EU decision to maintain expenditure on CAP ‘a good result for farmers’

THE European Commission’s decision to maintain overall expenditure on the Common Agricultural Policy (CAP) is a good result for Irish farmers, according to economist Professor Alan Matthews.

The Trinity College professor told 250 delegates attending yesterday’s National Rural Development Conference in Athlone that the proposal to reduce the level of Single Farm Payment to Irish farmers by less than 2% in the period 2014-2020 is a satisfactory result, given the political imperative to redistribute funds to the new member states.

He also told the National Rural Network and Teagasc-hosted conference that Ireland was unlikely to maintain its high level of funds for rural development programmes, as the EU plans to give a greater share to weaker member states.

The TCD economist also dismissed fears that moving to a regional system for single farm payment entitlements would undermine Ireland’s ability to meet the Food Harvest 2020 targets.

Prof Matthews said: “Opposition to a regional system is driven more because it produces losers as well as winners in terms of farm income than by its likely effects on production. Entitlement payments are decoupled from production and farmers make their decisions to expand production on the basis of market prices, not their fixed direct payment.

“Ireland has the ability to define regions with varying payment levels per region under the proposed new system. It is important that the farming community are reassured that the criteria used to define regions and the different levels of regional payments are transparent and objective. Any temptation to gerrymander regions should be resisted.”

Prof Matthews also said the proposed greening measures, while costly and controversial, would have to be introduced if agriculture was to maintain its budget. He said the new agri-environment schemes would raise the baseline level of compliance.

Agri-environment payments are only made to farmers who deliver environmental public goods beyond the baseline, he said.

However, an IFA spokesman challenged Prof Matthews’s view that the CAP proposals are good for Ireland. He said his claims at yesterday’s conference do not take account of the impacts the proposals would have on production decisions at farm level.

The IFA is adamant that any future payment system must minimise disruption at farm level and maximise the national productive base. A simplistic flat-rate system which takes no account of varying land types or differing productive capacities will not deliver this.

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