Thursday, 7 June 1984
Seanad Eireann Debate
Mr. Fitzsimons: On the last occasion I gave my observations and personal views on a number of aspects connected with farming and with this Bill. In particular, I tried to make the point that farming, the farmer and the land have a particular place in Irish society. The Inter-Departmental Committee on Land Structure Reform published their final report in May 1978. It is a very comprehensive document and I could quote much from it which would be relevant in considering this Bill. I want to quote a very small  paragraph dealing with land functions in a modern economy:
Consequently, the relationships between man and land — such as land tenure, ownership and use — are central features of the structure of society. These relationships directly affect society's political philosophy, economic system, culture and social organisation (for example, tradition, laws, etc.)
That spells out exactly the views I have and which I tried to express then. I stated in addition that this Bill is a frontal attack on the conacre and 11-month systems of letting. While I understand the drawbacks of those systems, nevertheless in some areas they worked very well and the land in many instances was well looked after. There can be no blanket condemnation of the system and it probably will continue to live on even if leasing becomes successful.
In theory I can see the sense of leasing as opposed to letting but over the years the conacre system proved itself. I also spoke about the role of auctioneers in society. If leasing becomes widespread this role must diminish. Auctioneers have played a very important part: they have helped the farmer in many ways in determining the value of his land and they have provided free advice. I am not sure how the auctioneers as a body have reacted to this Bill but I see their role decreasing and the role of the lawyers increasing because the leases seem to be very complicated documents. While I understand that co-ops and groups in the agricultural area will help out, at the end of the day the document is a legal document and will need a lawyer to interpret it.
I ask the question: how will the farmer who is leasing his land determine the value of the lease or what he is to ask  for the land? Will there be built into it some method whereby with the fall in the value of money there will be corresponding increase and some kind of index linkage? I see this problem for long-term leases. I know there was a demand for this legislation for perhaps 25 years. I think a minimum length of lease should have been specified. In some areas we are talking of a three-year lease and various organisations have asked for a three-year lease, a five-year lease, a six-year or a 12-year lease. In the Bill there should be some definition of a minimum lease. I am totally in sympathy with the farming organisations because the farmer's role is a very difficult one. For as long as I can remember the farmer's lot was up and down and indeed mostly down. Many farmers cannot afford holidays. They work long hours and my total sympathy is with them.
In his contribution Senator Ferris stated that he supported some of the criticism but said his party would not permit the Land Commission to be a scapegoat or a whipping boy. I thought at that stage Senator Ferris was more or less trailing his coat because up until then there had been no major criticism of the Land Commission. Subsequently, Senator Connor in his contribution asked the Minister the proposals he will be bringing forward to scrap the Land Commission. He also stated that the Land Commission in the past have been shown to have been dogged by slow procedures, by an overly legalistic approach that at times almost amounted to a judicial approach.
The agency at present charged with the implementation of land policy, the Land Commission, and the policy instruments it employs are in the Board's view not capable of achieving this objective at a cost to taxpayers which can be justified. The Board, therefore, recommend that the Land Commission should be abolished. The reasons for this are being spelt out in the report of the Inter-departmental  Committee and elsewhere.
The cost of the Commission's activities in relation to the acreage of land allotted appears to be high. In 1981, for instance, the cost per acre allotted was £581 and the cost per average allotment was £8,706. This cost is not recoverable by the State. If the Commission's activities are seen as having primarily a social welfare objective this cost appears exorbitant, bearing in mind that the enlargement of a holding does not per se ensure a higher standard of living for the beneficiary. Even conceding that the Commission's allotment programme may yield a net improvement in productivity, there exist more cost effective policy instruments capable of achieving that objective.
In 1978 the report of the Inter-Departmental Commission on Land Structure Reform indicated that the price per acre was around £200. In this section it is grossly unfair to work out a price per acre at a period when the acreage was decreased out of all proportion, because I believe that in the early years the average would be about 30,000 acres whereas in the last few years it came down to about 7,000 acres. To work out a unit cost per acre at a time when this work had virtually ceased is unfair and paints a wrong picture.
I would be critical of the Land Commission, in some areas but I want to make it clear that I would not be in favour of abolishing the Land Commission because from the start their objectives have been achieved and I see no reason why they cannot undertake other areas of work which are essential, such as promoting this leasing programme. I agree that the Land Commission have been slow in almost all their work but at the same time I am conscious that people who got land from the Land Commission got it with a clear title, and that took time. There was  not sufficient land to be distributed, and on many occasion the Land Commission were waiting for more and the acquisition was a slow process. In regard to the 11 month system of letting, the Land Commission were the worst offender because some farms were let for as long as ten years or more. There could not be any justification for this.
I am critical of Land Commission house design. I know that it is easy to be wise with hindsight but it is a pity that more work did not go into the planning of the Land Commission houses. At that time we had the Congested District Board cottages which were, in their time, a considerable leap forward, but the Land Commission designs were largely based on the Irish Land Provision for Sailors and Soldiers Act, 1919, which were built by the British Government. That was a pity. I always felt that the Land Commission should have considered clustered design which was typical of Irish development where houses would be in groups. This has much to recommend it, such as infrastructure, water, roads, sewerage and so on. The Land Commission's roads were narrow, they followed the hedges and the fences and, while in one sense they were very much in sympathy with the environment, there was no looking forward, with the result that many of them are merely lanes now and unsuitable for the traffic which uses them.
I am also critical of the Land Commission in the area of allocation of farms to women. I know that single men have got farms from the Land Commission over the years in my own area of County Meath, but I have never known women to get farms and I am wondering is there any reason why they did not.
