Mary Coughlan (Donegal South West, Fianna Fail)
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The Joint Oireachtas Committee on Agriculture published its report on the Early Retirement Schemes in February 2005. The report dealt with a range of issues relating to the first Scheme of Early Retirement from Farming which was open to new entrants from 1994 to 1999 and the second Scheme which was open to new entrants from 2000 to 2006. I responded in detail to the report in September 2005.

As I explained in my response, certain of the Committee's recommendations were precluded by the EU Regulations under which the Schemes were operated. I saw some merit in other aspects of the Committee's report, however, specifically those relating to income limits. In line with the Committee's recommendations, I increased the off-farm income limit for transferees in the 2000–2006 Scheme from €25,400 to €40,000 and abolished the income limit for transferors with effect from 1 September 2006.

The Committee paid particular attention to two further issues. One was 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 reverted 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 had 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 had the option to sell the entitlements with or without land; otherwise, he can continue to lease the entitlements with land.

The second issue the Joint Committee focused on was the levels of payment under the two Schemes. In the course of discussions on this issue, the European Commission had pointed out that the rate in the earlier Scheme was set at the maximum amount for co-funding that the Regulation allowed, and that it would not be possible to secure co-funding for an increase in the rate of pension for existing participants in the 2000–2006 Scheme. The Commission indicated at a later stage, however, that it would not oppose increases for existing participants in both Schemes if they were funded entirely from the national exchequer as a State aid. I therefore announced substantial increases in the maximum pension rates payable under both Schemes which took effect from 1 November 2006. I increased the maximum pension rate payable under the 1994–1999 Scheme from €12,075 to €14,075 per annum and the maximum pension rate payable under the 2000–2006 Scheme from €13,515 to €15,000 per annum. These increases will cost some €33 million extra over the remaining period of the two Schemes, and over 5,000 retired farmers will benefit from them.

The maximum pension rate payable under the new Early Retirement Scheme, which was launched on 13 June 2007 and will run for the period 2007–2013 is €15,000 per annum.

The Joint Committee also raised issues about a number of cases in which farmers had entered the 1994–99 Scheme under the joint management arrangement. The three application types possible under that Scheme (sole application, joint ownership and joint management) were set down in my Department's Guidelines and the Scheme document. The joint management option meant that the Scheme was available to some farm households which would otherwise not have been able to benefit at all, and in other cases it meant that the pension could be paid for a longer period.

A number of participants who joined the Scheme under the joint management arrangement claimed to have not understood at the time that national retirement pensions payable to either or both parties in such cases would have to be deducted from the Early Retirement pension. Some of the individuals concerned argued to the Joint Committee that they should be able to change retrospectively the basis on which they entered the Scheme.

The Scheme does not allow for retrospective changes unless there are new facts or evidence that show that individual applications were wrongly classified in the first place. The requirement for the deduction of both spouses' national retirement pensions under the joint management arrangement was stated at the time in my Department's Guidelines and the Scheme document. Applicants for the Scheme, in consultation with their agricultural and or legal advisors, had an opportunity to decide on how best to structure the application to their best advantage, having regard to their individual circumstances and the Scheme conditions. My Department adjudicated on the eligibility of each application in accordance with the Scheme conditions.