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Minister Coughlan announces detailed arrangements for the €300 million Dairy Processing Sector Investment Fund

The Minister for Agriculture and Food, Mary Coughlan T.D., today officially launched a €300 million capital investment package for the Irish dairy processing sector. The Fund will include €100 million of Government grant assistance. It is designed to stimulate necessary investment in the sector to ensure the long term competitiveness and viability of the dairy industry in Ireland.

Minister Coughlan announced the detailed arrangements for the implementation of the Fund to the dairy processing industry. The Fund is now open for applications, which should be submitted to Enterprise Ireland by 26th October 2006. The key eligibility criteria are that support will be provided for Annex 1 dairy projects only, together with a minimum level of investment of €5m. The Minister was very clear that, subject to these conditions, her Department and Enterprise Ireland would look objectively at what projects would be supported and clearly each project will be fully evaluated for support on its merits.

Minister Coughlan said "In designing the fund I have emphasised the importance of flexibility and inclusiveness, and the objective nature of the fund. The fund will be a competitive call for proposals which will of course be applied in line with EU state aid guidelines". The fund will be limited to support for Annex 1 agricultural products and the Minister said that she believed that there is sufficient scope within this designation to cater for the vast array of current investment needs.

Minister Coughlan said she is confident that the Capital Investment Fund, with direct support from the Government, will reinvigorate the Irish dairy sector. She added that with the necessary commitment, innovation and investment from the Irish dairy industry, the Fund will go a long way towards the development of a modern, competitive, market-focussed and highly efficient food sector in Ireland, as envisaged in the AgriVision 2015 Action Plan.

Commenting at the industry briefing on the Fund Mike Feeney, Director of Food, Enterprise Ireland said: "Enterprise Ireland is delighted to implement the recently announced €100m Dairy Fund on behalf of the Department of Agriculture and Food. The investment package will support the sector in upgrading its capital infrastructure.

14 September, 2006

Notes to Editors

Annex 1

The term Annex 1 refers to the list of products referred to in Article 32 of the Treaty establishing the European Community. Annex 1 lists all agricultural products which could be subject to a Common Market Organisation in the framework of the Common Agricultural Policy.

Brief Outline of the Dairy Fund

Eligible Companies

This fund is open to Enterprise Ireland/Shannon Development dairy processing companies who are:

  • Engaged in the production of Annex 1 Dairy Products for sale, in particular, those products which will result in the development or utilisation of local raw materials, agricultural products or other natural resources.
  • Proposing to spend at least €5m on capital expenditure related to Annex 1 output only.
  • Submitting a project where the output will be Annex 1. Non-annex 1 output is not eligible for support.

Fund Size

The fund size will be €100m. There will be one call for applications closing at 5.30 pm on 26th October 2006. This is a competitive fund.

Eligible Activities

This fund will support Annex 1 Dairy projects where the input and output is categorised as Annex 1. It is the applicant company's responsibility to ensure that this condition is adhered to both in the project proposal and in the implementation of the project.

Eligible Costs

Only Annex 1 related costs will be eligible for assistance as follows:

  • Purchase of new machinery and equipment, including computer software
  • Site development including building costs
  • Technical costs directly related to the planning, preparation and execution of the project are eligible as well as architects, engineers and consultant fees, feasibility studies, the acquisition of patents and licences to up a limit of 12% of the eligible expenditure

Costs incurred after the date of the official launch of the Dairy Fund (14th September, 2006) will be considered eligible for support, provided that the Company has submitted an expression of interest to Enterprise Ireland.

Ineligible costs

  • The acquisition of new or existing premises including land.
  • Costs incurred before the official launch date.
  • Deposits paid prior to the official launch date.
  • Costs of hiring/leasing equipment for production operations.
  • Repairs and maintenance work on existing equipment and machinery.
  • Replacement of like-for-like equipment and machinery.
  • Second hand equipment.
  • Costs of raw materials.
  • Costs relating to marketing/sales/exports of the product.
  • Labour costs in the production process.

Applications

Applications for funding will be invited through a single public call for submission of projects closing on the 26th October 2006 and will be subject to an assessment/selection process. This call will be announced in the National Press.

Application forms and detailed company guidelines are available on the Enterprise Ireland website www.enterprise-ireland.com/dairyfund

For Further Information Please Contact:

Michael Walsh
Press Officer
Department of Agriculture and Food
Kildare Street
Dublin 2
Tel: 6072190
Mob: 086 8055092
Sarah O' Callaghan
Press Officer
Enterprise Ireland
Glasnevin
Dublin 9
Tel: 01 8082377
Mob: 087-1253221

Web: www.agriculture.gov.ie

Web: www.enterprise-ireland.com/dairyfund

"Enterprise Ireland is today meeting with key sector representatives to outline how the fund will work in practice. Enterprise Ireland is committed to working with Irish dairy processing sector to encourage innovation, R&D, and new product development that will lead to production of higher value products for sale on global markets. The fund, combined with Enterprise Ireland's strategic supports, provides a significant opportunity for the Irish Dairy Processing Sector to improve efficiency and cost competitiveness, thereby ensuring its long term viability. Full details of the fund are available online at www.enterprise-ireland.com/dairyfund".

Date Released: 14 September 2006