Dáil Éireann Debate, Thursday - 12 July 2018
1. Deputy Charlie McConalogue asked the Minister for Agriculture, Food and the Marine the actions he is taking at EU level to ensure the proposed budget cuts for the 2021-27 Common Agricultural Policy, CAP, programme are reversed; and if he will make a statement on the matter. [32065/18]
View answerI wish to ask the Minister what actions he is taking at EU level to ensure the proposed budget cuts to the 2021-27 CAP programme are reversed and whether he will update the House about his efforts. As the Minister is aware, this is a source of grave concern to the farming sector both domestically and across Europe. The current budget proposals would see a reduction in Pillar 1 payments of 4% and in Pillar 2 payments of 21%. Every effort and political dedication is required to try to address that and to ensure it does not end up hitting farm income and farmers' pockets domestically. The onus is on the Minister to deliver that at European level. I look forward to hearing his update on that today.
By way of introduction I would point out that in discussing the funding of the Common Agricultural Policy, CAP, we should bear in mind that this funding forms part of a broader EU budget which is negotiated by Finance Ministers and then agreed by the European Council and European Parliament.
The European Commission has proposed, as part of the multi-annual financial framework, MFF, 2021-2027, that funding for the CAP should be set at €365 billion. This would equate to a cut of approximately 5% in the next MFF period of 2021-27.
This MFF proposal must now be negotiated by Finance Ministers and agreed by the European Council and the European Parliament. The intention of the Commission is to reach overall agreement on the MFF before the European Parliament elections in 2019.
The MFF is a critical matter for all member states and its agreement requires unanimity at the EU Council. It is clear there are divergent views among member states on the appropriate level for the budget. While some are prepared to increase contributions, in particular if there are areas of added European value, there are others who equally feel strongly that the current proposals, such as they are, are too costly.
We also have to be aware that in the light of the departure of the UK from the EU, some €12 billion per annum in UK contributions will be removed from the budget. Against this background, agreeing the MFF will be very challenging.
Nonetheless, the proposal published by the European Commission is an initial position only. The final outcome will be determined by negotiations at EU level over the coming period. Achieving Ireland’s priorities in these negotiations will be a key issue for the Government. I believe that European agriculture policies have delivered for Irish farmers and consumers. I want to see support under these programmes continued and Ireland will approach these negotiations with this in mind.
The CAP proposals require more from farmers in terms of environmental standards. I believe that Irish farmers have already made a significant contribution to the environment and are prepared to do more. However, the high production and environmental standards required of EU producers must be properly supported by policies that are appropriately configured and properly funded.
Against this background, I have been working to build consensus among my agriculture colleagues in Europe with regard to maintaining the CAP budget. Recently in Madrid, I agreed a memorandum with five of my European colleagues seeking that CAP funding for 2021-27 would not be subject to cuts and would remain at the current level for the 27 EU member states. Ireland, France, Spain, Portugal, Greece and Finland all signed the memorandum. Support has grown for this proposal and I understand that up to 20 member states have expressed support for this position.
I have also sought to continue this work as part of ongoing bilateral meetings. Since May 2018, my colleague, the Minister of State, Deputy Doyle, and I have met with the EU Agriculture Ministers from Germany, France, Belgium, Denmark, Finland and Hungary, inter alia to support a strong CAP budget after 2020. I have also met Ministers from the Netherlands, Estonia, Belgium, Poland, Luxembourg, and Austria, and my officials engage regularly with counterparts in other member states on this issue.
Ireland needs to work closely with its EU colleagues to build a consensus around the need to reverse the proposed cuts in the CAP. I assure the Deputy that I will continue to do this and to fight for a strong CAP budget in the upcoming negotiations.
