€85 million in direct payments ‘lost yearly’ to non-farming landowners

Data shows that Irish farmers are losing approximately €85 million in direct support payments due to higher land rental costs, according to the Irish Creamery Milk Suppliers’ Association (ICMSA).

President of the ICMSA Pat McCormack revealed this figure while commenting on the publication of a study on the leakage of direct payments from active farmers to non-active landowners.

‘Diverted’

McCormack said the study highlighted the problems that saw “very substantial” amounts of direct payments to farmers effectively being diverted to non-farming landowners through inflated land rents.

“The Common Agricultural Policy (CAP) and direct payments were specifically designed to support active farmers farming the land and the conclusion that €85 million of that support is being lost to non-farming landowners confirms a major flaw in the direct payment system.”

The president said that the figure of €85 million could well be an underestimate, in the view of his organisation.

“We also think that the CAP post-2020 regime should be unapologetically designed to suit the active farmer and to ensure that that sector can receive as much of his/her direct payment as possible; and that it is not simply passed on to non-farmers through higher land rental costs,” said McCormack.

This is not just an Irish problem, the president added, noting that the study identified losses in the region of €10 billion per annum across the EU.

Regulations

Technical regulations following the final CAP post-2020 conclusions must address this matter and ensure that the direct payment budget is put in the hands of active producers – and not merely diverted to non-farming landowners, as is happening under the current regime, he stressed.

“With that in mind, the structure of entitlements, the system of trading entitlements and the introduction of a regime to assist farmers who lose rented/leased land and thus possibly direct payment support must be considered.

“There has long been talk about targeting direct payments to active farmers, but – to date – the system has just not delivered in this regard.

Irish farmers cannot afford to be leaking €85 million in direct payments out of agriculture and over to non-farming landowners.

“A clear problem has been identified by this report; it’s up to the EU Commission and the Department of Agriculture to analyse this matter and make the necessary changes to the regime that will eliminate this diversion of direct supports from active farmers to non-active landowners,” McCormack concluded.