The Irish Farmers' Association (IFA) today said it will go to court to defend beet growers' compensation following the closure of the Irish sugar industry last May.
Irish Sugar's parent company, Greencore, launched a legal challenge to Agriculture Minister Mary Coughlan's decision to allocate €47.1 million in EU restructuring aid to farmers and contractors. The remainder of the €145 million was allocated to Greencore.
The company believes they were due a higher percentage of the fund and allege before the High Court that it the Government had engaged in unlawful interference and displayed objected bias.
But IFA president Padraig Walshe today revealed that senior counsel had been retained to protect the interests of 3,700 sugar beet growers.
"Greencore has refused to submit a plan on the basis of the minister's decision of July 12th on the EU Restructuring Fund, and if this results in the minister's inability to submit to the EU Commission an application for funding, the IFA on behalf of sugar beet growers will seek full compensation from the parties responsible."
Greencore accuses the Government of unlawfully interfering in directing the company's allocation of the compensation. The Irish State has a shareholding in Greencore.
Fine Gael agriculture spokesman Denis Naughten today criticised Ms Coughlan's handling of the deal.
"If she thought that awarding the company 70 per cent of the available funds would avoid legal action then her tactics have since been proven to be fatally flawed.
"Now farmers have got the worst end of both elements of the compensation deal. They are to get a small share-out of the compensation, the payment of which will be delayed by this court challenge," Mr Naughten said.
In early July, the Government announced it was awarding €98 million to Greencore from the restructuring fund with directions that €28.4 million was to be spent on redundancy payments and a further €50 million to be allocated for pension fund requirements and other payments..
It said €20 million was to cover the demolition of the Irish Sugar's factories.
The country's last surviving sugar processing plant in Mallow Co Cork closed last May.