Mary Coughlan (Donegal South West, Fianna Fail)

Ar dtús, tá lúcháir orm bheith ar ais sa Seanad. Seo mo chéad ocáid oifigiúil mar Aire Talmhaíochta agus Bia. Ag éisteacht leis na Seanadóirí, tús maith leath na hoibre ach fan go bhfeicfimid nuair a bheimid críochnaithe i gceann cúpla bliain. Is pribhléid dom é bheith anseo le mo chéad Bhille faoi chúram na Roinne Talmhaíochta agus Bia a chur os ár gcomhair. On this my first appearance in Seanad Éireann in my new role as Minister for Agriculture and Food, I want to pay tribute to my colleague and former Minister for Agriculture and Food, Deputy Joe Walsh, for his long and dedicated service to our most important indigenous industry.

The Land Bill I am proposing will be a very great benefit to landowners in general and farmers in particular. The Bill will provide a direct financial benefit to thousands of farmers who are currently paying land purchase annuities, ease the transfer of trust land and reduce bureaucracy and the expense involved in conveyancing.

The Irish Land Commission was established in 1881. It was originally a rent fixing body but its main business became that of facilitating the transfer of the freehold ownership of land from landlords to their tenants. It examined the landlord's title, paid him the purchase money and vested the freehold in the occupying tenants. As many tenants did not have access to sources of capital to pay the purchase price the concept of the land purchase annuity was introduced, whereby capital was provided to tenants and repaid by the tenant owner by way of an annuity spread over a term of years. These annuities were effectively advances or loans and played a very important part in bringing about tenant ownership.

Much work was done by the Land Commission between the years 1881 and 1921, by which time over 316,000 holdings, covering an area of 11 million acres, over 50% of the total land area of the country, had been bought out and vested by the Land Commission and some 750,000 acres of untenanted land had been distributed among some 35,000 allottees either by way of enlargement or by the creation of new holdings.

With the foundation of the State, the Land Commission embarked on a countrywide programme of structural reform which aimed, through the acquisition and distribution of land, to enlarge and re-arrange smallholdings and, generally, to relieve congestion. For the common good and where necessary, land was acquired compulsorily for the enlargement of uneconomic smallholdings. This work led to approximately 2.5 million acres of land, a further 15% of land in the State, being eventually distributed among some 150,000 beneficiaries. Overall, two thirds of land in the State changed ownership with the assistance of the Land Commission in the past 125 years, causing a radical alteration in Irish society.

By the early 1980s it was generally accepted that the Land Commission had achieved its primary objectives. Accordingly, it was decided to terminate acquisition and dispose of the remaining lands on hand. The Land Commission was eventually dissolved by the Irish Land Commission (Dissolution) Act 1992, which came into effect on 31 March 1999. Since the transfer of the Land Commission's land and other functions to the Department of Agriculture and Food, my officials have continued to wind up the affairs of the former Land Commission. The measures in this Bill primarily deal with better administration of annuities; the easing of the transfer of trust lands; a reduction in bureaucracy; and a reduction in the cost of conveyancing transactions for all agricultural land, for example, land not wholly situated in a county borough, a borough, an urban district or a town.

This Bill is one of the commitments to the farming sector and the partnership process under the Programme for Prosperity and Fairness and the Sustaining Progress agreements. In bringing forward this Bill, I am fulfilling the commitment to introduce a Land Bill on the operation of land purchase annuities and the management of the former Land Commission lands.

I will now outline in greater detail the principal aspects of the Bill. There is good news for farmers with annuities in that it is proposed to make legal provision for the write-off of all annuities of €200 per annum or less and approximately 4,500 farmers will benefit. As a result of this provision, two thirds of all annuities will be written off. Not only will this mean that these farmers will not be liable for half-yearly payments to the Department, but their land will no longer have the burden of an annuity attached to it. In time, this will reduce the amount of paperwork involved in any conveyance of such land, resulting in reduced conveyancing costs in the longer term. The benefits of this measure will be felt throughout the country. They are not confined to farmers alone but will include anyone involved in conveyancing agricultural land and the purchasers of such land. This measure will benefit approximately 4,500 annuitants to a total sum close to €4 million.

In section 3 of the Bill provision is made to encourage farmers who still have outstanding land purchase annuities to take the final step towards fully owning their land. When enacted, I will introduce a scheme to allow farmers with land purchase annuities of more than €200 per annum to buy them out. Some 2,300 farmers will be able to avail of this concession to buy out their annuities at a substantial discount of 25%, subject to all outstanding arrears being paid in full. This measure has the capacity to alleviate an existing debt problem for certain farmers and improve the financial situation of most annuitants. While no remaining annuity has an interest rate in excess of 11% since 1993, I am aware that it is possible in certain circumstances to obtain commercial loans with a much lower interest rate.

