Plan for flat-rate payment per hectare will hit farmers receiving higher payments, according to farming groups

Mention reform of the Common Agricultural Policy and wait for the stifled yawns. True, it’s not as exciting as bankers’ pay but, unlike the bankers’ bonuses, this policy will spread some ¤1.5 billion around the State every year for the next seven years.

About ¤1.2 billion of this will come from the single farm payment, often known as “the cheque in the post”. This payment is made to farmers to guarantee a stable and safe food supply, and reward good environmental and welfare practices.

Agri-food economist Ciaran Fitzgerald says the payments are particularly valuable in rural areas because much of the money is spent locally. “This is not just an agri-industry issue – this is a national issue.”

His point is echoed by Pat Ryan of the Liffey Mills animal feed group. He says the date the single farm payment falls due, is “second only to a good harvest” as farmers pay bills and do business.

“The money is not pocketed. It goes on sustaining the type of enterprises this country is crying out for – haulage companies, garages, vets.”

Next week, EU agriculture ministers will meet to try to reach agreement on how those direct payments will be distributed within member states. The European Commission wants to move the payment system from a model based on how much farmers produced in the early part of the last decade to one based on a flat payment per hectare, irrespective of how productive the farmers are.

It would like to see a minimum payment per hectare to lift those farmers on very low payments. But the money has to come from somewhere, and it looks like it will be taken from farmers on high payments.

This is where it gets controversial. The main farm groups believe the Commission plans will result in taking income from the hardest-working farmers and giving it to farmers who are doing very little.

According to the Department of Agriculture, people on the highest payments have about double the stocking rates of those on lower payments.

According to IFA chief economist Rowena Dwyer, the proposals could lead to a drop of 27 per cent in the single farm payment for the 60,000 farmers who receive payments of more than ¤250 per hectare.

IFA general secretary Pat Smith says it would be like someone’s boss taking 27 per cent of their income and giving it to colleagues, regardless of their performance.

Equitable share-out
ICMSA president John Comer says the plans will hurt family farms, which are the bedrock of the agri-food sector. He believes the move to a flat payment for all will encourage “cheque book farming” because people will be rewarded for doing very little while harder working farmers will lose income.

This will affect production and work against the Government’s Food Harvest 2020 plan for significantly increasing farming output, he says.