IFA President Joe Healy welcomed the decision of the European Parliament Budget Committee to back an increase in the next CAP Budget to maintain the real value of payments.
“It is significant that the Budget Committee has supported a CAP Budget that maintains existing funding, but also provides for inflation. This is a clear signal to the Irish Government & the EU Commissioner Phil Hogan to leverage this outcome across Member States and push for higher contributions to make this a reality.”
“Farmers need an increase in the CAP Budget to at least keep pace with inflation and to support farmers for any additional measures they will be expected to take on as part of the new CAP. It would allow farmers to continue to produce top quality food at affordable prices while enhancing the environment and maintaining waterways.”
The proposed EU Budget outlined in May put forward higher contributions from the remaining 27 Member States. Yet, the proposal was to cut the CAP budget by 5% before inflation which, based on the EU proxy inflation rate, could see the real impact of the cut being over 15%.
“This would a devastating effect on the low-income farming sectors who are very dependent on CAP payments. Average farm incomes are 40% of average earnings in other sectors across the EU. On cattle rearing and sheep farms, direct payments account for up to 115% of average farm and income.”
Despite this and falling farm incomes, the percentage of the EU Budget going to CAP has reduced from close to 60% in the early 1990s to 30% today.