In some instances the acquisition of land might be unfair, but the courts are there to deal with this. I know of one case before the courts at present regarding land which I feel has been unfairly acquired but I think that justice will be done. It is easy to be critical but the Land Commission did a very good job and for that reason I would not agree with their abolition.
 I should like to give a brief synopsis of the Land Commission over the years, to show the work they have done and give the reasons why they are a body that could be charged with making this Bill and land leasing successful. The Land Commission were established in 1881 under Gladstone's second Land Act. Their purpose was as a rent fixing body to control landlordism and they succeeded in doing so. That success nurtured the idea of the total abolition of landlordism, and the Land Commission were entrusted with the task to the extent that it became their main function. Again it was successful, and finally in 1923 what was left of landlordism was wiped out with a single stroke. With rents reduced to reasonable amounts and landlords being replaced by the Land Commission who allowed farmers to buy out their land by the instalment system, it was found that something more was needed. Small, scattered and fragmented farms needed to be enlarged and unified and, in the process of achieving this objective, the Land Commission became identified in the popular image with the dispossession of large landholders and redistribution of land as their primary function.
As everyone knows, the background to the Land Commission is that through past centuries, but especially between the years 1555 and 1697, the English had carried out confiscations and plantations. The land was taken from the Irish and divided amongst colonists and planters whose descendants were mainly responsible for the penal laws of the eighteenth century. By the middle of the nineteenth century the Irish peasant farmer was, in reality, no better than a slave. He was a tenant at will, holding his land at the whim of the landlord and paying an exorbitant rent. There was a degrading system of payment backed by all the resources of the law and the Government. Between 1849 and 1882, almost 500,000 families, around 4,000,000 people, were evicted and thrown on the roadside. The tenant farmer was discouraged by the system from making any improvement while the landlord was simply a leech living mostly abroad in style and comfort on the sweat and blood of  his tenants. The result was a period of evictions, secret societies, such as the Whiteboys and Moonlighters, assassinations and cattle maiming. The Government simply replied with repressive measures and between 1830 and 1875 as many as 47 Coercion Acts were passed.
At the darkest hour two great leaders came on the scene, Michael Davitt and Charles Stewart Parnell, who was himself a landlord. In 1879 Davitt founded the Land League and it swept the country. Reform could not be delayed any longer, and the progress of that reform is the story of the Irish land code and especially of the Land Commission. Progress was slow at first but the Land Act of 1881 granted the “Three Fs”, fair rent, fixity of tenure and free sale which the Tenant League had unsuccessfully campaigned for in 1852. The Land League of 1879 demanded nothing less than the obtaining of the ownership of the soil by the occupiers. Gladstone's first Land Act of 1870 had been very little help to the tenant since it left fixing of rents completely in the hands of landlords. Under this Act, less than 500 tenants were able to avail of the limited state aid to purchase the holdings. The Land Commission was constituted to administer the 1881 Act and in a few years fair rent had been fixed for 275,000 holdings in the 26 counties. These were 21 per cent lower than previously payable. Fifteen years later 93,000 of these were reduced by another 18 per cent and 15 years later still, 3,000 of them came down by a further 9 per cent but for most people, the possibility of purchasing their holdings, the final goal of the Land League, was an idle dream. The intractable landlords would not sell, and very few of the near peasants could find one quarter of the purchase money which was necessary under the 1881 Act. Then in 1885 under the Ashbourne Land Purchase Act, the Land Commission were empowered to pay landlords the first purchase price on behalf of the tenant and to accept payment in instalments from the tenant over a period of 49 years. Around 16,000 tenants availed of these terms and the Land Commission paid £7 million to the landlords. The passing of this Act marks the  beginning of land purchase, the objective of the Land League. Cash payments were, however, a heavy strain on the State. In 1891 a new system of land stock was created and landlords were paid in stock equal in nominal amounts to the purchase money. Around 42,000 tenants in the 26 counties availed of the Act and the purchase money totalled £11 million. It would have been used more were it not for the fact that the stock stood below par and that the Boer War pushed the stock lower and put an end to the progress.
The Balfour Land Purchase Act, 1891, also set up the Congested Districts Board to develop poorer districts along the western seaboard. It was a statutory body designed to promote the interests of small farmers in defined areas of the nine western counties. The Congested Districts Board had within its care fisheries, rural industry and land purchase and it also had one significant power — to buy from landlords land which they held for themselves and had not leased to tenant farmers. The Wyndham Act, 1903, made £100 million available for land purchase. Both this Act and the later Act of 1909 enlarged the powers and income of the board and gave both the Land Commission and the Congested Districts Board the power to acquire untenanted land compulsorily. By 1923 the Congested Districts Board and the Land Commission had, between them, distributed some 750,000 acres of untenanted land. In 1923 the Congested Districts Board was merged with the Land Commission. Prior to 1923 there were three main and concurrently exercised functions of the Land Commission, fixing of rent and tenancy control, land purchase and land settlement. Prior to 1923, land purchase depended on mutual agreement between landlord and tenant. In 1923 the newly-established Irish Government at one stroke abolished the remaining landlords. In effect the Land Commission were by virtue of the Land Act, 1923, appointed landlord for or vested with the landlord's interest in the 110,000 tenants then remaining unpurchased. The landlords lost the right to control rents and they were reimbursed in land bonds  totalling £20 million. Prices were so scaled that the tenants' annuities worked out at about 65 per cent to 70 per cent of the rent they had previously been paying and the Land Commission could give further reductions if they thought it necessary.
