Official Report: Minutes of Evidence

The Chairperson (Mr Butler): I now welcome the following representatives to brief the Committee and answer any questions: John McLenaghan, Ulster Farmers' Union (UFU) president; Clement Lynch, UFU deputy president; Ms Ellen Moorehead, the NI regional coordinator for the National Sheep Association (NSA); Mr Edward Adamson, secretary of the National Sheep Association; and Kellie McEvoy, UFU beef, lamb and hill policy officer. Thank you very much for your attendance. The floor is yours.

Mr John McLenaghan (Ulster Farmers' Union): Thank you very much to the Committee for the opportunity. For a long time, as the Committee will be well aware, we have argued for more money to support the farming sector. We refer to the fact that the money that we get — the ring-fenced budget of approximately £330 million — has never been inflation-linked, so it has decreased over time. The amount of money for resilience payments to farmers has naturally eroded over time, and we have drawn attention to that. We have always argued that an inflationary link should be put into it. We would absolutely welcome more money for the farming sector. It is essential to build resilience into the most significant and important sector of our economy. We have concerns about the Bill as the measure to do that. Those concerns are not about the need for the money or where it goes; they are purely around where it might come from. We can easily support the principles of areas of natural constraint (ANC), provided that we are assured that the money is additional to the pot of £330 million and that there is absolutely no chance that some of it might be sliced from that £330 million, which is essential to the wider agriculture economy.

That is where we are coming from. We welcome the opportunity for more money to come into our industry. It is very much needed, but we have a concern that, if it just takes from Peter to give to Paul, it will not benefit our industry at all and will only create further problems of distribution. We argue that, when we have the money, we should sit down as an industry — there are good representatives of the industry here — and say, "This is the pot of money; this is what has been secured; this is where it has come from; this is what we know it is going to be in the future", and then go through a consultation and co-design piece about how we get that distributed to where it is most needed.

The Chairperson (Mr Butler): Thank you. Are there any other points?

Ms Kellie McEvoy (Ulster Farmers' Union): Good morning, everyone, and thank you very much for inviting us along today. We are the UFU, and the NSA is here with us; both organisations are part of the Northern Ireland sheep industry task force. Clement is chair of that group as well. We are here to represent the UFU and NSA view and position on ANC. First, I will outline the joint organisations' position, which is that we support the ANC Bill in principle and appreciate the recognition of the need for ANC support. However, the UFU and NSA position, as John said, is that any funding for ANC payments must satisfy a clear additionality test. The Department must demonstrate that the introduction of ANC payments will be funded through either additional Executive resources or the reallocation of DAERA funding from outside the direct farm support budget. Under no circumstances should ANC funding reduce, delay, top-slice, displace or otherwise diminish any existing or planned support for farmers. Any proposal that fails to meet that test will simply redistribute financial pressure within an already stretched DAERA budget, as John mentioned, and would not meet the UFU and NSA definition of "new money". Should the funding allocation fail to satisfy those conditions, the UFU and NSA would, unfortunately, have to withdraw our support for the Bill.

I will touch a wee bit more on the ANC side of things. As you are all probably aware — I have sat in front of you before about this — sheep farmers in Northern Ireland are losing 17% of their direct support at the minute, with no real prospect of regaining that funding. Take Clement here, who is a sheep-only farmer. He has no option to regain that funding. I am sure that nobody in the room would like to lose 17% of their salary. As John said, it is so important that ANC support come from a pot of money that does not disadvantage anyone else. A really worrying stat is that, in Northern Ireland, our ewe numbers and our total sheep numbers have declined by 11% over the past five years. It is significant for farming and for processors and so on down the supply chain. It has a really dramatic effect on the Northern Ireland agri-food industry and our local economy.

I will now highlight why we support the ANC Bill in principle. If you look at the June 2025 census, you will see that, significantly, the ewes in Northern Ireland are located in severely disadvantaged areas (SDAs) and disadvantaged areas (DAs). In total, 80% of sheep are located in those areas, which are classified as less-favoured area (LFA) ground. However, as a result of changes made in the past to ANC support, DAs were stripped out of that; we are now talking about just SDAs, which represents 60% of the total sheep in Northern Ireland. ANCs have quite a significant impact on a lot of our sheep farmers in Northern Ireland.

