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Dáil Éireann debate -
Tuesday, 12 Nov 1963

Vol. 205 No. 9

Committee on Finance. - Vote 41—Agriculture.

I move :——

That a supplementary sum not exceeding £10 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 March, 1964, 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 purpose of this token Estimate is to enable the Dáil to discuss the 1963/64 Estimate for the Department of Agriculture. I propose also to move after the debate on this Estimate a further Supplementary Estimate in which the main item is £1,350,000 for the support of creamery milk prices. I will deal with this and the other items in the Supplementary Estimate in the course of this speech so that the debate may cover both the Main and Supplementary Estimates.

The total net Estimate for 1963/64 shows an increase of £4,973,590 on the original net Estimate for 1962/63, which amounted to £19,073,410. Including two Supplementary Estimate provisions for 1962/63, the final total Estimate for that year was, in fact, £24,563,910.

As compared with the original Estimate for 1962/63, the following subheads in particular show substantial increases: N. Marketing, etc., of Dairy Produce; K.15 Losses on Disposal of Wheat; K.14 Payments to Pigs and Bacon Commission; K.8 Lime and Fertiliser Subsidies; I.6 An Foras Talúntais; K.6 Farm Buildings Scheme. The only items of note which show a decrease compared with the original Estimate for 1962/63 are concerned with the Bovine Tuberculosis Eradication Scheme, subheads K.11 and KK. 11.

Deputies have received a memorandum entitled "Notes on the Main Activities of the Department" giving detailed information on the operations of my Department and on various trade and economic matters with which it is concerned. As Deputies know, agricultural output and agricultural income reached record levels in 1961. These records were surpassed in 1962. In that year, the value of gross agricultural output (including the value of changes in livestock numbers) amounted to some £213 million, or £6 million more than in 1961, and profits of farmers increased by some £4 million to a record figure of £120 million. As total agricultural income increased from £97 million to £120 million between 1952 and 1962 and as the numbers whose main occupation is agricultural fell by about 74,000, it appears that the increase in per caput agricultural income during that period worked out at about 50 per cent.

These facts disprove those who have been indulging in rather wild propaganda on this subject. This propaganda gives the impression that farming profits have been falling in recent years instead of increasing. It is true, of course, that non-agricultural incomes per head are higher than agricultural incomes. There is not a country in the world, from the United States to Russia, where this position does not exist. And it exists notwithstanding State assistance to agriculture on an unprecedented scale, especially in the big industrial countries which have far greater resources than small agricultural countries depending on exports of foodstuffs for their economic survival.The fact that this famous "income gap" is universal does not in itself prove that the gap is justified, but it does prove the enormous difficulties involved in trying to close it. The basic reason for the gap is that commercial demand for food has not during the past five or ten years kept pace with increasing production, while, at the same time, there has been a continually expanding demand for industrial products. It is obvious that in a country such as Ireland which has to export at least one-third of its agricultural output to markets where, for some major products, the prices obtainable are below the cost of production here, the task of maintaining and improving the income of farmers and farm workers is particularly formidable.In fact, however, the relationship between agricultural and non-agricultural incomes in Ireland is more favourable to agriculture than in a number of other Western European countries or in the United States itself.

The financial contribution of the Government to agricultural progress and improvement has risen to a record level — from a total of some £10,900,000 in 1950-51 to £26,300,000 in 1960-61, £36,800,000 in 1961-62, £37,300,000 in 1962-63, and an estimated £39 million in 1963-64. The cost of price support, included in these figures, has gone up from £2,800,000 in 1950-51 to £8,500,000 in the present financial year. As a percentage of total expenditure on the Supply Services (including voted capital services) expenditure on agriculture has mounted from 14 per cent in 1950-51 to an estimated 23 per cent in 1963-64. Price support for milk alone is costing over £6 million this year, as against £122,000 ten years ago and £2 million five years ago. This increase is reflected in the fact that the amounts paid out by creameries to their suppliers went up from £13,950,000 in 1950 to £18,330,000 in 1955, £22,680,000 in 1960, and an estimated £28 million in 1963.

Relief of rates on land has also been greatly expanded. It cost £3,900,000 in 1950-51, £5,700,000 in 1960-61 and will cost about £8,800,000 in 1963-64. The net average rates now payable on a farm of £20 valuation amount to only £13 16s.; on a farm of £30 valuation, £31 1s.; on a farm of £50 valuation, £65 11s. Sixty-five per cent of our farms have a valuation not exceeding £20; 80 per cent of our farms do not exceed £30 valuation, and 90 per cent of our farms do not exceed £50 valuation. Apart from the employment allowances, the position is that where the valuation does not exceed £20, 70 per cent of the rates are met by State grants; where it does not exceed £30, the percentage met by State grants is 55 per cent and where it does not exceed £50, 43 per cent of the rates is met out of State grants. Of the total rates on agricultural land, 57 per cent is now met by State grants.

I have gone into some detail on the question of Government assistance to agriculture, including rate reliefs, because of campaigns of misrepresentation and false propaganda which have recently been instigated by certain interests. They appear to be a somewhat crude attempt to imitate protest meetings and marches which have taken place in some Continental countries where radically different conditions prevail. In certain Common Market countries, there has been an unprecedented industrial growth, marked by full employment, high wages and strong inflationary pressures.These developments have placed a great deal of strain on agriculture, for which a common policy is now being put into operation. This involves drastic changes in existing national policies, and growing pains are inevitable.France, which claims a high agricultural potential and has a level of prices which is low relative to other EEC countries is greatly in need of markets which she can only obtain by better access to the markets of her partner countries. Such access can only be secured by sacrifices on the part of farmers in those countries. German farmers face, perhaps, the most difficult problems of all, being confronted with the prospect of a lowering of prices and drastic structural changes in their whole farming economy in order to conform to the requirements of the common agricultural policy of the European Economic Community.

