JOINT COMMITTEE ON AGRICULTURE, FOOD AND THE MARINE debate -
Thursday, 19 Jul 2012

European Council: Discussion with Minister for Agriculture, Food and the Marine

Chairman

I welcome the Minister for Agriculture, Food and the Marine, Deputy Simon Coveney, and his officials. I thank them for coming before the joint committee to brief members on the outcome of the recent European Council meeting and discuss the issues of herring quotas, fishery harbours and centres, rates and charges. As members will be aware, the orders of the committees agreed to by the Houses in June 2011 reflect the programme for Government by requiring committees to consider European matters within the remit of the relevant Departments and engage with Ministers in the context of meetings of the Council of Ministers as part of the new mainstream model of European Union affairs. Since the restructuring of committees, this committee can concentrate on issues relevant to the Department. As part of the new process, we invited the Minister to brief the committee. The former committee had a meeting with the Secretary General and other officials in May to discuss six monthly reports and proposed measures and developments within the Department in EU matters. The committee is grateful to the Minister and his officials for their continued co-operation.

On the matter of privilege, members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against either a person outside the Houses or an official, either by name or in such a way as to make him or her identifiable.

Does the Minister wish to discuss the meeting of the Council of Ministers first?

Minister for Agriculture, Food and the Marine (Deputy Simon Coveney)

I am in the hands of the Chairman. I know there are a series of matters the committee would like me to address. I would like to get into questions and answers with members so that I am answering their questions. I also want to give the committee a general briefing on what is happening, particularly around the Common Agricultural Policy reform process and the mackerel situation, which is hugely significant particularly for Killybegs and our pelagic fleet. Quite a lot happened at the Council this week on those two matters.

I know members of the committee want to discuss the recent herring review, concerning the track record and access both for the Celtic Sea and north-west herring, as well as discussing harbour charges. We have been through a public consultation process having published harbour charge proposals. We made significant changes on the final harbour charges agreement order, which I can go into in some detail if members so wish.

I am in the committee's hands and we could talk for the next four hours about these issues but we do not have that kind of time. I want to make sure, however, that I am dealing with issues the committee wishes to discuss. If members so wish, I could give a ten-minute outline of the key issues of this week's Council meeting. I had a bilateral meeting with the Commissioner Mr. Ciolos, which is worth talking to the committee about. I raised, as forcefully as I could, my concerns on the ongoing behaviour of Iceland and the Faeroe Islands concerning mackerel stocks and the impending crisis that is coming as a result of that situation, unless it is dealt with. I can brief members on the current position and the likely outcome. I suspect that some members of the committee want to hear details of the rationale behind the herring review. There seems to be some concern about the outcome of that. I want to be clear on why and how the decision was made as regards applying track record rules and so on.

Is that order okay for the committee?

Chairman

If the Minister could give an outline, members can then put questions. I propose that we will break it down to issues surrounding the Council meeting and the Minister's bilateral meeting with the Commissioner.

Deputy Simon Coveney

We could perhaps first cover CAP reform, to get that out of the way. Most members will be familiar with them. We could then do mackerel, herring and harbour charges, one after the other.

Chairman

That is fine.

Deputy Simon Coveney

If I give a presentation on all of this material, I will be speaking for the next 40 minutes.

Chairman

No, just take one issue at a time.

Deputy Simon Coveney

Okay. Let me give an update on some of the key matters surrounding CAP reform. This will become a major issue in the autumn and into the Irish EU Presidency next year. It is important that people are up to speed on what I have been doing because I would like feedback on whether the committee thinks we are taking the right approach.

The most important issue this week concerning CAP reform was a bilateral meeting I had with the Commissioner for Agriculture and Rural Development, Mr. Dacian Ciolos, rather than the Council debate. The latter was important but is not as key an issue for Ireland because it predominantly discussed market measures to deal with price fluctuations. There were some comments on milk prices, as well as issues concerning a soft landing. What was most interesting was a discussion with the Commissioner on how he saw things unfolding from now until a decision is made on the Common Agricultural Policy reform process.

There is now an increased likelihood that we may get what is called the MFF - the multi-annual financial framework, which is the EU budget for the next seven years - agreed in December. If I had been asked three weeks ago when we were likely to get the MFF agreed, I would have said next March at the earliest, in the middle of the Irish Presidency. Now, however, I believe there is an increased likelihood that it may get done in December. There are political reasons for that. One of the drivers for it is that there will be an election next autumn in Germany and they are anxious to get agreement on the budget long in advance of that, as well as getting other agreements on the Common Agricultural Policy and the Common Fisheries Policy that will be needed following the MFF agreement. They would like to have those difficult political negotiations well out of the way before an election, otherwise one could find that the whole matter is pushed back for 18 months or two years, which I do not think would be in Ireland's interest. Therefore, there is an increased likelihood that we may get the MFF agreed in December, which is very positive from the Irish Presidency's viewpoint.

The reason that is so important is that 85% of the EU budget that comes into Ireland is for the CAP. Of the approximately €1.9 billion that comes into Ireland each year in EU receipts, the CAP accounts for almost €1.7 billion of those. This is the key issue for us in renegotiating the CAP. In case I am quoted on those figures, they may not be exact but they are not far off the mark. Members might check them in case they are going to quote me on them.

By far the most important element of the European budget from an Irish perspective is the Common Agricultural Policy budget, pillars 1 and 2 - rural development and direct payments. As part of negotiating the EU budget, there is what is called a negotiating box around CAP decisions because it represents about 40% of the total budget. There are a lot of real, practical decisions concerning the implementation of the next round of CAP being taken by heads of state as part of the budget negotiations. For example, they will be taking decisions on the distribution levels of CAP moneys between member states. They will also be taking decisions on the percentage of direct payments that should be assigned to what are now known as greening payments. Such decisions will be taken by Heads of State, not by agriculture Ministers.

That is why the MFF is so important in terms of what the final CAP reform will look like, as well as the amount of money that will be available for Irish farmers. There is still a big concern that the overall EU budget that was proposed by the Council will be reduced quite significantly by heads of state. There was talk that it may be reduced by up to 10%, which prompts the question as to where the savings will come from. Does it come from CAP budgets, structural funds, regional development funds or the research and innovation budget? Those are the big areas. Ireland will be making a very strong case that if savings are to be targeted in the overall EU budget, one should not target CAP. From an Irish viewpoint it would be very damaging to us.

More broadly, however, the CAP is already being effectively and quite significantly reduced as a percentage of the overall EU budget. Even though what is being proposed by the Commission is that 2013 CAP payments will remain more or less intact into 2014 and on into 2020, the amount of money is not increasing annually in line with inflation. Since it is not index linked, it is effectively a cut every year. The percentage of the overall EU's MFF budget that is CAP is actually reducing year on year anyway. The idea that on top of that real reduction one would get a further reduction as part of negotiating a smaller budget, is not appropriate. Therefore we will be fighting hard to retain the CAP budget in full. If there are to be any reductions, we will fight to minimise them in terms of the CAP.

On a number of occasions, this committee has discussed the key CAP issue for Irish farmers, which is the proposal to essentially redistribute the single farm payment money between farmers - to move away from a historical basis for payment to a flat-rate, area-based payment. If one were to apply that to Ireland as a whole, one would see a significant redistribution of moneys away from what traditionally would have been the most productive sector in farming. There is a direct correlation between productivity and direct payments because of the way in which historical payments were actually given due to the number of cattle a farmer had in 2002 and 2003. By and large, they are still the most productive farmers in terms of contributing to growth in the agrifood sector. The Irish position is to support the redistribution of the single farm payment. It will take moneys from the highest earners and give it to the lowest earners.