Since 1923, then, we had many Acts — the Land Bond Act, 1925, the Land Act, 1926, the Land Act, 1927, the Land Act, 1929, the Land Act, 1931, the Land Act, 1933, the Land Bond Act, 1933, the Land Bond Act, 1934, the Land Act, 1936, the Land Act, 1939, the Land Act, 1946, the Land Act, 1950, the Land Act, 1953, the Land Act, 1954, the Land Bond Act, 1964, and the Land Act, 1965. All these played a part in shaping the Land Commission as we know it today or at least until recently. Now with no great land bank available and with such success behind them the Land Commission must be the ideal medium to make the concept of leasing popular as well as the other objectives that the Minister has mentioned, group purchase, commonage division and re-arrangement of holdings. The Land Commission were empowered to acquire land compulsorily but they did not confiscate. Their activities in this respect were set out in the statutes.
Some of the current problems which the Land Commission might very well be geared to deal with would be where we have a lack of mobility in the present land tenure system. As the Minister has pointed out, only 3 per cent changes hands each year and 80 per cent of that is by way of gift or inheritance. It is hard to see how the figure of 80 per cent can be reduced but the other figure, the 3 per cent, is indeed a very low percentage. Half of our farmers are over 55 years of age and a quarter are 65 and over. There is a need to reduce the age of succession. I said on the last occasion that older farmers should not be put out to grass indiscriminately. A proper pension scheme should be devised so that farmers could retire with dignity. Indeed, the experience of these farmers could be used by those who take over the farms. Over 50 per cent of sales on the open market go to non full time farmers. There is still  a need for a programme of rearrangement of holding between farms in the same locality and division of commonages. We must concern ourselves with the efficient use of land for agricultural development and the objective must be the optimum use of the land.
Financial institutions are in sympathy with the principle of land leasing, and in a guide to farm finance produced by Allied Irish Banks last month, there is a section on land leasing which states that the bank will also provide finance on the basis of normal commercial criteria to farmers entering long term leasing arrangements. The Minister said that what is being proposed in the Bill represents a complete turn around in the basic philosophy of landlord-tenant relations as it has been conveniently accepted here for over a century. I accept this and I can see whereas previous legislation from 1870 onwards was concerned mainly with the tenant, this Bill will now be concerned with the tenant not obtaining a prescriptive right and it will be more in sympathy with those who lease the land. It does seem somewhat disappointing to me, as a newcomer, when I have gone through the Bills from 1870 onwards and seen big volumes. However, this small Bill in a sense is the start of something new and I hope something great will come of it.
The Minister also emphasised that whilst the encouragement of leasing is an integral part of a comprehensive land reform programme, it is nevertheless, only a first step in the formulation of such a programme. This Bill will also bring us into line with continental countries, I fully support it and wish it every success.
Mr. Kelleher: I welcome the opportunity to say a few brief words on this Bill. This Bill has been very ably discussed in this House for the past four to five weeks. In fact, there is very little that one could add to the sentiments that have been expressed by Senators on both sides of the House. I congratulate the Minister on bringing this Bill before the House as it is very important. I welcome the Bill as it encourages the leasing of land and, therefore, would make more land available  for productive use. As stated by the Minister, ownership of land is not necessarily an end in itself, but we must address ourselves to the maximum production and usage that would be derived from the vast number of green acres in this country. If agriculture is to make the maximum contribution to the economy, and it can make a huge contribution, the proper utilisation of land is of prime importance. I was glad to hear the Minister point out clearly that the 1860 Acts were to be repealed as they would be unworkable in today's conditions.
I also welcome the statements the Minister made in relation to the Land Commission and the specific guarantees he gave so that there would not be any interference with land that was made available for leasing. As a result of these commitments, the way is now clear for farmers who would prefer long term leasing to come together with interested parties and work out a suitable arrangement. I have seen the model leases referred to, and they are very comprehensive and straightforward. They are basically saying that there will be an agreement between equal partners for their future advantage. The figure quoted on the availability of land for letting is that there are approximately one million acres, most of them on the 11 month system. This is the main reason why some of our land is run down and depressed. It would be in the best interest of somebody letting land to do so for a fixed number of years, whether three, five or seven, with rent reviews to cover inflation. This is the only way you can be sure that the tenant will take care of the land so that he also knows where he stands. The tenant would be in a position to spend money on developing this land as he would know he is secure for a fixed number of years. It is very important for tenants to take proper care of the land, to fence, lime and fertilise it because it is one of our greatest resources.
In relation to developing the land, I am disappointed that the subsidy on lime was removed although I am aware that it was an EEC directive and tied in basically with the super-levy and so on. I urge the Minister to reintroduce the lime subsidy  as one of the most important ingredients for land development is the proper untilisation of lime followed by fertiliser, etc. In years gone by we fell down greatly in the spreading of lime on land. At this stage of our development it is very important that we would have the maximum usage.
Mr. Kelleher: Very well. We have the largest young population in Western Europe and the introduction of this Bill should enable more land to become available for our young people. It would enable more young people to get involved in farming. However, we must sell the idea of land leasing to all interested parties, make local agencies aware of its importance and have discussions and consultations with farming organisations. The co-ops have a big part to play in so far as they are in a position to identify land that is available for leasing and thus find farmers who would be interested in leasing this land. It would encourage smaller farmers to produce more and, as a result, the co-ops would be the beneficiaries as more of the processing plants would be used for extra production. The co-ops would also be in a position to deduct the rent for this land from the monthly milk cheque.
