Committee Reports > List of Committees > Joint > 1976 > Committee on the Secondary Legislation of the European Communities > Report No. 24 - Special Aid for Young Farmers

REPORT

1. Introduction

The Joint Committee has completed its consideration of a proposal for a Council Directive on a special aid measure for young farmers who have been farming for less than five years and are implementing a development plan [R/3358/74].

The proposal is linked with the Farm Modernisation Scheme initiated by Council Directive 72/159/EEC of 17th April, 1972. It is intended to deal with problems peculiar to young farmers who are operating development plans under that scheme. Exceptional financial burdens may fall on young men farming on their own account for the first time perhaps because of obligations to pay for assets and stock or to compensate co-heirs and the proposed Directive is intended to ease their situation.

2. The Draft Directive

The Commission proposals as submitted to the Council in December, 1974 would oblige Member States to give special aids over a period of five years to farmers under 40 years of age operating a development plan who had commenced farming on their own account within the previous five years. The grant of aids would be conditional on the development plan providing for a minimum investment of approximately £5,900.

The total aid to be provided would amount approximately to £1,947 of which £590 would be given in the first year, £472 in the second, £354 in the third, £295 in the fourth and £236 in the final year. Twenty-five per cent of the expenditure would be met from the Guidance Section of EAGGF.

3. Possible Amendments

The Joint Committee understands that the proposal has been considered by a working party on agricultural structures on the instructions of the Special Committee on Agriculture. Although apparently some Member States appear to be opposed to the proposal on principle, it is understood that certain amendments have been put forward in the working party.

These would effect the following changes in the proposed Directive:—

(a) Member States would be free to fix an age limit not exceeding 40;

(b) the minimum investment level needed to qualify for the special aid would be raised to about £7,080;

(c) the total amount of the special aid would be about £1,947 but, subject to that limit, Member States would be free to relate the level of aid to the amount of the investments envisaged in the development plan;

(d) the aid would be paid over 3 years instead of 5 e.g., 40%, 40% and 20%.

4. Views of European Parliament and Economic and Social Committee

Both the European Parliament and the Economic and Social Committee considered the original proposals from the Commission and they have reported favourably on them, the European Parliament pointing out that the measure only applies to a very small number of farmers.

5. Views of the Joint Committee

The Joint Committee believes that the Commission is correct in its proposition that young persons entering farming on their own account for the first time experience initial difficulties for which special assistance is needed to overcome them. Such assistance could be of particular significance in the case of Ireland where special efforts are required to keep enough young people on the land to sustain economically viable holdings and where anything that encourages earlier assignment of farms to young persons should be encouraged. However, the present proposal is set in the context of the Farm Modernisation Scheme and is confined to young farmers who are operating a development plan under the scheme. At present, therefore, the proposal would be of a limited value because few young farmers in the circumstances of this country can meet the excessively high and unnecessarily rigid standards required for development farmers. The Joint Committee is of opinion that the first priority ought to be the improvement of the Farm Modernisation Scheme particularly in relation to the methods of fixing comparable income and calculating the earned income of the farm.

An improved Farm Modernisation Scheme more suited to the needs of Irish farmers would make the proposal now under examination much more attractive. However, in relation to the amendments proposed in the working party, the Joint Committee is opposed to the suggestion that the minimum level of the investment needed to qualify should be increased. If the figure of 10,000 units of account is considered too low by some Member States, they could be given the option of setting a higher figure for themselves but as far as this country is concerned, the figure is already a relatively large amount having regard to the general level of farming incomes. Moreover, in regard to the amount of special aid proposed, the Joint Committee considers that provision should be made for periodic review and adjustment to offset inflationary trends.

6. Further Consideration by Council

The proposed Directive was considered by the Council on 19-20th January, 1976 and referred back for further consideration at official level. It is expected that the proposal will come before the Council again in April, 1976.

7. Acknowledgement

The Joint Committee wishes to express its thanks to the Irish Farmers’ Association and the Irish Creamery Milk Suppliers’ Association for their assistance in its consideration of this proposal.

(Signed) CHARLES J. HAUGHEY,

Chairman of the Joint Committee.

24th March, 1976.