The level of redistribution the Commission is proposing in its move to a flat-rate system, however, would result in a significant transfer of single farm payment supports away from the most productive sector, by and large, to others. This would do much damage to our sector as a whole and make it difficult for us to meet the overall growth targets we are aspiring to achieve over the next ten years. In case anyone is misunderstanding this, Ireland is still proposing redistribution but not the full level of conversions that the Commission is proposing.

If we are forced to a flat-rate model, we would have to break the country into different regions. There is not a single country in Europe that has imposed flat-rate, area-based payments without regionalisation. I do not want to have to do that unless I am forced to. It would be difficult to explain to farmers why we are putting them into different regions and applying different flat-rate payments per hectare. The reason why it works in other countries is that different regions have different types of farming as can be seen in France, Germany and Italy. For example, a farm in an arable basin in France will produce arable crops while other areas will be predominantly dairy-producing or beef-producing. These can be broken down into different regions and give different payments per hectare as appropriate. In Ireland, we have mixed farming across the country. Some of the best farms are in County Galway as well as some of the most challenged in terms of natural resources. It is likewise in Cork, Donegal and Kilkenny. Breaking Ireland up into different regions does not solve our problem in moving to an average payment per hectare.

We have put together a proposal which we think makes sense for Irish farming and other member states. This uses the formula the Commission has proposed to solve the problem of the convergence of Common Agricultural Policy moneys between countries and to move towards the same average payment. However, this cannot be done politically overnight. Production systems and costs in different parts of Europe do not justify the move either. If one were to apply the Commission's approximation redistribution model – which was an Irish construct in the first place – it would lead to the internal redistribution of CAP moneys but would not dramatically undermine the fabric of farming moving straight to flat-rate payments would do. The model means the highest earners in single farm payments would be the biggest losers, the lowest earners, the biggest gainers. As one moves to the average payment, the transfers become less. The average loss would be just under 9% and the average gain would be approximately 29%. This is a very fair way of examining this and it is gaining traction with other member states.

We now have an agreement with both Spain and Portugal that they will adopt the Irish model for applying internal convergence. Italy may well do the same while Denmark, Belgium, Luxemburg, Austria and the Netherlands have a similar problem to Ireland in that they do not want to see this dramatic redistribution of supports for farmers. We are working hard to ensure the Irish proposal gains some traction. Next week, I will go to Berlin, Hungary and Poland to explain our position and listen to what other member states are seeking in this regard.

Six months ago we were on our own on this. We now have significant member states not only supporting the theory but, in the case of Portugal and Spain, actually supporting the exact Irish proposal. I have also been to the European Parliament to get traction for this concept. If member states want to go to a reorganised, area-based payment model, let them do it. Countries like Ireland which would have a difficulty in doing so in the timeframe proposed should be allowed the flexibility to apply another way to redistribute CAP moneys and one which would be more workable.

For example, a farmer getting between €20 to €50 per hectare under the single farm payment would gain to the tune of 200%. For someone getting a small farm payment of only €20, they would gain by 600%. These are the extremes, however. A farmer on a payment of between €100 and €150 per hectare would gain to the tune of 30%. Likewise, a farmer on €500 to €600 per hectare would lose to the tune of 13.5%. A farmer on a payment of €300 to €400 would only lose to the tune of 6%. The closer a farmer is to the average area payment the less one loses. The further away from that average, the more one would gain or lose. That seems to me to be a fair way of redistribution which would result in an average loss of 8.8% to the losers and an average gain of 29% to the gainers. That case can be made for a farm on the Dingle Peninsula or a lush farm in east Cork. The alternative is we have to break the country into different regions which would be difficult politically and agriculturally.

The other political point I have made to the Commissioner is that Ireland is in a different category to other member states. We are taking over the EU Presidency in January. It will be my job to facilitate a final compromise on the CAP with which everyone can live. I have told the Commission that we have some specific issues on which we need to find a compromise before the Irish EU Presidency. This would allow our Presidency to concentrate on getting a deal done for every member state rather than having to lobby hard for an Irish position. I do not want to be sitting in the chair at a Council meeting trying to force an Irish position while we are holding the Presidency. I believe the Commissioner understands my position and this is why we are going to work hard in the autumn to find solutions that work for Ireland, at least on an understanding basis, prior to the commencement of the Irish Presidency. We want to do that in the European Parliament and in the Council. I hope the MFF will be completed by the time the Irish Presidency begins so that we can focus our efforts on completing CAP in the first quarter of 2013.

The other big issue for farmers is greening. We are making good progress on a concept called green by definition. It is proposed that 30% of countries' single farm payment allocation will apply to greening and the funds would only be paid to farmers who meet the greening criteria set out by the Commission, namely, crop diversity, protecting permanent pasture and setting aside 7% of their land for ecological areas, including forests, wetlands and marshes. Those three criteria will undoubtedly be amended before the final deal is struck but we have made the case that farmers who are already operating under environmental schemes, such as REPS or the agri-environment options scheme, should automatically qualify for greening payments without going through a series of tests on the three criteria. They should be green by definition, which means they would automatically qualify for payments. We are also lobbying to include farms where permanent pasture comprises more than 70% of the land on the list of green by definition. This would bring the vast majority of Irish farmers into the category of green by definition and they would thus automatically receive the greening payment attached to the single farm payment without going through bureaucracy and form filling. We are trying to play to Ireland's strengths. Ireland farms in a sustainable manner by and large because we have so much permanent pasture and almost everything we do is based on grass. We are unusual in that regard and this needs to be reflected in greening by definition.

Overall we are in a much better position now in respect of the CAP than was the case six months ago. We none the less face significant challenges in getting agreement on our concerns. Certain powerful countries want to force every member state into an area based regionalisation payment model simply because they already operate such a model. That is going to be a significant political challenge but we have some powerful allies which were not around several months ago. That has taken a lot of work. Over the summer months and in the early autumn I will be travelling extensively around Europe to explain the Irish position and, I hope, persuade additional countries to join our group of allies. I have before me a copy of the internal convergence policy agreement between Spain, Ireland and Portugal and I am confident that we can persuade other countries to sign up to our proposals by the end of the year.

I have outlined the broad position on CAP but if members have questions on any other aspects of it I would be happy to answer them.

Deputy Martin Ferris

I thank the Minister for his informative presentation. All of us would like this concluded by December, particularly given the responsibilities that Ireland will take over during the Presidency. I share his views on the flat rate. I am encouraged that we have recruited Spain, Portugal and, possibly, Italy as allies.

The Minister noted that those on the lower scale will receive increases whereas those on higher scales will come down towards the average. What effect will that have on the overall budget? He also indicated that the MFF budget will be reduced by 10%.

Deputy Simon Coveney

That may not happen but some countries would like it to happen. I do not think it will be reduced by that amount but certain countries are pushing hard for reductions. Ireland is obviously resisting that push and we are making the opposite case. There will probably be a compromise somewhere in the middle.

Deputy Martin Ferris

Which countries are pushing for the reduction? Spain, Portugal and Italy have serious economic problems. Is there a divergence between countries like France and Germany and Ireland, Portugal, Spain and Italy? Is it breaking down along those lines? What is the German position on CAP reform? I assume it is arguing for the flat rate.

Deputy Simon Coveney

Yes.

Deputy Martin Ferris

What other powerful countries are in that camp? I fully concur with the strategy that the Minister is adopting in regard to redistribution. Will the Heads of States be making their decisions collectively for the EU or will they be based on domestic concerns?

Is there support for Ireland's argument that REPS should automatically entitle farmers to greening payments? Is this support breaking down along the same divisions or has our argument achieved wider consensus?

Deputy Michael McNamara

Did the Minister state that he is currently opposed to regionalisation? He indicated that very few countries are not pursuing a regionalisation process.

