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An extra €194m that was due to be made available to Irish farmers over the next two years has fallen victim to a high-level EU budgetary row.
The European Commission committed to a €750bn “Next Generation EU” COVID-19 recovery fund, on top of its long-term budget, valued in excess of one trillion euro.
Some €7.5bn of the recovery fund was set aside for rural development spending, with Ireland allocated €194m of this.
The European Parliament, made up of MEPs, and the European Council, representing EU member states, struck an agreement last week to frontload these funds during the CAP transition period.
A further 55% is ringfenced for supporting young farmer startups and on-farm investments
The original proposal was for the funding to be released between 2022 and 2024 as part of the new CAP, but with CAP delayed, the last week’s agreement would see 30% released in 2021 and 70% in 2022.
The money will have strings attached. At least 37% will be for organic farmers, animal welfare and environment or climate-related actions.
A further 55% is ringfenced for supporting young farmer startups and on-farm investments.
The Department has earmarked €56m to finance a number of new initiatives announced in the budget.
The remaining 8% will be at the discretion of each member state.
However, the political agreement requires formal endorsement by both the Parliament and the Council.
They are objecting to the inclusion of a clause in the package that would allow the EU to cut off funds to a country that is found to be violating the rule of law
The Parliament is due to vote on the agreement, along with the CAP transitional regulations in December, so they can enter into force before 1 January 2021.
Securing the agreement of the Council, however, has already hit a major stumbling block as Hungary and Poland have registered their opposition to the entire €1.82 trillion budget-and-recovery package.
They are objecting to the inclusion of a clause in the package that would allow the EU to cut off funds to a country that is found to be violating the rule of law.
There is no solution to the disagreement in sight, and without it, the €750bn recovery fund remains in limbo and spending under the EU’s normal budgetary framework could be drastically reduced next year.
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