Martin Ferris (Kerry North, Sinn Fein)
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Question 25: To ask the Minister for Agriculture and Food if she will make a statement on the report on the early retirement scheme of the Joint Committee on Agriculture and Food. [17445/05]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I received the committee's report on 7 April and my officials are examining it. This report arises from an investigation by the committee of a complaint by a group representing retired farmers. My Department provided the committee with a comprehensive formal written response to the complaint and also attended a meeting of the committee in July 2003 to answer questions from members. The report covers a range of issues, including taxation issues, which are outside my remit. I will address the issues shortly in a formal response to the committee.

I am naturally anxious that the early retirement scheme delivers maximum benefits to retired farmers. However this is an EU-funded scheme and I am constrained by the regulations under which it was introduced. The same group of retired farmers made an identical complaint to the European Commission which the Commission did not uphold. The Commission concluded, in other words, that the Department is administering the scheme correctly and in accordance with the governing EU regulations.

The Department has recently conducted an expenditure review of the current early retirement scheme and copies were laid before the Houses of the Oireachtas on 13 April. The expenditure review process was established by the Department of Finance in 1997 in the context of the strategic management initiative. The purpose of the review of the early retirement scheme is to analyse systematically whether the scheme is meeting its objectives and to inform future decisions regarding priorities on expenditure programmes. The Department's review includes a number of conclusions and recommendations that will help to inform my response to the report of the joint committee.

Martin Ferris (Kerry North, Sinn Fein)
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Does the Minister of State agree the proposals of the joint committee are reasonable, if implemented would satisfy the issues raised by the people involved and that this could be done without going outside the relevant EU regulation? Does he agree those who entered the scheme did so in good faith and those who were not covered by the criteria governing the single farm payment should be given consideration for entitlements, either under force majeure or by some other means? Does he concur with the views expressed by the committee that it would be appropriate to address the fact that pensions awarded under the 2000 scheme are not index-linked and that this could be altered to ensure participants are given better security of income? Does the Minister of State intend to implement the proposal from the joint committee in full and, if not, does he concur with many of its recommendations?

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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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.