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Coveney announces spending plans for the Agriculture, Food and the Marine Sectors for 2013

Announcing funding for the Vote of his Department for 2013 the Minister for Agriculture, Food and the Marine, Simon Coveney TD was determined to build on the progress achieved in recent years in developing the agri food sector and, in particular, to further contribute to the future growth and prosperity that the sector can achieve for Ireland, expanding its revenue base through growth in export earnings.

Funding for 2013

The Minister said that the Exchequer contribution to the Vote of his Department in 2013 will amount to some €1.25 billion.  Although constrained by tight budgetary disciplines imposed right across the economy, which originally demanded a reduction of €114 million for next year, the Minister said “I was determined to minimise the impact of the scale of the reduction so that the most important schemes and programmes which the sector relies upon most were protected to the greatest extent possible. I am pleased to say that, through re-orientating and re-scheduling payments, I have managed to fund new schemes and programmes while also reducing the scale of savings to a lower amount of €89 million compared to 2012, while protecting farm incomes. The 2013 budget reflects a significant Exchequer commitment of support for the agri-food sector and is recognition of the contribution which the sector can make to economic recovery and future growth”.

The Voted expenditure for 2013 of €1.25 billion is comprised of some €1.057 billion in current expenditure and €193 million capital expenditure. The downward budgetary movement between 2012 and 2013 of €89 million reflects lower budget requirements for a number of measures. “I was particularly pleased to secure an increased capital allocation in 2013 of some €25 million from the Department of Finance in a period of very scarce resources. This enables a meaningful capital programme to be undertaken, including  funding for some 7,000 hectares of new forest planting”. 

Key Priorities

This year’s Budget is consistent with last year’s Budget in terms of priorities

  • The protection of incomes for family farms
  • Support for small  farm holdings in disadvantaged areas
  • Taxation measures to restructure, modernise and promote growth in the agri-food and farming sector.
  • Providing support programmes  in line with the targets of Food Harvest 2020, in particular job creation
  • Supporting the future of the sector through new research and development funding and through investment in food safety and animal health and welfare controls
  • A continued programme of reform within the Department aimed at continued improvement in service delivery and reducing costs. 

Taxation Measures – restructuring and modernising the agri-food sector 

In addition to direct financial support for the agri-food sector, side by side with that I have secured agreement for a range of taxation reliefs that would link in with the key measures being pursued in Harvest 2020 for the growth and development of the agriculture, food and marine sectors. The main taxation measures in the Budget which will benefit the sector are as follows

  • The retention of the general 25% rate of stock relief for all farmers and 100% stock relief for young trained farmers;
  • A new farm restructuring initiative to allow consolidation of land parcels with the aim of improving the overall efficiency of the combined holdings;
  • An expansion of the foreign earnings deduction scheme which benefits SME’s, to apply where an individual spends 60 days a year developing opportunities for Ireland in certain key markets;
  • The extension of the farm partnership scheme to sectors other than milk production partnerships, subject to State aid approval;
  • Relief from Excise Duty on auto diesel for licensed road hauliers.

“These taxation measures reflect this Government’s commitment to the agri-food industry and in particular to the expansion planned in the Food Harvest 2020 strategy.  They are designed specifically to address key constraints in the sector and ensure that the growth potential of the sector is fully realised” said the Minister

 

Beef -   €25 million continued investment in Suckler Beef

While the Suckler cow scheme 2008-2012, has now come to an end, it has been invaluable in improving the quality of animals produced from the Suckler herd over the five year programme. The Minister said “I was anxious to build on this success and accordingly, I have allocated €10 million in 2013, financed from unspent Single Farm Payment Funds for a new support programme for Suckler beef farmers to participate in a new Beef Data Programme. When taken together with residual payments of €10 million under the Suckler Cow Welfare Scheme, this will amount to €20 million in direct payments to Suckler farmers in 2013. This programme will assist farmers in improving the genetic quality of Irish cattle and will maintain the data flow into ICBF in order to build further knowledge and more rapid progress in breeding and ultimately in profitability for farmers”. In addition, the sum of €5 million has been set aside to support the continuation for another year of the Beef Technology Adaptation Programme, a scheme that provides beef farmers with better information and improved skills to increase profitability on farms.

