Thar ceann Sheanad Éireann, is mian liom fáilte chroíúil a chur roimh an Uasal Phil Hogan, An Coimisinéir Eorpach um Talmhaíocht agus Forbairt Tuaithe. Thug an Seanad cuireadh don gCoimisinéir Hogan an Teach aitheasc a thabhairt mar dhuine oirirc. On behalf of Seanad Éireann I warmly welcome Mr. Phil Hogan, European Commissioner for Agriculture and Rural Development. Commissioner Hogan has been invited by the Seanad to address the House as a distinguished person. This is his second address to the House since his appointment as Commissioner in 2014, hence signifying the importance the Seanad places on agriculture and rural development issues at home and abroad. Before his appointment as EU Commissioner, Mr. Hogan had a long and distinguished career in Irish politics. Who better therefore to understand the challenges and opportunities for farmers and farming families, than someone who has grown up on a farm and lived his life representing a rural constituency in Ireland.
Address to Seanad Éireann by Commissioner Phil Hogan
I myself and numerous other Senators here today also live in rural constituencies and experience first hand the challenges faced by communities all over the country on a daily basis. We are all aware of the major role agriculture plays in creating employment, generating economic activity and acting as a custodian of the countryside in Ireland. The extreme weather conditions over the past year have placed an enormous stress and strain on farmers, which in turn in some cases can lead to mental stress and anxiety. This had brought an unwelcome hardship to farming families and clearly demonstrates the unique vulnerability and exposure of agriculture to fluctuations in the weather.
I welcome that the Commissioner put the reform of the Common Agricultural Policy, CAP, at the top of his agenda since coming into office. It is safe to say that most of us from rural Ireland and many more are watching the ongoing debate that is currently taking place on the next Common Agricultural Policy. Commissioner Hogan will be aware that the Joint Committee on Agriculture, Food and the Marine which he will be meeting this afternoon, is playing an active role in the examination and conversation around CAP and the impact it will have on various sectors in Ireland.
I am aware that he had an opportunity to meet members of national parliaments, including a delegation from the Oireachtas joint committee, on the issue of CAP at a meeting organised by the European Parliament's agriculture committee and national parliaments on Tuesday of this week. The ongoing engagement of the European Commission and the European Parliament with member states is to be welcomed, as is the Commissioner's visit to us here today.
We must do all we can to protect our farming communities. I have no doubt that Commissioner Hogan's practical experiences and life lessons will stand him well in dealing with the challenges faced by farmers in Ireland and in all corners of the EU. I trust that he will have the foresight and commitment to develop and make agriculture into a sustainable industry, given that it is such a vital component in keeping our rural communities alive.
In welcoming the Commissioner today, I am aware that he is representing Ireland at probably the most significant time in the 60-year history of the EU. The challenges presented by the UK's decision to leave the EU will be felt in all 27 remaining states for many years to come. It goes without saying that the challenges for Ireland are immense. However, I am heartened by the reaction of the 27 remaining member states and their sense of loyalty to the European project. Although Brexit is difficult for us, I know we will find the strength and determination to shape our own destiny and create a stronger Europe through a united and more determined Union. I think we are aware of the role Commissioner Hogan has played in explaining Ireland's unique situation and keeping Ireland's interests to the fore in the minds of his fellow Commissioners and the wider European family. We thank him for that.
I am aware that he has been to the fore in various trade negotiations and agreements on behalf of the EU and our global partners. For example, he was at the heart of the negotiations in Japan at the successful conclusion of the final discussions on the EU-Japan economic partnership agreement, which puts in place the largest bilateral trade agreement ever negotiated by the EU. I understand he was central in reaching an agreement in principle on trade and investment between the EU and Mexico, after many months of negotiations. We were pleased to hear the Minister, Deputy Creed, announce last week that the Chinese beef market is to be opened to exports from Ireland. The opening of this key market presents an excellent opportunity for the Irish beef sector from farmers to processors. The decision of the Chinese authorities represents a significant endorsement of Ireland's superior standards of food safety. Such agreements have a serious economic impact throughout EU member states. For Ireland, they present many opportunities for additional trading opportunities for our farmers, entrepreneurs, SMEs and larger industries. Opening and developing new markets is a key part of our response to the uncertainties arising from Brexit.
We wish Commissioner Hogan continued success as he endeavours to find and negotiate new markets in the critical agriculture sector and other sectors for the benefit of us all. A Choimisinéir, is pléisiúr é dom cuireadh a thabhairt duit anois Seanad Éireann a aitheasc. Commissioner, it is now my pleasure to invite you to address Seanad Éireann.
Mr. Phil Hogan
Gabhaim buíochas leat, a Chathaoirligh, as ucht cuireadh a thabhairt dom bheith anseo i Seanad Éireann inniu. I recall from my time as a Senator between 1987 and 1989 that certain improvements had to be carried out to the Seanad Chamber at that time. I had the opportunity to sit in the official Seanad Chamber in Leinster House for the first time in May 1989. The then Taoiseach, Charles J. Haughey, came into the House to introduce the An Blascaod Mór National Historic Park Bill, 1989 and then went to the country. I hope I will not have the same effect on things. God forbid that the Seanad would actually be able to-----
The Commissioner should stop speaking now if that is going to be the case.
Mr. Phil Hogan
It is my honour to address this House for a second time as EU Commissioner. I was due to be here in February, but circumstances intervened. The whole country had to batten down the hatches and wait for the snowstorm to pass before getting on with things when the weather improved. It is clear, if Senators will forgive my use of weather metaphors, that Ireland and the EU have had to weather some heavy storms in the last decade. First, we were battered by the global economic crisis, which almost brought Ireland to its knees and forced the EU to drastically recalibrate its priorities. Thankfully, that particular storm is now in the rear-view mirror and today we are meeting in better times.
The European economy has picked up, with Ireland leading the charge. The EU's economic growth hit 2.7% in the final quarter of last year and should hit 2.8% this year. Investment is picking up. The employment rate is above 72%, which is higher than ever. Unemployment has fallen from 10.3% three years ago to 7.3% now. In the four-year lifetime of this Commission, the economy has created 9 million extra vacancies, which is a major achievement. Last year, the European economy grew faster than the US economy for the first time in many years. Heavy storms force us to check the strength of our foundations and that is what the EU is doing at the moment. The EU Commission, under Jean-Claude Juncker, can and should claim a fair chunk of the credit for the recovery I have mentioned. It was Mr. Juncker who proposed that large-scale investment programmes should be financed by the European Investment Bank to add EU value to what member states were doing to facilitate investment opportunities. The co-ordination of EU countries' economic policies has been improved. The social pillar promotes fair working conditions, equal opportunities and greater social protection for EU workers. These actions are helping to storm-proof the European economy. Deeper reforms will help member states to withstand future crises. Economically speaking, the wind is in our sails.
Another storm appeared on the horizon in June 2016. We are still waiting to see the final cost of its impact, particularly here in Ireland. Brexit was a hurricane force storm. It caused an existential panic at the heart of the EU. There was a real fear of a domino effect that would tear the EU apart. By late 2016, Eurosceptic forces were on the rise across Europe. They polled well in a number of key elections and were supported across the Atlantic Ocean by the new US President, Donald Trump. The proportionate and quick response of the EU was to check the foundations and see what defences needed to be strengthened. Mr. Juncker has initiated a bottom-up process to ascertain what type of Europe our citizens will want in the future. I am glad that Ireland and this House are playing their part in these matters. The citizens' dialogue on the future of Europe has a programme of discussions and consultations that will continue throughout the country up to Europe Day on 9 May next. The Government and the Joint Committee on European Affairs are making their own contributions to the debate on the future of Europe. This is to be warmly welcomed. I commend the Members of this House on their contributions.
