The Dept. of Agriculture have recently published their proposals for ensuring that commonage lands remain eligible for direct payments in the next round of the Common Agricultural Policy. The background to this move includes the impact of the significant changes in the structure of the CAP (Common Agricultural Policy) after 2014. The EU Commission is proposing that direct payments should progressively converge and payments to large beneficiaries be subject to progressive capping. Within Ireland this proposal would have effect of reducing the value of the single payment scheme entitlements received by large farms principally in the south east and increasing the value of those held by farmers in the west of Ireland. While the extent of this change is still under negotiation it is likely that western farmers and in particular Suckler Cow and Sheep enterprises could be significant beneficiaries.
The present CAP is based on a two pillar structure. In simple terms Pillar I pays for the Single Payment Scheme, Pillar II is for Rural development and co-finances the agri-environment schemes, e.g. REPS/ AEOS along with the Dis-Advantaged areas scheme. At the moment most commonage farmers payments are dominated by REPS/AEOS and the Dis-advantaged area payment with the Single Payment Scheme a poor third in many cases. This is not the case on a national level where the Single Payment Scheme is by far the most important source of direct payments. Even a partial implementation of the EU Commission proposals will lead to a change both in the size of direct payments to commonage farmers but also in makeup of these payments. In particular it is likely that the Single Payments Scheme or its successor will become more important to the commonage farmer. One benefit of this is that this payment is completely financed by the EU and so is not exposed to budget cuts in Ireland.
While the new CAP offers significant opportunities for commonage farmers, the key challenge is to ensure that the land on which the payments could be drawn down remains eligible. An understanding of the purpose and objectives of these payments is central to appreciating the impact on current practices. A key objective of EU funding is to support farmers in adopting and maintaining farming systems and practices that are favourable to environmental and climate objectives. The direct payments are in part, a payment for the provision of these public goods, i.e. land in GAEC (Good Agricultural and Environmental Condition). The difficulty for commonage farmers is that if these public goods are not provided then how can they be paid for?
In a shared grazing resource like commonage, the primary issue is whether the public goods, i.e. land in GAEC that are being paid for by direct payments are being provided or not. The issue of who is responsible for a failure to provide them is very much a secondary issue and one primarily for the landowners themselves. The challenge therefore for both the Dept of Agriculture and for commonage shareholders is to ensure that as much commonage land as possible remains eligible for direct payments.
The Dept. of Agricultures response to this challenge is to introduce a requirement for Collective Agreements on stock numbers between the shareholders on each commonage. This appears to solve the eligibility issue; the maintenance of land in GAEC then becomes an ongoing requirement for the shareholders themselves based on the implementation of these agreements. A lead in time of two years has been proposed by the Dept of Agriculture to achieve the required stock numbers. At this point it is important to appreciate that the situation in every commonage is different, some commonages are already in GAEC, other suffer from under grazing, some are still damaged by overgrazing. In addition the farmers involved in each commonage are different; they have different enterprises and different views on how the commonage should be managed. Considering all of these differences it is clear that imposing a one size fits all solution is not realistic and that the only way to accommodate the wide range of situations is to involve the shareholders themselves in the decisions affecting their commonage.
The proposals made by the Dept of Agriculture are radical and represent the greatest change to commonage management since the introduction of the commonage framework plans. Like the situation in the late 1990’s action is required in order to assure the continued eligibility of commonage for direct payments. Unlike the commonage framework plans which were imposed from above, a large part of the current proposals involve devolving decision making down to the shareholders of each commonage. The shareholders of the commonage perform this role by participating in a collective agreement. The objective is to ensure that the land is maintained in GAEC and so secure continued eligibility for payments. To assist in this process the Dept of Agriculture and the NPWS have calculated maximum and minimum stocking levels for each commonage land parcel. This was based on the stock carrying capacity of the habitats involved, their condition when the commonage framework plans were produced and the expected recovery in condition since then. The expected recovery was based on that observed during a wide ranging monitoring program over the past 10 years. Where the shareholders believe that these figures are incorrect they can be appealed.
While the Dept of Agriculture have made these maximum and minimum figures available it is for the shareholders through their collective agreement to decide on how a stock number between the maximum and the minimum can be best achieved.
The changes that are underway are dramatic but they offer the potential for increased payments which will be secured until 2020 along with an opportunity in some commonages for active farmers to develop their enterprise. Commonage is a shared resource, by co-operating with each other; farmers can ensure that they share in the benefits from this resource. While the process will present difficulties, it would be a mistake to dwell on problems elsewhere or mistakes made in the past. In difficult times making use of the opportunity presented, getting as good a deal as possible particularly in respect of the lead in time and addressing local issues by considering an appeal appear to be better strategies.
The collective agreement should not be seen as a form filling exercise, it is not an end in itself but a process by which each individual farmer can ensure that;
The commonage remains eligible for payment.
The commitment in terms of stock to be grazed on the commonage is workable and achievable in the context of the overall farm enterprise and their own personal plans and circumstances.
The agreement cannot be considered as something that is written in stone, for if it is to be workable it must be reviewed by the farmers concerned on a regular basis. For example if because of a change in personal circumstances Farmer A is no longer able to continue to meet his commitment to keep 100 ewes on the commonage then the other shareholders must be able to review their agreement to see how it can be adapted to the new situation. Likewise if a dormant shareholder wishes to commence farming then the agreement must be capable of being amended to accommodate him. In essence the collective agreement is establishing a system of community based governance of a shared resource. For many this may be a difficult process and particularly in commonages with very large numbers of shareholders, the negotiation of a workable agreement will be challenging. To assist in this process the Dept. of Agriculture requires that a farm advisor with experience in commonage issues facilitates this agreement. The advisors role is to facilitate the negotiation process in a manner that ensures fair consideration for all shareholders and reduces the risk of a breakdown in negotiations.
