I move that the Bill be now read a Second Time. Under the National Stud Act, 1945, a company named Colucht Groighe Náisiúnta na hÉireann, Teoranta (the Irish National Stud Company, Limited), was set up by the Minister for Agriculture in April, 1946, to carry on, in the interests of the Irish thoroughbred breeding industry, the business of stud farming at the National Stud Farm, Tully, Kildare, or on any other land held by the company. An annual licence to use and occupythe National Stud Farm for this purpose has been granted to the company by the Minister each year since 1946.
Under Section 11 of the 1945 Act, the share capital of the company is limited to £250,000, divided into shares of £1 each. The shares are allotted and issued to the Minister for Finance from time to time according as capital is required by the board of directors. The share capital so far issued amounts to £190,880. This will shortly be increased to £194,130, leaving the amount of share capital unissued at £55,870.
Since 1946, the company have, from time to time, acquired a number of sires and valuable brood mares. The stocking of the National Stud has, however, not yet been completed. The board of directors have been emphasising for some years past that to ensure a profitable future for the company the purchase of a staying sire of the highest class would be needed. Horses of this type are much needed in this country in order to develop the export trade in thoroughbred horses. Some additional brood mares of the highest class are also required to supplement the stock at the National Stud.
Realising that the balance of the share capital unissued would be altogether inadequate for the achievement of these aims, the board of directors have been pressing for some time past for a considerable increase in the authorised share capital of the company.
After full and careful consideration of the financial requirements for the proper development of the National Stud, the Government approved the preparation of a Bill to amend the National Stud Act, 1945, so as to raise to £500,000 the limit of the share capital of the company. This is the main purpose of the Bill now before the House. The Bill also deals with one minor matter, namely, that on the suggestion of the board of directors of the company, the Bill proposes to repeal Section 26 of the 1945 Act, which section has been found to be unsuitable in practice, and to replace it by the more flexible provision set out in Section 3 of the Bill.
The enactment of this Bill is now urgently necessary following on the recent acquisition of the company of a very valuable horse named Tulyar.
It is necessary to point out that for some years past, the directors of the Irish National Stud Company have been assiduously searching for a suitable staying sire of the highest class. As far back as July, 1951, the company were informed that if they purchased a suitable horse, the price of which involved them in expenditure in excess of the company's unissued share capital, the authority of the Government would be sought for the preparation of a Bill to increase the share capital limit of the company. After further representations from the company, and following correspondence between the Department of Agriculture and the Department of Finance, the authority of the Government was obtained on the 1st July, 1952, for the preparation of a Bill to increase the share capital of the company. This was long before the purchase of Tulyar was thought of. The point of these remarks is to emphasise that this Bill would have been necessary anyhow in order to enable the company to proceed with their programme for properly stocking and developing the National Stud.
The breeding of horses in this country is a long-established national industry. The net value of the export trade in horses in 1951 exceeded the £3,000,000 mark. Furthermore a substantial proportion of these exports go to the dollar areas. Exports to these areas in recent times averaged about £200,000 per annum.
The possibility of expanding our export trade in horses, and particularly to the dollar area, has been obvious for some time. It has, however, been realised that, in order to expand that trade, horses of the highest standard must be produced. The Government had this in mind in setting up the National Stud Company in 1946. It is, therefore, the duty of that company to operate a policy designed to develop the industry from the national aspect rather than from the narrower aspectof an ordinary company or private individual.
The essentials for success in the breeding of thoroughbred stock are good soils, suitable climate, skill in management, and good breeding stock. In the first three of these, i.e., soil, climate and skill, we are second to no country in the world. In the fourth, i.e., breeding stock, our position can be substantially improved. There is, for instance, at the moment the need for more extensive production of really high-class thoroughbreds of the longer distance or staying type. This fact is fully realised by all those interested in the industry. The National Stud Company is obviously the organisation best equipped to bring about this improvement. In the purchase of Tulyar they have very definitely taken a step in the right direction and one of which the Government and all others interested in the development of the industry heartily approve.
