Michael Healy-Rae (Kerry, Independent)
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1428. To ask the Minister for Agriculture, Food and the Marine his plans to provide a compensation scheme for farmers in counties Kerry and Cork which were affected by bad weather during the harvest season (details supplied); and if he will make a statement on the matter. [1239/17]

Michael Creed (Cork North West, Fine Gael)
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I know the Deputy raised this matter with me just before Christmas and I wish to re-iterate I fully acknowledge and accept that difficulties have been experienced by the farming community, not least by our tillage farmers. This sector is a very important area in the agricultural economy and 2016 was a challenging year both in terms of market returns and variable weather conditions experienced during the harvest. I wish to confirm that I have a number of key supports available to the tillage sector.

The Deputy is aware that last October I chaired a meeting with the main stakeholders in the tillage sector. As I said at the time and I wish to repeat here again 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 and in direct response to the difficulties being experienced, I outlined that one of my chief priorities was to provide low-cost more flexible finance and in this regard I was happy to announce on Budget Day, my plans for 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 cashflow 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. I recently welcomed the SBCI “Open Call” for financial intermediaries to deliver the Scheme.

The SBCI is targeting that the loans will be available in the market by the end of this month.

I am encouraging 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.

The loan scheme is part of a “three pillar strategy” in response to income volatility that I announced in the 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 is available for 2016 tax liability, and will go some way towards addressing cashflow concerns.

As an additional support to cashflow on farms, including Tillage farms, I also confirmed that advance payments would be made this year in respect of the Basic Payment and Greening Payment schemes. Advance payments commenced on the 17th October last, the earliest possible date by which payments can begin under the governing EU Regulations, with the addition of balancing payments from the 1st December.

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. Also a TAMS Scheme specifically tailored to the tillage sector is due to open shortly. This scheme will support grain growers in achieving further economic efficiencies and details will be made available in the near future.

In addition, €3M was paid in December under the Protein Aid Scheme to over 1,000 farmers growing in excess of 12,000 ha of beans, peas and lupins. This coupled scheme was introduced in 2015 as part of the implementation of the reformed CAP package in Ireland.

I also stressed at the Tillage stakeholders meeting and I want to restate 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.