I will now touch a wee bit on the benefits of ANC support and why it was there in the past. It supports people who are farming in areas that are constrained by the weather, by soil type or by terrain. The reason for there being 80% of sheep in LFAs is that that is really the only livestock and enterprise that is suited to that land. It is wet, it cannot really hold cattle, and there are shorter summers and longer winters. Sheep are the only thing that is viable for those farm businesses. However, although there are a lot of constraints, sheep farm very well in ANC land. ANCs produce vital breeding and finishing stock for our lowland sheep farmers. Most of our breeding stock come off hill areas because of different hill breeds. They breed really good maternal hardy sheep for our lowland grounds and our finishing stock. That also has an impact on processing sectors further down the supply chain. One of the most important things is that sheep farming brings environmental benefits to ANCs. You increase biodiversity through grazing — your heathers, your grasses, ensuring that other species can thrive in those areas. Then there is carbon sequestration, as well as something that is very significant this year after a very bad spell of wildfires: the important role that sheep play in that. Hopefully, going forward, the importance of sheep and livestock can be really increased. They have such a big role to play in dealing with reducing wildfires in upland areas.

We are here as well as part of the sheep task force. We cannot not mention sheep support, which is ongoing on the sidelines. We have been fighting that battle since autumn 2022 when the task force was first formed. At that stage, the new farm sustainability support came out, and sheep were left out of it. We were really disappointed, which was why the task force was formed. We have been deeply disappointed by how slow the progress has been on that. DAERA only recently created the industry sheep sector support working group, which we are very appreciative of, but we have had only two meetings. We have a further meeting on Monday, but development in that regard has been very slow. To be honest, at the moment, we are probably not seeing what we initially set out to look for. We will continue the conversations and discussions on that, and hopefully something can be achieved. At the moment, however, we are disappointed with how slow the development has been and quite worried that time is running out in the mandate.

That was a very short presentation. Thank you very much for listening, and, if you have any questions, go ahead.

The Chairperson (Mr Butler): Does anybody else want to add anything, or are you happy enough to pick up questions?

Ms Ellen Moorehead (National Sheep Association): We are happy enough to take questions. Kellie articulated our joint position very well.

The Chairperson (Mr Butler): Brilliant.

Mr Edward Adamson (National Sheep Association): I am of an age to remember when ANCs were originally LFAs. I think "less favoured" describes the area that we are talking about farming on. It is just a bit more difficult there.

The Chairperson (Mr Butler): No problem. I appreciate that and the paper that you submitted for us to look over.

If you do not mind, I will first touch on the fact that both John and Kellie referred to: the money. It is probably the most difficult piece to square. I totally understand why you are adamant that it should not come out of the ring-fenced budget, but we have finite budgets. Have you had any thoughts or discussions about where you think that we might be able to get the new money from? Do you think that there should be more money for DAERA, or should it come from within DAERA through reprioritising other things that are going on?

Mr McLenaghan: It could be any of those things. Kellie talked very well about some of the benefits that sheep provide. We looked at the biodiversity gain and the reduction of fire loading that come from sheep grazing. There are arguments for there to be a pot of money that is outside the normal agriculture budget because of the benefits that it brings. We sometimes see that through things such as the Shared Island Fund and all sorts of different funding. There is an argument for that, as it can support those particular areas and the management of livestock on them. We talked a fair bit about sheep support as a mechanism that can deliver for those same areas that we are identifying as being ANCs. There will be mechanisms to do that.

You are also identifying the fact that there is a social need, and that is why we very much welcome the interest in and recognition of the fact that there is a demand and a need in those particular areas. There is a social need as well. It is difficult to make a living in those areas. That is why they were previously categorised as less favoured. "Areas of natural constraint" is perhaps a softer way of describing them. There is a reason for all of that. There is almost a communities piece in it as well to look at how we can preserve the communities in those areas. Again, we would very much welcome the opportunity to sit down and look at how best we could do that, whether that is through sectoral interests such as sheep support or something broader. It comes back to the core point. We would rather start with the money. We would really love it if you had come and said, "We have a pot of £50 million or whatever. How do we bring the experts together? What is the best way to use that to get the maximum benefit for those areas?" If we were doing it that way around, rather than doing it and then going and looking for the money —. The risk is that, if we do not get the money, the only place that it can come from is from the money that is ring-fenced for the whole wider farming industry, and that would create problems by slicing that off. There will be other pots available, Chair. There are lots of other sources out there. I am quite sure that, with a bit of imagination, we can find them.

