The Oireachtas Committee on Social Protection has been told that payments from farm schemes under Pillar II of the Common Agricultural Policy (CAP) should be “disregarded in their totality” from the means assessment for the Farm Assist payment.
The committee held a meeting today (Wednesday, April 17) on the Farm Assist payment, particularly on the issue of low uptake of the payment among farmers.
The committee heard from delegations from four farm organisations, namely the Irish Farmers’ Association (IFA); the Irish Creamery Milk Suppliers’ Association (ICMSA); the Irish Cattle and Sheep Farmers’ Association (ICSA); and the Irish Natura and Hill Farmers’ Association (INHFA).
The Farm Assist is a means tested support for farmers facing financial difficulties.
In her opening remarks, IFA deputy president Alice Doyle said: “For those deemed unviable, struggling to make ends meet amidst fluctuating market conditions, unpredictable weather patterns, and rising input costs, Farm Assist provides essential support that extends far beyond mere financial aid.
“However, participants have reduced significantly in both the Farm Assist and the Rural Social Scheme, which points to the need for change. A full reassessment of the means testing requirement is needed to ensure a fairer approach for people,” Doyle added.
In 2022, a new level of disregard of farm scheme payment was introduced, in which grants of up to €2,450 earned through agri-environmental schemes are disregarded, with the remaining balance assessed at 50%.
However, IFA director of policy and chief economist Tadhg Buckley told the committee today that an argument could be made that all farm schemes – at least those funded through CAP – should see their payments totally disregarded from the Farm Assist assessment.
Buckley cited the principal of ‘cost incurred, income forgone’ – the basis for most CAP payments – as central to that argument.
He told the committee: “The payments that come into Ireland come in two pillars, so you have Pillar I and Pillar II. Pillar II is based on the principal of cost incurred, income forgone. So if you get that payment, it’s either on the basis that you incur a cost to get the payment, or you forgo income.
“At the moment you can deduct expenses under the means assessment, but you can’t account for income forgone. For instance, you may have to reduce the productivity of your land, and you get a return payment, but you can’t factor in the productivity loss as an expense,” Buckley added.
“There’s more than environmental schemes. There’s a lot of other Pillar II schemes as well, and they’re based on that principal of cost incurred, income forgone.”
“So I would argue, and there’s an argument there, that [those scheme payments] should be disregarded in their totality, because of that principal,” the IFA chief economist said.
Buckley also said that a similar issue is at play in Pillar I, with regard to the eco-scheme.
“The eco-scheme is a similar principal. So one of the eco-scheme measures is space for nature. Obviously if you have higher space for nature that’s a positive thing, but your productivity on the farm is reduced then,” he said.
“It’s a good thing to have a higher space for nature, but you can’t deduct that expense, and that’s a Pillar I payment,” he added.
“It’s an argument, that that principal should certainly be used from your [committee members] perspective to say: ‘How do we justify a full disregard?’ Well, there it is, it’s an EU principal.”
Buckley also drew attention to the low level of uptake of Farm Assist, pointing out the discrepancy between farmers who may be entitled to it versus those who actually avail of it.
“There’s 75,000 sucker farmers in Ireland – a good share of them are part time, they have other income – but their average income for the last three years was €9,200,” he said.
“So there is clearly a lot of farmers that are certainly entitled to at least apply, and they’re not. The figures are stark when just picking out the suckler farmers, and there are other low-income sectors as well,” he added.
“When you look at the numbers of farmers that are at the low-income level, versus the participants, there’s clearly something amiss.”
IFA deputy president Doyle highlighted another bar to uptake, namely the lack of advice available on Farm Assist compared to other social welfare payments.
“Most people, when they go looking for social welfare, they go from being employed to unemployed, and they usually have bodies that advise them very carefully as to what their social welfare entitlements are,” she said.
“In farming it’s a different setup. It’s when you fall on hard times for whatever reason, and because of that there isn’t always somebody to advise you on what is available to you,” Doyle added.
Meanwhile, INHFA vice president John Joe Fitzgerald told the committee that some farmers are apprehensive about the process of assessment itself.
“A lot of farmers have a fear of the inspector, and even the assessment. There is a bit of fear there, and that’s why a lot of them don’t apply for it,” Fitzgerald said.
The Oireachtas Committee on Social Protection is chaired by Roscommon-Galway independent TD Denis Naughton. He highlighted a social and cultural aspect to the lack of uptake of Farm Assist among farmers.
“The Farm Assist was originally the Farmers’ Dole, so there is a social and cultural aspect to this. People are reluctant to apply, and it’s only when their back is to the wall that they actually consider it, because it’s seen as throwing in the towel in terms of a viable farm enterprise.