The EU institutions have been shaken from their slumber. It is noticeable that there is a new energy and a new desire to get things done. In a world of rising nationalism and retrenchment, the EU is occupying the space that has been vacated by others to lead from the front across multiple policy areas. The EU is now the unquestioned global leader in promoting open and fair trade that is based on rules. As the Cathaoirleach mentioned, in the past two years we have signed important new deals with Canada, Japan and Singapore. Earlier this week, I was delighted to announce an agreement with Mexico. Many of these deals are immensely positive for our agrifood producers and our pharmaceuticals and financial services sectors. This is very good news for Ireland. Size matters in trade. As the world's leading trading bloc, the EU is in a position of strength to build mutually beneficial agreements with our global partners. We are driving the global agenda on climate and sustainability, which remains the single greatest challenge of our time. This country urgently needs to step up its contribution to meeting this challenge. We are trying to relight the flame of Europe's enlightenment values by making truth and reason relevant again in a world of mistruths and fake news.
Again, Brexit is important in this context. EU membership was a successful policy in the UK and was accepted as such by the majority of politicians and commentators. That did not stop a majority of people voting to scrap it. That is strange because one thing the Brexit story has shown is that the UK does not - by a long shot - have an alternative policy to EU membership. Even Brexiteers are happy to keep one foot in the EU, for example by continuing to participate in security and transport agreements and certain EU agencies. The fact remains that people in the UK voted to leave. As politicians, we might think successful policies always commend themselves, but that is not always the case. Successful policies need to be defended, articulated and communicated. Brexit has taught us all a sharp lesson in this regard. We need to understand this and incorporate it into our political lives as part of our stocktaking. We cannot take it for granted that people will vote for the EU, or like the EU, just because it happens to work.
As I mentioned earlier, this has been a wake-up call for the European institutions. We have to look at how we can do things better in this regard. That is what we are discussing with member states and, through them, public representatives and people. Perhaps we can go a stage further by asking how everyone failed to spot that a disconnect was arising between citizens and their representatives. This disconnect dominates so much of our politics today.
How did we allow our public discourse to be dominated by fake news and half-truths? How can we begin to remedy things and stop it happening here? Here again, Brexit should be a lesson, because another thing the Brexit story has shown us is a brand of politics in which concern for people's real well-being has gone out the window, the soundbite has become more important than the truth and people can groom a majority to act against its own welfare. In short, we now have a brand of politics and commentary that, all too frequently, misleads rather than leads.
It is remarkable that a successful UK economy is determined to be divergent rather than convergent with its neighbouring countries in Europe. If we look a little more widely, we see it is not only Brexit. Our political arguments are becoming coarsened and are having knock-on effects on our behaviour. One sign is the trigger-finger readiness of so many people to play the immigration card, even the race card. Much of this is the result of fake news and the way in which what we used to call tall stories and gossip no longer goes from mouth to mouth but from one set of fingers to a million sets of eyes, with a tap on the keyboard.
Brexit shows us how vulnerable we are in that regard. That is why the Commission is alerting member states to the dangers and advising them to set up an infrastructure that can counter what is happening. The respected Irish Independent editor-in-chief, Mr. Rea, is making a sterling contribution to this work, having been appointed to the European Commission's high level expert group examining the issue of fake news. Next year's elections to the European Parliament gives this added significance and urgency. We must be on our guard.
My final thought on this issue is to underline the difference between bad publicity, contrary opinion and fake news. As politicians we all know about bad publicity and contrary opinion. It comes with the turf and we deal with it, but we do it in the world of truth. We have been slow to recognise that fake news is something else. It is not bad publicity, it is not contrary opinion, it is not in the world of truth. It is a fiction - a harmful fantasy. It is urgent that we find the way to reveal it for what it is, namely, political mischief and a wrecking ball. These are the positive actions taken so far by the European Union to withstand the Brexit storm, but of course that storm has not yet passed by a long shot.
If we look ahead for the moment to the post-Brexit Union, one thing is already becoming evident, namely, the changing relationships between member states. The disappearance of a member state, and a large one at that, makes this inevitable. Ireland will be separated from a friend and partner in EU discussions. We joined what was then the Common Market together - indeed it was unthinkable that one of us should join without the other - and have worked together on many of the major issues. Now Ireland has to reconsider its role, its objectives and its relationships. Sometimes, for example, starting next year, we shall be speaking for the whole island. The development of new relationships has already begun. For example, the Irish Government is in the forefront of efforts to co-ordinate the views and voices of like-minded members. On the trade question, Ireland is alongside Nordic and Baltic states in the informal Hanseatic League, mark II. On digital matters we have other allies and friends.
However, there is another, strategic level for us to consider. When the European Union talks security, eyes normally turn east or south. For us, bordering the Atlantic Ocean security questions may sometimes seem remote but is this a moment for us to review our thinking on these wider, strategic questions? Despite our secure position in the west, we have come under a security threat - from Brexit. It is a threat that An Taoiseach and the Government are resisting pressing until a soft border between us and the North is guaranteed. They have mobilised themselves to carry the case to Brussels and have done so with great clarity. The Union, with its other 26 members, stands with us shoulder to shoulder, never wavering. We have felt the strength and benefit of EU solidarity over the past couple of years. Imagine what it means to our fellow members in the Baltic region, for example, who border Russia and have large Russian-speaking populations. Imagine what it means to those member countries that are in the front line in dealing with immigration from the Middle East and the Mediterranean.
As part of the European Union we all share the Union's destiny. We, who have felt, and are still feeling, the benefits of its solidarity should be ready to ask how we may better contribute to the solidarity offered to others. We value our neutral status but we should not stand aloof because of it. We should also want to play our full part in the European Union's security. Brexit can only be declared over when the future relationship between the European Union and the United Kingdom is known. That is perhaps most urgent in relation to the Irish Border. The UK has twice said it wants a soft border and Prime Minister May said in her Mansion House speech that the UK was not about to walk away and leave it to Ireland or the European Union itself to deal with the question. That is positive, but we are still stuck fast in the UK's self-imposed contradiction between its reassurance on a soft border and its hardline demands, its red lines, which have led the European Union to offer a free trade agreement. The UK wants to keep its red lines. It understands that a free trade agreement means a hard border, and is trying to escape by inventing a new type of border. It says a soft border can be assured - even in a free trade agreement - through new customs practices and modern technology, which I call a cyberborder. The European Union has looked at the UK's ideas and it is not convinced that it can give us the border security we need, within the Brexit timescale, and has sent the United Kingdom back to the drawing board. Meanwhile, it insists on the back-stop of a customs union for the whole island of Ireland.
An Taoiseach and the Government, supported by all parties in this House, and by the European Union, have made it clear that they are not fudgers. The UK has to face up to the fact that decision time is here. The European Union must be satisfied that the UK's invention will work or it is the back-stop that will be implemented. The deadline is set for June. If there is no decision, there will be no withdrawal treaty. If there is no withdrawal treaty, there is no transition. The Government has the border issue under close surveillance. Let us consider for a moment the final piece of Brexit business, namely, the future arrangement between the United Kingdom and the European Union. Here the target is to agree the broad lines by the autumn and fill in the detail ready for the agreement to be in force by January 2021.
In her Mansion House speech in March, Prime Minister May revealed that the United Kingdom wants to retain many of the advantages it gains from EU membership. She has given us a long list of what the UK wishes to keep. It is a very long list. On the other hand, she maintains the red lines to which I referred. Future discussions will show us how badly the UK wants what the Prime Minister has asked for, and by future discussions, I do not just mean between Brussels and London, I mean also the London-London discussions. Indeed, I would say that the London-London discussions are more critical. Now that its battle is won for the Brexiteers and the UK is within a year of leaving the EU and becoming a third country instead of a member, can London -London climb down from the barricades and evaluate the future arrangements it wishes to have with the European Union to find a solution which will be in the best interests of the people of the United Kingdom as workers and as consumers? In my view, a landing zone involving some form of customs arrangement and a softening of the red lines by the United Kingdom must be in the best interest of the people of the United Kingdom and the people of this country and of the European Union.
