I thank the Minister for his attendance. The decision last week by the European Commission not to approve the plans of the Department of Agriculture, Food and Rural Development to adopt a particular area based payment to replace headage payments could have far-reaching consequences for many Irish farmers.
In the Programme for Prosperity and Fairness a guarantee was given to the farm organisations that farmers would not lose financially from this major switch from payment based on animals to payment based on area. It now appears that the EU Commission seeks total decoupling of headage payments from animals to a per hectare basis. I have no problem with an area based payment but it must reflect the size of headage payments already received by farmers.
This is of particular reference to the huge cohort of farmers who qualify for extensification and are in the rural environment protection scheme. This group already farms to a regime of low stocking density but if area payments are structured in a manner that will only suit a farmer with many acres and small livestock numbers, many farmers will lose. If this dilemma cannot be solved, the area based payments will get a bad name.
This is also important for beef producers with high stocking rates, suckler cow farmers and both hill and lowland sheep farmers. Unless the outcome of the change from headage to area based payments is such that a huge cohort of farmers with only reasonable stocking rates can qualify, there will be extensive opposition to the new regime. An area based payment has certain advantages, one being that it will not matter unduly how many cattle or sheep are on the land. That could result in better quality stock being reared.
However, the bottom line is whether farmers will be better off next year under the scheme or whether they will lose money they simply cannot afford. Most people would have no trouble with area based payments. The possibility has been debated for a number of years. However, if it means that the European Commission intends to decouple the payments from headage and link them to area, it is essential that the payments are set at a level whereby most farmers will not lose money.
There is great anxiety on this issue and I know where the Minister's heart lies. An effort was made to overcome the problem. The Minister's largest fight has yet to start, however. Of all the issues that arose in the past three years in rural Ireland, this will be one of the most important. Farmers will not accept a scheme under which they will be obliged to accept less money. Given that fact, there is an onus on the Government to convince the European Union that Irish farmers cannot be permitted to lose the moneys to which they were previously entitled.