower than they would otherwise be, their main effect is to tax all exports of our main agricultural products. For this reason, and because prolonged application of MCAs leads to distortions of competition, it has been the policy of all Irish Governments to secure the elimination of our MCAs through green pound adjustment, and thus ensure that Irish producers and the Irish economy enjoy the benefits of the full common price level under the CAP.