I am raising this matter because it is of concern to many people who, in good faith and on the urging of all the official agencies, including the Minister of the day, entered into the farm retirement scheme. Under this scheme, farmers who had less than 45 acres and who wished to give up farming were able to dispose of their land by selling or letting provided it was to an eligible person such as a development farmer. Although they did not get the full market value of their land, they were allowed to keep the sale price and were paid an annuity for the rest of their lives. In view of the fact that they could only dispose of the land to a limited category of people, in most cases they disposed of it to the Land Commission.
The impression was given that this annuity would keep up with the cost of living and with the requirements these people would have to meet in terms of expenditure. I put down a number of questions about this and I received the following information. Since this scheme was introduced in May 1974 the rates of annuity have increased by only 66 per cent. At the same time, the rates of old age pension, payable to other people in the same age category, have increased by between 86 and 89 per cent. If one includes the increase in the current budget the rates have increased almost 100 per cent. The people who entered into the farm retirement scheme, thereby ensuring that land would be available to younger farmers who needed it, did so with a clear understanding from the Government that their pensions would keep in line with other pensions. The Government are breaking faith with these people if they do not do so. I have demonstrated that the pensions for people under the retirement scheme have fallen 40 per cent behind pensions given to old age pensioners. Everybody knows how inadequate the ordinary old age pension is. How much more so must the pension of people under this scheme be.
I will give figures which will indicate how miserable the increase of 66 per cent is in the annuities since May 1974. In the same period, that is, up to June 1978, industrial earnings went up by 135 per cent, which is more than twice as much as the annuities these people are getting. The industrial earnings went up because people had to meet increased costs. Those under the retirement scheme had to meet exactly the same costs, yet they got an increase of only 66 per cent. The annuity which is paid to these people is £996 a year for a married couple. How could anyone live on that sum in this day and age? If the annuity which started off at £600 had kept pace with industrial earnings it would now be £1,410 a year for a married couple.
The Minister of State at the Department of Agriculture in reply to a question which I asked on 7 March stated at column 916 of the Official Report:
I agree it is necessary to increase the annuities and an undertaking has been given by the government that they will be increased in line with the Consumer Price Index. This had been accepted by the previous Government and that undertaking has been honoured by the present Government.
To date, that undertaking has not been honoured by the Government. The Consumer Price Index up to November 1978, the latest date for which I have figures, increased by 83 per cent whereas the pensions to people under the farm retirement scheme have increased by only 66 per cent. If the annuity had kept pace with the cost of living it would be at least £1,098 a year. The Government increased it by only half as much as the average industrial earnings.
These people are being treated very unfairly. Successive Governments miserliness in relation to this scheme is seen by the number of people applying for it. In 1974 1,055 people applied. At that time it was presented as an attractive scheme. In 1975 the figure had dropped to 392. By 1977 it had dropped to 106 and last year only 82 people applied. People are being turned off this scheme. They are not interested in it, and why should they be if the annuity is not only increasing by less than half as much as industrial earnings but is even less than the cost of living despite the Government's undertaking that it would be kept in line? When I asked the Minister of State for an undertaking that a realistic increase would be given, he said that the scheme as a whole was being reviewed by the EEC and suggested, by implication, that it would not be possible for the Government to increase the annuities without the approval of the EEC. Otherwise, there would be no point in making a reference to the EEC review.
The Government are free to increase the annuities by as much as they wish; they do not need EEC permission. The fact that a review of the scheme is taking place at EEC level, in so far as the Government's freedom to improve rates of annuity is concerned, is irrelevant. There was no reason for the Minister of State to refer to the review because it does not affect the Government's freedom to grant an increase in line with other increases in incomes or in line with the cost of living.
In seeking to hide behind the review that is taking place in Brussels the Government were hiding behind something that had nothing to do with increases in annuities. I hope the Minister will give a definite answer about the rate that will apply to the annuities this year. I hope an increase is given to keep those annuities in line with other incomes in the community. If it is just to give an industrial worker an increase of 135 per cent since 1974 then it is just to give an equivalent increase to those involved in this scheme.
Increases in the voluntary retirement scheme should be announced by the Minister for Finance annually in his budget and take effect as a budgetary matter. I cannot see any reason why increases in old age pensions should take place in a budget—such increases were in the region of 100 per cent since May 1974—and increases in annuities are ignored. The increases in annuities since 1974 has been 66 per cent. It appears that it is left to the Minister for Agriculture, who, presumably, cannot get money to grant such an improvement, to grant an increase this year. It should be remembered that the people involved are old and are not able to look after themselves adequately but they deserve the best from the community because they have voluntarily given up their land to have it developed for agricultural purposes. They should be getting a reasonable income and any Government which fails to do that is failing in their duty. Apart from that general case the Government should ensure, as a matter of policy, that the allowances are reviewed annually in the budget and not left to be dealt with when it suits the Minister for Agriculture.
