Northern Ireland farmers will receive what could be their final pre-Brexit EU payments under the Common Agricultural Policy worth a total £281 million (€333 million) on Thursday.
The North’s Department of Agriculture, Environment and Rural Affairs confirmed that the payments, which farming union leaders have warned are vital to the North’s rural economy, will arrive in 23,609 farm businesses bank accounts in Northern Ireland on Thursday.
Ivor Ferguson, president of the Ulster Farmers’ Union, said the CAP payments “represent a significant cash flow boost for farm families”.
Rural economy
Mr Ferguson has previously warned the importance of the EU payments to farm businesses and the rural economy should not be underestimated.
The department has highlighted to farmers in the North that when the UK leaves the EU, CAP will no longer apply.
The UK government had previously pledged to continue to commit the same level of cash funds to farm support but the UK general election next week could see a different decision come into play.
According to the department, CAP payments have “a very significant influence on the viability of the industry” in Northern Ireland.
Latest government figures show that farm incomes in the North fell last year by nearly £8,000 a farm to just over £26,000.
Currency volatility
CAP payments are initially set in euro and then converted to sterling using the average exchange rate during the month of September
According to the department, the exchange rate for 2019 is €1 = £0.89092.
Earlier this year the North’s department for the economy said the amount paid to farmers “can be variable due to currency volatility”.
It had estimated that “every one pence move in the value of sterling against the euro changes the amount paid by approximately £3.2 million”.
The department for the economy said that if the average exchange rate in September 2019 was based “on €1 =£0.9155” then direct payments to farmers in the North could have jumped to £293 million this year.
