Dáil Éireann debate -
Tuesday, 2 Mar 1965

Vol. 214 No. 8

Committee on Finance. - Vote 40—Agriculture.

Minister for Agriculture (Mr. Haughey)

I move:—

That a supplementary sum not exceeding £675,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st March, 1965, 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 net amount of this Supplementary Estimate, together with the previous Supplementary Estimate, added to the original Estimate for 1964/65, brings the total net expenditure from the Vote for my Department to £30,999,700.

As is customary in the case of Supplementary Estimates relating to a limited number of subheads, I shall confine my remarks to the items covered in the present Estimate.

I shall deal first with Subhead K.11, the Bovine Tuberculosis Eradication Scheme, for which an additional provision of £200,000 is proposed. This is, however, more than offset by the additional £260,000 expected in receipts under the Scheme and shown under Subhead P, Appropriations-in-Aid.

The progress in the past few months has been greater than we had anticipated, even in November last when I asked for an additional sum of nearly £600,000. When the Supplementary Estimate was then under discussion, we expected that the total number of reactors which would be sold to the Department within this financial year would be 31,000. It now seems that, by the end of March, a total of 33,700 will have been taken up. This compares with a total of 115,000 reactors taken up in 1963/64. In addition, the higher market prices for cattle have been reflected in the compensation that we are paying. On the average, the compensation paid since 1st April last has been £68 for cows and £59 for other cattle. The corresponding figures for the previous year were £58 for cows and £47 for other cattle.

The momentum of the BTE Scheme is increasing steadily in the six southern counties according as we draw near our goal of total eradication. It will be recalled that at the beginning of 1964 my Department envisaged the attestation of the south in two stages. It is now clear that, if the progress at present being achieved can be maintained, we can bring all these southern counties along together and have the whole country attested by the autumn. The completion of the eradication scheme in just 11 years from its commencement in September, 1954, will be no small achievement.

Under Subhead K.14 we are looking for an additional £200,000 for the Scheme of Grants for Calved Heifers. Added to the provisions already made for this purpose in the original Estimate and the previous Supplementary Estimate, this will bring the total provision in 1964/65 to £3,155,000.

The response by herdowners to the Calved Heifer Subsidy Scheme has far exceeded expectations. When the previous Supplementary Estimate for this scheme was taken last November, it was expected that there would be a considerable seasonal drop in the numbers of applications for grants during the winter months, but in fact the demand for grants has continued at a high level. The total number of heifers on which the grant of £15 will be allowed up to 31st March, 1965, is now estimated at about 203,500 as compared with the estimate of 190,000 heifers last November. The benefits of the scheme have been widely diffused throughout the country, including the western counties and the smaller holdings in particular have benefited. The average individual grant works out at £37 representing over two animals per herdowner.

The target for increased cattle production in the Second Programme for Economic Expansion would require an average annual increase in cow numbers of 75,000 up to 1968. This figure has been exceeded in the past year.

Next we come to Subhead K.19 which is the new subhead to provide for the temporary scheme of payments, announced in January last in respect of good quality fat bullock and heifer beef exported to the United Kingdom. Payment is at the rates currently payable in the United Kingdom under the British Fatstock Deficiency Payments Scheme. Our new scheme was introduced in order to arrest the serious decline which was taking place in the trade of the meat export premises due to lack of supplies of finished cattle. Total slaughterings of fat cattle and cows at meat export premises declined from 403,700 in 1963 to 302,000 in 1964. Exports of store cattle increased from 565,200 in 1963 to 637,000 in 1964. A falling-off in the number of cows slaughtered, arising from a number of factors, led to a serious decline in the export of boneless beef to the United States.

The Government decided that steps should be taken to increase the numbers of cattle fattened at home. This would benefit both the feeders and the industry. Its advantage to producers is that any farmer who is in a position to finish cattle, but who might ordinarily consider it more prudent to dispose of his cattle at the attractive store prices prevailing, can now hold on to the cattle in the knowledge of getting a satisfactory price for them when they come to be sold for beef.

