Other Questions

Horse Racing Ireland

Clare Daly

Question:

6. Deputy Clare Daly asked the Minister for Agriculture, Food and the Marine his views on corporate governance at Horse Racing Ireland; his plans to institute an inquiry into corporate governance at the organisation in the past five years; and if he will make a statement on the matter. [32195/16]

This question also relates to Horse Racing Ireland. I heard the Minister's reply to Deputy Martin Kenny. It suggested that, because the horse racing industry employed a lot of people and produced accounts, we should almost not be asking questions, which I found shocking. As a result of the process involved in the appointment of the CEO, as well as other allegations about staff and other matters, is it not time to have an inquiry into corporate governance in the organisation in the past five years? What has the Minister done to investigate the matter further?

Horse Racing Ireland, HRI, is a commercial State body established under the Horse and Greyhound Racing Act 2001 and responsible for the overall administration, promotion and development of the horse racing industry. The Deputy will be aware that the board of HRI has its own obligations in relation to compliance with corporate governance standards. In this context, I understand HRI operates a formal internal audit function which is outsourced to an external third party firm. I understand that, in its most recent corporate governance internal audit review in September 2015, HRI received a satisfactory assurance rating and that internal auditors did not raise any matter of significant concern. It is also the case that HRI publishes annual accounts which are laid before the Houses of the Oireachtas each year. These accounts are subject to external audit by the Comptroller and Auditor General and I expect HRI to engage constructively in that process.

I also understand HRI has arranged, through its legal advisers, for a detailed briefing and training on the new code of practice for the governance of State bodies which was recently published by the Minister for Public Expenditure and Reform. The Indecon report commissioned by my predecessor in 2012 reviewed certain aspects of governance and financing of the horse racing sector. Many of its recommendations in relation to governance have been taken on board in the Horse Racing Ireland (Amendment) Act 2016 which was finalised by my predecessor earlier this year. My Department has arrangements in place to monitor the activities of State agencies. In this context, it is also working on the development of a new formal written framework to formalise performance and compliance monitoring to reflect the provisions of the new code of practice.

HRI is a public body which is and will continue to be subject to significant levels of internal and external scrutiny, which is as it should be. I am aware that there have been issues relating to the sequencing of events in the recent appointment of the CEO. These have been acknowledged by the chairman and I have received written assurances that arrangements will be put in place to ensure the development by the board of a robust succession plan before the expiry of the current contract.

At the committee we heard members of the board state they were going to initiate the provision of training on corporate governance, the implication being it had not been provided before. Anyone who attended the meeting and watched the performance of board members could see that, while they were certainly interested in horse racing, their level of professionalism or, rather, lack of, was utterly shocking. There are huge amounts of public money at stake in this organisation. The figure is almost €250 million since 2011. The point has been made that, while the people on the board are clearly committed to the development of horse racing, it is a very small community. Opportunities may arise for many of the people concerned or their projects to benefit from some of the moneys that come through Horse Racing Ireland. I am not suggesting that is the case, but we need to be assured that it is not. To my mind, the only way to receive that assurance is through having a proper inquiry into corporate governance at HRI in the past five years. We would learn a lot and receive more than the assurance that has been provided, given the nature of the horse racing community.

There are other issues about staffing that were not aired at the committee. There were allegations about payments being made by the CEO, probably without the knowledge of the board, to settle workplace claims. There are the concerns about the high turnover of staff in HRI, bullying and so on. All of these matters have to be investigated.

On the amount of money at stake, it is substantial for a substantial industry which is estimated to be worth €1 billion and has approximately 14,000 employees. There is an accountability structure in place, with its audited accounts being subject to verification by the Comptroller and Auditor General. As I said to Deputy Martin Kenny, it is not a case of handing over funds without there being any accountability on the part of the board. In the context of the debate on the appointment of the CEO, at the committee the chairman of the board did acknowledge that the process was not as it should have been. That is the view of my Department and it is also mine. The board expressed the view that the outcome, albeit achieved in a rather circuitous manner, was the one it had desired and wished for.