Deputy Simon Coveney

No country has gone to flat rate area based payments, in other words, a set sum per hectare without breaking their country into different regions.

Deputy Michael McNamara

Does that include small countries like Denmark, the Netherlands and Belgium? Clearly large countries like France and Spain would be marked by considerable regional diversity.

The suggestion that the agri-environment options scheme could be made a basis for green by definition payments begs the question of what is happening to that scheme. Perhaps the Minister will clarify that in his later comments.

Deputy Pat Deering

I welcome that negotiations are proceeding successfully. It is not in our interest to have a regionalisation structure and it is important that we do not go down that road. What is the state of play on the proposals for the reference year? This issue was discussed extensively earlier in the negotiations but it appears to have disappeared off the radar.

Senator Michael Comiskey

I welcome the Minister and his officials and thank them for their briefing. We all agree that what is most important is to get the budget right. I would have been in favour of levelling payments but I agree that what the Minister seeks is very reasonable with regard to bringing up the people on the bottom and bringing into the system those who do not receive payments. The Minister has stated those in REPS will automatically qualify for greening. Are we hopeful an environmental scheme will remain in place? Setting aside 7% of the land may be a problem with regard to better land. Is it possible to reduce this percentage for better land? It may not be an issue for poorer land where there are wetlands and woodlands.

Senator Susan O’Keeffe

I seek clarification on an issue. I understand the Minister stated we could end up with two models, namely, the flat rate model to be adopted by some countries and the Irish model to be adopted by others including Spain and Portugal. Is this possible or is it something the Minister thinks might happen? Has he discussed it with the Commissioner?

Deputy Martin Heydon

I thank the Minister for his presentation. The possibility of pushing for the 7% ecological area to be considered on a national basis as opposed to an individual basis was mentioned. Has any progress been made on this? What are the chances of it happening? I am cognisant of what the Commissioner told us in January with regard to how the overall envelope was being constructed and how greening was an important part of it as there had been a reduction in real terms and greening would be a way to increase it. He warned us about pushing for a reduction of the 30%. Is the Minister confident that if we obtain a reduction in the 30% it will not mean a reduction in the overall envelope? Are they still inextricably linked?

Senator Paschal Mooney

With regard to greening, the Minister made the point that Ireland is unique in this regard. He also spoke about building alliances, which is key to a successful outcome in negotiations, particularly on the CAP. Is the Minister confident that Ireland's unique position will be recognised? If it is not and the definitions as outlined by the Minister are imposed on the Irish farming sector, it will cause enormous difficulties, including increased administration. The initiatives already taken in REPS and the agri-environment options scheme should, as the Minister stated, be sufficient. I am curious to know what is the sentiment on this as we seem to be unique and standing alone with regard to these definitions.

Deputy Simon Coveney

Many good questions have been asked. Deputy Ferris asked about Germany's position, which is very important. This will answer some of the other questions also. It is important to understand that many different systems for the allocation of direct payments already exist in various countries throughout Europe. Different ways to calculate these payments are used depending on what various Governments have done. Newer member states also have different ways of doing it. One method is a historical basis for payment which is linked to productivity levels in 2002 and 2003 when headage payments were made. People stacked payments, not quite through working the system but through their productivity. In countries such as Germany and England - but not Scotland or Northern Ireland, which use a historical basis for most payments - area-based payments are made and they have already moved to a flat-rate area-based payment. Germany made the transition from having a historical basis for payment to a flat-rate payment and its argument is that because it has done so, every other country should also be able to do so. Other countries such as Poland have had an area-based flat-rate payment from the time of joining the CAP and have never known anything else. For them, this is a non-issue. The area-based payment is a continuation of what they have. An issue arises with regard to how entitlements are calculated; they do not want to have to change their processing system for payments. Although this is a significant issue for Poland, it is a technical one. Area-based flat-rate payments are used in almost all of the newer member states and some of the older ones, such as Germany and England, to calculate what payment a farmer receives.

Personally, I believe area-based flat-rate payments do not make sense for building an agri-food industry, but this is the political decision with which we are moving forward. In my view, direct payments should be primarily aimed at supporting sustainable food production. Pillar 2 money, which is for rural development, should be supporting farmers, keeping them on the land and encouraging them to farm in an environmentally sustainable manner, although Pillar 1 must have an element of this also, particularly with greening. In my view, this is the difference between rural development funds and direct payments.

A decision has been made to move towards a flat-rate model whereby countries either bring payments to an average amount on a regional basis or in the country as a whole, or converge towards this but not get there. We will seek flexibility for countries that still have a historical basis for payment and feel that moving to a flat-rate payment in a short period would mean a dramatic redistribution within the country which would put many farmers out of business. I do not think anybody wants this.

Europe needs to continue to produce food in a way that is consistent with climate change, environmental and ecosystem obligations, but we also need to produce more food. We have a food shortage that will be a problem in Europe. It is not an issue at present as we have the buying power to purchase food we cannot supply for ourselves, but in five, ten or 15 years' time we may not have this luxury. To divert for a moment, by 2030 we know the world will need to produce 50% more food in volume terms.

Chairman

A vote has been called.

Deputy Simon Coveney

I will quickly answer the direct questions. Germany's position is to require everybody to move to a flat-rate payment. It is one reason I am going there next Monday. We do not have a problem with Germany doing it but we want it to show some flexibility to other countries. Germany wants flexibility on other issues. We would like to see payments capped for high earners. We do not want people to earn €300,000 or €400,000 in single farm payments. Germany does not want any capping. A bit of give and take is required and we hope we will get understanding from big, powerful countries such as Germany. It makes it easier to get this understanding if other large countries seek the same outcome, such as Italy, Spain and Portugal, which have similar problems to Ireland. Germany is not on its own on this and, to be fair, it has not been overly aggressive to date. However, we need to explain in detail why this is an issue for Ireland.

With regard to flat-rate payments and regionalisation, one of the reasons countries such as Denmark, Belgium, Austria, Spain and Portugal like our approach is that they do not have regionalised models and they do not want to have to implement them because of the problems we have had in Ireland. This is why we believe the Irish compromise position is good, if we are given the flexibility to give countries the option.

The reference year is still under discussion. We proposed that countries be allowed to set their own reference year rather than 2014 being imposed as the reference year. As I stated from the beginning, farmers should not make significant investment decisions on the basis of a 2014 reference year. Even after this reference year it will be possible to transfer entitlements in the same way as currently through options such as long-term leasing arrangements.

Chairman

I must suspend the meeting.

Deputy Simon Coveney

I will be as concise as I can when we return.

Sitting suspended at 11.10 a.m. and resumed at 11.35 a.m.

Chairman

We will resume.

Senator Susan O’Keeffe

There will definitely be a vote on the Order of Business in the Seanad in five minutes' time or so.

Chairman

We have moved beyond voting in the Dáil for the time being. As the Minister must leave at approximately 12.15 p.m., perhaps he will finish his response and we will then address the herring and mackerel issues.

Deputy Simon Coveney

We could e-mail members a detailed briefing note on CAP so that they might have it during the summer for when they are asked questions by farming organisations. Many briefing notes are prepared for me in advance of Council meetings and it might be useful if we shared some of that information with the committee.

I addressed Deputy Deering's point on the reference year.

I need to clarify the issue of the 7% ecological area. People are making a comparison between set-aside land and ecological areas, but they are different. When Irish farmers were required to set aside 5% or 7% of their land in return for a payment, that land was agriculturally productive and would otherwise have generated an income in some form. The ecological areas will account for 7% of farmers' holdings. On many Irish farms, that land takes the form of hedgerows, forests, wetlands, marshes, scrub land and so on. All of that land can count towards ecological areas. For many farmers, this is a non-issue. For some farmers in areas where there are not many hedgerows or forests and where production is more intensive, it may be an issue. Like other countries, Ireland has been discussing the application of a 7% ecological area calculation on the basis of regions, but doing so would be complicated. For example, the idea that County Cork should have 7% of its land in ecological areas is almost unmanageable. Farmers would need to swap land.

A great deal of discussion on how the ecological area criteria will work is necessary. The Council and European Parliament must work on the issue. However, the principle of ecological areas will remain intact. There must be some added value for a greening payment. This cannot be a bluff or pretence. The reason the Commissioner is so attached to a separate greening payment and, under pillar 1, direct payments is that, while negotiating the maintenance of the CAP budget with his Commission colleagues - they make collective decisions as a college - he made his case on the basis of a greening payment comprising part of direct payments. Many people were putting pressure on him to reduce the CAP budget by 30%. In response, he suggested a 30% reduction in direct payments and a 30% top-up payment if farmers met certain greening criteria. This time around, the major CAP reform concerns the greening payment, without which there is no radical reform. Internal redistribution is a major issue for Ireland, but not for other countries. For most countries as well as for the Commissioner, the main issue is greening. He needs to be able to show the consumers who are footing the bill for the EU's budget that Europe is doing something substantial to protect the environment and maintain biodiversity and that paying farmers to do so is for the common good. On this basis, he received the Commission's agreement to maintain the CAP budget at the proposed level. Were we to do away with greening, it would undermine his capacity to maintain the arguments for holding onto the CAP budget. This is his concern. He is not making an unreasonable political argument, although it does not address the practical issues involved in greening, such as what is appropriate. However, I understand the political argument he makes about it because I understand how the process has developed until now, and greening was a big part of that.

Senator O'Keeffe raised the flat rate versus other models. That is already there. We are saying we would maintain the flexibility that would allow different countries to apply different approaches, as long as the overall principle of convergence towards an average payment was in place. That is how we have designed our model, which we hope other countries will accept as an alternative to going for full flat rates. The other important aspect of this is that the greening payment is a major factor in moving towards flat rates as well. This is where it gets a little complex.

What is being proposed is that the 30% greening payment would be 30% of an agreed flat rate payment. In other words, the greening payment is a flat rate payment. In Ireland's case, the greening payment would be €80 per hectare on the basis of a country opting for flat rates. However, if we do not go for flat rates and if we maintain different levels of payment, the idea that one would apply greening as a flat rate payment does not work. If somebody is receiving €600 per hectare payment after the changes, the idea that they would be incentivised to do something significant to get a greening payment of €80 per hectare is nonsense. Likewise, if somebody is on €100 per hectare and they are being offered a greening payment of €80 per hectare on top of that, it is far more than 30% of their payment. There is a total mismatch then between greening policy and direct payment models. We are saying that if countries like Ireland are given the flexibility to be able to use the model we are proposing, we should be applying the greening on the basis of 30% of the actual farmer's payments. Therefore, if it is €150 per hectare, the greening payment would be 30% of that amount, and if it is €700 per hectare, it is 30% of that. The incentive remains the same for a farmer to buy into the greening model. That is a side debate that is taking place along with the other debate. I hope members understand my thoughts on that.

Senator Mooney commented about building alliances. That is most important. The Senator has been in public life for a long time and he knows how Europe works better than me. The way one gets things done is not by screaming, shouting and banging the table by oneself, but by working hard to win the arguments with other countries and bring them on board to support one's argument. That is what we are doing on the internal convergence issue. For that reason I will visit Estonia, Latvia and Lithuania next week, later in the summer I will visit Italy and I will visit Slovenia and Austria in the early autumn. I will be trying to ensure that people understand where we are coming from, that we are not just resisting any form of change but that we want change to be managed in a way that is workable for us. I believe that approach is starting to work.

With regard to greening, Ireland is not in a unique position but 85% of our agricultural land is permanent pasture, so the current greening criteria suit Ireland more than almost any other country. The idea that one would protect permanent pasture and recognise greening if a farmer has more than a certain percentage of their land in permanent pasture suits Ireland. Many Irish farms would already have much more than 7% ecological area in terms of scrub land, forest, gorse and so forth, so the criteria are potentially not as difficult to meet for Ireland as they would be for many other countries. However, that is not to say we do not have some difficulties with some of the greening criteria, because we do. We would like to see amendment and change. There was a crazy proposal that farmers who have more than four hectares of arable crops would have to have at least three crops in that land. That is absolute nonsense. Anybody familiar with arable farming knows one cannot have three crops in four hectares, unless one is in intensive horticulture or the like. The Commission now accepts that the threshold for that requirement to become active must increase to approximately ten hectares. We are seeking a threshold of 15 or 20 hectares.

There are ongoing discussions such as that and they must be based on practical farming. We all want to protect the environment and we want farming to be sustainable. We want to produce more food, but we do not wish to damage the environment as part of that. However, one must also understand how practical farming works as well. Otherwise, one will be asking farmers to do things that simply do not make sense and do not have a huge benefit to the environment. One could argue in Ireland, for example, that ploughing up some permanent pasture to put in cereals would add to diversity because we have so much permanent pasture. If one is considering providing more diversity in terms of habitats for ecosystems and wildlife, more arable farming in the parts of Ireland that currently do not have it would add to diversity rather than damage it. We are making arguments about the agricultural structures in Ireland in terms of trying to do something real about diversity and greening, and we are getting a reasonable hearing on them.

Perhaps I should proceed to the fishing. I have to leave before 12.15 p.m. because I have another appointment. It was originally for 12 p.m. but I postponed it to 12.15 p.m. so I cannot delay it any further. I will deal with mackerel and herring.

Deputy Michael McNamara

Before that, I asked if there was any movement on opening the agri-environment options scheme, AEOS, given that it would be green by definition.

Deputy Simon Coveney

I said I would make an announcement on the AEOS by the end of July, and that is still the position. We have real budget challenges with regard to opening a new AEOS. I said I would try to commit to a limited AEOS, prioritising people in special areas of conservation, SACs, and commonage areas. We would like to do something a little broader. What I do not want to do is announce a scheme and then have to pay for it by cutting disadvantaged areas scheme, DAS, payments and rural environment protection scheme, REPS, payments in the budget. There are real budgetary pressures in the Department between now and the end of the year and we have to figure out how we will navigate our way through them. In that context, I am trying to put a broader AEOS together but it is difficult and obviously I will have to get approval for it from the Department of Finance. We are working on it and we will let everybody know where they stand before August.

Chairman

Is it agreed that we proceed to the issue of herring quota and mackerel first, before returning to the harbours issue? Agreed.

Deputy Simon Coveney

The harbours issue will not be very controversial. I will ask Mr. Cecil Beamish to deal with that in some detail to show the decision-making process. Most people appear to be happy enough with the final outcome on the harbour charges. They were not happy with the original proposal, but there was a public consultation process afterwards. We took the political view, which is consistent with what the Government is trying to do elsewhere, that we would not increase charges if we could avoid it unless there was a very compelling case to change them. The only changes made in the charges related to mackerel landings, because mackerel pricing is so much higher now than it was when harbour charges were put in place in 2003. There are a few other changes that Mr. Beamish will outline but I do not believe they are controversial. If members have specific questions, we will answer them.

However, I will now deal with the mackerel and herring issues. A briefing note on this will be circulated to members. Until 2008-09, mackerel in the north-east Atlantic was a great story. The way in which it was being managed, under an agreement between the EU and Norway, meant the EU would take two thirds of the mackerel quota, Norway would take a third and the Faroe Islands got 3.7% of the quota. We were managing the stock in a sustainable way and the stock was increasing in size.

