Offaly farmers in line for average €100,000 compensation pay outs in pipeline deal

FARMERS in Offaly and Tipperary are expected to receive average compensation payments of €100,000 in an agreement reached between Uisce Eireann and the farming organisations on the controversial Shannon pipeline project to bring water to Dublin and the east.

The pipeline will travel from the Parteen basin through counties Tipperary, Offaly, Kildare and Dublin, before reaching the capital.

Following months of negotiations, the farming organisations have agreed a compensation package that includes upfront payments for impacted landowners on a voluntary wayleave package for Water Supply Project Eastern & Midlands Region.

"This package reflects the scale and strategic importance of the project and aims to mitigate the impact of construction and operation on agricultural land," a statement from Uisce Eireann in the wake of the deal said.

In a joint statement the Irish Farmers Association (IFA) and the Irish Creamery Milk Suppliers Association (ICMSA), said the package contains four main elements - an early sign on payment; a wayleave payment; a crop loss and disturbance payment; and an WSP special goodwill payment. There are additional payments in the package for farmers who will have ancillary apparatus such as air valves, line valves, wash outs chambers and lay-bys on their land. 

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The statement continued: "Farmers have the option of accepting this offer under the negotiated voluntary wayleave agreement with Uisce Ėireann, or pursuing their claim through the relevant statutory processes.

"The deadline date for the return of consent forms to UE has been extended from September 23 to October 7 to provide more time for farmers and landowners to consider the package and get the necessary advice."

Uisce Eireann said it is "engaging directly with landowners on the compensation package. In July, Uisce Éireann issued a wayleave package to over 500 landowners along the proposed pipeline route, to acquire wayleaves on a voluntary basis. This will enable the acquisition of the necessary rights to lay, operate, and maintain the pipeline infrastructure, in advance of the submission of the Strategic Infrastructure Development planning application later this year."

Mike Healy, Uisce Éireann Programme Director, said: “The need is clear - water supply in the Eastern and Midlands region currently faces major challenges, notably the over-reliance on the River Liffey to supply 1.7 million people in the Greater Dublin Area. With forecasts showing that the region will need 34% more water by 2044, this combination of a growing water supply deficit and lack of supply resilience is simply not sustainable.”

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Meanwhile, in relation to concerns raised regarding the payment of VAT, the IFA and ICMSA say they have received the following undertaking from Uisce Eireann

“The obligation to determine the tax treatment of the wayleave package rests with the landowner. It is the understanding of Uisce Éireann that only the permanent easement element (inclusive of ancillary infrastructure) is potentially subject to VAT, and we are not aware that any other elements of the package are subject to VAT. If it is determined that other elements are subject to VAT and if it is shown that VAT should be applied to any other or all components of the package, we will refund the VAT in full once provided with a VAT invoice from the landowner concerned.” 

The IFA and ICMSA have sought further advice and guidance on VAT, particularly the situation in respect of unregistered farmers and this is a matter that all parties need to work on and get clarified as soon as possible.

During the negotiations which involved over 25 meetings, the IFA and ICMSA expressed concerns about the implications for farmers if there are long delays to the planning or with the pipeline being completed.

The package provides for inflation with CPI indexation for the payments which are not made upfront such as the crop loss and disturbance payments and also provides for CPI Indexation for the WSP goodwill payment from 2030.