The Ulster Farmers’ Union (UFU) has proposed measures it says will help dairy farmers deal with cash flow issues.
UFU President Ian Marshall, UFU Dairy Policy Committee Chairman Jonathan Moore, and Dairy Policy Committee Vice Chairman William Irvine tabled the proposals a meeting with the Northern Ireland Agriculture Minister Michelle O’Neill. which was organised to discuss the current milk market situation and how it is affecting Northern Ireland dairy farmers.
“This meeting was an opportunity for us to highlight the current cash flow issues facing not only dairy farmers but also farmers in many other sectors in Northern Ireland, and to discuss what can be done to help alleviate some of the current financial pressure.
“In terms of dairy farmers, while we have continued to press for the introduction of usual EU market support measures, such as an intervention at a more realistic price level, it is unfortunately all too clear that the European Commission are reluctant to do so. We therefore discussed a range of more local initiatives with the DARD Minister, which could be utilised by farmers across all sectors, such as ‘capital holidays’ for structured loan repayments.
“Another option discussed was for increased awareness of the existing accounting practice known as ‘profit averaging’, where presently profits for two consecutive years are added together and divided by two but also extending this from the presently permitted two to a five-year period as was done in the recent budget in the Republic of Ireland.”
He said the introduction of a Farm Management Deposit Scheme (FMD) was also discussed, similar to the one currently operating in Australia, where price volatility is also an issue, to assist primary producers in dealing effectively with fluctuations in their farm business cash flows. “This would be a new scheme for the UK, allowing eligible primary producers to set aside pre-tax income in years of high income in a designated bank account from which they could draw down in years of low income and the tax becomes payable at that point.”