The 25% reduction in the redemption price of the annuity coupled with the substantial increase in the value of agricultural land in recent years makes it attractive for most, if not all farmers, to re-structure their debts and improve their overall financial position. I advise farmers to consider this offer very carefully and discuss with their financial advisers the opportunities it presents. I stress it is very important that farmers establish clear title to the land because it is intended that the buy-out scheme will be limited to six months duration. If any dispute as to ownership, title, etc, arises, it may not be possible for them to avail of the scheme. I recommend that anyone with land purchase annuities attached to his or her land should now inquire from his or her legal adviser that his or her title is clear. The administration of the estates of parents or grandparents should be attended to as a matter of urgency.

The House should also be aware that the provision will increase the outright ownership by farmers of land free from any encumbrances, thus giving the same benefits to these farmers as the farmers who are the subject of the write-off contained in section 2 of the Bill. The yield to the Exchequer as a result of this measure could be up to €18 million, depending on the numbers who enter the buy-out scheme.

In addition to reducing the number of annuities, I am also providing greater control measures for annuities in the interests of the taxpayer and equity. As part of this initiative on annuity compliance, section 4 of the Bill makes legal provision for the setting off of any grant or single payment entitlements due to farmers by the Department against annuity payments that are owed and not discharged. Furthermore, I am introducing a control measure in section 5 whereby individuals with land purchase annuities will be required to present a certificate of compliance to the Land Registry in cases where they propose to dispose of all or part of the land subject to an annuity. My Department will only furnish such certificates where arrears outstanding have been cleared or, preferably, the entire annuity redeemed.

In section 6 of the Bill I propose to amend section 28 of the Land Act 1933 by inserting a new provision which will enable my Department to recover payment of arrears of annuities from defaulters by way of judgment in the courts in cases where such moneys are not recoupable except through payment owed to them by third parties. The proposal will provide that a warrant issued under section 28 of the Land Act 1933 may take the form of an attachment of debts by garnishee order or the appointment of a receiver by equitable execution following an application to the court. These measures will not be entered into without having previously attempted to come to some voluntary arrangement regarding any arrears that arise after closure of the buy-out scheme.

I will now outline the next element of the Bill which deals with the easing of transfer of trust land. Section 7 of the Bill deals with transfer of land which is the subject of a trust set up under the Land Acts. It is proposed to simplify conveyancing procedures of trust properties to ease transfer of ownership by removing the legal and financial burdens from trustees. Approximately 500 of these local trusts are in existence, almost half of which are used by local GAA and other sports clubs. The balance are mainly turbary and cow-park trusts established to provide some communal land for the keeping of animals by those in rural communities who did not own agricultural holdings. In the case of sporting trusts, because the sporting organisations do not own the property, they are reluctant to commit to significant development of, or investment in, the trust property. As a result, many properties are not maximising their potential benefit to the community in which they are situated.

The measure I am proposing should greatly facilitate the legal transfer of these lands from trust to actual user ownership, thus allowing greater development of these sporting and other local amenity facilities to the benefit of the whole community. I believe there may be as many as 200 trusts interested in availing of this measure. I recommend that other trusts should also consider the benefits offered by this measure.

Vesting orders are the means used by my Department to transfer land ownership of the person or persons named in the order. Section 28 of the Land Act 1931 currently provides for publication in the prescribed manner. This is onerous and cumbersome and ultimately results in delays. I propose a technical change to the legislation governing the publication of vesting orders by repealing and replacing section 28 with a requirement to publish only a notice of the making of such orders. This will lead to administrative improvements.

At present, statutory instruments known as rules under the Land Acts, other than certain financial matters, may only be made following the convening of the rules committee. When this provision was introduced, the Land Commission was separate to the Department, the workload was heavy and it was sensible for all parties to meet and consider proposals. However, since the dissolution of the Land Commission, there is little point in having a law that specifies that two of the Department's officials must meet with the President of the High Court before a statutory instrument is made. I propose to amend section 3(1) of the Land Act 1933 to remove the necessity of convening meetings of the rules committee in favour of my Department consulting the President of the High Court, or his nominee, as Judicial Commissioner and the President of the Law Society of Ireland before making rules under the Land Acts.

On the advice of the Office of the Attorney General, I propose to make amendments of a technical nature to sections 10 and 11. In section 10, I propose to provide a statutory basis for Government decisions made in 1989 and 1992, whereby small amounts, namely £20, or €25.40, and less per annum in respect of land purchase annuities and land reclamation annuities were written off. At the time, the write off was done on an administrative basis but as annuities have a legal basis, it is prudent to have a legal basis for the write off. There are no implications for the beneficiaries of this write off and the measure is merely to provide legal certainty.

