Tommy Broughan (Dublin North East, Labour)
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Question 10: To ask the Minister for Agriculture, Fisheries and Food if he will review the decision to cut €37 million from the critical and long-standing disadvantaged areas scheme; and if he will make a statement on the matter. [37433/08]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Does Deputy Sherlock want to take that as the same question?

Seán Sherlock (Cork East, Labour)
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Am I to take it that the answer is the same as that given for Question No. 8?

Tom Sheahan (Kerry South, Fine Gael)
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Farmers are losing money and there is no way for the Minister to dress that up.

Brendan Howlin (Wexford, Labour)
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Shall we move on to Question No. 11?

Seán Sherlock (Cork East, Labour)
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I wish to ask a supplementary question.

Brendan Howlin (Wexford, Labour)
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The Deputy may do so and we will take the answer as read.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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That is fine.

Additional information not given on the floor of the House.

My approach in preparing the 2009 Estimates for my Department was to focus available resources on the measures that allow us to maintain and grow the productive capacity of the agrifood sector. The 2009 Estimates provide over €1.8 billion for my Department, and, when combined with EU funding of €1.4 billion, total expenditure in 2009 by my Department will amount to over €3.2 billion.

While difficult decisions had to be taken in light of the situation with the public finances, account also had to be taken of the very high level of investment by the Government in recent years when significant additional financial resources were committed to areas such as the rural environment scheme, where the rates of grant had been increased by 17%, the new suckler cow welfare scheme, the farm waste management scheme and, indeed, the 8% increase in rates under the disadvantaged areas scheme itself, introduced in 2007.

With regard to the 2009 disadvantaged areas scheme, I decided to reduce expenditure for next year by reducing the maximum area limit to 34 hectares, or 84 acres and by a small increase in the minimum stocking density requirement. While overall expenditure will fall, almost 67,000 farmers will not suffer any reduction in their payments as a result of the introduction of the 34-hectare limit. Furthermore, these farmers, as well as all claimants under the scheme, will continue to benefit from the substantial increase of 8% in the rate of aid introduced by the Government in 2007. In addition, of the 102,500 farmers who benefit under the disadvantaged areas scheme, in excess of 50,000 of these also benefit under REPS, while in excess of 47,000 also benefit under the suckler welfare scheme, which introduced a new stream of payments to farmers in 2008. It should also be taken into account that, in addition to the payments under these schemes, a further €920 million was paid to farmers with disadvantaged area lands under the 2007 single payment scheme.

The total amount payable of €220 million to farmers under the disadvantaged areas scheme is part of the overall substantial injection of funds paid to farmers situated in the areas and the scheme continues to be one of the best well funded disadvantaged areas schemes in the European Union.

Notwithstanding the difficulties in the public finances and the decisions I have taken against that background, the position is that in excess of €3.2 billion will be spent next year by my Department in support of agriculture, fisheries and food. It is important to get through this challenging period and continue towards achieving the full potential of our most important indigenous industry when the economy begins to grow again.

Seán Sherlock (Cork East, Labour)
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I will take the answer as read but I wish to state that money is being taken out of farmers' real income here. Some of the measures that have been implemented in this budget, including this one, will bring about a further demise in agricultural productivity.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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As I outlined in previous responses, this particular payment is one of a number that are made by the Department. Some agricultural programmes are funded by the Exchequer, while others are funded by the European Union. In 2009, some €44 million will be provided for the suckler cow welfare scheme, €220 million for the disadvantaged areas scheme, €355 million for the rural environment protection scheme and €1.3 billion in respect of the single payment scheme. They are all very substantial payments. There is also a substantial programme of investment in on-farm facilities. In the partnership programme agreed in 2006, agreement was reached that funding of approximately €350 million would be provided in respect of on-farm investment schemes for the duration——

Seán Sherlock (Cork East, Labour)
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The Department has ridden roughshod over some of those programmes since then. The Minister is being very selective, with all due respect.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Deputy Sherlock queried, understandably, the level of financial commitment to the agricultural industry. All of those schemes are important. This year alone €377 million was devoted to the farm waste management scheme. These are all important measures for farmers. We cannot ignore the substantial funding both from the Exchequer and from the European Union this year, which will continue next year. These are all important schemes.

