The delivery of the £23 million headage payments to farmers in disadvantaged areas and the reduction in the tax rates drew a guarded welcome for the Budget from the State's largest farm organisation, the Irish Farmers' Association, last night.
The issue of headage payments, which come from national rather than EU funding, had become a difficult issue between farmers and the Government in recent weeks.
But the delivery of the headage payments in the Budget brings stability back into the relationship between the farm organisations and the Department of Agriculture.
The IFA president, Mr John Donnelly, said the Budget was "broadly positive towards rural Ireland as regards the extra payments for headage". The Minister for Agriculture, Mr Walsh described the Budget as a good one for farmers and said the provision of the additional £23 million will bring total headage allocation to £111 million for 1998.
The provision of £23 million will be adequate to meet the Department's entire requirements in 1988 and will correct the situation which arose from the front loading of payments under the current round of Structural Funds.
He said young farmers will benefit from the allocation of £3.5 million under the Installation Aid Scheme to help them set up in business and farmers will also benefit from important changes in the tax regime.
But the young farmers' organisation, Macra na Feirme, said the Government's decision not to lift the suspension on the scheme, was an affront to young farmers.
"Young people in this country have little faith in their public representatives and today's decision which represents a blatant U-turn in the Government's pre-election promise will serve to provide more ammunition to doubters," said the organisation's president, Mr Tommy McGuire.
He said the provision of the £3.5 million to cover existing applications was no more than the Government fulfilling its legal obligations to these people. The Irish Creamery Milk Suppliers' Association said Mr McCreevy had paid the usual homage to the importance of agriculture in the Budget but he had the ignored the requirements for on-farm investment and the pressing need for farm families on low incomes.
The ICMSA president, Mr Frank Allen, said the provision of funding for headage was solely to restore cuts made in the Book of Estimates and the money for Installation Aid was merely to meet existing requirements and did not meet the needs of young farmers who needed the scheme fully restored.
"While the general reductions in tax will help farmers, the specific measures for agriculture are either token gestures or are undoing cuts already made by this Government," he said.
The Irish Cattlemen and Stockowners' Association, which represents drystock farmers, welcomed the provision of the headage payments because they apply to 75 per cent of land in the State. But its national chairman, Mr Albert Thompson, said he was disappointed that the Department did not go for the full restoration of the Young Farmers Installation Grant Scheme.
He said young drystock farmers face a bleak future because of the low price for their produce and the unfair system for distribution of the EU beef supports.
The IFA was also critical of the level of installation aid provision and said it was totally inadequate and showed a lack of Government confidence in young farmers. There was a welcome too for the announcement that a pilot scheme involving Rural Renewal will flow from the Budget. All the farm organisations had been asking that rural Ireland be treated the same way as urban Ireland and tax breaks given for development.
The Minister said he will be drawing up a pilot scheme of reliefs to apply in parts of the upper Shannon region to bring in such a scheme and details of this will be revealed in the Finance Bill. A number of groups involved in rural development have put forward proposals to the Department for such a scheme which will have to be approved by the EU.