Farm organisations have reacted to this afternoon’s Budget 2023 announcement.
Firstly, the IFA has stated that Budget 2023 will help farmers but will “not keep pace” with input price challenges.
It contains some targeted measures that the organisation had looked for to address the challenges facing the sector.
Cullinan acknowledged the rollover of the fodder scheme and tillage schemes.
He said that the renewal of the Beef Environment and Efficiency Scheme for sucklers (BEEP-S) was “important”.
However, the allocation was “too low”, and it would leave support for suckler farmers “well below” what was needed.
“The fodder, tillage and suckler schemes will not be enough to mitigate the 40% increase in farm inputs, particularly for the low-income beef and sheep sectors,” he commented.
The farm leader acknowledged the introduction of an energy scheme to support farmers who will be facing “very” significant bills over the winter months.
The IFA president said BAR funding of €238m for the farming sector could be “significant”, but we need to see the proposed breakdown of the funds.
Cullinan recognised the liming and multi-species swards schemes and the accelerated capital allowances for slurry storage.
“While these schemes are worthwhile, they fall a long way short of what will be needed to help farmers meet their climate targets,” he said.
The 10% concrete levy will “undermine” these initiatives and means that TAMS costings will have to be revised, he argued.
IFA farm business chair, Rose Mary McDonagh, welcomed the extension of the various agricultural reliefs but expressed concern about the minister’s comments about the Zoned Residential Land Tax.
“There is increasing concern about how this tax will impact farmers. Farmland should be excluded from the scope of the tax,” she said.
McDonagh said the reduction in the flat rate VAT refund to 5% was a “significant” adjustment that would impact farmers by €46m.
Regarding ACRES, its rural development chair, Michael Biggins, said he would be “concerned” that the funding will not allow all potential applicants into the scheme.
He explained that the government have been “trumpeting” this new ‘flagship’ ACRES environment scheme.
However, the reality is that not every farmer, who is currently in an environment scheme, can be included in the new scheme based on the allocation the government made today, he highlighted.
Meanwhile, in the ICMSA’s view, the government had made a “reasonable effort” to respond across a whole range of issues, and that must be acknowledged.
However, its president, Pat McCormack, argued that questions remained around whether the government fully grasped the size of the contribution that agriculture was making to the national economy and the scale of the challenge that had to be met in managing the transition to lower emissions while preserving that “indispensable” positive economic effect.
“It’s notable, for instance, that DAFM is budgeted to receive the smallest increase in expenditure apart from the Department of Taoiseach.”
“We would have to hope that that is not indicative of the sense of priorities. This is a concern, and the reality is that little has been given to support the climate change transition.”
He stated the accelerated capital allowances for slurry storage were a “notable step forward and made sense” on financial and environmental grounds.
Energy support and reliefs
However, he revealed that the 10% on concrete and concrete products due to come into effect from April 3rd, 2023, would “certainly dilute the effectiveness of the measure”.
McCormack was also positive about the extension and rollover of an array of reliefs such as Young Farmer & Farm Consolidation, Stock Relief for Young Farmers and the Excise Relief on green diesel.
However, the latter, he added, needs to be extended well past February 28th, 2023.
He added that the general widening of bands and increase in tax credit would also help farmers in dealing with the overall consumer inflation that was affecting them like every other sector of society.
McCormack said that the inclusion of farmers in the energy support measures was welcome but “no more than an honest recognition of the fact that particularly dairy farmers are such heavy consumers of energy and the dairy sector that those farmers have built is the main engine of most parts of our rural economy”.
“Farmers have to have help on the cost of energy because their milk production is actually the economic energy for whole swathes of rural Ireland”, he concluded.
Meanwhile, Macra na Feirme has welcomed the government’s commitment to the extension of various young farmer tax reliefs to assist in addressing generational renewal and the challenges of food production and climate change.
Its national president, John Keane, said the consistency and continuity of young farmer tax reliefs is “essential” to support generational renewal.
The rural youth organisation had lobbied for the extension of these reliefs and drew attention to the EU’s review of State Aid supports under the Agricultural Block Exemption Regulation, which is due to expire on December 31st, 2022.
Keane stated: “It is now critical that the government engages proactively with the EU on the Agricultural Block Exemption Regulation with a view to getting an increase in the lifetime threshold for young farmers from €70,000 under state aid rules to €140,000.”
“The timing of the review of the Agricultural Block Exemption Regulation remains concerning as it coincides with the expiry date of the current Irish young farmer tax reliefs and therefore must not impact on the orderly extension of both young farmer stamp, stock and consolidation reliefs,” concluded Keane.
Other farm groups had not released statements at the time of writing.
Find out what measures That’s Farming readers wanted in Budget 2023.