Sheep farmers have benefited under the Single Payment Scheme, the old Ewe Premium having being incorporated into SPS entitlements from the inception of the Scheme in 2005. Mindful that the sector required additional, focused support, the Upland Sheep Payment (USP) was introduced, on a once-off basis, in 2009, with payments worth some €7 million. The USP was replaced for the period 2010 to 2014, inclusive, by the Grassland Sheep Scheme, total payments in the period totalling €83 million. Going forward, these GSS payments are being incorporated into the new Basic Payment Scheme, under which the vast majority of sheep farmers will also benefit from convergence in the initial five years of the BPS, beginning in 2015. In tandem to these measures, sizeable numbers of sheep farmers have benefited under the €3 million Sheep Technology Adoption Programme since its inception in 2013 and will continue to benefit into the future.
The Grassland Sheep Scheme is based on Article 68 of the current EU Regulation 73/2009 which governs direct payments in the form of the Single Payment Scheme. As of 1 January 2015 that Regulation is superseded by EU Regulation 1307/2013 and consequently there is no longer any legal basis for the continuation of the Grassland Sheep Scheme in its present form. In developing the shape of the new system of Direct Payments in Ireland, I have been very conscious of the needs of sheep farmers, in particular those who farm on hill and commonage land. In general, sheep farmers hold low value entitlements under the current Single Payment Scheme and will benefit significantly from the model of convergence that is to be applied in Ireland where those with a low Initial Unit Value will see the value of their entitlements increase over the period of the scheme.
When determining the Initial Unit Value of a farmer’s entitlements under the Basic Payment Scheme in 2015, Regulation 1307/2013 gives Member States the option to take into account any payment the farmer received in 2014 under Article 68 schemes such as the Grassland Sheep Scheme. This option is only available where the Member State is not applying voluntary coupled support to the sector concerned under the new CAP.
I am considering applying this provision in Ireland as a means of safeguarding the value of the payments received under the Grassland Sheep Scheme for those farmers concerned. The Grassland Sheep Scheme is the only Article 68 scheme that is being incorporated into the calculation of entitlements under the new Basic Payment Scheme. If such incorporation does not take place the value of such payments would simply remain in the national fund and would be redistributed generally among all farmers who establish entitlements.
The incorporation of the Grassland Sheep Scheme payment into the calculation of a farmer’s Initial Unit Value in 2015 will obviously result in a higher entitlement value for the farmers concerned from the start of the Scheme rather than relying solely on the gradual process of convergence to increase the unit value over the five year period up to 2019. Our analysis confirms that as a result of this provision the group of farmers who receive the Grassland Sheep Scheme will have an immediate financial benefit in 2015 as part of their payment under the Basic Payment Scheme. This is an outline of the approach I intend to take.