Government must secure a fully funded Cap budget
OPINION:IFA against any regionalisation or flattening of Single Farm Payment
The next six months will be a significant period for Irish agriculture. Decisions are likely to be made during the Irish Presidency of the EU, which will have far-reaching implications for the future of the farming and food sector. They will also have a major bearing on its ability to reach the growth targets set down in the Government’s Food Harvest 2020 strategy to develop agriculture.
The expectation is that we will see a deal reached on the EU budget by the heads of Government meeting next month.
The focus of Taoiseach Enda Kenny and the Minister for Agriculture Simon Coveney must be to secure a fully funded Cap budget from 2014 to 2020. This outcome would be very much in line with the stated aim of the Irish Presidency to promote jobs and growth.
IFA will maintain the maximum pressure to ensure the Single Farm Payment and the Pillar 11 measures are retained in full. Both are vital supports for farm income, and in the case of the Rural Development Programme, the Government must continue to provide 50:50 co-financing.
On the distribution, our position is clear: IFA is fully opposed to flattening and regionalisation of the Single Farm Payment, as this will cause major disruption of payments at farm level and undermine production in all parts of the country.
Any future payment system must support active farmers, and underpin production. To maintain the viability of farm businesses, there must be a limit to the total loss incurred by an individual farmer, and any money that is redistributed due to the internal convergence of payments must be directed towards productive farmers. As farmers face into a new year, they are also concerned about the price/cost squeeze.
Input costs are 35 per cent above their 2005 levels, which is in marked contrast to the general level of inflation which is 12 per cent. The significant rises in feed, fertiliser and fuel have not been reflected in the price passed back to producers.
Across all commodities, the power of the multiples continues to put downward pressure on the price paid to producers, yet their margins are maintained. The Government commitment to a code of practice to regulate retailers is long overdue, and must be progressed by the cabinet as a priority.
Retailers have used their power over producers and suppliers to devise and implement a number of methods, whereby they reduce producer margins, although not directly, by reducing the returns to their suppliers.