Farming News - Budget 2027 provides some relief but more needed for farm viability
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Budget 2027 provides some relief but more needed for farm viability
ICSA Rural Development chair Edmond Phelan has said Budget 2027 contains some welcome measures for farmers, but the lack of any increase in the overall allocation to the Department of Agriculture raises serious questions about whether the Government is doing enough to support farm viability. "Farmers are currently trying to cope with extremely high costs, and many are struggling to make the numbers add up. Against that background, it is difficult to see how the Government can deliver the level of support farmers need when there is no increase in the overall allocation to the Department of Agriculture," he said.
On fuel costs, Mr Phelan said the Budget provides some short-term relief but does not go far enough to tackle rising fuel costs. "Fuel costs have become one of the biggest pressures facing farmers and we need to see a proper response to the cost of agricultural fuel. The extension of the Fuel Income Support Scheme will provide some welcome breathing space for farmers facing very high fuel costs. However, we have to question why €31.2 million has been allocated for the further five-month period when around €58 million of the original allocation remained unspent."
"Farmers need more than temporary relief. Fuel has gone from being a manageable part of the cost of running a farm to becoming a major and increasingly damaging cost. The reduced excise rates will now remain in place until the end of February, which is welcome, while the suspension of further carbon tax increases is also welcome. However, the phased restoration of excise from March to June next year means that farmers will continue to face rising fuel costs. We need a lasting solution that gives farmers greater certainty over what it will cost to run their farms."
On fertiliser, Mr Phelan said, "ICSA welcomes the €31 million national top-up to the EU Fertiliser Support Scheme, bringing the overall fund to almost €46 million. Fertiliser is a fundamental cost for farmers and this support is welcome, but the scheme needs to be rolled out quickly and farmers need clarity on the detail and when payments will be made."
On the national farm schemes, he said ICSA would examine the detail as it becomes available, but the €22 million allocation for the National Sheep Welfare Scheme is already a concern. "This is the same allocation as last year, when payments were cut because the scheme was oversubscribed. That is not good enough for a low-income sector that needs support to remain viable. If a scheme is oversubscribed, that should be a signal that more funding is needed. It should not result in farmers receiving less."
On generational renewal, Mr Phelan said the removal of the three-year holding period for Succession Farm Partnerships and the increase in the tax credit from €5,000 to €10,000 were positive steps but said much more needs to be done to support generational renewal. "Succession is one of the biggest challenges facing the future of Irish farming. These measures are welcome, but the starting point has to be viable farms. The next generation will not take over farms if there is no sustainable income from farming."
ICSA also welcomes the extension of accelerated wear and tear allowances for farm safety equipment to the end of 2029, including the addition of 12 further items, as well as the increase in the farmer flat-rate VAT addition to 4.8%.
Mr Phelan said ICSA would examine the full detail of the Budget measures before making a final assessment. "There are positive measures in Budget 2027 and we welcome those that will make a practical difference to farmers. But the real test is whether this Budget does enough to reduce the cost of production, strengthen farm incomes, and keep our family farms going. Farmers cannot build a future on temporary relief and underfunded schemes."