CAP payments critical to N Irish economy - Phil Hogan

European Agriculture Commissioner Phil Hogan has defended the EU Common Agricultural Policy by stating that for every £10 earned by Northern Ireland farmers, £8.70 comes from the CAP.

In a lecture at Queen's University on Monday night, the former Fine Gael minister said while agriculture has not featured prominently in the Brexit referendum debate, it was of critical importance to Northern Ireland.

"CAP Single Farm Payments to farmers in Northern Ireland is worth in excess of £2.3 billion from 2014-2020. To put that figure into perspective, annual payments from the European Union account for 87 per cent of annual farm incomes, compared to 53 per in the UK as a whole," said Mr Hogan.

“In other words, for every £10 sterling that Northern Irish farmers earn, the Common Agricultural Policy accounts for £8.70 of that total,” he said.

“To put it more bluntly, were it not for European assistance, many farms would not alone generate significant losses, but would struggle, and in many cases fail to survive,” added Mr Hogan.

The Commissioner said he wanted to make clear that he was not advising anyone how to vote and that the Brexit issue was a matter for the people of Britain and Northern Ireland alone. Nonetheless, he wanted to set out the facts in relation to the EU.

‘Strong prospects’

"Whether they are dairy farms in Fermanagh or orchards in Armagh, the European Union has supported Northern Ireland's family farming tradition and provided it with strong prospects for the future," said Mr Hogan.

He said that EU was the world’s largest agricultural trader. “It offers the world’s largest agri-food markets, with exports exceeding €129 billion in 2015. In total, farmers in Northern Ireland have the opportunity to capitalise on over 53 trade agreements which allow for agri-produce to be exported and imported without any red tape.

“As part of our ongoing negotiations, we aim to establish new trading agreements which would enable all EU member states to extend their sales to other Asian markets,” added Mr Hogan.

Mr Hogan said he was not arguing that the CAP was a perfect policy instrument, and “like any legislation reformed through compromise, it contains provisions which can be improved”.

“While I will robustly defend the importance and value of the CAP, I also recognise that we must always strive to make it simpler and fairer. We must cut red tape and the costly burden of regulation for farmers,” he added.

Cross-Border trade

Mr Hogan posed a number of questions on what might happen should the UK vote to quit Europe. "If any form of land border is reintroduced, how will this disrupt the substantial cross-Border trade in agri-food products? There is constant daily movement of live animals for fattening, and dairy products, to name just two elements of the trading relationship," he said.

“Will Irish farmers lose tariff-free access to the UK market and vice versa? We must remember that there were quite substantial monetary correction mechanisms in the 1970s.

“And how will this impact on cross-Border smuggling and illegal trade? There will be clear incentives to recreate the old channels of smuggling across the Border, and the consequent increase in resources from both states to deal with the problem.”

Mr Hogan added: “The relationship between people living and businesses operating either side of the Border is one of neighbourliness. I believe that it would be a retrograde step if that relationship was compromised by the potential tariffs, tailbacks and other trade blockages that an external border would entail.”

The Commissioner also queried how the UK, with a population of 64 million, would fare in negotiating with countries like China, with a population of 1.3 billion.

“The EU punches at a weight of 500 million, almost twice the size of the US. It could take the UK years to negotiate deals with Korea, Canada and so on - deals the EU has already successfully negotiated.”

Mr Hogan said the EU could take some credit for helping to “bed-in” the peace process. “Since 1995, the EU has established three peace programmes, with a financial contribution of over £1.3 billion. I am happy to say that a fourth programme is currently in progress and will contribute over £270 million to Northern Ireland,” he said.