There is no doubt but that the decision by Britain to leave the EU poses challenges and is regularly given as a reason and rationale for the CAP budget being reduced. What is not highlighted or made clear is that despite the fact Britain is leaving, the overall MFF will be larger this time than the last time. The MFF proposals show the overall EU budget going from €1,087 billion to €1,279 billion. That is an increase of almost €200 million in the overall MFF. The problem within that is the priority that was given to the CAP programme within that proposed MFF structure, in which the overall CAP allocation has dropped from 38% of the overall budget last time around to 28.5% this time. That represents a political failure to prioritise agriculture as a crucial part of the European budget to ensure it was not reduced. It also represents a real failure at domestic level in respect of the impact it will have on farm incomes, as 75% of net farm incomes are based on CAP payments. It is crucial the Minister works with the European Commissioner for Agriculture and Rural Development, Mr. Phil Hogan, and the Minister's counterparts across other European countries to ensure we grab back our proportion of the overall European budget, and to ensure we do not continue down this slippery slope, which has been presided over in the last number of CAP programmes, where agriculture and its funding have continually been eroded.
I would like to reassure the Deputy and the House we share the same objective in the context of securing an adequate budget. That is challenging because, simply put, it requires unanimity across all member states.
It is not an option for the Commission to spend money it does not have. It cannot, under the legal terms under which the European Union is constituted, operate a deficit. It can only spend moneys that member states agree to contribute. It is very clear where Ireland stands in that context. The Taoiseach made that very clear in the context of his address to the European Parliament and it has been reiterated on numerous occasions since then by the Taoiseach, myself and, in particular, by the Minister for Finance.
In the context of that budget there are competing demands, and the Deputy is aware of those. They include security, migration, youth unemployment, etc. These are all legitimate issues, but what our position has been all along is that they should be funded, but not at the expense of the CAP budget. The only way to square that circle is for member states to increase their contributions, and we are willing to do so, but the requirement for unanimity makes that difficult. Even in the context of the CAP, some member states, responding to Commissioner Hogan's most recent proposals, have said that those cuts do not go far enough.
Our view is that there are increasing challenges in the CAP. Farmers need to be adequately compensated for that and we are working with member states, particularly in the context of the Madrid declaration, and are creating the political awareness for the need for an adequate budget for the CAP.
There are no doubt pressures on the budget. Myself, Deputy Cahill and a delegation from our party were in Brussels this week meeting with the various stakeholders in regard to agricultural issues and the CAP budget. There are undoubtedly pressures but let us not detract from or avoid the fact that the scenario, as of today, is a very dire one for Irish agriculture, given that we are going to see the overall CAP envelope for Ireland reduced by 10.5% from what it was the last time around in terms of the funding that will be coming into this country. That is going to impact to the tune of almost 4% in Pillar 1 and 21% in Pillar 2. That is a dire and very concerning vista for farm families across the country, considering how dependent they are on CAP payment income. As I indicated, it comprises 75% of farm incomes overall. If one takes the sheep sector and the beef sector, 100% of their net income is from CAP payments. This move has to be addressed and rebuffed. I understand that it is not easy but there is a significant onus on the Minister, working with Commissioner Hogan, to try to redress the imbalance and the sliding importance being allocated to CAP under the current proposals.
Despite the fact the overall budget has increased by €200 billion, we are seeing CAP being reduced and diminished in terms of its priority status. That, at a political level, has to be a priority and an absolute objective of the Minister, working with the Commissioner, to try to ensure the final deal that is delivered for farmers does not reflect the very concerning one that is on the table at the moment.
I am acutely aware of the magnitude of the task. I am also doing everything that is possible within the confines of the Council of Agriculture Ministers and availing of every opportunity to build alliances with like-minded member states but it is important to acknowledge that there are other member states which take a position that is entirely at variance with that. Given the requirement for unanimity, that is a significant challenge.
This is an issue that is substantially played out in the Council of Finance Ministers and at European Council level but I remain optimistic. Given what Commissioner Hogan said, these are opening proposals, unpalatable though they are and reflecting for us, in the context of Pillar 1 and Pillar 2, more than €90 million in cuts, which is a significant challenge. We continue to work to try to achieve the best possible outcome.
