The reallocation of Common Agricultural Policy (CAP) funding, disadvantages commercial farms, many of whom are already struggling with increasing regulatory costs, according the Irish Co-operative Organisation (ICOS).

The ogranisation says the reallocation takes further funding away from those under the greatest pressure to invest further in climate and environmental actions.

ICOS has welcomed the announcement today (Friday, June 25) that an agreement has been reached on the main issues within the CAP reform negotiations.

However the society has said that it is disappointed to see that the agreement includes a minimum 85% internal convergence and a 10% redistributive payment requirement.

CAP deal

Jerry long of ICOS FUNDING
ICOS president Jerry Long

Commenting on the deal, ICOS president Jerry Long stated: “While we are happy to see progress, we are, however, disappointed that the agreement includes a minimum 85% internal convergence and a 10% redistributive payment requirement.

“As such, we reiterate our concern that this significant reallocation of CAP funding disadvantages productive farms, most of which have made extensive investments based on the current payment entitlements, and which are already struggling with increasing costs of regulatory compliance.

“It is commercial dairy, tillage and drystock farmers who are losing out from this agreement, which fails to take into account the cost intensive nature of their operations (incurred by specific demands concerning traceability, hygiene etc.).

“These are the farmers who are driving our export industry, and who are reinvesting in jobs and infrastructure in our rural communities,” he added.

“The CAP payments made to those farmers have a multiplier effect in their community and this decision on reallocation will have knock-on economic implications on our rural economies.

Clarity sought

ICOS says it’s now awaiting clarity as to whether, in an Irish context, the implementation of 85% internal convergence covers the 10% redistributive payment requirement, or whether further measures will be required.

Long continued: “Furthermore, while the 25% ringfencing of eco schemes, which looks to be included within the agreement is unsurprising, the level of flexibility for unspent funds is.

“Despite the extent of the unknowns in the content or operation of these schemes, a very minimum degree of flexibility will be possible to manage unspent funds, with a floor of 20% set for the first two years and just 2% flexibility possible from thereon.”

ICOS has stressed that this will not ease fears that funding will be lost from the CAP as a result.

The society has said that it is of “absolute importance” that these schemes are accessible and practical to all farmers, to avoid a situation of lost funds.

“What we do welcome within the agreement is the flexibility introduced within the text regarding GAEC 9 [Good Agricultural and Environmental Conditions], an environmental requirement regarding a minimum share of agricultural land to be devoted to non-productive features.

“[We welcome] the recognition it provides for permanent grassland, which we expect and hope to be applicable in an Irish context,” Long concluded.