JOINT COMMITTEE ON SOCIAL AND FAMILY AFFAIRS díospóireacht -
Wednesday, 25 Jun 2008

Farmers Enterprise Assistance Initiative: Discussion.

Chairman

I welcome Mr. John Pierse, chief executive officer of the South Kerry Development Partnership Limited, Mr. Patsy Cronin, chairman, Mr. John O'Connor, chairman, agriculture sub-committee, Ms Joan Collins, director, Mr. James McCarthy and Mr. Joseph McCrohan, RSS manager.

The delegation has travelled far from south Kerry. The committee was to meet the delegation several months ago but could not due to problems scheduling other meetings. I know the South Kerry Development Partnership Limited has done great work in south Kerry. I hope the committee will be able to assist it in doing this work.

I draw the delegation's attention to the fact that while members of the committee have absolute privilege, the same privilege does not apply to witnesses appearing before it. Members are reminded of the long-standing parliamentary practice that they should not comment on, criticise or make charges against a person outside the Houses or an official by name or in such a way as to make him or her identifiable.

Mr. John Pierse

This has been a very successful scheme. Out of 56 participants, 70% of them are still in business. It has saved the Government €400,000 over six years and will continue to do so as the participants no longer receive social welfare payments. We are accompanied by Mr. James McCarthy, a participant in the scheme, whose experience is the proof the scheme works.

Mr. John O’Connor

I thank the Chairman, Deputies and Senators. The Chairman will remember the famous day in 1997 when he, along with Deputy O'Donoghue and Deputy Breeda Moynihan-Cronin, met the Minister for Social, Community and Family Affairs, Deputy Dermot Ahern, to secure the scheme. Subsequently, Mr. Brian Flynn has delivered the scheme which has been very successful.

Mr. Joseph McCrohan

My role in the South Kerry Development Partnership Limited is to deliver the farmers enterprise assistance initiative scheme launched on 11 November 1999 by Deputy O'Donoghue. Farm incomes in 1996 in the south Kerry area were more aligned to those in the west than in the east. It was a pocket of County Kerry where farm incomes were very low. In 1996 the average income was between £1,000 and £4,000. Between 2001 and 2006, I contacted 800 farmers in the area to outline the benefits of this and other schemes as part of my work under the social inclusion programme funded by Pobal.

The farmers enterprise assistance initiative is a six-year back-to-work allowance for farmers. Farmers on farm assist prior to 1996 were not in a position to join the area enterprise back-to-work schemes. Through the work of this committee, they became eligible to join. Through the pilot programme, 56 farmers are on the scheme in south Kerry. The Department of Social and Family Affairs has informed us that no other part of the country has any farmers on this scheme. The main bulk joined in the first three years of the programme. Later, numbers began to tail off as the Department requested us to stop taking on new entrants. We negotiated with the Department to secure six more places.

The scheme has been successful for many of its participants. For example, one farmer who had 20 suckler cows but was not in REPS joined the scheme and began a stonework business and purchased a van. Since then he has joined REPS, moved his herd number to 27 cows and is now part-time farming with his new business. The farmer informed me that his daughters would not have gone to college if not for this scheme.

Mr. James McCarthy, who has accompanied the delegation, has 12 suckler cows and has gone into organic vegetable production which he sells to the Milltown mart. From a bachelor's point of view, he enjoys the social aspects of the scheme as well as the extra income. With rural isolation becoming more of an issue, this type of scheme is very important.

Another farmer, a married man with four children, had six cows and 180 ewes. He was a participant in a community employment scheme. When it was wound up he moved on to the farmers enterprise assistance initiative. In rural areas, PAYE employment is hard to get, so this was an ideal route to employment for this farmer. He subsequently got a full-time job, his family continue the business and he and his wife run the farm.

The partnership scheme continues the culture of self-employment which we believe is the new way people will generate incomes in rural areas. The scheme has reduced dependency on State supports and fosters a culture of self-employment. It gives options for farmers when they are asked to leave a community employment scheme. The options for farmers are limited. PAYE employment, community employment and rural social schemes are either full or limited in time and income. This programme is not limited in time or income, allowing a farmer to progress in employment.

