Farm organisations react to latest CAP proposals

On Wednesday of this week (May 27), the European Commission issued a revised set of proposals for the EU Budget – the Multiannual Financial Framework (MFF) – for 2021 to 2027.

The new set of reforms are designed to boost the economic recovery in Europe in the wake of the Covid-19 pandemic. Included in these reforms is a revised funding allocation for the Common Agricultural Policy (CAP).

Although the funding allocated to CAP in these proposals is an improvement from what was tabled by the European Council in February, the new proposed CAP funding is valued at some 9% less (without covering inflation) than what was allocated for the current CAP (2014-2020), even if you account for the absence of the UK.

The proposed new MFF would see €348.3 billion going towards CAP, according to the proposal document, a figure expressed in terms of ‘constant’ 2018 prices, i.e, price increases through inflation after 2018 are not included in the allocation. If expressed in ‘current’ 2020 prices, the figure works out at €391 billion, though again, this figure does not cover future inflation.

In constant 2018 prices, the figure allocated to the current CAP (2014-2020) stood at €382.5 billion, after excluding payments to the UK.

With all this in mind, how have farm organisations responded?

IFA

Tim Cullinan, the president of the Irish Farmers’ Association (IFA), argued that the incoming government “must stand firm” as the commission’s proposals “fall well short” of covering inflation and extra requirements placed on farmers.

“Today’s proposals for the next CAP budget are an improvement, but they still represent a cut of 9% in real terms [accounting for inflation] from the current period [2014-2020]. Farmers cannot afford a cut. The proposal must be increased to cover inflation,” Cullinan argued.

The next EU Council summit, set for June 18 and 19, will be the first real test of our new government, if we have one in place. Whoever the Taoiseach is will have to insist on a bigger budget to provide farmers with a viable income.

The IFA president added: “To put it bluntly, the commission needs a reality check. It cannot impose more costs and output reductions, which it set out in last week’s ‘Farm to Fork’ and ‘Biodiversity’ strategies, and at the same time cut the CAP budget in real terms.

“We recognise the importance of re-booting the economies across Europe, but the allocation to farming is not enough,” Cullinan stressed.

ICMSA

The Irish Creamery Milk Suppliers’ Association (ICMSA) said that the “harsh truth” is that farmers are still facing a cut in direct payments when the reformed CAP comes into effect, if the proposals tabled this week are agreed by European leaders.

“Given the circumstances farmers find themselves in at present…and the just-published Farm to Fork Strategy bringing with it new demands for higher standards, farmers will be astounded by the EU to proceed with what is, in real terms, a very substantial cut to CAP and to direct payments,” said Pat McCormack, the association’s president.

The cuts that this package will involve, when combined with the complete failure of the EU to ensure farmers receive a fair price…provide a very revealing picture of how farming and food production is actually viewed by the EU.

“The very minimum that farmers were entitled to expect was a CAP that would maintain payments at existing levels to provide farmers with some level of confidence to invest in their farm businesses and stimulate badly-needed investment in the rural economy,” McCormack added.

“Our rural TDs across all political groupings need to take a stand on this matter and insist that the Government reject this completely inadequate proposal,” the ICMSA president insisted.

ICSA

Edmond Phelan, the president of the Irish Cattle and Sheep Farmers’ Association (ICSA), said that the proposals are “all the more frustrating given that it comes hot on the heels of the launch of the EU’s Farm to Fork and Biodiversity strategies which will place significant additional demands on farmers”.

“It is incredulous that this should be followed by the news that no additional funding is to be provided for this, and that farmers will actually have to rely on less,” Phelan argued.

This proposed budget offers no real prospects for a sector that has been rocked by the crisis brought about by Covid-19. It does not ensure farming families will continue to have the ability to produce high-quality food at a reasonable price.

“As these proposals have yet to be set in stone, we need to see a determined effort on the part of the Government to fight for a CAP budget that can sustain the ever-increasing ambition of the programme,” the ICSA president concluded.

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