I also made the point to Deputy Martin Kenny that the industry was very mobile. If one looks at the reports on the horse racing industry, it is to be found in every county in the country. It is important that we support it. It is not simply about handing over money that will find its way into the pockets of the big players. I acknowledge - this point was also raised by Deputy Martin Kenny - that there are issues around the viability of the industry at lower levels for those involved in point-to-point fixtures and breeding horses, etc. Many of them live for the dream, but to make it a reality, perhaps more resources must be provided at that level. The board could reflect on this issue. Collectively, we could make a contribution to its deliberations on it by expressing our concerns about that side of the industry. It is a great industry that provides great employment. It is a global leader owing to the people, the human capital, involved in it. The board has taken the lead in that respect, but it did not have its finest hour in dealing with this issue.

I have not seen any evidence to suggest the public moneys have not been used for horse racing projects and I am not suggesting it. However, given that the board is made up of people who have a stake in the industry and do not have professional expertise in corporate governance, what assurances do we have that some interests are not being promoted over others? That is the issue. Some projects, sweetheart deals or pet causes - we can call them what we like - are being pushed, while the greater good of the horse racing industry, in its broadest sense, is not being promoted. I am not the only one who has raised that question or concern. Many people with a real commitment to horse racing and who are involved at various levels are also raising it. There is also the high turnover of staff. A huge number of people are being lost and there are serious workplace claims and so on. Something is not right in the organisation. To me, the best way to protect all jobs and all of the good people who want to be involved for the right reasons is to have an independent inquiry into corporate governance at HRI in the past five years. That would give us a good picture of what is really going on.

In respect of all of the accusations the Deputy raises, it is interesting to note that the members of the board represent the various interest groups in the industry, including owners, breeders and staff. The full range of sectoral interests in the industry is reflected in the board. In theory, this should give rise to an appropriate consideration of all of the competing interests for scarce resources. I referred to the geographical spread of the resources provided to improve racing facilities for punters. This is manifestly broad in horse racing. Every industry with the significance of horse racing needs a flagship. The IRFU and the FAI have the Aviva stadium, the GAA has Croke Park and the horse racing industry also needs a flagship venue which will be the redeveloped Curragh racetrack. However, investment is spread across the country.

The various constituent members of the board are best positioned to articulate the competing demands for funding, of which there are many. We discussed the local issues of concern raised by Deputy Martin Kenny, on all of which the board, in its wisdom, is obliged to reflect. In terms of the decisions it makes in the allocation of funds, the audited accounts are available for public scrutiny and subject to commentary by the Comptroller and Auditor General. There are appropriate checks and balances. The alternative, that the Department micro-manage the industry, would not be appropriate. The composition of the board reflects the various elements of the horse racing industry. Horse Racing Ireland has, by and large, maintained Ireland's international standing as a leading player in the horse racing industry.

Question No. 7 is in the name of Deputy Jim Daly who is not present. Question No. 8 is in the name of Deputy Thomas Pringle who is also not present.

Questions Nos. 7 and 8 replied to with Written Answers.

GLAS Expenditure

Charlie McConalogue

Question:

9. Deputy Charlie McConalogue asked the Minister for Agriculture, Food and the Marine his views on payment levels for farmers under the green low-carbon agri-environment scheme; and if he will make a statement on the matter. [32323/16]

The question seeks to ascertain the Minister's views on payment levels to farmers under the green low-carbon agri-environment scheme.

GLAS is an agri-environment climate measure under the Rural Development Programme 2014 to 2020.  Its aim is to deliver environmental benefits which will protect and enhance our biodiversity and water quality and raise awareness of and encourage actions which mitigate the effects of climate change. The scheme contains actions which will deliver the expected environmental dividends and is the result of widespread consultation with stakeholders and protracted negotiations with the European Commission.

GLAS is a voluntary scheme in which participants elect to carry out specific environmental commitments. In order for a verifiable benefit to be achieved, the governing regulations require that these commitments must be delivered for a minimum of five years.  There is a wide range of actions to choose from in GLAS, providing scope for farmers across all types of farming system to submit applications and maximise their payment under the scheme. Some 25,800 farmers are actively participating in tranche 1 of GLAS, of whom 22,300 were eligible for a part year payment for three months in 2015.  A further 11,500 farmers have been approved in tranche 2.