On the other hand, there must not be incentives for farmers to give over their land, but where they are willing to transfer the land there should be some from of contributory pension scheme that would entice farmers to retire. Other EEC countries have contributory pension schemes for farmers and we should look at this area. If the farm retirement scheme was attractive enough and grants made available to the young farmers, many owners would be prepared to lease their land and, as a result, would ensure its maximum utilisation. The banks, on the other hand, have a part to play in the development of this Land Bill because they should be encouraged to make money available for young people who might be short of capital. As was recently stated in the media, we are aware of the  vast profits that the banks have been making and I would encourage them to invest in our natural resources and encourage young people to get involved in land leasing. As I said, our major assets are our young population and our land. With support from the banks and financial institutions we can work both of those assets together for the betterment of the country.
It has been stated many times during this debate that land is our greatest natural resource and that agriculture is of fundamental importance to the economy. With the introduction of this Bill, I am sure that over a period of time we will maximise on this great natural resource, that the millions of acres of land now not being fully utilised will be brought into a better state of production and give more employment. This will help in our balance of payments, in the unemployment area and in the provision of raw material for food processing. I wish the Minister well with this Bill.
Mr. Burke: I welcome the Bill and congratulate the Minister on having the initiative to bring this very important legislation to this House. I also congratulate the Minister on his courage because it is courage, more than anything else, that is needed for this Bill, in so far as it tackles a problem which has been spoken about for many years but never acted upon. The utmost co-operation should be forthcoming from everybody involved and every encouragement should be given by the various agencies involved or who hope to be involved in this Land Bill in the future.
Every aspect of the land problem is sensitive. Our history shows us that we spent most of our years battling over land. We have had many wars, including a land war. It is a very sensitive area and one which is particularly dear to the hearts of every Irish landowner. Any measure which in any way encroaches on this area will make very slow progress and will be scrutinised very carefully. Anybody who believes that this Bill will revolutionise our whole land problem quickly will be disappointed. For this  reason, patience will have to be paramount in everybody's minds with regard to this land question.
It is intended that land mobility would be dealt with in the Bill. There have been many factors contributing to a lack of mobility in the Irish land question over the years. One which is very obvious to most people, and particularly to the people in the west, is late inheritance. Twenty-five per cent of our land is in the hands of people who are over 65 years of age. Therein is one of the major problems which have to be tackled.
I should like at this point to welcome the Government's decision to extend for another year at least, the stamp duty exemption which it initiated some years back. It is welcome legislation and it had the desired effects in so far as it began to show in some small way that land could be made mobile if the proper environment was created for it. We are happy that it has been extended for another year and hope that where older people are prepared to hand over land to younger people in the family or outside it this provision will continue.
In the course of the Minister's address to the Seanad he said he was considering the matter of regulating and controlling the sale of land which comes on the open market. Many comments have been made in the House on this aspect. That has come in association with the whole concept of land leasing and there is no doubt that there is confusion abroad in relation to the association between these two. I welcome the Minister's later statement guaranteeing that any land which would become available for leasing would not be acquired at a later date by the Land Commission. That is a verbal guarantee given by the Minister and I do not doubt his sincerity in this, but I would have to say that in order to satisfy the many people who have land to lease it should be written into the Bill so that there is no possibility that the Land Commission could, at a later date, acquire that land.
Senator Mullooly stated that a register of all land being made available for leasing should be drawn up. I would have a degree of suspicion that that register  could be used at a later date if it was felt desirable to do so. I would not like to see any register being kept of land being made available for leasing. Certainly if it was in the hands of the Land Commission I would be suspicious of it. I would never be satisfied with the Land Commission's involvement in the land leasing concept. A degree of suspicion would remain dormant in the minds of the people who would have land to lease. I would like to see the Land Commission as it is now constituted abolished. I call for it to be abolished and abolished quickly if this land leasing idea is to take root at all.
The very idea that set up the Land Act of 1881, referred to by Senator Fitzsimons, was that we would have, among other things, free sale. If we can guarantee this, we will be going a long way to allaying the fears that have been expressed in recent times as a result of the publication of the Bill.
It has been stated by many Senators that the Land Commission have served us well. This may be so for people who have benefited from land acquisition. I should like to point out, however, that in spite of the hundreds of thousands of acres that the Land Commission have had at their disposal in the last 20 years, the majority of farmers who benefited only got an addition of four acres. If the whole idea and concept of the Land Commission was to alleviate congestion and in the past 20 years all they have contributed is four acres per unit, they have failed dismally to make any worthwhile contribution to the aim for which they were originally set up. It is reliably estimated that the actual cost of dividing an acre of land in 1983 was £400. That is a luxury we cannot allow to continue. For that reason I can justifiably call for the abolition of the Land Commission at a time of scarce resources. Such a wasteful use of scarce financial resources in the area of agriculture or any other area cannot be tolerated and allowed to continue for the future.
People may criticise me and say: “what would you do with the personnel and how would you organise the land that has become available?” I believe we have a very important structure already available  in ACOT. These are the people who are involved with farm management and farm improvements and whole schemes and projects by which farmers, large and small, can increase their productivity. The details that they have in their possession are far greater and more important to actual productivity and increased productivity than those available to the personnel of the Land Commission. They were primarily people who divided land. Many of the allocations that were made were made to people who, with hindsight it can be truly said, have benefited very little by it and have made very bad use of it. While the Land Commission tried to provide for the wishes of many people, it did not provide for the needs of the people. That is one of the major faults of the Land Commission that we can see so glaringly today throughout the countryside. They tried to appease people's wishes rather than their actual needs.