The price the company has agreed to pay for Tulyar is admittedly high, but considered from the national point of view it must be regarded as a perfectly sound investment. A stallion of this sort would, on the average, remain in service for a period of 12 years. The price of £250,000 to be paid for the horse should therefore be spread over a period of 12 years and would amount to approximately £20,000 per year. As already stated, the net value of our export trade in horses is about £3,000,000 per year. The purchase price of Tulyar when extended over the 12 year period is therefore a very small item as compared with the value of our export trade. In fact the outlay on this horse actually amounts to only two-thirds of 1 per cent, of the total export value of our horses for 12 years at its present level. While there is, of course, a certain amount of risk involved in this purchase, this risk is small as compared with the great possibilities it opens up for the expansion of the industry.
Apart from the national aspect of the purchase of Tulyar by the National Stud Company, there are of course compensating factors for the stud itself. The earning value of Tulyar atstud is estimated at £16,000 per annum, and may possibly go as high as £20,000 for a period of 12 years. Furthermore the National Stud Company has some ten very high-class brood mares, some of which will be mated to Tulyar. The female progeny of such matings will be extremely valuable stock to retain at Tully for stud purposes. Those not required for this purpose and the colts from such matings, when offered for sale, will undoubtedly fetch very high prices.
We are in the fortunate position of having secured a very high international reputation for the quality of the race horses we produced. The produce of Irish studs have over the years won the most valuable races in very many lands, including all the English classics and the most important races in the U.S.A. In the latter country thoroughbred breeding has in recent times reached an extremely high level, largely due to the fact that breeders in that country purchased from the Aga Khan some years ago three horses: Blenheim, Mahmoud and Bahram. The three horses in question were bred in the Aga Khan's studs in County Kildare, and during their racing careers before export all three had won Epsom Derbys as well as other very important races. Both in racecourse performance and pedigree Tulyar is definitely a better horse than any of the three. For that reason American breeders showed great anxiety to secure Tulyar for their studs. In view of the American interest in the horse we may anticipate very keen demand from that country for his produce when it comes on the market a few years hence.
Apart from the valuable export trade in horses stud farming has a high labour content; the output per acre is much above average and furthermore the produce in the form of thoroughbred horses is an excellent dollar earner. As regards labour, a review of some of our leading studs has shown that one man is employed for each 20 acres or so, where in farms of 200 acres and upwards over the country as a whole one man is employed on each 42 acres. The review has furthershown that the earnings of a stud farm through service fees and yearling sales amount to upwards of £30 per acre as against £12 per acre in output over the country as a whole. In addition to the earnings from horses there is, of course, on our large studs a considerable turnover from cattle feeding. Furthermore stud farms purchase very large quantities of oats, hay and straw, and at good prices, from farmers in the surrounding districts. The total amount paid for such items at some of our leading studs would run from £10,000 to £20,000 per annum.
Racing is of course closely associated with breeding and is also a valuable source of employment. There are at the moment over 2,000 horses in training with a labour content of 1,200 to 1,400 men. In one large racing establishment the wage bill amounts to upwards of £12,000 per annum, while the purchase of forage amounts to an almost equal sum.
The values of high-class horses for stud in recent years have been about £120,000 to £160,000. The horse Nasrullah, sold for export after having been used for some years for service here was about the latter sum. The horse, The Phoenix, was syndicated at home at about the same sum. The Aga Khan's horse, Palestine, a good winner for distances not exceeding one mile, is syndicated here at £120,000. The only horse in Europe that approaches Tulyar to any extent in merit is the French horse, Tantieme. This horse is now at stud in France at a fee of £600 which amounts to an earning capacity of £24,000 per annum. While his racecourse performances are really good, his pedigree falls entirely short of that of Tulyar.
As already mentioned, the enactment of this Bill is now very urgent and I commend it to the Dáil.