Farm incomes facing potential €200m hit
Earnings could fall by up to 10pc as EU opts for performance-based approach on payments
Irish farm income could fall by €200m a year depending on the exact design of the future Common Agricultural Policy (CAP).
An EU Commission impact analysis accompanying last week’s CAP proposals put the drop in European farm incomes over the coming years at between 2pc and 10pc.
This equates in an Irish context to a drop of between €40m and €200m per annum given that the 2016 Teagasc National Farm Survey put overall annual income in the farm sector at more than €2bn (85,000 farmers at an average income of €24,000 per year).
The EU assessment follows on from an IFA analysis which claimed that last week’s CAP proposals will cost the Irish farm sector up to €1bn or around €160m a year between 2021 and 2027.
The CAP proposals announced by Agriculture Commissioner Phil Hogan last Friday will see €365bn spent on European farming between 2021 and 2027.
This amounts to a 5pc cut in EU farm spending, which is in line with the announcement made by Budget Commissioner Günther Oettinger earlier this year.
However, critics say the overall budget cut will be far greater than the 5pc the Commission has estimated due to rising inflation and because the Commission has used 2020 as a comparison rather than the previous 2014-20 budget period.
This week it emerged that Ireland has teamed up with five other EU countries to resist the CAP cuts.