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Coveney Announces Increased Budget Expenditure of €1.251 Billion in 2015

  •  Funding Increased for First Time Since 2009
  •  New Agri Taxation Measures Introduced
  •  Beef Genomics Scheme - €100 Each for First Ten Animals

 

The Minister for Agriculture, Food and the Marine Simon Coveney TD today announced details of his Department’s 2015 budget. Emphasising that despite the fragile recovery in the economy, he had secured an increase in funding for the first time since 2009. This would enable him to commence the key actions that will underpin the new Rural Development and Seafood Development programmes that he had secured as part of the reform of the Common Agriculture Policy and Common Fisheries Policy negotiations which he successfully completed during Ireland’s Presidency in 2013.

“In this budget I wanted to set out clear priorities in order to maximise the contribution that the agri-food and marine sectors can contribute to national economic recovery and to focus as well on areas that are currently facing challenges” said the Minister.  “I have again this year given particular priority to the beef sector by increasing in a very substantial manner the funding allocated to the new Beef Data and Genomics Scheme by raising it from €23 million in 2014 to €52 million”.

 “To underpin my commitment to the beef sector I have increased the payment to €100 per head for the first 10 animals in a participating herd. This amounts to an increase from €60 to €100 per animal for the first ten animals in a herd and from €60 to €80 for all other animals. This level of support is a very welcome boost to the beef sector at a time when it is most needed”.

Funding for 2015

The Vote of the Department in 2015 will amount to €1,251 million, comprising €1,036 million in current expenditure and €215 million in capital expenditure. This is an increase overall of €32 million compared to the 2014 budget. In addition, I will also be providing off Vote for payments amounting to €1,215 million towards the single farm payment in 2015, giving total funding for the year of €2,460 million.

In this first post recovery budget, this is a very strong outcome and will enable the Minister to address the key priority areas identified as needing support in the new Rural Development Programme and the Seafood Development Programme in 2015. “I have provided the sum of €439 million for RDP measures in 2015, an increase from €405 million in 2014. In addition, I have provided €144 million to fund the resourcing of Teagasc and Bord Bia. Some €76 million has been allocated to cover Marine activities including the seafood development programme, fisheries harbour developments and the resourcing of Bord Iascaigh Mhara, the Marine Institute and the Sea Fisheries Protection Authority”

Key priorities

The Government has prioritised agriculture and food as a major economic driver for the Irish economy. The Programme for Government set out a strategy for growing the agri-food sector and much has been achieved. The sector continued to perform strongly throughout the economic downturn, outperforming other sectors in terms of export growth and it has made a significant contribution to the overall economic recovery already underway. Food and drinks exports reached an all-time high of some €10 billion in 2013, a 40% increase in value terms since 2009. However, there are challenges ahead and the measures announced as part of Budget 2015 form part of the policy response to those challenges.

“My overarching priority for 2015 is to deliver the first part of the Government’s commitments to the farming and fishing sectors in the commencement of actions under the new rural development and seafood development programmes. These supports will prioritise vulnerable sectors and support the incomes of family farms, particularly those areas of natural constraints to which I have allocated €195 million in 2015. I also want to put in place investment programmes that deliver improved structures at farm level to enable the sector to increase capacity, improve profitability and deliver on the targets of Food Harvest 2020 and beyond. These objectives will be met by the combination of direct grant provisions as well as a suite of taxation measures that will support modernisation, restructuring and promote growth and expansion”.

“I am also prioritising innovation, as part of a the smart agenda through a substantial fund for R&D and Training amounting to €28 million under the FIRM, Stimulus and Forestry funds and Teagasc training courses. I will also be maintaining and enhancing our focus on food safety and animal health and welfare with a provision of some €82 million overall, meeting standards that are essential to maintaining and further enhancing Ireland’s international reputation for the quality of its products”.

“Conscious of the loss of life and injuries sustained on farms in recent years, particularly this year, I have also prioritised farm safety measures in this budget to which I have allocated some €12 million in 2015”. 

Measures

Beef:  € 74 Million

A total package of €74 million is being provided for the beef sector in 2015. Last year’s budget introduced a new Beef Genomics Scheme and this is now being further developed and enhanced to deliver a payment per animal of €100 for the first ten animals, with the remaining animals being eligible for an €80 payment per animal in participating herds, once approved as part of the new RDP. This will cost some €52 million in 2015.

