Dáil Éireann debate -
Wednesday, 23 Feb 1994

Vol. 439 No. 3

Adjournment Debate. - Afforestation Grant Regulations.

Mr. Deenihan

During the past six months the Minister of State at the Department of Agriculture, Food and Forestry encouraged increased planting on the presumption that higher grants and premia would be payable to all farmers, full or part-time, by the European Union. A large number of part-time farmers went ahead but now find they will not receive premia at the higher rate. I understood 200 farmers, including some in my own constituency — I know some of them personally — have been affected by the recent decision.

Under the recently announced European Union forestry scheme farmers will qualify for premia at the higher rate only if they derive at least 25 per cent of their income from farming. Up to now there was no off-farm income limit. The loss to part-time farmers will be substantial as those who meet the income requirement will receive £121 per statute acre. Farmers who do not meet this requirements will qualify for a premium of only £49 per acre. In addition, qualified applicants will receive the premium for 20 years whereas those who are classified as non-farmers will receive the premium of 15 years only.

Part-time farmers will now be treated in the same way as corporations and companies, which was not the position previously. The number of part-time farmers is on the increase because of the decline in agricultural incomes. If we want to keep these families in rural areas we must provide incentives. The original proposal promoted by the Minister of State provided such an incentive.

It is clear that many part-time farmers will not go ahead with their plans because of the recent announcement. Some of those who went ahead on the presumption that they would receive grants at the higher rate now find themselves in a difficult financial position.

I understand that as recently as 11 January the Minister of State, Deputy Hyland, had a meeting with the Agricultural Commissioner, Mr. Steichen, about the new forestry scheme but at that stage there was no mention of the 25 per cent income requirement. The scheme proposed by the European Union must be a source of major embarrassment for the Minister of State and the Department who had been encouraging, in good faith, increased planting on the grounds that higher grants and premia would be payable and which would have made the scheme very attractive and lucrative for all farmers, full or part-time.

In addition, the Minister of State reassured applicants that they could go ahead on the basis of the proposals submitted by the Department to Brussels for approval. It is a bit like the Tallaght Hospital case; people had high expectations of receiving money from Europe but now there is disappointment.

Minister for the Environment (Mr. M. Smith)

The hospital is going ahead at full steam.

Mr. Creed

Build now and pay later.

Mr. Deenihan

What about the money?

An Ceann Comhairle

I do not think the Deputy should usurp the role of Deputy Rabbitte.

Mr. M. Smith

Deputy Rabbitte is a unique person.

Mr. Deenihan

We should no longer take the bureaucrats in Europe for granted. The message is that if we make an application we expect to receive it.

I call on the Minister of State to honour his commitment to those part-time farmers who went ahead on his and the Department's advice and entered into contracts on the presumption that they would receive premia at the higher rate and that this would be a very attractive and lucrative scheme. The Minister of State should not leave these people in the lurch.

Minister of State at the Department of Agriculture, Food and Forestry (Mr. Hyland)

I thank the Deputy for giving me the opportunity to clarify the situation. The Commission's Standing Forestry Committee meeting on 15 February, accepted Ireland's affor-estation programme which is part of the reform of the CAP. This programme will provide substantial increases in afforestation grant and annual premium payments. Other important benefits from the new programme will include the provision of more than 600 jobs in planting and maintenance in rural areas, the stimulation of rural development through increased economic activity, diversification of farmers' incomes and a positive contribution to the environment through increased broadleaf planting. The programme still has to be formally approved by the Commission but I expect this to happen within a matter of weeks.

On 16 February, I met with representatives of the IFA, ICMSA, UFA as well as the Irish Timber Growers Association and provided them with a detailed briefing on the outcome to the standing committee meeting.

The programme provides for two levels of annual forestry premium. The first is payable for 20 years at rates ranging between £130 to £300 per hectare per annum depending on species planted and type of land. The second and lower range is £80 to £120 per annum for 15 years and is payable to those not qualifying for the higher rates.

The Commission's qualification criteria for the higher premium will be that beneficiaries will have to have at least 25 per cent of their income coming from farming. This will apply to all member states. One consequence of this will be to concentrate the highest levels of premium support on those most dependent on farming for their livelihood. Those not qualifying for the higher premium would qualify for the lower payments. This lower range of £80 to £120 per hectare is substantially higher than the comparable old rate of £50 per hectare.

As regards the 25 per cent threshold, I wish to make it clear that Commission insistence that this be a feature surfaced very late in discussions on Ireland's programme. When I met Commissioner Steichen on 11 January he welcomed the Irish proposals. The issue of a 25 per cent threshold was not raised at this or any earlier meeting with the Commission. I was satisfied from my discussions with the Commissioner that Commission approval would be forthcoming for the programme as submitted.

When the issue of the 25 per cent threshold was eventually raised by the Commission, my primary concerns were the national importance of avoiding any further delay in securing approval of Ireland's programme and ensuring that farmers, in particular, would derive maximum benefit from this CAP afforestation scheme. Other member states were similarly anxious to avoid further delays in approval of their programmes, notwithstanding the Commission's introduction of the 25 per cent threshold.

I am currently working on the fine detail of how the 25 per cent threshold is to be interpreted and administered. I have invited the farming organisations to urgently bring to my attention any concerns they might have in this regard. I am anxious that work in this area is guided by my expressed desire to encourage the development of forestry on family farms throughout the country.

I am also sensitive to the position of those with farm incomes of less than 25 per cent of total income who have already undertaken planting. Although the number of people falling into this category will be small in relation to the number who can be expected to benefit from this scheme during its operation, I recognise that there is an issue to be tackled. I am particularly concerned to ensure that those who have received planting approvals from my Department in the period 1 August 1992 to 15 February 1994 are not disadvantaged by imposition of the 25 per cent farm income threshold. The Deputy will be glad to hear that I have already raised this matter with Commissioner Steichen and our concerns were emphatically indicated to the Commission by the Irish delegation at the Standing Forestry Committee last week. Consequently, the Commission has undertaken to re-examine the proposal particularly as it affects those individuals mentioned by the Deputy. I expect to have a response from the Commission at the next meeting of the Standing Forestry Committee on the 8 March.