GLAS is structured along three distinct tiers, with priority entry for farmers in tier 1, namely, those with priority environmental assets such as farmland bird habitats, commonages and high status water areas, followed by tier 2, with tier 3 farmers being allocated places last.  While the unprecedented level of applications under the scheme is in line with forecasts made by my Department, it has meant that for GLAS 2, priority had to be given to tier 1 and tier 2 candidates, namely, those who either manage key environmental assets such as endangered birds, protected habitats or high quality watercourses, or who have committed to undertake particularly valuable environmental actions such as growing feed crops for wild birds, adopting low impact tillage techniques or using low emission slurry spreading methods. Farmers had been urged to present the highest standard environmental plans under GLAS 2 and adopt actions that would promote them from tier 3 to a higher tier, thereby significantly increasing the chance of selection.  More than 80% of applicants in the second tranche of GLAS opted to do so and, with the funding available, they were approved.

Under the general scheme, a maximum payment ceiling of €5,000 per annum applies, but in the case of exceptional environmental commitments a participant may qualify for payment up to €7,000 under GLAS plus.  Applicants do not select distinct actions to qualify for GLAS plus. The increased payments available under this measure are automatically applied where the annual cost for a farmer of addressing a combination of tier 1 priority environmental assets, PEAs, exceeds €5,000. Farmers managing bird priority environmental assets can qualify for GLAS plus on the strength of their bird PEA alone, without the need for any other PEA, provided they manage an area of habitat sufficient to draw the additional payment.  The number of GLAS plus applicants will only become apparent when applications are finalised and have been fully costed.

This is the first full payment year for GLAS 1 and GLAS 2 and the first instalment of the 2016 payments to the 38,000 approved GLAS 1 and GLAS 2 farmers are due to start issuing towards the end of the year when all validation checks have been completed.  While the current average payment per participant is €4,600, no definitive information on the average payment will be available until all payments are made.

In February 2015, when the Minister's predecessor, the current Minister for Housing, Planning, Community and Local Government, Deputy Simon Coveney, first announced the green low-carbon agri-environment scheme, he indicated that €1.45 billion would be allocated specifically to it until the current Common Agriculture Policy programme expires at the end of 2020. As the Minister pointed out, the maximum standard GLAS payment will be €5,000. However, the average payment made thus far is €4,600 and total payments last year amounted to only €11 million. There are 38,000 farmers in the scheme, much fewer than the projected total of 50,000. The scheme will reopen at the end of 2016. If the full complement of 50,000 participants is reached by January 2017, farmers starting the scheme at the beginning of next year will only complete four years in GLAS under the current rural development programme because that programme expires at the end of 2020. As such, the maximum amount that could be spent by the end of 2020 is slightly more than €1 billion, giving a shortfall of €376 million on the projected expenditure of €1.45 billion, on which the previous Minister gave a commitment. I ask the Minister to ensure €1.45 billion is spent by the end of 2020 when the current rural development programme will expire. Farming incomes are in crisis. This money cannot be kicked out to the 2020s because it would result in farm incomes being hit this year and next year.

I want to nail this issue because the assertion that we will not deliver on the rural development programme and GLAS commitments is false. This year the Department is paying €40 million under the agri-environment options scheme, AEOS, a rural development programme that ran from 2007 until 2013. People joined this five-year programme in 2006 and 2007. The Deputy will recall that a previous Fianna Fáil-led Government suspended access to the rural environmental protection scheme. This year we will pay out €2 million under the REPS which operated under a previous rural development programme. These programmes of investment are constantly rolling over.

I hope the Deputy is not suggesting that when I reopen GLAS and people have the benefit of it in January 2017, they will only participate for three years, as that is not the case. The programme will be of five years' duration. The programmes roll over and the level of funding will remain the same. Despite the suggestion in the title of the rural development programme that it will operate from 2014 until 2020, the Irish rural development programme did not receive Commission approval until May 2015. For this reason, GLAS was opened in October 2015.

These are rolling programmes of investment and we will not leave behind a single penny. The Deputy should realise this because the Department is still paying out under the REP scheme that a Fianna Fáil-led Government suspended in 2008. In addition, we are still paying out under the agri-environment options scheme which featured in the 2007 to 2013 programme. The Deputy's statement was wildly wrong and misleading, but I congratulate him nevertheless as it will garner a good headline.