The Chairperson (Mr Butler): No problem. This was in my head. I was not due to get into it, but one issue that farms face is the average age of farmers and the intergenerational challenge. Is there evidence that says that, in areas such as these, it is potentially even more of a pinch and a struggle? Young people who are looking to take on the farm are, obviously, looking at its sustainability and how it can provide for their family. Is there any evidence to suggest that it is more difficult in areas like this?

Ms McEvoy: We do see a decline in farm businesses in our upland areas. You only have to take a drive through the Sperrin mountains to see the number of abandoned homesteads where it has not been viable for young people to stay at home and farm. Loads of young people would love to do it but, financially, the option is not there to have a family and stay. You see a lot of land. We are both from the Sperrins, and you see generations dying off.

The Chairperson (Mr Butler): That leads me into another one, if you do not mind. The reduction in the number of sheep everywhere across was mentioned in your paper, and it jumped out at me. There is obviously a market pressure, or maybe there is not. I do not know. If there was a sheep support scheme or an ANC scheme, would we produce more sheep? Is there a market for more sheep, or are we just looking at the sustainability of the scale that we have at the moment, and an additional support is required to support that?

Ms Moorehead: There would not be a massive jump in sheep numbers, but we would like to sustain a healthy number of sheep in Northern Ireland. You only have to speak to the Northern Ireland Meat Exporters Association (NIMEA); it is concerned about the potential for plants to close because there might not be enough throughput, and no farmer wants to lose another processing site.

The Chairperson (Mr Butler): But a demand for lamb is there.

Ms Moorehead: Certainly. There is absolutely a market for it. Kellie noted the 11% reduction in sheep numbers in Northern Ireland. The reduction is only 4% across the other devolved nations, because they have viable sheep support mechanisms in place which makes it more sustainable for farmers to maintain sheep farming and address the market. There is a market demand for our sheep industry, but because we do not have the additional support, be that through a sheep support or ANC scheme, we have seen a reduction of 11% in Northern Ireland.

Mr Adamson: Kellie mentioned the difficulties with young people. The areas are not easily farmed, and the more people we lose, the more difficult it becomes to be a viable hill farmer. Some of those farms are abandoned. We all like to drive round the countryside and view the scenery, but it has to be managed to keep it like that. If there is nobody left, it will not be managed.

Mr McLenaghan: Losing the people is one thing, but there is a thing with the sheep, too. Over generations, they learn which hill is theirs, and once that is gone, you cannot suddenly decide, in a few years' time, that it would be good to have sheep to reduce the fire loading and save millions of pounds in biodiversity loss and everything else — "Let's put some sheep on there to graze it". You cannot do that, because the sheep that know where to graze are gone. There is a continuity argument around all of that. If we identify that it is a good thing to have grazing livestock in those areas to help to manage and control them, plus all the benefits that they bring socially for the communities and everything else, the question is how we best support that, recognising that it does need support. That takes us into the two different proposals that we have highlighted here: a direct sheep support payment or an ANC payment. Either way, it needs to be additional money.

The Chairperson (Mr Butler): This is my last one. Obviously, the payment will not be for all sheep farmers; it will be for those in areas of national constraint. Is there any difficulty or any challenge in conversations with other sheep farmers of any scale in any other jurisdiction who will not qualify for the support payment?

Ms Moorehead: Absolutely. That would definitely be a difficult conversation. Kellie has mentioned the numbers already. If we are including what the Bill is saying at the minute — SDA areas — that covers 60% of sheep numbers in Northern Ireland. If that was extended to cover DA numbers, 80% would be covered in the ANC payments. We all sound like a broken record on this side of the table, but this would need to be new money. The payment would need to be additional to the sheep support scheme that we are already in conversations with DAERA about, and that would provide a subsidy for all sheep farmers in Northern Ireland.

The Chairperson (Mr Butler): In terms of the commercial matrix of a sheep farm that is not an area that will qualify for both payments, will that create a difficulty for farmers in those other areas? Does it just bring them up level, or does it make it more difficult for someone —.