With the Department of Social and Family Affairs, South Kerry Development Partnership has invested huge resources in the scheme in terms of my time, the enterprise officer's staff time, grant aid we provide under the local development and social inclusion programme, the Leader programme and the Accel programme. The review carried out by the Department of Social and Family Affairs indicated that the scheme was an excellent measure in combating rural poverty. Over 70% of farmers have been successful. The programme is cost effective. Participants have moved from receiving State aid to paying tax and making pension contributions. The scheme has allowed farm families to continue their agricultural business. South Kerry Development Partnership believes it is very important that farmers do not walk away from their farms and that, with their new business, they continue in farming. The report recommended that the scheme be extended.

On further analysis by the Department, of the first 23 people who finished the programme, 12 are still in business, two are participating in the rural social scheme, one has a full-time job, two have passed away, three have not returned to the farm assist programme, while three have. The total welfare saving over the six years is €159,490. That sum can be multiplied to include the figure of 56. It must be remembered that the savings are ongoing.

On the position of farmers in south Kerry, 350 could start if the scheme was available. Farmers participating in the farm assist scheme do not qualify for the newly launched community service programme. A total of 163 farmers are participating in the rural social scheme, all of whom we anticipate will have to leave it at some stage to allow others to join, even though they have no clear progression route. Approximately 100 or more farmers participating in the community employment scheme will have to leave that scheme also.

The IDA is not in a position to create employment in south Kerry. As members are aware, the building industry is declining. In some parts of south Kerry 30% of the workforce are engaged in the primary agriculture sector. The national average is 6%. Members will understand, therefore, the difficulties we face.

South Kerry Development Partnership is delighted with the outcome of the review. It strongly supports the extension of the programme in south Kerry. It acknowledges the dedication of the participating farmers, the Department of Social and Family Affairs in particular, and all other agencies which supported the pilot programme.

I thank members for their time.

Mr. James McCarthy

I have been participating in the scheme for six years and have now completed it. I was very happy with it, as it helped me to set up my own business, for which I was given grants. My aim was to have the farm assist scheme replaced but I am now making triple what I made under that scheme. I can get by without it. There is a community aspect to the issue in that I am working in my own community among my neighbours. We are all working together. It is a great scheme.

Mr. John O’Connor

Mr. McCarthy might explain the position for his nephew and brother.

Mr. James McCarthy

My nephew will probably take over the business at some stage. He is only 16 years old but appears to be very interested in it.

Mr. John O’Connor

That explains the success of the scheme. We have helped a man who was in receipt of social welfare to set up on his own. I have a document from the Department of Social and Family Affairs that indicates that the savings made on social welfare amounted to €159,490 up to last September.

Mr. John Pierse

For 23 people.

Mr. John O’Connor

That is the amount the Department saved in six years and it does not take into account the tax and PRSI payments the people concerned will make. It is a win-win. Ms Collins can outline the position to the committee. She participates in the four year back to work scheme, as well as ours. She is chairperson of the enterprise committee which places people on the scheme. She might tell members the number who were successful on the four year as opposed to the six year scheme.

Ms Joan Collins

A total of 70% were successful on the six year scheme. We only have rough figures because the Department does not appear to have any figures for the numbers who remained on the scheme. The enterprise officer, Ms Anne O'Riordan, and I did a rough count and believe the outcome would be approximately 10% in terms of the number who were successful on the four year scheme.

Mr. John O’Connor

People are asking us the reason there is a six year scheme in place and why we do not accept the four year scheme. The reason is that a farmer and a PAYE worker are different. First, the farmer is going into business. He or she has a farm behind him or her. If he or she becomes involved in that business, he or she must put up collateral. If another person goes into business, he or she does not have collateral and there is a concern in that regard. Second, the farmer must balance the work he or she is doing at home to become involved in the business full time.

National statistics indicate that farmers in that age group have a lower standard of education. They have had no formal training in work practices and so on. It is totally new to them. Mr. McCrohan mentioned a figure of 350. There are 400 participants in the farm assist scheme in County Kerry, every one of whom will not take up a job. We have 50. Fair play to Mr. McCrohan who encouraged the people concerned to commit. With much persuasion and hard work, he got them involved and the amount of money mentioned has been saved. The farmer is different because he or she is living in an isolated, rural area and working in a different environment. That is the reason the scheme is different.

