Dáil Éireann - Volume 458 - 16 November, 1995

Written Answers. - Farm Incomes.

18. Kathleen Lynch asked the Minister for Agriculture, Food and Forestry if his attention has been drawn to the recent Teagasc report indicating that half of farmers are living in poverty; his views on whether the net effect of the common agricultural policy has been to preserve and in some cases widen the gap between poorer and better-off farmers; and if he will make a statement on the matter. [16985/95]

Minister for Agriculture, Food and Forestry (Mr. Yates): The national farm survey, published by Teagasc, measures changes in on-farm income and does not attempt to measure the total household income of farming families, approximately 50 per cent of which is derived from off farm activities. Therefore, while the survey is a very useful indicator of income from farming, it cannot be used to make inferences on poverty levels within the farming community.

I note that the Teagasc survey records an impressive 12 per cent increase in average on-farm income in 1994 — the third successive year of growth in farm income. I am very aware that this average figure includes farmers with high incomes and those in disadvantaged areas with less viable enterprises. I would point out however that on-farm income relativity between disadvantaged areas — where the bulk of low income farm families are situated — and the national average had improved over the period that the CAP has applied in this country. Prior to joining the EU in the mid-1960s, average family farm income in the North and west was 49 per cent of the national average while in recent years average family farm [790] income in the less favoured areas has increased to about two thirds of the national average. I also note that the Teagasc survey shows that direct payments, and particularly CAP reform compensatory payments, had a significant impact on incomes in the traditionally low-return farming systems such as cattle and sheep.

I am, however, very conscious that some farm households still have low incomes in absolute terms. According to the CSO's household budget survey about 23 per cent of farm families had gross household incomes under £5,000 per annum in 1987, the last year for which this data is currently available. Under the Operational Programme for Agriculture, Rural Development and Forestry it is intended that such low income households will benefit from a variety of measures aimed at improving production efficiency, dealing with problems in farm structures, promoting broad rural development and, where necessary, providing direct income support.

The following are some recent initiatives in this regard. The reclassification of almost 1 million acres of farmland from less severely handicapped to more severely handicapped will benefit an additional 10,000 farmers through increased headage payments. The subsidised milk quota restructuring scheme, which is available again in 1995, provides a subsidy for small scale milk producers towards the purchase price of additional quota. I have also recently made provision for the ring fencing of quota within disadvantaged areas which will prevent loss of milk quota from the less favoured areas.

The fight against poverty, both urban and rural, is a priority for this Government, and the Deputy can be assured that this will continue to be fully reflected in our policies on agriculture and rural development.