24th August, 2012
ICSA president Gabriel Gilmartin has called on the Minister for Education, Ruairi Quinn, and Labour Party chairman, Colm Keaveney, to clear up the misinformation about farmers and third level grants. “For the last few weeks, all kinds of misinformation has been allowed to fester regarding third level grants. The biggest lie is the notion that the system allows a farmer to buy, for example, a tractor and use the full cost of that tractor to wipe out income, thereby qualifying the farmer’s child for a third level grant.”
“The truth, as Minister Quinn and Deputy Keaveney should know well, is that such investments are not allowable when calculating eligibility for the grant. In fact, all capital investments, including farm machinery, livestock housing and pollution control facilities are expressly excluded – not only under the new system operated by SUSI (the new, centralised grant application system) but also under the old local authority/ VEC application system.”
“In fact, the rules state clearly that interest incurred on borrowings for such investments is also not allowed, nor is the leasing cost of machinery. This actually puts farm families at a significant disadvantage compared to other sectors. Farmers need to reinvest in their businesses in order to remain viable – or in some cases, in order to comply with Department of Agriculture regulations – and this reinvestment, and associated interest charges, means that there is much less money left to put food on the table or to pay for their kids’ education costs.”
Mr Gilmartin also argued that the perception that farmers can manipulate their income in order to have a “bad year” for the purposes of grant assessment is incorrect. “The reality is that farm incomes are volatile and can fluctuate dramatically from year to year. This is more and more a feature of farming, as the CAP is now more oriented towards direct payments for environmental goals, rather than price support. To illustrate this reality, the average farm income two years ago was €11,968 according to the Teagasc National Farm Survey for 2009, compared with €24,361 for 2011. Incomes for 2012 are likely to be down again.”
“Therefore, ICSA believes that the fairest way of overcoming any doubts, while ensuring fairness for farm families, is to assess farm incomes based on the accounts of the preceding five to seven years. The information is freely available from farm accounts and the records of the Revenue Commissioners and this would dispel any doubts about good years and bad years.”
Mr Gilmartin reiterated that ICSA is firmly opposed to any means testing based on assets, and that the association will be lobbying all TDs on the matter in the coming weeks.