We are asking for a full-time officer to be appointed. There is much talk about emigration but we do not want to hear that word. We want people to start working and stay at home. If someone wants to make a comparison between a farmer and an ordinary PAYE worker involved in the back to work scheme, they are comparing a pot and a kettle. They are totally different.

People in County Kerry have the second lowest amount of disposable income. I am aware that the Chairman fought tooth and nail to have the county granted Objective One status but due to our links with County Cork, we could not get it. We want to have a vibrant rural countryside but the majority are beef or suckler cow farmers. As everyone is aware, according to Teagasc, the income of beef farmers is at a figure of minus 5. The only thing that is keeping them going is the cheque in the post which, as we are all aware, will soon come to an end.

We have shown innovation. Farmers are taking a leap of faith. We ask that the scheme be continued and expanded into north Kerry, west Cork and south or west Limerick where many members of the farming community do not have access to IDA assisted jobs. We give a guarantee that the Department will not be at a loss. It will be a win-win. If anyone wants to know about the matter, he or she should ask Mr. Brian Flynn from the Department of Finance. I have spoken to him and he cannot believe the results we have achieved.

I thank the committee and invite questions from members.

Mr. Patsy Cronin

The board of the South Kerry Development Partnership is very pleased with the work the committee is doing. It is imperative that it be allowed to continue because from the statistics the gentlemen have presented today it is vital for the people of south Kerry. As Mr. O'Connor said, the IDA has not delivered any jobs in the region over a long period. As a trade union official for 30 years, I am aware that south Kerry is a deprived area that needs continued support. This is an excellent programme which should be continued.

Mr. John O’Connor

Deputy Carey would like to see it introduced with respect to the Shannon region.

Senator Larry Butler

I welcome the delegation. It is obvious that those who spoke are extremely pleased with the current scheme, the aspect of which I support is self-employment. The members of the scheme are independent and not asking anyone for money. They are delivering a service. It is important that we continue to support them.

I would like to see the scheme developed. A certain amount is being done but much more could be done. The delegation is ideally placed for the development of organic food. It could develop local markets in the area and there is much to be done in that regard. The presentation referred to the building trade being on the slide in the local area. However, there is still business in the renovation of housing and in the area of energy conservation. New technology such as wood pellet boilers provide the opportunity to move away from oil dependence and there is nobody better than the small farmer for thinking of ingenious ways of looking after themselves. We must support groups such as this because these are the people who keep the countryside for us. When we travel we like to see the countryside looking well and these are the people who do that work. I take my hat off to the delegation and congratulate it.

Deputy Joe Carey

I welcome the members of the group. The delegation has made a passionate presentation which has outlined its activities in detail. It keeps the local economy going and the people on the land. Any initiative such as this should be supported. I would welcome an expansion of this scheme as this is a pilot scheme. It has been a resounding success over the past six years and this committee should support it. We should propose to the Minister that the scheme be expanded and developed into other areas. Councillor O'Connor referred to County Clare. There are areas along the west coast from Donegal down to south Kerry that could benefit greatly from such a scheme and I would support its expansion. My colleague, Deputy Sheahan is full of admiration for the group.

Deputy Tom Sheahan

I welcome the members from South Kerry Development Partnership. It is great to see them here before the joint committee. I am very proud as a Deputy from south Kerry and they should be very proud of what they have achieved, when one considers what Enterprise Ireland or the IDA spend on job creation and what has been achieved here. Their presentation has been very professional. One man admitted his children would not have received a third-level education but for this scheme. This is what this is all about.

I know some of the farmers involved. One issue not highlighted here is that this scheme tackles rural poverty and rural isolation. This is the Joint Committee on Social and Family Affairs. I know the case of a man who is not a farmer and I hope something can be done for him. He is a single man living on his own and he is an alcoholic. He was on a great deal of medication for depression. Seven years ago he was placed on a community employment scheme. I recently made a submission to the Minister with relevant documentation from his doctor that he is no longer on medication and he has not drank since he went on the CE scheme. However, he has been seven years on the scheme and now he has nowhere to go. The beauty of this scheme is that there is no time limit for participation. As Deputy Joe Carey said, an expansion of this scheme throughout the country would be of great benefit. I am sure west Clare and areas like it would benefit as well.

