Despite an expectation that the value of direct payment entitlements introduced in 2015 would transition to an average of €333/ha over the seven years to 2021, it looks increasingly likely that entitlements could now be frozen at 2019 rates (step five of seven). With the UK government’s commitment to retain the current support budget to the end of the current parliament, the 2019 entitlement value on a NI farm would then roll into 2020 and 2021. It might even be applicable beyond that, depending on how quickly a new domestic agricultural support system gets off the ground.

A consultation document released last week by DAERA explores the two options up for debate – whether to freeze at 2019 values, or continue the progress to a flatrate payment in 2021.

However, the document makes clear that there is at present no basis under current EU law to continue the flattening out of payments beyond 2019 and to 2021.

“The transition process post-2019 in order to achieve a flatrate unit value is not deliverable under the current legislative framework,” notes the DAERA consultation.

If there is a desire to continue to flatten payments to 2021, it would require a revision to be made to domestic legislation after Brexit, and direction from a minister. Unless that happens, “the unit value of entitlements would be frozen at 2019 rates for future years,” states the consultation.

Inevitably, there will be winners and losers either way. However, given that many claimants with high value entitlements in 2014 were able to spread these over a larger land area when entitlements were re-calculated in 2015 (as non-farming landowners exited the system), the impact is less than might have been the case.

Those gaining from a freezing at 2019 rates are generally lowland farmers, and cattle and sheep farmers in the disadvantaged area.

The group that would miss out the most are sheep farmers in the severely disadvantaged area (SDA). DAERA analysis shows that these farmers would, on average, see an 11% increase in payments over 2019 levels if entitlements are fully flat rate by 2021.

The DAERA consultation closes on 30 September 2019.

Alarm

Meanwhile, the Ulster Farmers’ Union (UFU) has reacted with alarm after comments made by Conservative leadership candidate Boris Johnson on a visit to Scotland last weekend. During his visit, he committed to ensuring that Scottish farmers after Brexit receive the same per hectare farming payment as the UK average – effectively an additional £25m going to Scottish farmers.

“We are seeking clarity about where this additional money will come from. Any suggested reduction in the amount of agricultural support for NI is cause for widespread concern and something we are firmly opposed to,” responded UFU president Ivor Ferguson.

With NI per hectare payments the highest in the UK (around €333/ha), any move to implement a UK average (with Scotland at €130/ha; England at €265/ha and Wales at €247/ha) would represent a significant cut for NI farms.

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Battle lines drawn on payments

Severely disadvantaged farms top CAP list in Northern Ireland