UP TO 80 per cent of Irish farmers will see a reduction in their direct farm payments under proposals from the European Commission to reform the Common Agricultural Policy (Cap).
A larger proportion of the money paid to farmers is to be diverted into rural development schemes, largely aimed at environmental protection, under the Cap "health check" presented by EU agriculture commissioner Mariann Fischer Boel to the agriculture committee of the European Parliament yesterday.
Farmers receiving more than €5,000 in farm payments annually will see the amount of that payment diverted to rural development programmes rise from the current rate of 5 per cent to 13 per cent by 2013. Areas which would benefit from the diverted funds would include the management of water, renewable energy resources, biodiversity, and climate change, however Ms Fischer Boel has yet to specify how the money will be used.
The health check is the EU's interim review of the Cap reforms originally agreed in 2003 and will determine the future of the Cap up to 2013.
While the majority of Irish farmers will be affected by siphoning off of their direct payments to environmental projects, it is the larger farmers in the EU who will take the greatest hit, with those receiving more than €300,000 in subsidies losing 22 per cent to rural development schemes. Only 1.5 per cent of Irish farmers get more than €50,000 in subsidies annually.
Measures more likely to find favour with Irish farmers are the increase in the milk quotas and the abolition of set-aside land.
Milk quotas will be increased by 5 per cent (1 per cent per year) by 2013 to pave the way for the elimination of the quota by 2015.
The set-aside rule, which requires farmers to leave 10 percent of land fallow each year to give soil a chance to recover between crops, will also be eliminated with farmers having only to leave small "buffer strips" of fallow land for the benefit of wildlife.
Fine Gael MEP Mairead McGuinness said the changes to the subsidy system would be unpopular with farmers, particularly because no details had been give on what projects would qualify as rural development under the environmental criteria listed by Ms Fischer Boel.
"The idea of taking from some farmers to give to other farmers is very unpopular, particularly when it is not clear what enterprises are going to be getting that money.
"The difficulty I would have is that because we don't have specifics it is very had to analyse if it's a good or a bad move."
The health check report was also overshadowed by the World Trade Organisation (WTO) agriculture talks, Ms McGuinness said.
"It is very clear that the outcome of the world trade agreement will be much more significant to EU agriculture than anything that might happen with the health check on Cap."
Ms Fischer Boel's proposals will now be negotiated with the parliament and agriculture ministers in the EU with a view to reaching agreement by December. A No vote against the Lisbon treaty would weaken and diminish Ireland's hand in these negotiations Fianna Fail MEP Liam Aylward said.
"The bottom line here is that Ireland is in a much stronger position to deal with issues of concern to Irish farmers in the context of the Cap Health check 2008 - 2013, on the back of a Yes vote." Mr Aylward said he welcomed the changes to the milk quota but did not support the cuts to the single farm payment.