The difficulties referred to will gradually work themselves out as the movement towards a unified policy for the whole region progresses. Mean-while we must not be surprised that problems, sometimes acute, arise and I should hope that the issues will be fully understood by farm leaders here and that they will preserve a healthy sense of proportion in dealing with their own domestic problems.

Let us not belittle the advantages we have. In this country, with all our difficulties, our agriculture is being enabled through Government measures to develop under more stable conditions than in many other countries. All of our major products are supported, either by the Government directly, as in the case of milk, pigs, barley and wheat, or indirectly through links with British guaranteed prices as in the case of store cattle and store sheep. Very large amounts are being spent also on schemes to increase productivity, that is, on schemes which help farmers to produce more at less cost per unit of output. And we have a basically good system of land tenure. Farmers own their holdings subject to payment of annuities which, in nearly all cases, are of relatively trivial amount in relation to the real value of the land.

It is now over two years since I established the Interdepartmental Committee on the Problems of Small Western Farms, whose report was published in April, 1962. Many major recommendations of this Committee are already being implemented including the important recommendation that extra financial assistance should be given to county committees in the west, north-west and south-west, to enable them to expand the agricultural advisory service rapidly and adequately.We estimate that, with this extra help, the number of agricultural advisory officers in the area in question will have increased from 102 in 1963 to 183 at the end of 1965. This is the kind of practical contribution which will help to solve the problems of these areas on a lasting basis. At least that is my opinion.

There are thousands of small farms in this country of which any nation could be proud — thousands of industrious and intelligent men who are making the best use of the many facilities which are now available to enable them to improve their material position in life. These small farmers know very well that, while the guaranteed prices for wheat, barley and sugar beet are more useful to the big farmer, they themselves have in the guaranteed prices for milk and pigs a form of State support which is specially adapted to their needs, and, on top of that, they have a wider range of facilities for better farming than have ever existed before — for example, cheap fertilisers, land reclamation, building grants, improved advisory services, and so on.

Those who talk glibly about low "average" incomes ignore the fact that the real small farm problem applies, not to all small farmers but to a proportion of them whose circumstances are particularly unfavourable, due perhaps to unduly small holdings, poor soil, family circumstances, and so on. But the fact is also ignored that, in many such cases, there are other sources of income and that the farming enterprise is often a part-time one. This problem exists in greater degree in other countries, and they are trying to solve it very largely — as in France and Germany — by regional development programmes which will provide more local opportunities for work in factories, forestry, tourism, etc. there for those living on very small holdings. Far from signifying the end of the very small farmer, this policy should, in fact, enable him to survive in comfort and dignity. Our Government are also placing increasing emphasis on the regional approach to the solution of rural problems, including the small farms problems. Our development programmes in fisheries, forestry and tourism are being intensified and new jobs and additional sources of income are being created which will benefit greatly those under-employed in agriculture.Ideas on what constitutes a small farm very but I think it is true to say that, in this country, there are quite a large proportion of farms which, though not large in area, are capable of providing a good living for farmers who strive to be efficient and make use of the advisory services and the many other forms of aid available to them.

I would now like to deal more specifically with our agricultural programme in the years ahead. The programme proposed for the remainder of the present decade is outlined in the Government's Second Programme for Economic Expansion and will be set out in much greater detail in a longer document which we hope to publish early in 1964. The purpose of publishing an outline of our programme in the first instance was to enable all interested persons and organisations to express their views before the programme is finally crystal-lised in detailed form. As Deputies know, the main objective proposed in the outline programme is an increase in gross agricultural product by 31 per cent between 1960 and 1970, and the principal means suggested for achieving this target is an increase in the annual output of cattle from less than 1,100,000 in 1960 to 1,500,000 in 1970. I was very surprised to read in the papers recently that Deputy Dillon had difficulty in understanding the mathematics of our cattle projection, and I hope he has not become mesmerised by the fact that, as everybody knows, the number of cows in this country has traditionally fluctuated around a rather static figure of 1 million to 1,200,000. In fact, there is no insoluble physical, technical or practical difficulty in achieving the proposed increase in cattle output. What is involved is an increase from around 230,000 a year to something less than 350,000 a year in the rate of intake of in-calf heifers into herds. Since at least 320,000 heifers go into store or fat market at present, there is, clearly, an ample supply of females from which the extra number of in-calf heifers for our herds can be drawn.

The increase in our cattle numbers, therefore, depends essentially on our being able to induce farmers to keep increased numbers of breeding heifers instead of selling them as stores or fats. In order to give them an incentive for doing this, I propose — as already announced — to introduce early in 1964 an important new scheme under which a grant of £15 will be paid to farmers for each additional heifer kept by them above their normal cow-herd replacements.The grants will be payable after these additional heifers have calved and have been added to the herd in each case. As Deputies are aware, I had intended to give full details of the scheme when introducing this Estimate. In view, however, of the fact that the Estimate has been taken later than I had originally expected and as I appreciated the importance of letting farmers know the main features of the scheme as early as possible, I thought it well to make an announcement of a fairly detailed nature on 26th October. Under the scheme, payments will be made in 1964 on increases in the numbers in herds over this year's level, which is available from BTE Scheme records; in 1965 on increases over 1964, and so on for a number of years.

The cost of the scheme is estimated to rise from about £300,000 in the first year—1964/65—to around £1,500,000 in 1966/67 and to about £1,800,000 a year in the later '60's. On the basis of these costings there would be a total net increase of between 500,000 and 600,000 cows and heifers in herds by 1970. The estimates of annual costs which I have given are not, I should explain, rigid maximum amounts but are the best judgment we can make now of likely expenditure under the scheme. I believe it is the most simple and direct way of stimulating the increase in cattle production which we all desire. I should add that I propose to improve certain of the grants payable under the Farm Buildings Scheme and this will help farmers who are increasing their numbers of stock. I also believe that this is a favourable time for introducing a vigorous cattle expansion policy, for a number of reasons. First of all, the very gratifying pace at which bovine TB eradication is now proceeding give us every reason to believe that we will have eliminated this disease from the whole country within the next two years. Secondly, the carrying capacity of our land is steadily increasing, largely as a result of the fertiliser subsidies which have helped to bring about an increase in the use of phosphates by 80 per cent since 1958 and of potash by 50 per cent in three years. Thirdly, the expansion and improvement in the agricultural advisory services, including the development of specialised advisory services by the Department of Agriculture, together with the big expansion in agricultural research, will soon place at the disposal of every farmer expert advice to enable him to expand his production on the most efficient possible basis. We shall, of course, be prepared to discuss the details of the proposed scheme with farm organisations and interested persons.