Mr. James McCarthy found that he could sell twice over what he produces. Kerry County Council has been very proactive in setting up farmers' markets as has South Kerry Development Partnership. If we are to have more farmers' markets, we need more farmers involved. A total of 350 farmers are in the farm assist scheme and they are not there by choice. The single man and the farm family have seen the difference in their livelihood when money is earned. There is great pride in doing something for oneself. I was self-employed before I was elected to the Dáil. I commend the scheme. I hope the Minister will see fit to expand and enhance it so that it can be established throughout the country. Rural poverty and rural isolation are big issues. Every day of the week we hear about such cases and this scheme would go a long way to helping out. Aside from the financial savings to the Department, the social benefits are impressive. I congratulate the partnership and wish it the very best in the future.

Deputy Mattie McGrath

I too welcome the delegation. I have been mightily impressed by the presentation and by the stark realities of the statistics that have been provided. This scheme should be regarded as a pilot scheme and it should be extended to other counties. The Minister and her departmental officials should be invited to attend the committee because this scheme is an excellent method for directing people towards self-employment. The people have shown initiative, it has been of benefit to them and to the families and work has been created. The savings have been significant. Like the CE schemes, the problem is the value for money is too good. I would ask for a value for money audit to be carried out on both this scheme and the CE schemes to prove to the managers in the Department that this is exceptional value for money. It should be noted that the IDA do not go into such places anyway — they do not know these people exist. The cost to Enterprise Ireland of creating jobs is phenomenal. The value for money is too glaring and they are unbalanced by it, in my view. It would be nonsense to discontinue this scheme; it should be expanded and held up to the rest of Ireland as an example of how to go forward. I commend all the members of the delegation.

Deputy Tom Sheahan

I wish to make another point. This scheme was also set up at the time of the closure of the peat station in Cahirciveen and it helped many people who had been dependent on turf-cutting for the peat station. This scheme gave them another avenue.

Chairman

Does Mr. Pierse or Mr. O'Connor wish to make a final response?

Mr. John Pierse

It was wonderful to hear the comments. I strongly believe the alternative to politicians does not bear thinking about. We can be proud of the comments of our politicians around the table today; they got it in one. Some people might take two months to understand it but they got the idea straight away.

We are working on another aspect of organic gardening which will present further opportunities to more farmers. If we are serious about organic farming, then we must get some real farmers involved in it and this scheme will be the opportunity for them to become involved in the project. We are second behind the County Clare crowd but we are doing a woodchip project in the whole of County Kerry. For once, south Kerry and north Kerry agreed. The project will benefit 1,300 small forest owners in south Kerry. I wish to thank members of the joint committee for listening to our presentation. I look forward to the scheme being extended in south Kerry and expanded to areas where they really need it in the west and other areas.

Mr. John O’Connor

It is not too often that people appear before the joint committee saying they will refund money, but that is what we are doing. We are making an effort to get people out to work. The problem, however, is that the departmental officials are asking people to continue with the four-year scheme and put people into this one. They should come back to us if they can show any part of the country where farmers have taken up their four-year scheme. According to the numbers in this graph, we are down to two. We had a lot more people but they would not allow us to put them on and they have not gone on the four-year scheme. The farming community is different — like the kettle and the pot — but it needs this scheme in Kerry, Clare, west Cork, west Limerick and the west generally. I am talking about the kind of people the Chairman likes.

Chairman

I thank Mr. O'Connor for his presentation on behalf of the South Kerry Development Partnership Limited, whose members have engaged in such an interesting discussion. I compliment him on the great work he has done and on what he proposes to do in the future. He will have total co-operation in whatever way we can help. I now ask the Vice Chairman, Deputy Charlie O'Connor, to take charge of the meeting.

Deputy Charlie O’Connor took the Chair.