Michael Creed (Cork North West, Fine Gael) | Oireachtas source

The national reserve measure of the basic payment scheme provides for an allocation of entitlements to eligible applicants. EU regulations governing the national reserve provide that the two mandatory categories of "young farmer" and "new entrant to farming" must receive priority access to the reserve. A young farmer is defined as a farmer aged no more than 40 years of age in the year when they first submit an application under the basic payment scheme and who commenced their farming activity no more than five years prior to submitting that application. A new entrant to farming is defined as a farmer who commenced their agricultural activity during the previous two years and did not have any agricultural activity in their own name and at their own risk in the five years preceding the start of the current agricultural activity.

Returning emigrants who meet the eligibility criteria for applicants under the national reserve will be eligible to submit an application for an allocation of entitlements. The terms and conditions applicable to all categories under the national reserve require applicants to have a gross off-farm income of €40,000 or less in either of the two tax years prior to the year in which the application is made to the national reserve. All national reserve applicants must also comply with requirements in terms of an agricultural education qualification at Further Education and Training Awards Council, FETAC, level 6 or equivalent.

The regulations governing the operation of the national reserve also include an optional provision whereby member states may use the national reserve to allocate new entitlements or give a top-up on the value of existing entitlements for persons who suffer from a "specific disadvantage". Support for such categories can only be considered once the two mandatory categories of young farmer and new entrant have been catered for. Decisions regarding the eligibility of farmers under the specific disadvantage category of the national reserve require the approval of the European Commission.

Following my Department’s consultation with the European Commission, the then Minister announced in March 2015 that the group commonly known as old young farmers, who established their holding between 1 January 2008 and 31 December 2009, and who, due to the timeframe of setting up their holding, did not benefit from either the installation aid or the young farmer category of the national reserve, could be considered as a "group suffering from specific disadvantage". Following approval by the European Commission, this group was eligible to apply under the national reserve measure of the 2015 basic payment scheme. Some 280 applicants were successful under the old young farmer category of the 2015 national reserve. Therefore the old young farmer group has already been catered for under the 2015 national reserve.

Additional information not given on the floor of the House

The group commonly known as the forgotten farmer group comprises farmers aged under 40 who established their holdings prior to 2008 and who hold no entitlements or low value entitlements. Preliminary analysis carried out by my Department shows there are 3,900 farmers in this category. An estimation of the cost of increasing the value of existing entitlements to the national average for these 3,900 farmers stands at in excess of €12 million. A Programme for a Partnership Government contains a commitment to further pursue the category of forgotten farmers at EU level.

In 2015, the national reserve fund was based on a 3% cut to the basic payment scheme financial ceiling and provided €24 million in funding which was the maximum financing rate available under the relevant EU regulations. There was no national reserve in 2016 as all available funding had been utilised under the 2015 scheme. To provide for a national reserve in 2017, funding is required to replenish the reserve. EU regulations governing the scheme provide that funding for the replenishment of the national reserve may be obtained by means of surrender of entitlements that remain unused by farmers for two consecutive years and by clawback derived following the sale of entitlements without land. It is envisaged that funding derived from these two sources in 2017 will be very limited. The regulations also provide for the option of applying a linear cut to all farmers' entitlements to fund the national reserve. Decisions on the national reserve for 2017 will be considered once the position on potential funding has been established.

Consultation between departmental officials and the direct payments advisory committee, comprising members of the main farming organisations, agricultural education and farm advisory bodies, takes place annually as part of the decision-making process for the national reserve.

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