Mr Adamson: Not all of our land will qualify for the payment, but those who farm in better areas understand that life is easier for them. I represent the sheep sector, and there has been a lot of talk about the sheep sector. The area that we are talking about is a more awkward area to farm on. If you are in that area, life is not just as simple. I do not think that it would cause grief with lowland farmers.

The Chairperson (Mr Butler): This is not just about sheep.

Mr Adamson: It is not just about sheep.

The Chairperson (Mr Butler): That is the thing. We have to remember and come back to the fact that this is not just about sheep.

Mr Adamson: I have admitted that. It is not about sheep. It is my sector.

Ms Moorehead: It is linked to the land as opposed to the livestock.

Mr McLenaghan: Our organisation represents sheep farmers on hill land and lowland, and I know that lowland farmers have said during discussions that they feel that, if the payment went to somebody doing the same thing on a hill, it would be unfair. We have to represent that view as well.

Ms McEvoy: That is where the new money is crucial.

The Chairperson (Mr Butler): Yes. Thank you.

Mr McAleer: There are so many things that I could ask. I nearly feel as though I am on the wrong side of the table.

On the last point, you are right: it is not just about sheep. However, it is important to point out that sheep farmers have been impacted on the most, because your funding has been slashed to pay for beef schemes and protein schemes that you cannot avail yourselves of. You are being completely shafted through the loss of all that funding. To support what John said, there are very compelling social, environmental and agricultural reasons. This is the breeding ground for our red meat sector in the North. One million of the 1·8 million sheep here are in ANCs, and 1·4 million of those 1·8 million sheep are in LFAs, and the majority of our beef stock is there. That is the very start of our food chain, yet those very areas are completely underfunded and not supported. That has historically been the way. You will know that, when the farm entitlements began in 2005, your entitlements were lower than those for other farmers, because, given your natural constraints, your stocking density was lower, so your historical production levels were lower. You have therefore always laboured with below-average single farm payment entitlements. That was then compounded by the loss of the ANC scheme and having no sheep scheme. It is incredible that the area is even surviving. If it keeps going the way that it is going and does not survive, that will have a trickle impact on the entire farming ecosystem. That is really important. The cost of not doing it — even environmentally, with wildfires and conservation grazing — is far, far, far greater than the modest amount that it would take to fund the scheme. That is where I am coming from.

I got this through a question for written answer: 60,000 additional hectares — 155,000 extra acres — are now eligible for single farm payment, and 60% of that land is in ANC areas, but there are no entitlements for those. That proves that lots of your farmers are farming land that they cannot even claim single farm payment for, never mind having entitlements below the regional average. A cost of £11 million is small fry compared with what you have been losing over the years and the wider impact on the entire agri-food ecosystem going forward. I feel very strongly about this. It is also important to point out that there is no financial cost to the Bill, because this is enabling legislation. The detail of the funding will be agreed by affirmative resolution by all parties in the Assembly, and the statutory regulations will be made in the next mandate. This Bill is effectively about setting the foundations of the house, if you know what I mean. The detail on the funding arrangements will be thrashed out. I think that all parties agree that we do not want any further cuts to the farm budget.

I will ask a question instead of just making comments. I know that some sectors, such as dairy, were not included in the last scheme. Do you think that, going forward, the scheme should focus on the land and the limitations? The Bill is about giving a legislative framework to the most recent scheme, but, going forward, are there any tweaks or changes that could be made to make it more effective?

Mr McLenaghan: I will start. Declan, you are absolutely right. I suppose that is the point. If we knew how much money we had, and if we knew that that was guaranteed going forward, we would welcome the opportunity to sit down and design a scheme in order to get the most out of it, to make it as effective as possible and to deliver on all those things that we have talked about. Should dairy be included? That would be part of that discussion. Of course we would be part of that, and various stakeholders would contribute to it. We need to start with: "Here is the pot of money. Here is what we are sure about. Let's now design a scheme that delivers all the things that we have all identified that we need to deliver for".

Mr Adamson: I have already mentioned that there are areas of natural constraint, there are less-favoured areas, and no matter what enterprise a farmer takes on board in those areas, it will be more difficult. I do not know whether we can start defining at this stage if you say that it is an area that is harder to farm on.