So far as can be foreseen, the long-term outlook for beef seems to be better than for many other agricultural products, and, as there can be no doubt at all that this country is particularly well endowed for the production of cattle and cattle products, I am confident that the measures now proposed will meet with success.

I should, perhaps, add that, with the successful conclusion of bovine TB eradication in sight, we are now drawing up comprehensive plans for the eradication of brucellosis which, after tuberculosis, must have the highest priority. The basis of a brucellosis scheme would be a combination of slaughter and vaccination, depending on the circumstances of each area. We are also actively pushing the wider use of new preparations for treatment of warble fly infestation which the Department's Veterinary Research Laboratory has tested and found to be very successful.

I believe that our future cattle programme will also be assisted by the importation of American Charolais cattle which my Department arranged during the past year. These American cattle are, of course, of French descent and their quality is good. It has not been practicable in the past to arrange for direct importations of breeding stock from Continental Europe, but I think I should tell the Dáil now that, after very careful consideration and following detailed consultations with veterinary experts from other countries, including the United States, we are contemplating the establishment by the Department of Agriculture of a special island quarantine station through which the Department would hope to import breeding stock from Continental Europe of the highest quality obtainable. Needless to say, any such importations would be surrounded by the most detailed precautions and checks. I believe that it is important for our cattle industry here to have access to the best specimens of such breeds as the Dutch Friesian, the German Friesian and the French Charolais.I should, perhaps, mention that the island we have in mind for the quarantine station is Spike Island which, of course, is Army property. This means that there is no possibility of access to the island by unauthorised persons and no possibility of any stock being landed there except our own. Moreover, there is an old fort on the island surrounded by a dry moat, and I am advised that, from the point of view of segregation, this is an ideal site for a quarantine.

Our future agricultural programme will involve continuing large-scale investment in agriculture by the Government. It will mean increased outlay on grants to farmers, and increased use of credit also. This reminds me that the Leader of the principal Opposition Party has been advocating interest-free loans of up to £1,000 for all farmers. Let us have a look at what this means assuming, of course, the proposal were to be taken seriously. If an interest-free loan is available to all farmers every farmer will naturally take it whether he wants it or not. If it is not available to all farmers is there to be some tests as to who should get it, for example, an acreage, a valuation or some other such basis? Are all applicants to get £1,000 irrespective of their circumstances?

Let us take it that such attractive terms will immediately secure a very large number of applicants. As I indicated to the House last May in reply to a question by Deputy Burke the cost of forgoing interest on a loan of £1,000 repayable over 25 years on an annuity basis would be about £950 assuming an interest rate of 6 per cent. If, therefore, 200,000 farmers obtained loans of £1,000 each, the total cost of the scheme over 25 years would be £188,667,000, or £7,547,000 a year. There would also, of course, be the task of providing the capital of £200 million which would be necessary to make these advances initially. I personally regard this as pure fantasy and I would now challenge those who talk so glibly on this matter to tell us now what the qualification and the conditions are going to be about which they have so far made no mention.

Supplemented by State grants, farmers' borrowings for useful development purposes have, in fact, been increasing. Total advances by commercial banks for agricultural purposes have increased from £21.36 million as at April, 1958, to £42.62 million in April, 1963, and the total amount of loans outstanding on the books of the Agricultural Credit Corporation has increased over the same period from £2.47 million to £5.06 million. Since the passing of the Agricultural Credit Act, 1961, the Agricultural Credit Corporation have been endeavouring to provide an easier and expanded flow of agricultural credit with a minimum of formality. When the 1961 Agricultural Credit Bill was before the Dáil, the Minister for Finance indicated that he would be prepared to accept a lower dividend on share capital provided by the Exchequer while the Corporation build up reasonable reserves to meet any risks involved in a more expansionist policy. I believe that, when account is also taken of other sources of credit such as the substantial advances made by creameries to their milk suppliers, repayable out of the monthly milk cheques, present credit facilities, supplemented by my Department's grant schemes, are reasonably adequate, I would not be in favour of deliberately encouraging farmers generally or indiscriminately to go into debt by means of so doubtful a device as interest-free loans, and I believe that such a scheme could, in practice, impose serious long-term burdens on our farmers.

The Dáil, will, no doubt, expect me to say something about recent British proposals for steadying food markets in the United Kingdom. These proposals would involve British home production as well as imported supplies, and the expressed intention is to bring about more orderly market conditions and to prevent disruptive falls in prices such as have occurred from time to time in recent years. The British regarded bacon as the product which called most urgently for arrangements of the kind indicated, and during the past few months they were discussing this product with the supplying countries, including Ireland. On our side, we kept farming and trade organisations informed about these discussions, which terminated in a multilateral understanding reached in London last week by Britain and the seven other countries regularly supplying bacon to the British market, namely, Denmark, Poland, Ireland, Netherlands, Sweden, Yugoslavia and Hungary. We were prepared to co-operate with the other countries mentioned, including the United Kingdom, in an agreement for the sharing of the bacon market in Britain on a basis which would be reasonable from our point of view, particularly if our position on the British pork market would be secured.