As I stated, when the Minister's predecessor announced the green low-carbon agri-environmental scheme in February 2015, he specifically stated €1.45 billion would be allocated to GLAS by the end of 2020.

It was to be allocated by the end of the rural development programme.

No, if the Minister checks, he will find that his predecessor stated €1.45 billion would be allocated by the end of 2020. That commitment garnered big headlines for the previous Minister. The Minister is now telling me that this was a bluff, that the then Minister, Deputy Simon Coveney, was engaged in headline grabbing and that the money will not now reach farmers until some time in the 2020s.

If I told the Minister I would employ him for six years at a salary of €145,000 up to the end of 2020, and I then came along and told him two or three years later he would still get the €145,000 but not until 2022 or 2023, he would not be very happy. That is what he is saying to farmers.

I would appreciate it if the Deputy did not abuse my leniency with regard to time. I call the Minister.

Farmers are losing income because of the failure of the Government to follow through on its commitment under the rural development programme up to the end of 2020.

Deputy McConalogue is persisting with misinformation.

It is the Department that has the misinformation.

His own pre-budget submission made no provision whatever for re-opening GLAS.

The Minister, Deputy Coveney, made a provision. The Minister, Deputy Creed, is saying that is not accurate.

Anybody who joins the scheme gets a five-year cut at it. The Deputy is suggesting I should have a cut-off point in 2020 whereas those who get their payments in 2017 will have five years. The State is paying the AEOS and REPS grants because these payments roll over. They are not so cleanly defined, cut and packaged as to be for exactly five years. Every penny provided under the rural development programme for the period 2014-20 may not be drawn down within that calendar period but it will be available. Therefore, somebody who goes into the scheme in January of next year will get a five-year payment, so payments will run until at least 2021.

The Minister is bluffing farmers.

The Deputy's budget proposal did not have a penny for GLAS.

Before we move to Question No. 10, I point out to Deputy McConalogue I have been very lenient with the time and I ask him not to abuse my leniency. I will cut the question after six minutes, whether the Deputy has come back in or not.

Sheepmeat Sector

Charlie McConalogue

Question:

10. Deputy Charlie McConalogue asked the Minister for Agriculture, Food and the Marine if he will provide details on the new sheep scheme to be introduced in 2017; and if he will make a statement on the matter. [32321/16]

I ask the Minister to give details of the new sheep scheme and when in 2017 it is due to start.

A Programme for a Partnership Government commits to the introduction of a scheme for sheep farmers under the rural development programme with a budget of some €25 million to be provided in budget 2017. The commitment is a clear acknowledgement of the contribution the sheepmeat sector makes to the Irish agri-food sector, generating an output value of €320 million in 2015 and supporting some 35,000 farm families directly as well as providing several thousand jobs indirectly in rural areas.

The new sheep scheme proposed for 2017 will be additional to existing supports available to sheep farmers under the basic payment scheme, GLAS, the areas of natural constraint scheme and TAMS, and will make a vital contribution to ensuring the continuing viability of the sheep sector in Ireland. In designing the scheme, I am aware of the different challenges facing sheep farmers in the different areas of sheep farming carried out in Ireland. I believe this scheme will provide a lasting benefit to sheep farming and demonstrates and acknowledges the contribution sheep farming makes to the agri-food sector in this country.

As regards the specifics of the scheme design and operation, my Department has engaged in extensive consultation with farm organisations and has met with officials of the European Commission to discuss the proposed new scheme in the context of the specific requirements of the rural development programme. The scheme is being proposed as an animal welfare scheme under Article 33 of the rural development regulation and all actions will have to improve animal welfare conditions for flocks within the scheme. The proposed scheme has been submitted as part of Ireland's second amendment to its rural development programme and is currently being considered by the European Commission, along with other proposed amendments to the rural development programme. Subject to a successful outcome to these negotiations, I am hopeful we will be in a position to launch the scheme in early 2017.

The shape of the scheme will ultimately depend on the terms of the Commission approval and I do not want to prejudge the outcome of that process. However, I can indicate that the proposal presented comes under the animal welfare heading in the rural development regulation, and includes activities that can assist farmers in areas such as lameness control, flystrike control, scanning of pregnant ewes, meal feeding of lambs post weaning, mineral supplementation for lambs and ewes and faecal egg counting for detection of worms and other parasites. I will provide other scheme details as soon as my Department has received Commission clearance.

