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Dáil
‹ Order of Business

Co-operative interest charges on farmers

Summary

Michael Healy-Rae raises concerns that co-operatives may impose heavy interest charges on farmers already burdened by weather-related debt. Coveney acknowledges the agricultural crisis and commends co-operatives for previously providing assistance, while indicating the matter is being considered.

Farmers are being subjected to crippling interest rates as co-operatives are re-introducing charges of 1% per month to accounts during the coming weeks. Bank sources have confirmed that almost all major dairy processors are hatching plans to impose interest on the huge mountain of debt that farmers incurred during this year's awful spring.

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Michael P. Kitt An Leas-Cheann Comhairle Fianna Fáil

Is there legislation in this regard?

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Yes, and I will tell you about it, a Leas-Cheann Comhairle. Although the weather is picking up a little, the Minister knows well that the crisis in agriculture has not gone away. I am asking the question under the strategic infrastructure Bill. What are the Minister and his Department going to do to deal with the co-ops? I commend the co-ops on the work they did in importing fodder to the country.

I do not want them to spoil the excellent work they did. I compliment our own co-op in County Kerry but also all of the other co-ops the length and breadth of the country.

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Michael P. Kitt An Leas-Cheann Comhairle Fianna Fáil

We cannot have a debate on the matter now.

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Yes, I am not debating it but what I do not want is for them to spoil the good work by placing crippling interest charges on farmers who, as the Minister is aware, are in a terrible, dark and bad financial situation.

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The Minister is doing a good job.

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Michael P. Kitt An Leas-Cheann Comhairle Fianna Fáil

I remind the Minister that we do not want a full debate on the issue.

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You might give me a little bit of latitude, a Leas-Cheann Comhairle. If I am allowed, I commend the co-ops-----

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Michael P. Kitt An Leas-Cheann Comhairle Fianna Fáil

Five more Deputies wish to speak.

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-----in Kerry and elsewhere, on the work they have done. We have come through a very difficult period in agriculture. The past six months has been very challenging for farmers. It has been a very expensive winter for them. As a result, many of them are in situations of debt which was not the case for them in the past. Much of the debt has been provided by co-ops, some of it interest-free to farmers in an effort to get them over a difficult period, in particular in terms of encouraging them to buy and spread fertiliser to get grass growing. Now co-ops are trying to get back to some kind of normality. One cannot expect co-ops to provide interest-free credit to farmers indefinitely. That is not a sustainable situation. I have spent a considerable amount of time speaking to both co-ops and banks to look at ways in which we can transfer some of the debt from co-ops into the banking system, which is where it belongs, under conditions with which farmers can live. The process will be ongoing through the summer, as will be the process of preparing for next winter to ensure we do not have a repeat of the situation we had last winter.

With respect to the Deputy, I am not sure the situation has much to do with the strategic infrastructure Bill but perhaps the response is somewhat helpful.

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