Gay Mitchell (Dublin South Central, Fine Gael)
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Question 15: To ask the Minister for Agriculture and Food the steps she is taking to encourage the planting of forestry; and if she will make a statement on the matter. [5647/06]

Mary Coughlan (Donegal South West, Fianna Fail)
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A comprehensive range of incentives and supports is available from my Department to encourage the planting of forestry. Grants are available under the forestry grant and premium scheme which cover 100% of planting costs, so it costs landowners nothing to invest in forestry. In addition, under the current scheme farmers are entitled to a 20 year premium — 15 years for non-farmers — of up to €500 per hectare, depending on the species planted. As a further incentive, income earned from commercial woodlands is exempt from tax. In the case of individuals, the timber asset is also exempt from capital gains tax.

Under the single farm payment scheme, I was able to negotiate concessions, which enable farm-foresters to plant up to 50% of their eligible claimed areas with forestry, while still being in receipt of their full single farm payment. Supports are also available for the growing forest in the form of grants for the shaping of broadleafs and pruning of conifers, with expenditure in 2005 on these schemes of €10.5 million. Grants are also available for the construction of forest roads to facilitate access for management and harvesting operations. Expenditure on forest roads in 2005 came to €3.3 million.

In addition to these direct supports, funding is provided for research, advisory services and promotion. In conjunction with the Irish Forest Industry Chain, IFIC, the forest service of my Department is about to embark on an 18 month promotional campaign to further encourage take-up in the above mentioned grant and premium scheme along with any future afforestation scheme administered by my Department. IFIC aims to engage a full-time project manager dedicated to these promotional initiatives in the next few weeks.

The new rural development programme for 2007-13 will continue to provide generous supports for forestry in terms of both afforestation and improving the competitiveness of existing forests. In the current year, I have provided for a budget of €137 million for forestry. I urge landowners to strongly consider forestry as a sustainable investment for the future.