Scheme payments may be made only on the basis of costs incurred or income foregone as a result of the required actions. Those actions must be verifiable and controllable and go beyond normal standards of husbandry practice before they can be considered as an eligible cost incurred by a farmer and must demonstrate a clear benefit to animal welfare.

Additional information not given on the floor of the House

I am also anxious that such a scheme takes into account the different production systems in the Irish national sheep flock and recognises the different challenges facing both lowland flocks and hill flocks. It is my intention that the scheme’s design will maximise the number of participants and deliver tangible benefits to the sheep sector in terms of its impact on on-farm practices.

We very much welcome the €10 per sheep scheme, which will be important for the sector. There are just under 13,000 sheep farmers, with an average income of just under €16,000 per year. It is a sector where incomes are particularly challenged and where we have to ensure there is support so that flock numbers are kept up. It is important the scheme begins early in 2017 so we can ensure it gets up and running and that the funding actually comes to farmers. The Minister might clarify how early in 2017 he hopes the scheme will be up and running. The other key point is that the costs of administration of the scheme are kept as low and as manageable as possible in order to facilitate farmers.

With regard to the issue of the menus available to farmers, will there be one menu for all types of farms to choose from? For particularly challenged sectors such as the hill farm sector, is it possible they will be able to choose additional options and, therefore, be paid more than the €10 to try to protect sheep numbers in those areas?

To clarify, there are over 35,000 farm families involved in sheep production. Interestingly, they are predominantly but not exclusively concentrated on the western seaboard, with Donegal, Galway and Mayo having the highest concentration of sheep farmers. It is a welcome investment in the western seaboard counties in particular.

There will be a different menu of options reflecting the different management practices of hill sheep farmers and lowland sheep farmers, which is important. When it gets up and running is contingent on when approval comes from the EU. I would like to have the applications issued in early 2017. I acknowledge the highest costs incurred by sheep farmers are in the late spring and early summer, so in an ideal world that is when we would like payments to issue. However, that is subject to receiving applications, cross-compliance checks and so on. I cannot be definitive about that and it may well be later than that when payments are made.

This reflects a significant investment in the industry, which has stood in line long enough. There are other related matters the industry will have to grapple with in regard to electronic tagging which, although not contingent on this scheme, is becoming an issue in respect of market access for our exports. We opened a new export opportunity in Iran recently. I am committed to publishing a consultation paper in that area in order to get the maximum possible consensus on how we might address traceability issues in the sheepmeat sector.

The Minister might elaborate on the menus and whether it will be the one menu for all farmers. There is also the issue of additional payment to hill farmers. Is this something the Minister can consider?

I had previously answered on the latter issue. There is no proposed variation of payments and it will be a flat rate payment for all sheep farmers.

In my reply, I listed the menu of options, which will include activities in areas such as lameness control, flystrike control, scanning of pregnant ewes, meal feeding of lambs post-weaning, mineral supplementation for lambs and ewes and faecal egg counting for detection of worms and other parasites. Some of these will be more practical for hill sheep farmers and some will be more practical for lowland sheep farmers, but that is the menu of options they will have the choice of buying into.

Harness Racing Industry

Martin Kenny

Question:

11. Deputy Martin Kenny asked the Minister for Agriculture, Food and the Marine his plans to provide funding to the Irish Harness Racing Association following its provision of a training course to encourage participants in the sport to come off-road and use safer regulated facilities. [32186/16]

I understand the Irish Harness Racing Association has done great work in this regard and it is looking for a very small amount of money compared to other areas of the equine industry.

The Irish Harness Racing Association, IHRA, is a beneficiary, for the first time, of an equine infrastructure grant scheme operated by my Department. The IHRA has been approved for grants totalling €21,704 under this scheme, with a view to supporting this sector in a targeted way.

The tender for an independent evaluator to complete an economic evaluation of the potential of the harness racing sector in Ireland is now well advanced and it is hoped that an evaluator will have been appointed by early December. As I stated previously, on publication of this economic evaluation, I will consider the request for funding for this sector. Until that time, no further funding requests can be considered.

