The Department of Agriculture, Food and the Marine is to receive additional funding of €64 million for 2019, Minister for Finance Paschal Donohoe announced in his budget speech.
Mr Donohoe said he recognised 2018 has been “a difficult year for farmers” and warned that 2019 added further uncertainty due to Brexit.
“With that in mind,” he said he was renewing the existing stock relief measures for a further three years.
The Department of Agriculture would also provide supports for capital investment in the food industry, aimed at increasing competitiveness and innovation, with additional supports for Bord Bia marketing and promotion activities, he said.
Mr Donohoe said Minister for Agriculture Michael Creed would bring forward a comprehensive package of Brexit response measures for the remainder of 2018, amounting to more than €50 million.
For agri businesses, Mr Donohoe outlined a €300 million loan scheme between the departments of agriculture, and business, enterprise and innovation which is to be aimed at small and medium-sized enterprises, including food businesses, given their “unique exposure to the UK market”.
In a further move related to farm diversification and use of land for renewable energy, Mr Donohoe said leasing of agricultural land for solar panels would be deemed a “qualifying agricultural activity”.
The move will make the land eligible for Capital Acquisitions Tax (CAT) and Capital Gains Tax (CGT) relief. The initiative is subject to the panels covering no more than 50 per cent of the total farm holding.
To facilitate the inter-generational shift in farm ownership and management, he said he was maintaining “stamp duty relief” at 1 per cent for inter-family farm transfers for a further three years.
The exemption for young trained farmers from stamp duty on agricultural land transactions is also to continue.
More support
IFA president Joe Healy said Mr Donohoe had shown “some acknowledgement” of the income difficulties in agriculture, but issues such as Brexit would require “much more Government commitment and support”.
He said funding of €20 million through a pilot scheme for suckler farmers was a recognition of the income crisis in the sector, but the level of funding was disappointing.
He welcomed the increased income support for farmers on marginal land – funding of €22.7 million – to bring the allocation to €250 million, but said IFA would continue its campaign for funding to reach €300 million “as it is vital for low-income farmers on marginal land”.
Mr Healy criticised a €200 increase in the Earned Income Tax Credit to €1,350, saying it does not go far enough. “It is simply not right that a farmer earning €16,500 will be paying €300 a year more in income tax than a PAYE employee next year,” he said, arguing that the Government has reneged on a commitment to reach parity by 2018.
He said the medium-term outlook for agriculture was “very uncertain” given policy and trade issues and the budget did not adequately recognise this.
ICMSA president Pat McCormack said the budget provided “no signal that Government understands the scale of the farming challenge”.
He said incomes were predicted to fall by 50 per cent this year while “transformational” challenges could follow Brexit in March 2019.
‘Throwing shapes’
Mr McCormack said farm families can only conclude that the Government has decided that it doesn’t want to support them, and the agenda seems to be about enhancing the position of corporate structures and big business over family farms.
“Introducing new schemes with more conditions and more inspections along with tweaks of existing schemes won’t solve the massive underlying problems and is simply ‘throwing shapes’ rather than providing real solutions for the farming community,” he said.
Fianna Fáil’s spokesman on agriculture Charlie McConalogue claimed the party had secured the enhanced suckler and ANC funding in the budget.
Mr McConalogue said his party has secured “the first in a series of improved payments for the suckler sector” sending “a clear message that the State values suckler farming and the massive economic benefits it brings to rural Ireland”.
