The programme for Government agreed between Fine Gael and a host of Independent TD’s has set out to reduce the highest CAP payments made to farmers.

The new Government says it will ensure that the budget for Common Agricultural Policy (CAP) implementation is protected, with €12.5billion to be ‘fairly’ distributed amongst farmers across the timeframe of the new CAP.

In the context of the EU mid-term review of the CAP, we will propose a lowering of the cap on Basic Payments, from €150,000 to €100,000.

In 2014, some 209 farmers received payments of in excess of €100,000.

Current system

Under the latest reform of the CAP which took place in 2013, the Single Payment Scheme was replaced by the Basic Payment Scheme.

Ireland implemented the ‘Internal Convergence Model’ of redistribution of funds between farmers. This model, while initially retaining the link with current payments under the Single Payment Scheme, gradually moves all farmers towards a national average value over the five years of the new scheme but does not arrive at a ‘flat-rate’ by 2019.

The purpose of this model is to achieve a phased redistribution of payments between those who currently hold high value entitlements and those who hold low value entitlements.

Farmers who hold entitlements with a unit value below 90% of the national average value will be increased by one-third of the difference between their starting value and the 90% level over the five years of the scheme.

Under the current regime by 2019, all entitlements will have a minimum value of 60% of the national average value. This will be approximately €150 per hectare.

No farmer will receive a payment under the Basic Payment Scheme of over €150,000 per annum.

By 2019 no farmer will receive a payment per hectare (Basic Payment plus Greening payment) greater than €700.00.