Joint Committee on the Secondary Legislation of the European Communities díospóireacht -
Wednesday, 24 Mar 1976

Special Aid Measure for Young Farmers.

Chairman

We have discussed this matter at some length in subcommittee and, as a result of these discussions, we have prepared this report. Before going through the report with you, I want to mention that there is a slight change in the figures. The change in the value of sterling has necessitated some changes in the figures which are given in the report. On page 2, paragraph (b) the figure of £6,780 should read £7,080; and in paragraph (c) the figure of £1,905 should read £1,947. Having taken a note of those changes, we can now proceed.

Paragraph 1 deals with the proposal and indicates that this proposal is linked with the Farm Modernisation Scheme. We will have more to say about that later. The proposal arises from the fact that exceptional financial burdens may fall on young men farming on their own account for the first time. It is intended to ease their situation. Paragraph 2 outlines the proposal in the draft directive. All Members will be familiar with that. Paragraph 3 mentions that the proposal has been considered by a Working Party on Agricultural Structures.

Deputy Esmonde

It says: " Although apparently some Member States appear to be opposed to the proposal on principle . . ." What Member States are opposed?

Chairman

Britain and Germany.

Deputy Esmonde

Are there any particular reasons for that? Is it because they are mainly industrial countries or something of that nature and are not so concerned with this problem?

Chairman

The British attitude is that young farmers are just farmers and that is that, and not entitled to any particular consideration.

Deputy Esmonde

It surprises me in view of the Scottish situation. I would have imagined they would have the same sort of problems as we would have.

Chairman

The only thing we can do is to wait for devolution to take care of the Scottish situation.

Senator M. D. Higgins

I want to ask a technical question. Could this in any way cover a situation where a person returns to farming? I am thinking of a situation where a person who was engaged in industrial employment returns to farming.

Chairman

The directive deals with the development of the young farmer who has commenced farming on his own account in the previous five years.

Deputy Esmonde

He must have land, in other words. It is in line with Directive 159. Is that the one that deals with the Farm Modernisation Scheme?

Chairman

It is linked with farm modernisation.

Deputy Esmonde

It is not the retirement scheme?

Chairman

No, the Farm Modernisation Scheme. You will note that some changes are proposed in the original draft. Some Member States would be free to fix an age limit not exceeding 40 years. The minimum investment level even to qualify for special aid would be raised to about £7,080 now. The total amount of the special aid would be about £1,947, but subject to that limit Member States would be free to relate the level of aid to the amount of the investments envisaged in the development plan. The aid would be paid over three years instead of five at rates of 40 per cent, 40 per cent and 20 per cent.

Deputy Esmonde

I take it that these must be farmers who fall within the category of development farmers as such. You have got the three. You have the transitional, the development and the commercial categories under that directive.

Chairman

They must have a development plan approved.

Deputy Esmonde

Yes.

Chairman

Paragraph (4) deals with the views of the European Parliament and the Economic and Social Committee. Both have considered the original proposals from the Commission and have reported favourably on them. The European Parliament has pointed out that the measure would only apply to a very small number of farmers.

Then we come to our report in paragraph (5). We are generally in favour of the principle behind the proposal. I might mention that this sort of proposal is very important in our circumstances, because we are anxious to keep young people in farming if possible, but we are not too happy about the fact that it is set in the context of the Farm Modernisation Scheme and is confined to young farmers who are operating a development plan under that scheme.

Deputy Staunton

We will have to have major reservations. I think the Joint Committee in expressing this viewpoint is absolutely correct. It is welcome in principle, in my judgment, especially because of the fact that in the context of the Irish agricultural structure it would encourage the handing over of farms at an earlier stage to young people, where there is a direct financial incentive for that to take place, but one would have to have the greatest reservations, because of the fact that it would appear to be confined to farmers who are not operating a development plan on farms that are under the size which is necessary for development farmer's status or for operating development plans, you can have very good farmers working there. In the West, you have extremely few people qualified due to the acreage of their holdings, and the valuation of their land or other criteria. It means that this scheme excludes them completely and I think the Committee are absolutely right in suggesting that the scope should be widened for that reason. It is essential to press extremely hard to open the scope.

Let me proceed to the third point the Joint Committee has noted, about the minimum level of the investment needed to qualify being increased as suggested in the amendment. Certainly, if there are Member States who want to increase it, give them the authority to do so if they choose, but equally, in so far as we are defining farmers into categories, I think Member States should be given some capacity to include those farmers whom they choose to include in it. It is a very good scheme but having regard to agricultural structure in the lesser developed parts of this country, especially in the counties with a small farm size structure, it is going to be less than useless unless the scope is widened so that they can be included under it.

Deputy Esmonde

I appreciate that but there are other schemes providing assistance for areas of that nature. There is another problem that has now raised its head. I am talking about my constituency in the sense that there is a different farming structure there to the structure in the West. There are larger holdings and possibly the land is more viable, and gives a greater number of options in agricultural activities. But a matter has recently come to light. It is this. You could have a moderate size farm and qualify as a development farm if you are in dairy farming because there is a far better income from it and you can bring yourself within the category; but if you are indulging in mixed farming and dry stock——

Chairman

Indulging?

Deputy Esmonde

——operating that kind of farming. It has happened in quite a few cases that those sort of farmers do not qualify as development farmers whilst one would imagine that they would normally qualify in regard to the size and the amount of stock. But when the instructor comes to draw up the plans and make his projections on income over this period of five years under the Farm Modernisation Scheme, he finds that he cannot bring the income up. This has become a bit of a problem, where a farmer has been hit by brucellosis. Actually he does not want to touch that kind of dairy farming again; he has lost enough as it is. We have the situation where there are farmers who should normally qualify, for their size and the amount of investment as development farmers. They do not, because of the projected cash providing an income. This scheme is probably assisting some in a large way, where there is a particular activity involved, but it does not actually get to the real problem that is referred to here in this paragraph. It needs improvements on this section of the scheme.

Chairman

So what you say, really, is reinforcing the argument.

Deputy Esmonde

Yes. But I want to make a distinction as between the case that was made by Deputy Staunton who is dealing with different circumstances. These difficulties arise in some areas.

Chairman

So that the Farm Modernisation Scheme needs to be adjusted not alone for the West but in general?

Deputy Esmonde

Yes. There might have to be a different sort of guideline as to who qualifies as a development farmer.

Deputy Staunton

It does not necessarily mean that the Farm Modernisation Scheme must be redesigned so that this can be included. The Farm Modernisation Scheme does not depend entirely on the qualification of development farmers. It is not a prerequisite that a young farmer should be in the category of development farmers. This is a separate issue.

Chairman

Can I take it then that the report is agreed? You will notice that the proposal is expected to come before the Council in April again. We are very grateful to the Irish Farmers' Association for their assistance. We will keep on eye on the scheme with amendments from the Council and have another look at it.

Paragraphs 1 to 7, inclusive, agreed to.

Draft Report agreed to.

Ordered: To report accordingly.