Dáil Éireann - Volume 582 - 24 March, 2004
Other Questions. - Farm Retirement Scheme.
Mr. Sargent Mr. Sargent
7. Mr. Sargent asked the Minister for Agriculture and Food if he intends to compensate persons in the early retirement scheme who lose their quotas from the reform of the Common Agricultural Policy; and if the value of suckler and sheep quotas of farmers in the early retirement scheme can be converted into entitlements or special payment entitlements. [9193/04]
Mr. Walsh Mr. Walsh
Mr. Walsh: My Department is involved in working groups and in continuing discussions with the European Commission on the detailed rules for implementing the mid-term review agreement. I have already raised a number of issues relating to farmers who have retired under the early retirement schemes and the implications for them of decoupling and the single payment scheme.
Under the European Council regulation introducing the single payment scheme, a farmer may have access to the scheme if he or she was an active farmer during the reference years 2000, 2001 and 2002 and received payments under the livestock premia and-or arable aid schemes. In addition, farmers for whom entitlements will be established must activate those entitlements in 2005 by continuing to farm and submitting an area aid declaration in that year. In general, farmers must also have an eligible hectare of land for each payment entitlement.
Farmers who were participating in the early retirement scheme before the commencement of  the reference period will not have entitlements established for them under the single payment scheme. This is because they had already retired from farming and their obligations under the early retirement scheme preclude them from returning to farming in future. The people who were leasing these retired farmers’ lands and were active farmers in the reference period will have entitlements established for them. It should be noted that entitlements are attached to the farmer who was actively farming during the reference period and not to the land. However, during the Council negotiations last year, I secured agreement that farmers, including offspring of farmers who retired before the reference period who take over the holding of the retired farmers at some date in the future, will be able to apply to the national reserve for payment entitlements under the single payment scheme.
Mr. Sargent Mr. Sargent
Mr. Sargent: Does the Minister feel that a significant cohort of the farming community has been omitted from his reply? We are discussing the issue of widows and widowers in Private Members’ time but I am thinking particularly of those people who want to pass on a livelihood in farming to their children. Like many others, I have correspondence from throughout the country on this matter. These people find that, in spite of professional advice that they should enter into the early retirement scheme and lease land with quotas attached for ten years, the rug is effectively being pulled from under their feet. Is it not important to take into account that, in good faith, the Department, the EU and professional advisers suggested that people take this road but they are now being told they will lose out? Is there not a case for some level of payment or compensation to be made to those who are effectively now in a hardship situation? They were dependent on that early retirement entitlement which now seems to have evaporated. Does the Minister intend to have discussions with those affected in this manner?
Mr. Walsh Mr. Walsh
Mr. Walsh: Retirement scheme means retirement. If, for instance, Deputy Sargent retired from the Dáil at some stage, he would not go back to the person who took his seat to say he wanted it back. The European Commission regards retirement as retirement and a condition of the scheme is that farmers must not return to farming. For farmers who retired prior to the reference years of 2000, 2001 and 2002, we are negotiating with Brussels to have it taken into account if their offspring or a member of their family wish to run the farm. We will have the detailed legal text on the outcome of the negotiations by the end of this month. It has been promised for 31 March. I hope we make progress on the matter and that it will be taken into account that, despite the retirement of a farmer or a farmer’s spouse, it has always been the intention that members of the farmer’s family  would continue working the family farm. We will seek to make provisions for those people.
Farmers who entered the early retirement scheme during or after the reference period will have entitlements established for them provided they were actively farming during the reference period, or some part of it, and received payment under the relevant schemes. As these farmers undertook to give up farming definitively when they joined the early retirement scheme, they will not be in a position to obtain payment under the single payment scheme. The European Council regulation provides for such entitlements to revert to the national reserve. However, the question of whether retired farmers in this category should be allowed to activate entitlements — not for their own use but with a view to leasing them out in 2005 and thereafter — is one of the items still under discussion in the context of the Commission detailed rules. Agreement on the detailed rules is expected by the end of this month. I cannot speculate on them but we have made a strong case for taking account of farmers and farm families in the category raised by the Deputy.
Mr. Timmins Mr. Timmins
Mr. Timmins: Does the Minister agree that he was not comparing like with like when he spoke about Deputy Sargent retiring from his Dáil seat? Would it not be more appropriate to compare it with the concept of someone leasing a business from someone who holds on to the lease but then moves to a different premises taking the business with him and then, after a period, returns the original business to the original owner leaving the owner with just the shell of a business without any of its benefits? I hope I have not tongue-tied the Minister on this.
It is widely acknowledged that a large group of people will lose out under the present proposals. The Minister informed me previously that approximately 10,000 people are on the early retirement scheme. No matter how we look at the issue, their lands as an asset have depreciated rapidly and radically due to a practice into which they entered without any indication that the practice would cost them at a later stage. We must have sympathy for these people but must also do something for them. Whether by design or coincidence, many of these people are in the Cork area and we have been inundated with letters from them. Will the Minister try to find some mechanism to ensure something is done for them? Will he also indicate whether someone on the farm retirement scheme who actively farmed during one of the reference years can avail fully of the single payment scheme?
Dr. Upton Dr. Upton
Dr. Upton: I wish to raise the same point. Many of these people retired in good faith. At the time, they were given what they took to be reasonable professional advice but they had no understanding that, down the line, all their rights would be effectively eroded. To compound matters for them, their pensions are not index- linked. This matter has been raised in committee several times. Will the Minister comment on the matter and will he address the issue at European level on behalf of these people?
Mr. Sargent Mr. Sargent
Mr. Sargent: The Minister said that he is seeking to make provision for farm families. Will he inform the House of the timeframe for when he expects an outcome on the matter? Is he in a position to put forward amendments to the regulations prohibiting farmers in the early retirement scheme from receiving full forestry premium? There is no doubt that work on a pension relating to forestry premiums is also being done. It would be worthwhile from the environmental, human and social point of view to examine this issue so that it does not suffer on the same fronts.
Mr. Walsh Mr. Walsh
Mr. Walsh: I have the greatest sympathy for retired farmers. The farm retirement scheme was introduced to transfer farming practice on a farm from the older to the younger generation. At 55 years of age, farmers can avail of the farm retirement pension. The idea is that a younger person, ideally a green certificate holder under 35 years of age, will take up the farming practice. It is a condition of the scheme that retiring farmers cease farming and do not return to it. Nonetheless, we are trying to assist some farmers in the category in the detailed rules. I have been promised by the European Commission that we will have the detailed rules by 31 March.
We will seek to implement the detailed rules by the end of this year because the new decoupled single farm payment system comes into effect from 1 January 2005. We have already established an appeal system for force majeure cases. We must also establish up to 3% of entitlements as a reserve. I will seek the maximum reserve to help the people about whom we are concerned, some of them retired farmers and some of whom were retired for one or two years of the reference period, in other words, those who retired in 2001 or 2002. Many existing farmers will not be happy about giving up 3% of their entitlement to create a reserve for less well-off people. We will have an interesting discussion from next April about how to best implement the rules to ensure as little hardship and as much fairness as possible is brought into play.
Dáil Éireann 582 Other Questions. Farm Retirement Scheme.