Dáil Éireann debate -
Thursday, 19 Jul 1973

Vol. 267 No. 9

Dairy Produce (Miscellaneous Provision) Bill, 1973: Second Stage.

Minister for Agriculture and Fisheries (Mr. Clinton)

I move: "That the Bill be now read a Second Time."

The main purpose of this Bill is to provide for the altered situation in regard to exports of dairy produce following the application of the EEC agricultural arrangements here on 1st February last. I should like to make it clear at the start that there is nothing in the EEC regulations to prevent us from continuing to have a statutory Bord Bainne. Some of the board's former activities and functions would, however, be inconsistent with EEC regulations, and this is what gives rise to difficulty. In particular, the monopoly export position of the board could not be continued. Under EEC regulations we could not prohibit other persons from exporting dairy products, and so the fundamental basis of operation of the statutory board, that is their export monopoly, has had to be abandoned. In these circumstances, the dairy industry was encouraged both by my predecessor and by myself to come together and provide for continuing on a co-operative basis the functions previously carried on by the statutory board with the support of compulsory powers. I am glad to say that the industry has responded to this encouragement, and that the vast bulk of the creameries and processing firms are already participating in the new co-operative body —An Bord Bainne Co-operative Ltd.

In a few instances there has not been complete acceptance of the new board, but I am confident that the efforts being made to overcome the difficulties arising in these instances will be successful. I would point out to the interests concerned that international trading today is based on large-scale units. Only such units have the necessary volume of sales and command the necessary expertise in marketing and promotion to make a real success of international trading. I do not deny that for a short time individual exporting may be more successful than operating through a centralised exporting body, but over a period the advantages are certainly with the large centralised units.

Over the past decade an Bord Bainne have developed a high reputation as the export marketing body for Irish dairy produce. Their Kerrygold brand has gained an acceptance abroad which few, if any, Irish products have ever secured before. It would clearly be a retrograde step if we were now to throw away all the success that has been achieved and return to the situation where a large number of creameries would be exporting small quantities of butter and be entirely at the mercy of large foreign purchasers. I do not think there can be any doubt whatsoever about this.

Also, at the present time it is necessary to diversify production and get away from a narrow range of products. In recent years we have, of course, reduced greatly our traditional dependence on butter. Production and export of Irish cheese has increased spectacularly. Chocolate crumb, whole milk powder, skim-milk powder, milk-based animal feeds, casein, as well as canned milk and cream and fresh cream, have all accounted for substantial quantities of milk. But much more remains to be done. We must get into the more sophisticated milk lines. Of course, our dairy industry could sit back and sell its milk in the form of butter and skim powder to intervention. But this would not give Irish farmers the level of return which could be obtained from selling on export markets a wide range of processed dairy products. It is essential that we in Ireland should not let slip the opportunities that are now open to us in this sector. Again here, a large centralised exporting body is obviously in a position to arrange for the development and production of new products, and to carry on the considerable promotional and marketing work that is needed to get new products established on the market and build up a worthwhile trade in them.

I should now like to turn to the Bill itself. Section 3 provides for the transfer of the assets and liabilities of the statutory Bord Bainne to the new co-operative society or board. These assets were financed by the former levy on milk supplied to creameries, and so they are really the property of Irish creamery milk suppliers generally. Until the accounts of the statutory board have been finalised and the board are being dissolved, it is not possible to indicate precisely the net value of the assets being transferred. The final figure, however, is expected to be of the order of at least £2½ million. This would be represented mainly by investments in a British subsidiary, by an office block in Dublin and by some cash.

It is provided in section 4 that the assets transferred shall be used for the orderly marketing and distribution of dairy products for the benefit of the dairy industry. These assets, as I have said, have been derived from a levy on milk producers and so it is appropriate that they should be used to benefit producers as a whole. If the new society wish to dispose of or use these assets for purposes other than those specified in this section of the Bill, my consent must be obtained. This provision, however, is merely intended as the final safeguard for the producers' interests.

