Seanad Éireann debate -
Wednesday, 10 Oct 2001

Vol. 168 No. 4

Adjournment Matters. - Grant Payments.

Mrs. Taylor-Quinn

I welcome the opportunity to raise this matter on the Adjournment and welcome the Minister of State, Deputy Davern, to the House. He will be aware that small and medium sized farmers, particularly those in County Clare, are experiencing significant difficulties due to a combination of factors such as the inability to sell cattle as a result of the foot and mouth outbreak in the earlier part of the year. The fact that farmers had to hold on to cattle and provide them with additional fodder was very costly.

A number of dairy and beef farmers are participating in the control of farm pollution scheme for which there has been a substantial uptake throughout the country. I appreciate that the £15 million set aside for grant payments under the scheme has already been spent. Many farmers are awaiting the cheque from the Department, but, unfortunately, the bank is, in many instances, waiting for it too. Farmers are paying interest on loans they have taken out. The situation might not be as serious as it is were it not for the unsold cattle and additional fodder payments.

I appreciate that the Minister has made representations to Brussels in regard to the difficulties being experienced by farmers, but the Department is surely in a position to meet a certain level of payments from Exchequer funding. I raised this issue with the Minister, Deputy Walsh, in early August and was sure that the matter would have been dealt with in Brussels by mid-September. We are now in the middle of October and nothing has happened. I urge the Minister to explore other means of dealing with the matter.

Small and medium sized farmers in what were traditionally known as disadvantaged areas are subject to the area based compensatory allowance scheme which is based on acreage rather than headage. Lowland farmers are benefiting to a greater degree than farmers with poorer land. Some farmers receive £70 per hectare while others receive £60 and £45. There are huge discrepancies between the various categories of farmers. I urge the Minister to increase payments in the lower and middle categories to £70 per hectare to avoid this distinction. It is ironic that the farmers with the best land are getting the most money. The Minister should remove the inequalities in this area. If one goes into particular townlands or parishes, one will find one farmer receives £3,100 while another receives only £1,600. The Minister of State, hailing from the fine land of Tipperary, may not appreciate the level of disadvantage about which I speak. However, he is a reasonable and logical man and I am confident he will recognise the need for fair play in this area.

A survey of farm incomes published last week showed that almost 60% of farmers earn less than £10,000 per annum while 63.5% earn less than the average industrial wage. Many farmers will not acknowledge this as their standing in local communities is a matter of pride. I urge the Minister to recognise the particular difficulties which have arisen this year and acknowledge the need for a special package to address them on a one-off basis.

Minister of State at the Department of Agriculture, Food and Rural Development (Mr. Davern)

I should take this opportunity to congratulate the Senator on her success in getting her colleague added to the ticket in County Clare.

Mrs. Taylor-Quinn

I did not think the House was a suitable place to raise internal party politics.

Mr. Davern

I am glad to see a person of long-standing being added to the ticket. Having fought for it, today's achievement is a personal success for the Senator.

I am pleased to have the opportunity to address this matter on the Adjournment as my Department's performance, particularly in regard to the delivery of payments, has not always received the credit it warrants. I want to clarify the position regarding the control of farm pollution scheme which commenced in June 1999 and its successor, the farm waste management scheme, introduced in February this year.

I will address the older scheme first as it is the one about which there is most concern. The scheme came into operation on 28 June 1999 as a State aid with formal approval from the Commission for expenditure of up to £15 million. It proved highly successful and applications far exceeded expectations. Up to May this year, my Department made payments amounting to almost £15 million under the scheme in respect of 2,400 individual applicants, and had, therefore, reached the ceiling imposed by the Commission. By that stage, my Department had been in discussion with the Commission about raising the ceiling for payments under the scheme. This is a technical issue which the Department has vigorously pursued with the Commission for a number of months.

There is an inevitable and time consuming series of formal procedures through which applications of this nature must be processed by the Commission. As a result, some 650 payments have been temporarily delayed. However, as the Minister stated in reply to parliamentary questions yesterday, a positive response is expected shortly. As soon as approval to increase the ceiling is received, all outstanding payments will issue immediately.

Mrs. Taylor-Quinn

How soon will that happen?

Mr. Davern

Very shortly.

Mrs. Taylor-Quinn

I expected the matter to be dealt with by mid-September.

An Cathaoirleach

The Minister of State to continue without interruption.

Mr. Davern

Unfortunately, the Commission closes down in August.

The farm waste management scheme was approved under Agenda 2000 and, together with schemes for dairy hygiene and alternative enterprises, was formally launched in February 2001. The total amount of funding for these schemes in the period 2002-06 is in the region of £260 million, of which £180 million is allocated to the farm waste management scheme.

As Members are aware, these schemes were only up and running a few weeks before the foot and mouth crisis and to control the imminent threat of this terrible disease, the Department had to impose an immediate ban on farm visits. This meant that none of the applications received under the new scheme could be approved since the conditions of the scheme require that departmental inspectors visit each applicant to examine the position on the ground. While the ban on farm visits was lifted at the end of May, the majority of these inspectors remain assigned to foot and mouth disease duties and this has seriously affected the rate at which applications can be approved.

We are making progress, however. Up to 30 September, 2,019 applications had been received under the new farm waste management scheme, of which about 50% have been processed while just under 600 have been approved to proceed. Nonetheless, to speed up the rate at which the remaining applications can be approved, my Department has sought permission from the European Commission to reduce the level of pre-approval inspections required. We hope that, as a temporary measure, we can avoid having to carry out inspections in every case and instead approve most remaining applications on the basis of a detailed desk check. The Commission is at present considering our request. I stress that no payments are outstanding to any applicant under this scheme.

The new area-based compensatory allowance scheme was agreed in July 2000 and approved by the European Commission in the context of the CAP rural development plan. The new arrangements involve a cost of about £180 million in 2001, representing an increase of about £60 million over the old animal-based headage scheme. It is estimated that about 75,000 farmers stand to gain from these new arrangements while, compared with payments under the old animal-based headage scheme, 24,000 stood to lose money. However, a compensation package has been negotiated with the European Commission under which 90% of any loss would be made good this year.

The payments now being made to farmers include this compensation for losses in appropri ate cases. It should also be noted that payments under the new scheme commenced on Friday, 21 September, as agreed in the protocol on direct payments to farmers and £147 million has been paid to date to 85,434 farmers, representing over 86% of the total number of applicants. This compares very favourably with the figure of just over £68 million which was paid to farmers at this time last year under the old animal-based headage schemes. The new scheme is currently being reviewed with a view to finding the most equitable arrangements with particular reference to farmers with mountain type land, such as those to whom the Senator referred.

The Seanad adjourned at 9.05 p.m. until 10.30 a.m. on Thursday, 11 October 2001.