The understanding reached on the supply of bacon to the UK market gives us a share for the year commencing 1st April, 1964, of 27,000 tons out of the minimum total quantity of 615,000 tons agreed for that year. This compares with about 24½ thousand tons supplied by this country out of a total of 615¾ thousand tons supplied to the UK market in the year ending June, 1963, and may be regarded as a reasonably satisfactory result for us. We will also share on a percentage basis in any increase in the minimum total quantity of bacon which may be agreed later for the supply to the UK market above the level of 620.6 thousand tons. We will therefore have an assured place in the growth of the British bacon market. In addition to the initial minimum total quantity of 615,000 tons for the year 1964/65 there will be a reserve quantity of 25,000 tons for that year, the first 5,600 tons of which will be shared by four countries—UK, Denmark, Poland and Sweden whose overall shares had been slightly modified during the multilateral discussions.

The multilateral understanding provides for the establishment of a Bacon Market Council consisting of official representatives of the participating countries. Bacon industry advisers from each country will also constitute an Industry Panel, to be associated with the Bacon Market Council. The Council will be concerned with keeping under review the functioning of the understanding and the realisation of its objectives; advising on distribution from the reserve quantity and on the overall quantities to be fixed in future years; considering rates of supply to the British bacon market in an orderly way; and other such matters. As regards rates of supply, due regard will be had to the normal pattern of supply in the case of a supplier with seasonal production. The limits on supply fluctuations will not be unnecessarily narrow in the case of suppliers like ourselves who have relatively small shares of the market.

I should make it clear that the multilateral understanding relates only to bacon and does not cover fresh pork for consumption as such, in which we have a growing trade in recent years. We have had bilateral discussions about our pork trade with the British authorities and they have told us that they have no intention of imposing any restriction on pork imports. Our pork has a very good reputation on the British market and our exports of that commodity will have a special place in our plans for the pigmeat industry under the Government's Second Programme for Economic Expansion.

Some discussions have also been held about beef and lamb, but these have by no means reached an advanced stage as yet. These products are, of course, of cardinal importance to our economy and, indeed, our future agricultural and general economic development will require that we have reasonably good markets in which to dispose of the increase in production we foresee under our Second Programme for Economic Development. I, myself, believe that the time is coming when the countries which import substantial quantities of agricultural products must come to sensible terms, especially with smaller nearby countries, which have traditionally been dependent on the export of agricultural products to these larger industrial countries. Ideally, such arrangement could be envisaged as a consequence of an enlarged European Economic Community, of which the United Kingdom and Ireland would both be members, and, while nobody, of course, can foretell the future, long-term political and economic forces will, in the opinion of many people, lead the two countries along this road. In any event, we shall continue to have very close agricultural relations with the neighbouring country and, if these relations are maintained on a sensible and harmonious basis, the outlook for the future should not be unfavourable. Ireland, of course, is one of Britain's biggest customers. Our imports from Britain in 1962 exceeded in value the imports by Denmark and New Zealand from Britain in that year. Per head of population, we rank first among the importers of British goods, and in absoluate terms we are the tenth biggest customer for British goods in the whole world. These natural trade associations and affinities are the proper foundation on which to develop a further expansion in trade between the two countries.

I should now like to deal with the Supplementary Estimate for a net sum of £1,215,000 which is also before the Dáil. The biggest item is an increased provision for the support of creamery milk prices. This provision, added to the original estimate of £4,668,000 will make a total of £6,018,000 available in support of creamery milk prices during the present financial year. This is the largest amount of money ever made available by any Government for this purpose.

Furthermore, I should like to mention here that when An Bord Bainne took over butter stocks from the Butter Marketing Committee on 1st August, 1961, my undertaking to enable the Board to start its operations with a clean sheet was implemented by the Exchequer meeting the Board's estimated export losses on those stocks and on stocks held by creameries at that time. These losses were related to the prices then obtaining for butter on the export market but as a result of an increase in these prices the Board made an unexpected profit of approximately £380,000 on the disposal of these stocks. This profit has not been offset against the Board's other losses and they have been permitted to retain it in full. It can, therefore, be regarded as an additional Exchequer contribution to the Dairying Industry. Personally, I am glad to see the steady increase in milk output which our farmers have achieved in recent years with the help of considerable Government assistance both of a technical and financial nature. We now have the highest support price for milk in our history, notwithstanding that the total output of milk has increased spectacularly during the past five or ten years.

Notwithstanding all the assistance given from the taxpayer, it will, of course, always be contended on behalf of producers — as it always has been contended — that the price of milk is not as high as it should be. There can be no objection to legitimate efforts by producers to secure an increase in the milk price but it is quite another thing to find an attempt being made to induce creamery societies to refuse to meet marketing commitments to which they are legally bound under statute. Such a course can only be described as irresponsible. If certain creamery societies should be so unwise as to persist in a course of this kind, it can be countered by a withholding of the creamery milk price allowance paid by my Department to all creameries.

Another substantial item in the Supplementary Estimate is the sum of £330,000 under the Grain Storage Scheme which I introduced earlier this year and which came to an end in September. As a result of this scheme, there has been a notable increase in the amount of grain storage capacity and grain drying facilities, and this has contributed in no small way to the efficient handling of the 1963 harvest.

The Supplementary Estimate also includes £100,000 for additional expenditure on farm building grants. We under-estimated the extent to which farmers would avail of this Scheme in the present financial year. Total expenditure is now estimated at about £1,100,000. It is very encouraging that farmers are showing such eagerness to avail of this very useful improvement scheme.

In the Supplementary Estimate we are also asking for an additional £100,000 for losses on disposal of the 1962 wheat crop. The total cost of Exchequer support to wheat growers since 1957 now amounts to no less than £11 million.

The fertilisers subsidy is another item on which we have to ask for additional money to the tune of £150,000. This is due to the fact that the use of phosphatic fertilisers in the present year is likely to be considerably higher than we anticipated when the Estimate was being prepared. As I have already mentioned, the use of phosphatic fertilisers has now increased by about 80 per cent compared with 1958.