In relation to section 11, I propose to provide a statutory basis for the Government decision in 1992 which approved concessions to land purchase and land reclamation annuity payers, whereby they were offered the opportunity to buy out their annuities at a discount. However there was no provision in existing legislation authorising the Minister to accept less than the full amount to buy out such annuities. In order to provide this, it is necessary to introduce this measure in the Bill. As with section 10, there are no implications for the beneficiaries of the measure, except that it confirms their position in law.

With regard to subdivision control of agricultural land, it is proposed to repeal section 12 of the Land Act 1965. The control on the division, regarding the letting or leasing of agricultural land, was first introduced when the former Land Commission was primarily engaged in the elimination of congestion and fragmentation. The commission achieved the enlargement, consolidation and re-arrangement of holdings to a viable size through the compulsory acquisition of land and its subsequent re-allotment. Subdivision control was a logical concomitant to the process of enlarging and maintaining such holdings thereafter to prevent landowners from disposing of their property in a manner incompatible with the State's agricultural policy. Also, as long as the former Land Commission was active in redistributing land, there was logic in controlling any increase of more smallholdings, whose owners could then join the long queue of applicants for Land Commission land.

The State policy of enlarging holdings was aimed at creating viable farming units. It was a policy that was appropriate for its time and it was logical for the State to protect its investment by controlling the indiscriminate division of holdings. The State is no longer engaged in acquiring and redistributing land and there is no need for continuing subdivision control. Time has shown that economic factors tend to lead to the consolidation of holdings rather than their continued subdivision, as evidenced by the increasing size of farms in the State. For example, in 1973 the average farm size was 23 hectares. By 2002 it had increased to 32 hectares, an increase of almost 40%. As a result, the granting of consent has now become a formality and in no case in recent years has consent been withheld.

However, as section 12 of the Land Act 1965 has not been repealed, solicitors for landowners who wish to subdivide or lease their land must still apply to the Department for consent, giving rise to over 15,000 applications per year and additional costs for the landowners. The abolition of subdivision control will save landowners legal and other costs involved in making subdivision applications. In addition, there will be a visible benefit in the reduction of administrative time incurred by my staff in issuing the relevant section 12 consents.

It is proposed to repeal section 45 of the Land Act 1965. For historical and cultural reasons foreign investment in land, in particular non-resident foreign investment, was a rather sensitive issue. Prior to the Second World War there was no restriction on the purchase of land in the State by non-nationals. However, after the war, primarily as a result of changes in the tax laws in the United Kingdom, there were increasing purchases of land by non-nationals. This trend met with strong resistance from owners of small uneconomic farms who had hoped to acquire, with the assistance of the former Land Commission, the lands being bought by non-nationals.

Section 45 consent was introduced as a result of this pressure and the rationale was to ensure a fair and equitable distribution of land to Irish nationals and long-term residents and to prevent the creation of a class of non-resident landowners. In practice, a section 45 consent was required in all agricultural land purchases, which was all land except that wholly situated in a county borough, a borough, an urban district or a town. A consent was not required where agricultural land was being purchased by a class of persons known as "qualified persons" as specified in section 45 of the Act. For example, an Irish citizen, or someone who had been resident in the State for seven years, was deemed a "qualified person".

On Ireland's entry into the European Economic Community it became obvious that the restrictions on purchases of land by non-nationals, or more specifically by nationals of other members states, imposed by section 45 were contrary to our freedom of movement and establishment obligations under the Treaty of Rome. Various statutory instruments have over the years extended the categories of qualifying individuals for whom consent was not necessary.

These changes and the cessation of land acquisition by the former Land Commission in the early 1980s further reduced any justification for withholding section 45 consent. The issue of consent has become a formality. No application has been refused for several years, but because the section has never been repealed approximately 300 applications are received and processed each year. More importantly, in conveyancing transactions, solicitors must establish the nationality of their client, insert the appropriate nationality certificate in the deed of purchase, or in limited cases apply for a formal consent for their clients and perhaps charge their clients accordingly. I want this Bill to end unnecessary red tape and bureaucratic expense in checking nationality for the small number of "non-qualified" persons or companies seeking a consent. Nationality certificates will no longer be required in deeds of purchase for any land purchased in the State.

Section 13 contains the Short Title, construction, collective citation and commencement date.

The proposals in the Bill provide for a potential contribution to the Exchequer by way of a capital lump sum being paid to it. They will greatly reduce the burden of land purchase annuities for a significant number of farmers and reduce the administrative burdens on my Department permitting staff to be redeployed to more urgent and productive areas. With regard to regulatory reform, the proposals in the Bill provide for the removal of the burden of annuities for many farmers; better means of controlling arrears an land annuities; simpler vesting of trust land and rule making; the reduction of bureaucracy and costs involved in completing land transfers; and a potential contribution to the Exchequer of up to €18 million.

Mar sin, ba mhaith liom an Bille seo a chur os comhair na Seanadóirí. Tá mé ag tnúth leis an díospóireacht, agus tá súil agam go mbeidh tacaíocht ar fáil don Bhille úr seo.