The scheme is not, of course, and should not be regarded as in any way directed against the store trade. The export of store cattle to Britain is a traditional and very necessary part of our cattle economy and the link with the British Deficiency Payments Scheme is of very great importance to us. However, this store cattle arrangement does militate against the finishing of cattle here and makes it difficult for the meat processing industry to get sufficient supplies of raw material. As our total cattle production expands, however, there should be plenty of scope both for the store and the dead meat trade.

We are hoping that the present scheme will arrest the decline in activity which took place in 1964, particularly in the latter half of that year, in our meat export industry. This is one of our most important and efficient agricultural processing industries, giving considerable employment and contributing substantially to our export earnings; and it developed without State assistance. In 1964 our exports of beef, mutton and lamb in carcase and processed forms and of offals and by-products earned this country about £23 million. We estimate that this figure will have declined to about £21 million in 1964 in spite of higher prices in that year. The industry enjoys farmer confidence and the survey team which examined its activities a couple of years back confirmed its efficiency.

Payments under this scheme arise only when deficiency payments are made in Britain. The British scheme provides for the breaking down of the guaranteed price there into a series of weekly standard prices, the weekly price being highest in the earlier months of the year when cattle are scarce and lowest during the late summer and autumn periods of heavy supplies. The subsidy rate payable is broadly the difference between the weekly market price and the weekly standard price. Because of the strong market for beef last year and the consequently high market prices for cattle in Britain, no guaranteed payments were made there from June to the middle of January with the exception of small payments for one or two weeks in November. Payments having now resumed seem likely to continue for the time being. Because of the continuing relatively satisfactory prices for beef in Britain, it is not expected that these payments will be high. We accordingly estimate that our commitment up to the end of March will be of the order of £50,000. From April to June the estimated expenditure is £150,000. What the situation in the trade will be by the end of June. when this Scheme is due to end, I could not at present attempt to predict. We can only judge the situation as we see it then and decide what measures, if any, are necessary for the continued well-being of our cattle and beef industries.

A sum of £700,000 is included to meet the cost of the ninth-round wage increases and status claims in respect of the staff of my Department. For convenience the total estimated cost, which covers several subheads of the Vote, is provided for under a single subhead (A).

The favourable trend in prices being received for our butter on the export market has resulted in a smaller demand being made by Bord Bainne on the Exchequer than was estimated. A saving of £215,000 on Subhead N is anticipated and this reduces the total net additional amount required to £675,000. This is a matter for congratulation and I would like to commend Bord Bainne on their continuing endeavours to improve the position in regard to our exports of dairy produce.

Mr. Donegan

The fact that this Supplementary Estimate was circulated only this morning means that the House had not a full opportunity of examining in detail all the items included in it. I suppose, since Government business did not seem to be coming forward, this had to be so. However, it is not a very difficult Estimate to discuss and I am sure we can discuss it without leaving out any point that should be made.

The net amount of the Estimate is £675,000, and Subhead A7—Salaries, Wages and Allowances—accounts for £700,000. What we have before us, therefore, is not a large increase in expenditure. In fact, it reflects a net decrease. Two items must be taken into account in regard to the Bovine Tuberculosis Eradication Scheme— Subhead K11, the cost of the scheme, and P.—Appropriations in Aid, which gives the value of the reactors sold. Here there is reflected an increased turnover—if one can use that expression in respect of the scheme—rather than an increased loss. The Minister referred to the fact that cattle prices were higher. If that is true, the price got for the animal when the Department sold it was higher, so that the appropriations-in-aid increased proportionately. It is a matter for rejoicing that it now appears as if the eradication scheme will be finished more quickly than had been at first anticipated, and in one step where two had been envisaged. We welcome that because we feel it will bring great benefit to the farming community.

The Scheme of Grants for Calved Heifers shows a small increase. During the previous discussion here, it was pointed out that the original Estimate was very far wrong. It was found that the original sum of £450,000 had increased to £2,950,000. Now there is a further £200,000. There is a certain anxiety which the Minister always seeks to dissipate by indicating that the size of the claim here is small. Nevertheless, there is an anxiety in the country that a large number of farmers are keeping heifers but, when they calve on one occasion, when the herd number has increased, they intend to discontinue the keeping of cows or heifers and return to their previous method of keeping dry stock only.