Mr McLenaghan: It was difficult to justify why dairy was excluded the last time, to be honest. As Edward said, there was no real reason. That would be part of good co-design to sit down, discuss it all, work it all through, take views from the dairy industry and from people who are in those areas to get a better understanding of all that, and go forward with the evidence base around what it would look like.

Mr McAleer: Hopefully we will get a chance to debate the statutory regulations in the new mandate. That is the sort of stuff that we can flesh out. That is it from me. Thanks very much for coming up, by the way.

Mr T Buchanan: Thank you for being with us this morning. Being from the hill country and having farmed sheep in my earlier days, I fully understand the arguments that you are putting up here today. Everyone is saying the same thing: "It has to be new money. It cannot come out of the budget that is already there". But I am still not clear where the money will come from. We hear you saying, "Take it out of a pot here" and, "Take it out of a pot there", but I am still not clear about where you see the money coming from. If the Bill goes through in its current form, it does not just sit there. It means that the money is going to have to come out of the £330 million. There is no other way around that, but everybody is saying that we need new money. Can you give me some clarity today around where you see this new money — we are talking about £11 million — coming from to cover the ANC payments?

Ms McEvoy: To go back to our wording, it would have to be additional Executive resources or reallocation of DAERA's funding from outside the direct farm support budget. The £330 million or thereabouts is the direct support, and the wider DAERA budget is £600 million.

Mr Adamson: I do not have an answer for you, but, as a sheep farmer, I have seen the beef sector getting money, and we lost out a bit. I do not know where you are going to get it from. You should be in a better position to find it than we are. It is not on to take it from one sector to give it to another. Farmers are in this business together, and to start taking from one sector to give to another is not the way to go.

Mr T Buchanan: Looking at it from that scenario, are we saying that, if new money cannot be found, we will let it sit?

Mr McLenaghan: We have been clear that if new money cannot be found, we cannot support the Bill as it currently stands.

Mr Clement Lynch (Ulster Farmers' Union): Can I just say that, as a sheep farmer who has lost 17% of his basic payment, I look at the cost of TB, which was an additional £10 million this year. That money can be found. From a farming point of view, as far as we are concerned, we see very little work being done to try to deal with TB. So there are pots of money in the agriculture budget that can be found for other things, and sheep farmers are probably a bit aggrieved that money cannot be found for us.

Mr McLenaghan: Yes. That is a good point. This year, probably £70 million will be spent on treating a disease that we could get on top of, had we the will to do so. There is a massive saving to be made. We will not save £70 million in year 1, but we will start to save it pretty quickly, so there is an example, possibly, of where funding could come from.

Miss McIlveen: Thank you for your presentation. Obviously, I welcome the much clearer statement today, which was, perhaps, absent in advance of the Second Stage debate. We might not have been in this room today discussing the Bill had that statement been there at that particular time.

As you would understand, I do not necessarily agree with Declan's hope to be in a place where we are looking at statutory regulations and co-design at that time. We should be looking at co-design in relation to support, be that ANC support or sheep sector support, at this point, rather than looking at this legislation, but we are where we are.

I support our getting support for the sheep sector. I have spoken to the Minister on a number of occasions in relation to that. Our team met the Minister and officials last week. Part of that discussion was on the scheme, and I am a little bit more positive that there is some traction as regards that. I am concerned, though, about what Kellie said about the content of the scheme and what you need to see. I would appreciate your going through some of that.

Ms McEvoy: The discussion is closed and in confidence in those sheep meetings, but we can give you an outline. We are just disappointed, I suppose. We are only on our third meeting, and it is June now. Summer months are about to start. We will not be back until September, and a number of things will have to happen. It is fair to say that what we were shown in our last meeting was not what we set out in our sheep task force document. It is very different. The structure of payments is very different, so we have a lot of concern, as we have not seen any figures on what that would actually mean financially. We are quite reserved, at the minute, on how we see that sheep support going forward. We would need a lot more information. Hopefully, we will get that from DAERA on Monday.

Miss McIlveen: OK. Obviously, any financial support that would be given to the sheep sector would also come out of the current — I am guessing — £330 million pot.

Ms McEvoy: At the minute, we have been given no direction on that. Obviously, we would also like to see the financial side of it, and we have the same issues with the ANC as well.

