asked the Minister for Finance if he will ensure that farmers are provided with adequate credit facilities to help them overcome any temporary difficulties which they may be meeting at the present time.
Ceisteanna—Questions. Oral Answers. - Credit Facilities for Farmers.
20.
The Central Bank, with my approval, has just issued new advice to the commercial banks to the effect that an increase in credit during the remainder of this financial year is desirable and practicable, to encourage increased productive activity in the private sector, which includes agriculture, and especially an expansion of exports of goods and services. The increase in aggregate credit which the Central Bank has suggested will have the effect of making available about £10 million of additional credit to the private sector during the rest of this financial year. This easing in the overall credit situation should make things substantially easier for farmers. I know that the banks are fully conscious of the needs of cattle producers in present circumstances, and that requests from the credit-worthy borrowers in that category are being treated sympathetically.
The Agricultural Credit Corporation is also helping to ease the position of farmers affected by the fall in cattle prices. The Corporation is providing special unsecured loans of up to £500 for the retention of livestock by farmers in present circumstances. The normal security required is a simple promissory note signed by the borrower. The Corporation also has a scheme of instalment credit facilities for the purchase of dairy livestock, subject to a maximum of £1,000 or 80 per cent of the cost of the animals: under this scheme loans given before 31st December, 1966, bear a special interest rate of 2½ per cent per annum. There is also an unsecured loans scheme under which loans up to a maximum of £400 are available for productive purposes such as the purchase of livestock, feed, seeds, fertilizers and machinery.
If I find that the funds of the Agricultural Credit Corporation are inadequate to deal with the present volume of applications for short-term loans to farmers who wish to hold over their stock, I will agree to any reasonable increase over this year's capital provision of £3.6 million to meet the situation.
Is the Minister aware that small farmers are in urgent need of financial assistance? Many of them are unable to get the money from the bank or the Agricultural Credit Corporation at the present time. Furthermore, I would ask the Minister if he would ask the banks and the rating authorities not to press these small farmers unduly until they get a market for their cattle. The Minister gave us a figure a fortnight ago that half the applications for loans to the Agricultural Credit Corporation are turned down and, in the majority of cases, it is the small farmer who is turned down.
The commercial banks are, I think, dealing very sympathetically with the farmers in present circumstances. Furthermore, a range of facilities is being made available by the Agricultural Credit Corporation to farmers and I am told by that body that they are meeting the applications of credit-worthy farmers. If they find the resources available to them this year, £3.6 million, are not adequate, we will then consider increasing these resources.
(Interruptions.)
Order.