Irish Rural Link
Submission to the Department of Agriculture,
Fisheries and Food 2020 Committee
31stMarch2010
Tables of contents
1. General Comments / 22. Introduction / 2
3. The Rural Economy / 4
4. Rural Development Strategy 2007-2013 / 7
5. Farm Size and Structure / 7
6. Weaknesses of CAP today / 7
7. Irish Rural Link’s Vision / 10
8. Farm Safety / 11
9. Rural Communities & fostering the smart green bio economy
10. Climate Change / 11
11
11. Renewables / 12
12. Training
13. Conclusion / 17
18
1. General Comments
Irish Rural Link wish to reiterate our disappointment at the composition of the 2020 Committee, in particular the absence of a representative bringing a rural business and rural community dimension to the Committee’s work. Without this dimension we do not believe the Committee can adequately investigate the future relationship between the agri-food, forestry and fisheries sectors, rural communities and the wider rural economy. Irish Rural Link believe developing this relationship is vital to building a sustainable and resilient rural economy into 2020 and beyond. Exploiting and nurturing the opportunities for non agriculture based employment in rural areas must be integrated into the 2020 strategy. Given the Department’s central role in delivering the Rural Development Programme and particularly the priority of encouraging diversification of economic activity, the exclusion of an organisation representing the wider rural economy and rural communities from the Committee is regrettable. The omission of IRL from the Committee does not further the aim for a coherent rural development policy or linking CAP policy and the Lisbon, Gothenburg and Salzburg agendas.
1.2 Whither Synergy?
The absence of a question asking “how to ensure compatibility/optimum synergy with rural development policy and develop traction is the area” is regrettable. Studies such as Pobal’s (2009) Social Cost Benefit Analysis of the Rural Social Scheme highlight the benefits of non-agricultural measures for rural areas including substantial quality of life improvements, through increased social contact; increased social capital and greater access to training, advice and information. The learning associated with iniatives and the wider opportunities other non farm based programmes may present to rural areas and rural development must be considered as part of any 2020 strategy.
2. Introduction
Irish Rural Link have made a number of submissions in the past on rural development, the potential role of the CAP and the future of Agri-business. This hasincluded discussions with the Oireachtas Committees on Agriculture and Food and Social and Family Affairs. All our submissions are guided by the principle that the wider rural economy can and must benefit from the allocation of CAP fundsand developments in Irish agri-business, fisheries and forestry.
Irish Rural Link have identified 5 key challenges facing the Irish rural development which have informed this submission and which must be considered in the 2020 strategy. These are outlined below and explored in more depth throughout the document.
Table 1 Five key challenges
1. The low skills base of many of those working part-time in agriculture and of those leaving the farming sector / In the past construction offered employment for rural based people, particularly young men with a low skills based. Adequate training must always be available to this population and a review of the training and supports given to part-time farmers and smallholders must also be undertaken. These sections of the farming population are not adequately served by existing measures which focus heavily on viability to the detriment of nurturing and training such farmers to enhance productivity and make them aware of opportunities.2. The need for Irish farmers to diversify into new land-based enterprises which are less dependent on direct supports / This requires equipping and up skilling farmers with the business capacity to identify and grow opportunities in sectors such as tourism, sports and leisure and renewable energy production while addressing the challenges of an inflexible planning system. It requires greater links with the relevant departments.There is a particular need to comprehensively review the role of training agencies such as the Institutes of Technology, FAS and Teagasc in the delivery of training fit for the new demographics and changing agricultural population.
3. Enhancing the role of that agriculture can play in a more dynamic rural economy and reviewing and removing constraints on indigenous, and local, niche food production and processing / A review of food production and processing, from farm to fork, is required. Challenges include limits on artisan and local food production and the power of multiples. The role of large players in the market needs to be examined, as does the future role of large cooperatives and food processors, particularly in the context of recently reported remutualisation of the industry, which in the long term may see processing remaining with PLCs and decoupling from production. The Departments of Agriculture and Enterprise must be involved in realising the significant job opportunities in the sector but we cannot rely on existing structures.
While the intention of decoupling of farm payments to production of over supply, a consequence is that much farm production in Ireland is a primarily a loss making exercise now. The respective stakeholders in the industry including national government, the EU, retailers and processers need to take action to correct a food supply chain is effectively broken. It is inconceivable to think that primary producer can continue indefinitely to produce at a loss. If this indigenous industry is allowed to falter there will be significant aftershocks for the wider rural economy. Legislation also needs to be reviewed to protect not only primary producers but also the consumer in the food production equation.