Do the Brexiteers want to carry on the civil war until there is not a building left standing on the other side? Is that the sort of victory they seek? If so, they do not only endanger the UK's economy but they also endanger its society. Recent statements by people such as Mr. Jacob Rees-Mogg on Irish beef are a good example of a comment that is both unhelpful and irresponsible, but of course that is his stock in trade, if Members will pardon the pun. His comments highlight that the rift between the Brexiteers and the Remainers risks going on and on. Instead, both sides should compare and honestly weigh the costs and benefits of a free trade agreement versus a customs union. This is a moment for balanced judgment, not costly immoderate ideology. Now that Brexit is irreversible, such a review would be the statesmanlike option.
The importance of this for Ireland cannot be overstated. The more the red lines are softened, the less disturbance there will be to our UK trade and the easier it will be to achieve a soft border without relying on technical and bureaucratic wizardry. Ireland certainly has its own preference for the outcome of the talks between London and London, but it is not in either Ireland's or the EU's power to realise that. Both are on the sidelines when it comes to the discussion in the UK. The UK has asked, in effect, for a free trade agreement. It wants all sorts of additions, but its basic demand is a free trade agreement and that is what the European Union is forced to offer. However, wrapped up into the argument between a free trade agreement and a customs union is the ambition of global Britain. In her Mansion House speech, Prime Minister May listed the UK's freedom to negotiate its own trade deals as an advantage of Brexit, but for this freedom to improve the lives of the people of the United Kingdom, the UK would need to offset its losses in trade with the EU, which are certain to take place as businesses cut British companies out of their supply chains, and gain additional benefits. That is the ambition of global Britain. I do not think it is realistic. The freedom to seek and negotiate trade deals seems intimately connected to sovereignty but the UK needs to look at this issue with cold-eyed realism. Its overall objective is to achieve a better future for UK citizens. That cannot be achieved on a wing and a prayer.
What are the factors that make me so certain that global Britain is not the answer? First, outside the European Union, the UK will see its standing and importance reduced. Global Britain will feel that pain. As I mentioned earlier, size matters in trade.
Second, a trade deal with the US will be very difficult to negotiate, despite the sometimes effusive language. "America First" will be ringing in the ears of the US negotiators. The US certainly will seek market access in areas that will bring the UK into direct conflict with European standards, for example on genetically-modified crops, hormone beef, chlorine-washed chicken, etc.
Third, the UK also wants to turn again to the Commonwealth. Yes, it has a common language and similar legal systems but it is not a cohesive bloc. There is no single negotiating partner, nor is it geographically compact. Commonwealth countries also have their own demands. India is determined to keep its high tariffs on Scotch whisky, for example, and would probably want the UK to ease restrictions on work visas. That would not be interpreted as the UK taking back control and would not be acceptable to the Brexiteers.
Global Britain is stepping out of the huge network of global trade deals that the EU has negotiated and into a difficult world. It is legitimate, therefore, to doubt whether it can achieve more trade for the UK than at present, at least on any realistic timescale. It takes about seven years to do any meaningful trade deal, as it took with Canada. On optimistic assumptions, even British civil servants say it cannot achieve more trade. They forecast that Brexit will cause a 2.6% reduction in gross domestic product, GDP. If, however, some of their assumptions on trade are made more realistic, the potential losses become greater. Ireland could feel the winds of this as well. Doubts about betting the house on global Britain only increase when we count the loss of benefits on the Prime Minister’s negotiating list – benefits that do not accompany a free trade agreement. The facts say “reconsider”.
Senators, the Brexit storm has yet to pass, although we have, in the past couple of months, made good progress towards safeguarding our future. The Mansion House speech by Prime Minister May has been a gamechanger in respect of more realistically and maturely identifying the difficulties and issues that must be resolved. However, the UK will not have it all its own way. The EU is standing with Ireland as one of its members. We would not expect it to be any other way except to stand with a country that continues in the EU and wishes to continue in future. The Union has defended Ireland and, in doing so, has demonstrated its value. We are not out of the woods but we can draw confidence from everything that has happened in recent times. I believe firmly we have a European Union that is proud of us as members and of which we can be proud. I want us to build further on this foundation. Go raibh míle maith agaibh.
I thank the Commissioner. I know he has a very busy schedule today. Spokespersons from each group have a maximum of five minutes. I will be strict on time. There will be three minutes for other contributions and then I will call on the Leader of the Seanad to have a three minute contribution not later than 12.27 p.m. The Commissioner will have three minutes to respond. I call Senator Paul Daly.
I welcome the Commissioner to the House and compliment him on all the great work he has done to date in what is a demanding brief. It is particularly demanding at the moment with the review of CAP, Brexit and the foreign trade deals all being so interlinked and influential on each other. We could quote an old slogan of ours. The Commissioner has a lot done but there is a hell of a lot more to do. It is only when all three fall into place that we will get a clearer picture of each one individually and the future for the agriculture sector. Indeed, the entire rural community of Ireland is dependent on all three.
On the CAP review, I know the Commissioner has travelled the highways and byways of Europe to get agreement among 27 diverse nations. I was at the conference in Brussels on Tuesday and the points being made on subsidiarity referred to the difference, geographically and climatically, between Greece and Finland. It would be advantageous that each individual state would have more input under subsidiarity. However, when we get down to the negotiations within the state and the roles that the governments and the administrations would play, we can use our own island as an example. There are major differences in geography, climate and constraints within the island. There is no comparison in how one would farm in Donegal and west Cork. Indeed, as two Leinster men, I can say that north Westmeath is worlds apart from the great conditions in the Commissioner's native Kilkenny. Yet, as the crow flies, we would be only a few miles apart. When the Commissioner does have to deal with subsidiarity, perhaps it is not going to be advantageous or clear cut. It may create some issues not yet foreseen and examined.
In every CAP review the word "simplification" is always a leader. I am old enough to have witnessed a few different CAP reforms. I did not see anything getting any simpler. I say that as a farmer. With each new CAP, things become a little more complicated for the farmer on the ground. I would go as far as to say that with subsidiarity we question the whole title of "common" agriculture policy. It is very hard to put the three words "subsidiarity", "simplification" and "common" into the one sentence when we are discussing CAP reform.
On market volatility, I welcome moves to police the retailing sector. Outside of farming circles and the political arena, the argument will be made that if farmers were getting a fair price for their produce, CAP, and indeed Brexit, would not play such a significant part in the overall situation of the sector. The single farm payment is 113% of the income of Irish suckler farmers and beef farmers. Think about that for a second. It is over 100% of their income. Brexit and CAP are very much interlinked and because the UK is a net contributor, as the Commissioner is aware, there is going to be a hole in the budget. At this stage we are most likely looking at a reduction of the budget, unless the Commissioner can pull this one out of the fire. This is at a time when Irish farmers need an actual increase in funding to counteract the losses from Brexit.
The Irish agricultural sector was the first to be hit by Brexit. The day after the referendum, it started impacting on our export business because of the fluctuation in sterling. I refer to the mushroom business in particular. While realistically we would be looking for an increase in the budget, it is more likely that there could be a reduction. I refer to how the remaining budget is distributed. There is a train of thought out there in Ireland that this is not as big an issue as farming organisations are making out. Many people think this is free money coming from Brussels. However, the entire rural community, the small and medium enterprises, SMEs, of Ireland, that are based rurally, are totally dependent on the CAP and the money that the farmers receive through the CAP. They may not even realise it.
A friend of mine in the Gallery runs an SME. It supplies the agricultural industry. If CAP was cut by 10%, that would in essence be a 10% cut in his turnover. That would definitely put one and possibly two jobs in jeopardy. That is just one example - it is replicated all over rural Ireland. It is not just the farming community that will suffer if CAP is cut. We need to sell that story more. We need the other sectors fighting on our behalf and not just the farm organisations.
