I realise that but they are separate items and I am entitled to discuss both of them. I am availing of the opportunity of speaking against item No. 11 on today's Order Paper which is only now being introduced because it serves as an opportunity to underline my party's very strong opposition to the proposition that levies should be introduced. Item No. 11 is a separate item from the Bill.
I am very strongly opposed to the concept of a levy for a number of reasons. This levy is being introduced to finance disease eradication and is one of a number of levies being introduced at present by the Government. We had the 2 per cent levy which is being imposed across the board to finance general Government expenditure without any excuse being given, notwithstanding the fact that it is accepted by anybody with a reasonable knowledge of economics that a levy on production is the least effective and the least fair way of raising money because it is indiscriminate.
This levy is paid whether or not people are making a profit. It is paid by all people whether they have an income which would put them in the tax net or not. We now have this bovine diseases levy. We had another increase in fees charged at exactly the same point for nearly the same purpose, the increase which took place last year in the veterinary inspection fees, again introduced by this Government. On today's Order Paper we have another fee being introduced for the first time—the dairy inspection fee. This service was carried out in the interests of public hygiene at public cost in the past and is now to be paid for by the farmer in the form of a levy. The important thing to remember is that this levy is unfair because it bears no relationship to ability to pay or to whether the person paying it has an income which would be taxable.
In certain circumstances in the case of meat this levy may be paid by the consumer. Where demand exceeds supply—we are talking about heifer meat which is used on the domestic market and is different from bullock beef which is usually exported—the butcher is forced to pay a price which is inclusive of the levy. In other words, he pays the levy, not the farmer as was intended. This bovine disease levy, in addition to the 2 per cent levy, can in certain circumstances—and I make this statement quite categorically—of demand exceeding supply be a consumer levy.
What is causing concern in respect of this levy is that it is permanent. The 2 per cent levy will not be permanent but will be replaced by another equally unpalatable form of taxation. There is no indication as to the length of time it will continue. It could continue forever. It could continue beyond the time when tuberculosis and brucellosis has been eradicated. There is nothing in the Bill which says that this levy will cease to be paid as soon as the disease in question have been eradicated. There is no means of cutting off the levy at that point. Furthermore, there is no proper provision made as to how the levy will be used. It could be used for purposes other than disease eradication. There is nothing in the Bill which would require that the levy be paid into a particular fund where it would be kept separate from other Government funds. This levy could be used for different functions than disease eradication. At some future time it could happen that only a small amount of money would be needed for disease eradication but three or four times as much money was collected by this levy and it could be applied for purposes totally unrelated to disease eradication. There is no guarantee that this levy will be used as it should be, that is solely for the purpose of disease eradication.
As far as the development of our agricultural economy is concerned, the introduction of this levy, in common with the other levies, could not have come at a worse time. We are at a point where farmers' confidence is, in the opinion of many people outside this House, at a lower level than it has been at any time, certainly since 1974 and perhaps since long before that.
In the recent price negotiations at Brussels there has been what amounts to a virtual price freeze—a 1½ per cent increase in prices at a time when costs to farmers have been increasing at not 1½ per cent but about ten times that amount. Farmers also have to pay much higher interest rates on their borrowings as a result of changes made in the bank rate in the recent past. People on all sides of the House have encouraged farmers to invest and borrow substantial amounts of money. They now find their interest rates are increasing at a time when the prices they are getting for their products are being increased by only 1½ per cent for most commodities and nil for milk which is the one line of production from which our small farmers had been able to make a reasonable income in the past.
At this time when, on the one hand, farmers are being squeezed by a small increase in the prices they are receiving for their goods and, on the other, by increased costs for inputs and interest charges, the Government deem it right to introduce not one levy but four different levies—a 2 per cent levy across the board, a 1 per cent levy for bovine disease eradication, increases in fees for veterinary inspections and the introduction of a fee for the inspection of dairy products. I do not believe any Government which have the interests of Irish agriculture at heart would have taken these actions.
I want to point out to anybody who believes these measures are fair and just that if they result, as I believe they will, in accelerating the decline in farmers' confidence, the consequences will be felt not solely by the farming community. The number of cattle being sold to our meat factories will decline if farmers cannot make a reasonable profit on sales of cattle. Already our factories are slaughtering at about only half of their full capacity. The factories are having to pay overheads and to maintain buildings and staff and yet they are slaughtering cattle at only half the rate that they should be if the cattle were being supplied to them. Our meat industry is working at half-cock and that is endangering the employment of people engaged in that industry.
The effects of the agricultural depression in so far as they affect employment in the meat industry are reaching right into the centre of this city. A very substantial meat plant is located in Grand Canal Street. That plant will be affected because this levy will reduce the profitability for farmers supplying meat for slaughter in that plant and indirectly will affect employment in that industry. Also over the past eight or ten months there has been a remarkable decline in the number of cattle being exported from this country in the form of beef carcases. If my figures are correct, in the past eight months fewer cattle have been exported dead from this country than were exported in the same months last year. This is the very time that this Government decide to accelerate that process by introducing a 2 per cent levy and now this disease levy, to make it even less profitable in the future than it was in the past for people who were already sending fewer cattle to the factories. Surely no policy could be less wise in the interest of this country than one designed to accelerate a process whereby the number of cattle being slaughtered for export is falling.
Further, the levy which it is proposed to authorise in the Financial Resolution will be paid on an animal regardless of its value. If you send for slaughter a pedigree animal which is of very high value—say £1,000 if such were possible—you will pay £3. If you send an animal to the knacker and you get only £5 for it, the animal is useless but apparently you will still have to pay £3 levy on that animal. Furthermore, this levy would have to be paid on reactors. If you have to get rid of an animal because it is a reactor for which the Government have decided you must be compensated, and the Government are paying this compensation, they will be handling the compensation to you with one hand and taking it back, in the form of the levy, with the other hand. Could anything be more ridiculous? The Government are giving a man compensation because he has to have his animal slaughtered and then they are taking the money back from him in the form of a levy on the slaughtered animal.
This is a good example of what could be called circular payments, with administrative time being used up collecting money with one hand and giving it out with the other and leaving the farmer in exactly the same position as he was. We have a levy on the very animal for which compensation is being paid at the same time for exactly the same transaction. This is all creating employment in the public service administrating the compensation scheme on the one hand and the levy scheme on the other. Could anything be more ludicrous? It surprises me that reactors have not been exempt from this levy. In the case of the 2 per cent levy, which admittedly is only temporary but very objectionable, reactors have been exempted but they are not exempted from this one. If there was a case for exempting them from any levy it surely should be from the levy being charged for the purpose of eradicating a disease to which they have reacted and for which reaction compensation is being paid. Yet, under the Bovine Diseases (Levies) Bill the levy is being charged on reactors and it is not being charged under the 2 per cent levy. This is a very anomalous situation, to say the least.
I have made these points in respect of the levy itself. On this resolution I do not wish to deal with the provisions of the Bill and some of the collection powers being taken. However, I will make one concluding observation in relation to the resolution. The purpose of this levy is not specified clearly anywhere, but it is ostensibly to pay for the cost of disease eradication. Disease eradication is primarily a matter of public health and is of concern to the entire community because these diseases can and do spread to humans in certain circumstances. They are known as zoonoses. I will spell it for the Minister if he wishes me to do so.