Clarity on the Land Eligibility Issue.

Over the last year there has been huge concern over the issue of eligibility of land as forage area. This is a critical point as a determination that land is ineligible not only leads to a reduced payment but can potentially lead to large penalties for over claiming.

Many commentators have advocated that the Dept. of Agriculture should make use of the provision referred to as article 4(h) within the EU regulations. This provision allows for payment on lands where heather and shrubs are predominant provided that they are grazed in accordance with established local practices. The Dept. of Agriculture position on this has been unclear until now.

The current position was outlined last week by the Minister for Agriculture in a reply to a parliamentary question from Eamon O Cuiv T.D.. In his reply the Minister has confirmed that areas containing Heather and scrub may be eligible for payment if there is evidence of agricultural activity.

This is a very important concession; it does not however mean that evidence of activity within a parcel means that the entire parcel is eligible. A common feature of many land parcels, particularly so on larger plots and on commonages is the uneven distribution of grazing pressure. Animals often preferentially graze on sweeter grass and avoid areas where the vegetation is less palatable. This pattern may be subject to change through the course of the year as stock change from one favored forage plant to another. Managing stock behavior to encourage grazing in under utilised parts of the site is a key step to ensuring continuing eligibility. 

Tirglas Advisors can give you practical advice on how this can be done in an effective and workable manner and help secure payments on as much of the parcel as possible. This is an issue that goes way beyond GLAS, The GLAS scheme is however a potentially useful mechanism to deliver the improvements that secure payments across all schemes.

 The full text of Eamon O Cuiv’s question and the reply from Minister Coveney follows.

Deputy Éamon Ó Cuív asked the Minister for Agriculture, Food and the Marine:

 "If the definition of permanent grassland for the purposes of the implementation of the basic payment schemes and greening schemes here include permanent pasture and shrubs and-or trees which can be grazed including established scrub and heather - Calluna vulgaris - in all stages of its life cycle and also land which can be grazed and which forms part of local practices where grasses and other herbaceous forage are traditionally not predominant in grazing areas, as set out in article 4 (h) of the direct payment regulations 1307/2014; and if he will make a statement on the matter".

Minister for Agriculture, Food and the Marine (Deputy Simon Coveney):
"The provision referred to under article 4 (h) of Regulation 1307/2014 for permanent grassland is 'land used to grow grasses and other herbaceous forage … it may include other species such as shrubs and or/trees which can be grazed provided the grasses remain predominant as well as where member starts so decide land which can be grazed and which forms part of local practices where grasses and other herbaceous forage are traditionally not predominant in grazing areas'.

In relation to the Basic Payment Scheme, the requirement is that each agricultural parcel declared by an applicant under this Scheme must have a farming activity on it to be eligible for payment. Such an activity, which must be appropriate to the type of land involved and which should ensure that the area currently eligible for payment remains in this state, includes grazing the land.

The areas as described, excluding established scrub and ungrazed heather will, in general terms, be eligible under the Basic Payment Scheme provided there is evidence of an agricultural activity being carried out".

Grazing Agreements, Clarification needed.



Inagh Valley, Co. Galway. Very small areas of enclosed land to support hill flocks, grazing plans will be difficult to put in place and are likely to need fine tuning for some time to get the balance right.

While many aspects of the Dept. of Agriculture's proposals are laudable, they are repeating some of the mistakes that were made in late 2012. It is true that they have moved away from the requirement for a unanimous agreement and are more realistic about the time required to adjust flock sizes, these are important clarifications and are to be welcomed. However the Dept. of Agriculture have still not moved to address several key concerns. These include;

1) How are dormant shareholders to be dealt with? In particular, will the requirement for 80% of shareholders to participate in a grazing agreement include the dormant shareholders? If it does, the process is going nowhere, as on average approx. 1/3 of shareholders are dormant, many of these are not even traceable and others may potentially derail an agreement by demanding a cut of any payments. 

2) How are inactive shareholders going to be treated? How are they even going to be defined? This is potentially an even more difficult issue as many such farmers will insist that they are active in an attempt to hold onto forage area. Others will seek to change their farming system by starting to use the hill again. While this is within their rights, it will complicate the process of reaching an agreement on the commonage.