That is disappointing considering that in other countries, particularly France, the industry is huge and generates considerable income. It has great potential here so it would be appropriate to try to put a small amount of money towards it at this time. Those concerned are not looking for much; they have applied for under €60,000. If this could be allocated to them until they get the industry established, it is quite likely they will be able to develop a self-financing industry in the near future, as in other sectors. The industry needs to be kick-started. We are talking about priming the pump. It would be appropriate to try to do that. Harness racing provides a great social service, as the Minister is aware. People who have engaged in harness racing on the roads in the past, including those from the Traveller community, are trying to regulate the industry, get it indoors and make it something everyone can enjoy and in which everyone can participate. It is an industry that requires a very small amount of money compared to many others. It would be very appropriate to fund it at this time.

I have received quite a lot of representations on this matter. We have discussed it previously also. I acknowledge there is significant interest and that the industry is part of the overall horse racing industry that we discussed previously. The Deputy seems to be able to cherry-pick the elements of the horse racing sector that he likes and dislikes. Harness racing is part of the horse racing family, however.

I am open to paying additional money in principle but the Deputy will appreciate that I would be hauled in here if I did not have a sound economic rationale for doing so. That is why we are appointing somebody to assess the economic contribution, how the industry might develop, how it should be structured and how we should invest in it strategically. This approach is lacking somewhat in the proposals we have received to date.

It would be a dangerous precedent to start getting involved in subventing retrospectively costs incurred without providing any underlying economic rationale. Therefore, we await the evaluators' report. If this sector has potential — I have no reason to doubt the Deputy in this regard — I am sure it will be reflected in the report and that we will have a sound economic rationale on which to consider how best to assist the industry in the future. The Deputy will appreciate that I cannot dispense taxpayers' funding willy-nilly without the rationale. If I did, I might find myself before the agriculture committee.

The Minister would be very welcome at any time before that committee.

The industry sits in a different place from where we spoke about earlier. I refer to the way the money is being spent in the horse racing industry, benefiting those who are very long established and very well established. We have an opportunity to do something that would reflect that the Government is prepared to fund not only those at the very top of the industry but also those at the bottom starting off. It would be appropriate to put some money towards it. Those concerned do not require very much. While I understand a report will be commissioned, could the Minister commit to putting a substantial plan in place for the industry as soon as it is prepared?

I do not want to prejudge the report. Based on the premise of the picture the Deputy painted, it should give us a roadmap as to how best to assist the industry to develop. I await the report and I will have no difficulty publishing it in due course.

Agriculture Scheme Payments

Martin Kenny

Question:

12. Deputy Martin Kenny asked the Minister for Agriculture, Food and the Marine the measures he will take to include the group of farmers known as "old young farmers" who are excluded from entitlements due to their having been farming before 2009 but who are still under 40 years of age. [32185/16]

What measures will the Minister take to include the group of farmers, known as "old young farmers", who were excluded from entitlements due to their having been engaged in farming before 2009 but who are still under 40 years of age? They comprise a small group who feel very neglected and left out of the whole system just because they happened to start farming before 2009. Many got into the industry and rented land at a young age only to find they are now being excluded and cannot get the same entitlements and supports as other farmers. The number involved is small enough so this could be sorted out relatively easily if the Government had the will to do so.

In accordance with the EU regulations governing the national reserve and the young farmer scheme, a "young farmer" is defined as a farmer aged no more than 40 years in the year when she or he first submits an application under the basic payment scheme and who commenced farming activity no more than five years prior to submitting that application. The regulation also provides that priority under the national reserve is given to "young farmers" and to "new entrants to farming". A new entrant is defined as a farmer who commenced agricultural activity during the previous two years. The regulations governing the operation of the national reserve also include an optional provision whereby member states may use the national reserve to allocate new entitlements or give a top-up on the value of existing entitlements for persons who suffer from a "specific disadvantage".

Following my Department’s consultation with the EU Commission, the then Minister announced in March 2015 that the group commonly known as "old young farmers", who established their holding between 1 January 2008 and 31 December 2009 and who, due to the timeframe of setting up their holding, did not benefit from either the installation aid or the young farmer category of the national reserve, can be considered a group suffering from specific disadvantage. The result is that this group was eligible to apply under the national reserve measure of the 2015 basic payment scheme. Some 280 applicants were successful under the old young farmer category of the 2015 national reserve.

