Theresa Ahearn
Question:199 Mrs. T. Ahearn asked the Minister for Agriculture and Food if, in view of the alarming decline in sheep farmers' income, he has any proposals to tackle this serious problem; and if he will make a statement on the matter.
Written Answers. - Sheep Farmers' Incomes.
The method of calculation of the ewe premium was adjusted as a result of an agreement reached by the Council of Ministers in 1989 on the reform of the sheepmeat regime. The new method which came into operation in full only in 1992 involved the calculation of the premium on the basis of the average Community drop in income rather than the income loss in individual regions. The level of the estimated ewe premium for 1992 on which the first advance of the 1992 premium was based, was calculated by the EC Commission on the new basis last June. This led to a reduction of £1.76 in the first advance of the ewe premium. This method of calculation led to a reduction of £2.05 in the second advance of the premium which was fixed on 23 October 1992. These losses are partly offset, in the case of producers in disadvantaged areas, by an increase of £1.31 in the Rural World Premium, the full amount of which was paid with the first advance.
The reduction in the 1992 premium foreshadowed by these first advances is occurring at a time when market prices are falling in a way which points to the fact that the alignment in market prices across member states expected at the time of the 1989 reform has not materialised. Ireland has been warning the Council and Commission for some time that this was likely. When our fears in this regard were borne out I immediately submitted a case to the EC Commission for an increase in the ewe premium because of the special circumstances obtaining in Ireland. I have discussed this case with the Commissioner on a number of occasions and impressed on him the importance of a positive response from the Commission.
I raised the matter at the July Agriculture Council Meeting. Again at my insistence, the serious situation facing Irish sheep farmers was placed as a substantive item on the agenda of yesterday's Agriculture Council in Luxembourg. At that meeting I emphasised the need for urgent action to ensure a positive response to my proposal to compensate producers for the impact of the changes in the premium arrangements which came into effect this year and for the fall in market prices. I again emphasised that the expected price alignment on which the reform of the market organisation for sheepmeat was based had not taken place and, as a result, a number of member states were receiving inadequate compensation for current income losses. I once again sought the support of my colleagues for a solution which would restore equity in regard to premium levels.
Both the Council and the Commission showed understanding and sympathy for the position of Irish sheep farmers and it was agreed that the Commission would examine the problem as a matter of urgency.