The Department of Agriculture, Food, and the Marine is “not responding quickly enough to rising building costs, especially steel”.
That is according to IFA rural development chairman, Michael Biggins, who said the increases are having a knock-on effect on items such as LESS equipment and meal bins, which is adding “significantly” to costs for farmers doing TAMS work.
“Delays in issuing approvals, coupled with COVID-19 disruption, are forcing farmers to reprice jobs, and they are finding big increases in quotations.”
“Materials, such as steel and concrete, have seen steep increases because of problems with supply chains. In some cases, farmers are having difficulty in sourcing materials. The dept response has been too sluggish and is not reflecting the reality on the ground,” he added.
‘It is not acceptable that farmers were promised either a grant of 60% or a grant of 40%, with the Department basing their costings on outdated data from 2018 and earlier figures,” he said.
Labour priced at €15/hr
Biggins said if costings are not regularly updated, grant aid’s value due to the farmer is reduced.
The percentage of grant aid is based on the standard or reference cost payable at either the basic 40% grant rate or in the case of young farmers at 60%. He said it is important that the grant paid broadly relates to the actual costs incurred.
“We welcome the commitment to review the reference costings by the department of agriculture. It must be completed without delay. The review must take account of all the data available that clearly show building costs have increased since the last review.”
“In the case of own labour, where a farmer carries out some of the work, it is currently costed at €13.50/hr. This has not been reviewed for over two years and needs to increase to €15/hr.”
Biggins said that any review must include all applications currently in the system. In conclusion, he said the impact of a costings increase would mean that a farmer gets a more accurate grant rate relative to investment costs incurred, excluding VAT.