Farm Ireland

Monday 24 October 2016

Brexit threat to EU farm payments

Published 21/06/2016 | 02:30

Dr Kevin Hanrahan, agricultural economist with Teagasc.
Dr Kevin Hanrahan, agricultural economist with Teagasc.

Farm payments from Europe could be hit if Britain exits the EU, according to one of Teagasc's top economists.

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Kevin Hanrahan said that the Basic Payment scheme that channels €1.2bn into Irish farms annually are likely to be hit if the Brexit referendum is passed in Britain next week.

Despite pleas from the British Prime Minister, David Cameron, for British farmers to vote to stay amid what he called an "overwhelming case when it comes to farming", the majority of farmers appear to be set to vote for a Brexit this Thursday.

Some 58pc of farmers polled at the Cereals event in Lincolnshire last week said they wanted out, even as the Scottish NFU wrote to all its members outlining the fact that 74pc of farmers' income in the region came via the EU's 'cheque in the post'.

"Countries such as Norway only secure the same access to EU markets as we do by paying the same EU membership fees, implementing the same EU rules such as sheep tagging but have no say over the rules. The worst of all worlds," outlined the letter, which was signed off on by no less than six former NFU presidents.

Last week the Vote Leave campaign committed to maintaining farm funding to match current EU levels even if the country votes to leave in the referendum, but only until 2020.

Teagasc's Kevin Hanrahan said that the UK is a net contributor to the European budget in an interview with Irish TV.

"If they were to vote to leave that would have a negative impact on the EU budget and on the budget for agriculture as a consequence, and I think it would have a negative impact on the direct payments of income support levels that the CAP provides to farmers," he said.

"I don't think it would be very dramatic but it would be negative and might mean the share of the EU budget that gets devoted to agriculture gets reduced from 40pc."


However, he also noted that the money that the CAP has propped up farmer incomes had generated "dependency culture" in Irish agriculture.

"One can argue that in the long run they don't help Irish productivity at all but that is not the fault of the European Union, this is what we as a European society have decided to do in terms of supporting agriculture which has looked for support," he said.

An even bigger issue in Mr Hanrahan's opinion is the loss of our biggest ally at the table where decisions are made in Brussels.

"The UK and Ireland have got to know each other around the council table since 1973 and the absence of our key partner in all sorts of negotiations would be the biggest fallout to emerge from a Brexit vote so I think we should be deeply worried that our influence in Brussels would potentially be reduced if the vote on June 23 is to leave," he said.

The ICMSA said that they were "praying that sense and reason will prevail in the privacy of the booth".

"Here is threat that Brexit might initiate a slow unravelling of the Union itself with other Member States backing out of an arrangement that has on balance been a huge benefit to us all," the ICMSA President added in a statement.

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