Three-year superlevy payment scheme

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Three-year superlevy payment scheme

The Superlevy Payment scheme allows for farmers to pay their final Superlevy fine over 3-years, interest-free. The National Exchequer is required to advance the full levy payment to the EU by the end of 2015, and to bear the interest cost.

Farmers had to apply to take part in the Superlevy Payment Scheme by June 30th, 2015

DAFM Frequently Asked Questions on the scheme
EU Regulations for the scheme

Main aspects of the scheme

Eligible farmers:

• Must accept liability (Legally binding agreement to be signed with DAFM)
• Must be active milk producer
• Must have no outstanding debt with DAFM
• Must agree formal repayment agreement with co-op (current or new if bill was incurred while supplying diff co-op)
• Must accept to be bound by agreement

State aid rules

The scheme is governed by State Aid rules. This means that recipients are limited to €15,000 aid over a rolling period of 3 fiscal years.

This limit applies to any aid or payment received by the farmer under any scheme similarly governed by State Aid rules. This would include aids received under the Beef and Sheep Technology Adoption Programmes, the Development Programme for Dairying, Cash Plan 2014, the Milking Skills Course, and the Beef Genomics scheme. It is expected that few dairy farmers would have received significant enough payments through any of those to be brought over the €15,000 3-fiscal year limit.

The only element included in this limit for the 3-year superlevy repayment scheme is the interest relief. There is no definite indication as we write, but the interest rate charged is likely to be not much more than 2%. Again, few if any farmers with even major bills would be put over the State Aid limit by this scheme alone.

Should an individual farmer find him/herself in excess of the limit, they will be able to use the extended repayment scheme if they wish, but will have to pay the full interest rate – which is likely to be significantly more competitive than any alternative.

What the farmer had to sign up to

  • Accept liability for the total Superlevy debt (which the DAFM may reduce following the allocation of the outstanding national reserve where relevant)
  • Agree to pay at least 1/3 of the liability by 1st Sept 15 through his/her co-op
  • Mandate the co-op to deduct a fixed amount of the farmer’s choosing from his/her April to August 16 and April to August 17 milk cheques, ensuring that 2/3 of the bill is paid by 30th Sept 16 and the full bill is paid by 30th Sept 17.
  • Agree that, if he/she fails to pay, the full value of the debt falls due immediately with interest, and the DAFM has the right to collect it from DAFM payments due to the farmer
  • Agree that in the event of death his/her estate becomes liable for any outstanding debt
  • Agree that if there are any change of status (incorporation, partnership, etc.), change of milk purchaser, exit from dairying, the bill becomes due immediately with interest, unless the farmer agrees a new payment arrangement with the DAFM in advance.
  • Agree that the DAFM may institute legal proceedings to recover any sums owing due to this agreement.

What the co-op had to sign up to

  • Arrangements are in place to collect the first 1/3 to be paid before 30th Sept 15 to DAFM, whether the supplier is still with the co-op or has left for a new one
  • Farmer has mandated the collection of the levy as set out above for 2016 and 2017
  • Co-op will pay the monies received to DAFM by 30th May, June, July, August and September 2016 and 2017
  • Co-op to notify Dept if farmer ceases to supply them or fails to pay in time.

UPDATE – September 2015

  • EU total bill €750-800
  • German bill €330m approx (highest)
  • Irish bill €69m approx
  • 6,000/17,500 have liability
  • 3700 have applied for 3-year scheme
  • Of which 2200 Glanbia, 550 Dairygold, 350 Lakeland
  • From a few €100’s to around €100,000
  • All but a handful of applicants have been cleared by DAFM, including those who had already paid in full but wanted to avail of the scheme (and therefore get money back from co-op).
  • Those as yet uncleared – main issue is ability of DAFM to recoup debt from them, all are expected to be resolved.
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