Dáil Éireann debate -
Thursday, 26 Jan 1995

Vol. 448 No. 2

Adjournment Debate. - Afforestation Incentives.

Mr. Kenneally

I thank the Ceann Comhairle for allowing me to raise this matter and the Minister for coming in to reply. I congratulate him on his promotion and wish him well in his endeavours.

The matter I raise is a national problem. It is one which contributes to the acceleration of rural depopulation and must be addressed. I am concerned about a proposal in the Mount Mellary area of West Waterford, a mountainous area where the land is mostly poor and the farmers mostly small farmers. The average holding in the area is in the region of 90 acres. The adjusted acreage of any farm is probably in the region of only 35-40 acres. I know of one small area where previously ten to 12 farmers were involved in dairying and now all but two of them have transferred to dry stock or sheep or, more likely, let the land. Of the two remaining farmers involved in dairying, their quotas are very small, fewer than 20,000 gallons. Everybody knows the difficulties in surviving on a farm with such a small quota. The reason the other farmers went out of dairying was that the quotas were too low.

On one farm there was a quota of 12,000 gallons and that has been sold to a local estate which has a quota in the region of 200,000 gallons. That is an example of what is happening. We seem to be going back to the days of landlordism. Surely some mechanism could be found where other farmers in the area could avail of that quota to make their holding more viable.

The present proposal concerns a joint venture with Coillte for planting approximately 70 acres of good land. There are about 2,000 acres planted already, mostly in the mountainous region, but now people are starting to plant the more fertile lands. At present people are entitled to plant up to 500 acres without planning permission, and the obvious thing to do is to plant 499 acres at a time. That matter must be considered, otherwise we will be totally overrun by afforestation.

The local people cannot compete with the package Coillte has put forward. Some consideration must be given to setting up a land authority to help smaller farmers to compete. Since there are subsidies to plant trees, why are they not given to help farmers in other areas to compete? Young farmers in particular should be given assistance and I know it is the Minister's desire as much as mine that young farmers stay in rural Ireland. We must help them to make their holdings more viable and provide a future for themselves and their families.

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

I thank Deputy Kenneally for raising this very important matter. I would like to open my remarks by dealing with the development of forestry in Ireland, particularly as it relates to farmers. Within the past two years we have seen a marked increase in afforestation in Ireland. The availability to farmers and others of grants and premium support, made possible by EU, CAP and Structural Fund Programme, has generated greatly increased levels of planting, particularly on private lands. It is worth mentioning that private planting now accounts for more than 50 per cent of all planting in the country. Furthermore, farmers account for over 75 per cent of all planting by private landowners.

The current afforestation and forestry premium schemes were introduced as accompanying measures to the reform of the agricultural policy. Forestry now represents a particularly attractive asset and income option for farmers. Grants for planting range between £1,300 and £3,000 per hectare. The annual premiums payable to farmers in recognition of loss of income from lands which are planted range between £130 and £300 per hectare per annum and are payable in the case of farmers for up to 20 years. This contrasts with the non-farmer premium which is confined to a range of between £80 and £120 per hectare per annum and is payable for a maximum of 15 years. At the highest end of the range, it is, therefore, possible for a farmer to obtain premium payments totalling £6,000 per hectare over a 20 year period, whereas a non-farmer can earn a maximum of £1,800 per hectare over a period of 15 years. This deliberate weighting of the premium scheme in favour of farmers has played a large part in making the forestry option an increasingly attractive one for farmers, as borne out by the figures. The increasing importance of forestry to farmers is also borne out by the increased level of attention being paid to it by farming organisations, which is very welcome.

Within the next few months the Government will publish a national strategic plan for forestry which will be the first of its kind. This will provide a framework within which forestry and its derivative and related activities can be developed to maximum national advantage of decades to come.

The environment is an extremely important integral part of forestry planning and practice. We will be ensuring, by various means, that forestry development takes careful account of our environment. A review of controls on large scale forestry and, in particular, the effectiveness of planning controls in this area which is being undertaken by my Department in conjunction with the Department of the Environment is nearing completion and will be an important contribution in this regard.

The tax regime governing forestry is not the cause of any difficulty or distortions in so far as farm forestry is concerned. Profits arising from the occupation on woodlands managed on a commercial basis are exempt from income tax, as are grants and premiums payable to qualifying farmers and nonfarmers. Provisions in the area of capital gains tax and acquisition tax are also conducive to promoting forestry development. It is most important to bear in mind that we are undertaking the promotion of forestry not alone as an alternative use for agricultural land but in terms of putting in place a resource base for forest-based industries in future. We have already seen evidence that these can make a significant contribution to the creation of employment.

As regards the Mount Melleary area of County Waterford. I am not aware of any general difficulties affecting farmers in so far as forestry is concerned. I am aware of one case in which there is concern about the impact of a planting proposal. My Department has indicated that if a grant application is received in respect of this project, an inspection of the site will be carried out prior to planting and grant approval. This will check whether any environmental concerns arise and determine whether the project complies with the Department's standard environmental guidelines which, inter alia, require all planting to be kept a minimum stated distance from dwellings and farm buildings. I understand Deputy Kenneally's concern about this growing nationwide problem and undertake to look at it.

The Dáil adjourned at 5.25 p.m. until 2.30 p.m. on Tuesday, 31 January 1995.