Denis Naughten (Longford-Roscommon, Fine Gael)
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Question 154: 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 Central Statistics Office, which is running considerably above the level of general inflation; her views on the implications of this rise for farmers who wish to expand or persons who wish to enter farming for the first time; and if she will make a statement on the matter. [22181/06]

Mary Coughlan (Donegal South West, Fianna Fail)
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The rise in agricultural land prices over the last 10 years has been primarily driven by the decline in the amount of land available for sale as well as our strong economic growth. The volume of agricultural land being offered for sale has declined by 71% between 1995 and 2004, while the average price of agricultural land has increased from €5,641 to €16,261 per hectare.

Clearly the lack of available land and high sales prices can act as a constraint on some farmers. In order to overcome this, many farmers who wish to expand production are opting to lease or rent farmland. Approximately one-fifth of farm land was leased in 2003 (the latest year for which data is available).

In order to encourage land mobility, and to reduce the costs of land transfer, the Government has put in place a number of incentives, these include:

∙An Early Retirement Scheme pension of up to €13,515 for a period of 10 years on farms transferred by gift, sale or lease.

∙An installation aid grant of €9,520 for young trained farmers.

∙Capital Gains Tax Retirement Relief for farmers over 55 years.

∙A rental income tax exemption of €10,000 for farmers over 40 years who lease out land on a long-term basis.

∙A 90% Agricultural Relief from Capital Acquisitions Tax.

∙The provision of full Stamp Duty relief for young trained farmers.

∙Stamp Duty relief for land swaps between two farmers.

These incentives encourage the early transfer of land without the necessity of purchase and improve the overall levels of land mobility. This, in turn, helps improve the availability of land to farmers who wish to enter farming or increase their scale of production.