13 JUNE 2016

ICSA rural development chairman Seamus Sherlock has expressed deep concern over the increasingly prevalent use of garnishee orders by creditors in the case of family farm debts. 

Garnishee orders typically provide that EU payments owed to farmers by the Department can be frozen in favour of the creditor. The process of obtaining this is stacked in favour of the creditor who can get the order without giving the debtor a chance to state his case in the first instance, and the only option available for the debtor is to appeal to the courts. Garnishee orders can also be applied to other monies and payments available to the debtor but EU payments due to farmers are the most obvious and straightforward target in most cases.

“It is a very ruthless process which is becoming more prevalent in the face of widespread debt issues on Irish farms. Of course, the problem is compounded by farmers who are under immense stress and tend to put their heads in the sand rather than facing up to the difficulties.”  

“However, it must be understood that the granting of a garnishee order completely compromises the viability of a farm and has a potentially devastating impact on cash flow, which in turn means that the farmer is less likely to be able to trade his way out of difficulty.  This is obvious when one considers that on most cattle and sheep farms, the value of EU payments is more than 100% of the total income that can be earned from the farm.”  

ICSA believes that there must be a common sense approach to debts on both sides, and that the interests of all concerned are best served by a long term solution. “ICSA holds no brief for anyone who wants to walk away from negotiation but we are actively encouraging farmers to face up to their situations sooner rather than later. Farmers should seek professional advice and guidance and try to reach a sustainable settlement with creditors.  ICSA wants to help farmers who are in this position.”

ENDS