Kevin O'Keeffe (Cork East, Fianna Fail)
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1414. To ask the Minister for Agriculture, Food and the Marine if he will accept the recommendations of the Joint Committee on Agriculture, Food and the Marine for action in support of the tillage sector. [1046/17]

Kevin O'Keeffe (Cork East, Fianna Fail)
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1415. To ask the Minister for Agriculture, Food and the Marine if he will make compensation available to tillage farmers as proposed in appendix 1 under the heading, Immediate Response to the Crisis in the Irish Tillage Sector of the Requirement for Action in Support of the Irish Tillage Sector, report, page 3, by the Joint Oireachtas Committee on Agriculture, Food and the Marine. [1047/17]

Michael Creed (Cork North West, Fine Gael)
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I propose to take Questions Nos. 1414 and 1415 together.

I was pleased to have the opportunity to address the Committee on December 6th last. The exchange with members which followed was both useful and informative. During this exchange I outlined in some detail the response of my Department to the difficulties posed by harvest conditions in 2016. I would like to take this opportunity to further address these issues as presented for consideration in the submission by the Oireachtas Joint Committee on Agriculture, Food and the Marine.

Following a meeting with the main stakeholders in the tillage sector in October of last year I addressed a particular difficulty that faces not just tillage farmers but all farmers: access to low-cost more flexible finance, by introducing a €150 million Agri Cash Flow Loan Support Scheme. This has been 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 €150 million, which 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 the EU’s Agriculture State Aid de minimis requirements.

This is a cash flow support facility, to improve the working capital position of farmers and other viable primary agriculture SMEs. The loans will be unsecured and are primarily to pay down expensive forms of credit such as merchant credit, and other short-term financing facilities such as overdrafts. The SBCI is targeting that the loans will be available in the market by the end of January 2017. Farmers are encouraged 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.

The loan scheme is part of a “three pillar strategy” in response to income volatility announced in Budget 2017, along with additional tax measures and farm payments. Among the tax measures is an adjustment to the current ‘Income Averaging’ system, which allows for an opt-out in an exceptional year. This is available for 2016 tax liability, and will go some way towards addressing cash flow concerns.

As an additional support to cash flow on farms, including tillage farms, advance payments were made in 2016 in respect of the Basic Payment and Greening Payment schemes. These advance payments commenced on the 17th October last. To date €1,162 billion has been paid out to more than 122,465 farmers and payments are ongoing. Payments in excess of €195 million have been made to more than 91,000 applicants under the Areas of Natural Constraints scheme.

It is my intention that the  new TAMS Scheme, specifically tailored to the tillage sector, will open shortly. This scheme will support grain growers in achieving further economic efficiencies and details will be made available in the near future.

With regard to the proposal on medium to long-term actions to develop the sector, many of the actions identified are worthy of further consideration. A Tillage Sector Development Plan was prepared and published by the Teagasc Tillage Crop Stakeholder Consultative Group. This report was launched by the then Minister for Agriculture, Food and the Marine, Simon Coveney TD and made a significant contribution towards implementation of the Food Harvest 2020 report.

The Tillage Stakeholder Consultative Group made a further significant contribution to the development of the Food Wise 2025 chapter on priorities and actions for the tillage sector. The group continued to refine and prioritise key objectives for the sector and on my invitation made a presentation to the Food Wise 2025 High Level Implementation Committee in September of last year. Indeed I understand that the group is already looking at several of the proposed actions contained in the Committee’s submission and I look forward to hearing from it on these points in the coming months.