First Meeting of IFA Led Dairy Industry Investment Group
IFA held the first exploratory meeting of the Dairy Industry Working Group on Farmer Investment, convened with co-ops, Irish Dairy Board and ICOS representatives in order to develop an investment scheme template which would allow farmers make tax efficient, voluntary financial contributions towards the funding of expansion in the dairy industry. The Group was established as part of IFA’s recommendations on co-op shareholding in January.
“We have set up the Group to work on this proposed scheme, in order to move away from the facile meme that “the milk price will pay”,” Kevin Kiersey said.
“Dairy farmers will need to invest up to €1.5b on farm to deliver the extra milk which will make the dairy industry expansion possible. Therefore, it is simply not realistic to expect that the milk price or the farmer would carry the entire cost of the processing and marketing expansion required,” he added.
“We see the financing of the dairy industry expansion as a complex plan which must be bankable and requires contributions from all stakeholders. We therefore see our proposal to develop an investment scheme template to facilitate tax efficient voluntary contributions by farmers as part of such a funding plan,” he said.
“Today’s first meeting of the Group is exploratory in nature, and will seek to establish common ground in the needs identified by industry. We will then progress to draw up, with professional tax advice, an industry-wide voluntary farmer investment template, for which we will seek tax relief from Government,” he said.
“This is about an industry finding ways to fund itself, and while tax relief is revenue foregone by the State in the short term, it is also an investment in increased export and ultimately tax revenue in future years. We believe this is totally coherent with the Food Harvest 2020 strategy. With good industry cohesion on this proposal, I believe we have a good chance of succeeding,” he concluded.