Another fault is that in trying to alleviate congestion they created a far greater problem which the Minister, coming from the west of Ireland, is aware of. Fragmentation is one of the greatest problems we have in the west of Ireland. When the Land Commission acquired a large estate they apportioned it out in small sections to adjoining farmers within a radius of one to three miles. Concerning the very problem that the Minister is trying to solve today in relation to land leasing — trying to get a unified structure of farm holding by asking people to exchange pieces of land in adjoining holdings and to amalgamate the holdings in general — the Land Commission have over the years set out to do the very opposite in so far as they fragmented holdings.
Senator Fitzsimons a few moments ago mentioned design. He was talking about houses that were built by the Land Commission in years gone by on these holdings. The whole concept of design was foreign to the Land Commission. Many of you in your own areas will remember very beautiful estates that were acquired by the Land Commission, held for years and broken up. Associated with such an estate would have been one of the old country houses, few of which remain in  this country today unfortunately. The Land Commission were responsible for the destruction of many of these old houses. I can think of one within a few miles of my home. It was in a beautiful setting on the banks of the Shannon. The Land Commission acquired the estate, kept it for about five years, let it and then proceeded to put barbed wire within six or eight feet of the carriageway to the front door. They cut it off from the views and destroyed the whole aspect of the house and its environment. I believe they can be faulted for destroying some of our heritage. I am afraid that is the view I have of the Land Commission and it would take a lot for me to change that view of them today. Few people have benefited from acquisition of the land.
Another aspect of the Land Commission's failure and disappointment to many was their system of payment for land they acquired. The land bond system was nothing short of a State rip-off. The land bonds today——
Mr. Burke: It is an integral part of it, I believe. If the Land Commission are to have a part in the land leasing scheme it will be more difficult. The case I am making is that I believe the Land Commission have been a failure. I would not like to see them getting involved in another system which has been given thought and encouragement and making it a cause of ridicule at a later date. That is the context in which I am speaking.
Mr. Burke: I would hope that when personnel are needed for the implementation of this scheme we would use the ACOT system that is there and if necessary incorporate the personnel within that system for any part they might have to play in mapping the lands apportioned and the lands that might be rented and  drawing up the agreements that might be necessary for the leasing concept.
The whole leasing concept is to be commended and I hope it will increase the farm size and the amount of land that people who are prepared to work it have at their disposal. The land leasing system that we have at present and have had down through the years, the 11 months system, has failed dismally. It is a wasteful use of land in so far as it is confined to a system of agriculture such as grazing, particularly in the west of Ireland, for an 11 months period, and perhaps in the more important tillage parts it was for corn or the production of a crop like that. The person who rented the land for the 11 months got what he could out of it for that 11 months and knew that he would be displaced at the end of that 11 months. It was wasteful and could never contribute to increased production in agriculture.
It is important to say at this stage that, while the Land Commission had and still have vast resources of land in their possession they never saw fit to pilot a scheme for long-term leasing. I would ask the Minister to see that, if there is a substantial area of land in any particular area, we should use that as a pilot scheme. The Land Commission should rent it on a long-term basis, and do one pilot project to show their commitment to long-term leasing. It would encourage people away from the 11 months system also.
Senator Fitzsimons mentioned the many advertisements we see. I have a copy of one here. Last April the Land Commission proceeded to offer, on the 11-months system, vast areas of land in County Galway. That is regrettable when we are trying to promote more long term leasing of land. They should show the way.
Many people have said that we should encourage long term leasing by incentive. While not disagreeing with it I would discourage the ideal that we should have to prop up a new system by incentive. I am glad the Minister has not included any direct incentives in the Bill. Time will judge the efficiency and the effectiveness of this Bill, and I would hate to see it  being propped up artifically by incentives such as remuneration to people to encourage them to lease. There is another way of doing it which I will come to later. I would rather see an encouragement by way of incentive to increase production to the people who lease the land rather than an incentive to get the land from the original owners.
The incentives that have been brought forward by previous Governments have failed. I speak in particular of the incentive in the farm retirement scheme. If we are to have a revamped farm retirement scheme I believe it will have to be in association with and in consultation with the Department of Social Welfare and not to have one Department offering an encouragement and another Department penalising people who have an income from leasing land on a long term basis. All too often today people deriving an income from farming or renting of land are precluded from getting a basic entitlement like the old age pension. At the end of their days, when they are not producing from the land, to notionally assess an income from it, over and above the actual rent, is a penalty that cannot be tolerated in the new Bill.
I welcome the co-operation that the Minister has been promised from the co-operative movement and I would like to know if they have given a commitment, other than their goodwill in promoting it. It would be unfortunate if the co-operative movement were to become competitors for land under this scheme. If they were to do the initial leasing and let it out at a subsidised rate to their suppliers or their members that would be a good thing.
The people who are most capable of increased production at present are the small farmers involved in dairying. I would like to welcome, indeed, the Government's breakdown in the quota system that has been announced recently. It has direct relevance to the particular people who would benefit by increased production. The small producers of milk would benefit most, and seeing that the majority of the producers in the country are small producers I welcome the Minister's announcement in the recent past  of the breakdown and allocation of the quota system for small producers as it will affect the majority of people who will avail, I hope, through the co-operatives perhaps, of increased land area to come up to the level of production that we would——
Mr. Burke: I would welcome also a commitment from the financial institutions to supporting the whole area of land leasing, particularly the support of Allied Irish Banks mentioned by Senator Fitzsimons. If there is so much assistance and encouragement and incentives available through those institutions the probability is that we will be back again to the situation in which we are as regards the 11-months system where many small farmers will be in great competition for leasing. The whole idea of leasing suits the small farmer in so far as there is a very small capital contribution in comparison with what he would have to lay out if he was purchasing the land. If financial institutions are going to get involved again and make money readily available for land leasing without a very careful scrutiny as to the potential productivity at the end of it many farmers will again be misled by these institutions. I would have to fault some of these banks for the way in which, having given out money liberally in the past, they now apply very strict rules and have commandeered many holdings in recent times because of their own leniency in the beginning. Now they are turning the screws and have been penalising people who did not, for one reason or another, come up to the expected level of production.
