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Minister confirms Department allocation for 2009

Speaking after the presentation to the Dáil of the 2009 Supplementary Estimate, the Minister for Agriculture, Fisheries and Food, Brendan Smith TD, confirmed that his Department's allocation for this year is €1,985 million.

While this represents an increase of €182 million on the amount originally provided in last October's Budget, the increase is accounted for by additional funding already agreed for the Pigmeat Recall Scheme and the arrangements announced for the payment of grant aid under the Farm Waste Management Scheme. Apart from those two elements, the Minister said that the Supplementary Estimate contained a number of cuts to payments and services in his Department.

The Minister explained that "in view of the significant deterioration in the public finances and, particularly the ongoing decline in tax revenues, the Government has had to take very difficult decisions to address the deficit, restore stability to the public finances and provide both domestic and international confidence in the economy.  That has required the Government to strike a careful balance between increased borrowing, higher taxation and reduced spending, with consequences for every sector. Mr Smith said that tax receipts this year were now back to 2003 levels, which require a significant adjustment in the levels of public expenditure." 

Mr Smith said that, despite the significant deterioration in the public finances since last October, the Government would continue to support the agri-food, fisheries and forestry sectors as far as possible within the constraints of the public finances and overall programme of expenditure savings announced in the Supplementary Budget. Total expenditure by the Department in support of the agriculture, fisheries and food sector will amount to over €3.3 billion, when the Department's Vote is combined with EU funding of €1.4 billion.

The Minister said that the revised allocations "provides €220 million for Farm Waste Management grants to give effect to the Government decision to pay 40 per cent of the remaining 17,000 grants this year, an increase of €95 million on that provided in the Abridged Estimates, published in October."

Mr Smith also confirmed that his Department is allocating  €165 million to provide financial assistance towards the costs associated with restoring market confidence following the discovery of dioxins in certain pigmeat last December.  This is in addition to €35 million provided to the sector in December.  The Minister said that this was "essential expenditure to secure the future of the Irish pig production and processing industry, worth €1.1 billion annually."

Minister Smith said that he was also providing an additional €2.5 million to An Bord Bia to assist in its vital work in promoting Irish food exports in overseas markets.  Mr Smith described Bord Bia's work as "more important than ever in the current economic climate, not least following the pigmeat dioxin issue".

The Minister went on to outline the reductions in expenditure which will be implemented following the Supplementary Budget decisions.

The Minister announced that the funding being provided for the Rural Environment Protection Scheme (REPS) in 2009 is €330 million, compared with expenditure of €314 million in 2008. Minister Smith said that this allocation "compares very favourably with a provision of €190 million in 2003, when tax receipts were comparable to those of today, and the average annual payment in REPS was €4,800".

Mr Smith said that "REPS has been successful in meeting environmental imperatives and consumer demands for environmentally-friendly food production. Given the level of participation in REPS 4 and the pressures on the public finances and having considered other alternatives I have decided to reverse the 17% increase in REPS 4 payments. REPS applications will continue to be accepted up to the predetermined closing date of 15th May and, depending on the number of applications received, I will then review the payment level for REPS 3 participants. I will be also be carrying out a review of the scheme in the context of the overall level of participation, the funding which is likely to be available to me and the flexibility provided by the additional funding which I negotiated in the recent CAP 'Health Check'.

In the context of 2010, I intend to look at and discuss with our stakeholders how we can use unused CAP funds and modulated monies, including the options in relation to REPS, to achieve the maximum benefit for Irish farmers and the agri-food sector."

Minister Smith also confirmed that the rate of forestry premia is being reduced by 8 per cent with immediate effect.  He said that "this reduction in premia has to be balanced by the decision to maintain the establishment grant scheme, which is the lifeblood of planting and employment in the forestry sector."

The Minister also confirmed that his Department's contribution to the Fallen Animals Scheme would cease with effect from Tuesday 15th April 2009.  Arrangements are being made for a measure to assist the collection of certain animals, notably bovines over 48 months of age, for sampling, as required under the national BSE surveillance programme.

In relation to the Suckler Cow Welfare Scheme, Mr Smith said that he decided that "the rate of payment for 2009 will be €40 per animal, to be paid in 2010, as I indicated at the time of the October 2009 Budget. I hope that confirmation of the rate of payment under this new income stream will bring clarity to those participating farmers and ensure that the benefits of participation in the scheme will continue."

The Minister said that his Department would be advancing it's own efficiency programme which has seen staff numbers fall by over 600 in the past four years, with a commitment to reduce overall staff numbers by another 250 by the end of next year.  In addition, there would be significant reductions in the cost of overtime and other staff-related costs this year.  Mr Smith said that it was "incumbent on the Department to review and reduce its costs, while maintaining the quality of service delivery and this can only be achieved by constantly pursuing additional efficiencies, including issues as to how and where we deliver our client services."

The Minister said that there were a number of other smaller adjustments to various Departmental activities which will be announced in the Revised Estimates Volume.  The Minister said that his intention is to continue to manage every aspect of the Department's expenditure to achieve maximum benefit for the Irish taxpayer in these difficult times. 

In conclusion, Minister Smith said that "nobody should underestimate the scale of the economic challenge facing this country and nobody can be immune from its consequences.  We are trying to maintain public services at current or recent levels against a background of rapidly declining revenues.  This is simply unsustainable and requires radical correction.  Today's Budget is a start in the process which will take several more years to complete.  I am acutely conscious of the difficulties being experienced across the agri-food sector at all levels.  What I have tried to do is to minimise the impact on the sector at both producer and processor level."

7 April 2009

Date Released: 07 April 2009