Archive for the ‘Irish Farmers Journal’ Category

Apple Farm looks for potential to increase juice capabilities

Tuesday, December 21st, 2010

Irish Farmers Journal

By Peter Young

Apple Farm looks for potential to increase juice capabilities

Five apples out of every 100 eaten in this country are Irish. Yes, just five. I had to ask Con Traas to repeat that figure when he first told me. I had always assumed that we grew a lot more apples than that in Ireland.

I know some of the reason is down to seasonality but, still, it seems very, very low. The figure is even more startling when put in context that the retail value of apples sold in Ireland is around €121m.

Simple maths put the value of Irish apples at just €6m retail. There must be potential to increase this.

Con Traas of the Apple Farm believes there is. A member of the Irish Apple Growers Association, he told me there are about 40 commercial apple growers in the country.

About half of these are small-scale with just two to five acres of orchards. Con has increased the orchards on his farm to 32 acres and plans to increase this further.

Initially, the apples were sold locally, with a lot sold through their farm shop.

To add value, they started to look into processing apples into juice in 1995 and got a LEADER grant for about £10,000.

”It was a lot of money at the time,” remembered Con.

Investment has continued with new cold stores put in to store the apples for longer periods on the farm, extending the season that customers can get his Irish apples.

The latest in investment is a new processing room for juicing apples.

Focused on increasing efficiency and cutting production costs, Con is planning to spend €300,000 on the latest project.

He was approved for a 35% grant under the Department of Agriculture scheme for processing of agricultural products.

The business now employs 10 people full-time, with up to 28 local people working during the busy picking season.


Dealing with the CPO process

Saturday, August 21st, 2010

Irish Farmers Journal

By Richard J Rea

Up until recently, it was a foregone conclusion that the county council got their own way with the issuing of a CPO.

However, the lock-out of lands by landowners in 2000/2001 by the IFA resulted in a realisation, that landowners had rights and that legislation introduced in the time of the landlords was not a suitable procedure to use in a modern age. Arising from this background and the development of partnership talks with the Government, the December 2001 agreement between IFA/DOE/NRA arose. However, there was no change in the CPO legislation.

Prior to this agreement, the IFA recommended valuers who became involved in the CPO process, had been challenging the proposed designs to agree accommodation works which would relate to access, drainage, relocation of farm buildings and other design issues.

However, around this time, a new method of constructing roads was being developed known as ‘Design and Build’. This involved the local authority selecting up to five or six contractors and these selected contractors submited a price to design and build the road. The advantage to the State of this procedure is that the price is fixed and will generally be completed within time.

The disadvantage from the householders and property-owners’ point of view is that the final product could differ substantially from what was in the preliminary design, and due to the manner in which some roads are built, a more accurate description would be ‘Build and Design’.

Compulsory purchase orders have recently been issued on:

•N20 Cork to Patrickswell

N22 Adare bypass

N2 Slane bypass (part of Dublin to Derry route)

When a CPO is issued, it is generally accompanied (if it is a large project) with an Environmental Impact Statement – known as an EIS.

The information to be included in the EIS is stipulated in Article 3 the EIA Directive 85/337/EEC as amended by 97/11/EC and 2003/35/EC/EEC which states:

‘The information to be provided by the developer in accordance with paragraph one shall include at least:

—A description of the project comprising information on the site,

Design and size of project,

— A description of the measures envisaged in order to avoid, reduce

And, if possible, remedy significant adverse effects,

The data required to identify and assess the main effects which the project is likely to have on the environment,

An outline of the main alternatives studied by the developer and an

Indication of the main reasons for his choice, taking into account the environmental effects,

A non-technical summary of the information mentioned in the previous indents.

The EIS will contain a ‘draft design’ of the road.

Weakness

The weakness of these ‘draft designs’ is exactly that – they are draft designs and it is the contractor who will decide what is finally built, with little control from the local authority and no control by the person whose land is being acquired.

