Farm Ireland

Monday 25 March 2019

Swift agreement on EU budget needed to ensure continuity in farm payments - Hogan

European Commissioner Phil Hogan. Photo: Reuters
European Commissioner Phil Hogan. Photo: Reuters
Ciaran Moran

Ciaran Moran

Agriculture and Rural Development Commissioner Phil Hogan has said that a swift agreement on the EU's budget post-2020 is essential to ensure continuity in farm payments.

It comes as Agriculture MEPs announced that they will only vote on the legislation for the next Common Agricultural Policy (CAP) in April, which means the next European Parliament will have the final say on the policy overhaul.

Under plans for the EU’s budget (MFF) for 2021-2027, farmers would receive around €232 billion in direct support, a drop of more than €30 billion from the current seven-year budget.

In a recent speech to European Economic and Social Committee discussion on CAP, Hogan said the Commission's proposal was made in an extremely challenging budgetary context, taking into account the loss of an important net contributor due to Brexit as well as the need to address new challenges, such as security and migration.

"Within that context we feel the Commission made a fair and reasonable proposal, maintaining a strong budget for agriculture - the amount of €365 billion for the CAP means that 96 cent out of every euro paid to farmers for 2014 to 2020 is protected going forward towards 2027.

"This reduction is complemented with a proposal to achieve greater equity in direct payments per hectare, notably through convergence, degressivity and capping, and a redistributive payment. 

"This means that small and medium-sized farmers would largely escape any reductions in payments," he said.

Hogan said the reduction of Rural Development programmes can be compensated by Member States or by transfers from Pillar One.

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"I want to emphasise the importance of a swift agreement on the MFF, to ensure a seamless transition between the current and the new budget,

to provide predictability and continuity of funding and to ensure that EU funds start delivering results on the ground as soon as possible," he said.

At the December European Council, European Leaders endorsed the aim of reaching political agreement on the budget by autumn 2019.

"This will be essential to pave the way for finalising the CAP negotiations and to ensure a smooth transition to the next period," Hogan said.

The last EU budget negotiations went down to the wire, taking two and a half years of haggling. Member States and the European Parliament are set for tough talks, with hopes of an agreement in the autumn.

Germany and France, the biggest paymasters putting in 19pc and 17pc of the budget respectively, are ready to plug some of the Brexit gap if the budget suits their new priorities.

Paris, for example, wants to see some budget allocated to the 19-member euro zone as part of plans to bolster the EU single currency. With its traditionally strong farm lobby, France is also likely to defend farmers from pressure to cut back on EU subsidies.

Ireland's position on the budget has been so far unequivocal. From the Taoiseach to the Minister for Finance and Minister Creed, Ireland wants to see the budget restored to the previous level, taking into account that there will no longer be the UK contribution.

Some 80pc of the EU funds for Ireland come through the CAP.

For every euro Ireland puts into EU funds we get back a higher amount through CAP.

However, the Commission's proposals are based on a certain increase in member state contributions and not all member states are willing to make a contribution.

The Dutch led the charge for rich northern states unwilling to step into the Brexit breach: “A smaller EU ... should have a smaller budget,” Prime Minister Mark Rutte has said.

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