An additional sum of €9 million is available to fund the Beef Data Programme and a further €6 million has been allocated in 2015 to assist farmer participation in the Beef Quality Assurance Scheme. In addition eligible farmers may also participate in the Beef Efficiency Programme for which some €1 million is provided. A further €1 million has been allocated to An Bord Bia in support of its marketing of Irish products abroad, beef in particular.

ICBF is being allocated €1.6 million towards its cattle improvement programme. Continuing support for investments in marketing and processing is provided within the €4million available for this purpose in 2015.

 

Farm Safety Scheme:  € 12 Million

Funding of €12 million is allocated to a new once-off Farm Safety Scheme. The scheme, subject to EU approval, will shortly be open for applications, with a grant rate of 40% up to a maximum eligible investment ceiling of €20,000. The Minister was particularly anxious to acknowledge the very high level of risk on farms and this targeted scheme is aimed at providing a once-off opportunity to farmers to upgrade safety arrangements on their farms.

 

Agri-Environment:  € 150 Million

A totalfund of €150 million has been allocated in 2015 to agri-environment schemes with funding dominated by REPS and AEOS, together amounting to some €122 million. The key budget provision for 2015 is the allocation to GLAS (Green Low Carbon Agri-Environment Scheme), which is designed to build on the success of REPS and AEOS to encourage farmers to farm in an environmentally friendly manner. GLAS will be a five year scheme with a maximum payment of €5,000 per annum, with the potential to qualify for a top-up payment of up to €2000. The scheme will eventually facilitate the entry of 50,000 farmers. Funding in 2015 provides for the opening of the scheme to some 30,000 entrants. This scheme, when fully open, will require funding of €150 million and will represent a significant scaling up in funding in 2016 (with 50,000 farmers this will be up to € 250 million).

 

Milk:  € 20 Million

There will be a particular focus on milk in 2015 with the ending of the milk quota regime. It is clear that farmers are already gearing up for expansion. Investment in on-farm facilities will be a key part of leveraging the growth potential of the Irish dairy industry. In the capital programme the Minister has doubled the allocation in support of the Targeted Agriculture Modernisation Scheme (TAMS) from €17 million to €34 million, for which dairy expansion will be the most substantial area for investment.

 

Marine:  € 76 Million

Included in the funding of the Marine sector is the sum of €11.5 million devoted to the new seafood development programme 2015, while a further €11.5 million of capital funding will be invested in fishery harbour capital works, which not only adds value and improvement to these harbours but also contributes heavily to the local economies of the areas concerned. Some €6.3 million is allocated to investments in aquaculture and fish processing projects, while close to €47million is allocated to fund the marketing and development functions of BIM, the research role of the Marine Institute and the regulatory and control functions of the Seafood Protection Authority. 

   

Horse and Greyhound Fund€ 68 Million

The Minister has allocated at least €68 million to the Horse and Greyhound Fund, an increase of €14 million in 2015, in recognition of the significant shortfall in funding going into the horse and greyhound sectors in recent years as a result of the downturn in the economy. With the introduction of the online betting tax, the Government will be providing an additional €6 million a year to the Horse and Greyhound Fund. As a result Horse Racing Ireland will be better positioned to make a significant contribution to racecourse reinvestment in 2015, with an initial allocation of €11.2 million. The remaining €2.8 million will be allocated to Bord Na gCon to support its activities.

 

Sport Horse:  € 0.6 Million

As part of the new ten year development plan for the sport horse sector the Minister is providing €600,000 in support of the promotion and marketing activities of Horse Sport Ireland.

 

Sheep:  € 19 Million

In continuing support of the sheep sector €4 million has been allocated to the Sheep Technology Adoption Programme, while TAMS will provide further support towards assisting investments in sheep handling facilities. In addition, the sheep grassland scheme amounting to €15 million will be incorporated into individual farmer single payment entitlements in 2015.

 

Horticulture:  € 7.2 Million

A provision of some €4.2 million has been provided to fund capital investments in the Horticulture sector as well as €3 million funding toward the Food and Horticulture Promotion Fund.

 

Forestry:  € 110 Million

The Forestry sector receives the largest share of the public capital programme expenditure of the Department and the Minister has again provided some €110 million for this purpose in 2015. This level of funding will allow for an afforestation programme of 7,000 hectares in 2015 and some 120 kilometres of forest roads.