The EU Commission has queried the ‘draft design’ as it believes that this is contrary to ‘a description of the project comprising information on the site, design and size of the project, as it is not possible to supply information on the design when that has not yet been designed.

Affected property owners will be told at oral hearings that the road will be designed to NRA standards and subject to road audits at various stages.

An example of NRA poor design standards can be seen on local roads where there are embankments and minimum lengths of crash barriers. Such examples can be seen on new roads, where there are embankments leading to bridges over a motorway.

Such designs are, I consider, highly dangerous and likely to guarantee serious injury or a fatality in various parts of the country, sooner rather than later.

By the time the CPO is issued, the road location has been settled on. Underpasses and over-bridges have also been largely determined.

Property owners are entitled to recover their costs to protect their position. However, costs are legally only due from date of notice to treat, which is generally in the future – up to 18 months after the road is confirmed by An Bord Pleanála.

Thus, property owners need to have engaged their agricultural consultant/valuer well in advance of the issue of the CPO.

I consider the system is flawed in that the position pre-issue of CPO is shrouded in semi-secrecy, with no encouragement of landowners to engage competent CPO consultants by the acquiring authority.

The Environmental Impact Assessment (EIA) is meant to be a process where the affected property owners are consulted over a number of years in the process required to prepare the environmental impact statement.

This is to avoid elementary mistakes, such as drains running uphill, being part of the design.

It is beyond comprehension as to how a meaningful consultation can occur when a number of people meet a property owner to consult with him in relation to draft design. This often happens in circumstances where the property owner is not encouraged to get professional advice and where it is not unusual to remove the draft design from the property owner after the alleged consultation.

I wish to point out that certain county councils and their designers have a positive pro-active approach, but, regretfully, a large number still have an 18th century attitude.

There is a major advantage of the local authority having a pro-active approach as this results in identifying problems at an early stage and an improved design or decision to resolve the problem being made.

An example of this that I have seen on many occasions involves private dwellings – where roads are put very close to a house, when the correct decision would be to remove the house or design the road differently.

Where houses are removed, there is no guarantee that the local authority will give planning permission for a new house on the same property. I am aware of one location where the local authority refused planning permission, despite the same local authority having issued a CPO on the private dwelling.

Consultation without real information is a total waste of time. It is a joke.

Thus, you can see that where a CPO is currently in the process of being issued on a property, payment could take up to five or six years.

It is clear from this long, drawn out process, that the property owners should retain consultant valuers who are well experienced to represent them and defend their position. The only time after the issue of the CPO. that they may be able to influence the design of the scheme will be in the oral hearing.

REPS – the environmental benefits

Saturday, August 8th, 2009

Irish Farmers Journal

By Tom Dawson, John Bligh, James Carton and Ian Kenny

REPS was introduced in 1994, and over the past 15 years, 60,000 Irish farmers have participated in the scheme. Over these years, the environmental improvements that have occurred in the Irish landscape are plain to be seen. REPS obliges participants to exceed National and EU environmental regulations.

In this article, we attempt to quantify the economic benefit of some of these environmental improvements. The Irish landscape, which for the most part is a farm landscape, is generally appreciated by us all, from the farming community to rural and urban dwellers and foreign visitors alike. The preservation of the existing environment and its enhancement through planting hedges, trees and creating habitats, can be attributed in the main to REPS. It is possible to put a value on this enhancement.

A 2004 study*, entitled ‘Putting a Value on the Farm Landscape’, was written by Tomás O’Leary and Art McCormack of the Faculty of Agri-food and Environment, UCD. They carried out a study on 44 farms nationally in order to assess the landscape benefits of REPS.

Twenty seven of these farms were in REPS, while the remainder were similar farms but not REPS participants. It then estimated the resulting economic value of these improvements, based on the general public’s preference for improved landscape and appearance when compared to the non-REPS farms.

The following discussion relies heavily on the results of this study, which was commissioned by the Department of Agriculture and Food.