Miss McIlveen: OK. Obviously, other supports have to come from that £330 million, so I am guessing that something similar will be done regarding sheep sector support.

Ms McEvoy: Yes.

Miss McIlveen: The question in relation to that is whether there is broader support in the UFU and the Executive around that. Obviously, again, we do not want the criticism that we are robbing Peter to pay Paul.

Mr McLenaghan: Yes. I will come to the second bit, but on the first bit — where does it come from? — you are quite right. We have also seen that the beef carbon reduction scheme was taken through the national envelope mechanism to support and drive behavioural change to reduce carbon emissions from our beef industry. It has been successful in doing that.

We have also seen new moneys found. New moneys for the soil nutrient health scheme, a significant programme. New moneys were found for the genetic programme. New moneys were found for the carbon calculator, totalling £40 million or £50 million in total. I am not quite sure. Do not quote me on the number. We have seen it in those sorts of broader, cross-cutting type of measures. We have seen the ability to bring new money into the sector without having to take it and slice it from the resilience payment that goes directly to farmers and is essential to those farming businesses.

The second part of your question was about a UFU position regarding the payments. It is something that we discuss. We are an organisation that is often described as a very broad church, as you know, Michelle. We represent many different sectors. We have a democratic process, and within our organisation, we go through that process through our committees. It would probably go through quite a number of our committees, actually, because it cuts across nearly everything. Then, it would go up to our executive, as you rightly identified, as the body that would make the decision. We would have a discussion and debate at our executive, and that would set the direction for the UFU policy in that area. We have not had the chance to do that, but we would have welcomed the chance to do so, had this been timed differently.

To go back to the original point, there is good, strong evidence of the ability to bring in additional moneys to drive the whole industry forward, and we see this as just another example of that.

Miss McIlveen: I would be supportive of that support, given that the area that I represent does not have ANCs. From that perspective, I am representing farms in my area. I welcome your contribution today. It has been really helpful, so thank you.

Mr Blair: I think that Michelle already alluded to this, and I understand that there will be restrictions on what we can talk about, but I am going to try — Kellie please be patient with me — to have another go. I respect the confidentiality of the task force process, but the presentation also tells us that apart from the work that has been going on from the autumn of 2022, work has been going on for many years by the Ulster Farmers' Union, in all sorts of sectors, of course. More generally and strategically, if help was available in the future, or if a new strategy or funding package came forward, could the funding targeted in the ANC Bill be tackled through any new forthcoming support to address the need identified in the Bill?

Ms McEvoy: If what we are seeing at the minute is not the right sheep support, I would probably have to say "No" at the minute.

Mr Blair: OK. I guess that you cannot go into more detail about what —

Ms McEvoy: We are at the very early stages of that. We are only on our third meeting.

Mr Blair: Just to confirm, although other panel members might need to do that, I fully accept, as all of us will, that £330 million is a significant sum in respect of the departmental budget. It is a small amount compared with the overall funding floating around the sector when you are counting it in billions — seven or eight billion, perhaps — as well as the profits of companies and various other factors regarding finances. I am assuming that, prior to the commencement of the task force in autumn 2022, a significant amount of work had been done by the UFU that would have included engagement with the sector. I ask that just to get it on the record.

Ms McEvoy: Yes. Ourselves, NIMEA and the Livestock and Meat Commission (LMC) put a lot of money into a report in 2020, which was before my time. The report outlined a need for sheep support, suckler cow support and beef support. It also touched on ANC. Clement, you might have been about when that report was being developed. A lot of what the report produced was picked up in what was to become the farm sustainability payment scheme. Disappointingly, however, sheep were not included.

Mr Lynch: Sheep support was in our proposal to the consultation.

Mr Blair: In 2020?

Mr Lynch: Yes. That was the only ask that we had that was not addressed.

Mr McLenaghan: I was part of the agricultural policy stakeholder group (APSG) programme when I came into the role that Clement is now in. At that stage, we were talking about the need for sheep support and the fact that it was missed in the original design of that future support. All of a sudden, there was the ability to shape our own destiny with regard to support. We were free from European rules about what that needed to look like, and we had the ability to do it ourselves. It was a new thing for us to do, and I suppose that we were learning. A mistake was made and identified six years ago that sheep were missed out, and that needed to be rectified. It is not right that it has taken this long to rectify that, and everybody is saying that it still needs to be done.