The Deputy may also be referring to the group of farmers commonly known as the "forgotten farmer" group. This group comprises farmers aged under 40 who established their holdings prior to 2008 and who hold low-value entitlements. Preliminary analysis carried out by my Department shows there are some 3,900 farmers in this category. An estimation of the cost of increasing the value of existing entitlements to the national average for these 3,900 farmers stands at over €12 million.

There was no national reserve in 2016 as all available funding, €24 million, had been utilised under the 2015 scheme. In order to provide for a national reserve in 2017, funding is required to replenish the reserve. EU regulations governing the scheme provide that funding for the replenishment of the national reserve may be obtained by means of surrender of entitlements that remain unused by farmers for two consecutive years and by claw-back derived following the sale of entitlements without land. It is envisaged that funding derived from these two sources in 2017 will be very limited. The regulations also provide for the application of a linear cut to the value of all farmers’ entitlements to replenish the national reserve.

Additional information not given on the floor of the House

Under the national reserve, priority access must be given to the two mandatory categories of "young farmer" and "new entrant to farming". Support for other categories, such as those that may be regarded as suffering from "specific disadvantage", can only be considered once the two mandatory categories have been catered for. EU Commission approval would be required to have the forgotten farmer group included under the specific disadvantage category of the national reserve. Information submitted to the Department on behalf of this group of farmers indicates that many have established holdings as far back as the 1990s.

In order to qualify for the national reserve, all applicants must have achieved the required level of agricultural education at FETAC level-6 standard and comply with the off-farm income limits pertaining to the national reserve. Decisions in regard to the national reserve for 2017 will be considered once the position on potential funding has been established.

There is a programme for Government commitment to trying to resolve this. This is clear and something needs to be done about it.

With regard to European regulations, my understanding is that Europe is open to finding a solution to this. I have heard this from people in Europe who met representatives of the Commission and believe a scheme could be put forward that would resolve this problem.

With regard to the national reserve, I understand the cap will be lowered next year such that no farmer will be able to claim more than €100,000. This should leave room to do what I propose regarding the national reserve.

The Minister said nearly 4,000 farmers are affected. I understand the number is considerably smaller. At this point in time, they will be seeking to have the supports in place. The budget was an opportunity for that. Sometimes issues that do not cost a lot of money can be resolved. It is a missed opportunity not to try to resolve this matter for the farmers. They are left with nothing.

This is an issue that requires European Commission approval. That is not easily available based on my conversations with the Commission. There is a mid-term review of the CAP coming up, however, and we will continue to explore the possibility of resolving the matter for the farmers affected.

Even if we were permitted to do as proposed, it would then be a question of what is in the reserve. If I do not use my entitlements for two years, they are lost by me and enter the reserve. If I lease my entitlements to the Deputy, there is a claw-back into the reserve from the lease of some entitlements. The problem with that approach is that if I make an allocation, I have no choice but to make an allocation to every individual applicant that is the equivalent of the national average. That process, of clawing back or entitlement surrender, would not nearly be sufficient to deal with the 3,900 individuals. The alternative would be to make a linear cut across every farmer's entitlements. To ensure I could deal with the 3,900 through entitlements, I would have to cut every payment by the required percentage to bring the value up to the required level. The Deputy might have a different view if this were to happen. It is a complicated area but we are committed to exploring it as far as we can with the Commission.

Can I take it that the Minister is making a commitment that in the mid-term CAP review he will seek a solution from the Commission? I understand that maybe Ministers are doing their best in this situation but, in fairness, it is a small enough number of farmers, and I do not think enough effort has been put in to try to resolve this issue to date.

To be fair, the Department did succeed in addressing the entitlement to treatment from the national reserve for the group referred to as "old young farmers". This is a less clearly defined group. They are the forgotten farmers. They are not a homogenous group; their circumstances vary. Some of them may not even have the fundamental prerequisite of the green certification. It is a challenging issue. We have had discussions with the Commission about it. We did not get a lot of traction on it but we will re-engage with the Commission in the context of the mid-term review. It is challenging. However, even if we get permission in principle to deal with it, how we get entitlements into the national reserve for them is then an issue that must be grappled with. There is not much appetite, particularly in the current climate, to make a linear cut across every single farmer's payment to ensure that these people are looked after, so it is not as simple as the Deputy thinks it is.