I am also asking for a sum not exceeding £10,000 to be paid to the National Farmers Association as a contribution to their expenses in connection with the Conference of the International Federation of Agricultural Producers which was held in Bray earlier in 1963. This is a maximum sum, and the actual amount required may prove to be less when statements of expenditure have been received and duly examined. Conferences of this kind are expensive, and I readily agreed to the request of the NFA for a contribution in this case.

The estimated net saving on the Bovine Tuberculosis Eradication Scheme over the provision made in the Estimate, that is, a fall in gross expenditure of £2,118,205, counter-balanced to the extent of £1,285,000 by a consequential deficiency in Appropriations in Aid, does not, of course, mean any slackening in the pace of eradication. It means, on the contrary, that the number of reactors has proved to be less than we anticipated and that eradication has made even greater strides than we hoped when the Estimate was being framed about a year ago.

Subhead C.3 of the Supplementary Estimate represents a payment to the Food and Agriculture Organisation in respect of the project we are sponsoring in Tanganyika under the Freedom from Hunger Campaign. The project will be administered through FAO which has very wide experience of such matters, and, while the field cost of the project will be met from the national collection organised by the Irish Red Cross Society, the Government have agreed to meet the technical and administrative servicing costs incurred by FAO in organising and supervising the project.

I should like to take this opportunity to pay tribute to the Irish Red Cross Society for having already raised the level of the collection to the substantial figure of £94,000. I understand since that figure was recorded that it is nearer to £100,000 now, and to thank them for agreeing to continue the collection until 1965. Our Tanganyikan project will consist of the establishment of a village settlement scheme and a related farmers' training centre. We have had detailed discussions about the project with the Minister for Agriculture of Tanganyika and representatives of the Food and Agriculture Organisation, and I am satisfied that the project which will be of a very practical nature, will represent an appreciable contribution to the agricultural development of Tanganyika and will afford abundant evidence of the generosity of the Irish people when called upon to help by voluntary contributions people in other parts of the world whose lot is difficult and who have a tremendous task facing them in getting their economic development under way.

In conclusion, may I say that, as usual, I am asking the Dáil to make available an increased amount of money for agriculture. I do not think that the Dáil will grudge this amount, large though it is, for the further development and support of this industry.

I move:

That the Vote be referred back for reconsideration.

As long as the Minister appreciates that my felicitations refer to his personal and not to his political health, I wish to congratulate him on reaching 40 years in public life. I want to say that in the past three years when he comes in here, he seems to bring with him rose-coloured spectacles and he produces figures which seem to indicate that the agricultural industry is well and that the farmers are doing better than they are.

The Minister refers to the figure of £213 million and the figure I had was £211 million which was up £5 million on the figure for 1961. This was gross agricultural output and at the same time, the costs were up so that the net output was only up by £1,800,000. If we look at the table of statistics which was issued at the time of the Budget we will see at the bottom of Table Six that the output takes account only of the costs of seeds and fertiliser; it does not take account of the cost of tractors, increasing labour cost and increased living costs so that the net agricultural output in 1962 was far less than it was in 1961.

That is bunkum.

These are the figures. I merely give them as I take them from the Government's own Book of Statistics issued with the Budget. These are the figures we must consider. The last figure we have for agricultural prices is that for September, 1963 and compared with the base 100 for 1953 that figure is 101. The figure for August was 100.5 and for most of last year it was under 100 so that the farmer was not really getting as much for his produce as he was in 1953.

Let us examine the position in relation to the things he has to buy. If we look again at the economic statistics we will find in Table 14 that the consumer price index is given at 125.3 for 1962 so the farmer had to pay 25/- for every £1 he paid in 1953, although he got £1 for every pound's worth he sold in 1953. That means that his income has decreased by 25 per cent in those 10 years.

Then we have another indication in the percentage of the national income that the farmer enjoys. While in previous years we find that he enjoyed 25 per cent and 23 per cent of the national income his share in 1961 was 20 per cent and that has decreased in 1962 to 18 per cent. And at the same time, everybody will admit that the farmer is the corner-stone on which all our prosperity must be based.

The output of cattle was something better in 1962 than in 1961, but 1961 was a low year and the previous years were much better. The previous year gave us a stock of cattle of 1,168,000 head but in 1962 this dropped to 968,000 head.

Even though the figures for the current year up to last August are better all round than those in 1962 I do not see any great improvement in our position. I am the first to agree that there are improvements in the numbers of our breeding stocks but at the same time I am quite certain that there is no real improvement over the past three years in the output of cattle which is what we must all live on.

I would like to make a summary of the position in 1963 in a broad way before I go into greater detail on these matters. There was some increase in our breeding stocks of cattle but there was a reduction in the number of sheep and pigs, two matters that are most regrettable. Pigs are the poor man's friend and our grassland is not stocked as it should be stocked. Sheep have a low capital value in relation to profits and a higher rate of employment on the land. At the same time, we had a decrease of 6.4 per cent in the area under grain crops. At the same time, in the high priced product, wheat, we had a reduction of 25 per cent. This meant, if one is to take one ton per statute acre — a figure usually used for the production of wheat — and the very low price of £25 per ton, a reduction, in terms of farmer's income, of over £2 million. That is the year the Minister puts on his rose-pink spectacles. That is the year in which he says we have stepped forward. I do not think we have.

There has also been the question of subsidy for heifers which the Minister has now announced. There are various flaws in this scheme — which we welcome as a measure of improvement but a very small measure of improvement. One of the flaws is that while a large farmer may be in a position to spend money to increase the amount of space for cows, to increase his herd numbers spectacularly, the small farmer who has been obeying all he has been asked to do over the years and who has brought himself to the optimum will gain no money from this scheme whatsoever.

Take a man in the west with maybe five or six cows. It will be very hard for such a man to bring his number up to seven or eight. When he gets to seven, all he will get is £15 and he will never get another one until he steps up to eight. On the other hand, a man with 30 cows can more easily increase the number to 40 and thus make it worth while in one year. This scheme will definitely help but to such a small and measured extent that it is not anything like what the Minister would like us to believe it is. Furthermore, his figures confuse me.

