Farmers' chief urges caution on CAP guarantee

The replacement subsidies will run until at least 2020 allowing farmers some degree of financial certainty after the UK begins the process of leaving the EU.

Some science and infrastructure projects will also benefit from Treasury payments – which could cost up to £6 billion a year – if they were EU-funded initiatives signed off before the 2016 Autumn Statement.

UFU president Barclay Bell described the Treasury’s announcement as “positive news for agriculture,” but said the continued production of world-class food was dependent on support beyond 2020.

Mr Bell also said the main focus must now turn to a follow-on package – and a “clear commitment” from Westminster.

“How this is shaped and implemented will decide the future of agriculture in Northern Ireland. We know that the present CAP package will run the course of the anticipated UK exit from the EU and that the four future rounds of payment to 2020 will be delivered,” he added.

The UK Government position was set out in a letter to the devolved administrations from Treasury chief secretary David Gauke.

Responding to the statement, Agriculture Minister Michelle McIlveen said she welcomed the “firm commitment” to maintain the current level of CAP support for four years.

“This removes much uncertainty and creates time in which to develop a new approach to domestic agricultural support. I know that some will ask what comes beyond 2020, but that was a question we were facing within the EU anyway. At least we now have an opportunity to shape a support regime that is more suited to our needs and one that is not over-burdened with unnecessary bureaucracy.”

Ms McIlveen added: “Overall, the announcement by Treasury is the first tangible step on our journey towards EU exit post the referendum as far as agriculture is concerned.”

Ulster Unionist finance spokesman Philip Smith MLA said the NI Executive must seek “immediate clarity” from the Treasury on a number of questions.

“While the Treasury letter maintains the status quo for certain funding streams until Brexit, it does suggest that EU funding, including that for agriculture, will change once the UK leaves the EU.

“The Northern Ireland Executive must press now for the best deal for local farmers, businesses and universities due to our unique situation.

“This letter is an inauspicious start to any negotiation process. It does not instil confidence in the capability of the Executive parties to influence Westminster when major funding programmes appear to be left up in the air with no long-term commitment. The Executive needs to up its game.”