REPS versus non-REPS farms

REPS farms achieved higher results in terms of positive landscape assessment compared to the non-REPS farms in the study, clearly indicating the effectiveness of the scheme in terms of landscape quality. Figure 1 shows that farms in REPS were mostly at the upper end of the so called Landscape Aesthetic Quality Score, while non-REPS farms were mainly at the lower end.

Valuation of Maintained or Improved Landscape

Aside from financial benefits to participants in the scheme, REPS offers a range of environmental benefits to society. To date, REPS have been the only economic policy incentive for farmers to enhance the landscape contribution of their holdings. These benefits include improved water quality, the visual value of the rural landscape, wildlife preservation and the preservation of habitats and features of historical interest.

The study used a standard evaluation method known as the ‘willingness to pay principle’ (WTP) to measure the value put on a variety of landscape characteristics attributable to REPS by a sample group of urban and rural dwellers. These characteristics were identified by the authors in conjunction with landscape experts as being key features of the REPS ideal.

Landscape benefits

Total landscape benefits arising from REPS exceeded €150m in 2003. Assessing whether REPS offers value for money also requires an examination of the costs associated with it.

In 2003, total expenditure on REPS, adding together payments under REPS1 and REPS2 and administration and inspection costs, was approximately €195m. Landscape benefits alone, were worth 78% of the total cost of REPS in 2003.

Biodiversity

With the introduction of REPS3 and subsequently REPS4, biodiversity in the landscape became a more important feature of the scheme. The basic 11 measures of the scheme lead to greater landscape improvements, with enhanced biodiversity.

These biodiversity options shown below are implemented by participants in the scheme. Figures are not available for the options selected in REPS4. However, the trends evident from REPS3 can be extrapolated to REPS4. These biodiversity options are ‘additional’, in the sense that they exceed basic cross-compliance obligations and could well be lost.

High value

In general, the study suggests that the public attaches a high value to landscape improvement measures under REP schemes. However, landscape improvement is not the only environmental benefit resulting from REPS.

Improved quality of drinking water, biodiversity, enhanced recreational opportunities, as well as reduced carbon levels also need to be measured. While this has not yet been done, and is beyond the scope of the current study, it is reasonable to assume that when added to the landscape benefits shown above, the environmental benefits of the REPS programme comfortably exceed the costs associated with it.

In summary, it can be established from the studies available that there are significant environmental benefits. These benefits in economic terms were calculated to be €153.2m per annum for landscape benefits alone, at a time when the total cost of implementing REPS (National co-funding and EU contribution) was €195.4m. No attempt has been made to quantify in money values the contribution of enhanced biodiversity and other environmental benefits. If these were included, it is very likely that the environmental benefits of REPS, on their own, would outweigh the total cost of implementing the scheme.

In last week’s article on the costs of REPS, it was shown that because of EU co-funding, REPS had no net cost to the Exchequer.

The State can, therefore, be said to be achieving enhanced environmental objectives at little, if any, net cost through REPS. Without a well-funded environmental scheme to succeed REPS4, benefits will be lost.

*T O’Leary , A McCormack, G Hutchinson, D Cambell, R Scarpa and B Riordan (2004), ‘Putting a Value on the Farm Landscape’ Paper presented at National REPS Conference.

REPS gives back more than it costs to run

Saturday, August 1st, 2009

Irish Farmers Journal

By Richard J Rea, David Walsh and Michael Ryan

The Agricultural Consultants Association (ACA) recently conducted a study on the economic benefit of REPS to the local economy and found that the scheme contributes more to the National Exchequer than it costs to run.

In this article, we will examine the immediate net cost to the Exchequer of maintaining the REPS programme.

Money paid through the Rural Environment Protection Scheme (REPS) has gone initially to the farmers involved, and ultimately to their suppliers and contractors, as well as to various retailers, Co-ops and shops in rural communities.

REPS payments in 2009 were budgeted to amount to some €330m. Even allowing for the 70% of expenditure on average, which farmers have to incur in order to meet the requirements of REPS participation, this represents a very considerable income supplement to the farmers involved who are mainly low income cattle and sheep producers.