This also needs to examine the role and long term viability of farmers markets and how to enhance them.In this regard there is a need to examine the role of local authorities in establishing local markets as well as examining the constraints placed on them because of inadequate legislation.
Farmer’s markets are an integral part of European rural communities and towns. Their establishment ensures that farmers can enhance their incomes, jobs are created and the food chain is considerably shortened, which in itself contributes positively to the requirements of climate change.
4. Supporting rural communities as key economic and social drivers. / Agriculture cannot be considered in isolation from the wider, non agricultural, rural community. Trends in agriculture confirm that greater consideration must be given to enhancing the sustainability of the wider community in any long term strategy. Community based enterprise centres are drivers of rural employment. The work of IRL members such Mountmellick Development Association and Ballyhoura Development - as well as the venue for our 2009 conference DunhillEcoPark - must be learned from, supported and enhanced. These projects have created employment in rural settings. Building linkages between such initiatives, agriculture and other industries is vital.
5. Meeting the changes to deal with climate change. / This can be used as an opportunity to benefit from lower costs via water recycling, efficiency and microgeneration. The location of Ireland’s renewable energy assets is inherently rural and the potential of crops (though not affecting food production) and the role of forestry is a key consideration. Specific research on such measures environmental and economic potential and a dedicated unit in the Department ensuring measures are coordinated and coherent is required to avoid a litany of distinct ‘green wash’ measures which do little to tackle climate change and which may on occasion cancel each other out. The green economy has further potential if green technology is researched and manufactured in rural areas. Ensuring enterprise supports recognise this is vital.
3. The Rural Economy
Rural areas are characterised by their narrow economic base. The rise in unemployment occurring across all sectors will be most difficult to resolve in rural areas which are over-reliant on primary industries such as agriculture, construction and low-level manufacturing, e.g. in 2006 34% of men in BMW region were employed in agriculture or construction while the Midland & Border regions are showing steepest drop in employment.
According to Teagasc farmers relying solely on farm income have a higher probability of poverty and deprivation. Furthermore, farmers working outside the farm tend to be employed at the lower skilled end of the employment spectrum which further exacerbates their exposure to the downturn (O’Brien and Hennessy, 2008). The average farm income is below the average industrial income at less than €20,000 (Department of Agriculture, Fisheries and Food, 2009).
The CSO’s “County Incomes and Regional GDP for 2006” (2009) show that the disposable income per person in 2006 in the Southern and Eastern region was 3% above the State average while the corresponding figure for the Border Midland and Western region was 8.3% below the State average. The CSO figures show that disposable income per person was highest in the Dublin region, where it was more than 12% above the State average. The Border region was 8% below the average and the Midland region was 9.4% below average. Only Limerick, Kildare and Meath were the other counties above the State average. Eight counties were below 90% of the average, with Kerry over 13% below the State average. Donegal had the lowest disposable income per person at more than 16.5% below the state average. At the level of the eight Regional Authority areas the Dublin region had the highest disposable income per person, being 12.3% above the State average in 2006. The disposable income per person of the Midland region was 9.4% below the State average in 2006 and was the lowest of the eight Regional Authority areas. The deterioration in the economy will inevitably result in an even deeper gap between the incomes of rural and urban workers.
There is significant deprivation in rural Ireland with two thirds of the economically poor living in rural Ireland and almost a quarter of farm families living with an income of below the minimum wage (McDonagh, 2006). Many low-income household budgets are fully committed. A recent study indicated that in Ireland the percentage of people at risk of poverty[1] is 14.3% for urban areas and 21.5% in rural areas (Bertolini, Montanari, and Peragine, 2009).
Rural households’ disposable income is already below that of their urban counterparts[2] and recent CSO figures have shown that disposable income per person was highest in the Dublin region, where it was more than 12% above the State average. The Border region was 8% below the average and the Midland region was 9.4% below average. Only Limerick, Kildare and Meath were the other counties above the State average. Donegal had the lowest disposable income per person at more than 16.5% below the state average.
According to the 2006 Census, only one in five (21.5%) of the working population of rural areasis working in agriculture(as a farmer or agriculture worker), a decline from one in three (31%) in 2002[3].
There is clearly a significant and growing rural population who are not engaged in agriculture,and as rural areas tend to have different needs, operate at a different scale to urban areas, have differentissues regarding access to servicesand have been harder hit by the loss of jobs in the recessionand will find it most difficult to access opportunities in any future growth.
