Thomas Pringle (Donegal, Independent)
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8. To ask the Minister for Agriculture, Food and the Marine his views on whether the provision of loans to farmers at an interest rate of 2.95% represents good value for farmers; and if he will make a statement on the matter. [32191/16]

Michael Creed (Cork North West, Fine Gael)
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Since taking up office, one of my priorities has been to address the impact on farmers of the sustained period of lower commodity prices. I am conscious that this has caused cash flow difficulties for farmers in several sectors and I am committed to using all efforts to address this issue.  The €150 million fund for "Agri Cash Flow Support" announced on budget day is one part of a three pillar strategy being put in place to respond to income volatility. The other pillars concern additional tax measures and farm payments. My objective is to ensure that we continue to have a sustainable and resilient agricultural sector.

In my discussions with stakeholders, one of the main difficulties identified was the absence of low-cost flexible finance. This fund will support highly flexible loans for up to six years, for amounts up to €150,000, at an interest rate of 2.95%.  It will be available to livestock, tillage and horticulture farmers. The proposed interest rate will represent a significant saving to farmers when compared with other forms of finance currently available.

Further details of the loan fund will be provided shortly. The Strategic Banking Corporation of Ireland (SBCI) will make an open call for lending institutions to participate and I have encouraged the main banks to make this facility available to their customers. Normal lending assessment criteria will apply although the loans will be 'unsecured' in nature, thereby facilitating a more straightforward application process.

This loan fund represents a ground-breaking and innovative approach to delivering support to farmers and it is designed to maximise the leverage achieved on the funding available. The provision of €11.1million in EU funding and €14 million in National funding by my Department enables the SBCI to leverage the total fund of €150 million.

I would encourage farmers to consider their cash flow and borrowings situation now, and if appropriate to their circumstances, to be prepared to apply for these loans when they become available.