Dáil Éireann Debate, Wednesday - 15 April 2015
246. Deputy Gabrielle McFadden asked the Minister for Agriculture, Food and the Marine when the European Commission is launching its roadshow to explain the workings of a new guarantee system to ensure access to credit for farmers as a result of a new memorandum of understanding agreed between the European Union and the European Investment Bank; and if he will make a statement on the matter. [14000/15]
View answerCommissioner Hogan’s recent announcement refers to financial instruments programmed through rural development programmes and funded accordingly through programme budgets. Ireland’s draft Rural Development Programme 2014-2020 states, ‘Ireland will keep the possible use of financial instruments under review during the programming period’.
My Department and I have been active in exploring new and more competitive sources of funding and will continue to do so in the context of evolving market requirements. The recent announcement by the Strategic Banking Corporation of Ireland of a new product, ‘Agriculture Investment Loans’, is a welcome addition to the sources of funding currently in the market. This credit is available, subject to qualifying criteria, at favourable terms (i.e. longer term and lower interest rate) for investments by agricultural SMEs involved in primary agricultural production, the processing of agricultural products or the marketing of agricultural products.
In relation to accessing finance and credit terms generally, I have recently been in contact with the main banks. I emphasised that this is a critical phase in Ireland’s dairy expansion and that the increased investment and output from production and processing will have significant downstream benefits across the economy generally, including for the banking sector. In order to support the on-going development of the dairy sector and to mitigate the current difficulties caused by milk price volatility, I asked them to explore the full range of potential measures that could serve to alleviate the loan repayment burden facing farmers and offer maximum flexibility for dairy farmers in what will be a difficult year ahead. I believe that it is essential that short term cash flow difficulties are not allowed to undermine prudent investment plans or the longer term competitiveness of their operations. I will continue to communicate with the main banks on issues affecting the sector.