Brexit Issues

Bernard Durkan

Question:

13. Deputy Bernard J. Durkan asked the Minister for Agriculture, Food and the Marine the extent to which he continues to interact with his colleagues in Northern Ireland and in the UK in the context of making the necessary preparations to safeguard the interest of the agrifood industry here in the aftermath of Brexit; if he has identified specific issues deemed to be fundamental in this regard; if he expects to make progress on any such issues in the near future; and if he will make a statement on the matter. [32282/16]

This is an attempt to identify the initial soundings that may have taken place or may be taking place regarding the situation that will arise after Brexit and the extent to which soundings have been made with the UK authorities, the authorities in Brussels and perhaps our colleagues in Northern Ireland.

The UK remains by far Ireland's most important trading partner as far as the agrifood sector is concerned, with a trade surplus of €1.3 billion last year. There are also significant levels of trade in agri-sector products between North and South. In 2015, we exported almost €750 million of agrifood sector products to the North, of which beef represented €133 million; live animals represented €99.8 million; beverages came to €89 million; cereals and cereal preparation, €84.4 million; dairy products, €68.5 million; fruit and vegetables, €53.3 million; and forestry, €48.7 million. By contrast, we imported almost €569 million worth of agri-products from the North for the same period, of which dairy produce came to €171 million; animal foodstuffs, €90.7 million; cereal and cereal preparation, €71 million; fruit and vegetables, €43.9 million; poultry, €35.8 million; and forestry, €22.7 million.

It is of course vital, therefore, that we maintain the very closest contact with our counterparts in Northern Ireland and in the UK, at both political and official levels, and this work is well under way. A number of meetings have taken place to date, with further meetings anticipated in the coming months.

From a North-South perspective, at the North-South Ministerial Council plenary meeting held in Dublin Castle in early July, I agreed with my Northern counterpart, Michelle McIlveen, that officials from both jurisdictions would meet as soon as possible to work through some of the potential issues involved. The first meeting of officials took place on 22 July 2016. The Department of Agriculture, Food and the Marine followed this up with the preparation of an "audit" of Brexit implications from a North-South perspective.

A further meeting between my Department's Secretary General and the Permanent Secretary of Northern Ireland's Department of Agriculture, Environment and Rural Affairs took place in Dublin on 4 October. It was agreed at that meeting that officials from both jurisdictions would co-operate closely on areas of specific concern, including the potential agrifood implications of a hard or soft Border, trade and tariff issues and animal health and fisheries. Brexit was also discussed at yesterday's North-South Ministerial Council agriculture sectoral meeting in Armagh.

As regards UK contacts, my Department's Secretary General has had a number of meetings with his UK counterpart. Both parties agreed to monitor the situation closely over the coming months. In the meantime, I have made arrangements to meet my UK counterpart, Andrea Leadsom, in London on 1 December.

I thank the Minister for his comprehensive reply. Arising from the contacts made so far, and having regard to the likely attitude of Brussels, has he been reassured that it will be possible to continue inasmuch as possible the relationship that has existed heretofore not only regarding this jurisdiction's association with the European Union, but also with Northern Ireland?

We only have time for a brief reply because the time is up, so I would appreciate if the Minister could keep his reply as brief as possible.

Very briefly, reassurances are difficult to find because there are so many moving parts to the Brexit scenario, and until the UK puts its cards on the table in terms of what its ask will be, one would be wise to take with a grain of salt any reassurances given. However, in respect of my meetings at the North-South Ministerial Council and other meetings I have had with my Northern Ireland counterpart, I think there is an acknowledgement that we have areas of mutual concern and interest in respect of that trade North and South, which I have identified in value terms, and the complexities that arise post-Brexit in facilitating the continued existence and growth of that trade. We must continue to work on these matters. As I said, yesterday we had that meeting at which we made progress.

I appreciate the co-operation of Deputies. Our time is up. I thank the Minister for coming in and answering those questions and all the Members who participated as well. Buíochas do gach éinne.

Written Answers are published on the Oireachtas website.