Farm lead­ers round on Min­is­ter over low-in­ter­est loan scheme

Creed’s pack­age falls down on lack of cash flow op­tions claim IFA and ICMSA

Irish Independent - Farming - - NEWS - DE­CLAN O’BRIEN & CLAIRE FOX

THE FAIL­URE of Min­is­ter for Agri­cul­ture Michael Creed to de­liver a promised low-in­ter­est loan scheme for farm­ers who are fac­ing se­vere cash­flow dif­fi­cul­ties has been lam­basted by the IFA.

The scheme, which was promised in Bud­get 2018 and which Min­is­ter Creed said would be on stream by the sec­ond half of the year, still hasn’t been de­liv­ered.

A €25m fund was se­cured by the De­part­ment of Agri­cul­ture which was to be used to lever fur­ther monies for the scheme.

The pre­vi­ous sup­port pack­age which was brought for­ward for farm­ers — the €150m Agri­cul­ture Cash­flow Sup­port Loan Scheme — was a mas­sive suc­cess and the plan was to struc­ture the lat­est scheme in a sim­i­lar fash­ion.

Asked why the pack­age which was cleared in last Oc­to­ber’s Bud­get was still not up and run­ning, Min­is­ter Creed pointed to the num­ber of de­part­ments and bod­ies were in­volved in the ini­tia­tive and he claimed that get­ting “all the mov­ing parts” to come to­gether was prov­ing dif­fi­cult.

How­ever, IFA pres­i­dent Joe Healy said the fail­ure of Min­is­ter Creed to de­liver the pack­age was “in­cred­i­ble”.

“It beg­gars be­lief ac­tu­ally that some­thing that was an­nounced last Oc­to­ber isn’t rolled out. There’s a prece­dent there for it and you’d imag­ine all the hard work was done on it the year be­fore.

“There was huge de­mand for it the pre­vi­ous year. It was over­sub­scribed de­spite what the Min­is­ter and the De­part­ment were say­ing to us that there wouldn’t be a de­mand for it. It was over­sub­scribed in less than three weeks,” the IFA leader pointed out.

“The de­mand would prob­a­bly be twice as much for it this year given the very dif­fi­cult year and huge costs, par­tic­u­larly at this time of year where you have farm­ers who want to pay the con­trac­tors, grain mer­chants and feed mer­chants. And the tax bill is around the cor­ner. We have called on the min­is­ter to treat it as an act of pri­or­ity to get that loan scheme out,” Mr Healy said.

Mean­while, the ICMSA leader Pat McCor­mack ex­pressed dis­ap­point­ment that the Longterm In­vest­ment Loan Scheme which was re­cently an­nounced by Min­is­ter Creed ex­cludes loans for the pur­poses of al­le­vi­at­ing cash­flow dif­fi­cul­ties.

De­tails of the loan scheme were out­lined by Min­is­ter Creed re­cently, with for­mal ap­proval for the pack­age ex­pected in early Oc­to­ber. The loans are de­signed to pre­pare farm­ing and SMEs for the ex­pected fall-out from Brexit and of­fered fi­nance at an in­ter­est rate of 5pc for cap­i­tal in­vest­ment.

How­ever, Mr McCor­mack said short-term fi­nance, rather than long-term in­vest­ment, was farm­ers’ pri­mary con­cern this year. “Farm­ers gen­er­ally will be as puz­zled as I am as to the rea­son­ing be­hind a de­ci­sion to not loan money to those in­di­vid­u­als so hard-pressed right now in terms of cash­flow,” Mr McCor­mack said.

“The ob­vi­ous point to make is that con­fin­ing the low-in­ter­est loans to cap­i­tal pur­poses is all very well, but there’ ll be an un­for­tu­nate num­ber who mightn’t get to make any de­ci­sion about a cap­i­tal spend be­cause they can’t get past the cur­rent cash­flow cri­sis,” he said.

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