Enda Kenny (Mayo, Fine Gael)
Link to this: Individually | In context

Question 436: To ask the Minister for Agriculture and Food if she proposes alternative enterprises for the stakeholders affected by the closure of Carlow and Mallow Greencore plants; the efforts made to protect the sugar beet market; if she proposes to assist the beet growers affected; and if she will make a statement on the matter. [8371/07]

Mary Coughlan (Donegal South West, Fianna Fail)
Link to this: Individually | In context

Throughout the negotiations on reform of the EU sugar regime, my primary objective was to seek to have the Commission's proposals modified so as to ensure the continuation of an efficient sugar processing sector in Ireland. I had several meetings with the Commissioner in that regard and Ireland played an active role in a group of eleven Member States who had common cause in seeking to modify the proposals. When it became evident at the final Council of Ministers meeting in November 2005 that there was not sufficient political support to adapt the proposals to the extent necessary, I focused my efforts on securing a very substantial compensation package for Irish stakeholders. The package, worth in excess of €310m, comprises three elements.

The first element is the compensation for the beet price reduction. This has already been incorporated into the Single Payment Scheme with effect from 2006. It will be worth approximately €123 million to Irish farmers over seven years.

The second element is the EU restructuring aid for the sugar industry, which is worth €145m approx. This has to be drawn down on the basis of an aid application, including a restructuring plan, submitted by Greencore. The plan incorporates a social plan detailing the actions planned by the company in particular with respect to re-training, redeployment and early retirement of the workforce concerned. In July 2006, the Government made certain decisions regarding the implementation of this aid, in particular the percentage of aid to be reserved for beet growers and contractors. These decisions are currently the subject of judicial review proceedings instituted by Greencore in the High Court.

The third element of the compensation package is the diversification aid worth almost €44m. A national restructuring programme has been prepared and submitted to the EU Commission, in accordance with the EU Regulations, with a view to drawing down this aid. The Regulations provide that payment would commence in September 2007. The main objectives are to minimise the loss to beet growers arising from the cessation of the sugar industry in Ireland by facilitating the development of alternative uses of land and, by enabling these farmers to earn a replacement income, to contribute to the viability of the wider rural economy of the former beet growing areas.

Following the introduction of the Single Payment Scheme, farmers now have the freedom to choose whatever farming enterprise is most appropriate to their circumstances. Many are showing interest in the potential of energy crop cultivation for biofuel purposes. I recently announced details of new bioenergy initiatives to stimulate the production of energy crops. A new Bioenergy Scheme will provide establishment grants to farmers for up to 50% of the costs associated with establishing miscanthus and willow on set-aside land and on areas, which have been subject to an aid for the EU Premium of €45 per hectare. The scheme is being piloted in 2007 and will allow up to 1,400 hectares of willow and miscanthus to be grant aided in the first year. Under the Scheme, farmers can receive up to €1,450 per hectare towards establishment costs with the balance to be invested by the farmer. Full details of the scheme are now available from my Department and the closing date for receipt of applications for pre-planting has been extended to 30 Mach 2007. I have allocated €8m to the scheme over the period 2007 to 2009.

I also announced recently my intention to introduce a new top-up payment of €80 per hectare in 2007 to support the growing of energy crops. The €80 payment will be paid as a top-up to the existing EU Energy Crops premium of €45 per hectare, bringing the overall payment to €125 per hectare. It is intended that the €80 additional payment will apply for three years and will be subject to a maximum ceiling per producer over the three years. The current maximum area payable per producer over the three-year period is 37.5 hectares. EU approval to allow an increase in this ceiling is being pursued. Willow and miscanthus are also eligible for this payment, subject to an application under the EU Energy Crops Scheme.