Vol. 533 No. 5
8 Mr. Shatter asked the Minister for Agriculture, Food and Rural Development his views on the EU Commission proposal to introduce a fixed ewe premium; if so, the level at which such a fixed premium should be set; and if he will make a statement on the matter. [9243/01]
There is not at this stage any EU Commission proposal to introduce a fixed ewe premium. This suggestion was included in a consultant's report to the Commission as one of a number of possible amendments to the EU sheepmeat regime. The Commission's response to this report in the form of formal proposals is still awaited, although it is expected shortly.
While a fixed premium has some advantages over a variable premium, particularly in that it provides a greater degree of certainty to producers about the level of the premium, it has the significant disadvantage that, unlike a variable premium, it is not increased when prices fall. In view of this, in the event that the Commission comes forward with a proposal for a fixed premium, I will seek to have the premium fixed at a significantly higher level than that which has obtained in recent years.
Is it Government policy to accept the concept of a fixed ewe premium?
The position is as I have outlined. We will not buy a pig in a poke – in other words, one has to know the shape and level of what is being proposed.
A sheep and a pig.
So long as it is disease free. It is much too early yet. What will determine this matter is that the advantage would lie with the farmer. Until a formal proposal is made and there is an indication of the level of payment one could not hazard a guess on which way the ball will bounce. At the end of the day what will inform the decision will be the proposal that would most benefit the farmers on the ground.
Will the Minister of State acknowledge that Irish farmers have got the wrong end of the stick on the variable ewe premium for some time? Does he accept in the event of a fixed premium that it would be fixed for the whole of Europe? The fact that European farmers will receive higher prices for lambs must mean that Irish farmers will be at a significant disadvantage.
The devil is always in the detail. One would be foolish to state in which direction one is going until one has a decent proposal. This issue is determined by the mechanism put in place and whether there is a safety net if prices go through the floor. This matter is of concern, particularly to lowland farmers who have greater productivity per ewe and on whom falling prices have a disproportionate effect in terms of income.
We have to be careful to see how the situation evolves and to make sure our decisions are not divorced from the reality of what is most advantageous for farmers in the long term as regards payments. Legitimate concerns have been expressed that the premium as it has operated has not been a fair reflection of market prices received by farmers. This issue has been debated at length and it is good that it is now being re-examined. However, we must be careful to ensure we get the maximum advantage from any change to the regime.
I still do not know where the Minister of State stands on this issue.
