Michael D Higgins (Galway West, Labour)
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Question 82: To ask the Minister for Agriculture and Food if her attention has been drawn to the continuing increase in the price of farm land identified by the CSO, which is running way above the level of general inflation; her views on the implications of this rise for farmers who wish to expand or for persons who wish to enter farming for the first time; and if she will make a statement on the matter. [6960/05]

Mary Coughlan (Donegal South West, Fianna Fail)
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Low levels of land mobility have been a long-term feature of Irish farming and the substantial increase in land prices in recent years and the relatively small acreage of land that is placed on the market annually have not helped the situation. Since 1997 agricultural land prices have more than doubled reflecting a combination of a shortage of land on the market and increasing levels of demand from agricultural and non-agricultural buyers. According to the Central Statistics Office, in recent years less that 0.2% of agricultural land has been placed on the open market for sale. The major means by which land has changed ownership in recent years has been through inheritance, generally within families.

The cost of purchasing land has encouraged many farmers who wish to expand their enterprises or enter agriculture to opt for leased land. Almost one fifth of all agricultural land is leased with one third of farms leasing-in some portion of land.

For meaningful farm planning, leasing is best done on a long-term basis, and the Government has a number of incentives in place to encourage this trend and to improve the overall levels of land mobility. To this end, my Department operates an early retirement pension for retiring farmers who dispose of land either by sale, transfer or long-term lease.

There are generous income tax disregards for farmers who lease out land on a long-term basis. At present lessors aged over 40 years of age can avail of annual exemption thresholds of up to €7,500 for leases of five to seven years and up to €10,000 for leases of ten years or more. This has undoubtedly encouraged the better utilisation of land and facilitates better long-term planning by farmers who wish to increase their scale of production at a reasonable cost without having to purchase.

There are also a series of measures in place to help reduce start-up costs for new entrants. These include a number of generous grants and tax reliefs. For young, suitably trained farmers there is a number of attractive schemes including an installation aid grant of €9,520, 100% stamp duty relief on land, a 90% relief from capital acquisition tax, CAT, and 100% stock relief for four years for eligible farmers.