Brendan Smith (Cavan-Monaghan, Fianna Fail)

On the Deputy's last point, we could not concur with all the report's recommendations. However, the Department is formalising a response to the joint committee. A number of issues raised in the report simply cannot be addressed. The Deputy quite rightly raised the possibility of the indexation of payments which has been a source of concern to a large number of farmers. That issue has been raised repeatedly with the European Commission by the previous Minister for Agriculture and Food, Deputy Walsh, the Minister, Deputy Coughlan, and myself. The European Commission has consistently rejected this approach on legal grounds.

The Deputy mentioned force majeure and the national reserve. From an early stage in the negotiations leading up to introduction of the single payment scheme, the Department was conscious of the possible implication for retired farmers who had leased their holdings. The Department set out to ameliorate some of those difficulties. Participants in the 1994 scheme of early retirement from farming who had retired before the reference period in 2000 are not in a position to claim entitlements under the single payment scheme. One concession that was negotiated by the Department with the European Commission will allow family members who take over a holding that was leased to third parties during the reference period to have access to entitlements from the national reserve. This will be of substantial benefit to family members of retired farmers who decide to take up farming.

The Deputy also referred to the social welfare issues mentioned in the report. When the farm retirement scheme first became operative, the social welfare old age contributory and non-contributory pensions were not as attractive as they are today. That issue could not be addressed by the Department of Agriculture and Food. However, ongoing contact is taking place between officials from the Department of Agriculture and Food and officials from the Department of Social and Family Affairs. We are conscious of difficulties that have arisen for some people participating in the early retirement scheme. As the Minister, Deputy Coughlan, mentioned at yesterday's meeting of the Select Committee on Agriculture and Food, a broader analysis of the future of the early retirement scheme will be needed. She invited comments from committee members on the future operation of the scheme.

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