Vol. 402 No. 6
1 Mr. Connaughton asked the Minister for Agriculture and Food the special steps the Government have taken to inform other EC member states of the implications the present GATT negotiations will have for Ireland; if the Commissioner MacSharry EC proposals will hurt Irish agriculture more than any other EC member state; and the measures, if any, which are still at his disposal to protect Irish farmers from being unduly penalised.
6 Mr. Deenihan asked the Minister for Agriculture and Food the provisions which the Government will make for those farmers who will be forced out of agriculture as a result of the proposed 30 per cent cut in EC subsidies.
9 Mr. Byrne asked the Minister for Agriculture and Food if he will outline the likely impact on Irish agriculture and farm incomes of the agreement on farm cuts reached by EC Ministers at their meeting on 6 November, 1990; and if he will make a statement on the matter.
11 Mr. Durkan asked the Minister for Agriculture and Food if he has satisfied himself that the present direction taken in the GATT negotiations will ensure that Irish agriculture and the agri-industry will not in any way be placed at a trading disadvantage; if he has quantified the impact of these proposals on the industry; and if he will make a statement on the matter.
24 Mr. Barry asked the Minister for Agriculture and Food whether the Government agreed to the proposal of the EC Commission that overall farm support be cut by 30 per cent of the 1986 level, by 1996; and if he will make a statement on the matter.
30 Mr. Dukes asked the Minister for Agriculture and Food if it is intended to reopen the matter of the GATT negotiations at the next meeting of the European Council.
I propose to take Questions Nos. 1, 6, 9, 11, 24 and 30 together.
The Uruguay Round of trade negotiations commenced in September 1986 when almost 100 GATT contracting parties agreed, inter alia, to bring greater liberalisation to world trade in agriculture. This agreement specifically involved a commitment to reduce import barriers and to improve the competitive environment by increasing discipline on the use of all direct and indirect subsidies affecting agricultural trade, including the phased reduction of their negative effects. The European Community is a party to this agreement and has thus been committed to reducing support and protection for agriculture since that time. Ireland, represented by the then Minister for Education, former Deputy Paddy Cooney, was a member of the Community delegation who participated at the meeting in Punta del Este at which this agreement was reached.
What is now on the table is the precise outlining of the European Community's final position elaborating on a number of more general Community statements made in the intervening negotiating period and all stemming directly from the 1986 commitments.
The firming up of the Community's final position began with the suggestion by Commissioner MacSharry at the informal QUINT meeting in Ireland in late July that the Community would be prepared to commit itself to a 30 per cent reduction in aggregate support over the ten year period from 1986. At that time I indicated the strongest possible reservations about the extent of the cut unless it was framed in a way that protected the principles and mechanisms of the CAP and was accompanied by clear guarantees in regard to offsetting complementary measures. Much of the discussion since then has centred on these precise issues.
The Commission put forward its formal proposal on 5 October. This provided for a 30 per cent reduction in support over the ten years from 1986, measured by an aggregate support measurement unit. The proposal also involved the conversion of the current import levies into tariffs, which would also be subject to the 30 per cent reduction. The tariffication proposal was subject to certain conditions including the securing of increased protection against cereal substitutes and other products but only in respect of quantities well in excess of current supply levels. There was also some implied degree of ambiguity about whether separate concessions might be considered in regard to export refunds. The proposal was accompanied by no commitment to complementary measures.
The Council finally reached a decision on the proposal last week after protracted discussion at seven meetings over four weeks. Significant changes were made in the proposal I have referred to in order to secure agreement: (a) the position that the community's approach is global, that is individual policies cannot be singled out, has been reaffirmed and, in particular, there is a specific Council statement that any separate undertaking on export subsidies would be incompatible with maintaining the fundamental principles of the CAP; (b) a major amendment allowing for a modification of the rate of reduction in border protection was accepted by the Commission which adds greatly to assurances that Community preference against imports will be maintained in the future; (c) the Community's offer is now conditional on equivalent commitments being undertaken by others; (d) any further adaptations to support arrangements that may be necessary will take account of, in particular, the difficult situation of certain categories of producers and certain regions. In particular, the Commission has stated that it considers that the total level of assistance to the less favoured regions should not be reduced as a result of the implementation of the outcome of the Uruguay Round negotiations. This is a particularly important declaration for Ireland given that 58 per cent of Ireland is already classified as "less favoured" and this will be increased to about 72 per cent when Community approval is secured for additional areas; (e) effective protection against imports of cereal substitutes, oil-seeds, etc. will now be secured for quantities above recent average imports. Under the Commission's original proposal, effective protection would only have commenced at average 1986-88 levels plus 8 per cent; (f) the Commission has also undertaken to submit rapidly concrete proposals, supported by appropriate financial solidarity, to ensure a viable future to Community farmers based on inter alia reorientation of support to producers taking as a basis the diversity of the structure of farms and production; reinforcing structural assistance, including production neutral income subsidies, concentrating on producers and regions which have most difficulties in adapting to changes and measures to protect the environment and to improve product quality; (g) the Commission may change the policy measures to be subjected to disciplines in the light of the offers made by other parties in the negotiations. This would enable the Community to exempt certain support measures from the disciplines being undertaken.
