Brendan Griffin (Kerry South, Fine Gael)
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246. To ask the Minister for Agriculture, Food and the Marine his efforts on all fronts in incentivising farming for young persons and support for young farmers; and if he will make a statement on the matter. [45896/15]

Simon Coveney (Cork South Central, Fine Gael)
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In line with the EU Regulations giving effect to the reformed Common Agricultural Policy, I have implemented two key schemes under Pillar 1 to support young farmers. The measures provided through the ‘young farmer’ priority category of the National Reserve and also the Young Farmers Scheme are designed to encourage and facilitate the entrance of young, well educated persons into our farming community. This implementation of these measures has the potential to play a major role in the regeneration of agriculture in Ireland and will provide a solid basis for the industry in the coming years.

Successful young farmer applicants to the National Reserve will receive an allocation of new entitlements on the basis of one entitlement for one hectare. Applicants who already hold existing entitlements which are below the national average value will receive a top-up whereby the value of those entitlements will be increased to the national average value. The National Reserve fund in 2015 is based on 3% of the Basic Payment Scheme financial ceiling, which is estimated at providing approximately €24 million in funding. Some 6,000 farmers applied under the Young Farmer category of the National Reserve and payments are currently being issued.

With regard to the Young Farmers Scheme, young farmers will receive the payment under the scheme for a maximum period of five years. The ‘five years’ is dated from the year of setting up of the holding in his/her own name. The Young Farmers Scheme payment will be made on a maximum of 50 entitlements. I have opted to use the maximum financing rate of 2% for the Young Farmers Scheme. Funding of €24 million is available under the scheme for 2015 and the same financing rate will be applied for the years 2016 to 2019. I have selected the method of calculation which will give the maximum payment possible. The payment will be calculated as 25% of the national average payment per hectare which is estimated will give a payment of approximately €66 per entitlement held by the young farmer. Some 8,500 farmers applied under the Young Farmer Scheme and payments to eligible applicants are currently being issued.

I have also established a dedicated capital investment scheme for young farmers under TAMS II, offering a wider range of investment items than is generally available, and with an enhanced rate of aid of 60% as compared with the standard 4 0% grant.  A similar dedicated investment scheme is available for Organic farmers, with a range of items specific to organic production, and again offering a 60% rate of aid for young farmers.  For any young farmers who do not meet the eligibility requirements for these dedicated schemes, I have ensured that their applications will be prioritised under the mainstream TAMS schemes, which are open to all.

Last September I presented a six point plan, to both the EU Commissioner and my EU ministerial colleagues, to address the particularly acute situation in the dairy sector. I was extremely pleased that the final decision at Council took account of Ireland’s requests and included the provision of targeted direct aid for dairy farmers, which can be matched nationally. The aid comprises €13.7m of EU funding and a further €13.7m in matching national funding. The payment will be made on a flat rate basis with each of the 18,000 dairy farmers in the country receiving approximately €1,350, with an additional €800 top-up for young dairy farmers. The flat rate payment will be made in the coming weeks and the young farmers’ top-up payment will be made in early 2016 when that scheme is finalised.

The Agri-taxation Review was a joint initiative by the Minister for Finance and me, which was published as part of Budget 2015, and set out the main policy objectives for continuing support through agri-taxation measures including increasing land mobility and the productive use of land and assisting succession and the transfer of farms. Both objectives are especially relevant to young farmers.

Budget 2016 continued the implementation of the Agri-taxation Review and a major new initiative on ‘Family Transfer Partnerships’ to assist succession was announced. It is a structure in which family members enter into a partnership, and appropriate profit-sharing agreement, with the provision for the transfer of the family farm to the younger farmer at the end of a specified period (not exceeding ten years). To support this transfer a tax credit of up to a maximum of €5,000 per annum for five years can be allocated to the partnership, thereby incentivising the transfer and mitigating some of the financial concerns involved. The partnership model enables a gradual transfer of control and also facilitates knowledge transfer from one generation to another. In addition two measures specifically aimed at young farmers were renewed for a further three years – the 100% Stock Relief on Income Tax for Certain Young Trained Farmers and the Stamp Duty Exemption on Transfers of Land to Young Trained Farmers. These changes are subject to EU State Aid approval.