3) How much time will be available to negotiate agreements? If GLAS is to open in Jan 2015 than time is rapidly running out.

4) How will all of this link into the launch of the GLAS scheme? Are AEOS 2 and 3 farmers with commonage going to find themselves out of a scheme, if agreement is not reached in respect of their commonage in time?

5) Will admission to GLAS be limited to an annual quota or will the scheme remain open until the 50,000 places are filled? Is there a risk that GLAS could be filled before commonage agreements are in place? If it does then many commonage farmers could be permanently excluded from an agri environment scheme.

6) What provision will be made to provide professional assistance to farmers in negotiating an agreement? How will this be paid for? Will it be paid for directly by the farmers or through a voucher system? It should be clear to all concerned, that if the cost is to be left to farmers to pay and the farm advisor to collect, then commonages with large numbers of shareholders such as Achill Island will never be facilitated.
7) The Dept. of Agriculture must appreciate how difficult it will be for an individual farmer to take the initiative to sell this concept to his neighbours, some of whom may be unconvinced of its merits. This is a real barrier to progress, if it is to be overcome than all the other barriers in particular the transaction costs must be fully compensated for and the cash flow implications for all concerned reduced to an absolute minimum..
8) A professional advisor will be required to facilitate an agreement, however this raises very real issues for advisor and farmer alike.  Foremost of these is the associated transaction cost, not surprisingly the advisor will want to be paid and it is unreasonable to expect him to seek payment from each individual shareholder. Such a task may prove impossible and will deter many advisors from getting involved. This is particularly relevant on commonages with very large numbers of shareholders. Imagine the difficulty for an advisor in splitting his fee 100 ways and trying to collect this amount from each shareholder. Then consider the alternative, the difficulty for a farmer, to take it on himself to collect the money from 99 other shareholders to pay the advisor; it won't happen. 

I suggest that as a minimum that Dept. of Agriculture should consider all landowners who did not declare the commonage in 2013 as being dormant. If they want to come back into farming they should be allowed, but they should not be in the calculation of what constitutes the qualified majority needed for a grazing association. The issue with inactive shareholders is more complicated but perhaps one solution is to allow them to claim the basic payment and the ANC payment provided they participate in the grazing agreement but restrict the GLAS payment to active farmers.

As regards the cost of putting a grazing agreement in place, it is clear that the Dept. of Agriculture do not want to get involved in paying farm advisors directly, however they could issue farmers with a voucher to purchase this service from an approved farm advisor. The advisor could be paid by the Dept. of Agriculture on submission of the voucher provided a grazing plan is agreed. The Dept. of Agriculture could then recover this money from future payments due to the farmer. GLAS+ would provide a suitable mechanism for meeting this exceptional item and ensuring that the farmers costs are met. Finally the NPWS could finance the transaction costs for a number of flagship commonages to demonstrate to farmers around the country that progress is possible.

Clarity is needed on all of these issues.  The Dept. of Agriculture must publish a real implementation plan very soon.

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Teagasc Hill Sheep Conference

The Teagasc Hill Sheep Conference is to be held in the Westlodge Hotel, Bantry, Co. Cork on the 22nd January. It is a STAP approved National event. The programme is very interesting and should be of value to anyone with an interest in Hill Sheep farming. Of particular relevance to commonages is the attendance at the conference of Mr Liam Fahey from the Dept. of Agriculture, Food and the Marine. Mr Fahey has played a central role in highlighting the potential problems that may face the eligibility of commonage lands for direct payments in the future. He is also likely to have a key part to play in the development of a strategy to ensure that commonage land is brought back into GAEC and that future payments can be guaranteed.

I hope that he will be in a position to announce the start of the engagement process with commonage stakeholders at this conference as time to develop an agreed approach is rapidly running out. The operating programmes for the next RDP will be agreed with the EU Commission by the end of the summer. If a workable commonage solution is not in place by then it will be too late. This solution will not fall into place overnight and if there is to be any chance of success it must start this month.

