Compensation under Milk Reduction Scheme cut for Phase 2 applicants

Ciaran Moran

Ciaran Moran

Farmers applying to Phase 2 of the Scheme will receive less than those who applied under Phase 1

Dairy farmers who successfully apply to Phase 2 of the EU’s Voluntary Supply Management Scheme will receive less than farmers in Phase 1.

The Department of Agriculture, Food and the Marine today announced the results of Phase 2 of the scheme for the dairy sector.

This phase of the scheme covers reductions in the three-month period commencing November 1 to January 31 2017.

There were 556 applications from Irish dairy farmers for this phase, with a total proposed reduction of approximately 6.4m litres. Across the EU there were applications for 98m litres of reductions.

Ireland had the highest rate of take up of the scheme with some 4,500 dairy farmers applying to take part before the deadline last month.

The significant subscription rate for Phase 1 of the scheme has meant that less than only 1% of the overall budget is available for this Phase 2.

The Department said that this was not enough to cover the volume of applications received and so the European Commission has applied a coefficient of just under 0.125 to all applications.

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This means that applicants for the scheme will only be compensated for 12.5% of the amount for which they applied.

An example of how this will be applied is if someone applied for 10,000 litres reduction in output, they will be compensated for reducing by 1,250 litres or 12.5% of this reduction.

The Department says they may reduce by the full amount if they so wish but will not be compensated for anything above 12.5% of this amount.

It also said that it would be in touch with the applicants for the scheme in the coming days to inform them of this result and authorising them to proceed with their reduction if they so wish.

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