Coveney confirms agriculture faces cuts in Budget

Minister for Agriculture Simon Coveney has confirmed that there will be cuts to both current and capital expenditure on agriculture in next month's budget.

Speaking in Brussels this morning ahead of a meeting of EU agriculture ministers, Mr Coveney said that agriculture had to take its “fair share” of expenditure reductions.

“We as a department have to take our fair share of expenditure reductions. This year is no exception. We will have to see some reductions in [current] expenditure. The targets would suggest that we have to make cuts in terms of capital expenditure also,” the Minister said, though he added that this year’s budget is likely to be the last tough budget.

“The last number of years have been difficult in terms of budgets and supports, in particular for schemes that would have made up a significant part of farmers’ incomes in the past so that’s why the real focus has been on trying to help farmers get as much from the market place as possible.”

Responding to claims by the Irish Farmers Association that the Department of Agriculture has seen a disproportionate cut to its expenditure compared to other government departments, the Minister said it depended on how expenditure was calculated.

“If you include the money that is spent on agriculture that comes from an EU budget then that’s not the case. If you only count the exchequer’s contribution towards the agriculture budget, then yes, the cuts have been significant.”

Cabinet ministers would not know the details of the budget cuts until the final few days before Budget day, the Minister said, though he added there was a recognition that the current momentum behind the agri-food sector needed to be maintained.

In terms of the overall deficit reduction figure, Mr Coveney said it was too early to speculate on whether the figure of €3.1 billion would be targeted. However, he said that it was important for investor confidence that Ireland sticks to its targets.

“We’re coming out of a bailout at the end of this year [...]we need to see this issue through now, make sure that international markets have confidence in Ireland and its future so that we can keep borrowing money as we need to next year. In order to keep that confidence in place we need to be meeting the targets we’ve set for ourselves.”

Among the items on the agenda at today's meeting of agriculture ministers is an update on the nascent trade agreements between the European Union and Canada, an issue that could have an important impact on Ireland, the Minister said.

“Ireland has both offensive and defensive interests here. We have an interest in selling more diary product into Canada. It’s a big market, big Irish community there and we think our dairy companies have huge opportunities,” he said.

However, Ireland also has a huge “defensive interest,” in particular in relation to beef.

"Ireland is by far the biggest exporter of beef in the European Union. The European Union is our key market, so if there's going to be a significant offer around beef access into Europe from Canada, we obviously want to try and shape that as best we can so that our own beef industry isn't undermined."