However, the main beneficiaries of the REPS programme are not farmers, but the suppliers and contractors mentioned above.

Benefits of REPS

In the following paragraphs, we will attempt to quantify the benefits of REPS, as it currently operates, to secondary recipients and to the national Exchequer.

If we assume that of the €330m REPS payments, 30% or €99m, ends up as payment for the farmers time and labour then the remaining €231m is spent on inputs and services necessitated by REPS compliance.

This expenditure is predominantly on inputs which are subject to VAT. We can reasonably assume that half of this spending is on service provision such as contractors, builders or planners, which attracts a VAT rate of 13.5% and the remainder is on tangible inputs taxed at 21.5%. The total VAT take in this situation amounts to €34.4m (See figure 1).

The net figure spent on inputs after VAT is removed is therefore €196.6m.

This is the amount that is available to the providers of goods and services to cover wages, materials, overheads and profit.

We have conservatively assumed that 33.3% of net receipts by input providers goes towards wages and salaries, that a further 56.7% goes as cost of sales, i.e. the purchase of materials and overheads and the balance of 10% is retained as profit (Figure 2).

Calculate value

In order to calculate the value of this spending to the Exchequer in terms of taxes on income, we have made the assumption that the average employee in these businesses earns €25,000 per annum. We have also assumed that half of the businesses are incorporated and therefore pay corporation tax at 12.5%.

We assume the remainder to be sole traders who pay tax at 25%. Finally, we assume that 400 REPS planners earn on average €35,000 per annum. The figures for PAYE/PRSI in Figure 3 include the employers’ PRSI contribution. In the case, of farmer tax arising from the €99m accruing to farmers own labour input, we assume again that income tax, PRSI and levies will be paid at an average tax rate of 25%.

Employment

We now turn our attention to employment directly attributable to REPS. We have assumed average earnings of €25,000 per employee and earnings of €35,000 per REPS planner. Given a total wages bill of €67.2m, this suggests a total of 2,460 workers whose livelihood is directly attributable to REPS.

These figures are probably conservative. Closing down REPS would result in even higher job losses when the knock-on effect of the first round of job losses is taken into account.

This latter point is re-inforced by data from the recent Quarterly Economic Commentary issued by the ESRI (Summer 2009), which forecasts an 8.9% decline in GNP for this year.

Unemployment is forecast to increase by 6.3% over the same period.

Extrapolating from this data, using current GNP and unemployment statistics, while an inexact science, would suggest that removing €330m in incomes from the economy (c. 0.2% of GNP) would lead to an increase of approximately 3,100 in the level of unemployment nationally.

This figure corresponds closely with figures for job losses arrived at using the more direct measurement outlined above.

Multiplier

It is important to point out that because a large proportion of REPS expenditure goes to relatively low income households, it is likely to have a relatively large multiplier effect in the immediate economy.

In other words, as pointed out above, farmers are likely to spend a considerable portion of REPS receipts on associated activities such as maintenance, fencing, building and contracted activities. This type of spending will typically have a low import content when compared with spending by other businesses. It will therefore have a positive impact on the Irish balance of payments

Additionally, because low income households are less likely to save and more likely to spend on basic consumer items, the portion of REPS payments retained by farmers is also likely to be spent in the immediate locality as part of normal household expenditure. This further re-inforces the multiplier impact.

Using the lower figure (2460) for unemployment resulting from REPS closure, we can begin to calculate a figure for jobs seekers allowance.

To do this, we assume that half the applicants are married, with an average of two children, while the remainder are single.

Given current rates, this will result in average payment of €15,600 per annum or a total of €38.4m.

The complete closure of REPS would result in perhaps 15% of existing REPS participants qualifying for Farm Assist.

An average rate of €10,600 per farmer is assumed based on half the recipients being married with two children with the remainder being single. The resulting total is €98.6m in additional Farm Assist payments.

