NI farms may need more support – Poots

Further financial support may be needed to get NI farmers through the coronavirus crisis, DAERA Minister Edwin Poots has said. A £25m aid package from the NI Executive to support the dairy, beef and horticulture sectors was announced last week.

However, Minister Poots said that more money may be needed if producer prices come under renewed pressure over the coming months.

“While the £25m is welcome, it may not be sufficient. For example, every 1p/l of support to the dairy sector over six months would cost us £12m. A 5% fall in beef price would cost £10m over the same period,” he told Stormont’s agriculture committee.

In August and September, if we see a 20% reduction in lamb prices, then I could go back to the Executive

Minister Poots said that funding for other farming sectors would also be sought if prices fall because of COVID-19.

“In August and September, if we see a 20% reduction in lamb prices, then I could go back to the Executive,” he suggested.

DAERA is aiming to get the current aid package paid out to dairy, beef and ornamental horticulture producers by July.

It might help if we could get it out for that sort of time period

MLAs were told that most local banks offered farmers a three-month overdraft extension during the spring which would be finishing at the end of June.

“It might help if we could get it out for that sort of time period. It’s a very big ask to get it out for that time period, but at least if the banks knew it was coming, they could hold off for another month,” Minister Poots said.

Payment method

The method of allocating funding to farmers is still to be decided by DAERA, although the minister indicated that it is likely to be based on historic production on individual farms.

Under EU state aid rules, payments cannot be based on current or future production because schemes such as slaughter premiums can have market distorting effects.

“I also have to be mindful of overcompensating businesses, such as those who have already benefited from other government support measures or those not directly impacted by a reduction in farmgate prices,” Minister Poots said.

This is a risk that I have flagged with the Executive

The initial bid from DAERA to the Department of Finance was for a £105m coronavirus support fund for NI agriculture. This was based on potential disruption in processing supply chains which could lead to lost income and disposal costs for farmers.

While this hasn’t happened, Minister Poots warned MLAs that the threat of COVID-19 related problems in factories has not disappeared.

“This is a risk that I have flagged with the Executive as it could require swift action to address any consequential and acute on-farm crisis,” he said.

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