Irish farmers face fines of €15m to €20m as a result of the controversial land parcel identification (LPIS) review, the Minister for Agriculture, Simon Coveney, has confirmed.
Claims for the claw-back of €5m in EU direct payments have already been issued by the Department of Agriculture, but the admission by Minister Coveney that the final amount could be four times that level is certain to provoke outrage among farmers.
It has also emerged that close to 7,500 farmers, or 6pc of the 130,000 applicants for direct payments, face claw-backs of between 20pc and 50pc of total payments.
Minister Coveney told farmers at the ICMSA annual general meeting in Limerick on Friday that the level of fines could be increased five-fold to €100m by the EU Commission unless the Department continued with the review process.
"Where payments have been made on ineligible land, the Commission wants its money back. This is public money and we have to pay it back," Minister Coveney told 350 dairy farmers at the conference.
"If we don't sort out this problem ourselves, Brussels will come in and solve it for us," he warned.
"That has already happened in other European countries. France has been fined €260m, the UK has been fined €100m and Italy has been fined €180m."
The review, which applies to 950,000 land parcels, must be completed by December 15 and it is understood that at least half of the parcels have been reviewed by officials already.
The hugely controversial process has already resulted in almost 20,000 farmers being informed that they over-claimed in single farm payment and disadvantaged area applications dating back to 2009.
ICMSA president John Comer described the review as "brutally unfair on farmers".
"The Department accepted the land was eligible at the time of application. No other sector would accept being told, four years later, that the regulators have changed their mind," said Mr Comer.
However, Minister Coveney insisted the review would continue.
"The idea that we can ignore this problem simply doesn't work so we need to fix it in as farmer-friendly manner as possible," he said.
He told the meeting that 75pc of farmers were "completely unaffected" by the land parcel review, while another 17-18pc of farmers had over-claimed by between 3pc and 20pc.
"Those farmers had average single farm payments of €11,500, which would result in claw-backs of €400 on average," revealed the Minister.
"Those are manageable figures," he claimed.
He said 6pc of farmers had been found to have over-claims of more than 20pc and, in some cases, as much as 50pc.
"Those are much more difficult situations and we will have to deal with those over time rather than going in to claim it all back in one go," the Minister revealed.
However there appears to be some confusion on this issue, with Department officials saying last night that none of the cases had over-claims of more than 20pc.
Minister Coveney told the ICMSA meeting that the Department aimed to have dealt with 93-94pc of all over-claims by the end of this year, but the remaining 6pc would need a "sensible schedule" to recover the money owed.
The minister warned that unless his Department acted now to recover money claimed on ineligible land, "we face the nightmare scenario where instead of the issue costing 25pc of farmers €15-20m, we end up with every farmer in the country footing a bill for €100m."
For more on the ICMSA conference, see page 2.