I wish the Minister every success and encouragement with this Bill. I believe it will take courage and time for it to succeed. The people who will benefit most are the smaller people whom you have set out to help. All of us will eventually benefit from this Bill in so far as we will have increased national production. If the work is carried out in the national interest overall I believe it will be a very important piece of legislation that will set  the headlines for many further improvements. I believe it is only one of many improvements that are to come. It is a major step forward and I wish it every success under the Minister's guidance.
Minister of State at the Department of Agriculture (Mr. Connaughton): First of all, I want to say a sincere thank you and pay tribute to the tremendous amount of contributions that were made on this Bill over the last three or four weeks. If my tally is right we had not too far away from 20 contributions, and that is normal for matters relating to land. We had a very wide-ranging discussion, most of the matters raised directly related and some not too directly related to the Bill. We got a great insight into how complex this whole question can really be.
There are a few points I would like to state at the outset. From the very beginning from all sides of the House it appears to me that the idea of what I am trying to get at has not actually got across to some Senators yet. What this Bill proposes to do is to change the legislation by removing certain inhibitions that were contained in various Land Acts back in the late 1800s which will have the effect of my being able to assure, in a categorical way, any farm owner who decides to lease his land to anybody else that in law he will get that land back on the expiry of the lease. This runs contrary and counter to the normal landlord and tenant legislation in the sense that over the years there has been built into it on behalf of the tenant certain mechanisms by which in certain circumstances a tenant could have certain rights or could develop certain rights. In that sense this Bill certainly changes course dramatically. For the last 100 years and particularly in the last 50 years any farmer who would have any idea at all that on the expiry of the lease of his particular land the tenant might have certain rights — which would mean that he either had an option on it or could not actually be put off it — would not lease land. This had the obvious effect that no land was so leased. That is the important part of this particular Bill.
 My view of it, and I agree entirely with the Senators who expressed this view, is that there is a certain degree of suspicion all over Ireland about matters relating to this Bill and to other such Bills. I want to assure the House that what I and the Government are getting at is that I want to create an environment wherein this normal farming practice which has been practised throughout Europe — this is the only country in which we do not have long-term leasing — will operate here. What we want to do is to make sure that we have a better land usage and that in certain circumstances it is not necessary to own land to actually make good use of it and make a proper livelihood for the farmer involved. That is the top priority of the Bill itself. I have been at pains to express this opinion in parish halls all over Ireland in the past 18 months, that what I want to do is to create an environment in which we will take all the contract issues that are involved in land and channel them together in such a way that on several fronts we will get movement. I do not intend to say that it is going to be an easy option. As far as this Bill is concerned, and I agree with most Senators that it is an important step, without it the concept of long-term land leasing would never get off the ground.
I would also have to say that there are certain other aspects of land leasing and its connection with other sectors — I am talking about social welfare and all those other aspects — that will have to be looked at. In fact I have had considerable success in impressing on people in the last number of months, which I will outline very shortly to you, the seriousness we attach to this particular problem. While we had the 1978 inter-departmental report which suggested that land leasing should be encouraged and the National Planning Board statement that long-term land leasing was obviously an important facet of Irish agriculture, the problem was that until quite recently we had no concrete action on it.
I think it was Senator Fitzsimons who mentioned that the last Land Act that we introduced in either House was in 1965. That is nearly 20 years ago. As you are all well aware, times change dramatically.  It is only reasonable to assume that it is either time or past time that major changes of emphasis were made in this country vis-á-vis legislation relating to our land tenure system.
There are a number of things I would like to put on the record of the House. First of all, in so far as this Bill is concerned, the Land Commission or anybody else will not pressurise any farmer to lease his land if he does not want to do it. That might seem a very elementary statement. It is something which I am constantly being asked around the country: Will there be any pressure? This is entirely voluntary. Indeed I might add that in my view the only way a scheme can ever get off the ground in this country is to make it as attractive as possible so as to attract people into the scheme and not drive them in. There is no compulsion whatever in this or any other scheme I will be talking about. It is very important to put this on the record of the House.
As I said, we will be giving a categorical assurance to every landowner that if he or she leases land whatever agreement will be made with the person who rents the land, the tenant, will stand. The law when it will be passed by both Houses, will ensure that is the way it will work out in practice, and this should remove any anxiety that any person has in the length and breadth of this country. If I did not do anything else except get that message across this afternoon I would consider it a day's work well done.
There are many aspects of leasing that I will quickly go through this evening. First of all, we are dealing with the legislation here and as I said I have outlined exactly what I am getting at. There are minor parts of this Bill that on Committee Stage I will go through. They talk about immunity to this and some Senators have raised certain questions about that. Those are only just administrative problems and I will explain them in detail when we get to Committee Stage.
However, a number of factors emerged in the year 1983 that in my view have greatly enhanced the future likelihood of leasing becoming a viable farming proposition. The legislation is number one: number two — and for many years we  were very short of this — we did have what we call a master lease. It was one of the problems that any farmer or tenant who wanted to become involved in leasing often found it very difficult to get a solicitor anywhere actually to draw up a lease that would cover most eventualities. However, through the good offices of a number of agencies we had two such master leases issued in 1983. For all leases and all agreements between a farmer and a tenant there now is a master lease and in my view that is a great step forward, and I congratulate the people concerned for making those available.
