I move:—
That a supplementary sum not exceeding £1,505,000 be granted to complete the sum necessary to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1953, for the Salaries and Expenses of the Office of the Minister for Agriculture, including certain Services administered by that Office, and for payment of certain Subsidies and sundry Grants-in-Aid.
The Supplementary Estimate is for a sum of £1,505,000 and is made up as follows:—
£ |
|||
Sub-head |
G.5—Repayable advances for Impor- tation of Superphosphate |
555,000 |
|
,, |
M.9—Land Rehabilitation Project and Water Supplies |
500,000 |
|
,, |
M.10—Ground Limestone Subsidy |
150,000 |
|
1,205,000 |
|||
Add:— |
|||
Sub-head |
Q.—Appropriations-in-Aid: Deficiency in Receipts |
300,000 |
|
Sub-head |
G.5—£555,000 |
TOTAL |
£1,505,000 |
,, |
Q (Item 8) £300,000 (Deficiency) |
The bank agreed to permit an overdraft of up to £1,100,000 on the account of Comhlucht Siúicre Éireann to finance importations of superphosphate by the company on behalf of the Department of Agriculture provided that 40 per cent. of the overdraft was repaid not later than 30th June, 1952, and the balance not later than 31st December, 1952.
It was anticipated that there would be a carry over of unsold stocks at 30th June, 1952, and that these would not be disposed of until the latter half of the year. Accordingly provision was made in the original Estimates for the financial year 1952-53 (sub-head G (5)) for the payment of £400,000 to Comhlucht Siúicre Éireann to meet the proportion of the bank overdraft due on 30th June, 1952. Provision was also made in the Appropriation-in-Aid (sub-head Q) for the repayment of a like sum by Comhlucht Siúicre Éireann from sales of superphosphate.
Payment of the requisite proportion (£355,000) of the overdraft was made to Comhlucht Siúicre Éireann in June, 1952. Due, however, to a considerable falling off in the demand for fertilisers the anticipated sales of the stocks imported on behalf of the Department of Agriculture did not materialise, and it is estimated that the balance of the bank overdraft at 31st December next will be £600,000.
Repayments for sales of superphosphate by Comhlucht Siúicre Éireann have been similarly affected and it is now estimated that the amount received by way of Appropriations-in-Aid will not exceed £100,000 in the financial year ending 31st March, 1953.
Consequently it is now necessary to increase the provision under sub-head G (5) from £400,000 to £955,000 and to reduce the Appropriations-in-Aid under sub-head Q from £400,000 to £100,000.
Stocks of superphosphate on hands at present total approximately 55,500 tons of which 17,500 tons were imported under the 1950-51 contract and the balance under the 1951-52 contract.
As regards sub-head M (9)—Land Rehabilitation Project and Water Supplies—£500,000—it was estimated that the provision in the original Estimates of £2,033,906 for the land rehabilitation project and water supplies scheme in 1952-53 would be sufficient. Early in the financial year, however, it became apparent that expenditure on direct action work being carried out by the Department, and by contractors working for the Department, would be much greater than was originally anticipated. This was due to the fact that the demand by farmers for the facilities afforded under Section B of the land project became increasingly great and the volume of work carried out by the Department and by contractors was, therefore, greater than was anticipated when the Estimate was framed.
The additional sum of £500,000 now required relates almost wholly to the direct action work being carried out by the Department and by contractors working for the Department.
It was originally estimated that a sum of £180,000 would be required to meet the cost of labour recruited for the direct action work being carried out by the Department. In fact, the sum required for this service is now estimated at £350,000, i.e., an additional sum of £170,000.
In the case of the provision for payments to contractors, the original estimate was for a sum of £270,000. Expenditure for this service is now estimated at £510,000, i.e., an additional sum of £240,000. The third major item of expenditure on direct action work is in respect of the purchase of materials for drains, fencing, etc. The provision under this heading was originally estimated at £240,000. Revised expenditure is estimated at £320,000, i.e., an additional sum of £80,000.
The three additional amounts set out total £490,000 out of the gross additional sum required of £500,000. The balance of £10,000 represents an additional sum required for the purchase of lime and fertilisers.
This notable expansion in the work under Section B of the land project suggests that the time has arrived when it will be advisable to review the terms of the land project in so far as the benefits available to farmers under Sections A and B, respectively, can be compared. The fact that the project has been in operation for a period of about three and a half years also suggests the desirability of a general review of its progress.