In section 5 provision is made for the dissolution of the statutory board. At the moment it is not possible to give a precise date for this as it will depend on when all matters such as the finalising and auditing of the boards accounts have been settled. I might refer here also to section 8 of the Bill which provides that 1973 shall not be a nomination year for the purposes of the Dairy Produce Marketing Act, 1961, under which Bord Bainne was originally established. The reason for this is that the term of office of the existing members of the board expires on 30th September next but in view of the impending dissolution of the board it is clearly undesirable to go through the elaborate procedure of nominating and electing new board members for what is likely to be a very short time indeed. Accordingly, section 8, in effect, prolongs the term of office of the existing members until the board is dissolved.

The operations of An Board Bainne have involved the borrowing of very large sums to finance the purchase of dairy products from creameries and processing firms. These borrowings have in the past amounted to nearly £40 million at peak. Because of the higher value of dairy products under EEC conditions and in view of the substantial increase in milk production, the borrowing requirements of the new society are likely to be even greater than those of the statutory board. Under the 1961 Act a guarantee in respect of borrowings of up to £5 million by the statutory board could be given by the Minister for Agriculture and Fisheries.

The new co-operative society, while largely the old board under a new guise, has to build up the same reputation, confidence and borrowing power which the old board had, and to assist it in this the Government have decided to guarantee borrowings by it up to a total of £20 million. The State guarantee under section 6 of the Bill will be available up to the end of 1977, by which time I would expect the new society to be able to stand on its own feet in the matter of borrowing. Moneys borrowed by the society under a State guarantee can be used only for the acquisition of dairy products in the ordinary course of business, and a statement giving particulars of any guarantees given by me will have to be laid before each House of the Oireachtas each year.

Sections 7 and 9 provide for the interests of the staff of the statutory board. In effect, the staff are transferred to the new society on the same terms that previously applied to them, and detailed provision is being made for preserving their superannuation rights. I may say that the society and the staff have agreed to the transfer.

The 1961 Act provides that in any financial year the amount of the Exchequer grant to An Bord Bainne under that Act shall be limited to not more than two-thirds of the board's export losses and subsidies, the other one-third being met out of the proceeds of the levy on creamery milk suppliers. At the end of 1971 with a view to gearing ourselves for entry into the EEC the milk price support arrangements were re-structured, and the former multi-tiered milk price allowance and the quality allowance were incorporated into the higher support prices payable by An Bord Bainne for dairy products.

The resulting substantial increase in the Board's export losses and subsidies, which merely reflected the change in the method of paying Exchequer support, consequently fell to be met entirely by the Exchequer which had previously been bearing the full cost of the milk price and quality allowances paid direct to the creameries. The small amounts arising in the period between December, 1971, and 31st March, 1972, were dealt with on the former two-thirds/one-third basis but for the period from April, 1972, onwards it is necessary to remove the statutory two-thirds limit on the proportion of the board's losses and subsidies which may be met by the Exchequer. This is provided for in section 10 of the Bill.

It is not necessary for me to emphasise to the House the importance of the dairy industry and the vital position it holds in the agricultural sector, and, indeed, in the economy as a whole. In the past the industry was never able to develop its full potential because of difficulties on export markets either in the form of quantitive restrictions of one sort or another or in the form of very poor prices. Now, with Ireland's accession to the EEC all this has been changed, and the industry is in a position to develop and expand on the basis of the considerable natural advantages which Ireland has for the production of milk. Our producers are already responding to the new opportunities available to them, and it is important that the marketing side of the industry should also gear itself rapidly to make the most of the openings that are now available. In this Bill the Government are demonstrating their confidence in the new marketing arrangements which have been drawn up by the dairying industry itself, and I trust that the House will readily approve of its terms.

Mr. J. Gibbons

Our view about this Bill is that it is a necessary piece of legislation that arises not only out of our entry into the European Community but out of the rapid growth of the dairy industry. Gone are the days when the Irish dairy industry was a type of mendicant industry dependent on poor markets in Britain and elsewhere and poor prices which, as the Minister has just said, tended to depress the industry chronically and prevent it from ever reaching its real potential.

We have all seen in the last couple of years the rapid strides which have been made by the industry now that the traditional restraints which hindered the industry in the past have been removed. The very establishment of Bord Bainne was a measure adopted by the Irish Government of the time in order to tackle the marketing of our products in the best possible way within the constraints we found ourselves in at that time. It is realistic to say that the dairy industry is a big boy now and that it does not need, to the same extent at any rate, to rely on the assistance of a semi-State organisation to do its business for it. That is why I concur with the Minister's expectation that after a few years the industry will be well able to stand on its own feet. If we continue to make the progress we have been making in the last two or three years the Minister's expectation will come to fruition.

