Éamon Ó Cuív (Galway West, Fianna Fail)

I thank Deputies for contributing to the debate on the deadline of 31 December 2008 for completion of work under the farm waste management scheme. The importance of the scheme has been well demonstrated by the number of Deputies who have contributed to the debate.

Regarding the timely issue of payments under the scheme, all farmers who complete approved works in accordance with the terms and conditions of the scheme will be paid. Deputy O'Shea raised the issue of payments. I reassure Members that by the end of next week, the Department will have issued payments in respect of all approved payment claims up to and including Friday, 10 October 2008. The payments will be kept up to date now that the Supplementary Estimate has been made available.

This will result in expenditure of approximately €377 million under the scheme in 2008, compared with €114 million in 2007 and €21 million in 2006. By any measure, this is a significant level of investment by the taxpayer and represents a strong vote of confidence in the farming sector. Substantial expenditure will also be incurred in 2009 under the scheme when all payments have been made. The scheme will dramatically modernise the agricultural infrastructure.

The deadline of 31 December 2008 for completion of work under the scheme has to be considered in light of the overall agreement secured by Ireland with the European Commission. Members will be aware the nitrates directive posed particular difficulties for Ireland as a result of a finding by the European Court of Justice in 2004 that Ireland was in breach of the terms of the directive. It was recognised that a very substantial body of investment needed to be undertaken on farms in order that Ireland would comply with the higher environmental standards required by the directive.

Deputies Jimmy Deenihan, Seán Sherlock and Brian O'Shea referred to the ICMSA proposal that a legally binding contract between farmers and the Department to complete all work under the scheme would meet state aid requirements and allow for an extension of the deadline. The position is clear on this — the deadline must be maintained. In correspondence, the Commission stated the applicable state aid rules appear to deny such an extension. It also pointed out that the deadline granted was an exceptional one, taking account of Ireland's specific situation.

The revised farm waste management scheme, introduced in March 2006 following a wide-ranging consultative process, was the driver which enabled farmers to tackle substantial levels of investment required. The changes included an increase in the standard grant rate from 40% to 60%, with a grant rate of 70% in the four zone C counties of Cavan, Donegal, Leitrim and Monaghan. It gave additional support for young farmers; an increase in the maximum eligible investment ceiling; and removed the minimum income requirement from the scheme so that all small farmers could participate. For the small farmers on the west coast, that was an important and welcome measure.

As Deputies acknowledged, the scheme has been a tremendous success, with 48,580 applications received from farmers. This led to 46,132 completed application forms from farmers prior to the closing date. Some 42,500 approvals to commence work under the scheme have issued to farmers, with the balance being accounted for by withdrawn applications, failure to secure planning permission or the receipt of multiple applications from a single farmer.

Some Members suggested that between 10,000 and 12,000 farmers would not be in a position to complete works under the scheme by the deadline. However, we know that time and again where a large number of applications are approved, only approximately 80% complete the scheme. In the case of this scheme, 80% of 42,500 approvals is approximately 34,000 job completions. To date, 31,000 farmers have confirmed they have started work. We must encourage the remaining 3,000 farmers who were likely to complete the work in any case to complete it by the deadline.

By creating false expectations that there may be an extension, some people may hold back whereas if they began work now, they could complete it within the deadline and draw down the grant. We know that in Ireland, particularly rural Ireland, when a deadline is in place, people have a habit of going right up to it. There are many builders willing to work. There is a great ability in Ireland to meet a deadline on the last day. I encourage those farmers who are anxious to proceed with their works to get them completed and draw down the grant. The moneys are in place to pay any farmer who complies with the scheme by 31 December 2008.

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