Michael D Higgins (Galway West, Labour)
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Question 133: To ask the Minister for Agriculture and Food if her attention has been drawn to recent figures published by the Central Statistics Office showing that agricultural land prices rose by more than 25% in the last quarter of 2004; her views on the rapid rate of increase in the price of land; her views on the implications of this increase for farmers hoping to expand or those who wish to enter farming for the first time; and if she will make a statement on the matter. [26450/05]

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. The number of land parcels placed on the market annually is relatively small, and Ireland's strong economic growth has increased demand for all forms of land. Average agricultural land prices for 2004 were €16,156 per hectare, an increase of 12% on 2003. While there was an exceptionally high increase of 25% in the fourth quarter of 2004, it was partly reversed by a decline of 12% in the first quarter of 2005. The CSO does caution that these figures are based on a very small amount of agricultural land placed on the open market each year; only 0.1% of agricultural land was sold in 2004.

Traditionally, Irish farms are kept within families and are transferred through gift or inheritance. This combined with the low level of land sales means the main option for those who wish to expand their holdings is through leasing. In 2003, almost one-fifth of all agricultural land was leased with one-third of Irish 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 and to improve the overall levels of land mobility. There are generous income tax disregards for farmers who lease-out land on a long-term basis. Capital gain tax retirement relief is available to farmers over 55 years who dispose of their farming business, while farmers over 40 years can avail of a rental income tax relief on leases of five years or longer. These measures help improve the availability of land to farmers who wish to increase their scale of production.

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 are 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. I believe these are pragmatic measures to help facilitate those who wish to enter agriculture or those who wish to expand production.