I cannot understand how he estimates that at the end of the period he will have 120,000 new heifers, apart from replacements, entering the cow herds each year so that the scheme will cost £1,800,000 at that period. Bear in mind that the largest increase in the number of heifers recorded so far has been less than 20,000 and the increase this year is 12,000.

We feel that these figures are just something out of arithmetic, which seems to be what has governed the blue book on Economic Expansion. Without doubt, the whole thing is related to the statement of page 28 of that book whereby a major aim of the Second Programme is "to raise the output of cattle from 1,046,000 in 1960 to 1,500,000 in 1970, an increase of 454,000 or 43 per cent almost all of which will be for export." We do not believe — and we would be the ones who would make every effort to bring it about—that just can be done. While it is necessary for the Minister, in producing this scheme which is apparently the foundation on which he is trying to build, to make a statement that in the late 1970's he expects an extra number of heifers in cow herds in each year to prove his arithmetical formula we are of the opinion that the figure he states could not be achieved and will not be achieved and therefore is nothing but in the nature of something to keep people happy if they will only believe it.

Do not think that this question of calf subsidies and heifer subsidies has not been considered by the Party on this side of the House. I should like to quote the Leader of the Opposition on the Agricultural Resolution at the Fine Gael Ard-Fheis when he said, in February, 1962:

It would be worth while examining the calf bounty for calves born from attested cows and heifers. This would be a material incentive to dairy farmers to have their herds attested, and at the same time increase the number of cows and heifers in the country.

On Wednesday, February 28th, 1962, again from the Irish Press of that day, the Leader of the Opposition was reported as saying:

That it would be worth examining an incentive along the lines of a calf bounty for calves born of attested cows or heifers.

I myself referred to it on the Estimate for the Department of Agriculture in 1962 as reported in the Official Report, Volume 196, column 2386 of 17th July, 1962. I said:

There was a suggestion from this side some months ago that a subsidy on calves might possibly be considered.We have not all the information here and cannot readily get it, so I am not suggesting that that would be a positive answer, but it is something that might be considered by the Minister.

The Minister apparently has considered our suggestions. We believe that the scheme he has produced is a watered-down version of what we would have done. We wish him well but we do not believe that the figures that have been quoted for it will be realised nor do we believe that the Minister's Party intend to realise it.

A question which occupies us each year on this Estimate is the number of people on the land. It has come to be accepted by politicians and by all sorts of people in various walks of life who like to consider these things that there will be fewer and fewer people on the land. It is quite true to say that there will be a certain wastage of employment on the land because of a greater economy of effort, greater mechanisation, more modern ways of doing things. But to say that there will be fewer and fewer people on the land in each progressive year is to suggest that at the moment we are at the optimum of efficiency; that at present, there are no new opportunities for employment on the land.

The figure of 19,000 fewer on the land in 1962 we regard as a catastrophe. The fact that this figure was balanced only by a tiny increase of 3,600 persons in industry in the same year further highlights and magnifies that catastrophe. It is our belief that while there may be fewer people engaged in specific tasks there are more opportunities for work on the land. We believe that the Party now in power is not investigating those opportunities and that if there were increases in production it would take more people to produce the increased volume.

The Government have stated in their blue book that they accept 1.8 per cent as the annual drop until 1970 in the numbers employed on the land and 2.7 per cent as the annual increase in production. In Northern Ireland the number of people who left the land in each one year of the past 10 years is 1,000. We on this side do not accept the glib statement by professors of economics, politicians and all these people that in respect of every person who leaves the land of Ireland there is no opportunity to employ another. We regard the figure of 19,000 fewer people on the land in 1962 as a national catastrophe and that if there were to be any decrease, and we do not accept that there should be, it should be far lower than that figure. The fact that in another part of this island the decrease in each one of ten years was only 1,000 whereas our figure was 19,000 in one year indicates the failure of the Government to do what they should do for the agricultural industry.

If one wants to indulge in arithmetic, there is no doubt the figure of 2.7 per cent increase in agricultural output, the annual amount laid down in the Government's Blue Book, would be far exceeded if the Minister's statement on the increase in the output of cattle were realised. That is where the people who exist on statistics and arithmetic and produce something that is supposed to be accepted as a sugar-coated pill by the people, fall down. Anybody who likes to examine the arithmetic of that will see that if we could do what the Minister says, we would far exceed the figures laid down. We do not believe the Government want to do this and that is the great difference between them and ourselves.

Perhaps it is an indication of how the Government feel about agricultural production that they did not include a farmer in the national Economic Council, nor did they give representation to a farming organisation or anybody having direct dealings with agriculture.These are the facts that must be remembered and it must also be remembered that agriculture, according to figures published in Economic Statistics circulated by the Government before the last Budget, employed 360,800 and that the number employed in manufacturing industry at the same time was only 164,000. We had a fall of 19,000 taken into account in that figure of 360,800 and yet in a figure far less than half of that, we got an increase of only 3,600 people. Where are we going? Who has succeeded in getting this thing across that agriculture is a backwater, that it must survive in the backwoods, that the opportunities are not there and that the political effort of bringing people with you and trying to make them do things that will give them a decent standard of living, make them remain on the land, is a bad political bet? That is something that must change and we, on this side, are ready and willing to make the effort to make that change.

There has been much talk in recent years of marketing of agricultural produce, its supply and quality. Clearly, the first step the Government must take is a realisation that if we have a constant supply of high quality agricultural goods available and can maintain that supply, it is only then we can expect to sell. Let us remember our experience with butter. At a time when Denmark was regulating her exports of butter to Britain to a variation, year by year, of not more than two per cent, we sent almost no butter to Britain in 1959—which was a dry year — and as a result, our quota, when fixed by GATT and accepted by Britain, was very small. I believe they have helped out with that since in a temporary fashion, but that is the sort of thing in which we go wrong.