Obviously, a unified selling organisation is necessary. The effectiveness of the old Bord Bainne demonstrated this sufficiently. I do not suggest that was an organisation without blemish but it certainly did a very good job. They demonstrated that if the Irish dairy industry gets down to organising the marketing of its produce it can market and sell it as effectively as anybody else can do it.

I was glad to hear the Minister referring to the necessity for diversification within the industry. We know of the traditional reliance on butter and, to some extent, dried, skimmed powdered milk, chocolate crumb and other items. In the European context now especially in view of recent statements by Commissioner Lardinois and influential people like Mr. Schmidt, the Finance Minister of the Federal Republic of Germany, on the production of surpluses and in particular on the production of surplus butter the dairy industry has need to seek alternative products which it could manufacture and sell with more effect than the unchanged reliance on butter manufacture. This will be a problem for the new board. I realise it is not an easy problem, that the butter fat must be sold in one form or another and, whatever M. Lardinois says, the contribution of the Irish dairy industry will remain a relatively small quantity in the EEC context. Nevertheless, it would be to our own advantage that every possible alternative use should be sought for our milk products.

I am glad the Minister maintained for himself the position of final custodian of the safety of the industry. He retained this right when, for example, he kept the right to dissolve the board if necessary. I realise it is a power that almost certainly will not be used but it is well that the Irish Minister for Agriculture is the final guardian of the interests of the milk producers so that he may intervene if these interests are lost sight of by a future board. This is especially the case because the Irish Minister in the future, as always, will be responsible to the House. Bord Bainne in a unique way will be ultimately responsible to the public representatives elected by the people.

I should like to refer to the question of workers' security in the dairy industry. We have had occasion in recent times to discuss the possible arrangements that might be made with regard to the organisation of milk supply and manufacture in the Limerick-Clare area. As the Minister and the House know, this involves the security and the future of many hundreds of workers and their families. We have spoken about the final custodianship of the Minister; he should think about the workers in the industry and his responsibility to them. He should make it clear to the new board that it is simply not on to discard totally in the interests of coldblooded, but possibly misguided, economics the future and the wellbeing of the workers. If that is done, the industry will hit heavy weather and will rue the day it lost sight of this vital element in our future prosperity.

I should like the Minister in his reply to discourse a little on the type of cohesion he envisages between the new Bord Bainne and the IAOS, especially with regard to the integration of the industry. It is vital that there be unanimity between these bodies and also between them and the Department on the finalisation of the organisation of the industry.

Finally, perhaps the Minister could tell us if all the big boys in the industry have indicated their agreement to participate in the new Bord Bainne. He should tell us if those big concerns—I am talking about Avonmore, Waterford, Mitchelstown, Ballyclough and Golden Vale—have indicated their readiness to participate in a unified Bord Bainne. I hope they have and I would certainly recommend to them that they should. However big or powerful any federation or unit of creameries may think they are in this country, when we enter the big league we require each other's assistance and strength. We require unity in our own industry. I should like the Minister in his reply to enlighten us in this matter.

Notice taken that 20 Members were not present; House counted and 20 Members being present,

Mr. McDonald

I should like to support this measure and to compliment the Minister on the clear way he explained the Bill in his speech. There were a few sections about which I was not very clear but, by and large, the Minister has clarified those matters. I had been anxious about section 6(3) but the Minister has told us that the guarantee will continue until 1977. Personally, I think a shorter term might have been more appropriate because it is very important that the new board should continue to perform their work in a positive and dynamic way. It is important to ensure that, if expansion is necessary, it is done in the transition period vis-à-vis the EEC.

I should like to take this opportunity to compliment Mr. McGough and his staff and the outgoing Bord Bainne on the success they achieved over the years, and especially in recent times. It is fair comment to say that Bord Bainne have been more successful in selling butter, which is not an easy commodity to move in these times, than the European Commission were. They have had difficulty in giving it away. It is a problem. The new Bord Bainne should be guided by, and should take note of the fact that the negative attitude and negative proposals which were adopted over the years by the European Commission have not achieved success. Therefore, now more than ever, if our dairy industry is to get a fair chance, and if our farmers are to benefit from the guaranteed price as long as their CAP lasts, we must not just rely on the intervention price but get out and sell in the highest market, whether it be inside or outside our community.