Senator Burke mentioned an important point, that the Irish Land Commission should give a guarantee to every farm owner in this country that if they leased their land the Land Commission would not acquire it afterwards because it was so leased. That is an important item. Despite the fact that I have mentioned this time and time again in the last 12 months, people still keep coming back to me and ask, can we be sure? We can be so sure that I am prepared in writing on the lease itself between the farmer and the tenant to state clearly that the Land Commission will not intervene or get involved in that particular land because it has been so leased. I cannot go any further than that. For all Senators, it is important if they believe in the promotion of long-term leasing, that that assurance no matter who is in Government should be given. I would agree with Senator Burke that if it got legs, as we say, that that particular point of view might not prevail, we would then have problems.
The third thing that has happened during the year is that I have made available at the local area offices of the Land Commission around the country at least two people in every area office who have done some in-service training here in Dublin with the intention of becoming wholly involved in the promotion of land leasing in their respective areas.
I think land leasing is for all of Ireland. It is not enough to say that it might solve the problems of some small farmers. Here is a concept for big and small farmers in the good and bad farming areas. It  is as relevant to County Kilkenny as it is to County Mayo or vice versa. It is something that many people are finding it hard to grapple with — if you do not own the land how would you believe this concept could actually get off the ground? As Senator Mullooly mentioned in what I would consider a good contribution on the last occasion, we have to divide the concept of land ownership from management. In so far as that is concerned at a leasing level what one has to look for is a young farmer or indeed any farmer who would believe that by renting land on a medium to long-term lease he or she would be able to make a better profit from the farming enterprise. That is the bottom line in farming: if you do not make money out of it and if you are not seem to make money out of it then there is no point in being in it.
I speak entirely from a farming point of view. If this concept is to get off the ground, and I am absolutely certain at this stage that it will get off the ground, it will be seen in the light that when you compare a situation in which a farmer would have to buy land with leasing land over a lifetime, you find that at the end of the day it would be proven that he would be better off to lease land in most circumstances. That is when leasing will become a very important concept.
Another important aspect of leasing has developed in the last six months and a number of Senators have referred to it. That is the involvement of the co-operative societies in this country. I would like to pay a tribute to the ICOS for their interest in the whole idea of land leasing. We were all very much heartened by the response at the land leasing stand of the ICOS at the Spring Show this year. Many hundreds of people come to that stand to talk about land leasing. They wanted more data on it and, most important of all, they wanted to know whom to contact about it when they went home. That is why I think there is a role for the Land Commission officials locally together with the co-ops and everybody else that is involved, to promote the idea of leasing. I would readily agree that it is  important that we be able to get across the idea that there is help and information locally available to get this thing off the ground.
The co-ops are in an ideal position. It may be said that they do not cover all of the country but they certainly cover a lot of it. The idea behind the co-op involvement is a good one. First of all, it has the shareholder system whereby people come together to build a mart or creamery or whatever it might be. It is in their interest as a group to ensure that they have as high as possible a volume of input of milk or cattle or sheep to ensure that their mart is working efficiently. Obviously, if surrounding one of those co-ops there are large tracts of land that have been under-utilised it is clear that they are not getting the supplies of cattle, sheep and milk they should be getting. It is reasonable to assume that some of the people who own that land are also shareholders in the co-op. What I have suggested and what the co-op people themselves have been looking at is the setting up of what might be called a matchmaker system, where the co-op acts as the middle man and is able to get potential lessors and lessees together. We have reason to believe in the last few months even prior to this legislation that this idea is working. There are a number of such leases signed in this country pending this legislation going through the House. That is a step in the right direction.
There are many other organisations involved in land leasing, or will be, that will have a profound effect on the direction that it will take in the next few years. One of those has been mentioned by a number of Senators. The involvement of solicitors and auctioneers is of great importance, particularly auctioneers. Many Members of the House may be auctioneers themselves. It is a time-worn pattern that any person who has land to lease in this country usually makes a bee-line for his local auctioneer. I have had the pleasure of meeting the Irish Auctioneers' Association. I got unqualified support on that occasion for this concept. I want to put in on the record that in so far as their involvement is concerned  I would be very much behind the idea of auctioneers being involved at every level. From my point of view, I do not mind who is involved in land leasing so long as I see a greater utilisation of our land under way. Obviously we have to be very practical. The auctioneers are a very important body of people. May I refer for a moment to the fact that this particular auctioneers' association saw fit to draw up their own master lease themselves, for which I thank them? They asked for our views on it and I understand we have been in contact with them.
The farming organisations have a profound affect. I would like to record my appreciation for the work that they have been doing. I have met them on numerous occasions in the last 12 months. Their help and guidance in this matter and their dedication to it through their members down at the parish level where it will all happen is of paramount importance. I am delighted with their progress to date. They, in fact, more than most, will shape the future of land leasing in this country.