The ASPG ran for six years. The third meeting of the sheep sector support group is coming up, so it is quite early days, but, hopefully, it will get a wee bit of a reset and get back on a better path. We do not need to keep talking about these things. We know what is needed; we know the benefits, many of which have been mentioned, so we just need to get on with it.

Mr Blair: That helps. Thank you.

Mr Adamson: The NSA is specifically trying to support the sheep sector. We have seen from the very beginning that it looked like the sheep sector was going to be left out, and it was. We are here with the union today, and we can agree on that.

Ms Murphy: Thank you all for coming to brief us. I was born and bred in County Fermanagh, where 92% of our land is ANC territory. From engaging with local farmers, I know that every one of them very much welcomes the Bill and the added support that it can give them.

I want to touch on the costs, more as a point than a question. In December 2025, the Department had £11 million in reduced requirements. Recently, in January, there was an announcement — the consultation is ongoing in June — of £50 million for the Shaping Sustainable Places programme over a 10-year period. I very much welcome that. My main point is that there is money there that has not been used due to reduced requirements and the fact that money can be found. That has been proven through the likes of Shaping Sustainable Places.

Kellie, more broadly on rural areas, rural communities and the rural economy, you referenced the Sperrins and some of the land that has been left by farmers who could no longer farm due to the financial constraints around this as well as the land in question. How important is the Bill for re-energising some rural communities as well as putting them on a level playing field, as much as that is possible?

Ms McEvoy: Like any business, if the profitability is not there, it cannot be sustained, and that has happened with a lot of those upland businesses. The business was just not financially viable. In the past, ANC was there to provide that bit of additional income to support it, including with additional costs that you might have because of your land constraints. On the community side, for every farmer that you lose, you will probably never get another farmer to replace them. That has a knock-on effect on local communities, shops and so on, and that is devastating. You only have to drive around the countryside to see the number of rural schools that are no longer open. As everybody has discussed today, there are many more challenges with farming in those areas, and the ANC payment was there to give a little bit of additional support to help farmers because you cannot do anything about the constraints on your land.

Mr Adamson: In the sheep sector, the natural scheme of things is that those hill areas produce good, hardy, healthy stock that is very necessary to feed down through to the lowland area to help the breeding flock. The more that disappear from the top, the more difficult it will be to get good-quality maternal breeding stock to keep the whole sector going.

Mr Lynch: Sheep prices have been good in the past couple of years, but prices for hill sheep have declined. Maybe breeding stock is still a good trade, but two years ago, store lambs were a poor trade. Last year, the average price for blackface lambs was maybe £5 or £10 a head. That forced a lot of farmers around me to finish those lambs rather than take bad prices for them. Then, we had the bluetongue scare, and that distorted the market badly for a number of months. Most of the people who fed lambs and finished their lambs from a hill area, including me, found that it cost them money. I finish all my lambs, but this year, my hill lambs cost me money to finish them.

We are probably in decline in all areas. The best example that I can give you is our local market. This is off the subject of sheep altogether. Tom will know well where Plumbridge market is. A few years ago, it had six calf sales a year, and there were so many coming into the market that you had to book your calves in. Now, I am told that the number of calf sales is down to four, and none of those sale days is full. They can sell around 300 calves in the market, but there is no day when the full number of calves is sold. That just shows the decline in the number of cattle in those less-favoured areas.

Ms Murphy: I think that you would all agree that that raises wider concerns about the supply chain itself and how that trickles down.

Mr Lynch: Yes.

The Chairperson (Mr Butler): I will let you back in, Declan. You said that it would just be a little one.

Mr McAleer: I have a question that I meant to ask. I am just thinking of the level playing field again. There are ANC schemes in Scotland, Wales and the South of Ireland. There is a moorland scheme in England, I believe, for marginal land as well. Therefore, this is the only part of these islands that does not have some sort of support scheme for farmers in marginal land. Does that place us at a competitive disadvantage to our counterparts across the water in Britain and in the South of Ireland?

Mr McLenaghan: Yes, Declan. We should have a scheme that is exactly like those that you have described in the other areas. There is no question about that. Marginal areas need additional support; it just needs to come from a new pot of money. We do not have enough wealth in the industry to take it out of the existing pot. If we can get that new pot of money, we can all sit down and design what that scheme looks like. Absolutely. Of course, we should have it, yes.

