Jackie Cahill (Tipperary, Fianna Fail) | Oireachtas source

I thank the Minister and his officials for their presentation. The farming and agrifood sectors are looking to next week's budget to see the Government's commitment to the industry. This year has been difficult and farmers are under extreme financial pressure. We had one of the longest winters, a non-existent spring and then the problem of an extremely dry summer. The income level of many enterprises is zero and significant merchant debt has built up over the winter and summer. Cows were fed this summer in the same way as they were fed in January and February. Farmers have large bills and are facing into a winter with inadequate fodder. The cost of fodder has spiralled, as has the cost of concentrate feed. We are in the first days of October but grass growth has stopped quickly or slowed down significantly. This is sending shivers down farmers' spines. Feeding will have to commence at full winter rate quickly.

It is disappointing to be debating the 2019 budget when commitments given in the 2018 budget have still not been delivered. I refer specifically to the low-interest Brexit loans. To still be waiting for them 12 months later is disappointing in the extreme. It is essential that low-cost loans are announced in the budget.

In 2016, when the Minister announced the introduction of low-interest loans I said that not enough money had been allocated to this and that the money allocated would not be adequate to cater to the demand.

There is a huge amount of pent-up frustration among farmers on the issue of credit. The document we have been presented with mentions an interest rate of 5%. That is not a low-cost loan. Bank of Ireland appeared before the committee a couple of weeks ago. It has a loan scheme which offers significantly lower rates than that. The problem with the banks is that many of the farmers who are most in need of credit will not get access to the loans. It happened last time around, when farmers who were under the most financial pressure did not get access to the low-cost loans. Farmers who converted loans they had into low-cost loans were probably benefitted most. Low-cost loans must be a part of next week's budget. Teagasc or another Government agency should have a role to play to ensure that those farmers most in need of low-cost loans get adequate access to it. That is absolutely essential.

Our beef sector is now at a critical crossroads. Men are now making decisions about their futures, and are waiting until after the budget next week to decide whether or not to exit the industry. Factories have exploited the situation this summer by cutting prices without justifying such a move to farmers. That decision had implications all the way down the pricing structure, down to the price of the calf. The beef forum has to be used to bring transparency to the industry and to show us exactly what a side of beef is worth. The price of steers is very disappointing at the moment, given the price of culled cows a couple of months ago. With the price of beef rising in the UK, and our factories dropping prices week by week, it is completely unjustified. The lack of live exports is playing a huge part in the ability of factories to exploit the situation. Funding for Bord Bia to increase live exports is absolutely essential. The closure of the Turkish market at the moment is also a factor. Bord Bia needs extra resources.

The Minister spoke about market diversification. I do not disagree with that sentiment, but in reality, over a 12-month period, how practical is it? Brexit is coming at us very quickly. We can examine how Ireland has been heavily dependent on the UK market over the years, and Bord Bia has always focused on reducing that dependency. However, the dependency has only reduced by a few percentage points over the years. We have other products, notably cheddar cheese, which are only exported to the UK, so while we should try to pursue diversification it will not solve all of our issues.

Next week we have to see an announcement of low-cost loans, a movement towards a €200 payment for suckler cows, and some movement on the sheep sector, particularly hill ewes. These measures are required to restore profitability to the sector. Areas of natural constraint payments have to be further increased in order to bring them back to previous levels. Those payments were cut by Fianna Fáil nine or ten years ago; that does not need to be said. We are where we are, and there is a different economic situation now. Those payments have to be restored.

On the taxation front, the thresholds for inheritance and the transfer of family farms need to be increased. Agricultural relief has to be maintained at its current level, and the taxation incentives in place, whether stock relief or stamp duty exemptions for young farmers, are all absolutely essential. I cannot stress enough how important next week's budget is. Farmers are looking to the budget to see if there is a serious commitment to the sector. Men are making decisions about their futures.

I have met individuals in the past couple of months who have never thought of ceasing the farming enterprises in which they are involved. However, they are thinking about doing so now. They wonder if there is any commitment to their sector, and they might move away from it.

A small number of farmers are involved in the pig sector, but it is under huge pressure. Farmers working in it will need low-cost loans to survive. They are caught in a perfect storm; there has been a severe drop in pig prices while the price of inputs have increased dramatically. The sector does not get much media attention, but it is under huge pressure. It is an important industry for the country.

Rural Ireland will look anxiously at next week's budget. It wants to see a commitment to different sectors, and a commitment to keep profitable farming in place, whether dairy, beef, grain or pig. All sectors are under huge financial pressure. Next week's budget is hugely important.