Dáil Éireann Debate, Tuesday - 1 July 2008
77 Deputy Michael Creed asked the Minister for Agriculture, Fisheries and Food his views on modulation proposals outlined in the CAP health check; the impact of such proposals on rural development; and if he will make a statement on the matter. [25677/08]
View answerFor payments in excess of €5,000, additional compulsory modulation at a rate of 2% per year is proposed from 2009 to 2012. This would bring the modulation rate to 13% by 2012. A further 3% modulation is proposed on payments in excess of €100,000, an additional 6% is proposed on payments over €200,000 and an additional 9% is proposed on payments above €300,000.
The objective is to use this funding to finance measures directed at addressing what the Commission has described as the "new challenges" of climate change, risk management, bio-energy and biodiversity. As the proposals stand, all of the additional modulated funds would remain in the member state of modulation and could be allocated to farmer payments under the rural development programme.
In the negotiations to date a wide range of views have been expressed by member states on the Commission's proposal on modulation and it is not clear what finally will be agreed. I have opposed the proposed increases in modulation, together with several of my fellow Ministers for Agriculture. I have concerns about significantly reducing the single farm payment at a time when farmers are still adapting to the impact of decoupling and believe it is needlessly disruptive to change the Rural Development Programme 2007-2013 so soon after its adoption. However, I welcome that the funds released through additional modulation could be used for farm payments in Ireland.
Ireland strongly supports pillar 2 of the Common Agricultural Policy and is providing a high level of national funding for rural development. We already devote a substantial proportion of rural development funds to addressing the new challenges identified by the Commission.
I have to hand a press statement issued by the Minister on 28 May, subsequent to the most recent publication of the health check proposals. In respect of the modulation proposals, the Minister's statement reads:
In relation to the proposed increase in modulation . . . the Minister confirmed that any funds raised in this way would remain in Ireland and could be allocated to agricultural schemes and therefore Irish farmers would not lose under the proposals.
I wish to establish clearly that it is the position of the Government that Irish farmers are key to any rural development proposals and that any proposal emanating from the Commission which proposes to take money out of the pockets of farmers and invest it in rural development, via the Leader groups or otherwise, is entirely unacceptable. Robbing Peter to pay Paul in the name of rural development is unacceptable, notwithstanding the clear implication of the Minister's statement that this is an arrangement and proposal with which he could live. As time is critical, I wish to lay down a clear marker that the proposal to increase modulation to 13% by 2012 and to take money out of farmers' pockets is entirely unacceptable.
I agree with the Deputy. The statement he quoted from me was issued immediately after the publication of the Commissioner's proposals on 27 May, which was the first time I had sight of them. I repeat that Ireland is strongly opposed to increased rates of compulsory modulation. The CAP health check process has just begun. I responded previously to a parliamentary question tabled by the Deputy on the processes begun in respect of a number of issues. Working groups have been established, comprising representatives from each member state, to flesh out the proposals in each strand of the health check. At the Council of Ministers meeting I outlined that Ireland was strongly opposed to the modulation proposals.
The aforementioned statement simply outlined that in the past funds that were modulated, if one wishes to describe them as such, did not necessarily remain in the state from which they were taken. Under the new proposals, were modulation to be implemented, such funds would remain in the member state concerned. It is unclear what programmes can be assisted, were the modulation proposals to be implemented. The Commissioner may envisage some schemes that would be on-farm, rather than general, rural development programmes. While this still is unclear, I have stated clearly, as will officials within the working group, that Ireland is opposed to the modulation proposals outlined by the Commission. Only an initial discussion took place at the meeting or at subsequent Council of Ministers meetings. It still is early days and my officials will be doing their utmost to ensure we secure the best outcome and reiterate in the strongest possible terms Ireland's opposition to the modulation proposals.
Does the Minister accept that the single farm payment, by virtue of its static nature since its introduction, is of declining value year on year to the agricultural community? I refer to further tampering with it, by way of reduction, in the light of agri-inflation in particular. The Minister is aware, for example, that the prices this year of fertiliser, energy and feedstuffs have increased by 62%, 20% and more than 20%, respectively. Any tampering with the value of these payments will adversely affect both agriculture and rural development because farmers are key to vibrant rural communities.
I refer to the French Presidency which commenced today. When President Sarkozy visits Ireland in the near future, will the Minister avail of the opportunity to impress on him and the French who, in general, are supportive of the Common Agricultural Policy that this matter will not be tolerated by Ireland in the context of the health check?
As for the Deputy's point on the visit by President Sarkozy, he is aware I have met the French Minister for Agriculture and Fisheries, Michel Barnier, on a number of occasions when we discussed issues of common concern and interest. I will continue to so do within the Council of Ministers with like-minded Ministers. A variety of views have been expressed by Ministers from various member states regarding the CAP health check in respect of milk quota, modulation and decoupling. However, I agree fully with the Deputy, in that decoupling is relatively new and Ireland's farming system has adapted to it well. When farmers signed up to it, they were of the opinion that it constituted both a set and significant part of their income. I am opposed to farmers losing part of their income from the single farm payment.