The importance of achieving a workable agreement cannot be underestimated as all direct payments on the commonage from 2014 to 2020 will depend on it. There are two principal issues involved, first to ensure that the commonage remains eligible for payment, this is dependent on putting a collective agreement in place and secondly ensuring that the commonage remains in GAEC (Good Agricultural and Environmental Condition) this is achieved by maintaining an appropriate stocking regime in the years ahead. To put these issues into context, a commonage with 300Ha of land eligible for payment could receive upwards of €70 per Ha from Pillar I funding, approx €100 per Ha from Pillar II (assuming that the Dis-advantaged Areas Scheme is maintained) and approx €75 per Ha from an agri-environment scheme (current AEOS rate of payment). This represents total direct payments of €245 per Ha per year for 7 years or a total of €514,000. While the exact amounts are dependent on the final agreement on the Common Agricultural Policy, it is clear that very large sums of money are involved. The indications are that even a partial break with the historical model will result in an increase in payments for commonage farmers. While the individual farmer has no input into the negotiations of the new Common Agricultural Policy he does have an input into ensuring that his land remains eligible to benefit from it. Achieving this with commonage land is dependent on the successful negotiation and implementation of a collective agreement.
Commonage farmers will receive a letter from the Dept. of Agriculture in the coming weeks which will inform them of the maximum and minimum stock numbers for each commonage land parcel. This letter will also include the names of all those who are currently claiming payments on each commonage parcel. While there is a lead in time of two years, this is to provide some opportunity for farmers to adjust the size and composition of their flocks/ herds. It would be a mistake to assume that the negotiation of a collective agreement can be left to 2014 as this would carry enormous risks, negotiations would have to take place with a looming deadline, experienced advisors may be unavailable and there would be no time for stock adjustments to be made. For these reasons significant progress will have to be made on most commonages in 2013.
Adapting to the new system requires both group and individual action. As a group the first step for active shareholders is to consider the maximum and minimum stock numbers for their commonage and to decide if an appeal is warranted. Such a decision should be based not just on the balance between current numbers and those proposed but also on the condition of the commonage. For example, if a commonage is under grazed, an appeal aimed at lowering the minimum stock numbers to suit current flock sizes is unlikely to be successful and even if it did succeed, it may well prove counterproductive if the land fails to achieve GAEC status (Good Agricultural and Environmental Condition). If the shareholders feel that an appeal is required they should contact a farm advisor for details as to how this can be done. A decision on whether to make an appeal or not should be made before Christmas as the collective agreement will inevitably be delayed pending the outcome of a review. The second stage is to engage a farm advisor for the purpose of facilitating an agreement. Only one advisor can be involved in a given commonage, ideally one with a background in commonage management.
For the individual farmer the key issues are:
To discuss the general issues involved with their fellow shareholders. In particular the issue of whether an appeal is required and on engaging a commonage specialist to facilitate and agreement.
Consider how the management of the commonage fits in with their own farm enterprise and discuss any issues with the agreement facilitator and if appropriate with fellow shareholders.
Be aware that to remain eligible for payments after 2014 they must keep their share of the minimum stock required for the commonage. For example if the minimum stock number is 100 ewes and a farmer has a 1/10th share then he must keep a minimum of 10 ewes. The maximum number for each farmer will be determined as part of the collective agreement. Farmers who do not currently graze stock on the commonage will have to consider how they can participate in the collective agreement. As things stand they will not be eligible to claim payments on the commonage from 2014 onwards if they are not actively farming it.
Remember that only certain breeds of cattle and sheep will be considered as contributing to the stocking requirement. These are Blackface Mountain and Cheviot sheep, Aberdeen Angus, Hereford, Kerry, Irish Moiled, Dexter, Shorthorn, Galloway, and Highland. It is anticipated that Connemara Ponies will be added to the list. Farmers considering purchasing bovine replacements should consider the approved breeds when purchasing animal. This is particularly important if their herd is currently composed of continental breeds such as Limousin or Charolais.
The November 30th date refers only to AEOS applicants. AEOS plans produced for commonage farmers will have a minimum and maximum stock number for the farmer. While the minimum number must be maintained, the maximum number in the AEOS application is provisional and will be superseded by the Collective Agreement.
Ensure that their SPS applications are made within the application periods in 2013 and 2014.
While many farmers are concerned that within a collective agreement they will be exposed to penalties for the actions of their neighbour, the opposite is in fact the case. Without a collective agreement the action of the neighbour who abuses the shared property threatens the eligibility of the commonage for any payment at all. While within an agreement the neighbour will have made a commitment to his fellow shareholders and to the Dept of Agriculture and is exposed to penalties if he fails to live up to his commitment. The agreement also serves to protect the shareholders interests by ensuring eligibility for payment and providing a mechanism for co-ordinated responses to issues affecting their shared asset.
The negotiation of a collective agreement will be a key event for all commonage farmers, it should not be rushed and the issues involved must be carefully considered. There are those who will be ready to point out the difficulties and the reasons why the process will not work. However to state that agreement between farmers is impossible is an empty gesture. Of course there will be local difficulties and perhaps in some situations it will not be possible to overcome these but that is not an argument not to try to reach a consensus. In the vast majority of cases agreement is possible, not everyone will get everything they want but they can take action to secure their payments, to ensure their views are heard and to plan for their farms future.
There are serious issues with the details of the proposals where perhaps there is room to achieve a better deal, the lead in time is a case in point. However rejecting change does not present a solution and does the farming community no service. It is in the interest of all concerned that this process is successful, there is too much at stake to consider failure as an option.