I should like the Minister to explain the significance of section 7 (2) (b). I do not know if it is very important, but there is a date there. Deputy Gibbons touched on this and on the fact that, not only in Bord Bainne, but in the entire industry, post-amalgamation, we find small categories of workers whose future seems doubtful. Over the past years, carters have provided an excellent service in many rural areas and especially in the nontraditional creamery area. They canvassed active support from the farmers and enabled them to send their milk to the creamery. Some of them suffered the rigours of the law for setting up that kind of service in some areas. They now find that their future is doubtful. Amalgamation was bad enough, but when rationalisation sets in, in the not too distant future, perhaps, their livelihood will become more precarious with the introduction of the new modern tanker system.

I was interested to hear Deputy Gibbons speaking about the IAOS. This is an opportunity, perhaps, to strengthen the role which this organisation with tremendous experience can play in agriculture in the future. Our co-operative movement is very firmly founded. We have many co-operative enterprises which are large and well organised, especially the general purposes co-operatives, which most of our co-operatives are, and they should be given an impetus. Through co-operation we should be able to compete in a very dynamic way. There is still room for improvement and for the introduction of new co-operative techniques for Irish agriculture. Our farmers must be encouraged to continue to develop their lines of milk production and to ensure that Bord Bainne will always have top quality produce to dispose of and sell.

An interesting figure in the vexed milk question is that in the Community —I read this somewhere—we have 26 million cows and only 2 million are employed solely on beef production. The beef conversion scheme need only attract 4 million cows from the total to leave the Community with 6 million cows on suckling and strike a balance of production in the Community. This should not be a difficult problem. I look forward to the Minister announcing the regulations to encourage Irish farmers to transfer. The European Commission scheme was not successful over there and I doubt if it will attract sufficient numbers of Irish farmers to change over, even though in the Community there is a shortfall in the supply of beef. The fact that the Community is general is becoming more affluent and that people are using more beef, is adding to our problems.

I hope our Minister will avail of every opportunity to defend and fight for the continuance of the CAP. The mistake made in the past was that the Community employed mainly negative measures such as slaughtering cows to solve this problem. We must be more dynamic and the proposals we would welcome would be progressive and would encourage people, by financial inducements, to change their line of production from milk to beef. If the new conversion scheme is attractive to Irish farmers the Minister can rely on the wholehearted co-operation of the people in that section of the community. I hope that there will be as little disturbance as possible in Bord Bainne and that the staff who were successful will be retained.

I am happy to note that an air of co-operation is developing between Irish bodies in Brussels. The COPA people, ICMSA and associated bodies, Bord Bainne, and the IAOS, have their European headquarters in the same office block and to an extent share the same facilities. This is a most desirable development. The Minister should encourage this development. He should also avail of the first opportunity to introduce legislation which will strengthen the IAOS as a co-ordinating body of the co-operatives because I think it is on co-operation that the success of our efforts in the agricultural field will depend in the years immediately ahead.

This organisation has been underfinanced over the past years. They must be given the opportunity and the finance to continue to provide, through the spirit of co-operation, the kind of atmosphere and outlets we in the agricultural community require if we are to compete with the larger and more powerful nations. The Minister has given us a very concise resumé of the Bill in his Second Reading Speech and for this I am deeply grateful to him.

Notice taken that 20 Members were not present; House counted and 20 Members being present,

Mr. Wilson

From listening to the Minister I understand that this is a kind of musical chairs Bill. In other words, we are moving, because we have to move under EEC regulations, from Bord Bainne, with a monopoly export position, to a new co-operative. The Minister obviously desires that the new co-operative will perform voluntarily functions as near as possible to those performed by Bord Bainne under statute.

I agree with the Minister that this is important, particularly in order to obtain quality control of export profits. This was the achievement of Bord Bainne. I come from an area where the dairy co-operative movement was started many years ago. I often wondered why they emphasied production and paid little attention to marketing. The marketing of Kerrygold butter reflects credit on all concerned. It is of little use to produce if one is not able to sell in the modern mode.

