Editorial: budget exposes this Government’s lack of commitment to farmers

Despite the constant rhetoric from Government ministers on the need for farmers to become more innovative and forward thinking, we saw zero evidence of any policy innovation or indeed forward thinking contained within the Government’s budget commitments to farmers.

For farmers, Budget 2022 was a holding budget with the maintenance of support for existing farm schemes taking centre stage. It is worth pointing out that many of these schemes were designed almost a decade ago. Despite the policy demands on farmers having changed dramatically over this period, we continue to trundle on with supports targeted in the exact same way.

Budget 2022 provided the opportunity to road-test or pilot new innovative schemes with the potential to improve economic and environmental sustainability in advance of these measures then being rolled out under the next Common Agricultural Policy (CAP) in 2023.

For example, a pilot scheme aimed at reducing the average age at slaughter of beef-bred animals over the next 12 months would have demonstrated the extent to which such a scheme could reduce emissions by influencing farmers’ selling decisions.

It would also have helped address some of the economic challenges that are looming for the beef sector in 2022 and recognise that the small number of additional measures within the budget are likely to be availed of by those in the dairy sector.

Perhaps the decision to divert €49m in support away from farming signals something more worrying than a Government with a lack of foresight or innovation

But as Pat O’Toole reports, instead of showing this level of foresight and commitment to the sector, the decision was taken to divert €49m that should have been available to support these pilot programmes into the Department of Social Protection. This is not a criticism of increasing funding to social protection, it just shouldn’t come at the expense of farmers – 50% of whom have an annual income of less than €10,000.

Carbon budgets

At the very least, the decision to divert this funding and delay the State’s investment in supporting farmers in their green transition must be reflected when it comes to setting the carbon budgets for the sector.

Like the Government’s decision on funding, emission reduction targets for the sector now need to be back-loaded into the 2026-2030 period. Allocating any significant reduction target for the 2021-2025 period, against a backdrop where the rollout of the necessary schemes and financial investment will only commence in 2023, would make no sense.

But perhaps the decision to divert €49m in support away from farming signals something more worrying than a Government with a lack of foresight or innovation. Does it expose a Government that no longer has regard for the farming community and their representative organisations?

We only have to cross-reference the increased demands contained within the pre-budget submissions from the various farm organisations against what was delivered within the budget. Repeated demands for an extra €50m for ANC payments, a €300 per cow payment and a €30 per ewe payment, among others, all fell on deaf ears.

In response, farmers got an additional €5m for the soil-sampling scheme and a token multispecies sward grant to promote a technology that has yet to undergo any significant research work beyond trial plots. Clearly an example of where the policy agenda is running ahead of the research data with little regard as to impact on farmer income. The consequences of not coming forward with farmer-led policy is also exposed.

The outcome puts IFA president Tim Cullinan in a difficult position. Last Friday’s protests, which were well organised and well attended, were used to send a very clear warning to Government: the IFA will go to the streets of Dublin and stay there if the Government refuses to engage directly with farmer representatives on CAP, climate change and nitrates measures.

Ignoring IFA concerns

But rather than use Budget 2022 to show the IFA that it was listening, the Government chose to ignore the message. Instead, it pushed ahead with what it knew would be a highly controversial decision to reduce funding from the carbon tax receipts that had been ring-fenced to support the sector in meeting climate challenges – a fund that farmers and rural communities are being forced to disproportionately contribute to through higher fuel and energy costs.

The pre-budget white paper published last week on public finances, showing higher than expected tax receipts across the board, provided ample scope for the move to be reversed last weekend in the face of Friday’s protest. The fact that the Government chose to push ahead regardless is extremely telling.

Rather than recognise the extent to which farmers have lost out on EU support under green transition funds and address their concerns, the Government decided to double-down by rowing back on promised Exchequer funding.

Meanwhile, contained within the budget were details on how the Government plans to spend the €1bn Brexit Adjustment Reserve (BAR) fund. As we report in this week's edition, €500m will be allocated per annum over the next two years. The extent to which the exposure faced by farmers, and particularly the beef sector, has dropped off the radar when it comes to Brexit support is stark. Defending this on the basis that the current beef market is delivering over €4/kg is absurd.

Unaware or doesn’t care

It appears the Government is either unaware or doesn’t care that a very serious train has left the station in relation to the impact of Brexit on the Irish beef sector. As things stand, Australia is on the train and New Zealand will get aboard in the coming months. In the years ahead, so too will South America and the United States. When these trains arrive into Britain in the months and years ahead, we will see Ireland’s largest beef export market internationalised with the higher premium retail market locked down with domestic produce. In this context, the here-and-now beef price is irrelevant.

Irish beef farmers need to ensure that by far the greatest share of this €1bn BAR fund is ring-fenced to help restructure the sector in advance of a major market disturbance that is coming down the tracks, albeit a few years away. Farmers cannot find themselves looking to a BAR fund in 2024 when all the money is spent and their main export market is gone.

Unfortunately, the voice of farmers on how this funding should be deployed into the sector has been almost completely silent while other sectors have been putting forward coherent policy positions.

Farmers forgotten

Overall, the outcome of Budget 2022 will reinforce the views expressed by many farmers at the IFA protests last week. This is a Government that has forgotten farmers in the face of multinationals. It is a Government that is prepared to allow the largest indigenous sector, particularly suckler and beef farmers, slowly wither on the vine. It is a Government that is allowing agricultural policy to be led by the Department of the Environment rather than the Department of Agriculture with no regard as to the impact on farm incomes. It is an urban-centric Government that does not recognise the role of agriculture in generating economic activity throughout rural towns and villages.

Attention now moves towards how the farm organisations will react to a budget that exposes a this Government’s lack of commitment to farming and rural Ireland.