In 2008 and 2009, Iceland decided that it was going to help itself to some mackerel because mackerel was migrating into Icelandic waters. They felt entitled to it. It was not unreasonable at one level because as the mackerel stock grew, it moved farther north and west and there is evidence to suggest there is mackerel in Icelandic waters. Iceland felt it deserved a share of that but the problem was that it did not agree the share as part of the overall management of the stock between countries involved, the coastal states. Instead, it set unilateral quotas and the Faroe Islands followed suit. Last year, the Faroe Islands and Iceland helped themselves to 150,000 tonnes of mackerel, which is 23% of the recommended catch of mackerel each. Almost 50% of the mackerel stock that should be caught, as recommended by science, is being caught by two countries that, together, previously had 3.7% of the quota. It is causing carnage in the mackerel stock.

In advance of 2009, it had been handled in a responsible way. The European Union is happy to accept Iceland should have some mackerel share, as should the Faroe Islands, but the shares they are demanding is way out of line. The net effect is that if we do not do something to end the overfishing of mackerel in the north-east Atlantic, the overall stock will collapse. We are now catching 25% more than the recommended allowable catch. Scientists are saying that if this does not stop by 2014, we will face cuts of 25% in mackerel quota followed by another 25% cut in 2015. Ireland catches just under 70,000 tonnes of mackerel. It is worth €100-125 million to the Irish fishing industry each year at current prices. This is calculated in respect of the value landing on the quayside and also processing and grading. This is a very important stock for the Irish fishing industry and the Irish economy. It is being very badly damaged by overfishing and it is unmanageable while countries like the Faroe Islands and Iceland apply unilateral quotas, ignoring scientific advice. This has been going on for three years.

On behalf of Ireland, my position has been that this must stop. Otherwise, the Irish fishing industry will see a really damaging and severe cut in mackerel quotas, as happened to blue whiting in the past. That stock was overfished and then there was a dramatic cut in the quota everyone got and everyone lost. That is where we are going with mackerel unless we can figure out a way to come to some political resolution of the issue with Iceland, Norway and the Faroe Islands. There have been 13 rounds of discussions in Reykjavik, Clonakilty and other locations. The EU and Norway were trying to come to some level of agreement on increasing the allocation of quota to Iceland and the Faroe Islands from where it was traditionally. In Iceland's case this was zero and in the case of the Faroe Islands it was 3.7%. Increasing these quotas will reflect the fact that a growing stock was migrating into its waters. We have gotten nowhere on this process because they are making so much money out of it. If Ireland is making €125 million every year out of 70,000 tonnes of mackerel, it does not take a genius to calculate how much 150,000 tonnes of mackerel is worth to small islands like the Faroe Islands or to a recovering economy like Iceland. It is a very important commercial driver but they are destroying the stock in the process.

The Commission has been anxious to try to find a resolution but it is getting nowhere. Over a year ago, I said that the European Union had to show some teeth. Otherwise, we will continue as we are going, getting nowhere, and the stock will continue to be damaged. We propose that, if there was not a more responsible approach, we would introduce a new regulation to allow the Commission to impose trade sanctions on third countries behaving in a totally irresponsible way in regard to sustainably managing fish stocks. That would apply to everyone, not just Iceland and the Faroe Islands, but we would apply it to them. I am sure I am quite unpopular in Iceland and the Faroe Islands because I am seen as the Minister pushing this agenda. We have had three items on council meetings entitled AOB, any other business, where we bring up a special issue. We have had strong support from member states in the European Union to take a tough line. We have also had strong support from the Commissioner. Unless we move down the route of applying trade sanctions, the Faroe Islands will not take this seriously. The European Parliament, the Commission and Pat the Cope Gallagher, MEP, have been very involved in making this happen. Jim Higgins, MEP, has also been supportive. There is an agreement between Council and Parliament on the regulation to impose sanctions and this needs final approval at Council level, which will hopefully happen in September or October so that we can proceed to implement it. This would severely limit what can be traded from Iceland and the Faroe Islands into the European Union in respect of pelagic fish products. While it is not perfect, it is a significant step forward.

As a result of that, we are getting the sense that there may be room for discussion, particularly with Iceland, and I welcome the fact that there is a meeting taking place between the Commissioner and the Icelandic and Norwegian Ministers on 3 September in London. I hope they will make progress but not at any cost for Ireland. Ireland is the second largest quota holder of mackerel in the EU, after Britain, and it is our most important fishery in terms of value. It is a particularly important fishery for places like Killybegs. That is why I am taking as hard a line as this and we have received strong support from France, Spain, Portugal, the UK and Germany. No one is opposing the position we have taken but the reason we are doing it is that we must say that, unless there is a resolution, we must take serious action on trade sanctions in order to force a resolution. Otherwise, the stock will be damaged beyond repair. Committee members have read various commentaries on stands Ireland has taken on Iceland. My understanding is that there is at least some hope of coming to a resolution with Iceland in respect of the allocation of quota that it can accept. There is no sign of any progress with the Faroe Islands, which is disappointing. Instead, it is working with other states such as Russia to maximise the economic return from a mackerel stock being fished in an unsustainable way. It is processing at sea on factory ships because it does not have the capacity on land to deal with the volume of mackerel it is catching. I cannot say how strongly I feel about this issue. This was a great success story for the EU, for Norway and for the Faroe Islands with responsible management that was working. The stock was growing and everyone was benefiting. Now, because certain countries have decided in an opportunistic way to maximise the commercial return at the expense of the stock, the whole stock is now under threat. That must stop and we must do whatever it takes to ensure it stops. I hope we will be able to do that in a way that finds a solution that works for Iceland but that also works for us. We have given the Commissioner a clear picture of what we would regard as a figure beyond which we cannot go in terms of supporting an allocation of quota to Iceland. I am talking to the fishing industry on a regular basis on the issue.

Deputy Thomas Pringle

The Commissioner was in Dublin in October and said sanctions should in place by the end of last year. Will it happen this year? If it continues there will be no point as there will be no stock left. When will it happen? I have been told there may be EU factory ships operating in Faroese waters processing mackerel. Would that be acceptable given what is happening?

Deputy Simon Coveney

It takes time to get a trade sanction regulation accepted and put in place. It also took time to get agreement between the Commission and the Parliament on the issue, which has added to the effectiveness of the sanctions; that is what Pat the Cope Gallagher was involved in. It took time but we are now ready to bring this back to Council in September or October. We must wait for Council meeting after Council meeting before we can take the steps to make this happen. The Commissioner is anxious to progress this to ensure it will be in place for next year's mackerel fishery. Otherwise we will lose another season where the stock is being damaged.

There is no situation whereby doing nothing is the right thing here. If we do nothing, we will face a 25% cut in our mackerel quota. This is a question of damage limitation to conserve the stock and maximise the quota for the Irish fleet for mackerel. That is what we are trying to work towards.

It should also be pointed there is scientific evidence to suggest the migratory patterns of mackerel are changing and they are returning to more normal migratory routes, which do not involve a lot of mackerel going into Icelandic waters. The note outlines that the science for June 2011 showed a lot mackerel in Icelandic waters but this year practically none. That suggests as the overall size of the stock may be contracting, it might be returning to more traditional migration routes that do not involve Iceland. That might be a monthly phenomenon for June so we must wait to see the data for July and August. It might be the case that stocks are moving out of Icelandic waters, which would strengthen our hand in the negotiations.

Senator Paschal Mooney

Would the Icelandic fishing fleet not chase the fish?

Deputy Simon Coveney

Yes but Icelandic vessels cannot move in EU waters to catch the fish unless they are granted access. If there are no fish in EU waters, and there is no EU access, there will be a problem for Iceland. That is why these data strengthen our hand in negotiations in quota allocation and access to EU waters to catch the quota for Iceland.