During the last two weeks I had a question down to the Minister. He did not take too well to it. He was a bit sharp when he was replying. I was suggesting the possibility of paying for butter on protein content. Some research has been done, as the Minister was aware; he referred to it in his reply. Butter came under fire from modern marketing techniques. People were shown the kind of figures that I have here and told that they must not eat butter, that there are alternative products. The emphasis on protein content of butter could be achieved by the producer being paid for protein content. This would help in marketing. A great deal more research must be carried out. It might be difficult to arrive at a unit of measurement. Apart from payment on protein content, the protein content could be emphasised in advertising and selling butter.

The Minister referred to the fact that some people, groups, companies and co-operatives, have not as yet agreed to participate in the new co-operative. I should be pleased if he would indicate the total production covered by the groups that have not as yet agreed to participate. The figure could be based on volume or value. I am sure the Minister is using his considerable resources and persuasive powers to get them all in. I hope he succeeds.

The Minister referred to the assets of Bord Bainne and said that these assets were financed by the former levy on milk supplied to creameries. The House would be interested in knowing whether these assets were exclusively generated by the levy on milk supplied or if there is an element of State subsidy in them.

I am glad that the position of the employees has been covered and their superannuation rights have been guaranteed. Also, the Minister has very wisely decided to guarantee borrowings up to £20 million for a period ending in 1977 when he thinks, showing his confidence in the new board, the board will have established itself as a creditworthy co-operative.

The Minister is very conscious of our position in the EEC. He has talked about diversification. The efforts being made in this regard are laudable. One thing we all owe to him and to the country, if we are to be regarded as having any word at all, is 100 per cent support for the common agricultural policy. The Minister referred to it. In various ways and by various devious methods the common agricultural policy is under attack. There are countries whose interests are not well served by this policy. For that reason the Minister will have to be more eloquent, not merely in Ireland but in other countries also, to see that people who traditionally have had an interest in maintaining food at low prices do not do so at the expense of our producers as they did for a long period.

Mr. Callanan

I should like to congratulate the Minister on this Bill. It is only fitting that I should say a few words on it because I spent my life in the co-operative movement and in trying to get the movement going in my area where it had a bad taste years ago. I am delighted that the co-operative movement is undertaking marketing. As Deputy Wilson said, we always produced but never took the product from the field to the consumer.

In passing, I should like to add my words of congratulations to Bord Bainne on doing an excellent job. The producers were not in a position to do it at that time. They are now in a position to do it. That is an excellent thing because nobody knows more about marketing than the producer. It is the producers who are being asked to do the marketing now. They have come together voluntarily. I am sorry that all the producers have not indicated their willingness to participate. Everybody is needed in the co-operative movement. I would ask the Minister to do his best in this regard. I always said, when speaking to small farmers, that their only hope of survival was in co-operation. In the present competitive world co-operation is needed.

The Minister has also said that, if anything goes wrong, he will have the power to dissolve the board. I congratulate him on that because we would need to be careful that when co-operatives like this are appointed they do not make rules which would mean that nobody could put them out. In my early days there was a problem about getting into co-operatives. They were run mainly by families and in the early days of Macra na Feirme we were trying to get in and we found that only a certain number of members retired each year so that one would be an old age pensioner before one got in. After that we made it very democratic and in many of the co-operatives of which I have been a member all the members retired each year. If they were good they were reelected and if not they were told to go home. I should like the Minister to keep an eye on this. When co-operatives come together to form a big marketing co-operative, they are inclined to rule that only a certain number retire each year. The Minister should make sure that co-operatives are completely democratic and that they do not become republics. The Minister and each Member of this House must go to the country and give an account of his stewardship. I have great respect for the IAOS. I have been associated with it for years. It did an excellent job. The co-operative movement had an uphill battle but it is well-established now. I should like to see it remain democratic so that the ordinary shareholder would have the say he has had down the years. We brought about that democracy. There is a tendency to diminish democracy in the interests of efficiency and streamlining such organisations by having only a few retire each year. In that way it would take a long time to remove a committee and this would be bad for the co-operative movement. The workers should be, and they are, looked after.

