Farmers quick off the mark with pre-Budget lobbying

Key demands include improving land mobility and protecting farm schemes

 

Talking about the Budget at the height of summer seems a bit premature until you remember that the Budget has been brought forward from December to October this year. The new date complies with an EU-wide process of budgetary surveillance but, happily for Minister for Finance Michael Noonan, it will also rob headline writers of the opportunity to describe him as bad Santa, or the Grinch who stole Christmas.

The farm groups are always quick off the mark when it comes to lobbying and ICMSA hit the blocks early this year, lodging its pre-Budget submission with Mr Noonan in June. IFA publicised its package of requests last week and Macra na Feirme and the Irish Cattle and Sheep Farmers’ Association (ICSA) are putting the finishing touches to their submissions.

They will all be hoping for a better Budget than last year when more than 100 farmers protested outside the Department of Agriculture over what they called “savage cuts” to the sector. That Budget was characterised by the expected shutdown of the suckler cow welfare scheme and cuts to the disadvantaged areas scheme, the sheep grassland scheme and Farm Assist, an income support scheme.


List of demands
Farm groups caution against any further cuts to schemes, particularly in the wake of the difficult winter and the ensuing fodder crisis. IFA says farm schemes have been disproportionately targeted for reductions in recent budgets. It notes that the Department of Agriculture had its budget cut by 13 per cent since 2011 compared with an average five per cent cut for all Government departments. Farm schemes bore the brunt of those cuts, with spending back by 18 per cent over that period, according to IFA president John Bryan.

ICSA’s general secretary Eddie Punch says farmers have to shout stop when it comes to the trend of cutting the disadvantaged areas scheme. “Budgetary constraints have meant that farms in excess of 22 hectares did not qualify for the AEOS agri-environment scheme which really calls into question whether the Government is serious about enhancing the environment,” he says.

Also high on the list of demands are measures to encourage the transfer of land from non-productive to productive farmers. There are more farmers over the age of 80 than under 35 in this State and access to land is still a major barrier for young farmers, according to Macra na Feirme.

It will be proposing several measures to encourage the transfer of land, including the retention of 90 per cent agriculture relief and no reduction in the thresholds for capital acquisition tax and capital gains tax.

This point is also raised by ICMSA with its president John Comer highlighting “serious concerns” about Government policy on capital taxes in recent budgets. He says there has been a 65 per cent increase in the rate of capital gains tax and capital acquisitions tax since October 2008. When a reduction in thresholds is factored in, it represents a significant disincentive to the transfer of land.

ICMSA is calling for a retention of the
1 per cent stamp duty rate for transfers to close relatives and, where a farmer acquires land to create a viable holding, it says the stamp duty liability should be off-set against income on farm profits.

Changes to the means test for third- level college grants may not have been introduced for the coming academic year but they are still bubbling away in the background and the farm groups have restated their opposition to the inclusion of working farm assets in the means test.

Earlier this month, Minister for Education Ruairí Quinn told the Oireachtas Committee on Education that a capital asset test for student grants could make savings of about €6 million. But he made a “very clear distinction” between the working capital cash needed to continue running a farm and cash reserves.

IFA president John Bryan says the planned changes to the scheme are a sig- nificant source of stress for some families. “It would be absolutely unfair to take capital assets into account and it would discriminate totally against the agricultural sector and a lot of business people who are heavily borrowed with low income and struggling to survive,” he says.

Still on the educational theme, Macra na Feirme highlights the impact of the staff recruitment embargo on Teagasc. The surge in numbers attending agricultural colleges has been well documented and the young farmers’ group is calling on the Government to give more flexibility to Teagasc and allow it to hire the required staff.

All farm groups highlight the value of the agri-food sector to the economy and the need to foster that growth. Food and drink exports passed the €9 billion mark last year and the latest Bord Bia figures show this upward trajectory is continuing. This success will undoubtedly be referenced by the Minister for Finance in his Budget speech but farmers will want to know what he intends to do at farm level to foster that growth.