I had been speaking about the circumstances of hill sheep farmers, and mentioned our meeting with the Irish Farmers Association last week. One of the very positive proposals then advanced was for an extensification premium for flock owners who qualified on the basis of the stocking rate requirement of less than 1.4 per hectare. I hope this will be addressed in the course of future negotiations and proposals at European level. It proposed an increase in the rural world premium to £10 per ewe, an increased headage payment targeted specifically at hill sheep flock owners, and also proposed the abolition of the 7 per cent stabiliser mechanism worth £44.70 per ewe in additional ewe premium. It had a very good case which it articulated very well to us and I hope it will be acted on by the Government.
The Minister of State set out very clearly the Santer proposals, detailing clearly the net effect of the Agenda 2000 proposals on Irish agriculture. He said:
. I believe that the net effect of the proposals on prices and on premia could be a loss of the order of £125 million a year.
and went on to say:
. it does not include any estimate of the effect of changes in Ireland's receipts under the structural heading where the Commission's proposals, at this stage, are even less developed than their market proposals.
Since Structural Funds have been very important and of enormous benefit to us, I am most concerned about this. Recent departmental replies given to all queries on Structural Funds are to the effect that much of those moneys has already been used up on tourism projects and on other projects concerned with arts, heritage and the Gaeltacht. I want individual Ministers to follow up the matter of Structural funding, ascertaining how farmers in rural areas can be compensated so that, consequent on these proposed changes, no loss will accrue to them.
The incomes of farmers in rural areas will have to be protected and I hope the Minister spells out the way permanent compensation could be made for any price reductions. Any system of compensation will have to be fair and equitable. As a major beef exporter, Ireland depends to a large degree on income from that sector and we are sensitive, therefore, to any changes in EU arrangements.
I hope young farmers, particularly those in the dairy sector, will have an opportunity to avail of quotas. I had a number of meetings with members of Macra na Feirme who stressed the need for access to quotas across the board but particularly in the dairy sector. The current negotiations on access to the market by other countries are a cause of concern to young farmers.
Mr. Raymond Keane of the European Commission Representation in Ireland, stated in a presentation that the conclusion the Commission came to with regard to new entries to the European Union was that five eastern European countries were the best prepared, even though they had some way to go in economic terms. Those countries were Poland, Hungary, the Czech Republic, Estonia and Slovenia. The Commission proposes to open negotiations with these five countries, in addition to Cyprus which was always favoured for access to the EU. I hope that when these negotiations take place, we will have a vibrant European Union.
On the question of funding, the Commission has taken the view that the next financial agreement should cover a seven year period from 2000 to 2006. In that context it is important that the whole question of Structural Funds and Objective One status is examined. If Objective One status is being considered for western and Border regions, it would present a major opportunity to obtain additional funding for severely disadvantaged areas. It is important that the Commission is considering Objective One status, maintaining the overall funding and putting in place a transition arrangement for western and Border regions. The strategy should be to build on the MacSharry reforms in key market areas, particularly in regard to rural structural development policy, and to take account of the environmental dimension.
On the question of rural development policy, many of the difficulties we face as a result of rural depopulation and transport problems could be overcome by examining some of the schemes already in existence. I commend the Minister of State, Deputy Davern, for the small but important changes he made in the Leader programmes. He informed us that community groups, for example, will have to provide only 30 per cent funding rather than the 50 per cent they had to provide in the past. That is a welcome announcement.
In relation to tourism projects, more projects have applied for funding than there is money available. I note that the grant aid will be increased from 20 per cent to 30 per cent. Recognition of own labour as private matching funds will now be included in private projects. These are important issues which will assist the developments currently being made in the Leader programme and I commend the Minister and the Minister of State for negotiating these proposals.
I am glad that matters have improved following the problems experienced in relation to delays in payments of headage and other grants. I welcome the fact that the Minister has more staff at his disposal to deal with this issue which I hope will ensure that these grants will be paid in the coming weeks. I hope also that concerns about future headage payments will be allayed by the Minister giving an assurance that this direct payment will continue.