We all wear the green jersey on this one. The Commissioner is not going to get any criticism from me but I plead with him to stay on the highways and byways of Europe. He has to get consensus from the governments still not prepared to up their contribution to the multi-annual financial framework. Ireland has agreed and I welcome that. If the countries still lagging behind can be persuaded, then at least the worst case scenario is that we will be able to hold the budget as is. However, if it is possible at all, I ask the Commissioner to get an increase.
I thank the Senator and call Senator Brian Ó Domhnaill on behalf of the Independent Group. He has five minutes.
I also welcome the Commissioner this morning. I commend him on his work as EU Commissioner for Agriculture and Rural Development. He has instigated, in particular, the simplification of the CAP programme. Farm organisations and farmers welcome that. It is a challenging time. However, it is also a time of opportunity in Europe. I am sure it is an exciting time to be there as European Commissioner, particularly in light of Brexit and the increased workload that has brought about.
I listened to and was intrigued by the Commissioner's contribution. It encapsulates everything that is important about Europe and also provides us with the opportunity that we need to reflect on why Europe was created in the first place.
It was created to bring about peace, stability and co-operation, not necessarily to move away from the nation state but to encourage states to work together. Certain segments of communities in Britain, particularly in the working class areas, have forgotten that.
I agree with the Commissioner on the fake news issue. It was fake news - propaganda - that sold the entire equation. People told blatant lies and then people voted to leave the European Union. There is a volume of work to be done at European level to counteract that fake news and those arguments. The evolution of the social media sites - Facebook and others - has brought that into stark reality, particularly in recent weeks.
The Brexit storm has huge consequences for this island. I agree wholeheartedly with my colleague, Senator Paul Daly, on the consequences for trade and agrifood, which is in the Commissioner's area of responsibility. It will have profound consequences for Ireland, and one of the challenging issues the Commissioner will have to deal with is the Common Agricultural Policy, CAP, after 2020 and the availability of funds to meet the demand.
With Britain leaving, the Farm Europe organisation has compiled economic data which shows that the CAP budget will be down in the region of €2.7 billion, the overall budget being approximately €12 billion. It has done modelling to show that would have implications for countries like Ireland if it was left at that. The budget could be down in the region of 4% on the overall CAP budget and if all of that was front-loaded into Pillar 1, the consequences would be even more stark.
There are major challenges ahead but challenges will always arise when the Common Agricultural Policy has to be reviewed. It is about finding manageable, workable solutions, and I am sure the Commissioner will be able to do that. I wish him well in that regard.
Never has it been more important for all political leaders here to work together in the context of Brexit. All political parties and none need to wear the green jersey on this issue and back the Government in the attempts at negotiation. There should be criticism where it is due but co-operation and collegiality is vitally important in the months ahead, particularly in the next 12 to 15 months. It is a crucial time for Ireland because the well-documented report compiled by Copenhagen Economics indicates that the consequences are very stark. Even if Britain were to opt for the customs union solution, we are looking at our GDP being impacted by a negative 3.5%; that is a conservative estimate. That will have profound consequences for some sectors in Ireland, particularly the agrifood sector. As Senator Paul Daly stated, that sector has been impacted already because of the exchange rate. That is only the start of the equation. The situation will get worse.
Sectors such as the poultry sector, for example, which accounts for over 80% of exports to Britain, could be wiped out. Will additional funding be made available out of the CAP budget to meet some of the consequences that Ireland, as a member state, faces as a result of Brexit and our over-dependence on exportation of agrifood into the British market?
I am delighted to join in the warm welcome for the Commissioner in Seanad Éireann. Time is limited, so I will confine my contribution to taking the opportunity to ask questions.
At the most recent visit to the Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach by the Commissioner for Economic and Monetary Affairs and the Euro, he took the opportunity to set out all the challenges facing Ireland under the new Common Agricultural Policy due to the withdrawal of Britain from the European Union. However, in the process of doing that, he provided reassurance to everybody present that we had the Commissioner at the table batting for us. We all know the Commissioner is invaluable in Europe at this time and that he is wearing the green jersey. I thank him for that.
The particular impact arises from the big hole that will be in the European budget when Britain leaves the EU. The Taoiseach has indicated that as we are now net contributors to the EU budget; he is prepared to give more providing other member states are prepared to do so. The Commission wants a bigger post-Brexit budget, and I understand its position, but what is the appetite for that among the other member states? How likely are we to see that happen?
Direct payments under the new Common Agricultural Policy are essential. They are required to keep farmers in business and ensure that we not only have food security but that we have quality and environmentally friendly produced food on our tables.
I ask the Commissioner about the definition of "active farmers", which I know is under consideration. In many parts of the country, and the west and north west is one of the biggest, farmers are eking out an existence on marginal land. They are trying to be as productive as possible but in many ways what they are doing lends itself only to part-time farming. Many suckler cow, sheep farmers and others are in that situation. The reality is that they are part-time farmers. Is there a chance that the interpretation of "active farmers" will go against them and not recognise the reality that they are doing their best? They are also having to contend with poor, unproductive but designated land, which provides further restriction and regulation on the methods they can use to get the most out of the land.
When I and a number of other members of the Oireachtas joint committee met the Commissioner just before Christmas to discuss the new Common Agricultural Policy, he explained to us that there will be increased environmental demands on farmers in regard to biodiversity, water quality and climate change. The Minister, Deputy Creed, is on record stating that if we are to ask farmers to do more environmentally, they need more money if there are costs associated with that. What is the thinking on that?
Successful farming is subject to the vagaries of the weather. The weather is not too kind, and there is great evidence of climate change. We see that with the predicament of grain farmers and the long winter we have had during which all farmers experienced fodder shortages and the need to house animals over long periods of time. Farmers are in a weak position in the food supply chain. The Commissioner has undertaken a body of work to try to address that on an EU-wide basis but where these farmers are dealing with multiple retailers and factories, what practical steps will arise from that? Where will they see the difference? The farmer is getting a very small payment compared to what the multiple retailers and the meat factories get. How can we better protect farmers and what practical steps can be taken in that regard?
There is a lot of concern among beef farmers in terms of Mercosur. Also, what EU supports are available for farmers in the areas of microgeneration of renewable energy, anaerobic digestion, biomass, wind and solar energy? Nationally, we have targets for 2020, which have been rolled over to 2030. Will we face penalties for every year beyond 2020 if we miss our current targets, which I understand there is a danger of doing?
The Commissioner is dealing with rural development. A major challenge in rural development is the way habitats and birds directives are being interpreted. They are blocking infrastructure development in terms of the building of roads. Habitats, birds and other species seem to be more important than development and progress for human beings. There is not a fair balance.
Regarding the Public Health (Alcohol) Bill 2015, will the Commissioner outline the views of other EU member states and the Commission on the proposed labelling of alcohol as causing cancer and so forth? While Ireland has wine producers, it is more the case that we have whiskey producers. I would be interested in the Commissioner's response.
The Commissioner is welcome. Like him, I am from the south east. I thank him for his update on what the Commission is doing. The engagement between the Commission and national parliaments is positive and should happen more, so I am pleased to see that the Commissioner will be attending the Committee on Agriculture, Food and Marine later today to discuss issues in greater depth. I am conscious, therefore, of the opportunity that we as Irish representatives have in the Commissioner's presence in the Seanad. I hope that we can address a wide range of topics related to agriculture and rural development without getting stuck on one or two aspects of the Commissioner's wider brief, as so often happens in terms of agriculture.
As the Green Party member of the Seanad's agricultural panel, I am interested in review and reform of CAP. The commitment from member states to a stable and adequate budget for the programme is essential. Countries like Denmark, the Netherlands and Austria have significant and strong records on environmentalism and playing a part in fighting climate change, so I would argue that they would be happier to support a policy that was considerably stronger in tackling climate change and improving the environment and habitats in rural areas. Farmers, who do more to protect the environment and engage in positive social contributions to their communities, deserve some form of reward. I hope that the Commissioner, his colleagues in DG AGRI and member state governments will seek to entice countries like Denmark, the Netherlands and Austria into remaining our steadfast partners by allowing them to sell CAP in the way it should be, that being, as a comprehensive and well-rounded package of measures that support farming communities, agribusiness and industry, promote good environmental health and contribute to solving the climate crisis. Currently, it is perceived in those countries as being mere handouts to farmers, which is difficult for them to argue for domestically, given the often industrial scale of agriculture in their countries.