That consistency of supply that is required can only be achieved by the Government setting out to get increased production which will secure us valuable markets, even though it may create losses and political difficulties.That is the belief of this side of the House—that the Government do not want that, that what they want to do is come here and say: "We had to pay a little more for agriculture this year than last", or, even "a great deal more". We believe that the real effort is to pay as little as possible and that they feel any constant increase in production is something that will cause political difficulties for them.

There is also the aggressive line that should be taken in relation to countries that do not take from us at least as much as we take from them. We have a great opportunity there by taking an aggressive line and trying to ensure that these countries buy from us at least almost as much as we buy from them. For instance, it is hard to think that France, with its millions, bought only £1,475,000 worth of agricultural produce from us in 1963: it is extraordinary that quotas were fixed with Federal Germany whereby we were restricted to £1,650,000 of carcase beef, 250 tons of canned meat and 250 tons of mutton and lamb. To Belgium, we exported £900,000 worth of agricultural goods — a drop from the previous year for which the figure was £1,325,000. These are extremely small figures and we want to know did the Government say to these countries: "If we buy from you, will you not buy more from us?" Did they take that aggressive bargaining line? Did they say to Holland that she should take more from us than the £1,680,000 worth they did purchase, which showed a reduction on the £2,010,000 worth they took in 1961?

I could go on with this list for a long time but I do not think I need elaborate. We all know these countries — I drive a German car myself. Can we not succeed in getting, by real bargaining, a greater share in these markets for our agricultural produce? I think we can and that it is essential that we do.

The position about marketing makes it clear that we must market branded products. I have been asking a series of questions here year after year on branded butter and eventually An Bord Bainne brought out Kerrygold butter. I know advertising expenses of Kerrygold are quite high but I would regard those as more of a capital charge in the first years than an actual expense to be charged against each ton of butter exported. That is how a businessman would do it, and would have to do it if he wanted to gain access to a market. When we remember that Kerrygold in certain markets gets a premium of as much as £22 per ton, it is a big satisfaction to realise that by advertising, if you have high quality and constancy of supply, you can gain such a premium by selling to the housewife rather than the retailer. You put yourself in the position that the housewife is asking the retailer for your product. That ensures you a market and when quotas are being fixed again, in addition to considering the amount sent in dry years and wet years, the British Government or GATT must also consider that you have established yourself to such an extent with your branded product that the citizens of the country in question want your branded product and no other.

These are simple facts which have governed business not for decades but for centuries. They have been exploited to the full in the last couple of decades and it is, therefore, irritating to us to find that in 1957, when this Government took office, they voted a sum of £250,000 for agricultural marketing and the way in which the Minister for Finance got rid of the last of that sum — I think some £130,000 — not so long ago was by passing it over to An Bord Bainne, which was just another way of putting it into a kitty where it would benefit nobody solely for the purpose of preventing Deputy T. Lynch constantly asking questions as to how much of £250,000 voted several years ago had been spent. For the four years following 1957 all that was spent was the expenses of certain advisory committees.

The Minister mentioned advisory services and I am sorry that the scheme announced in respect of the west of Ireland has not been made general throughout the country. There is great necessity in the west for increased advisory services, but we believe there is fantastic necessity for an increase everywhere in such services.The Minister has been very dilatory in this matter. What we want to get across—the Minister has not mentioned it — is that one must have a correlation between advisory services and actual production on the farms. We would prefer an advisory service manned by personnel who would call at the farm and suggest new production on the farm or a change in existing production. The advisory officer should bring home to the farmer the benefits of the operation, even costing it for him, if necessary, and showing the profits and advantages to be gained by modern methods of husbandry.

The Minister was quite scathing in his comments of the plan adumbrated by the leader of the main Opposition, the plan to give £1,000 interest free loans. We would operate these loans in the way I have just suggested. The leader of the main Opposition has made it quite clear, as have other speakers on this side on many occasions, that these loans would be given to farmers who would co-operate with the advisory officers in specific schemes designed to increase production. That is how we intend to implement this scheme.

The arithmetic adopted by the Fianna Fáil Party is of no interest to us. The Minister produced a glorious figure of £7 million. While he was talking about it I had a look at the Statistical Abstract. If one takes the 30-acre farm, in which the schemes would be relatively small schemes, one finds that out of a total of 360,000 holdings there are 140,000 30-acre farms or less. This question of the maximum sum and all the difficulties are just a way of deprecating what we believe should be a comprehensive scheme to help the small farmer and Irish agriculture.

We would hope that every one of these schemes in which an interest-free loan of £1,000 would be given would constitute a pilot scheme, a scheme in which every neighbouring farmer could see the work done. Each operation would be under the guidance of the advisory officer. That is the way we want to do it. There is nothing wrong in it. The arithmetic produced by the Minister does not detract one whit from it. Even if it were the sum mentioned by the Minister, the difference between the Minister and this side of the House is that we are prepared to "go it", whatever it costs. I have some figures I shall quote later to support my argument. The Minister would prefer to produce a small, measured scheme, such as that in relation to the subsidy for heifers, and then support that with fallacious arithmetic in an effort to prove it is something really worth while.

Credit facilities for farmers must be considered. I asked the Minister today the source of long-term capital available to farmers, with no spare money of their own, who wish to drain their land and who cannot avail of section (b) of the Land Project now discontinued.The answer I got was that the alternative sources of credit are the Agricultural Credit Corporation and the commercial banks. I have nothing but praise for the Agricultural Credit Corporation, but up to a few years ago that body did not give long-term loans. That is not their function.

Fifteen years.

Does the Minister think that a farmer with no spare money of his own can repay a loan for a major drainage scheme on his holding in 15 years?

It is a fair stretch.