Senator Paschal Mooney

Has the Minister considered gunboat diplomacy?

Deputy Simon Coveney

I have spoken to the Minister for Defence just in case.

Senator Paschal Mooney

It happened before in the cod war.

Deputy Simon Coveney

This is a serious issue and people's livelihoods and businesses are at risk.

Senator Paschal Mooney

It happened before in the cod war. Fishery protection vessels were sent out.

Deputy Simon Coveney

If any final deal involves access into EU waters, we must monitor that in a proactive fashion, which will involve resources. I hope we will be able to find a political and diplomatic solution that everyone can live with. Unfortunately we have not got there yet in the last three years.

Senator Paschal Mooney

Could the Minister deal with the herring issue?

Deputy Martin Ferris

There are many who admire the Icelandic attitude, although it is detrimental to us. The Icelandic economy is also improving. I am, however, more interested in the herring.

Deputy Simon Coveney

There was also a question about EU-registered vessels in Faroese waters. A number of factory vessels went into Faroese waters and they were re-flagged. They came from EU countries, particularly the Netherlands, and I am not happy about that. It will be dealt with under the trade sanctions if they are implemented. It is very unhelpful that any country in the EU would facilitate vessels from their countries going into Iceland or the Faroe Isles to contribute to this problem. Many of these vessels are privately owned and are not controlled by the Governments but that added to the problem.

Deputy Thomas Pringle

What would happen if they attempt to re-flag on re-entry to EU waters?

Deputy Simon Coveney

I do not know.

Deputy Thomas Pringle

We should look at that.

Deputy Simon Coveney

There is an element within the trade sanctions proposals that deals specifically with it. The problem is that countries like the Faroe Islands have other options, which is why there has been a lot of Russian activity in mackerel fishing and processing in Faroese waters recently. It is almost as if the Faroes have decided to write off the EU as a partner and is looking for other ways to exploit the mackerel, which is regrettable. That is why we must progress, particularly in the case of the Faroe Islands, with trade sanctions without delay because there is no chance of securing a political agreement any time soon.

Deputy Thomas Pringle

We cannot allow EU member states to facilitate the undermining of the sanctions.

Deputy Simon Coveney

I raised that issue directly with the Dutch Minister over a year ago, along with the British Minister, on the margins of a Council meeting. They are not happy about it but whether they can control it legally is another thing.

No matter what decision we made on Celtic Sea herring in particular, because the quota has increased so significantly, there will be people who will feel unhappy about it. We followed a process that was consistent and fair and made decisions on that basis.

In May 2011, I announced a review of the herring stocks. This was recommended by the industry, given the challenges faced by the key stocks. There are three herring stocks of importance to the Irish fleet: the Celtic Sea herring stock and two stocks in the north-west, known as the southern stock, found off the north west of Ireland, and the west of Scotland stock. These stocks are very important for the Irish fleet and support the fishing industry in local areas. Each year many seasonal jobs are created in the local fish processing companies when herring is being landed.

The Celtic Sea herring has suffered two devastating stock collapses in recent memory. In 2005 a management advisory committee was established to advise on the management arrangements for the Celtic Sea stock. The Celtic Sea herring management advisory committee comprising representatives of industry and processors developed with the support of the Marine Institute a rebuilding plan for the stock in 2008, which has since been implemented. This plan has led to the stock recovering from the prior severe downward trend. It is now being fished in a sustainable manner. However the success of the rebuilding plan has brought a great pressure on the fishery and while the number of vessels in the fishery was relatively constant between 2006 and 2010, last year in 2011 the number of boats fishing Celtic Sea herring doubled. This reduced the allocation for each vessel and posed a challenge to the sustainability of the fishery. The commencement of the herring review in 2011 therefore became a pivotal time for the management of the stock. As double the number of boats were going in, we had to reduce the allocation per boat. It was becoming difficult to enforce this measure which was necessary for managing the stock sustainably.

The herring stock in the north west faces a similar challenge. The stock has had significant cuts in the total allowable catch, TAC, in recent years and ICES, the International Council for the Exploration of the Sea which advises us on this issue, is recommending a zero TAC unless a rebuilding plan is put in place for the north west stock. The Irish industry with the support of the Marine Institute has now brought forward a rebuilding plan which is being considered by the EU pelagic regional advisory council. It is intended that this plan will be submitted to the European Commission for evaluation by the scientific, technical and economic committee. It is hoped that the adoption and implementation of this plan will provide a roadmap for a recovery of the stock. The west of Scotland herring stock is subject to a separate EU management plan and is now being fished sustainably.

I know members will want to ask me questions on the herring review last year. I asked the fishing industry and other interested parties to make proposals on the future management arrangements for all Irish herring fisheries, the Celtic Sea stocks, the stocks of the north west coast and the Atlanto-Scandian stock. The objective of the review was to deliver a policy which would ensure economically and biologically sustainable fisheries. I received over 20 sets of proposals. It was very clear from them there was no agreement within the industry on the issue. I asked my officials to examine the proposals received and to prepare a number of options, which as far as practicably possible took the views of stakeholders into account while delivering proper and effective management. On 22 December 2011, I published a draft policy document on the matter, which meets the objectives. I again met and consulted representatives from the industry on the draft policy. Having considered all views and having regard to the sustainability of the fisheries I came to a decision which provides for the proper and effective management, conservation and rational exploitation of the herring stocks. The policy is based on giving access to each of the fisheries - this does not apply just to the Celtic Sea fisheries but applies equally to the north west herring fishery - to those with a recent track record in that particular fishery. The track record involves vessels having landed a minimum of 5 tonnes of herring in the years 2009 or 2010 or in three of the five years during the period 2006 to 2010. In addition, there was some very limited specified circumstances where an earlier track record may be taken into account.

The track record criteria applies equally to both fisheries and to all vessels with an overall length of 10 m or greater. All vessels are treated equally, irrespective of the segment of the fleet in which they are placed. The only exception to track record relates to small vessels in the Dunmore area for the Celtic Sea fishery, where small scale local fishing is permitted in line with the rebuilding management plan for that fishery. A modest restricted quota for smaller vessels without a track record in both the Celtic Sea and in area 6A south is also permitted on the basis of the consultation process and the requests that people were making. The decision made was based on a clear, detailed and objective assessment of the fisheries in recent years. This policy is intended to ensure the long-term sustainability of the herring fisheries by limiting participation in the main fisheries to those vessels which have participated in the fishery in the five years prior to the commencement of the review, even at a low level. I am confident that these measures will assist in safeguarding the future viability of these fisheries.

We have applied the same rules off the north west as we applied in the Celtic Sea in terms of accessing that fishery. One of the reason that some people are unhappy about not being able to get into the Celtic Sea in particular is that the quota there has increased dramatically and there is more fish to catch. They want to be part of it because there is money to be made. We must apply consistent approaches to both fisheries. I hope that in the not too distant future we will be in a position to see significant increases in the quota off the north west coast as well. In time we will see people who have no track record trying to get into that fishery. They will not be able to get in. If one applies the principle of a track record, one must apply it to everybody. That is what we have tried to do. We could not allow last year to be the basis of track record because the number of boats that fished on the Celtic Sea doubled. Essentially, we would be creating an ever bigger problem for ourselves. We would not be managing the number of boats at all because the number who accessed the Celtic Sea last year was so large. We had to make difficult decisions to limit the number of boats that could participate in this fisheries so that we could fish it in a manageable and sustainable way. That involves winners and loosers. No matter what decision I took in regard to the criteria or on putting a requirement for historical catch in place in regard to track record, some people would be very unhappy with the decision. We tried to take on board the views expressed in the submissions as best we could but ultimately we had to make a decision.

