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A provisional agreement between the EU and the UK government on the terms of a transition deal after the UK leaves the EU on 29 March 2019 provides some more clarity on what might happen to direct payments currently going to farmers.
The transition deal would see the UK stay in the EU single market and customs union until the end of December 2020, meaning current rules must be followed until then.
It also means the present system of direct payments continues in 2019, and probably also in 2020, although whether payments are made from national or EU monies in 2020 is impossible to predict at this stage.
Beyond that date, the UK government has suggested that payments will remain until 2022 or possibly 2024, but it is likely that it will be 2021 at the earliest, before any significant changes to existing rules are made.
The main sticking point in Brexit negotiations remains the question of the Irish border, and in the draft transition deal outlined this week, it is the main area still to be agreed.
The UK government think the solution lies in a comprehensive free trade agreement with the EU after Brexit. But despite that, at the insistence of the EU, the draft legal text still includes a “back stop” option where NI remains in the EU single market and customs union post Brexit.
That is something opposed by Unionist politicians, but also by many leaders in NI agri-food given that Britain is by far our largest market, accounting for nearly 50% of all sales. The fear is that a trading border in the Irish Sea would add to costs, and leave NI food companies uncompetitive in the British market.
If a workable solution isn’t found, and NI was to remain in the EU single market and customs union after Brexit, it also presumably means that NI farmers would remain within the CAP. That would have to be agreed, but a situation where farmers here had to abide by EU rules and regulations, but not avail of direct payments, would be untenable.
A round of talks focusing solely on Irish issues is due to begin next week, and negotiators are also due to start talking about future trade. The transition deal will only be legally binding if a withdrawal treaty is agreed by next March.
SHARING OPTIONS: