Specific Details
IFA Budget 2023 Submission-Measures to mitigate increased cost of production and general inflationary pressures
Intended results
FARM SCHEMES
- To incentivise re-planting of additional area secured in 2022, and to further increase cereal production in 2023, a half/discounted rate of €200/ha should be paid on land that remained in tillage production for year 2, with €400/ ha again being paid out on any new/converted land to tillage crops for the forthcoming season
- Existing rates involving growing of protein crops; multi-sward species (incl red clover) should be maintained for newly sown crops
- The €1,000 payment ceiling payment must be re-visited in recognition of those farms with higher stocking levels, with payments made in full for all hectares claimed.
- To preserve the integrity of support measure, farmers who lease land for defined short-term periods purely to cut hay/silage crops from, should be eligible for payment even where such lands were not included within the individuals 2022 BPS application
- Given dairy producers incur similar inflated input costs as other farm producers, IFA propose that they too should be considered eligible for the scheme in its future design
- Scope of the scheme should be extended to include growth of Winter catch/fodder crops
- Existing rates should be maintained for newly sown high-wire crops; field vegetables; mushrooms and apples
- Scheme should be extended to include soft fruit growers (especially those with heated gas) given these producers are also exposed to inflationary input costs as all sectors and those with heated glass even more so
- In order to address both the current crisis and the long-term volatility challenge within the sector the Irish Farmers' Association (IFA), Meat Industry Ireland (MII), and the Irish Grain and Feed Association (IGFA) are jointly proposing the immediate establishment of an initial €100m Pig Stability Fund in order to save the Irish pig sector from irreparable harm.
Fund Outline - The following is an outline of the key aspects of this proposal
- Establish, without delay, a state-administered fund to provide an immediate cash injection to pig farmers to avoid the demise of the sector at primary and processing level
- This fund will be jointly funded by a state contribution along with a long-term fund sourced by way of a new statutory levy
- Introduce a statutory levy of 90 cent/pig (equivalent of c. 1 cent/kg) on all pigs slaughtered in the Republic of Ireland or exported to Northern Ireland. Based on the 2021 output, this would generate a revenue stream of c. €3.6m/annum (based on output of c. 4m pigs/annum)
- Based on a 14-year payback period, this constitutes a direct farmer contribution of c. €50m
- Commitment from the State to initially fund the farmer contribution of €50m along with an additional upfront funding from the State of €50m. The former will be repaid by the revenue from the newly-established statutory levy.
- Levy to be compulsory on all farmers producing finished pigs within the sector.
Proposed Fund Payment Model
- The pig stability fund will only be deployed during periods where the industry is experiencing significant losses. These losses will be calculated based upon independent Teagasc analysis, with payment made via monthly direct transfer to farmers based on number of pigs sold in previous month. Payment based on estimated Teagasc losses per pig for reference month
Benefits of Proposed Fund Structure
- The proposed fund facilitates the creation of a volatility management mechanism for the sector to help make it more economically sustainable in the medium-term
- The design of the fund ensures that if and when the pig sector returns to profitability payments from the fund cease
- A significant level of direct farmer funding is proposed to part-finance the fund
- Detailed inventories on fertiliser/fuel/feed stocks must be completed as a matter of urgency.
Taxation measures to mitigate the increased cost of production
- Given agri-diesel is up to two and a half times normal levels, and a return to normalised levels is unlikely in the short-term, an extension of existing excise duty relief on agri-diesel & LPG for farm use is required to reduce production costs at farm level
•- Retain section 664A of the Taxes Consolidation Act 1997 and extend to include agricultural contractors to mitigate the increased cost of production
- Suspension of LPG/carbon tax for 2022 and 2023 for farmers and agri-contractors. Alternatively, any forecast increases in LPG/Carbon tax as per Finance Act 2020 should be deferred to periods outside peak agricultural activity
- The Government must honour commitments made in their Programme for Government Our Shared Future to ring-fence €1.5bn of carbon tax receipts, over the next ten years for agri-environment schemes.
- Glasshouse growers of food crops using CO? enrichment, should be granted a Carbon Tax relief/rebate.
- Where actual / estimated business losses are incurred as a consequence of inflationary input price pressures, consideration should be afforded to introducing a debt warehousing mechanism for impacted farmers, similar to that employed in response to the Covid-19 pandemic
- The above temporary income tax measures are retained and available to assist farmers adversely impacted by inflationary input price pressures;
- A permanent retention of 2 ‘step-out' years per 5-year cycle is provided for, where a farmer is allowed to ‘step-out' of income averaging more than once in a five-year period (once they are not carrying an unpaid deferred tax amount from a previous ‘step-out'). For example, if the farmer ‘steps out' from income averaging in Year 1 and repays the deferred amount in Years 2 and 3, they should be eligible to ‘step-out' again in Years 4 or 5 of a cycle.
- All existing stock relief measures (incl. Enhanced Stock Relief for Young Trained Farmers and for Farm Partnerships) should be maintained and available for at least a further 3 years
- The general stock relief of 25% relief should be temporarily increased to 50% until 31st December 2023 to prevent tax issues for farmers in a year of high costs and poor cashflow.
Social Protection Measures
- The income disregard for farm income and income from off-farm self-employment be reduced from 70% to 50%.
- Similar to recipients of the Jobseeker's Benefit and Jobseeker's Allowance, recipients of Farm Assist should receive credited social insurance contributions for pension purposes.
- The capital assessment disregard should increase from €20,000 to €36,000 to better align the scheme with other social welfare schemes.
- In the means test the depreciation rate for farm equipment and machinery should be increased to a standard rate of 10% to more accurately reflect the useful life of these assets.
- The option of a three-year income test assessment be considered.
- The new a new, statutory Home Support scheme needs to be introduced as a matter of urgency and adequately funded to support older people to live at home.
- In the interim older people need to be supported to live at home through increased funding for the Home Support Service so that the number of hours provided is increased.
- The Total Contribution Approach (TCA) for calculating Contributory State Pension payments should be implemented in line with National Pension Framework (2008) agreement, which provides for total contributions of 30 years to qualify for a maximum payment.
- Social insurance credits should be provided to farmers on Farm Assist prior to 2007, when they were ineligible to make PRSI contributions under the scheme.
- The new Workplace Pension Scheme must be extended to include farmers and other self-employed people, with every €3 saved by a farmer, a further €4 will be credited to their pension savings account by the Government.
- The rate of Class S PRSI is retained at existing levels.
Banking
- The Government, through the SBCI, introduce a state backed guarantee (80%) low-cost interest (max 2.95%) loan scheme, which is accessible to all primary producers across all the farming sectors including aquaculture, forestry and amenity horticulture. • The scheme should
- The scheme should o Provide financial support to primary producers who are experiencing cashflow disruption and/or reduced profitability due to inflationary input prices. o Operate through the main banks as heretofore with previous SBCI schemes, but also to include other financial institutions such as Credit Unions, An Post and other accredited asset lenders. o Cater for loans up to €1,500,000 in the form of refinancing, working capital and term loans in addition to asset finance.
- cont'd; o Provide for a 12-month moratorium on capital repayments. o Allow access to farmers who are leasing land and therefore are unable to provide adequate security to access secured bank finance without support of SBCI-led schemes. o Preclude the use of family homes as security. o Preclude the use of personal guarantees for loan amounts under €150,000. o Prohibit facility fees.
Name of person primarily responsible for lobbying on this activity
Tim Cullinan IFA President, Michael Biggins IFA Rural Development Chairperson, Rose Mary McDonagh IFA Farm Business Chairperson, Shane Whelan IFA Senior Policy Executive, Denis Griffin IFA Senior Policy Executive
Did any Designated Public Official(DPO) or former Designated Public Official(DPO) carry out lobbying activities on your behalf in relation to this return? You must include yourself, and answer Yes, if you are a current DPO or a DPO at any time in the past. (What is a Designated Public Official?)
No
Did you manage or direct a grassroots campaign?
Yes
What is the directive you gave to the grassroots campaigners?
To lobby members of the Oireachtas on the contents of IFA's Budget 2023 Submission,
Was this lobbying done on behalf of a client?
No
Mass communications
Letter All TDs
Submission All TDs
Letter All Senators
Submission All Senators
Lobbying activity
The following activities occurred for this specific Subject Matter Area.
Designated public officials lobbied
The following DPOs were lobbied during this return period on this specific Subject Matter Area. These DPOs were involved in at least one of the Lobbying Activities listed above, but not necessarily all of them.
As returns are specific to a Subject Matter Area the above Lobbying Activities may be associated with multiple returns.
Charlie McConalogue
Minister (Department of Agriculture, Food and the Marine)
Paschal Donohoe
Minister (Department of Finance)
Michael McGrath
Minister (Department of Public Expenditure and Reform)
Mary Lou McDonald
TD (Dáil Éireann, the Oireachtas)
Matt Carthy
TD (Dáil Éireann, the Oireachtas)
Maria Byrne
Senator (Seanad)
Martin Heydon
Minister of State (Department of Agriculture, Food and the Marine)
Joe O'Brien
Minister of State (Department of Rural and Community Development)
Heather Humphreys
Minister (Department of Rural and Community Development)
Catherine Martin
TD (Dáil Éireann, the Oireachtas)
Anne Rabbitte
TD (Dáil Éireann, the Oireachtas)
Mary Butler
TD (Dáil Éireann, the Oireachtas)
James Browne
TD (Dáil Éireann, the Oireachtas)
Helen McEntee
TD (Dáil Éireann, the Oireachtas)
Peter Burke
Minister of State (Department of Housing, Local Government and Heritage)