 

Animal Welfare:  € 5 Million

Following the animal welfare conference earlier this year the Minister met with representatives of the traveller community and, as a result has allocated an extra €1million to support the development of new facilities to provide shelter for the urban horse population and to encourage young people in the care and welfare of horses. This fund will target establishing shelters, in association with Local Authorities, in a number of locations in 2015. Further allocations will be provided for new centres in future years. This funding is additional to the €1.8 million being allocated to the control of horses scheme and the €2.1 million allocated to support voluntary organisations in their animal welfare work.

 

CEDRA Report:  € 1 Million

An allocation of €1 million has been made towards the establishment of a Rural Innovation and Development Fund to support innovative and small scale pilot initiatives under the CEDRA report.

 

Pigs and Poultry:

Funding towards investments in upgrading existing buildings will be provided in the new TAMS scheme.

 

Agri-taxation

The Minister together with the Minister for Finance published the Agri-taxation review which was announced in last year’s budget. This Review was timely and has provided a unique opportunity to examine a critical element of Government support to the agriculture sector in the context of the Food Harvest 2020 strategy and the major opportunity presented by the abolition of dairy quotas next year.

The key taxation measures in this budget are aimed at increasing land mobility through increasing the income thresholds for relief from leasing income by 50% and through the introduction of a fourth threshold for lease periods of 15 or more years. In addition, the lower age threshold of 40 years of age for eligibility has been removed.

Assisting succession and the transfer of farms has been a central part of the Government’s agri-taxation policy and Budget 2015 includes a number of measures to maintain and strengthen that support, specifically the retention of Agricultural Relief from Capital Acquisitions Tax, Retirement Relief from Capital Gains Tax, the current stamp duty exemptions on transfers of land and other new measures including a targeting of Agricultural Relief from Capital Acquisitions Tax to qualified or full-time farmers or to those who lease land out on a long-term basis, extension of the eligible letting period under the retirement relief of a qualifying asset to 25 years.

Other tax concessions agreed as part of the budget include enhancing the Income Averaging measure by increasing the period from 3 to 5 years and allowing averaging to be availed of where a farmer and/or their spouse receive income from an on-farm diversification trade or profession. In all, there are 12 new measures introduced in Budget 2015 and full details are attached.

 

Conclusion

In conclusion, Minister Coveney said: “I set out over recent years to target particular areas of the agri-food budget that could best leverage the maximum benefit for the sector and the economy despite limited financial resources available to me. Since 2011 the contribution to the economy of the agri-food sector has grown exponentially, hitting and exceeding its targets for growth in Food Harvest 2020. Having negotiated a new CAP and CFP last year in Brussels I am now on the verge of implementing actions under the new rural development and seafood development programmes that will leave a lasting legacy on these sectors and make a huge contribution to the further development of these important pillars of the Irish economy”.

 

NOTE FOR EDITORS 

Main details of Spending

  • €439m for the Rural Development Programme
  • €76.2 million for Fisheries including EFF, new EMFF, fishery harbours and marine related NCSSBs
  • €195 million for Areas of Natural Constraint
  • €150.5 million for Agri-environmental schemes (REPS/AEOS/GLAS)
  • €110 million public capital for Forestry
  • €73.8 million for the Beef sector
  • €28 million for Research & Training
  • €81.5 million for Food Safety, Animal and Plant Health including €35 million for TB & Brucellosis eradication
  • €34 million for Targeted Agriculture Measures (TAMS)
     
  • €4 million for Sheep Technology Adoption Programme.
  • €68 million in support of the Horse (€54.4m) and Greyhound (€13.6m) racing industries
  • €4.9 million for Animal Welfare
  • €200 million for Non-Commercial State Sponsored Bodies under the Department’s aegis.
  • €1m for CEDRA related initiatives

Food Harvest 2020 is the strategy for the medium-term development of the agri-food (including drinks) fisheries and forestry sector for the period to 2020. The strategy outlines the key actions needed to ensure that the sector contributes to the maximum possible extent to our export-led economic recovery and the full development of the smart economy.

 

To view this press release as a PDF - please click here:  DAFMPR 147/2014 (pdf 722Kb) 

Date Released: 14 October 2014