Seán Sherlock (Cork East, Labour)
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The farm waste management scheme is a result of obligations under European Commission rules which had to be implemented.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Unfortunately we had to make a decision to reduce——

Michael Creed (Cork North West, Fine Gael)
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Lest the impression be created that farmers seek a special deal, they do not. Farmers and the farming organisations I have consulted acknowledge the difficult financial circumstances and say they are prepared to shoulder their fair share of the burden.

Previously I remarked on budgetary U-turns and said we should treat this budget as a work-in-progress. The Minister for Finance, Deputy Lenihan, has exempted minimum wage recipients from the 1% levy. Since the Minister has the Teagasc farm income survey at his fingertips, will he consider exempting anyone in receipt of farm assist, which is top-up payments from the Department of Social and Family Affairs or the Department of Community, Rural and Gaeltacht Affairs? Will the Minister, Deputy Smith, consider exempting any farmer in receipt of farm assist from the reduction in disadvantaged area payments? The Minister can talk about increases, but remember that behind all these figures are farm families subsisting on annual incomes of less than €20,000. These payments make up a substantial part of that income. Even those on such minimum wages say they are prepared to shoulder their fair share of the burden. However, this is not a 1% levy on farm incomes, it is a significant proportion of their income. There are farmers throughout the country losing between €5,000 and €6,000. Those in disadvantaged areas are set to lose on average €1,000. Will the Minister exempt those in receipt of farm assist for a start?

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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There are 102,000 farmers in the disadvantaged area scheme.

Tom Sheahan (Kerry South, Fine Gael)
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We have heard all of this before.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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This measure or reduction in the payment applies to farms greater than 34 hectares. The average size of a family farm in Ireland is 31 hectares. The reduction in expenditure kicks in at——

Michael Creed (Cork North West, Fine Gael)
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The Minister is aware that extensive holdings in the west are not as fertile as the golden vale.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I am fully aware of that. The decision was made and will result in a loss to those individuals.

Michael Creed (Cork North West, Fine Gael)
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It is disproportionate and unfair.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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More than 60,000 will not be affected by this measure.

Seán Sherlock (Cork East, Labour)
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These measures will further undermine the rural economy and that is the bottom line.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Every sector wishes to contribute at a time when there are particular difficulties, but I have not heard any suggestion of an alternative from anyone here or anywhere else.

Michael Creed (Cork North West, Fine Gael)
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We did provide a suggestion.

Brendan Howlin (Wexford, Labour)
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We have only two minutes left. I will allow two Deputies speak briefly, namely, Deputies Doyle and Sherlock.

Andrew Doyle (Wicklow, Fine Gael)
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Will the Minister review the whole matter? The Minister says there will be savings in administration of 1% or €3.9 million of a total budget of €311 million. The Minister is either suspending or closing programmes. There is some €215 million in the development programmes and some €37 million in the disadvantaged areas programme.

Brendan Howlin (Wexford, Labour)
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The Deputy is giving information.

Andrew Doyle (Wicklow, Fine Gael)
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Will the Minister review the matter?

Brendan Howlin (Wexford, Labour)
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I call Deputy Sherlock.

Andrew Doyle (Wicklow, Fine Gael)
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It is no more than a 1% reduction in administration costs.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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At least two Deputies referred to the 1% levy. In the aftermath of the budget I discussed the issue with individual farmers, colleagues in the Oireachtas and farm organisations. I then spoke to the Minister for Finance, Deputy Brian Lenihan, about the imposition of the 1% levy and how it might affect the farming community. The issues of taxation and the 1% levy will be finalised in the Finance Bill 2008. I have already conveyed to the Minister for Finance the issues raised by the farm organisations. I have also discussed with the Minister for Finance measures which could be considered in the Finance Bill 2008 that may affect new and young entrants to agriculture.