Immediate loss

The figures in Figure 4 quantify the immediate loss to the Exchequer of higher unemployment and reduced farm incomes.

To these should be added the less easily quantified second and subsequent losses of incomes and tax revenue resulting from reduced levels of spending by these two groups. We have ignored supplementary social welfare costs, such as increased medical card entitlement, higher spending on rent allowances and on similar schemes.

Current REPS funding is comprised of three elements – EU contribution, co-funding and additional State funding. The latter two elements come from the Irish Exchequer and amount to just over 55% of the total.

Therefore, approximately €181m of this year’s budgeted spending on REPS comes from the Irish Government. This cost to the Exchequer is considerably less than the €214.9m lost from revenue foregone, and the additional social welfare payments incurred (Figure 4).

In the presence of EU co-funding, REPS actually contributes more to the National Exchequer than it costs.

Even this is not the complete picture because we have made no attempt to put a money value on the environmental benefits of REPS to society and the economy in general. This aspect of REPS will be covered in a subsequent article.

*David Walsh and Richard J Rea are Agricultural Consultants.

**Michael Ryan is a lecturer in Economics at the Limerick Institute of Technology.

Money paid through the Rural Environment Protection Scheme (REPS)  has gone initially to the farmers involved, and ultimately to their  suppliers and contractors, as well as to various retailers, Co-ops and  shops in rural communities.

Irish Farmers Journal: Bypassing a farmer

Tuesday, May 27th, 2003

Irish Farmers Journal

By Mairead Lavery

It’s almost two years since we reported on young dairy farmer Donal Norris from Fiddown in Co. Kilkenny. At the time, the Piltown/Fiddown bypass was under construction and Donal was having difficulties with Kilkenny County Council over access to land, drainage and safety features of the new road. He was worried about the safety of his children and feared the new road would make his farm unworkable. Unfortunately his fears have come true.

Agreement ‘being ignored’

Last December the IFA agreed a new compensation package for landowners affected by Compulsory Purchase Orders for road-building schemes under the National Development Plan. Compensation for land is to be based on equivalent values for a similar piece of land in the same area. In addition, a per acre good-will payment will be available to landowners who co-operate fully with new road plans. Time frames for different notices, responses and payments were also agreed.

A letter from Michael Egan of the NRA dated January 7, 2001 says that all agricultural land under Compulsory Purchase Order (CPO) where compensation had not been determined by December 10, 2001, comes under the new IFA deal. The letter, which was circulated to county and city managers, adds that the deal also applies to landowners who are considering offers of compensation as well as landowners whose cases have been referred to arbitration.

This position was confirmed by Minister for the Environment, Noel Dempsey, in a written reply to Dail questions on the on the April 17, 2001.In it he said the NRA and local authorities would seek to facilitate landowners who chose to rely on the agreement.

However, Kilkenny County Council does not appear to be following this line. At a meeting of the council in late March, Donal Norris’s decision to withdraw from arbitration and seek compensation under the new agreement was greeted with scorn. The following comments of County Manager PJ Donnelly were reported in the Kilkenny People on March 29: ‘‘Now there is a request to go back to the IFA loop, and if this does not satisfy Mr Norris, as five previous agreements did not satisfy him, will we go back to arbitration again. It’s time they all saw sense and let this matter go for arbitration.’’

The IFA has confirmed that Donal Norris is entitled to come in under the new deal. However, Donal Norris maintains that as late as May 9 the council was insisting that he is not entitled to the terms of the new deal and must remain in arbitration.

On the 19th of March this year Donal Norris started to drive his 44 dairy cows on the new Fidown/Piltown bypass. He had to do it as they were out of grass on the 19 acres surrounding the yard. ‘‘I had no choice.

The cows were hungry and needed fresh grass. Most of our land is now on the other side of the new road. Before the bypass was built, getting to that grass was a simple matter of driving the cows less than a quarter of a mile along a small local road. Now the distance is 1.2 miles — across a very fast and busy road,’’ said Donal.

