A meeting of the EU's General Affairs Council has predicted that cuts to the CAP budget are now inevitable, according to Ireland East MEP, Mairead McGuinness.
Pressure from the Britain, Denmark, Sweden, Netherlands, Finland and Austria to cut €100bn from the overall EU budget stems from the belief that austerity measures at home must be matched by an equal austerity at EU level, according to Ms McGuinness.
"If they prevail, there will be negative consequences for farm incomes, the food industry and rural communities," she warned.
She said following a series of bilateral meetings with member states, the Cypriot presidency has drafted a paper outlining serious disagreements between member states on the future budget of the EU.
"The Council concluded that the overall level of the seven-year budget as proposed by the Commission, will have to be adjusted downwards and that reductions in the CAP budget must come from direct payments and rural development headings," she said.
The Council is also calling for greater flexibility between the direct payment and rural development pillars, with monies transferred in either direction.
Meanwhile, Ireland West MEP, Marina Harkin has lodged a formal complaint this week with the European Ombudsman over the decision by the EU Agricultural Commissioner Dacian Ciolos to approve retrospective stocking levels as part of the qualifying criteria for the Disadvantaged Areas Scheme.
Ms Harkin accused Commissioner Ciolos of approving "retrospective changes drafted in such a way as to deliberately deprive up to 10,000 Irish farmers of any possible opportunity to continue in the scheme."
She added that all farmers should have reasonable entitlement to legitimate expectation and legal certainty in EU schemes.