asked the Minister for Agriculture if he has any proposals to deal with the serious decline in small farmers' incomes; and if he will make a statement on the matter.
32.
Ceisteanna — Questions. Oral Answers. - Farmers' Incomes.
13.
asked the Minister for Agriculture if he is aware of the serious financial difficulties that farmers now find themselves in because of low yields, low income and high interest rates; if he will provide £1 billion in Euro currency loan at 6 per cent interest to accommodate long term and short term borrowings and to eliminate the necessity for farmers to sell off their land, or assets to pay off the banks and the ACC; and if he will make a statement on the matter.
33.
asked the Minister for Agriculture if he is aware of the substantial drop in farm incomes for the second consecutive year; and the plans if any, to alleviate the widespread distress in the agricultural community.
152.
asked the Minister for Agriculture the total estimated borrowing by farmers from all sources; if he is aware of the effects of record high real rates of interest on farm incomes; and if he has any plans to ameliorate the problem.
I propose to take Questions Nos. 13, 32, 33 and Question No. 152 which was for written reply, together.
While farm incomes have declined this year a substantial proportion of the decline has been due to the adverse climatic conditions over much of the summer. The fall in incomes has occurred in spite of the reversal of the cost price squeeze which has had such a serious impact on farm incomes over much of the past decade. The fall in farm incomes does not take account of any increases in off-farm incomes or in social welfare payments, which in many instances now make a substantial contribution to the total incomes of farm households.
Measures taken by the Government to alleviate the problem at farm level have already generated considerable benefits to farmers, and these benefits will continue to flow in 1987. These measures include a short-term exchange rate guarantee scheme for farmers and private peat producers, which makes £200 million worth of loan capital available at about 5½ per cent, and a £35 million scheme for new farm development purposes under which loans are available at around 9½ per cent. The headage payment rates on beef cows have been more than doubled this year and headage rates on cattle other than beef cows have been raised by over 50 per cent. Furthermore, the headage payment schemes have been extended to the newly classified and reclassified disadvantaged areas in the current year. Let me point out that we would be paying out this year about £150 million in headage grants and related subsidies. It is a massive increase on anything that was ever paid out before.
Another benefit to agriculture has been the devaluation of the Irish green rate in September last with its consequential benefits for prices paid to farmers. I was very disappointed that some of that devaluation was not passed on particularly to beef producers. I think there was some sharp practice in that area.
As already announced, any amendments to the terms and conditions of the exchange rate guarantee schemes or any change in the amount available under these schemes will be considered in the light of experience in the operation of these schemes. There are no figures available on the total borrowings by farmers from all sources but the data available on lending by the banks and the ACC would indicate that the total is of the order of £1,500 million.
Is the Minister aware——
There are some very reasonable Deputies in the House. Deputy Foley did not ask a supplementary question on his own question. That is getting back to the good old days when it was not thought necessary to ask supplementaries.
Is the Minister aware that, in connection with the administration of the European currency at 5.5 per cent, the banks, especially, have used most of this money to help save themselves money in the long term; they have not used the £80 million for beef and grain producers for 1987 and have refused those people?
It is not correct to say that most of the money was used for purposes other than those specified. I am happy that the money has all been used for specified purposes and I conveyed that to the banks as recently as three weeks ago. I am happy that the ACC have stuck rigidly to the regulations which we have laid down.
I understand that Question No. 32 was included here, so I would ask the Minister would he agree that the amount of money provided under the Euro currency loan was far too little and the terms were too restrictive? Is the Minister aware that many people who were in grave need of such money were unable to get it because of the way in which the banks and the ACC operated? Is the Minister satisfied with the way the banks and the ACC are treating farmers?
I have already answered the second part of the question and there is no point in going into it further. I have made my views known, that I would like to see the regulations adhered to strictly. In relation to the amount being made available, farming organisations just over a year ago came to me looking for £100 million in Euro loans. Admittedly the situation has worsened considerably because of the very bad spring and the very bad summer——
And the very bad Government.
——but now I am giving £235 million. I am keeping the matter under review and if further money is needed I will be prepared to co-operate.
Does the Minister agree that it is restrictive?
Question No. 14.
Might I also say that farmers have the right to get money from the banks on their own?