As the Commissioner is well aware, the European Green Party in the European Parliament has a long and strong record on the greening of CAP. Ours is a vision of an agricultural policy that promotes diversification, something that is severely needed in Irish agriculture, as seen in the recent fodder crisis and the hopelessly low level of horticulture undertaken in Ireland. We need greater supports for less ecologically destructive organic farming practices. We must be honest about the limits that we as a country and a planet can face when discussing increases in herd sizes in Ireland and across Europe.
I did not hear the Commissioner mention forestry policy. Although mostly a national competency, it is intrinsically tied to agriculture, especially as we adapt the way we farm to the warming future ahead. The Seanad discussed this issue yesterday. I am critical of current Government policy, which pushes an environmentally and socially damaging programme of non-native clear-cut monoculture plantations, the exact opposite of what we in the Green Party would advocate. In his reply, will the Commissioner address the next round of CAP talks and how the Union envisages helping member state governments in supporting a sustainable model of forestry that will support farmers, stabilise our soils and improve livelihoods in rural areas?
I would like the Commissioner to address two further issues, those being the controversial reauthorisation of glyphosate and the impact of neonicotinoid pesticides on our pollinators. A number of groups held a large demonstration outside Leinster House yesterday, including the Federation of Irish Beekeepers Associations, which is concerned about the future of pollinators and bee populations. Beekeeping is a way to earn money through small business, for example, the sale of honey and other products related to bees. As such, it would be a shame to see pollinators destroyed by the policy of using pesticides that are killing off various species.
Last week, the Seanad debated Brexit and the North in the presence of the Tánaiste, where we had an opportunity to put across our concerns. I do not believe I need to say it to the Commissioner, but Europe must defend the Good Friday Agreement. It is an international agreement which protects our peace process and our island. One of the elements underpinning our peace process is the fact that both jurisdictions on the island are within the EU, allowing for the free movement of goods, people, services and capital. That element is critical. My colleague, Senator Conway-Walsh, will elaborate further on this matter.
I will briefly flag the significant issue that is the Mercosur deal. When the Commissioner attended the major public meeting in Kilkenny, he would have heard from farmers about their concerns. More than most in this country, the Commissioner is aware of the threat that the Mercosur deal poses in what is already a tough industry. Will the Commissioner ensure that a proper balance is found and we do not face a major threat? The Irish beef sector is already dealing with the impact of Brexit, and it cannot deal with being flooded by more beef.
I wish to touch on the European Commission's draft proposals regarding unfair trading practices, which are a significant issue for Irish farmers. Historically, they have not got a fair price for their produce across the various sectors. The proposals could have been stronger. The Commissioner stated that it was up to legislators to strengthen them, but the Commission should have made them stronger from the start and let legislators deal with them then. There will still be opportunities for unfair trading practices. For example, I visited a pig farm on the Inishowen Peninsula in recent days. The farmer is losing a considerable amount of money every year. It might be asked why the farmers are not pooling together to deal with the meat factory in question, but the factory pits them against each other. That is how it operates. As the Commissioner knows well, the meat factories, meat cartels and major multiples have been taking the mickey for too long.
This issue has to be dealt with at European level, given that we are in a European market. We have known about the issue for a long time. European payments under CAP have turned into a subsidy for meat factories and supermarkets rather than farmers. It is keeping the factories and supermarkets profitable and leaving our farmers struggling.
That takes me on to my final comments, which relate to CAP 2020. According to today's Irish Farmers' Journal, it has got a hold of the first draft, which still has to go through a number of phases. The editorial contains kind comments for the Commissioner but also highlights some challenges for him. If the figure of a €60,000 cap is correct, it cannot increase in Ireland. We must introduce a cap for payments and we need a fair distribution of payments across farmers. I would argue that the €60,000 figure should decrease. That is a major issue.
The Commission needs to simplify the system. I am concerned about comments by the European Court of Auditors in recent days regarding more tests.
I am also concerned about off-farm income.
The Commissioner knows many farmers in Ireland need off-farm income to survive. Most operators who keep sheep and cows, and particularly younger farmers, need off-farm incomes to keep the roof over their family's head. We will watch that with real concern. I ask the Commissioner to be particularly mindful of the type of farming model we have in Ireland.
There is the idea of the individual governments putting together the type of payments suiting their countries under a European framework. It looks good on first reading but as Senator Daly has said, there can be issues with it as well. The Commissioner knows the challenges we face with farming in Ireland and he has been in the Irish political landscape for a long time. I expect this version of the Common Agricultural Policy, CAP, will be fair to our smaller and medium farmers in particular as they are struggling across this State.
I welcome the Commissioner to the House, along with his officials from Brussels. I believe certain officials got a warm welcome from certain Senators last night. It is very difficult to cover all the matters raised by the Commissioner in his lengthy address in three minutes. Much to the disappointment of the 63 members of the Irish Farmers Association in the Glencullen-Sandyford ward I will not focus too much on his specific brief. The Commissioner mentioned the new alliances for Ireland within the European Union, and within the agrifood sector and CAP reform, it is vital we remember our long-standing and, I hope, future prosperous relationship with the French. They have always stood well by Ireland and they will continue to do so. I welcome the Commissioner's comments on trade deals and he has done much work already in countries like Malaysia and Vietnam, coming to the fore in new trade deals that have the potential to be extremely beneficial to Ireland in agrifood and dairy sectors.
I will focus my remaining time on Brexit and the future of Europe. Brexit has forced us to think about the future of Europe but it is something we probably should have done a number of years ago. As the Commissioner noted, the worldwide economic crash probably got in the way in that respect. There is a great lesson coming from Brexit, and I say it both to members of my own party and Members whose long-time Eurosceptic parties have found a new enthusiasm for the European project. As the British people have found, one cannot spend 43 years kicking a project or idea and blaming the foreign bodies in Brussels and Strasbourg for every domestic woe and then spend six weeks trying to convince an electorate to stay in it. We must be conscientious in our rightful criticism of the European project and we must also give credit where it is due. That forces us to be much more realistic in what we can do within the European Union.
The Commissioner mentioned that Ireland is a small country of 4.6 million people on the periphery. When we applied to join the European Economic Community, EEC, in the 1960s we would not have been considered unless the UK applied too. The UK has now made the regrettable decision to leave but we have made the correct decision to remain. In doing so we must throw ourselves into the European project and show a level of enthusiasm for Europe where we might sometimes have been found wanting. On the European side, the European Commission in particular needs to learn how to sell Europe. For too long, the European Commission and the European Union have gone out of their way to tell the people of Europe how they can give out about the Union. They spent 25 years paying Mr. Nigel Farage so he could complain about the European Union. They have not said how this is a really good thing, with 60 years of peace on the continent, and as Senator Ó Domhnaill notes, it is worth defending. This country has seen economic success because of membership of the European communities, and it is worth defending. We must continue doing it and I hope the European Commission hires some good old-fashioned marketers and sales reps, taking this on the road.
I give a very warm welcome to Commissioner Phil Hogan and members of his cabinet, Mr. Tom Tynan and Mr. Dermot Ryan. It is a new Seanad and the Commissioner cannot say we have not had some reform, as at least we moved house from one end of the building to the other. There has been a major change but the Seanad remains very active.
I compliment the Commissioner on a very wide-ranging speech that I know will get great attention in the 27 other countries, including Britain. It is a wake-up call for the British Government, if it needed another one, to realise what is involved with Brexit. The Commissioner has been very outspoken and genuinely straightforward with his views, and I hope it has an influence. It certainly has influenced our negotiators and I hope it has had an influence on the other side as well.
