Willie Penrose (Longford-Westmeath, Labour)
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49. To ask the Minister for Agriculture, Food and the Marine the measures in place to support young farmers; his plans to improve same; and if he will make a statement on the matter. [41652/17]

Michael Creed (Cork North West, Fine Gael)
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The National Reserve and the Young Farmers Scheme were introduced under the reform of Direct Payments in 2015. These schemes were designed to provide financial support to young farmers and new entrants to farming during the crucial early years immediately following the setting up of a farming enterprise.

Under the EU Regulations governing these schemes,  a young farmer is defined as a farmer aged no more than 40 years of age in the year when they first submit an application under the Basic Payment Scheme and who commenced their farming activity no more than five years prior to submitting that application.  A new entrant to farming is defined as a farmer who commenced their agricultural activity during the previous two years and did not have any agricultural activity in their own name and at their own risk in the five years preceding the start of the present agricultural activity.

The National Reserve provides for an allocation of entitlements at the national average level or a top-up on existing entitlements that are below the national average to the two mandatory categories of ‘young farmer’ and ‘new entrant to farming’.  In 2015 the National Reserve fund was based on a 3% cut to the Basic Payment Scheme financial ceiling and this cut provided some €24 million in funding. Some 6,250 applicants were allocated entitlements under the 2015 National Reserve.

In 2017, approximately 1,300 young farmers and new entrants applied for an allocation of entitlements under the National Reserve. Funding of some €5 million has been made available from a linear cut to the value of all Basic Payment Scheme entitlements. The 2017 National Reserve will provide for an allocation of entitlements at national average value to young farmers and new entrants who are deemed eligible under the scheme.

The question of a National Reserve for 2018 will be considered following an analysis of the funding available when all eligible applicants under the 2017 National Reserve have been catered for.

The Young Farmers Scheme is a separate scheme that provides for an additional payment to young farmers based on activated entitlements.  Over €24 million is allocated to the Young Farmers Scheme each year from 2015 to 2019. Payment is made to approx. 9,000 young farmers annually under the Young Farmers Scheme.

The closing date for receipt of applications under the 2017 National Reserve and Young Farmers Scheme was 15th May, 2017. My Department is at an advanced stage of processing applications submitted and payments are due to commence in early December 2017.

The TAMS II Young Farmer Capital Investment Scheme which is co-funded under the Rural Development Programme 2014-2020 has a broad range of investment items available for qualifying Young Farmers.

Young Farmers can avail of the enhanced grant rate of 60% as compared to the standard rate of 40% . To date 2,466 approvals have issued to Young Farmers  and approvals continue on an ongoing basis.

There are a number of taxation measures specifically aimed at young farmers, specifically ‘100% Stock Relief on Income Tax for Certain Young Trained Farmers’ and ‘Stamp Duty Exemption on Transfers of Land to Young Trained Farmers’.  

The Agri-taxation Review which was published as part of Budget 2015 set out the main policy objectives for continuing support to the sector through agri-taxation measures including increasing land mobility and the productive use of land: Budget 2015 included the doubling of the existing relief for income from long-term leasing of land and introduced a package of new measures to incentivise long-term leasing, which has a number of advantages over the conacre system. It allows progressive farmers to enlarge their farm holdings and increase productivity and also allows young farmers and new entrants to the sector gain access to land by providing a cheaper means of long-term access to land, as opposed to the relatively high cost of land purchase. Leasing also provides security of tenure and the certainty required to encourage lessees to maintain and make investments in improving land and it provides a route to retirement for older farmers, assisting in generation renewal. There is already evidence of a significant increase in long-term leasing due to these changes.

A second objective of the Agri-taxation Review was to assist with succession and the transfer of farms: The age profile of Irish farmers is increasing and it is recognised that there are many social and economic reasons why succession management is a challenge for farmers. Assisting succession and the transfer of farms has been a central part of the Government’s agri-taxation policy and Budget 2015 included a number of measures to maintain and strengthen that support, specifically the retention of Agricultural Relief from Capital Acquisitions Tax, Retirement Relief from Capital Gains Tax and the stamp duty exemptions on transfers of land. There were a number of new measures to make these reliefs more effective, including targeting Agriculture Relief at active and trained farmers.

In addition, in June of this year, I launched the ‘Succession Farm Partnership Scheme’. The Scheme provides for a €25,000 tax credit over five years to assist with the transfers of farms within a partnership structure, promoting and supporting the earlier inter-generational transfer of family farms. It also encourages important conversations within farm families about succession planning.