My defence is that by and large the same rationale applies to the two herring fisheries we are discussing. When we see a significant recovery, as I believe we will in the north west, people in the north west will benefit from it significantly, just as we have seen a significant growth in stocks in the Celtic Sea. Those who have been involved in that fishery historically are benefiting from that now. I think that is fair. This has nothing to do with geographical areas being pitted against each other or accusations around favouritism for different areas. I want people to know that was not part of the decision making process. I represent every region and the decisions I have taken as Minister with responsibility for the marine on a series of areas are strong proof of that. I will happily try to address questions on the matter.

Senator Paschal Mooney

In the context of the track record, the recent allocation of quota in the new boarfish fishery was allocated using different criteria. The reference period in that case was from the inception of the fishery in 2006 until 2010, just before the quotas were allocated to vessels which gave the maximum number of fishing boats a chance to partake. In this case however, an excess of 95% of the boarfish catch was taken by vessels from Donegal which would have benefited from a much shorter qualifying period to the detriment of boat owners in the south. As it worked out vessels that had very little or no track record and participation in the boarfish were awarded with generous quotas. Why implement different selective criteria?

The decision that is being taken in regard to this fishery will have serious impacts on employment in the area and I know that Deputy Thomas Pringle, who lives there will add his comments to this. The 350 workers currently employed in fish processing facilities in Killybegs and Kincasslagh will lose out on approximately six to eight weeks work as a result of no herring processing. Three boats in Rossaveal are particularly affected by the proposals. Eighteen of the 22 pelagic fishing boats in Donegal are now excluded from the largest herring pelagic fishery. That is unheard of anywhere else. The argument that has been made is that the replenishment of stocks does not make sense. The overall national quota will be fished in any event, albeit almost exclusively by vessels in the south of the country. I know the Minister has addressed the perception that exists in the north west.

Deputy Simon Coveney

Can I address those issues?

Senator Paschal Mooney

I have tried to be as focused and as concise as possible in asking my questions.

Chairman

I have a feeling the Minister can address these issues more easily and efficiently if he responds after Deputies Ferris and Pringle have contributed.

Deputy Martin Ferris

The area of the Celtic Sea we are talking about, from the south east right over to the south west and including part of the west, has had a tradition of mixed fisheries for many years. Those who are fishing in the area feel they are being discriminated against. They believe this will be ring-fenced to the benefit of a limited number of vessels, just as the mackerel quota was ring-fenced. When the Minister spoke about the track record in this regard, he took the years between 2006 and 2010 as the reference period. Does that mean that many of those who fished last year, when the number of boats doubled, will not be part of this fishery because they do not have the necessary track record? I would argue strongly that we should not focus on the quantity of fish that is landed. Instead, we should bear in mind that the more people who are involved in the fishing industry, the more beneficial the economic and social spin-off is to the coastal communities they come from. The Minister said he will consider certain cases involving those who had a track record prior to 2006. Many people who were involved in the herring industry 15, 20 or 25 years ago have concentrated on sectors other than the herring sector in more recent times, perhaps for economic reasons. Is any mechanism, such as an examination process, open to them to allow them to get back into the industry?

Deputy Thomas Pringle

When the management plan was put in place in 2006, people were not aware that their track records would determine whether they would get access at a future date. It seems there are differences in how track records are being applied across the Department. Senator Mooney mentioned the track record with regard to boarfish and how access was provided in that case. Some boats that only had one opportunity to catch boarfish on their way to dock in Denmark got access on that basis. Track records were also used when the polyvalent mackerel allocations were made a couple of years ago. In each case, the track record was used in a different way. People deserve to know in advance what the methodology for assessing track records will be. That is the least people could expect. The lack of advance notice is causing this difficulty at the moment. Long before the 1960s or 1970s, boats from Killybegs fished for herring in the Celtic Sea. The industry in the north west has a long-established tradition and track record of fishing in the Celtic Sea. This measure will have a severe impact on employment in the north west. One of the issues given for restricting the number of boats is the need for improvements in quality. Given that refrigerated sea water boats are of a better quality, that does not really stand up.

I would like the Minister to address the 5% ring-fencing for vessels under 20 metres, which will have a substantial impact on small fishermen in County Donegal. They have already been affected by the closure of area 6A and they will now be restricted in the amount of herring they can catch. Some fishermen will see big reductions in their quota and huge losses of income as a result. Did the Department conduct an assessment of the impact these changes will have on vessels under 20 metres? It was originally proposed that this measure would relate to vessels under 15 metres, but that has been increased to 20 metres. I am aware of people with vessels under 10 metres who were sometimes unable to target herring for various reasons, such as the weather. They depended significantly on the herring fishery at other times. Now that they have lost area 6A and the right to fish for herring, they are in a very difficult situation. I would like to know whether the Department has thought about the impact of this issue on such people, or engaged in any talks on the matter. It is important that people are informed about how these decisions have been arrived at.

Deputy Simon Coveney

I do not think we should be trying to pit regions against each other. The decision that has been taken with regard to the Celtic Sea is not an anti-north-west decision. Similarly, the decision that has been taken with regard to the north west herring stock is not an anti-south west decision. If we want to have a sustainable herring fishery, we have to put some kind of management system in place to limit the number of boats that are targeting herring. Boats have to be allowed to catch a certain amount of fish to be viable. We cannot allow everybody to target a stock. We know what happens when that is allowed. It has happened in the Celtic Sea previously because of a lack of management. The stock has collapsed twice in recent memory because we did not limit the number of boats and we could not police how much people were catching.

This decision was reached on foot of the work of the Celtic Sea herring management committee, which is industry-led. It recommended what we should do. People need to know that the recommendations came from fishermen, rather than from civil servants. We are trying to ensure the Celtic Sea stock continues to grow and to be managed in a sustainable way so that we get year-on-year quota increases rather than reductions. We need to do the same in the case of the north-west herring stock, which has traditionally had a much bigger TAC than the Celtic Sea herring stock. There was a 15,000-tonne quota in the north west ten years ago, whereas the quota for Celtic Sea herring was just 6,000 tonnes. It has traditionally been a bigger fishery. We need to get back to that. The 2011 track record of the boats that fished last year was not considered as part of the track record calculation because the review happened in 2011. Those who knew the review was under way went to catch fish because they anticipated that there might be a track record requirement. That was part of the driver for catching herring. When one is undertaking a review, it is standard practice not to include the year in which the review is taking place as part of the track record calculation. There may have been some exceptions to that in the past. If that is the case, I will be happy to hear about them. I have given my understanding of the standard practice in this respect.

It is important to state clearly that boarfish is a new stock and therefore falls into an entirely different category. Last year was the first time a quota was ever allocated for boarfish. There was no quota for boarfish before then because it was essentially seen as a trash fish. People threw it over the side or brought it to fishmeal factories. It was a valueless fish. It is bony, spiky and difficult to manage. To be fair to the industry, led by a number of boats in Killybegs and a couple of boats in Castletownbere, the boarfish fishery it has developed is very exciting in terms of where it is going. It was suggested that a track record should have been applied to this brand new stock when it was having quota allocated to it for the first time. For the reasons outlined by Deputy Ferris, it would have been unreasonable to limit the fishery to the boats that developed the fishery. When a new and exciting stock is being developed, we want to ensure that boats have the option of experimenting with it. We do not want to prevent them from seeing whether they can make a living from catching boarfish. That is why the pilot arrangement that was introduced in the case of boarfish was much looser. We have yet to draw up a longer-term management plan for boarfish.