You can download the flyer for this event from the following link.

http://www.teagasc.ie/events/2014/Hill%20sheep%20flyer%20web.pdf

What is Commonage?

In Ireland, commonage is land that is owned by more than one person. Typically each shareholder owns a defined fraction of the total area and this is detailed on each shareholders folios. It should not be confused with the term “tenants in common”, which is where the land described on a folio belongs to two or more persons. This may happen where land is inherited jointly by siblings or where land is purchased by two or more people. Land held by “tenants in common” is not normally considered as commonage.

Another situation is in respect of lands where there are “grazing rights”. These do not involve any ownership of the land but as the name suggests give a right to graze livestock on the area involved.

Over the years the shareholders on many commonages have decided to “stripe” or split their commonage between them. In spite of this approx 426,000 Ha of commonage remain. Over 11,000 farms have a shareholding in one or more of the approx 4,500 remaining commonages.

Commonage Review

All farmers with commonage will shortly receive a letter from the Dept of Agriculture, Food and the Marine regarding how the recently completed commonage review will affect them. This review has completely changed how commonages will be managed in the future and has implications for stock numbers and for direct payments to commonage farmers. It replaces the commonage framework plans and it is hoped will lead to a more community based approach to commonage management. 

Commonage Framework Plans have governed sheep numbers on commonages for the last decade. However in recent years it has become increasingly apparent that these were dated and no longer provided for the needs of those involved in commonage management. To deal with this, the Dept. of Agriculture and the National Parks and Wildlife Service have reviewed the Commonage Framework Plans to make them more relevant to current requirements. This review was based on the patterns of recovery observed in commonages throughout Ireland since 2004. 

Implementation of the commonage framework plans resulted in many farmers having to destock from their original ewe quota level. The new system breaks the link with the old ewe quota and instead allows farmers to stock at sustainable levels. In effect this means that the starting point is zero and that farmers can increase their stocking to a sustainable level as determined in the commonage review. 

The new system also introduces a collective approach to managing commonages. It will be the shareholders themselves who will determine how many animals each farmer will graze on the commonage. However the total number must be within a minimum and maximum number for the commonage as set out in the letter from the Dept. of Agriculture. This collective responsibility may also allow the Dept. of Agriculture to impose penalties on all shareholders if a commonage is improperly managed. 

Farmers utilise the commonage for grazing livestock, but it also represents forage area on which they get paid in the dis-advantaged area and single payment schemes To ensure that all farmers can continue to get what they need out of their commonage they should reach an internal agreement among themselves. This agreement must be agreed by the farmers themselves however it may be facilitated by an expert third party. The agreement will ensure that all shareholders know where they stand, what commitments they have and how they will resolve any disputes, either between themselves or with outside bodies. In short the internal agreement sets out how they are going to manage their commonage. The contents of the agreement are up to the farmers themselves but as a minimum it should set out how many animals each farmer will keep so that the group can meet the sustainable stocking requirement. 

It is unlikely that an even split between all shareholders will be the optimum approach to achieve this. The circumstances and farm enterprises of different shareholders will vary, some may be unwilling to increase numbers at all, others perhaps, may wish to increase to a level in excess of what an even split would allow. The situation is further complicated by dormant shareholders who do not farm the commonage at all and by the renting and leasing of shares. While dealing with all of these issues is not straightforward, the problems posed are manageable. However to do this successfully requires a structured and most importantly, a workable agreement between the shareholders. 

This is an opportunity for farmers to manage their commonage together, largely free from external interference. It is not something that people should fear or be apprehensive about, but it does require their careful attention.

AEOS 3 Scheme Announced

AEOS 3 schemes announced at the ploughing championships. The Minister of Agriculture, Food and the Marine has announced that €20 million euro has been made available to finance an AEOS 3 scheme. This will be enough to accommodate approx 6,000 farmers. Priority will be given to farmers with commonage or Natura land (SAC or SPA). The details of this scheme have not been announced yet but are expected in the very near future.

Full details will be posted on this site as soon as they are available.