Wednesday 28 September 2016

Coveney pledge on cheaper finance deals

Martin Ryan

Published 02/12/2015 | 02:30

Minister Simon Coveney
Minister Simon Coveney

A commitment to cheaper finance packages by mid-2016 has been given to farmers by Agriculture Minister Simon Coveney, who has described the cost of finance for farmers as at an "unacceptable" level.

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Addressing the ICMSA Annual Meeting at Limerick, the Minister said banks are very interested in doing business with the agriculture sector, but the interest rates being charged on farm loans place farmers here at an uncompetitive position relative to other EU countries.

"I think it is likely that we can have a new financial package in place by the end of the first half of 2016," he told the farmers, explaining that the finance will be targeted at special areas of farm development.

"The way it is likely to work is that a new financial product will be guaranteed by the Department of Agriculture through the Development Fund, and allows for low interest loans which will probably be administered through one of the pillar banks for specific type of projects - doing strategic jobs on the farm - probably linked to the TAMS," he said.

He told dairy farmers that he would also like to see a structure aligning annual repayments to farm product prices in that year, because of the volatile nature of the markets, and "a holiday" period should be possible in years when farmers are making no money.

ICMSA president John Comer called for action to put manners "on our banks" and accused them of "gouging" on interest rates.

"Irish farmers on an annual basis are paying €80m more in interest charges than their EU counterparts.

"To put in context, this is more than what we paid in superlevy this year," he said.

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