I want to say a word about the banking institutions. They were mentioned on a number of occasions in so far as their activities relate to land leasing. I met the Banks Standing Committee some months ago and I must say that it was a very positive meeting, a meeting which expressed the opinion that the banks and the ACC would be more than willing to be involved at a commercial level in the provision of loans for medium and long-term leasing. To digress for a moment to clarify what I mean about actual leasing, there was an idea abroad some years ago that anything less than a 12-year lease was really of no use to any farmer. Because of the fact of the concept of 12 years and the length of time that it happens to be, people began to get wary about it. Twelve years is a long time. I often give the example that a farmer who is 60 years of age now and who leases land on a 12-year lease will naturally be 72 and quite elderly when he gets his land back. That had a dampening effect on land leasing. My view is that we should elect for a shorter term, for example, three, five or seven years. Many Senators have said to me: why do you not have a  statutory limit in your Bill that will indicate the number of years? That is something you could not do for obvious reasons. There are certain tillage areas where a three-year cycle suits best. There are other areas where a six-or seven-year cycle would suit. The ultimate in length in leasing is 12 or 15 years, and I have no doubt that an occasion will arise when we will have leases of that kind when people get used to the idea. In the meantime I prefer to talk about short- to medium-term leasing. We have one-and-a-quarter million acres of land on the 11-months system that many Senators talked very critically about in the last few days and if we could get that shifted and transferred from that system to a medium-term letting, even for three, four or five years, then we would be well on the road to getting the type of result we would like to get in this Bill.
I am confident that the banking institutions will, under the normal criteria for lending, back this enterprise. I will not go into the ins and outs of it this afternoon but I think there is a place there for the institutions and I believe from the meeting I had with them that this will become a fact of life.
There was talks about incentives. Indeed I agree with the Senator who expressed the opinion that it was necessary to have certain incentives to run with this Bill. I would have to say first of all that I could not agree with the Senators who said that they welcomed the Bill but because incentives are not included they could not agree with it. It was never intended that incentives as such would be written into the Bill. That is a different matter, but I would agree with the Senators who voiced the criticism that without incentives leasing might not become as popular a concept as we would like. Having that in mind, there were a number of things that I have already attended to and it would be no harm to put them on the record of the House.
We have negotiated successfully with the Department of Social Welfare on a very important, even if minor, issue. The effect is simply that where a person on reaching old age pension age leased his land on the 11-months system he would  heretofore be in a more favourable position to get a higher old age pension than if the same man had his land long-term leased. I have equalised the position now. In other words, I can give a guarantee to every prospective old-age pensioner in this country that he is at no disadvantage because he is long-term leasing his land now rather than leasing on the 11-months system. That is an important step forward.
There is another very important step forward, and it concerns the whole question of stock relief provision. As the House will be aware, up to the last budget we had a position in this country where the facility of stock relief was extended in taxation to farmers who increased their stock. There was a certain problem in the budget, but as the House will be aware that facility has now been restored. This is in the normal farming practice. But I am now glad to be able to say that in the case of bona fide leases entered into between the lessor and the lessee, and approved by the Land Commission, the tenant will now be entitled to stock relief. That is a very important aspect of the matter and I would go so far as to say that if that provision were not there it would be very difficult to sell long-term leasing. That is an important aspect of the case and it is something we should not overlook.
There are many other aspects of this whole question of long-term leasing, but suffice it to say in the few minutes I have at my disposal that what we must do is, first of all, through whatever methods possible, to get land into the hands of persons who are able to make a sustainable living out of the land in question. This will be done in my view on about five fronts, one of which is land leasing. The second one, and a very important one, is the question of the group purchase scheme. This is a scheme that is doing extremely well. I was delighted with the results of the last three months' figures. These were substantially up on the previous three months. The concept here is very simple, that where a particular farmer, big or small for that matter, is unable, because of financial restraints,  to buy a particular farm, in conjunction with two or three others or as many others as are needed, they will come together to purchase this particular land. The Land Commission will give every assistance in mapping and the division of the land in proportion to what a man is able to pay and we can look back with great satisfaction on some sales where estates were divided and two months after the sale, the farmers with the land divided amongst them were already engaged in farming that land. In my view that is a much quicker, more straightforward system than the Land Commission actually acquiring land and paying land bonds for it and dividing it four or five years later. It is something I am very interested in and I feel there is a great future for it.
Reference was made a few moments ago to the stamp duty exemption. This has proven to be a great asset in getting land mobility between family members, from father or mother to daughter or son as the case may be. What this basically means is that the Government pay the stamp duty on the transfer of the farm, provided that it is tied up with a certain educational standard. I think nobody will quibble when we demand that standard. It is one of the reasons why the 100-hours EEC courses are filled to capacity at the moment with young people whose parents see that this is the right thing to do. On transfer of the farm the stamp duty is paid. That is an important fact in inheritance. We need a system whereby we can get quicker inheritance so that the people who are highly trained and who have youth on their side will be given the chance to start in farming before they are too old or before their ambition is gone.
We had two trials of this in this country as you are well aware. We had two retirement pension schemes that did not work, and these were sponsored by the EEC. Very recently we got a body blow in this country when the EEC Ministers decided Community-wide that they would not actually sponsor or initiate another retirement pension scheme because they said after all that in seven or eight of the nine countries it did not work. They have now come up with a suggestion that my  Department are currently looking at the question of an establishment or installation grant whereby a young person entering farming would be given certain aids and a monetary return for certain things he would do. I must say that I like the idea, and a group of senior civil servants with whom I have been meeting in the last 12 or 18 months on matters relating to the land question are looking at the various aspects of this scheme. It is one in which a lot of land will change hands a lot quicker than under the conventional type of retirement scheme, and that is something we will have to look after.
There are many other points that have been raised on this Bill. I thought it was a very good discussion on a very emotive subject and one on which everybody has a view. But I think it is significant that we in this House have initiated a new direction for a more meaningful land policy for this country. You might describe it as a small step, but when it is built around with other aspects of policy that I have been speaking about I think at the end of the day we will get the type of policy that will mean that almost every acre of land that was heretofore under-utilised will be in production. Unless we arrive at that stage we are indulging in luxury we cannot afford. I thank the House and the  Senators for their attention. There are some important smaller points that I am sure will come up on Committee Stage and I will try to answer them then.
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