Fuel Supports to the Agricultural Sector: Statements
Seanad Éireann — 2026-04-21
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Martin Heydon (FG), Kildare South

I am delighted to have the opportunity to join Senators today for what is a really important and timely discussion. The Government recognises the exceptional pressure that rising fuel costs is placing and has placed on our farmers, contractors and fishers in particular. I have heard it from friends, neighbours and in my ongoing engagements with all of our agrifood representative bodies in recent weeks, including the main farmer and farm contracting organisations with whom I engage regularly. Green diesel has almost doubled in price, from less than €1 per litre in a matter of weeks, right at the time when farmers and contractors are in the middle of a very busy spring season and facing into a very busy silage season too. The same is true on the fisheries side. This is why the Government approved a substantial package of supports, including the full removal of all non-carbon excise on green diesel to the tune of 7.4 cent per litre and a further payment that will provide support equivalent to 20 cent per litre through a €100 million fuel support scheme. These supports when taken together total 27.4 cent per litre and exceed by nearly 6 cent per litre the entirety of excise, both carbon and non-carbon, charged on green diesel prior to the conflict in the Middle East, which then stood at 21.95 cent per litre. It will benefit farmers and contractors, recognising their central role in sustaining essential food production.
This is about much more than just one sector, though. It is about support for every citizen in the State because when input costs rise, it puts pressure on the price and availability of food for all consumers. Energy shocks without support will lead to significant inflation, particularly in respect of food, on which we all depend. Unchecked, it would have a direct impact on the cost of living for all. By supporting the agrifood sector, our hauliers and all of those reliant on fuel who play a role in getting food from farm to fork, we support everyone. Approximately 120,000 farmers and 1,500 full time agricultural contractors will be eligible to apply for support. There is also provision within this funding to support fishers. I understand that my colleague, the Minister of State, Deputy Dooley, will address the House on the specifics of the fisheries support shortly but I am happy to answer any questions Senators may have on that today. A fund of €5 million per month will be provided in a targeted way to support our fishers and specific specialist horticulture and forestry workers.
For farmers, agriculture and forestry contractors, this targeted and practical support package, based on actual fuel usage last year, ensures that those who are most exposed to these increases will receive meaningful assistance at a critical time of the year on farms. This approach is in line with discussions I have had with key stakeholders, farm organisations, representative bodies and contractor representatives and ensures that funding is directed where it is needed most, that is, helping to sustain essential food production and rural economic activity. It will also, for the first time, provide a direct support to farm contractors, recognising the vital work they do in our farming and forestry systems. This coincides with the first meeting of the farm contracting working group facilitated in line with the programme for Government commitment. Payments will be made through a single application process, with funding allocated based on historic fuel usage in 2025. The need for the scheme to be targeted was strongly emphasised in ongoing engagements with the farmer representative bodies and the farm contractor groups and organisations. My Department has undertaken intensive preparations since last week's Cabinet meeting to approve the €100 million fund to implement the fuel support scheme as quickly as possible.
Yesterday my Department met farm organisations and contracting bodies to discuss in detail the planned implementation of the scheme and I will shortly update my colleagues in Cabinet on same. Timelines will be carefully managed to co-ordinate with the existing payments schedule and ensure delivery of these supports as soon as possible. Liquidity and cash flow may arise as issues for some farmers and contractors in the coming months. Conscious of this, I have written to the main banking institutions asking them to show forbearance with the agrifood and fisheries sector where cash flow issues are emerging and to continue to support these sectors during periods of financial pressure with access to the appropriate levels of short-term finance. I will be meeting the main banks in the coming days and will emphasise these points to them also.
