I thank the Deputy for raising this matter on the Adjournment.
I fully acknowledge that beef producers have gone through a very difficult period since the beginning of this year as a result of the various reductions in export refunds last autumn and, more recently, the BSE crisis following the announcement by the British Minister for Health on 20 March in the House of Commons of the possible link between BSE and CJD. The difficulties being experienced by our producers are evidenced by the substantial fall in cattle prices since the beginning of the year, which has resulted in income losses for many producers. The Minister's objectives throughout the difficulties have been, first, to ensure that the market was adequately supported through the introduction of emergency intervention measures and, second, to secure compensation for the income losses arising from the BSE crisis.
Any reasonable commentator would acknowledge that the Minister has been very successful in achieving these objectives. The Commission introduced emergency intervention measures immediately after the onset of the BSE crisis. These arrangements have worked very well to date and have succeeded in disposing of most of the backlog of cattle which had built up on farms in the immediate aftermath of the announcement in the House of Commons. In any event, I am satisfied that the emergency intervention measures prevented a complete collapse in the market, not just in Ireland but across Europe.
It was always evident that the emergency intervention measures on their own would not be sufficient to support cattle prices at reasonable levels. For this reason it has been agreed that compensation will be paid to beef producers who suffered income losses because of the BSE crisis. The original Commission suggestions provided for increases in the suckler cow premium and the special beef premium at a cost of £540 million to the European Union. I understand that the compensation proposal, which is expected to be finalised by the Commission tomorrow, is likely to provide for greater flexibility to member states to use some of the compensation for specific measures targeted at those producers worst affected by the crisis.
The proposal will, of course, then be subject to negotiation in the Council of Ministers and will also require the opinion of the European Parliament. The Minister will seek to ensure that the final decision in the Council is framed in a way that best suits Irish conditions.
On the question of area aid applications, the EU allows correction by member states of "obvious errors" in such applications. One category of such errors is defined as purely clerical and containing no risk of fraud and includes boxes not filled in or information lacking, incorrect statistical or bank codes, mathematical errors, figures reversed — for example plot 169 instead of plot 196 — and incorrect plot numbers on applications which can be corrected by reference to accompanying maps. These errors can be corrected without notification from the applicant.
A second category of such errors is defined as less obvious than those I have mentioned and can be corrected only where the farmer notifies the error to the member state before he or she is made aware that an on-farm inspection is to be carried out on his or her holding. Confusion between acres and hectares is cited by the European Commission as one of the errors that falls into this category.
My Department uses the "obvious errors" provision to correct such errors. For example, if the area of a land parcel is shown on a map accompanying an area aid application as 23.7 hectares but is shown on the application as 27.3 hectares, my Department amends the area on the application to 23.7 hectares without penalising the applicant for that mistake. Likewise, if a map accompanying an application shows a land parcel which is omitted inadvertently from the application by the farmer, my Department can add that parcel to the application as long as the accompanying map makes it plain that the omission was an obvious error on the part of the farmer.
In addition to the flexibility given to my Department by the EU provision on "obvious errors", there is also provision in the relevant EU regulations for not penalising area aid applicants in respect of errors made by them on foot of "information recognised by the competent authority". If, for example, the contractor employed by my Department to digitise maps submitted by farmers between 1993 and 1995 digitises some of those maps incorrectly through the contractor's misreading of those maps rather than through errors made in them by the farmers and issues maps with contractor errors in them, then this paragraph of the EU regulations means my Department should not and will not penalise applicants for any mistakes on their 1996 area aid applications or accompanying maps that may arise from such contractor errors. Equally, if a Land Registry or Ordnance Survey map used by a farmer as the basis for his or her area aid application has an incorrect area for a particular land parcel shown thereon, then that farmer will not be penalised if he or she makes an error based on that incorrect area.
It is clear from what I have said that there is flexibility for dealing with obvious errors and with errors made on the basis of incorrect officially recognised information in relation to farmers' area aid applications. However, my Department has to be very careful to ensure that this flexibility, which is so useful in dealing with many cases, is not abused in categories of errors that do not fall into those I have outlined. The difficult situation in the beef sector cannot be used by my Department to extend that flexibility to other errors. However, I assure Deputy Kirk that the flexibility we now have will be applied to the maximum extent possible to all 1996 area aid applications.
