5% cut in CAP budget on the table in EU talks

The EU proposed yesterday to cut funding for the Common Agricultural Policy by 5%, but some in Brussels warned the new budget plan could cut farm income supports for 2021-27 by 8.5%, and rural development measures 17.5%.

5% cut in CAP budget on the table in EU talks

By Stephen Cadogan

The EU proposed yesterday to cut funding for the Common Agricultural Policy by 5%, but some in Brussels warned the new budget plan could cut farm income supports for 2021-27 by 8.5%, and rural development measures 17.5%.

Even though EU Commission President Jean-Claude Juncker and Budget Commissioner Günther Oettinger proposed to break through the old 1% of national income cap on member states’ contributions, they want spending cuts in major EU programmes, mostly in farm subsidies and regional funds, in order to fill the €13 billion per year hole in funding from the UK, left by Brexit.

Mr Juncker called for agreement on the Budget before the European Parliament elections in May, 2019. He said, “The new budget is an opportunity to shape our future as a new, ambitious Union of 27 bound together by solidarity. With today’s proposal we have put forward a pragmatic plan for how to do more with less.”

European Commissioner for Agriculture and Rural Development Phil Hogan said, “Our proposal for the long term EU Budget maintains a strong, well-funded CAP, and a fair deal for European farmers and rural areas”.

Mairead McGuinness, MEP and first Vice-President of the European Parliament, said the Commission has made its opening budget proposal, but it is not the final position, and the debate will now fully begin in member states and the European Parliament, which co-decide the outcome.

She said the Commission’s proposed CAP and cohesion budget cuts are unacceptable, and must be opposed by member states.

“The proposal for a cut of 4% in direct payments in older member states would result in a direct cut to farm incomes. And the large cut proposed for rural development financing, over 15%, would hit environmental schemes, on-farm investment and LEADER.”

IFA President Joe Healy said Taoiseach Leo Varadkar has a big political challenge on his hands, and an increased CAP budget for Irish farmers has to be a red line issue for him in the negotiations.

ICMSA President Pat McCormack said the CAP cuts called for would have a disproportionately damaging effect in rural Ireland through a multiplier effect when payments go through farm families and into the wider rural economy.

Co-ops, represented by ICOS President Martin Keane, said a proposed 5.3% cut to CAP spending, while increasing funding in new areas such as security and defence, would devastate Irish farmers’ incomes, and the rural economy. He called on the Irish Government and MEPs to support the agri-food sector and get increased CAp funding.

ICSA president Patrick Kent said the suggested 5% cut in CAP funding is very worrying for Irish farmers. He said all options must be explored, including national co-financing of direct payments.

“The focus should really be on more efficient use of EU resources. A cut in CAP funding simply cannot be absorbed by Irish farmers.”

it wasn’t all bad news for farmers from Brussels this week, with the EU and the Mercosur countries ending free trade talks without setting a new date for a next round of negotiations.

In the talks, access to EU markets for 99,000 tonnes per year of South American beef is believed to be on the table, which would mean a major setback for the Irish beef industry if agreed.

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