Dáil Éireann Debate, Wednesday - 7 October 2015
24. Deputy Éamon Ó Cuív asked the Minister for Agriculture, Food and the Marine the progress made to date in negotiations with the European Union on increasing its market intervention price for milk to reflect production costs; and if he will make a statement on the matter. [34222/15]
View answerProvisions in the CMO indicate that the reference thresholds and by extension reference prices for intervention shall be kept under review by the Commission, taking account of objective criteria, notably developments in production, costs of production and market trends. It also provides that when necessary, the reference thresholds shall be updated in accordance with the ordinary legislative procedure in the light of developments in production and markets. The Commission have been reluctant to engage in such a review, preferring to utilise enhanced supports in other areas. Furthermore, they have made it clear that the legislative procedure under which this would be undertaken would entail an 18 month lead in time. In such circumstances, my preferred approach was to examine the possibility of utilising provisions under “Exceptional Measures”, to introduce flexible instruments, such as a modified or temporary intervention scheme, more quickly, by delegated act.
In early September I presented a paper offering possible solutions to both the EU Commissioner and my EU ministerial colleagues. These were presented on the basis of my belief that they were appropriate for consideration by the Council and as a response to the market issues that had developed and I sought to reach common ground with other Ministers regarding a suite of appropriate solutions.
I welcomed steps previously taken by the Commission but noted that having regard to the acute downturn in global milk prices over the past several months, and the severe impact this is having on farm incomes, that a number of further steps were urgently required. These certainly included utilising the provisions of Article 219 of the CMO Regulation to temporarily increase the threshold prices, with particular reference to skimmed milk powder. As outlined earlier to the house I made calls for numerous other measures in the areas of Aids to Private Storage for cheese, which was introduced by the Commission in September 2014 but discontinued shortly after. In addition I called for the existing aid rates in the PSA schemes for butter and SMP to be reviewed immediately.
Another key request was increasing the advance of the Basic Payment and other elements of Direct Payments Scheme and from 16th October 2015 to 70%, to alleviate cash flow difficulties. In addition to these more immediate concerns I made it clear that from my perspective, it will be necessary to give longer term consideration at EU level to responses to volatility issues.
I am pleased to note that the final decision at Council took significant account of Ireland’s requests. Unfortunately a temporary top-up in the intervention price for SMP did not enjoy the support of all Ministers. However the improved PSA scheme for SMP, which will include longer periods for storage as well as the improved aid rates, the re introduction of PSA for cheese, the provision allowing 70% advance in the single farm payment, the provision of increased funding for promotion and the provision of almost €14m in targeted direct aid for farmers can go some way towards alleviating the worst effects of the current market downturn.
In respect of the direct aid element within the suite of measures mentioned above, I am engaging with stakeholders and will make a decision on the use of this aid in the very near future.
