A massive rise in construction costs is “wiping out” farmer grants under the Targeted Agricultural Modernisation Scheme (TAMS), according to the Irish Creamery Milk Suppliers Association (ICMSA).

Commenting on the 100% approval of farmers under TAMS Tranche 21, the chairperson of ICMSA Farm and Rural Affairs Committee Denis Drennan welcomed the fact that the budget was sufficient to approve all applicants on this occasion.

However, Drennan stressed that the reference costs used to determine a farmers’ grant “must be updated immediately to reflect the very substantial increase in construction costs”, adding:

“Obviously we’ve been speaking to farmers across the country and, across every county, construction costs have increased by unprecedented levels in the last year.

“The result is that a farmer expecting a 40% grant will end up getting a substantially reduced grant rate as a result of increased construction costs and the failure of the department to update reference costs.

“The minister [Minister for Agriculture, Food and the Marine Charlie McConalogue] is going to have to revised the reference costs immediately.

“In the interests of fairness, we think that the revised reference costs should apply to all investments under TAMS completed in 2021,” Drennan said.

The chairperson said that the construction increases are of double-digit size and were putting “unexpected and insurmountable financial strains” on farmers trying to complete investments.

“If we’re going to grant-aid the construction then the grants must be based on a current and realistic costs,” Drennan concluded.