Accordingly, a close examination of the relative merits of the two sections of the project is being made. Section A refers to that part whereby farmers carry out reclamation work on their holdings, in consideration of which they receive a grant calculated at the rate of two-thirds of the estimated cost of the work subject to a maximum of £20 per statute acre. Section B provides that farmers may request the Department of Agriculture to carry out reclamation work on their holdings, in consideration of which they are required to contribute towards the cost at the rate of two-fifths of the estimated cost, subject to a maximum of £12 per statute acre.
Experience has shown that the terms of Section B of the project offer much greater advantage to the farmers than do those of Section A, where the expensive types of drainage and reclamation works are involved. This does not apply in cases of minor and relatively unimportant types of work. The situation, therefore, has been created that the grant facilities of the project are being availed of only in respect of the minor and relatively unimportant reclamation works, while the Department of Agriculture is being requested to undertake all the expensive type of work. Naturally, with the limited machinery available to the Department and to contractors, progress has been slow. It is apparent, therefore, that some inducement will have to be offered to farmers to persuade them to undertake major reclamation works on their holdings, whether by employment of contractors on their own behalf or by employment of gang labour.
With this purpose, I have decided to recommend to the Government that the terms of the land project should be adjusted in order to equate the benefits available under both sections. I propose to recommend that the grant available under Section A of the project will be raised to a level which will ensure that the farmer who undertakes reclamation work on his holding on a grant basis will receive equal financial assistance. I hope to be able to announce shortly the increased grant payable under the project, and my intention is that the benefits will be available as from the date of the announcement, and will apply not only to applications received subsequent to the date of announcement, but also to existing claims which have not been certified as complete and eligible for payment of the grant already approved.
I hope that this increased financial assistance will induce many farmers to undertake reclamation work on an extensive scale on their holdings on a grant basis, thus affording some relief of the volume of work falling on the Department of Agriculture. This applies particularly to those farmers who prefer to see their land brought into full production without creating a debt on their holdings. More important still is the fact that larger areas of unproductive land will be brought into production more rapidly because farmers can have the work done more quickly by gang labour and by creating such a demand for land reclamation contractors as will bring more of these into existence.
The examination of the progress of the project generally discloses one other important fact. Contractors are able to carry out reclamation work more rapidly than can the Department through the operation of its own machinery. This is readily understandable when it is considered that contractors can work for longer hours, can be more selective in their employment of skilled labour, can retain such skilled labour irrespective of the areas where they undertake work and, generally, are not subject to the restrictions applicable in the case of machinery operated by a State Department.
With the object of having reclamation work speeded up, the Government has also decided that the machinery at present employed by the Department for the purposes of Section B of the land project shall be disposed of to private contractors.
Briefly, therefore, it can be stated that a sum of £500,000 is required in order that the programme of the land project in the current year may be carried through. With the amendments in the terms of the project which have been set out, it is hoped that the reclamation of land may be proceeded with and that greater areas of land will be brought into full production more rapidly.
As regards sub-head M (10)—Ground Limestone Subsidy—£150,000—in March, 1951, the Government approved of the expenditure of £1,750,000 from Grant Counterpart Funds for a five-year scheme to subsidise the delivery of ground limestone from the quarry to the farmer's premises. This amount was allocated over the five-year period as follows: 1st year, £250,000; 2nd year, £300,000; 3rd year, £350,000; 4th year, £400,000; 5th year, £450,000.
The scheme came into operation on the 12th March, 1951, and the total amount of subsidy paid in the financial year ended 31st March, 1952, was £198,000 approximately. This amount covered the delivery of some £238,000 tons of ground limestone in the period 12th March, 1951, to 28th February, 1952.
The increase in the demand for ground limestone has been much greater than anticipated and it is estimated that deliveries for the 12 months ending 28th February, 1953, will be approximately 550,000 tons and that the subsidy payable in the financial year 1952-53 will be £450,000, as against £300,000 provided in the Estimates.
The present average cost of delivery is approximately 16/- per ton. Any reduction which might be expected as a result of additional grinding plants coming into operation will probably be more than offset by the increase in the road tax on motor vehicles which comes into operation on the 1st January, 1953.
When the subsidy scheme came into operation in March, 1951, 16 plants were in production. Twenty plants are now working and it is expected that an additional two plants will be in production before the end of December.
The maximum output of the present plants is approximately 850,000 tons per annum.
Plans for the greater production and use of ground limestone are under consideration.