He had the same difficulty last October when the local road used by his family for generations to access the rest of the farm was first closed. Donal was not allowed to drive his cows through the narrow tunnel provided for cars. Furthermore, council officials told him that if he did use it, he would be fined €1,000 per day.

On the intervention of Michael Egan of the NRA, he was given temporary permission to use the tunnel. This was to apply until the council completed internal roadways through adjoining land to reach the rest of the farm. In early November a cow seriously injured herself in the tunnel and had to be put down. On veterinary advice, Donal stopped using it. Seven months later there’s still no sign of the internal roadways.

Last week 200 neighbours and friends staged a peaceful protest in support of Donal and his family. About 50 vehicles, including lorries and tractors, were driven slowly along the hard shoulders without causing disruption to traffic.

Donal has now decided to dry off 25 per cent of his dairy herd. ‘‘The strain is just too much. It takes 14 of my neighbours to herd the animals twice a day. I can’t keep asking them to do this. They have been so good to us, and I want to thank them for all their help and support. If the internal roadways are not put in within two weeks, I have no choice but to dry off another 25 per cent of the herd,’’ he said.

‘‘I feel singled out by the council. They just seem to want to get their way. I want to know who the real decision maker is because all I want is equal treatment,’’ he said.

Council statements criticised

Richard Rea of Martin and Rea Consultants in Agriculture and Business says statements about the Donal Norris case made at a recent meeting of Kilkenny County Council are not acceptable.

‘‘I want to reject two points made by the county council. The council claims that five agreements it put forward were turned down by Donal Norris.There were no agreements brokered with Mr Norris, and to claim anything other than this is totally wrong and not in accordance with the facts. I wrote to Kilkenny County Council on the 28th of March requesting details of these supposed agreements and the dates when Donal Norris rejected them. To date the council has not been able to back up its claims,’’ said Richard Rea.

He also rejects the council’s criticism about the way it is being portrayed since Donal Norris started to drive his cows on the bypass.

‘‘The truth hurts. It is a matter of fact that the cows were on the road. Donal Norris had no other choice. Kilkenny County Council has provided roadways of adequate width and length for other affected landowners. In fact, on the farm that Donal Norris has leased, the roadway provided is perfectly adequate. However, on the Norris home farm this is not the case. For some extraordinary reason, the roadway proposed here is both inadequate in length and width,’’ said Richard.

He said this was a critical matter for Donal Norris because the public roadway used by his family for generations is now closed off, and he must have an adequate alternative to reach the rest of his farm.

‘‘All Donal Norris wants is equal treatment. He wants the same as was given to other landowners. Because this was not done, he was left with no choice but to drive his cows on the new road or else cease to be a dairy farmer.’’

On November 8, 2001, a compromise solution was put forward.

This solution proposed that the County Council should provide the roadway and, if the arbitrator decided it was more than Donal Norris was entitled to, this would be taken into account in his final assessment for compensation. The council and the NRA rejected this proposal last week.

Tax audits: the new procedure

Saturday, March 15th, 2003

Irish Farmers Journal

By Helen Guerin of Martin Rea, Tipperary

Revenue audits have now been a fact of life since 1988. They were put in place alongside self-assessment for self employed tax payers. Self-assessment was the carrot & the Audit, the stick.

From 1988 to 1/9/02 the format for audits remained basically the same. If you have not had personal experience of an audit yourself then you probably know of someone who has.

The scenario went as follows. An audit letter was sent to you giving you a few weeks notice of the audit date. You met with your accountant in this intervening time and the accountant said to you – “if you have any sins to confess, now is the time”.

Maybe you then told him about the other bank account(s) where you were salting away a few pound/euro and he persuaded you to come clean. A disclosure of non-returned income lodged in these accounts was alluded to verbally on the day of the audit.

There was nothing put in writing and certainly there was no outstanding liabilities to tax, interest or penalties quantified on the day of the audit.

The Inspector took away the books and records to examine them and then the accountant started to quantify the undisclosed income in the bank accounts.