Celtic Sea herring, like north-western herring, has been fished for decades. We are trying to ensure we have a management plan that sustains the stock into the future and maximises the return for fishing communities in terms of landings, processing and so on. I do not accept the rationale of those who argue that 200 or 300 jobs will be lost in Killybegs as a result of the decision on Celtic Sea herring. Any boat that has been catching herring in 2009 and 2010 or for three years between 2006 and 2010 may continue to catch herring in the Celtic Sea. It is true, however, that the options for catching herring off the north west coast are much more limited. The reason people want access to the Celtic Sea is that the stock off the north west has been so badly damaged.

Senator Paschal Mooney

I understand 18 of the 22 boats in the Donegal pelagic fleet will be excluded from the Celtic Sea.

Deputy Simon Coveney

It is not the case that they have been excluded; they are not included because they do not have a track record. All vessels in the fleet may catch fish off the north-west coast where we need to rebuild the stock. We cannot have a situation where a stock is damaged or depleted and everybody moves to a new location until the stock in the new location has been damaged or depleted. Such an approach would be madness from the perspective of stock management. We must have rules in place and the same rules apply to the Celtic Sea as apply to the north-west. I am aware that some people are not happy with the position as it has commercial implications and consequences for them. I would love to increase the allocation of quotas for the north west in order that everyone could win from herring. However, if one limits the numbers, one must accept there will be winners and losers. That is the position.

Chairman

How long did it take to rebuild stocks under previous rebuilding programmes?

Deputy Simon Coveney

Under the rebuilding programme that was started in 2008, a dramatic increase in stock did not take place for two or three years. Celtic Sea herring has taken everybody by surprise. This has been a positive development and there is no reason it cannot be repeated off the north west coast. Following the success of the programme for Celtic Sea herring, the Taoiseach has asked me to introduce similar management structures for north west herring. We will consult the industry to ensure we get the structure right. The solution is to rebuild the north west stocks of herring as opposed to giving everybody access to the Celtic Sea as to so would be unsustainable.

I was aware that people would be unhappy irrespective of what decision I made and that some of them would probably take the Department to court. I have been focused on the process of decision making to ensure it is consistent and fair, everyone is treated the same and it is based on a track record that is reasonable. It is not unreasonable to exclude last year's track record because most people knew there was likely to be a track record element in the future management plan and decided on that basis to catch fish to obtain a track record in 2011. Many of them did not have a track record for the previous five years, however. While I will be criticised for the decision to exclude the year of the review, there was no element of regional bias. I will strongly defend my position, even though I am sure some people will not accept it. Regardless of what decision I took, some people would be unhappy. Our focus is on rebuilding stocks in the north west in order that we can obtain a boost or bonus similar to that we are getting from the Celtic Sea. This will be done by increasing total allowable catches in the north west as soon as possible.

On Atlanto-Scandian herring, which is in the North Sea, it is worth noting that 85% of this stock is allocated for the RSW fleet, which operates almost entirely out of Killybegs. This amounts to almost 5,000 tonnes of quota. The idea that I am making decisions on a regional basis to the advantage of certain ports or fisheries does not stand up when one considers the decisions my Department has taken. I accept, however, that people are frustrated that they cannot access a fishery in the Celtic Sea this year.

Deputy Thomas Pringle

Clarity is required on how the track record issue will be addressed in future because this caused many of the problems. Once we have clarity, management plans can be put in place well in advance because people will know that the track record issue will be treated in a particular manner and applied consistently across the board.

Deputy Simon Coveney

Yes. On one other question, my understanding is that boats under 10 m are not restricted in respect of the north-west herring fishery.

Deputy Thomas Pringle

They have only 5% of the quota.

Deputy Simon Coveney

Yes, but of what do they have 5%? We are under considerable pressure from the European Commission to have a zero total allowable catch in the north west herring fishery. It is for this reason that we must implement a management plan that is acceptable before December. We need to make a case for having any quota in this fishery in the period in which we are rebuilding the stock. In terms of the volumes caught by many of the smaller boats, the 5% limit should not be highly restrictive. Smaller boats fishing out of the Dunmore box in the Celtic Sea also have a relatively small allocation in percentage terms. However, it meets their demands because they catch much smaller volumes than the larger boats.

Deputy Thomas Pringle

Does the Department have figures on that?

Deputy Simon Coveney

Yes; I can provide the Deputy with figures and information on the consultations and submissions that took place as part of the decision-making process.

Deputy Martin Ferris

I have a question on bass and by-catches. I was contacted by elements in the fishing industry who informed me that vessels from other European Union countries which have bass as a by-catch may land and sell it here. It is illegal for an Irish vessel to land bass by-catch.

Deputy Simon Coveney

Bass will become a major point of debate between now and December because the Commission is considering introducing quotas or total allowable catches for bass at a European level. Ireland has banned all commercial bass fishing for the past two decades.

Deputy Martin Ferris

Is the ban applicable only to Irish boats?

Deputy Simon Coveney

Yes. Boats may not catch bass inside the six-mile limit in Irish waters. Outside the limit, it is frustrating for members of the Irish fleet to see French and English boats catching bass when they are required to dump dead bass over the side of their vessels whereas bass is caught as a by-catch when they are in other fisheries. There is not an easy resolution to this. We stopped commercial fishing for bass for genuine conservation reasons. As a result-----

Deputy Martin Ferris

It does not make sense that French and English vessels can land bass in Ireland as a by-catch when Irish boats may not catch or land bass. This is a discriminatory approach.

Deputy Simon Coveney

The problem is that legally I can only manage Irish boats and may not require the French fleet to ban commercial bass fishing, although I would like to do so. This is an awkward political issue. If we are to move towards a total allowable catch for bass and people are catching bass under a TAC, why should Irish boats not have access to that TAC? The problem, however, is that we will not have any track record on bass because we have banned commercial bass fishing for the past two decades. I face the awkward political challenge of persuading the Commission to accept that Ireland should not be punished for acting responsibly for the past two decades. I raised this issue with the Commissioner at the Council meeting this week and publicly in front of other colleagues. We need to work out a solution by December. The Deputy has raised one issue related to bass but another larger issue is coming down the tracks. I am aware that people in the Irish industry are very frustrated at the suggestion that a TAC may be introduced for bass and they will not have access to it because we do not have a track record as we ended commercial bass fishing two decades ago. Such a scenario would be highly unfair. The Commissioner nodded her head when I outlined the case and clearly understands the position. Securing the agreement of other member states will be a much bigger challenge for us.

Deputy Martin Ferris

We could end up without a bass quota.

Deputy Simon Coveney

Yes. When a quota system is introduced to manage bass stocks we could end up without bass quota because we have taken a responsible position for the past two decades. That would be a travesty because it runs contrary to everything the Common Fisheries Policy is about. However, there is a long way to go in that debate as it is only beginning.

Senator Paschal Mooney

Deputy Ó Cuív had to leave the meeting earlier, but he asked for the committee to raise the issue of ferry charges in Rossaveal. Has that been dealt with?

Chairman

We are going to deal with that next with the officials.

Senator Paschal Mooney

Thank you.

Chairman

I thank the Minister for attending and wish him well in the continuing negotiations.

Senator Paschal Mooney

Do we have a copy of the most recent document outlining the allocation of herring quota?

Deputy Simon Coveney

We can get a copy of that for everybody here.

Chairman

We thank the Minister and wish him well in both CAP and CFP negotiations. One might think the CAP is complicated, but the CFP is probably more complicated.

Deputy Simon Coveney

Before I go, members should let us know if they would like a detailed briefing on either the CAP or CFP and we can arrange that with officials. We have excellent officials in both of these areas and they would be more than happy to provide detailed briefings on the different negotiations taking place. If members wanted, they could do that in September, perhaps in a less formal setting.

Chairman

We could arrange to get the AV room for that.

Deputy Simon Coveney

We could arrange a presentation on both the CAP and the CFP so that everybody is aware of the key issues.

Chairman

Is that agreed? Agreed.