The Department of Agriculture, Food and the Marine (DAFM) has said that reference costs for the Targeted Agriculture Modernisation Scheme (TAMS 3) are, in general, “not too far off the mark”.
Paul Savage, assistant secretary of rural development and forestry with DAFM, made the comments at the Joint Oireachtas Committee of Agriculture last evening (Wednesday, July 3).
Farming organisations have repeatedly called for a review of the TAMS reference costs to account for increased costs of materials.
TAMS
In response to a question from Fianna Fáil Senator Paul Daly, the department official said that reference costs are reviewed on “an ongoing basis”.
“The last time we reviewed them was essentially in late 2022, early 2023, before we introduced TAMS.
“I think in a general sense from the evidence we’ve seen we’re still not too far off the mark as far as reference costs is concerned.
“We will carry out a review. We will have to look at the costs, the receipts, the evidence we have from the current scheme in terms of people who got their approval and submitted their claims.
“We’ll look at those in terms of what the evidence is telling us and we’ll consider it in the broader background from an economic point of view of material costs, labour costs and other things that are feeding into the equation as well,” Savage said.
He told the committee that “a fairly extensive review” of reference costs will be carried out in 2025 “when we have the evidence fully there”.
“That should allow us to address any particular issue that’s there in terms of reference costs being out of kilter.
“But I think in an overall sense the evidence is that in large parts of TAMS we’re still pretty much on the money in terms of what the reference costs are, with maybe some exceptions,” he said.
John Muldowney, principal officer with DAFM, added that the department is “keeping a very close eye” on reference costs.
“At the moment, in the majority we’re reasonably close, we’re still reasonably happy with what’s there.
“There’s one or two items, machinery items in particular, where they [costings] might fall out of kilter for some particular reason,” he said.
Muldowney explained that the reference costs are based on TAMS receipts submitted by farmers, surveys of engineering and building provider companies and data from the Central Statistic Office (CSO) and Quantity Surveyors Ireland.
“At no point do we really want to race ahead of what the prices are. Otherwise, you spur on the industry to push up the costs.
“This is always a very hard balancing act that we have to try and manage the reference costs to keep them reasonable with what’s there,” he said.
The committee heard that between July 2021 and the end of 2022 three reviews had been carried out and reference costs had increased by nearly 30%.
Applications
Paul Savage said that 21,115 applications were submitted in the first three tranches of TAMS 3.
This is almost three times the volume of applications received in the corresponding tranches of the previous TAMS scheme.
“To date, more than 13,800 approvals have issued, with approvals in respect of all tranche 2 applications expected to issue by the end of this month (July),” he said.
Noting the “commentary” on the delayed rollout of TAMS 3, Savage said that the development of the new scheme “involved significant upgrade of systems” in the department.
“TAMS 3 payments commenced in June, and payments are continuing to issue on a weekly basis. To date, approximately €3.5 million in payments have issued to farmers,” he said.