The amounts of income undisclosed would be quantified by the accountant and his calculations would be submitted to the tax inspector who would then proceed to quantify the tax.

A payment on account may or may not have been made at this stage to show cause and to minimize interest accruing. Haggling would ensue as to the amounts of interest and penalties would be charged, though in more recent settlements statutory interest would always apply.

The penalties, however, as a result of disclosure as vague as that outlined above could be negotiated down to nothing or a nominal sum of as little as £100 (€127) per year.

The outstanding liability as a result of the audit was paid over to the Revenue at the end of the audit when everything was agreed and finalised.

In many audits, publication was a negotiable issue and while prosecution did happen, it wasn’t an everyday occurrence. This was the Revenue Audit (old style).

The new style Revenue audit is a different animal. The new procedures are in place for all audits commencing 1/9/02. A three week notice period is given to the tax payer.

You must, now, however inform the Revenue within 14 days of the issue of notification of the audit that you intend making a disclosure.

You and your accountant are then allowed 60 days to quantify the shortfall and to make the relevant payment.

The statement of disclosure must be in writing. It must show the sources of income not previously disclosed. It must include a computation of all the taxes, duties, PRSI and levies and a statement totalling all these taxes and interest and penalties thereon for each period concerned.

A declaration must be made that the disclosure is correct and complete. The disclosure must be submitted with the relevant payment.

And then the audit begins.

Statutory interest is at the rate of 1% per month charged on a daily basis. This is non-negotiable.

The rate of penalty charged, in addition to the interest, however, depends on the greviousness of your sin.

You may make an unprompted disclosure to the revenue before you are notified of an audit, enquiry or an investigation.

If it was a innocent error under the category of insufficient care and the amount of tax computed on same is less that €3000 you may get away with no penalties.

If the tax is in excess of €3000 a penalty of 3% of the tax due would be charged for insufficient care.

An unprompted disclosure resulting from Gross Carelessness would result in a penalty of 5% and an unprompted disclosure resulting from deliberate default would attract a penalty of 10% of the tax due. All of the above would depend on full cooperation by you with the Revenue.

If, however, you have already been informed by the Revenue that they are initiating an audit, enquiry or investigation you can only make a prompted disclosure. If you make a prompted disclosure and co-operate fully with the Revenue the penalties applying here would be as follows :

Minimum 10% of tax due for insufficient care rising to 20% for gross carelessness and to 50% for deliberate default.

Without a prompted disclosure but with co-operation with the tax inspector the penalties would range from 15% (insufficient care) to 30% (gross carelessness) and up to 75% for deliberate default.

With no disclosure and no co-operation by you, penalties start at 20% for insufficient care rising to 40% for gross carelessness and to 100% for deliberate default.

Publication and prosecution

The advantage of making a qualifying disclosure are:

(1) penalties will be lower

(2) your name will not be published, and

(3) there will be no prosecution.

Publication

The Revenue Commissioners publish a list at the end of each quarter of the name, address and occupation of each taxpayer where a settlement has been made under audit or investigation with the following exclusions : You will not be published if

(1) you have made a qualifying disclosure or

(2) the total settlement including interest and penalties for all years is under €12700

(3) the penalties charged was under 15%

(4) cases where the 1993 amnesty applied.

Prosecution

The following are examples of offences which are most likely to be prosecuted :

(a) Use of forged or false documents,

(b) Systematic scheme to evade tax,

(c) False claims for repayment,

(d) Failure (as distinct from minor delays) in paying taxes,

(e) deliberate and serious omissions from tax returns,

(f) Use of offshore bank accounts to evade tax

(g) Insidious schemes of tax evasion

(h) Aiding and abetting the commission of a tax offence.

When the likelihood of prosecution is on the cards, the Revenue auditor must caution you – “You are not obliged to say anything unless you wish to do so, but whatever you say, will be taken down in writing and may be used in evidence”. You are not obliged to incriminate yourself. However, if you do not reply to the questioning of the Revenue Auditor this fact will be noted.

