HARD TO SEE HOW FARMERS CAN DO IT ALL WITH REDUCED CAP FUNDING

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21 JULY 2020

ICSA president Edmond Phelan has said that this morning’s agreement on EU funding was “necessary to provide economic certainty but it is very hard to see how farmers can do all they are being asked in the context of significantly reduced CAP funding.”

“The whole process has been complicated immeasurably by the Covid crisis. The Next Generation EU (NGEU) fund of €750 billion, of which €390 billion is grant aid, is very necessary to underpin EU economic recovery. However, the farming sector is not getting a fair share particularly with the last minute halving of the recovery support for the rural development budget which was meant to be €15 billion and is now coming in at €7.5 billion.”

“I welcome the confirmation of a €5 billion Brexit fund which will be targeted at areas particularly impacted by Brexit and it is essential that the Irish government fights tooth and nail to get a substantial allocation from this given that Irish agriculture is directly in the firing line from Brexit.”

“ICSA is disappointed that the overall EU budget of €1,074 billion for the period 2021-27 is well down on the initial EU Commission proposals in 2018 for a budget of €1,135 billion. Even that figure was a significant cut on the previous budget. The consequence now is that CAP funding will average just under €51 billion per annum in constant 2018 prices (or a total of just over €356 billion for the seven years) compared with a 2021 budget of €55.2 billion. It is inconceivable how farmers are expected to provide so many additional public goods in terms of climate and biodiversity on an ever decreasing funding regime. EU leaders have talked the talk on a Green Deal and the Farm to Fork strategy, but they have not walked the walk on funding it.”

“ICSA believes that the Irish Government is now going to have to stump up more exchequer funds if it is serious about the farming sector, as well as being aggressive about getting a fair share of the NGEU fund. The additional fund for rural development will be worth an additional €300 million and with exchequer co-financing this could put an additional €100 million per annum into a new REPS scheme. ICSA has already argued that the proposal to put €1.5 billion of carbon tax into a REPS type scheme needs to be more ambitious and should be allocated across the period of the Rural Development Programme rather than 10 years as suggested in the programme for government. There is a lot of scope for higher levels of national co-funding of the Rural Development Programme and ICSA will be pushing the new government very hard to deliver on this.”

“Overall, the agreement this morning brings clarity to the EU budget and it means that it is now game on to get a CAP reform agreed. Given the decisions made today, a lot of creative thinking will be required to protect the interests of Irish cattle and sheep farmers,” concluded Mr Phelan.

ENDS