asked the Minister for Agriculture the total number of farmers who are in financial difficulty with the various lending institutions; the number for each county and the number in the case of each lending institution; the number whose difficulties arise as a result of (a) the purchasing of land only and (b) the development of land or the purchase of machinery, etc.; if he has any proposals to alleviate the difficulties for these farmers; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Farmers' Financial Difficulties.
6.
To assist farmers who are in financial difficulty but who can regain viability with the aid of a reduction in interest charges the reduced interest scheme for farmers in severe financial difficulty was introduced in April 1982 by my Department in conjunction with the associated banks and the ACC. The scheme is administered entirely by these lending institutions and my Department are not involved in deciding on the eligibility of individual applicants. It is very important to stress that, because people often come to me saying that the banks told them that my Department decide on eligibility in regard to these schemes. It is the lending institutions who decide this.
After taking account of farmers who applied to more than one of the financial institutions, about 8,200 farmers applied for this relief and some 6,400 have so far been deemed eligible by the lending institutions concerned, in accordance with the terms of the scheme. Of this number, some 4,400 are receiving benefit.
Detailed statistics of the type requested by the Deputy are not available to me.
Obviously about 2,000 farmers were not deemed eligible under this scheme and only 4,400 received benefits. The last time this question was raised I pointed out to the Minister the serious implications for agriculture ——
A question, please?
On that occasion I asked the Minister if he would appoint an officer in his Department to oversee the scheme. He now says his Department are not involved. Would the Minister give a commitment that he will appoint an officer of his Department to oversee this scheme and to put special pressure on the financial institutions to ensure that these loans, which are putting farmers out of business because they cannot meet their interest repayments, will be restructured on a long term basis? Their collateral is very good and there is no reason why restructured loans cannot be provided for 99 per cent of farmers ——
The Deputy is making a speech.
Will the Minister appoint an officer to oversee this scheme?
Since the Deputy raised this question before we have had close co-operation with the lending institutions. Of the 8,200 who applied. 6,400 were approved. It appears that 1,800 farmers did not qualify for inclusion in the scheme for a variety of reasons. Some were not in severe financial difficulties. In the second case the borrowings did not qualify for aid under the scheme. In the third instance, even with the aid of the scheme they could not become viable. Other reasons included net assets being in excess of £200,000 or land purchase being in excess of 120 acrea. Because the farmer must furnish his reconstruction plan before he can be granted the interest relief, only about 4,400 applicants out of the 6,400 applicants are so far receiving benefit. The remaining 2,000 include those who have not yet submitted plans to the lending institutions, those who have not yet accepted the offers sent to them and those who are still in negotiation with the lending institutions on their applications. People who might have been successful have not followed up their applications.
(Limerick West): Has the Minister any plans to rescue the small number of farmers who will not reach viability under the terms of the scheme? What is the cost of the scheme to his Department this year? Surely the Department must have an input.
We have a major input and we consult regularly with the lending institutions involved. It is estimated that the scheme will cost the Department of Agriculture £30 million.
(Limerick West): What about the farmers who will not reach viability?
It is a very difficult situation. I wish somebody would advise me as to how their problems might be overcome. There are an infinite number of reasons for people being in serious financial difficulty and it would cost a tremendous amount of money to solve that problem. I am open to any reasonable suggestion but I have not as yet heard one.
The Minister was asked to widen the scope and to consider independent banks outside the national banking system. Has anything been done in that regard?
I was advised that it could not be extended to any other lending institutions, that these were the only ones which were volunteering.
I call Deputy Wilson for the last supplementary.
Has the Minister not got definite knowledge that some of these banking institutions gave the most appalling advice to farmers about selling off the seed corn, so to speak, of their holdings before this scheme came into existence? Is he satisfied that this type of institution is the right one to make a decision as to whether a farmer should get aid?
I agree that some appalling advice has been given in the past and many of the people who gave this appalling advice are not now being very forthcoming when it comes to making a settlement.
(Interruptions.)
I am moving to the next question.
As the person who put down the question, may I ask a final supplementary?
Deputy Noel Treacy has intervened on practically every question today.