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Matt Carthy: Contractors must be supported with rebate on carbon tax

Matt Carthy


Matt Carthy

Matt Carthy

Minister Charlie McConalogue says the Government has no plans to increase ECR supports

Minister Charlie McConalogue says the Government has no plans to increase ECR supports


Matt Carthy

Minister Charlie McConalogue recently confirmed to me in response to a Dáil question that Government do not intend to apply co-financing to the European Crisis Reserve to support struggling farmers.

While Ireland received €15.8m from the European Crisis Reserve (ECR), the European Commission gave member states significant flexibility to increase supports to farmers by up to 200pc through direct exchequer funding, potentially unlocking a further €31.6m in supports for Irish farmers.

Considering that the Irish Government party regularly cite EU rules as reasons not to intervene in the cost-of-living crisis, it is unforgivable that they do not intend to utilise such a measure when available.

This Government has form in this regard. It was largely the story of farmers on this island that ensured Ireland secured almost €1bn through the EU’s Brexit Adjustment Reserve, but virtually none of the money has made its way to Irish farmers other than the recent (welcome) announcement of a €3m allocation to the seed potato sector. On the other hand, meat processors have secured a €100m package.

The failure of Minister McConalogue and his Government colleagues to intervene in a robust and timely manner has had a negative impact. It is as if they don’t understand that the increased costs faced by farmers lead to higher grocery costs for everyone else. Government inaction is adding to the cost-of-living crisis.

Fuel costs

The cost of fuel is a main driver of the difficulties faced by farmers.

Much of the work carried out on farms is done by contractors, but contractors cannot get a rebate for carbon tax as farmers can.

Farm contractors were first promised a review of this in 2019, but it has been delayed repeatedly since then, with the Minister for Finance Paschal Donohoe now promising delivery of the review later this year.

Crucially though, the minister has not committed to acting following that review. The simple fact is that farm contractors carry out the exact same work as farmers, and the refusal of Government to commit to reform simply results in these charges being passed on to their farming customers.

It has been incredibly frustrating to see Minister Donohoe repeatedly delay this review. His colleague, Minister McConalogue, does not appear to be pressing him on the matter.

It is yet another example of the challenges facing those involved in Irish agriculture today being compounded by the lethargic attitude of this Government towards resolving long-standing inconsistencies.

It is particularly galling that in the most recent response to parliamentary questions, Minister Donohoe has said he must ensure tax measures are aligned with the “the need to meet our Climate Action Plan”.

Would the minister believe it to be more beneficial if every single small-to-medium sized farmer in the State set about purchasing a personal fleet of agricultural machinery?

That we would penalise both farmers and farm contractors for this type of approach is beyond belief and makes no sense from the perspective of meeting our climate obligations.

There can be no further delays. During a period of escalating input costs, farmers need support. One such support must be through a rebate of the carbon tax for those doing essential agriculture work for which there is no fuel alternative yet.

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Matt Carthy TD is the Sinn Féin spokesperson on agriculture.

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