John Perry (Sligo-Leitrim, Fine Gael)
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Question 235: To ask the Minister for Agriculture and Food the reason hundreds of retired farmers are suffering severe financial hardship due to an unfairly implemented EU pension scheme; the measures in place to redress same; and if she will make a statement on the matter. [9270/07]

Mary Coughlan (Donegal South West, Fianna Fail)
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I do not accept that the EU co-funded Schemes of Early Retirement from Farming have been implemented unfairly. As regards the level of pension under the 1994–1999 and 2000–2006 Schemes, the possibility of a co-funded increase was raised with the European Commission on a number of occasions but they ruled it out. In 2006, however, I secured an indication from the Commission that they would not object to the payment of a top-up amount to existing Scheme participants provided it was funded entirely from the National Exchequer. As part of the Towards 2016 agreement negotiated with the farming organizations, the maximum rate of pension payable under the 1994 Scheme was increased from €12,075 to €14,075 and the maximum rate of pension payable under the 2000 Scheme went up from €13,515 to €15,000. These increases which were paid with effect from 1 November,2006 will cost some €33 million extra over the remaining period of the two Schemes and some 5,000 retired farmers will benefit from them.

As regards the deduction of national retirement pensions from Early Retirement pensions, this is a requirement of the EU Council Regulations under which the 1994 and 2000 Early Retirement Schemes were introduced. In the earlier years of the 1994 Scheme, not all national retirement pensions were offset against the EU-funded pension. Following clarification from the European Commission, a broader definition of national retirement pensions was applied. However those participants who had already joined the Scheme continued to benefit from the previous arrangement.

Regarding the implication of decoupling for retired farmers who had leased out land and quota to transferees before or during the Single Payment Scheme reference period, I believe we secured the best deal that we could for people in this situation, in spite of the reluctance of the Commission at the outset. A specific mandatory category was included in the National Reserve arrangements under the Single Payment Scheme. This category caters for farmers who inherited or otherwise received a holding free of charge or for a nominal amount from a farmer who retired or died before 16 May 2005 where the land in question was leased out to a third party during the reference period. Under these arrangements, where a farm reverts to the retired farmer at the end of a lease without any entitlements, the farmer taking it over will have access to the National Reserve. Retired farmers in the Early Retirement Scheme who farmed during part or all of the reference period and who held Single Payment entitlements could activate entitlements and lease them to their transferees. If the transferee did not wish to use the entitlements, a transferor has until 2007 to lease the entitlements with land to another farmer. Once at least 80% of the entitlements have been used by the lessee, the transferor has the option to sell the entitlements with or without land; otherwise he can continue to lease the entitlements with land.