CAP compromise rejected by farmers
Farm leaders said the plans tabled by Commissioner Franz Fischler would devastate the dairy sector and the incomes of 26,000 milk suppliers.
They calculated that proposals for a 32% cut in butter prices and a 16% cut in skim milk powder prices would result in a 25% milk price cut.
Tough negotiations on the complex detail of the package went into the night in a bid to secure a deal ahead of today's EU heads of government meeting in Greece.
Irish agri-industry and farm leaders urged Agriculture and Food Minister Joe Walsh to hold out for a satisfactory outcome for the country's 140,000 livestock, dairy and cereal farmers.
Minister Walsh said the proposals are far from satisfactory.
While they represent significant movement, the cuts on the dairy side are too drastic and go beyond what was agreed in Agenda 2000.
Dr Fischler's proposals represent the most radical shake-up in the 40 year history of the CAP, which accounts for 45 billion of EU funds every year.
Dr Fischler initially sought fully to break the link between subsidies and production (so-called decoupling) and replace it with a single payment.
He has shifted his position to a proposal that only 70% of beef production should be decoupled, and individual countries would have autonomy in operating schemes for the remaining subsidies.
The milk sector proposals, however, provoked the most anger from the Irish farm lobby yesterday, with IFA president John Dillon saying they are a devastating blow to dairy farm incomes, already under serious pressure.
Irish dairy farmers would suffer a net price cut of over 10p a gallon which would mean a direct income cut of over 150 million per year.
Mr Dillon said some progress had been made in the livestock sector on the operation of decoupling, where for the first time there was a recognition of the need for higher support for active farmers.
John Tyrrell, director general, Irish Co-operative Organisation Society (ICOS), the umbrella body for the country's co-ops, said the compromise would be very damaging for the milk sector.
The overall conclusion was the combined net loss for Ireland could be close to €183m per year, when fully implemented in 2008.
ICMSA president Pat O'Rourke said the compromise is worse than the original proposals.
It could cut dairy farmers' incomes by over 55% when fully operational in 2008 and is completely unacceptable.
The income of an average dairy farmer in Ireland in 2002 was €26,000, but it will drop to €11,500 in 2008 if the latest package is accepted.
