Written answers

Thursday, 14 May 2015

Department of Agriculture, Food and the Marine

Superlevy Fine

Photo of Brendan GriffinBrendan Griffin (Kerry South, Fine Gael)
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99. To ask the Minister for Agriculture, Food and the Marine the efforts he and his Department have made to avoid repayments by dairy farmers in respect of milk quota super levies; if he is aware of the hardship that levies are causing to dairy farmers, and the losses they represent for rural economies; and if he will make a statement on the matter. [19002/15]

Photo of Brendan GriffinBrendan Griffin (Kerry South, Fine Gael)
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100. To ask the Minister for Agriculture, Food and the Marine if he and his officials have fully explored all butter fat related possibilities to avoid repayments by dairy farmers in respect of milk quota super levies; and if he will make a statement on the matter. [19003/15]

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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I propose to take Questions Nos. 99 and 100 together.

The milk quota regime ended on March 31st. The abolition of milk quota presents a massive opportunity for the Irish dairy sector and one which we should look forward to with confidence. The fact that producers will face a super-levy bill in relation to the final year of the system is obviously unwelcome. However, the rules governing the imposition of a super levy were set by regulations agreed at EU level. It was not possible for me on a unilateral basis to adjust these super levy rules.

I have, on numerous occasions, proposed action at EU level to mitigate the impact of super levy, primarily through an adjustment to the butterfat coefficient, as this would not have required an amendment to existing regulations. Other options previously discussed included the front-loading of the remaining quota increases, a reduction in the super levy, or a type of EU flexi-milk arrangement which would have operated providing overall EU production was within quota. However, given the opposition of some Member States, it became clear as we approached the ending of the quota era in 2015, that there was no realistic prospect of any movement on the initiatives.

Nonetheless flexibility has been secured from the European Commission for farmers to pay the superlevy fine on a phased basis over 3 years and my Department is finalising the details of a scheme to give effect to this measure at national level. I will announce details of how to apply for this scheme in the very near future.

I have also been proactive in other areas in terms of ensuring the right balance of measures are in place to ensure that Irish dairy farmers can enter the new era with full confidence. On-going contact has been maintained with the Minister for Finance to ensure that existing and future taxation policy reflects the Government’s commitment to agriculture. Of interest to dairy farmers here will be the announcement in last October’s budget to provide for income averaging over five years when it comes to paying income tax bills. I have also ensured that priority has been given to measures for the dairy sector in the Rural Development Plan. In addition, I have impressed upon the Irish banks the need to show flexibility in their dealings with farmers experiencing temporary cash flow difficulties in 2015.

I am satisfied now that this mix of measures, the worst impacts of the superlevy have been mitigated and that the dairy sector can look to the future with confidence.

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