Following discussions with the European Commission, I was pleased to announce in March last significant increases, averaging 30%, in the rates of annual forest premium for those planting from 1 October 1999. In the case of farmers planting broadleaves (oak and beech) in severely handicapped areas, for example, the annual premium increased from £265 to £373 per hectare. For farmers planting 20% diverse conifers, the premium increased from £210 to £308 per hectare. The new scheme included a three-yearly view, which the previous scheme lacked.
The Commission was unwilling at that time to co-fund similar increases for those who planted in earlier years, on the basis that they had signed a contract.
My Department made a further detailed submission to the Commission in April 2000 in support of such increases. I vigorously pursued this case at a number of meetings with the Commission both here and in Europe in the latter half of last year. Regrettably, the Commission remained steadfast in its refusal to co-fund the increases.
Application of the 30% increase to pre-1999 planting would give a much needed boost in terms of confidence for the sector, in meeting the targets in our afforestation programme and in delivering on the forestry elements of the National Climate Change Strategy. For that reason I am now considering possible funding from the Exchequer, at an estimated annual cost at present of £3.4 million, for those who planted prior to 1 October 1999. In view of the State aids aspect, any decision to have the cost borne by the Exchequer would also require Commission agreement.