One of the lessons of Brexit is the need for greater diversity in Irish exports, particularly agrifood products, which continue to have a very significant if declining dependency on the United Kingdom market. As a former trade Minister of State, I was on several trade missions with State agencies and Irish companies and I know the value of finding and opening new markets. I congratulate the Commissioner and the Commission on the successful conclusion of the new agreements on trade with Mexico last weekend. It can be added to successfully negotiated agreements with Canada, Japan and Singapore, and I note this latest agreement was welcomed by the Irish dairy and whiskey sectors. What effect will this have on beef producers here? What is the percentage of beef imports from Mexico, and could there be a detrimental effect on our exports to the European Union?
I also ask about the EU's trade agenda, particularly in the context of the United States where, increasingly, there is an isolationist or protectionist trade policy. I commend the Commissioner as I followed his progress and when the matter arose, he was immediately involved with the Irish and European industries to ensure that a reciprocal approach would be implemented. If the US decided to put a levy on our whiskey, the Commissioner would certainly have looked after Jack Daniels, bourbon and everything else, so it would have worked both ways.
The Commissioner is aware there is a fodder crisis in Ireland. Is there any emergency support from the European Union for farmers not just now but in the long term with climate change in mind? There is a crisis, to some extent, because of the abolition of the milk quota. During this crisis there have been visits to many farms by the Department of Agriculture, Food and the Marine inspectors dealing with matters relating to the European Union and young farmers. Who gets the blame for this? It is not the Department but the Commission or the European Union. They did not send inspectors in the middle of the fodder crisis to check on whether a young farmer is fully compliant. That could have waited. The European Union is projected in a negative fashion all the time by State agencies that want to put the blame back on the Commission. I thank the Commissioner and wish him success in his continuing role. He is getting very fond of this House but I do not want him back because I want to see him reappointed as Commissioner. He is doing a tremendous job.
Mr. Phil Hogan
Give the Senator another minute.
I have met his colleagues in Europe because I am a member of the Conference of Parliamentary Committees for Union Affairs of the European Union. They know the Commissioner and he knows them. He is very influential for this country.
Come over to this side.
I welcome Commissioner Hogan to the House. His contribution today was important. It is timely for the inherent contradictions and irreconcilable aims being pursued by the Tory Party Government in Britain to be called out for what they are. We face an alliance of the likes of Mr. Jacob Rees-Mogg, Mr. Michael Gove, Mr. Boris Johnson and Mr. Liam Fox telling the British public that there is some great global trading status for Britain that is compatible with a continuation of its access to the European markets on an unrestricted basis. This is a falsehood. In Westminster today there is the beginning of the dawning of reality as to where Britain's real interests and potential choices are to be made.
The Commissioner set out in welcome and stark terms the fact that by June - only eight or so weeks away - the issue will effectively have to be resolved. Britain's ambivalence and ambiguity on these fundamental matters must be resolved one way or the other. The Commissioner mentioned briefly what Mr. Rees-Mogg said about Ireland and some Members may not have heard his precise comments. Effectively, he argued that if there is no deal of the kind he wants, he would impose 70% tariffs on Irish beef and bankrupt Ireland.
That was the threat made. We have to remember that Michael Gove spoke and wrote in the most trenchant terms against the Good Friday Agreement. He said it was a betrayal of the unionist position and the British position in Northern Ireland. We have to realise that we are dealing with people who are in a minority in Britain, but as with our current Government, sometimes vocal minorities can stamp their feet and get their way. I make this point in a different context but Mr. Hogan knows what I am talking about. We are, however, coming to the moment of truth.
Senator Richmond has made the point, as has the Commissioner, that Ireland must take a long hard look at our relationship with Europe. I believe that the Hanseatic League of the Nordic and Baltic states and the other states that are less popular at the moment - the Visegrad Group - and Austria and Italy are not ad idem with the French desire to create a Berlin-Paris axis where those two countries can bestride the world. Although Mr. Hogan has spoken about solidarity and about Ireland perhaps taking another look at our security, I would warn against trying to revise our constitutional ban around participation in EU defence. This would be a lost cause and it would be a step too far.
I thank the Mr. Hogan for his frank words. I hope that other people in other places are heeding them and realising that their bluff cannot go on indefinitely.
Cuirim fáilte roimh an Commissioner. The EU is a precious regional entity in a world that has a lot of vulnerability and threats. We should remember this. It is, however, a hard place to love. This point has been made by various people very sweetly.
With regard to Brexit there are a small number of EU member states that make up the majority of the population - the big beasts. There are many states within the EU that are medium and smaller sized. The EU needs to be very clear that it will stand by Ireland, which is a small state. The EU's own reputation will stand or fall on this matter.
Mr. Hogan spoke of how Brexit might have torn the EU apart and how President Juncker's response was to ask what kind of EU we want. That was in 2016. In 2010 the EU ratified the UN Convention on the Rights of Persons with Disabilities. I put it to Mr. Hogan that this is a commitment between the EU and each of its member states to do the right thing by its 80 million people who have disabilities, and their families. This is 16% of the EU population.
The Commissioner has said that Ireland is at the forefront in trade deals with fair and rules-based trade. The late Peter Sutherland has left a legacy - all too soon - in that regard, as he did later in his career with asylum seekers. Mr. Hogan's portfolio is agriculture but it is also about jobs growth, rural development and smart villages. There is a lot at stake for people and families with disabilities, and for others. The two sides of the coin need to be kept balanced and worked together.
I travel to various countries in my work as an advocate for those with disabilities. We do not find fellowship because we are from different EU member states, it is because we have the common experience of living with a disability. There are lots of groups within EU member states that are bound by their common experience of difficulty in their lives, whether it is people with disabilities or others. This is an important aspect to remember. It is a potential for greater cohesion.
Reference was made to external threats but threats can also come from within when there is no social cohesion, and when people who are within the European Union do not feel it is their home or that it is standing by them. I have engaged with two of the Commissioner's former colleagues in various committees for education and budgetary oversight. I have not felt assured by their understanding of the disability side of their brief. To use an agricultural analogy, I would like Mr. Hogan as one of their colleagues to give them a touch of the prod now and again when it comes to remembering that people with disabilities are in every community and it has to do with education, with budgets and with the whole gamut of living. I ask that Mr. Hogan would also renew within his own brief the focus on people with disabilities and their futures.
In his statement Mr. Hogan spoke of fake news being political mischief. I do not agree with the Commissioner on this. I believe it is an absolute attack on democracy and on rational discourse. It is a really big issue.
I thank the Commissioner for coming to the House. I apologise that I was late in getting to the Chamber. I was at the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach with our two MEPs. Before I give my substantial address around human rights in the North and the impact of Brexit on human rights, I want to ask two brief questions. With regard to the Leader review-----
I remind the Senator that she has three minutes.
I thank the Cathaoirleach. I want Mr. Hogan to know that it is very important there is a multi-denominational approach to the Leader review and that it does a proper analysis on the current delivery model as opposed to the previous delivery model. How can the TEN-T projects, which were withdrawn by then Minister for Transport, Tourism and Sport, Deputy Varadkar, be reinstated and put back on to the multi-billion euro trans-European structural funding stream? These are my two questions, both of which are vital to the west.
It is fully understandable that since the crisis provoked by Brexit, the focus in the Oireachtas, in the European Parliament and in Britain has been around the economic consequences for Ireland, North and South. There is, however, another very important issue that does not get due attention, which I believe it is long overdue. It is the threat posed by Brexit to the many long established human rights in Ireland, North and South. The human rights protections that derive from the EU - not from Westminster - that have been embedded in the law for the past 40 years are now in jeopardy. Perhaps Mr. Hogan will give the Seanad an update on the promised annex listing the human rights to be protected in the final withdrawal agreement. Where is that annex currently?