I am very proud indeed after about 30 years trying to get the co-operative movement on its feet—I am a member of a number of them—to see the Minister handing over the marketing of our dairy produce to a co-operative. I always said that anybody who produces anything should have a say in the marketing. Nobody knows better how to market his produce than the producer.

Mr. Hegarty

I should like to compliment the Minister on the Bill and on his performance generally in the House. He has shown great vision since he took office. I should like to compliment Bord Báinne on their performance in the past. They have done a very good job. They have shown vision when vision was needed, not that it is not needed now, but they took on things that a more conservative group would have fought shy of. I was involved in one small project, taking on frozen cream. At the time some people said it was lunacy but it was done and from a small market of 100 tons they have now brought it up to something in the region of 1,500 to 2,000 tons. This is significant at a time when there is a problem about selling butter and other dairy products.

I have no worry at all about handing over to a co-operative. We have an outstanding example of a co-operative in IMP Cork Marts. I have no worry about what farming people will do and how the body will operate. I am sure they are sufficiently business conscious to do what is right for themselves and I am delighted they will have an opportunity of doing it. I would not be too concerned about rules either. I think they will make the right rules.

Perhaps it would be an opportune time for the Minister to look at the marketing of all our agricultural produce. Perhaps it would be possible to tie in the marketing of our butter and dairy produce with other agricultural produce such as meat and processed vegetables. We have a really good brand name abroad in Kerrygold and this could be used for all our products. We are a small country with a limited number of top-class personnel to do the selling for us and it might not be a bad idea to co-ordinate our marketing team abroad to do the whole job. There would be the added advantage that, if one product was having a rough time, we could use the better products to sell the weaker one.

We know there is a protein scarcity at present. The Minister is conscious of this. I should like to see something done through the new Bord Bainne with regard to the use of whey as a source of protein. The Americans have developed this to a fine art. It is comparatively cheap protein as compared with soya and other things. Perhaps the new board would encourage somebody to start a new plant for the manufacture of protein from whey.

I wish the new board well. I am not too worried about diversification. We will need a lot of dairy products at all times and mountains of butter have a habit of disappearing overnight. We are one of the best, if not the best, country in Europe for the production of butter and milk. We should continue to do so.

Mr. Clinton

I should like to thank Members of the House for their very constructive contributions. This, of course, is not a controversial measure. Obviously, it is a measure that is agreed by all Members of the House and one that is regarded as being very desirable. It is obvious, also, that the Members generally appreciate the importance of the milk industry to the economy as a whole. Many Members have stressed the importance of the economy as a whole. Many Members have stressed the importance of the maximum amount of co-operation in the whole field of production, processing and marketing. Most speakers, too, paid a well-deserved tribute to the work done to date by the statutory Bord Bainne. I wish to add my tribute in this regard. Bord Bainne have introduced our milk products to almost every part of the world and they have set up a marketing and promotional organisation that has been very valuable and which will be even more valuable in the years ahead.

I was asked by a Deputy what percentage of production would be represented by those who are not prepared to co-operate with the new Bord Bainne. I would not wish to put a figure on that but would say that the proportion is very small. It would be my hope that it is a proportion that will not only diminish but will disappear entirely. The atmosphere has improved very much recently and it is my belief that those who are considering this matter in the short-term regarding any advantages that might accrue to them by reason of selling a product at a given time will realise very soon that the scale of operation is very important and that centralised marketing on the biggest scale possible is the right course to follow.

We are discussing an extremely important industry and it might be no harm to put on the record what is the extent of that industry now. The total supply of milk at present is 565 million gallons, the number of creamery milk suppliers is 90,000 and the total amount paid by creameries to milk suppliers is £68 million. These are 1972 figures. The total value of exports of various products amounts to £53 million. Of this, butter accounted for £18 million, cheese for £12 million and chocolate crumb and milk powder for £9 million each. Therefore, the industry is a very large one and we must do everything possible to assist it. What we are doing today is an important move and that is why I am glad that it has received the general support of the House.

There appears to be some confusion in one area. Deputy J. Gibbons and some other speakers also referred to the retention of the power to dissolve the board. The power to dissolve relates to the statutory board and not to the new board which is purely a co-operative that will be controlled by the milk producers. My wish is that the producers will increasingly take control and responsibility for their own business. For far too long there were other people conducting their business, but the producers have now reached the point where they can organise their own business and conduct it. I would not wish to retain the power to dissolve the new organisation, which I believe will take over this job on a co-operative basis and will carry it out very successfully.

