ICOS' Siobhán Mehigan says rural economy must be central focus for new government
A new government will be formed and they’ll be off and running.
It would be a real shame, however, if the content of all the debates, the proposals, arguments and commentaries are not heeded and integrated in large measure into the next programme for government.
Where clear measures can be introduced to provide economic and societal benefit, then the next government must accelerate these and make them happen.
Not to deliver on current promises being made will be the recipe for an electoral disaster the next time round.
ICOS and our members want a promise from the next government — that it will focus specifically on the creation of a stronger rural economy.
Since our inception in 1894, ICOS has been working at developing and establishing rural co-operatives to support rural farmers and businesses in helping themselves.
The prime example of success in these initiatives can be seen in the vibrancy and economic contribution of the multibillion co-operative dairy processing industry, national livestock marts, and co-operative enterprises in many industry sectors.
Co-operatives are sometimes referred to as “the children of distress” as their foundations are based in difficulties in communities or enterprises but who are also without any support from private or public services.
Co-operatives in Ireland are following on this tradition of self-help and looking at providing solutions to issues being faced in the agriculture and rural co-operative sector rather than just highlighting problems.
ICOS has published a manifesto with a number of suggested policy changes that can support and facilitate the development of more co-operative businesses in Ireland. It’s not rocket science but it does require a commitment from the next government.
This ICOS manifesto looks at the wider rural enterprise sector.
It highlights sectors with potential to develop new Irish-made jobs and income streams for rural communities, which are widely acknowledged as being left behind in a Dublin-focused economic recovery.
The co-operative model is under-utilised in many rural sectors, including tourism, craft, artisan food, and renewable energy to name a few.
The structures intrinsic in our co-operatives lend themselves to sustainable rural economic and community development but there is a deficit in understanding of the model in national and local support structures.
Renewable energy is to get a boost in 2016 with the announcements of a renewable heat incentive and a solar tariff to be confirmed this year.
With many lessons to be learned from our experience with wind, community support will be vital for the progress of these initiatives. There is also great scope for communities to produce renewable energy themselves.
The co-operative social enterprise sector, established to tackle social, economic or environmental issues, should be promoted and supported by the next government as an additional means of generating economic activity in rural areas.
It has a great potential to reverse the decline in rural communities.
We have launched a new agri-taxation proposal to combat extreme income volatility in the dairy sector.
The objective is to address a weakness in the existing income averaging system, which provides a benefit to farmers when profits are rising but can be a cost around your neck when profits are falling.
Targeted for the next budget, the proposed ICOS “5-5-5” income stability tool would allow farmers, who are participants in the five-year income averaging scheme, to voluntarily defer up to 5% of their milk receipts in any given year.
The money would be retained in their names in a recognised, interest bearing fund, to be managed by their co-op, as a loan-stock-type instrument.
The money can be drawn down at any time, and subject to income tax at the time of draw down, but in any case, the funds must be drawn down within five years.
This 5-5-5 proposal on its own will not solve income volatility in the dairy sector but it can help farmers to manage the worst extremes.
Our beef sector is also vulnerable to many factors and our co-operative livestock marts are looking at alternative ways of doing business to sustain the 100,000 family farms producing beef in this country.
The power of retail multiples and beef processors through labelling conditions and restrictions on cattle movements is unfairly driving prices down for beef farmers. We want that addressed.
A programme of European Investment Bank funding to support the rural sector was announced in 2015.
This should be implemented rapidly by the Department of Agriculture to ensure cash flow on farms and rural businesses isn’t restricted by our banking sector.
Siobhán Mehigan is a co-operative development executive with the Irish Co-operative Organisation Society (ICOS). More detail on these proposals can be seen on www.icos.ie