The advice of your solicitor should be sought before any replies are given or any statement made. If you opt to make a statement it should preferably be in your own writing. When completed it should be read over carefully before you sign same.

Each page of the statement has to be signed by both yourself and tax Revenue Auditor. In future, Revenue audits will be more onerous, more costly to complete and the tax penalties very severe.

The tax payer should aim to have good records and thus have no fear of Revenue audits.

Irish Farmers Journal: The employee of the future

Saturday, August 18th, 2001

Irish Farmers Journal

By Thomas Hubert

Peter Byrne, manager of Farm Relief Services, thinks that farm workers will have to be specialists with adequate training in the coming years.

With farms getting always bigger, farmers will be less numerous but more likely to hire employees. “The number of units of labour in agriculture will drop, but the proportion of employees and contractors will rise,” he says.

However, we are no longer talking about manual, unqualified workers. He thinks the typical farm employee in a couple of years will be someone with farming qualification – for example, a part-time farmer or someone who had to sell a small farm – and specific additional skills.

These skills will be acquired and certificated through training programmes such as those offered by FRS and certified by the National Council for Vocational Awards. “Health and safety are going to be big issues,” says Mr Byrne. There are too many accidents on Irish farms and farmers will no longer hire an employee unless they are sure he or she can perform the task safely,” he says.

The trend is towards specialists owning their own equipment and contracting with farmers for a specific job. “There is little point in a farmer owning the machinery and tractors if he is dependent on hiring in drivers – it will be more attractive to contract the job to a person with the equipment and the expertise to carry out the task,” says Mr Byrne.

However, there will also be opportunities on the management side. Owners will be looking for people who can run the farm as an enterprise, possibly on the basis of a profit-sharing arrangement.

Mr Byrne’s outlook for the future of farm employment is “very positive”. “It is attractive and will be more attractive in the future,” he says. Jobs will become more interesting and farmers tend to treat the labour force better and better. “It is so much better than standing at a production line in a factory!” he says.

Richard Rea, agricultural consultant, says his future employees will need to be “50 per cent farming, 50 per cent business and a bit of law”.

Their ideal qualification would be an agricultural degree with two years of experience. People who have already worked for a couple of years in the public sector have the level of confidence and the knowledge of the law, the banking system, etc. that are necessary to begin a career in agricultural consulting, he says.

According to Mr Rea, a lot of jobs will involve compensations assessment for road works and environmental impact studies over the next years. But the most interesting job will be helping farmers to set up on-farm part-time businesses.

“There are two categories of part-time farmers,” says Mr Rea, “those whose farm income is too low, and those who are very successful and want more challenging experiences”. He believes the latter will have more and more money to invest in businesses such as hotels or catering facilities and will need advice from consultants to do so.

Mr Rea thinks most of the opportunities will be located in the West. “Farmers there are already accustomed to off-farm jobs, they are more adventurous,” he says. On the contrary, he thinks farmers in the South and East often see off-farm activity as a failure and are not so keen on new developments.

His prospect for the consulting sector is stability. When he started working in 1974, there were 7 consultants employing less than 20 people nationwide. There are now 80 consultants and 250 to 300 people in this business, plus competition from Teagasc, which is “heavily subsidised”. He thus does not expect his trade to grow as fast as it did over the last 25 years.

Dr Noel Cawley, chief executive of the Irish Dairy Board, puts a lot of confidence in third-level education.

According to him, any graduate, whatever the course, can start a career in agri-business. “You can do anything after that, it is a complete training in itself,” says Dr Cawley.

He remarks that as people retire earlier, the face of employment in his sector changes quickly. As a result, young graduates are more and more likely to access challenging jobs, even top management positions. “There are opportunities everywhere,” he says.

More specifically, Dr Cawley encourages people interested in a career in agri-business to study basic sciences such as maths and physics. “There will be a significant shortage of people with science degrees,” he says.

His piece of advice to students: “Get as much training as possible in college; if possible, get a post-primary degree.”