New EU accession to lower single farm payment
Irish farmers are on course to get a total of €1.322 billion, when the final decoupled Dairy Premium is included in 2006.
But reductions of 6% kick in immediately when the first Single Farm Payment is made (fifteen and a half months from now, at the earliest). Modulation takes 3% (rising to 4% in 2006 and 5% in 2007) in order to fund rural development measures.
The modulation on the first €5,000 of their Single Payment will be refunded to farmers.
At least 3% - the maximum allowable by the EU regulations - will be taken off payments for the establishment of a National Reserve. This money will be given back in the form of Single Payment entitlements to certain categories of farmers such as new entrants to agriculture and farmers who invested in their farming enterprises.
Farmers fear that the Single Farm Payment will come under pressure from EU taxpayers who think that it represents easy money for farmers.
But the only likely early pressure on the payments will come from the EU accession of Bulgaria and Romania.
The cost of this phase of EU enlargement has not been factored into the CAP budget.
Meanwhile, how modulation funds will be spent and the SFP National Reserve distributed in Ireland is unclear, with farm organisations making differing proposals.
The IFA wants up to €46m per year for suckler farmers to improve quality and breeding, to come from the €23m of modulation deductions from livestock farmers’ Single Farm Payments, plus matching national funding.
IFA Livestock Committee Chairman John Bryan envisaged payment of €50 per ha up to a maximum of 40 hectares, or €2,000 per farm for participation in a five year breed improvement programme co-ordinated through Teagasc, livestock marts and discussion groups.
It would cater for a 10% (at least) replacement rate aimed at R grade or better beef animals.
IFA has also made specific proposals for using the additional modulation deductions from the SFP in the other key sectors of dairying, grain and sheep.
ICMSA has proposed a €10m package for calf and weanling producers, amounting to one quarter of the National Reserve. ICMSA president Pat O’Rourke said ICOS and the Hill Sheep Farmers Association have joined with ICMSA in finalising details of the proposal. He said he was pleased that the Department had confirmed that calf and weanling producers could be accommodated from the National Reserve.