 

Dairy – supporting new entrants and expansion

The dairy sector continues to perform very well on international markets. New growth projections arising from the abolition of quotas in 2015 will allow Ireland to increase milk output by up to 50% in line with the industry target set out in Food Harvest 2020.  “I am anxious to continue to support this growth. In particular I have provided some €10 million under TAMS (targeted agriculture modernisation scheme) in support of dairy farm modernisation, providing grant assistance of up to 40% for investment in dairy farm facilities”. In addition, although the dairy discussion group programme has come to an end and has achieved its objectives, an additional sum of €1million has been provided to allow a further opportunity to new entrants to participate in this valuable programme that builds organically a level of knowledge of best farming practice, tutored by peers, which has proven extremely popular and beneficial in building greater levels of on farm efficiency.

 

Sheep – new Sheep Technology Adaption Programme and the maintenance of other support schemes

The Minister has provided €3 million to a new Sheep Technology Adoption Programme, which has already proven very successful in both the dairy and beef sectors, with a maximum payment of €1,000 per participant. This is in line with Food Harvest 2020, bringing knowledge to the cutting edge of the sector. Though the Grassland Sheep Scheme was due to expire at the end of this year the Minister said “I have decided to extend it for another year and am providing some €14 million for this purpose in 2013”. The scheme will be funded from unspent Single Farm Payment funds. The Minister is also providing for a continuation of the sheep fencing scheme in the amount of €3 million next year.

 

Pig Sector –   prioritising capital investment and meeting standards

In relation to the Pig Sector, the Minister has already announced a number of amendments to the TAMS Sow Welfare Scheme, and the provision of additional funding of up to €3 million over and above the €13 million indicative allocation under the Rural Development Programme. These adjustments to both the scheme and the provision were designed to provide further assistance to pig farmers engaging in capital works necessary to comply with the new regulations. The revised scheme provides for a grant of up to 40% of cost, with a maximum investment ceiling of €500,000 for the first house, and of €300,000 for each of up to three more.

 

Forestry Sector   – continued commitment and Government priority

One of the main challenges going into 2013 facing the Minister was the shortfall in capital investment funding. Securing additional capital was critical to meeting concerns within the forest sector in relation to the support for the afforestation programme.  “I am particularly pleased therefore to provide funding of €116 million will allow for a planting programme of approximately 7,000 hectares for 2013 and that premium rates would be maintained at current rates”. This level of support reflects the contribution that forestry makes in economic terms through exports, employment and the provision of wood energy.  The Minister said that the allocation would maintain funding for programmes such as the Forest Roads and Forest Thinning Schemes.

 

Horticulture – maintaining our commitment

Referring to the Horticulture sector, Minister Coveney said “ I am very pleased that support for specialised capital investments had been maintained with €3.25 million allocated to the scheme of investment aid for the development of the commercial horticulture sector for 2013”.  This Scheme represents the main source of State funding for horticultural producers and is seen as vital to improving growers’ competitiveness and the quality of output as well as allowing growers innovate and diversify production. 

 

Tillage Sector - Malting Barley discussion groups to be launched and a new focus with Food Harvest 2020

The Minister announced his intention to launch an industry sponsored Discussion Group initiative for the Malting Barley sector. The recently published Tillage Sector Development Plan will be used as a roadmap for growing the tillage sector and delivery of its goals will be monitored at the Food Harvest 2020 High Level Implementation Committee.

 

Teagasc and Bord Bia

Bord Bia and Teagasc perform critical roles in the agri-food sector. In support of their respective programmes in marketing of Irish food and drink products internationally and in providing education, advice and training programmes to improve productivity on Irish farms, the Minister is providing €29 million in Grant in Aid for Bord Bia and of €112 million for Teagasc. “In addition to providing total funding of €141 million to Bord Bia and Teagasc, I am also providing €11 million to Teagasc to maintain its range of training programmes”. The Minister is also providing some €2.1 million in Exchequer Funding to the Irish Cattle Breeding Federation to assist in its ongoing work in developing a framework for the improvement of breed quality in the beef, dairy and sheep sectors.

 

Schemes - protecting livelihoods of small and low income farmers

 

Disadvantaged Areas Schemes

Underlining his commitment to the protection of income for smaller farmers the Minister announced an increased allocation of €195 million in support of Disadvantaged Area Payments “to reflect my commitment to the protection of farming in disadvantages areas, most particularly to the smaller farmers whose livelihoods are most dependent on this scheme. While the amount available in 2013 will be higher than this year, it still requires an adjustment to keep within the new provision. I have decided to focus on the protection of the smaller and most disadvantaged, including mountain sheep holdings whose payments will remain unchanged next year. In order to make the necessary adjustment, I intend to reduce the maximum area payable from 34 to 30 hectares. This will not be applied to farmers in mountain areas. This adjustment, together with some minor technical changes, will allow me to increase the overall provision in 2013 compared to this year”.  These measures will mean that 72% of farmers will have no change in their income resulting from this change.