Given that it was already committed to defining its position for the concluding stages of the negotiations for agriculture, the Community was obliged to submit an offer at this time. While I would have preferred a less ambitious approach, I believe that considerable safeguards have now been built into the offer which the Community submitted in Geneva last week and in the associated Council and Commission declarations adopted by the Council on 6 November. The essential conditions which I indicated at the time of the QUINT meeting as being a prerequisite for agreement are largely in place. In particular, the safeguarding of the fundamental principles of the CAP, the special recognition of the areas and groups of farmers which could be worst affected and the clear commitments to complementary measures are all especially important. Ireland was among the member states that fought hardest and most successfully for these improvements. Nothing would have been gained — indeed many of the advances would have been lost — by holding out for any longer.
The GATT negotiations are now in a critical phase. The community has, in my view, put forward a realistic offer consistent with the international commitments entered into at Punta del Este in 1986 and recognising the realities of agriculture in the EC. It should ensure that agriculture and the agri-food industry in Ireland and in the Community remains viable and that farm incomes are adequately supported though, perhaps, in a different manner to the one we have been used to up to now. A successful and balanced conclusion to the GATT round should ensure a much more stable agricultural trading environment in the future than has obtained in the recent past. In the long run this more stable environment should, provided the undertakings given are honoured, allow for the continued development of our agri-food sector.
Given the commitments entered into in 1986 and subsequently, what we have now tabled is clearly the best that we could reasonably put forward. If adopted it would provide the basis for a balanced outcome. That put forward by some other contracting parties would not. All our efforts must now be applied to ensure that any final agreement in the GATT is on the basis of our approach. That particular aim would not necessarily be advanced by having the issue raised again in the European Council, the next meeting of which is, in any event, after the dates set aside for the critical ministerial meeting on the Uruguay Round.
Will the Minister explain the logic of statements made by him and Commissioner MacSharry that there could be a drop in farm subsidy prices of 30 per cent and still tell farmers they were going to be all right? Will he explain the logic of that to me after that long rigmarole of an answer he has given? Can he explain how the 40,000 farmers most vulnerable at the moment could believe their future is secure after the deal he made in Brussels last week?
I regret if the spokesman on Agriculture and Food, or any member of this House, would regard a comprehensive reply to seven questions as a long rigmarole of an answer.
Because the Minister——
I hope I will have the opportunity to reply to reasoned questions.
Will he tell us where the 40,000 farmers will go?
The Deputy has failed to understand the implications of the process which started in 1986 when he was in Government and were represented by their Minister for Education.
Please, Deputy Connaughton.
I reject entirely——
The Minister wrote the redundancy notices of 40,000 Irish farmers and he will not answer straight and to the point.
Deputy Connaughton, let me say again that the questions before us are priority questions for which 15 minutes is provided under Standing Orders. Already these questions and answer has taken up nine minutes of the time allocated.
The Minister's answer was a long one.
It is up to yourself Deputy.
I am in your hands, a Cheann Comhairle.
Minister, I want to deal with the other two questions also.
I am ready to give a reply to Deputy Connaughton. I reject the fact that Deputy Connaughton has suggested, and suggested constantly, that we did not conduct these negotiations effectively. I reject his suggestion that I should have vetoed the negotiations because the implication of that — which Deputy Connaughton clearly does not understand and everyone else does — is that the Commission would have gone ahead with the original proposal with none of the protections we have built in. If Deputy Connaughton does not understand that he understands nothing.
Could the——
Next question please, No. 2, by the same Deputy.
