Shane McEntee (Meath East, Fine Gael) | Oireachtas source

From the outset of this budgetary process, the Government was determined to build on the progress achieved in recent years in developing the agrifood sector and in particular to further contribute to the future growth and prosperity the sector can achieve for Ireland in expanding its revenue base through growth in export earnings. The Exchequer contribution to the Vote of my Department in 2013 will amount to approximately €1.25 billion. Although constrained by tight budgetary disciplines imposed right across the economy, which originally demanded a reduction of €114 million for next year, the Government was determined to minimise the impact of the scale of the reduction in order that the most important schemes and programmes upon which the sector relies most were protected to the greatest extent possible. I am pleased to state that through re-orientating and re-scheduling payments, the Department of Agriculture, Food and the Marine has managed to fund new schemes and programmes, while also reducing the scale of savings to a lower amount of €89 million compared with 2012, while protecting farm incomes.

The 2013 budget reflects a significant Exchequer commitment of support for the agrifood sector and is recognition of the contribution the sector can make to economic recovery and future growth. The voted expenditure for 2013 of €1.25 billion is comprised of approximately €1.057 billion in current expenditure and €193 million in capital expenditure. The downward budgetary movement between 2012 and 2013 of €89 million reflects lower budget requirements for a number of measures. The Department was particularly pleased to secure an increased capital allocation in 2013 of approximately €25 million from the Department of Finance in a period of very scarce resources. This enables a meaningful capital programme to be undertaken, including funding for approximately 7,000 ha of new forest planting.

As for the key priorities, this year’s budget is consistent with that of last year with regard to the Government’s priorities for the agrifood, marine and forestry sectors, namely, the protection of incomes for family farms, support for small farm holdings in disadvantaged areas, taxation measures to restructure, modernise and promote growth in the agrifood and farming sectors, the provision of support programmes in line with the targets of the Food Harvest 2020 strategy, particularly concerning job creation, the provision of support for the future of the sector through new research and development funding and through investment in food safety and animal health and welfare controls and a continued programme of reform within the Department aimed at continued improvement in service delivery and reducing costs.

I refer to taxation measures in respect of restructuring and modernising the agrifood sector In addition to and together with direct financial support for the agrifood sector, the Department has secured agreement for a range of taxation reliefs that will link in with the key measures being pursued in the Food Harvest 2020 strategy for the growth and development of the agriculture, food and marine sectors. The main taxation measures in the budget which will benefit the sector are the retention of the general 25% rate of stock relief for all farmers and 100% stock relief for young trained farmers, a new farm restructuring initiative to allow consolidation of land parcels with the aim of improving the overall efficiency of the combined holdings, an expansion of the foreign earnings deduction scheme, which benefits SMEs, to apply where an individual spends 60 days a year developing opportunities for Ireland in certain key markets, the extension of the farm partnership scheme to sectors other than milk production partnerships, subject to State aid approval and relief from excise duty on auto-diesel for licensed road hauliers. These taxation measures reflect the Government’s commitment to the agrifood industry and in particular to the expansion planned in the Food Harvest 2020 strategy. They are designed specifically to address key constraints in the sector and ensure the growth potential of the sector is fully realised.

In respect of beef, I note the €25 million of continued investment in suckler beef. The Department was anxious to build on the success of the suckler cow scheme that operated from 2008 to 2012 and accordingly, has allocated €10 million in 2013, financed from unspent single farm payment funds, for a new support programme for suckler beef farmers to participate in a new beef data programme. When taken together with residual payments of €10 million under the suckler cow welfare scheme, this will amount to €20 million in direct payments to suckler farmers in 2013. This programme will assist farmers in improving the genetic quality of Irish cattle and will maintain the data flow into the Irish Cattle Breeding Federation, ICBF, to build further knowledge and more rapid progress in breeding and ultimately in profitability for farmers.

In addition, the sum of €5 million has been set aside to support the continuation for another year of the beef technology adaptation programme, a scheme that provides beef farmers with better information and improved skills to increase profitability on farms.

The dairy sector continues to perform very well on international markets. New growth projections arising from the abolition of quotas in 2015 will allow Ireland to increase milk output by up to 50% in line with the industry target set out in Food Harvest 2020. My Department is anxious to continue to support this growth and has provided some €10 million under the targeted agriculture modernisation scheme in support of dairy farm modernisation, providing grant assistance of up to 40% for investment in dairy farm facilities. Although the dairy discussion group programme has come to an end and has achieved its objectives, an additional sum of €1 million has been provided to allow a further opportunity to new entrants to participate in this valuable programme, which builds organically a level of knowledge of best farming practice, tutored by peers, and which has proven extremely popular and beneficial in building greater levels of on farm efficiency.

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