Lorraine Higgins (Labour)
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I welcome the Minister of State and thank him for taking this matter on the Adjournment. I seek clarification concerning the payment to farmers of grants under the agri-environment options scheme, AEOS. When will these payments be made? A large number of farmers in my local area, for example, in Athenry, Loughrea, Gort, Tuam and Kinvara, have been waiting for an unacceptably long time to have payments furnished to them. I understand farmers in the Galway East constituency are not alone and that numbers awaiting payment run into the thousands. Most of those affected are in an uncertain position and it is a source of frustration to them that payments are being held up for reasons that are not clear. The farmers in question have co-operated fully with the conditions of the scheme and are to be commended on the patience they have shown thus far. Farmers require certainty, however, regarding when payments will be made, given that in the current times they must manage tight farm budgets.

I am aware that administrative problems arose in the AEOS 2 scheme but the matters were resolved after some time had elapsed. It is clear that more targeted action must be taken to prevent a repeat of these problems. It is vital that farmers receive their AEOS 2 payments immediately and that all payments are made without undue delay. Farm incomes have declined significantly in recent years and in the current times the option of subsidising their income by securing off-farm employment is no longer available. For this reason, the types of financial supports provided under the agri-environment options scheme are vital for ensuring the continuing success of local community focused farms. In the circumstances, I ask the Minister of State to confirm when the payments will be made and seek an assurance from the Minister for Agriculture, Food and the Marine that he will undertake to ensure all payments will be made in a timely manner in future. I look forward to the Minister of State's response.

Seán Sherlock (Cork East, Labour)
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I thank Senator Higgins for raising this matter and convey the Minister's regrets that he cannot attend this debate in person. To set the context, the position is that payments by the Department of Agriculture, Food and the Marine under the agri-environment options scheme, or AEOS as it is commonly known, are well advanced at this stage. Before discussing the details, I emphasise the commitment of the Minister and Government to the agri-environment schemes, namely, AEOS and the rural environmental protection scheme, as operated by the Department. The schemes put environmentally friendly farming to the forefront and recognise the vital role farmers play in delivering public goods in protecting the environment and natural heritage for the benefit of society as a whole. This commitment is evident in the fact that despite serious budgetary pressures facing his Department, the Minister opened AEOS to new applicants last year. In this regard, an additional ¤20 million was made available annually for five years to fund new applications under the scheme. This ongoing commitment is also evident in the fact that more than ¤750 million was spent by the Department on agri-environment schemes in the past three years alone, with a further ¤200 million available in 2013 under both REPS and AEOS.

There are currently almost 30,000 participants in REPS and their contracts will continue until expiry of the five year contract period in each case. The successor to REPS, the agri-environment options scheme, is a more targeted agri-environment scheme for which funding is provided from modulation funds under the Common Agricultural Policy health check. As Senators will be aware, AEOS specifically targets three challenges that have been assigned the highest priority at European Union level as needing urgent action. The format of the scheme is a menu type approach, as distinct from the whole farm approach adopted under REPS. It consists of actions which can be demonstrably linked to the three important challenges targeted.

There are approximately 15,000 participants in AEOS 1 and 2, which were opened to new participants in 2010 and 2011, respectively. The EU regulations governing the scheme and other area based schemes require that a full and comprehensive administrative check, including cross-checks with the land parcel identification system, is completed before any payment can issue. Previous EU audits have made it clear that compliance with the regulations must be strictly adhered to and all checks must be passed and eligibility conditions met before payment issues. This means payment cannot be released until all aspects of a farmer's application are in order, all outstanding documentation provided and all queries resolved. These requirements are a significant administrative challenge, albeit one that the Department has successfully addressed.

The current position regarding payments under AEOS is that under AEOS 1, all outstanding payments due in respect of both 2010 and 2011 have been finalised.

Of the 7,500 participants remaining in that scheme, nearly 6,500 have received payment in respect of 2012. The remaining cases are being cleared on an ongoing basis as queries are resolved.

There are 6,250 approved participants in AEOS 2, 5,300 of whom have received a payment in respect of 2011. The outstanding cases are being finalised as outstanding queries are received. Applicants have been informed of these outstanding queries and payments are being made on an ongoing basis as responses are received.

Last year saw the first full-year payment for AEOS 2 applicants. In order to activate payment where non-productive capital investments were selected, a valid capital investment claim form was required. The high level of queries and farmer delays in submitting valid claims has resulted in a lower than expected level of 2012 payments under AEOS 2. In all, 2,500 have received payment at this stage. There are a large number of queries arising. To deal with the outstanding queries, additional resources have been directed to this area with the intention of clearing the backlog as soon as possible. The majority of the outstanding payments relate to applicants who chose a capital investment option, such as the planting of trees or hedgerows, on their AEOS contract. Under the scheme, payment for these options commences in 2012. In order to be paid for 2012, farmers must have submitted valid receipts.

Approximately 1,000 farmers have not submitted any claim form to date and of those who did, a very high percentage had queries which require further contact with the farmer. For these farmers, no part of their 2012 payment can be issued until they submit their receipts and the outstanding issues are resolved with them. The Department has contacted farmers who have not submitted claim forms at least twice, including where possible by phone, and is now dealing with replies received and outstanding queries. Where applicants have received correspondence in this regard, they should respond as soon as possible. On the basis of responses received from letters that have issued and the phone calls made by officials in the Department, the Minister aims to ensure that all outstanding cases are resolved in the shortest time possible.

As I have mentioned, AEOS 3 was opened to applications at the end of 2012. The funding of ¤20 million per annum that the Minister has provided will allow for approximately 4,000 new participants to be approved. The Department is currently processing the applications with a view to issuing approvals in the next few weeks. It is expected that payments will commence towards the end of the year.

I reaffirm the Government's commitment to the agri-environment schemes. The Minister is at all times conscious of the importance of the payments to farmer's incomes. He asked me to convey that he will ensure that his Department continues to make every effort to expedite all payments under these schemes.

Lorraine Higgins (Labour)
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I thank the Minister of State for her response. It would be helpful if the Minister, Deputy Coveney, were here. Agriculture is his specific responsibility and there were a few points I wanted to put to him. I accept that if applications are not fully completed, it is very difficult to pay out. The reality is that quite a number of farmers have completed their application forms properly and would have expected to have been paid out in a timely manner. It would be extremely helpful to farmers, particularly those in my constituency, if the Minister indicated a timeframe, in terms of weeks or months, in which farmers will be paid. Ultimately, they have financial and other commitments, and they have creditors whom they are expected to pay, just like anybody else. They are totally reliant on schemes such as the AEOS to assist them in that regard.

I acknowledge and welcome the additional resources provided by the Minister to ensure payments will be made. I ask the Minister of State to pass on my thanks to the Minister in that regard. I urge the Minister to indicate a timeframe in which the payments will be made and to make a public statement on the matter.

Seán Sherlock (Cork East, Labour)
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I fully acknowledge the points made by Senator Higgins. To be helpful, I will make sure to speak to the Minister on the issues she has outlined in respect of her constituency. A legitimate question arises if no queries arose regarding individual farmers' applications and if the files still have not been dealt with expeditiously. I will certainly relate this to the Minister.