Deputy J. Gibbons expressed concern about developments in the Limerick area in respect of Lansdowne and of my publicly expressed intention to transfer as soon as possible the work of the Dairy Disposal Company to the co-operative societies. I think that the Deputy, too, is in favour of this sort of development. I know that when he was in office he decided to deal with the Limerick situation in a certain way. At this point I am not prepared to say that that was a wrong decision but I am endeavouring to see whether, in the one move, we could achieve what the previous Minister was trying to achieve and, at the same time, pass this responsibility to the co-operative societies. If that should not prove possible, I intend to continue along the lines which the Minister had arranged. The Government should get out of this type of production as soon as possible. Perhaps Deputy J. Gibbons would agree with me on that. I assure the House again, as I have done on previous occasions, that the position of the staff both at Lansdowne and the Dairy Disposal Company will be protected, that nobody will lose his employment as a result of any decisions we may make.

I think it was Deputy McDonald who raised the question of the signifiance of subsection (2) (b). This provision is intended to cover pensions of the board at the 1st February, 1973, as well as persons still employed on that date which, of course, was the date of the application of the EEC agricultural regulations when the board's export monopoly had to end.

Most speakers mentioned the need for diversification and for a search for new products that would command a greater price for milk. That is a matter on which we must all agree. A couple of weeks ago an excellent article appeared in The Farmers Journal about the importance of investment in product research and marketing. As a result of the prices secured for milk in the EEC, our producers are now getting very good prices for milk. Of course, there have been substantial increases in milk prices in the past couple of years. Farmers must realise that investment in research is very important, research not only in a new range of products that would guarantee them a higher price for milk but in marketing and related matters which would, in the last analysis, affect the overall prices they would receive for milk.

Mr. Wilson

This is a question of education.

Mr. Clinton

Yes. Deputy Wilson spoke of payment for milk on the basis of protein rather than fat content. He said that, when he raised this matter by way of parliamentary question, my reply seemed to be rather sharp. Perhaps the Deputy got this impression from my manner of speaking, but I can assure him that I did not intend the reply to be in any way a sharp or a smart-alecky one. What I said was that, if there was a demand from the industry for a change to milk being paid for on the basis of protein rather than fat content, I would go along with that demand; but that demand has not come from the industry. Nowhere that I know of has this been done. I see the importance of trying to change over to a system which would give us less butter and more proteincontent food. Somebody said that the CAP was being threatened. If anything is seriously threatening CAP it is surpluses of the type referred to —we have too much butter. I certainly would not resist any approach from the industry in relation to a change—to selling on the basis of protein rather than fat.

I think it was Deputy Gibbons who said that the Irish production represents a very small proportion of total EEC production. Of course, I agree with him. One speaker at least, I think it was Deputy McDonald, spoke about the importance of inducing farmers to accept the conversion schemes put up by the EEC. I am afraid I have to disagree with my colleague on this. There is no farming enterprise, no grass enterprise in this country, paying anything like the dividends that milk is paying. I do not think that is a good scheme at all and I would be very loath to recommend it to Irish farmers.

The best possible way for farmers to pull themselves up by their shoestrings at the present time is by milk. Indeed, I have been quite surprised at the number of applications from farmers, former milk producers, for the beef scheme. It may be that some of the farmers at this level of production see no prospect of becoming economic producers and have given up the ghost. I think it would be far better if more of them had more confidence and showed more confidence and tried to get their dairy herds up to the level of viability in milk. That is the source that will give them greater income. If I went on in this vein I might be ruled out of order, but if there is any Member who feels I have not dealt with any point he has raised perhaps we can come back to it at some later time.

Mr. Wilson

There are only two questions I wish to ask. I know the Minister has done a good job on the percentage of non-participators but he did not tell the House, even roughly, the percentage.

Mr. Clinton

I would say the percentage would be below 20 per cent. I would be very slow to put a figure on it.

Mr. Wilson

There is then, the question of the assets.

Mr. Clinton

I am sorry, I forgot to reply to that query. The assets are all the produce of the levy, plus appreciation of assets during the years.

Question put and agreed to.