Does he think it is as good a proposition as having it put on the farmer's land annuity over 35 years? I am a borrower myself from the Agricultural Credit Corporation, an excellent institution, and I know that they will not give you 100 per cent of the cost of your land drainage. No ordinary financial institution will. The Minister mentioned the commercial banks. No commercial bank will give more than 50 per cent of the cost. I want to say quite categorically now that it is the decision of this Party, when we take office, to reinstitute section (b) of the Land Project thereby ensuring that the small farmer, and the poor farmer, will be in a position to avail of the land project to drain his land, giving him a repayment period of 35 years on his land annuity.

We believe credit facilities and advisory facilities should be interrelated.The last few years have seen fairly free credit but the trouble will be not merely to provide the money to capitalise on our 12,000,000 acres of arable land but also the proper application of it. We are quite determined, when we are re-elected, to interrelate credit facilities and advisory services and ensure that advisory work is related to actual progress on the farms. Individual efforts will be made, substantiated by our pilot schemes of up to £1,000 interest free loans, to ensure that, by example, proper advisory services and a correct appreciation of the asset we have for exploitation, the land of Ireland will give its full contribution to the nation's economy as against the position I outlined at the start in which there is a drop from 25 per cent of the national income to 20 per cent, to 18 per cent, with 19,000 fewer people on the land and agricultural prices standing at the same level as they did in 1953, while the cost of the things the farmer has to buy increased by 25.3 per cent.

There is another matter I must mention, though I dislike having to do so. The Minister's relations — the Minister confirmed this in his own speech — with farming bodies are bad. We had during the year the Bord Gráin row. I want to say I believe that in this instance the Minister was seriously at fault. It is quite wrong for the Minister in the use of his office to select individuals for appointment to the Board, when the practice should have been to leave it to the bodies concerned to select their representatives.In my capacity as a merchant, I was present at a meeting at which we voted to select our representatives. When it came to farming, the farming organisations were allowed to propose certain people, but then the Minister said: "I shall select others myself". That is quite wrong.

At page 4 of his statement, the Minister refers to what he called campaigns of false representations and said there appeared to have been here a somewhat crude attempt to imitate protest meetings and marches that have taken place in continental countries where radically different conditions prevailed. He should realise by now that every Department must be ready for criticism and I suggest to the Minister that now and again he should look at the That Was the Week That Was programme on Saturday nights on BBC television or some of the other similar broadcasts from that station. He would then realise what the public man has to put up with, and smile if he can.

The Minister's function now is to lead the farmers, to strive to get the farmers with him. I was shocked to see a reply to the Editor of the Irish Farmers Journal in Farming Bulletin recently. I do not care whether the Minister was right or wrong: an antagonistic reply of that nature should not have been made. Once one is in public life one must realise he is liable to be a butt. The Minister, in my view, has been indulging in unseemly and unnecessary vituperation.The relationship between the farming bodies and the Minister is of great importance ultimately and no matter how much it irritates, the Minister should not indulge in this behaviour.

Another exercise that is being performed almost hourly is the assessment of the bill against the farmer and against agriculture. Nothing annoys us more on this side of the House than the suggestion that the farmers are living off the lady who sells hats in Grafton Street. It is old now: we have had it every year. I do not think the Farming Bulletin helped when it produced a two-page list of the things which they alleged the farmers were getting in the form of State aid to agriculture.

I should like to differentiate between State aid to agriculture and State aid to the State generally. I do not concede, for instance, that a single pound spent on the eradication of bovine tuberculosis benefited the farmer by a single penny. I am quite satisfied that the total operation, so necessary and, thank God, now reaching a successful conclusion, was in defence of exports, was in defence, incidentally, of the lady who sells hats in Grafton Street. This exercise of totting up the bill against agriculture is, therefore, something that should not be indulged in. This list in the Bulletin, to which I have just referred, includes the bill in respect of butter and butter products for 1963-64 at £6,418,000 but they do not mention the fact that the price of milk in Norway is 3s. 0½d., in the UK, 2s. 10½., Italy, 2s 7d., Netherlands, 2s. 6½., Germany, 2s. 4d., Denmark and Belgium, 2s. 3d., France 2s. 1½d. and in Ireland 1s. 9½d.

What about the skim?

The figure in fact takes account of that.

I am afraid not.

The average price for milk in this country, without skim, is 1s. 9½d. The figures I am quoting in respect of European countries are taken from a report of the EEC and laid before this House on 13th June, 1961.

I do not concede that arterial drainage is something specifically for the benefit of farmers. This is work that should have been done years ago, and would have been done were it not for our troubled record of strife. It benefits everybody in the country; it is work that is largely done to protect us from further flooding rather than to improve the lot of the farmer and give him 10 or 15 extra acres on his holding. Often it does, but the farmer pays his share.

I do not concede that bacon factory grants are things that should be laid against the farmers, that Gaeltacht and congested area schemes are a bill to be laid against the farmers. I do not concede that Departmental capital expenditure on lands and buildings is a bill to be laid against the farmers. Neither do I concede that relief of rate charges, which is estimated at a large figure for the current financial year, is a bill to be laid at the door of the farmers. I do not believe capital for the Agricultural Credit Company is a bill that can be laid against the farmers because when a farmer goes to that excellent organisation, he pays his interest. These are the sort of things I should like the Minister to consider.

The big thing is that in the publication of figures in this form you create a situation of town versus country, of agriculture versus industry. Our view has been and will continue to be that we must have both arms. Industry needs a good agriculture which will buy a proportion of its products and so let agriculture produce more for export. There is the old saying that we eat one-third, sell six at home and export one-third. The market for agricultural produce is of the utmost importance to the farmer, and the production of lists of figures such as I have referred to leads to a situation where one part of the community begins to think the other is taking the bread out of its mouth. That is not the type of atmosphere that will lead to a prosperous nation. We must strive always to live together, not begrudging the other, co-operating one with the other.

I should now like to turn to a discussion of our grain crops. As I mentioned in my opening remarks, our grain crops are down by 6.4 per cent.

Progress reported; Committee to sit again.
The Dáil adjourned at 10.30 p.m. until 3 p.m. on Wednesday, 13th November, 1963.
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