I will speak briefly on the wider package of supports that have been announced. On 24 March the Government introduced €250 million worth of targeted measures to provide temporary reductions in the rates of mineral oil tax applicable to petrol, auto diesel and marked gas oil or green diesel, as we know it. The Government also reduced the NORA levy from 2 cent per litre to a nominal amount for a period of two months. We were clear when we announced our initial package of measures last month that we would keep everything under review, conscious of the ongoing global instability. I made it very clear at the time that our first intervention would not be our last. It was very clear at that time, when the move was on the non-carbon excise element of the diesel price, that there was very little of that on green diesel due to the ongoing support the Government provides to our agriculture sector. The fact was that there was very little non-carbon excise on green diesel in the first place. Similarly, it is not on the fuel that fishers use for very good reasons, namely, that this is about food production and beyond. It meant that in the first intervention farmers felt that it had very little benefit for them compared with the broader package but I was, at that time, working on the broader package. I was working with the contractors' association and beyond. It was very important that we continued to develop a new scheme so that, for the first time ever, we would have a dedicated, targeted scheme for contractors as well as farmers.
Following that initial package I continued to engage with agricultural stakeholders. In early April the Tánaiste and I met farm and farm contractor representatives. I held a further meeting with a wide range of agrifood stakeholders on 10 April, followed by a series of bilateral meetings on 11 April. On 12 April the Government announced a new package of measures on fuel costs to support the transport, farming and fisheries sectors, reducing excise on a VAT inclusive basis as follows: diesel by a further 10 cent, bringing the total reduction on auto diesel to 31 cent per litre; petrol by a further 10 cent per litre, bringing the total reduction to 27 cent per litre; and marked gas oil or green diesel by a further 2.4 cent, bringing the total reduction to 7.4 cent per litre. These overall reductions include the NORA levy reduction. Green diesel or marked gas oil, while appearing to be a relatively smaller decrease, is subject to a reduced rate of excise duty compared to petrol and auto diesel. The combined reductions mean that non-carbon excise duty on green diesel is now zero. The Government is also deferring the planned increase in carbon tax scheduled for 1 May until the budget. This will impact green diesel and non-propellant fuels such as kerosene, heating oil, natural gas and solid fuels. The reductions in excise on fuel for consumers take effect from 14 April and run until 31 July. The NORA levy reduction will also run until 31 July.
I thank colleagues in the House for their ongoing engagement through what has been a very difficult period for the country and for everybody who serves in public office. As we strive to help those most affected by these challenges, we have to manage and navigate a number of hurdles that present themselves. The transposition of the energy directive into Irish law is important and from a European perspective, our engagement with Europe is also really important. State aid rules and the implications of any work we do are also a consideration. These are issues the Government has to work on that the public do not see at face value. I understand that the very viability of some businesses is potentially challenged and people are seeing the very real risks in trying to make the numbers stack up. Contractors faced increases in their diesel bills, at the busiest time of the year, of potentially €70,000 or €80,000. They had real concerns about not being able to access the credit that they would normally access. I know from my own farm at home that generally the system works on the basis of the contractor carrying out the work at the busiest time of the year and the farmer paying later in the year when the cattle are sold or the grain cheque comes in. That business model was going to be greatly challenged in this space so it was right, for the reasons I outlined in terms of the impact on inflation and the cost of living for every citizen in the State, to support our farmers, fishers and hauliers. As an exporting nation and an island, we are so dependent on hauliers for moving products around. If we had allowed costs to run to such a level that they challenged the business model to such an extent, then we would risk increasing the costs of the products that hauliers deliver. Supporting them supports every citizen in the State. There is a very strong financial case for supporting our farmers during this period and for directing support to contractors. My engagement with the farm contractors of Ireland and beyond has been about meeting the programme for Government commitment, established last year, to establish a working group within my Department. That working group has now been established and I am very proud to say has already met. The contractors now have a dedicated resource within my Department to work through a number of issues that have been a concern for a long time. I am really proud that my legacy in the Department will be one of increased support and a better standing for contractors than they had heretofore. This is also the first ever time that we will have a scheme that is dedicated to contractors as well as farmers while differentiating between the two. That brings its own challenges. It means that we have to clearly agree a definition of a farmer and we have to agree thresholds and the normal parameters that there would be in any scheme to be able to reassure people that it will provide value for money for the taxpayer.
I thank people for their support and recognise that this is a significant intervention by the Government to support our farmers, fishers and farm contractors.

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Record URI: https://data.oireachtas.ie/akn/ie/debateRecord/seanad/2026-04-21/debate/main
Retrieved: 2026-08-14T04:54:50+00:00
Sitting date: 2026-04-21