This situation requires a shift away from primary production to higher value sectors and activities which will require rural communities’ to mobilise their strong track record of innovative thinking and adapting to changing circumstances, e.g. on the group water scheme. Without this transformation, economic growth will continue to concentrate on Ireland’s core regions with the highest value-added sectors and this will exacerbate regional inequalities in growth, productivity and incomes.
4. Rural Development Strategy 2007-2013
Irish Rural Link has consistently complimented those involved in the preparation and compiling of the National Rural Development Strategy 2007-2013. We note the obligations of the strategy to adhere to the European Union’s Regulations and Strategic Guidelines as well as honouring the Lisbon Agenda. We welcomed in particular the threefold increase of the budget available to specifically rural development issues under Axis 3 and 4. However, we must point out that of a total budget of €7 billion the amount proposed for rural development of €425 million represents just over 6%, and when broken down over a 6 year period may well fall short of overall expectations, as the following table shows.
Table 2 Breakdown of RDP 2007-13 Spending
Environment and farm / Farming / Forestry / Rural / Amountfor the Rural Environment Scheme (REPS) and Natura / €3 billion
Disadvantaged Scheme / €1.8 billion
for forestry / €968m
Farm Restructuring / €481m
Rural development / €425m
€6.499 billion
Writing recently Commissioner Fischer Boel (2009) stated:
With regard to the future of the CAP, I’ve given my personal view that rural development policy is where “a lot of the music will be in future”. It will do its share of the work of pulling us out of the economic crisis. And it’s also emerging as one of the main policy tools with which we can confront the challenges of climate change and water management, as well as seize the potential of renewable energy.
Irish Rural Link are not convinced such broad thinking is adequately reflected in the documentation the Department has circulated as part of this consultation process which focuses too narrowly on trying to maintain the status quo.
5. Farm size and structure
If we accept that almost half of all farms (Irish Agricultural Development paper, p.8) are vulnerable and that the decline in farm numbers is persistent and inevitable we need a strategy to deal with this and develop off farm economic opportunities in rural areas for these farmers and their families. A key challenge will eg laing landholders have access to a suite of supports and advice aimed at those who no longer consider full-time farming a viable option.
6. Weaknesses of CAP today
6.1 Weaknesses of CAP
The EU Commission’s has a stated commitment to a “European Model of Agriculture” which “is not the same model as pursued by our major competitors elsewhere. There are many differences between ours and theirs. Seeking to be competitive should not be confused with blindly following the dictates of a market that is far from perfect. The European model is designed to safeguard the earnings of farmers, above all keeping them stable, using the machinery of the market organisations and compensatory payments.” However, given that direct payments now account for 98% of Family Farm Income, the long-term sustainability of our current agricultural model surely needs to reconsidered to ensure that it is less reliant on income supports.
According to the ex ante evaluation of Ireland’s draft Rural Development Strategy (AFCon, 2006) the whole programme was based on trying to stimulate rural areas on the basis of agricultural investment. There is an underlying assumption that interventions are mainly implemented via farmers who are seen as central to the rural economy notwithstanding the decline in farm numbers.
Dwyer and Maye of the Universities of Gloucestershire and West of England (2009) completed a comparative analysis of the design and early delivery of the Rural Development Programmes of Ireland and England and make some interesting points. In interviews Dwyer and Maye asked participants for their views on RDP priorities and reasons for the choice of measures. Interviews with Irish officials who drafted the RDP emphasize pragmatism, with one explaining “…we were obliged to spend so much on Axis 1, so much on 2 and so much on 3. So we found ourselves looking at a menu and saying “what is going to best fit with our national priorities?””.
According to Dwyer and Maye the comments also suggest a strong commitment to support for the farm sector, as part of a longstanding concern to boost farm incomes. Dwyer and Maye argue that the influence of the farm lobby emerged as particularly significant in respect of the design of the Irish RDP. This is part of a highly embedded political process. As one respondent explained, “I think farmers will see it as designed to transfer money to them, so the thing is to make it as easy as possible, as straightforward, as certain, as possible”. Dwyer and Maye state that there is perceived to be a sense of ‘inevitability’ about the orientation and emphasis of the Irish RDP towards the farm sector.
As noted in the ex ante independent report:
Weaknesses under Axis 3 could be developed further beyond low level of broadband availability – there is little about local social infrastructure, transport for elderly, etc. Also it would be useful to define in what context is something considered a weakness – agricultural development or quality of rural life.