Farm Ireland

Monday 23 April 2018

Declan O'Brien: Poor prospects for Christmas cheer on Pillar II

Declan O'Brien

Declan O'Brien

FARM organisations and Minister Simon Coveney look to be on a collision course regarding the level of co-funding for the next CAP Pillar II programme.

While the IFA, ICMSA and ICSA have all insisted that nothing short of 50:50 co-funding will be acceptable, the Minister strongly hinted in Limerick last Friday that this will not be a runner.

Indeed, he appeared to suggest the level of co-funding will be significantly lower than that being sought by the farm bodies. This is not good news for farmers or for the rural economy.

For the uninitiated, Pillar II of CAP is co-funded by the EU and the national exchequer. However, the Government contribution can vary from 47pc down to 15pc.

At a Government co-funding rate of 47pc, which in reality is the best possible scenario, the total budget for the Pillar II programme would be around €590m.

Of this total, €313m would be supplied by the EU, with the remaining €280m coming from the national exchequer.

But speaking to reporters at the ICMSA annual general meeting in Limerick last Friday, Minister Coveney claimed that the overall spend on Pillar II at the moment was €405m. This seems low to me but I presume the Minister has the correct figures.

Either way, he appeared to suggest that a sizeable increase beyond this level was extremely unlikely given the current state of the national finances.

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More worrying for farmers was the Minister's talk of co-funding rates of 15pc and 25pc for some Pillar II schemes.

Minister Coveney has confirmed that the final budget for Pillar II, and the make-up of the overall rural development package, will be published this side of Christmas -- the scheme proposals were sent to the Department of Public Expenditure and Reform for approval last week.

However, there was no hint of seasonal greetings from the IFA on the matter yesterday when the association's president John Bryan said the decisions on the CAP Rural Development programme over the next three weeks will be a real test of their commitment to rural Ireland for the next seven years.

"The Rural Development Plan (RDP) is an opportunity for the Government to deliver significant funding into the rural economy. Foreign direct investment is concentrated in urban areas and a fully-funded RDP can place rural Ireland at the centre of its recovery strategy of increasing jobs and economic activity in all parts of the country," Mr Bryan said.

This is very true, but one wonders if the farm organisations are also feeling the heat on Pillar II. After all, farmers who demanded a major redistribution of the single farm payment budget were fobbed off with talk of what they would get from Pillar II.

It now appears that there will be no Ho, Ho, Ho from Kildare Street this Christmas.

Irish Independent