Next week’s budget is an opportunity for the Minister for Agriculture to demonstrate he has farmers' backs in what has been a difficult year, especially for beef farmers and, to only a slightly lesser extent, sheep farmers.
It is now a year and a half since the Irish Farmers Journal launched the save our sucklers campaign with the IFA as the only means of making our specialised beef supply chain viable for farmers involved.
In the budget last year, the minister made a token contribution to the sector with the Beef Environmental Efficiency Pilot (BEEP) scheme, where farmers are paid €40 for weighing calves.
While the money paid to farmers in this scheme is small, it does establish a platform on which the minister could build and farmers would be open to co-operation in the suckler sector if he could find the money to move closer to the €200 per cow that is required.
Time to end levies
Levies paid by farmers to Bord Bia have been around since the organisation was set up in 1994 and are paid per head at a rate of €1.90 for cattle, 25c for sheep and 35c for pigs.
Meat promotion agencies in the North and Britain also collect statutory levies, going back to their establishment in the 1960s.
In an era before the modern multinational meat processing companies dominated the industry, cattle, sheep and pigs were slaughtered in a multitude of small abattoirs and huge numbers were exported live to Britain.
There is much speculation around what the Government might do by way of a carbon tax, but it is likely that petrol and diesel will be taxed more
In the early years of the meat processing industry developing, greatly assisted by the roll-on roll-off ferries for refrigerated containers, Ireland could seriously think about exporting chilled beef carcases as opposed to live cattle.
In this era, a national meat promotion agency was central to developing markets through international offices which linked still relatively small meat processors with international customers.
Evolution
With huge meat companies that have their own specialist marketing teams Bord Bia’s role in marketing has evolved into promotion of Irish values and Quality Assurance and is governed by state aid rules.
For this reason alone, the minister should call time on farmers having to pay a levy every time they take cattle, sheep or pigs to their local factory.
That is not to dismiss the importance of the work Bord Bia do, rather it is a case that the minister should pick up the entire tab for the operation of Bord Bia.
Government is already the main funders, with just €5.9m of the €72.2m of revenue in 2017 coming from farmer levies.
By absorbing this modest cost in the budget next week, the minister could make a small gesture towards farmers.
The one downside of replacing farmer levies with direct government funding is that levies can be used as the producer matched funding, in advertising and promotion campaigns that require 50:50 industry funding under EU State Aid Approval for advertising activities. To offset this would require a government contribution that is double the farmer levy.
Carbon tax
There is much speculation around what the Government might do by way of a carbon tax, but it is likely that petrol and diesel will be taxed more.
Of course, transport and buildings are bigger causes of greenhouse gas emissions in Ireland than agriculture and it is right that this is acknowledged.
However, farmers are much more dependent on motor vehicles than urban dwellers, because they don’t have the option of using public transport as they run their farm.
Similarly, using electric vehicles just isn’t practical in rural areas because of scarcity of charging points.
Therefore, farmers need to be exempted from any increase on fuel duty in vehicles that are required for operation of their farm businesses.
Brexit
Preparation for Brexit is dominating plans for this budget and as farmers, particularly in the beef sector, are the most exposed, it is essential that the minister has a substantial fund ring-fenced to compensate farmers in the event of a no-deal Brexit.
The BEAM scheme is jointly funded by the EU and the Irish Government and it is likely that matched funding will be needed for future applications given the market situation in the beef sector.
It isn’t all about asking
In case this reads like a list of demands without anything in return, farm organisations have to keep highlighting that Irish farmers produce the raw material that keep the factories running and sustain what is a profitable business for everyone except the supplier of the raw material.
The revenue generated for Government through taxation of employees and companies means that prioritising investment in farming in next week’s budget is a win for both Government and farmers.
