Through Parliamentary Questions and in other debates in Dáil Éireann I have continually highlighted the unacceptable delays in rolling out the low cost Agri Loan Scheme which was announced in the budget one year ago.
This Scheme has been announced again and unfortunately more delays will occur.Farmers need access to finance at reasonable cost due to the ongoing pressures on farm incomes.
For Written Answer on : 11/10/2018
Question Number(s): 142 Question Reference(s): 41644/18
Department: Agriculture, Food and the Marine
Asked by: Brendan Smith T.D.
To ask the Minister for Agriculture; Food and the Marine when the low cost agri-loan scheme will be made available as promised in Budget 2018; and if he will make a statement on the matter.
In his Budget speech my colleague the Minister for Finance and Public Expenditure and Reform, Paschal Donohoe TD, formally announced progress in relation to the development of the “Future Growth Loan Scheme” for SMEs, including the primary agriculture and seafood sectors. This is a key Government Brexit response for which I had provided €25 million in funding in 2018.
The Food Wise 2025 strategy outlines the agri-food sector’s unique and special position within the Irish economy and its potential for future growth. Brexit is obviously a significant challenge given our unique exposure to the UK market. Farmers, the seafood sector and food businesses will need to focus on competitiveness and innovation in order to continue the growth in Irish agri-food exports, which reached a record €13.6 billion in 2017. The Scheme forms an important part the Government’s Brexit response alongside the “Brexit Loan Scheme”, the provision of additional resources to the agri-food and enterprise State Agencies and an intensification of Minister-led trade missions to access and develop new markets.
The Scheme, which will be administered by the SBCI and backed by a European Investment Fund counter-guarantee, will bring previously unavailable 8 to 10 year unsecured investment finance to the Irish market at competitive interest rates. I am working with colleagues the Minister for Business, Enterprise and Innovation, Heather Humphreys TD, and Minister Donohoe, to bring up to €300 million of loans to the market.
This is a long-awaited source of finance for young and new entrant farmers, especially the cohort who do not have high levels of security. It will also serve smaller-scale farmers, who often do not have the leverage to negotiate for more favourable terms with their banking institution.
Along with the likes of Milk Flex, this Scheme will form part of a comprehensive investment package for farmers. I am also delighted to be able to include the seafood sector in the Scheme
Food companies have identified long term investment finance of up to ten years as a critical need which is currently unavailable in Ireland. I am pleased that the Government have been able to deliver this product and its effects will be felt all along the food production chain.
My Department is providing 40% of the funding so an overall agri-food package of at least €120 million will be available. However, unlike previous Schemes, this can be reviewed and adjusted according to demand.
Further details will be provided in the coming months. The Scheme is expected to be in place in early 2019 and will run for three years from its launch date.