Michael Healy-Rae (Kerry, Independent)
Link to this: Individually | In context | Oireachtas source

222. To ask the Minister for Agriculture, Food and the Marine his views on a matter (details supplied) regarding tillage farmers; and if he will make a statement on the matter. [36663/16]

Michael Creed (Cork North West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

At the outset I wish to state that I am very much aware of the challenges this year for the Tillage Sector with low prices and challenging harvest weather.

I know you will be aware I recently chaired a meeting with the main stakeholders in the tillage sector. This meeting provided a platform for the stakeholders to express their views and concerns on the challenges they are facing but equally to discuss the opportunities that lie ahead for the industry.

At that meeting, I outlined that one of my priorities was to provide low-cost more flexible finance and in this regard I was happy to announce on Budget Day plans for a €150 million Agri Cash Flow Support Loan Scheme. Developed in conjunction with the Strategic Banking Corporation of Ireland (SBCI), by leveraging EU and Exchequer funding totalling €25m from my Department to deliver a total loan fund of €150m, it will support highly flexible loans for up to six years, for amounts up to €150,000. The interest rate applying is 2.95% and the product will be available to livestock, tillage and horticulture farmers. Loans to tillage and horticulture farmers will be provided in line with agriculture State Aid de minimis requirements. This is a cash flow support facility to improve the working capital position of viable primary agriculture SMEs, including farmers. The loans are primarily to pay down expensive forms of credit such as merchant credit and other short-term financing facilities such as overdrafts. Last week I welcomed the SBCI “Open Call” for financial intermediaries to deliver the Scheme, which will be operational as early as possible in 2017.

The loan scheme is part of a “three pillar strategy” in response to income volatility that I announced in the recent Budget, along with additional tax measures and farm payments. Among the tax measures, I agreed with my colleague the Minister for Finance, for an adjustment to the current ‘Income Averaging’ system, which will allow for an opt-out in an exceptional year. This will be available immediately, for this year’s tax liability, and this will go some way towards addressing current cash flow concerns.

As an additional support to cash flow on farms including Tillage farms, I also confirmed that advance payment would be made this year in respect of Basic Payment and Greening Payment scheme.

Advance payment commenced on the 17th October last, the earliest possible date by which payments can commence under the governing EU Regulations. Up to last week €786 million has been paid out to 119,904 farmers.

I was also pleased to note that the processing of the Areas of Natural Constraints payment scheme is on schedule and payments have already commenced during the third week in September. It is expected that approx 96,500 will fulfil the scheme eligibility requirements.

I stressed at the meeting also and want to re-state my view that in this changing landscape we need to take a fresh look at our tillage industry, to ensure that it is best positioned to withstand possible future threats and to avail of the new opportunities which may present themselves.