Farm assets to enter college grant formula
With a full proposal on how farmers should be assessed for college grants due before the end of the month, it is timely to look at how an asset test that includes farm assets might work.
Both Minister for Finance, Michael Noonan, and Minister for Education, Ruarí Quinn, have indicated that some assets excluded from means testing for education grants in the past will be included in the future.
The Capital Asset Implementation Group has been tasked with providing a technical report on how this new means test would operate.
Tables 1 and 2, above, show how means testing for college grants is currently calculated.
In the absence of details on how a means test that includes farm assets would operate, we've looked at how a farm would fare if it was subjected to the current formula for means testing for social welfare payments. Table 3 shows how this type of means test works .
Table 4 shows how a farm worth €640,000 could be treated if the farm asset was to be taken into account if the social welfare means testing arrangements were used for college grant means testing in the 2012-2013 year. The result shows how big an effect on weekly means an asset can have.
The ICMSA contend that farm assets are a productive business asset and should be considered a tool of the trade. In other words, farm assets should not have any capital value attributed to them other than the income derived from their use.
If farm assets were included in means testing, it is possible that thousands of farm families could be denied an opportunity to access third-level education, discriminating against the farming sector.