ICMSA lashes ‘undermining effects’ of discretionary bonuses on Base Milk Price
THE President of ICMSA has again criticised what he said was the ‘undermining effects’ of discretionary bonuses or payments on Base Milk Price. Pat McCormack said that the association was ‘unhappy and suspicious’ of the practice that saw Co-ops paying a Base Milk Price that was below that of the Ornua PPI which was then ‘ topped up’ by a cent or two on grounds of ‘Hardship’ or ‘Loyalty’. Mr McCormack said that ICMSA rejected the idea that paying any element of a proper, market-derived milk price could be ‘discretionary’ and he insisted that farmers wanted to be paid a proper price for their milk because that was what it was worth and not ‘at the whim’ of the processor who they were supplying.
“We do not accept the idea that re-calibrating a minimum Base Milk Price and dividing it into elements that are market-derived and discretionary stands up to any scrutiny at all. This months’ milk price announcements are a case-in-point. The Ornua PPI translated across to 32.1 c/L and remember that this is the price already achieved, why then do we have milk processors announcing a Base Milk Price below the PPI and then announcing a ‘Bonus’ as if they were doing their suppliers a favour? Their milk suppliers don’t want or like the impression that they’re standing in front of their Co-op with their ‘caps-in-hand’ waiting for the proper market payment at the whim of the processor; what they want – and what they’re entitled to – is at least the same price-per-litre that the processor was paid for their products. The fact that farmers are in very serious straits regarding cash-flow and soaring costs actually makes this practice worse: it’s as if the farmers are being put in the position of ‘ hired hands’ who should be grateful to be getting as a bonus what they should be getting as a right. ICMSA is very conscious of the kind of financial vice-grip that thousands of farmers are in and we know that every cents counts. But we’re not fooled at all and we reject and resent this insidious practice of shorting farmers on their proper price and then then announcing a ‘ top up’ discretionary payment that brings it up to what it should have been in the first place”, said Mr McCormack