Ms Moorehead: It goes back to my earlier comment as well, Declan, about ewe numbers. Kellie mentioned the 11% in Northern Ireland. That is a similar scenario. We do not have that ANC payment here in Northern Ireland to support our farmers in the disadvantaged areas. We do not have sheep sector support here either. Therefore, it is a double whammy, if you like. In all those other devolved nations, the industry has both of those payments. How are we ever going to compete?

Mr McAleer: Absolutely.

The Chairperson (Mr Butler): Michelle has promised me that her question will be a wee one.

Miss McIlveen: It follows on from that last point that you made, actually, about the two payments: the ANC payment and the sheep sector support. In the environment of incredibly tight budgets in which we live, which is your preference? What is your priority at this stage?

Mr McLenaghan: It is difficult to say, Michelle. I am not going to avoid your question, but I think that we would need to sit down with the industry and design what that looks like. Our colleagues from NSA may have a sheep sector preference. We represent the wider industry. If we are at that point where you say, "We have secured a pot of £20 million. How can we best use that in our upland areas, areas of natural constraint, Fermanagh land, or whatever it happens to be? How can we best spend that?", we will very quickly get a plan together.

Miss McIlveen: In the absence of an additional pot — you have put a figure on it of £20 million — in today's current climate, what is your preference?

Ms McEvoy: I suppose that it comes back to the point that the sheep support would have to be the right sheep support. We would really struggle to support something for which there would be no uptake. If we were to go back with a sheep support scheme that farmers did not like, we would be seen in a bad light for going ahead with something that was not actually going to deliver for the industry. That has to be right before we can really answer that question.

Ms Moorehead: On that point, too, Michelle, it is very difficult to have a preference between the two very different things that we are talking about here. ANC is linked to the land. It could apply to various wide-ranging industries — dairy, sheep, beef or whatever it might be — whereas the sheep sector support that we are talking about would be direct payments for our sheep industry. Therefore, to have a preference between one or the other is very difficult because we are looking at payments that are linked to land against payments that are linked to an industry.

Mr McLenaghan: As well as that, Michelle, we do not know enough about either to make a comparison. That is the problem. Whether it is land-based or sector-based, we would need to see the two options. We do not really know about either of them at this stage.

Miss McIlveen: The fact is that the conversation has conflated both, and I suppose that it is about looking at where the preference would lie in the absence of new money. Given the fact that a sustained effort has been put into the sheep sector in the past number of years, as opposed to making the argument for ANC, I suppose that I am gauging that the priority — without your saying it — would seem to be the absence of support for the sheep sector.

Mr McLenaghan: It goes back many years. At least six years ago, we identified that the sheep sector was missed out in the future support payments. We have to rectify that.

The Chairperson (Mr Butler): This is the final one. NSA sheep farmers have lost 17% of their direct support. What is that figure?

Ms McEvoy: Money-wise?

The Chairperson (Mr Butler): Yes.

Ms McEvoy: Fifty million pounds. That is £24 million to the beef scheme, £25 million to the suckler scheme and £0.5 million to the protein scheme.

Mr McLenaghan: That followed a national envelope and EU criteria. You could take so much and allocate it specifically.

Ms McEvoy: That was under World Trade Organization rules.

Mr Lynch: On that point, most other areas can probably diversify. If you produce cereal, you probably have better land. In the majority of ANCs, the scope for diversification is limited.

The Chairperson (Mr Butler): You cannot crop it.

Mr Lynch: That is right.

Mr McAleer: From the data, in all the ANCs in the North, there are only 10 cereal farmers. That tells you how difficult it is to diversify.

Kellie, you said that money went to the suckler scheme. Is that the entire beef scheme or just the suckler scheme?

Ms McEvoy: The beef carbon reduction scheme has two elements: there is the beef scheme and the suckler cow scheme.

Mr McAleer: I have heard that suckler farmers are having difficulty because the vast majority of that funding benefits the other scheme, so sucklers are under pressure as well. It would be wrong to pit the beef farmers against the sheep farmers.

Mr McLenaghan: Absolutely.

The Chairperson (Mr Butler): Thank you very much. That was very useful. I am sure that we will hear from you again.