The negotiations on the EU's Multiannual Financial Framework (MFF) for the period 2021-2027 - which will be decided by Ministers for Finance and Heads of Government - are ongoing, and are running in parallel with the negotiations on the post-2020 Common Agricultural Policy (CAP). Agreement on the budgetary allocations is not expected to be achieved until Autumn 2019.
I have been very firm in my view that I do not accept the proposed 5% cut to the CAP budget post-2020, and there is consensus on this issue amongst my Member State colleagues. I have been strongly advocating for the CAP budget to be restored to current levels for the EU 27 for the next programming period, and I will continue to work towards achieving this objective until agreement on the MFF post-2020 proposals has been reached.
Pillar I direct payments are a core feature of the CAP, and are fully funded by the EU budget. The cut in Pillar I funding for Ireland based on the current MFF proposals is approximately €47m per annum. These payments cannot be co-financed by Member States. With regard to the maximum co-financing rate for Pillar 2, the Commission proposals outline a maximum EAFRD contribution rate of 43%, down from the current rate of 53%. Until the MFF proposals are agreed, it will not be clear what the precise financial implications for the CAP schemes will be. Based on the proposals, Commissioner Hogan has indicated previously that some €47 million per annum in additional national funding would be required for Ireland to make up the proposed shortfall under Pillar II funding, and my Department would concur with that estimate.