Does the Commissioner know if people in the North will lose their right to vote and stand in the EU election? Will the people of the North lose their representation in the European Parliament as a result of Brexit? Let us remember that the people of the North voted to remain in the EU. This democratic result is being ignored by the British Government and by the unionist parties. It is a flagrant abuse of people's democratic rights, specifically their right to vote. Does Brexit remove the rights of those citizens in the North who carry Irish passports and who are EU citizens by virtue of their passport and citizenship? Does Brexit remove clause 6 of the Good Friday Agreement that guarantees Irish or British citizenship and Irish-British citizenship to the people of the North? Will Brexit remove the common travel area of the EU? This is a central arena for the single economic market. Will Mr. Hogan clarify the situation around the free movement between Ireland and Britain? This has been part of our lives for so long on this island. Will Brexit threaten this also?
These are just a few, small samples of the questions that arise from Brexit and the threats it poses to the human rights of people in the North and South. People in this country need answers to these and other questions with regard to their human rights. If we do not have human rights then we do not have anything.
Ar an gcéad dul síos, gabhaim buíochas leis an gComisinéir as ucht na hóráide iontaí a thug sé inniu. In welcoming Mr. Hogan I also welcome his former constituency colleague and friend, Minister of State, Deputy John Paul Phelan, to the Visitors' Gallery. The Commissioner's address to the Seanad today is, as Senator McDowell has said, timely and necessary.
We very much welcome and applaud the remarks of Mr. Hogan. I hope the UK Government and the Brexiteers will listen to what he said. Today we have called out the falsehoods in their misdirected approach to Brexit. I commend the Commissioner for his courage, not just today but in general. He is a member of the European Commission but he is also wearing the Irish jersey and has done so in a very positive way to bring our case to the European continent. There is no "them and us" in Europe. We are all Europeans, of Europe and working for a better Europe. Senators Ó Domhnaill and Richmond spoke of its benefits to us as a country, a people and a union. The Commissioner should take Senator Richmond's point back to promote Europe and sell its positivity.
I congratulate and thank the Members for their contributions. Our relationship with Europe has been a positive one. Through being a member we have brought huge economic, social and cultural change to our country and people. We are no longer the inward looking protectionist country. We are outward looking, innovative and highly progressive. I ask everyone, as Senator Mulherin said, to engage in the debate on the future of Europe and to do so as citizens and not just to focus on the institutions. Let us look at what Europe has done and can do. The Commissioner referred to trade deals. Are we not economically better because of those deals? I commend the Commissioner's work.
The nation will have challenges in the post-Brexit era. It must face them as an active member of the EU. That means Members of this House being involved in Oireachtas committees. I commend Senator Richmond for his role as Chairman of the Seanad Special Select Committee on the Withdrawal of the United Kingdom from the European Union which, long before it became popular to do so, raised issues that are now coming to the fore. That is the benefit of being a Member of this House and having a standalone Brexit committee. We have Members who are committed to, and interested in, challenging the views of others.
I commend Mr. Hogan for his role as a Commissioner. Many Members have mentioned reform of the Common Agricultural Policy, CAP, and the importance of agriculture to our country. We remain a strongly agriculture-based society and country. We are fortunate in having someone of the calibre and stature of Mr. Hogan as a Commissioner. We stand at a crossroads for Europe and do not know what the future looks like. We must question, probe and put forward solutions. I thank the Commissioner for being here, for his work and for his commitment to Ireland and its people. I thank him too for his many years of public service and wish him well in his remaining years as Commissioner and perhaps, as Senator Leyden said, for a second term.
Mr. Phil Hogan
I thank the Members for their kind remarks and will do my best to provide answers to their questions. Senator Paul Daly is right to be concerned about the budget for the CAP, which several Senators mentioned. The next programme period will be challenging, when we will be down €12 billion because the United Kingdom is leaving the European Union, and many member states have already agreed at European Council level that they want to see some programmes such as security, migration and defence co-ordinated. It is estimated that this will require another €12 billion over seven years. In the absence of additional contributions from member states and new sources of additional income for the European Union, there will be a cut in expenditure. The challenge is for us to get the balance right on where those cuts should be.
I also want to reflect on several Senators' remarks about the fair distribution of payments in respect of the CAP. At the moment there is a cap of €150,000 on payments in Ireland. We will be proposing a €60,000 cap for all farmers in the European Union. Whatever I propose it will be a matter for the member states and the European Parliament to agree. We can only make a proposal but I am concerned about this issue. Whatever savings can be made from the proceeds of this cap can be kept within the member state and redistributed to small and medium-size farmers to ensure that it limits the impact of any particular reduction in budgetary terms for those farmers who need it.
Part-time farmers will not be excluded from payments in the CAP. These people are actively involved in farming the land. Only those people who engage in hobby farming, or sofa farming as we call it, have reason to be scrutinised in respect of getting money from the CAP for not being engaged in agriculture. It is a matter for the member state to tease out an appropriate way to deliver a fair distribution of payments but also to prioritise the young and genuinely active farmers. We have given subsidiarity to the member states in recent months to do this.
The Commission has also been very much involved in trying to help Irish farmers through these recent difficult months. Many Senators have raised this, understandably. I met 700 farmers from all over the country in my native city of Kilkenny last Friday evening. I had to admire that they were able to be there given that three fine days had arrived for the first time since the autumn but people are always concerned about their future. When I was asked to advance some additional moneys from the basic payment scheme last September to help the cashflow of farmers through the winter I responded positively by increasing the 50% of advance payments to 70%. When I was asked by the tillage farmers' community and the Minister for Agriculture, Food and the Marine to abandon and derogate the greening measure for what is called the three-crop rule for 2018 because farmers could not sow their crops until recent days, I immediately responded politically to say we will do this. When the Minister for Agriculture, Food and the Marine asked me if we can actually pay out the final green low carbon agri-environment scheme, GLAS, payments, which are significant balances to be paid, I immediately responded that they could be paid in May of this year. While I know this will not be a big deal for those who have suffered a lot, it is some income that they need at times of difficulty and inclement weather conditions.
Simplification of the CAP is very urgent and necessary. I have brought in at least 100 changes already in secondary legislation. As Senator McDowell knows from his time as Attorney General, the basic Acts have to be opened before meaningful reform can be made. This is what we will do in our CAP legislative proposal in the first week of June when we will attempt to introduce a new model for delivery of the policy to ensure that it is less complex for the farmer and the member state, but particularly the farmer. I emphasise this new delivery model is not re-nationalisation of the policy, the word "common" will remain in the CAP in so far as the policy will be dictated and decided by the member states in the European Parliament at Brussels and European level. Implementation in the form of flexibility and subsidiarity will be decided in the context of a CAP strategic plan that each member state must submit to the European Commission for approval. The Minister for agriculture of the day here will be able to consult with the farm organisations and the Houses of the Oireachtas to draw up a plan that fits Ireland's situation provided that they meet the nine specific objectives of the CAP that must be met at European level. The objectives will be in economic, environmental and social aspects of the policy. If Ireland does not meet them the plan will not be approved. This is how we make sure we have a level playing pitch and continue to have the Single Market of which, ironically, Margaret Thatcher was the architect. In doing so we will be able to reduce the need for a rules and compliance-based approach and change to a performance and results-based approach.
We will have targets and indicators in the same way as we have at present for the Water Framework Directive or various environmental policies. We will do so in a common-sense way. This will allow the flexibility of member states. Of course, we do not want to see member states then involved in gold-plating some of the initiatives that we will be taking. We will be monitoring this aspect of it as well before they get approval.
Forestry was mentioned by Senator Grace O'Sullivan. It is the case that forestry is essentially a member state competence. The Senator is correct. However, forestry is an essential element in the climate challenge and will also make a significant contribution to the development of the bio-economy in Europe which has considerable job potential. We will be giving specific attention to this in the rural development policies of the European Union. I understand that planting levels in Ireland are currently approximately 5,500 ha per annum. That is low against the target of 10,000 ha per annum that was in the rural development programme. Ireland is facing a challenge in meeting its 2020 and 2030 climate objectives. This is another reason we must look at how we can use the forestry sector in a planned way that can give us more carbon sequestration to meet these objectives on climate and the environment. Agriculture has a role to play.
