Dáil Éireann Debate, Thursday - 19 December 2013
310. Deputy Michael Healy-Rae asked the Minister for Agriculture, Food and the Marine his views on correspondence (details supplied) regarding the removal of retrospective penalties imposed on farmers; and if he will make a statement on the matter. [55117/13]
View answerThe Deputy will be fully aware of the value of the EU funded Direct Payment Schemes to Ireland. Each year farmers in Ireland benefit from funding of over €1.5 billion under Schemes such as the Single Farm Payment Scheme, the Disadvantaged Areas Scheme, the Agri-Environment Schemes, etc. This comprises the entire net income of many thousands of Irish farmers. The European Commission has an obligation to ensure that Member States manage and use the EU funding granted to them in accordance with the provisions and consequent restrictions governing the Schemes and general financial provisions. Under the Common Agricultural Policy, this is done by way of a Clearance of Accounts procedure. This is a formal process and both the Commission and Member States are obliged to adhere to the requirements laid down in the legislation.
In general, the process involves audit missions to the Member State by Commission officials; follow-up correspondence between the two parties on the findings of the mission and the observations and remedial actions undertaken by the Member States. There is also a formal bi-lateral meeting between the two parties followed by further correspondence. At the end of this phase, the Commission issues its letter of findings. The Member State has the right to ask for the matter to be reviewed by the Conciliation Body. This body will review the case and seek written and oral observations from each party. It will make its recommendations and the Commission will consider these before arriving at its final definitive decision. Ultimately it is open to each Member State to initiate legal proceedings in the European Court of Justice in relation to the Clearance decision.
In the case of Ireland, the Clearance procedure is currently covering five financial years involving the 2008 to 2012 scheme-years. The total amount of EU funds under audit scrutiny in the process is approximately €7.5 billion. I can assure the Deputy that every effort is being made to ensure that Ireland’s case and the position of Irish farmers is strenuously argued during the process. It should be noted that as the bi-lateral took place on 25 July 2013, there will be further correspondence and discussions between both parties before any conclusion is reached.
I can also reassure the Deputy that every effort is being made to protect the interests of all Irish farmers during the process including the interest of that majority of farmers, who were fully compliant in the declarations they made on an annual basis under the Schemes. This is an extremely serious process. During the years 2002 to 2012, the Commission imposed financial corrections amounting to almost €5 billion on Member States. Ireland’s share of this total amounted to 0.5% of the total amount corrected – one of the lowest percentages among Member States. Under the EU Regulations, the Commission has to right to impose a flat-rate correction of 2%, 5%, 10% or greater depending of its assessment of the risk to the EU Fund involved – a 2% correction on the 2008 – 2012 scheme years would mean a loss of €150m in funding to Ireland. On the other hand, the level of the correction can be based on the assessed risk if the Member State can establish the risk and the Commission are satisfied with the calculations. In such circumstances, if the risk is dealt with by the Member State by collecting the debts arising from the over-payments, the amounts collected is taken into account by the Commission in its final assessment. This is the approach Ireland is following.
Finally, there is comprehensive appeals system in place. The appeal process will initially involve a desk review based on the application and supporting documentation secured by Department’s staff. As I have already mentioned, a series of on the spot farm verifications have begun and will be ramped up in the coming weeks to examine farms on an individual basis. If the applicant is dissatisfied with the outcome of the appeal, he or she can appeal to the independent Appeals Committee, chaired by Mr Padraig Gibbons.