Read more
Johnson's Brexit proposals are of little use to farmers
Green measures sought by farm groups in Budget 2020
Meat and dairy industries seeking €225m Brexit fund
Next week’s budget is an opportunity for the Minister for Agriculture to demonstrate he has farmers' backs in what has been a difficult year, especially for beef farmers and, to only a slightly lesser extent, sheep farmers.
It is now a year and a half since the Irish Farmers Journal launched the save our sucklers campaign with the IFA as the only means of making our specialised beef supply chain viable for farmers involved.
In the budget last year, the minister made a token contribution to the sector with the Beef Environmental Efficiency Pilot (BEEP) scheme, where farmers are paid €40 for weighing calves.
While the money paid to farmers in this scheme is small, it does establish a platform on which the minister could build and farmers would be open to co-operation in the suckler sector if he could find the money to move closer to the €200 per cow that is required.
Time to end levies
Levies paid by farmers to Bord Bia have been around since the organisation was set up in 1994 and are paid per head at a rate of €1.90 for cattle, 25c for sheep and 35c for pigs.
Meat promotion agencies in the North and Britain also collect statutory levies, going back to their establishment in the 1960s.
In an era before the modern multinational meat processing companies dominated the industry, cattle, sheep and pigs were slaughtered in a multitude of small abattoirs and huge numbers were exported live to Britain.
There is much speculation around what the Government might do by way of a carbon tax, but it is likely that petrol and diesel will be taxed more
In the early years of the meat processing industry developing, greatly assisted by the roll-on roll-off ferries for refrigerated containers, Ireland could seriously think about exporting chilled beef carcases as opposed to live cattle.
In this era, a national meat promotion agency was central to developing markets through international offices which linked still relatively small meat processors with international customers.
Evolution
With huge meat companies that have their own specialist marketing teams Bord Bia’s role in marketing has evolved into promotion of Irish values and Quality Assurance and is governed by state aid rules.
For this reason alone, the minister should call time on farmers having to pay a levy every time they take cattle, sheep or pigs to their local factory.
That is not to dismiss the importance of the work Bord Bia do, rather it is a case that the minister should pick up the entire tab for the operation of Bord Bia.
Government is already the main funders, with just €5.9m of the €72.2m of revenue in 2017 coming from farmer levies.
By absorbing this modest cost in the budget next week, the minister could make a small gesture towards farmers.
The one downside of replacing farmer levies with direct government funding is that levies can be used as the producer matched funding, in advertising and promotion campaigns that require 50:50 industry funding under EU State Aid Approval for advertising activities. To offset this would require a government contribution that is double the farmer levy.
Carbon tax
There is much speculation around what the Government might do by way of a carbon tax, but it is likely that petrol and diesel will be taxed more.
Of course, transport and buildings are bigger causes of greenhouse gas emissions in Ireland than agriculture and it is right that this is acknowledged.
However, farmers are much more dependent on motor vehicles than urban dwellers, because they don’t have the option of using public transport as they run their farm.
Similarly, using electric vehicles just isn’t practical in rural areas because of scarcity of charging points.
Therefore, farmers need to be exempted from any increase on fuel duty in vehicles that are required for operation of their farm businesses.
Brexit
Preparation for Brexit is dominating plans for this budget and as farmers, particularly in the beef sector, are the most exposed, it is essential that the minister has a substantial fund ring-fenced to compensate farmers in the event of a no-deal Brexit.
The BEAM scheme is jointly funded by the EU and the Irish Government and it is likely that matched funding will be needed for future applications given the market situation in the beef sector.
It isn’t all about asking
In case this reads like a list of demands without anything in return, farm organisations have to keep highlighting that Irish farmers produce the raw material that keep the factories running and sustain what is a profitable business for everyone except the supplier of the raw material.
The revenue generated for Government through taxation of employees and companies means that prioritising investment in farming in next week’s budget is a win for both Government and farmers.
Read more
Johnson's Brexit proposals are of little use to farmers
Green measures sought by farm groups in Budget 2020
Meat and dairy industries seeking €225m Brexit fund
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