I always subscribe to the basic philosophy that there should be nobody getting any money unless he or she will do something for the public good. This would be the philosophy of the Common Agricultural Policy. If someone is getting money in direct payments for income support, we want him or her to do a little bit more than he or she has been doing in the past for environment, climate and public goods. Farmers, perhaps, for the first time, realise if they want European taxpayers' money and they want their budget protected, they have to do that little bit more to respond to the public concern that there is 34% of the EU budget going to agriculture and we need to do more. Of course, many do not understand that farmers are the only sector that gets money directly from the European Union for what they do. No other sector gets that. That is why it has been a successful fully-funded policy of the European Union since 1962.
In any area of environment, the environmental architecture will be constructed in such a way in the CAP to meet our targets and do better to help us to achieve our international obligations under the Paris Agreement under the sustainable development goals. It is common sense that our farmers would want to pass on their farms in better condition, as to soil quality and otherwise, to the next generation. It is short-sighted if one wants to destroy one's natural resources. Farmers understand that, probably better these days than they did in the past.
Renewable energy, as Senator Mulherin mentioned, is an important issue. There has been a little confusion in some quarters that the 2020 targets for renewable energy that we have under the Renewable Energy Directive would be rolled over in some way into the 2030 targets. That is not the case. The 2020 target must be adhered to and we must be proactive in what we want to do in renewable energy to reduce the dependence on fossil fuel in line with what we have signed up to as a member state regarding the Renewable Energy Directive. This morning I met the Minister for energy, Deputy Naughten, about this to ensure that we all know exactly that there is no real free pass post-2020 in relation to the Renewable Energy Directive and we would be running into the trouble of perhaps infringement proceedings if this was to happen.
In successive trade agreements - I acknowledge that former Minister for trade, Senator Leyden, would have a particular interest in this - we have made a lot of progress in recent years. While President Trump wants to remain protectionist, the European Union has found an opportunity to go into the marketplace and replace the United States, in many cases, in doing good deals in Canada, in Mexico now, in China and Japan, and Vietnam, and of course we are working with Mercosur. Whether it is agriculture, financial services or pharma, there will always be sensitivities about certain areas of economic activity. However, this mandate that the Commission works under is agreed by the member state governments and the European Parliament before we go and negotiate at all.
If people are saying that they have a particular problem and sensitivity about a sector, such as beef in the Mercosur, that is already reflected in the mandate of the member state and we are able to flag that to our opposite numbers in Mercosur countries. I can assure the House that there will be no deal between the European Union and Mercosur unless we have high-quality standards adhered to, good sanitary and phytosanitary conditions, and that there will be an offensive interest in the context that we will get something in return, in particular, on the dairy sector. Of course, Germany, France, Italy and other countries will be anxious to do a deal on the basis of cars and car parts. Each country has its own priorities but these are reflected in the mandate. There has been little movement in recent months on Mercosur. I have no indication that there will be movement because we are in the middle of Brazilian elections as well at present and the Brazilian political situation is quite troubling.
In the context of trade, we also have in recent days concluded a deal with Mexico. These are important in the context of what Senator Leyden stated about diversification of the marketplace with the challenges that we will inevitably have with Brexit, where we have 43% of the total agriculture production here in Ireland going to the UK but, as one does not often hear, there is 53% of agricultural products from the UK coming to Ireland. There is an integrated trading relationship around agriculture. We must continue to impress upon member states, the Commission and the European institutions that are involved in these negotiations how Ireland is vulnerable in terms of economic shocks, particularly around the agri-economy area, perhaps more than any other member state. This is very much in the consciousness of Mr. Barnier, the chief negotiator. I am glad to be able to say that he will be visiting Northern Ireland and the Republic of Ireland in the coming days. He has an intensive programme where he will hear at first hand many of the issues that the Senators have raised as well.
On the Public Health (Alcohol) Bill, the amendments to the Bill were notified to the member states and the European Commission in January last. The deadline for responses was Friday last. The European Commission responded with comments, which were communicated to the Irish Government on Friday last. Both Portugal and Italy responded with what are called "detailed opinions", which effectively introduces a three-month standstill on the progress of the Bill. It is now a matter for the Irish Government to decide how to react to those detailed opinions. The Commission expects the Irish Government to address these issues raised in the comments. They are largely around an issue, in particular, about what is the definition of a cancerous product as to whether it is based on science or World Health Organization reports, and labelling arrangements and nutrition arrangements. These are all quite difficult issues when they have to appear on the label.
I am happy that Senator McDowell mentioned the context of the ongoing discussions on Brexit and that some irresponsible comments were made by some Members of the House of Commons. The Senator, in his former roles as Minister for Justice and Attorney General, will understand better than most the hugely important work that was done in the Good Friday Agreement. Mr. Barnier has been at pains on every occasion to reflect the genuine concerns we have, on the island of Ireland and, indeed, in the United Kingdom, to ensure that nothing happens that will unleash unintended consequences that in any way water down the Good Friday Agreement. I assure Senator Conway-Walsh of the same.
The contents of the Good Friday Agreement are sacrosanct when it comes to the European Union's negotiating mandate. Citizens' rights and human rights, and all of the issues Senator Conway-Walsh raised, will continue to be part of the normal day-to-day activities of people, whether they are North or South. The common travel area will be protected. Of course, it is dependent on what the United Kingdom proposes because it takes two sides to negotiate a deal. We would hope to be able to convince them that there is a new look required in customs partnerships. They need to look at their red lines around the customs union-Single Market regulatory alignment because otherwise they narrow their options, both for a deal and about what they could consider as a landing ground for a reasonable outcome on any future relationship or free trade agreement between the European Union and the United Kingdom.
I note Mr. Barnier's assessment of the stated position of the United Kingdom at present. We are fortunate that Mr. Barnier is involved in these issues because he understands, from the time he was Structural Funds Commissioner, about the peace and reconciliation fund that is so critical to continue as well. We all know that the nuances of the traditions of political persuasions on the island of Ireland are not easy to explain to people who are a long way away from this island but Mr. Barnier gets these nuances. Hopefully, that will continue.
Many asked if the model we agree will be a Norwegian model or an Icelandic model.
Will it be a model around the Swiss model? I do not know what model can be looked at if there are so many red lines from the United Kingdom side. It narrows the scope considerably into a free trade agreement. That is not what the objective of the European Union is, but it seems to be the objective of the United Kingdom. I hope that as Senator McDowell has said, there is a reawakening of these issues in the coming days and weeks in the United Kingdom and that they will be able to help to achieve a better outcome than they are proposing at the moment with their red lines in the interest of their own people, in the interests of business and in the interest of good relationships between the UK and Ireland and the UK and the European Union. Notwithstanding the fact that we are sorry to see the result of the British people in terms of this issue, all of us want to have a close relationship on the islands of Ireland and the UK, but equally between the UK and the European Union.
I call on the Leas-Chathaoirleach, a very important Member from the kingdom to thank the Commissioner.
It is good to have the Commissioner back again for a second time in Seanad Éireann and particularly to have this update he has given us at such a crucial time in our history. To have someone at the nerve centre with all of this Brexit uncertainty is vitally important in ensuring the Irish position is to the fore and is not overlooked.
No doubt Mrs. May will refine and update her mention of the speech to which the Commissioner referred because there is no doubt that some form of customs arrangement will be necessary. Despite all the discordant voices in Tory Britain and in the Conservative Party, I think it would be unconscionable that Britain would leave without a withdrawal treaty agreement and an implementation phase cum transition deal. That will be necessary. As in all negotiations of this serious kind, we will probably have to await the 11th hour for a satisfactory outcome. That is it. What the Commissioner has said to us was very interesting. He is on top of the situation so again we thank him very much.