 

Environmental Schemes

“Having announced a €20 million AEOS 3 in September, I have provided €61 million in 2013 to fund the three AEOS schemes that are running concurrently .Once again, under AEOS 3  priority will be given to those farmers in designated areas.   Parallel with AEOS, I will continue to fund REPS schemes in the sum of €139 million in 2013”. Because of budgetary limitations a portion of REPS 4 balancing payments will be rescheduled into early 2014.

 

The Marine Sector – building on our potential

The Marine sector is a high priority for me and in 2013, “at a time of great opportunity for the sector I am providing for an increase in funding for harbours in the sum of €8.5 million which will support the building and expansion of sea fisheries harbours for the years ahead. I have also provided some €39 million to fund the activities of BIM and the Marine Institute”. These agencies are part and parcel of the fabric of marine life in Ireland providing the research and development functions of a vibrant seafood sector that is so dependent on export markets and trade. “I am also allocating €11 million to the Sea Fisheries Protection Authority in 2013 in pursuance of its statutory functions. I have also agreed to provide an annual contribution of €250,000 over the coming four years to part fund the new Integrated Maritime Energy Research Centre (IMERC) development in Cork”, a partnership between University College Cork (UCC), Cork Institute of Technology and the Irish Naval Service.  The centre at Ringaskiddy will specialise in marine energy, maritime security and safety, shipping logistics and transport and marine recreation.   

 

Horses and Greyhounds – supporting a world class industry

A total of €55 million in support of the horse and greyhound sectors is provided for 2013 to fund the continued development of these important industries which contribute a combined economic value of €1.4 billion to the economy and some 27,000 jobs. “I am addressing the main recommendations of the recently published Indecon report in order to provide the optimum structure to facilitate the long term success of the thoroughbred horse racing industry”, 

 

Animal Health and Welfare - increased payments to animal welfare organisations

The Minister has provided some €2 million for animal welfare purposes and a further € 1.5 million for the control of horses in 2013. “These important financial commitments are a clear and tangible endorsement of my continued personal commitment to the protection of animals of all species”. Furthermore savings to farmers amounting to €3million will result from the introduction of new arrangements in 2013 for Brucellosis testing resulting in some 500,000 fewer cattle being tested.  “I am also allocating some €500,000 to support of the excellent work being done by Animal Health Ireland in developing programmes aimed at eradicating production type diseases that give rise to very significant financial losses to Irish farmers.” 

 

Research – Acting Smart

In addition to these measures, the Minister is providing strong financial support for research across animal and crop production, sustainability and food processing, traceability, safety and quality, consistent with the Think Green, Act Smart, Achieve Growth principles of Food Harvest 2020. The Vote makes provision in support of these research objectives of some €19 million next year. The Minister said that “research will play a key role in driving innovation within the bio-economy and contribute strongly to the growth targets in Food Harvest 2020 as well as contributing to the Government’s Action Plan for Jobs.  This provision builds on my recent announcement €32 million of grant aid for 55 research projects focusing on sustainable food production, processing and forestry”.

 

Reform Programme – Public Sector Reforms that benefit the citizen 

The Department and its agencies continue to drive reform programmes across all levels.  The cost of running the Department and its agencies has been reduced by over €12 million over a twelve month period and the Department’s staffing level has fallen from 4,800 in 2005 to less than 3,300 currently, a reduction of 31%. This year alone staffing has fallen by almost 200 and the cost of running the Department in 2013 is estimated at €8 million less than 2012. Overall running costs have fallen since 2008 by some €76 million or approximately 25%, €303 million in 2008 to an allocation of €227 million for 2013. The Minister said “driving this reform programme through technology driven solutions has facilitated the achievement of quicker scheme delivery and, as a consequence, payments being made faster than ever”.

 

Conclusion

Minister Coveney concluded by saying that: “the outlook for the agri-food sector remains very bright and the sector will continue to contribute strongly to national economic recovery.  There is a new awareness of the vital economic importance of the sector and a strong recognition that the sector has the fundamental building blocks in place to reach the demanding targets it has set itself in Food Harvest 2020, a blueprint that will contribute hugely to the growth in food and drink exports and to national prosperity. I am confident that the measures introduced in Budget 2013, in a very challenging fiscal environment, will help us to continue on this path towards national recovery”

Date Released: 06 December 2012