From the statistics that can be produced, it is difficult to know whether or not that anxiety is justified. However, we shall know in the succeeding years whether or not, along with new people coming along to increase their herds, we will have a decrease in the number of calves because of people who, having got the £15 and having increased their basic herd numbers, are getting out of the scheme. We can only hope that this will not be so and look forward to a continued increase in the number of heifers being mated.

The temporary beef export payment scheme, subhead K. 19, is something we welcome. The Minister is right when he says payments will not be large, that it is necessary in these operations to produce a flow of price. It is true some of our meat processing factories were finding it difficult to carry on with the rather minimal sum indicated by the Minister, together with his prognostication of what the losses will be up to June. We have succeeded in keeping these factories in operation. That is good and we welcome it. The payments are small in such a large industry and a good export is something which is pleasant to consider.

The question of butter and the extra price being received for it is something that should properly be considered here also. It is now two years since Fine Gael indicated that, because of the increased prices now available on the British market for butter, the saving to the Exchequer could be expected to be something in the order of 1d. and this should be given to the farmers. The Government afterwards followed our line and gave it to the farmers. It is true the saving of up to £215,000, arises out of higher prices for butter at a time when we are paying an exceptionally low price for milk. We hope the Minister will attend to the quality milk, as he has done in the past week or so. That is something that was suggested from these benches some two or three years ago. At that time I remember it was a source of merriment to the Fianna Fáil backbenchers, notably Deputy Corry, but I am glad the Minister has now fallen in with our line on this matter and says he is to pay a premium for best quality milk.

If as a result of the GATT agreement, whereby Britain has been limiting imports of butter by quota, we are to get a better price for butter, even though some is affected by temporary increases in quota, we feel this should be passed on to the farmer. He is hardly getting an economic price for his milk. If there is an increase in prices and it is reflected in savings, these should be handed out to the farmer by way of increased price for milk.

There is not much more I wish to say on this Supplementary Estimate except to repeat that the Minister has been extremely fortunate in the turn of the terms of trade. Butter has helped him. The fact that the Bovine Tuberculosis Eradication Scheme went on well is parallel with the fact that there were considerably higher prices for the slaughter of animals. The ledger in this case seems to have balanced in the Minister's favour. The total gravamen of this Supplementary Estimate is that there was a reduction of £25,000 if one removes the ninth round of wage increases which is properly paid to officers of his Department.

Mr. McQuillan

I welcome the Minister's statement about the speedup in the Bovine Tuberculosis Eradication Scheme. I hope, like other Deputies, the momentum will continue so that there will be no delay in bringing it to an end. A Supplementary Estimate is not a proper Estimate on which to indulge in wide discussion, even though the matters on which I should like to speak are contained in this Estimate. Therefore, I propose to be brief.

In connection with the Calved Heifer Subsidy Scheme, I note the Minister has suggested that the benefits of this scheme have been widely diffused throughout the country, and particularly in the western counties and the smaller holdings. I should like the Minister to elaborate on that in his reply. If we follow up the Minister's remark that "the average individual grant works out at £37, representing over two animals per herdowner", that average was worked out I gather from figures taken all over the country in respect of the biggest herdowner down to the smallest. On that basis, I should like the Minister, seeing he has been able to get figures on the lines given here, to give a breakdown to the House on the average given to farmers with a valuation under £20. Then we would see where the real benefits are and who is really benefiting by this particular scheme.

I maintain, and I shall repeat it again and again, that the small farmer, particularly the small western farmer, is not benefiting to the extent the Minister is seeking to suggest. I am open to contradiction by the Minister, provided he gives statistical proof to back up what he has said here. How can you compare a herdowner with a valuation of £15 on a small holding with a man of £300 valuation, and the number of cattle both have, and work an average of £37 as representing two animals per herdowner. I think the Minister is not being fair to his Department in giving a figure like that unless he is prepared to segregate the payments according to the valuations.

Another point I should like to mention is the Minister's reference to the State subsidy or aid now being given to the dead meat trade, the factories in operation here. Let me say the Labour Party are very anxious to see this particular line of agricultural processing developed to the maximum. I note the Minister has taken the opportunity of stressing that this industry has developed without State assistance. I do not know what he wants to convey to the general public by that. The fact is he is coming in here looking for State assistance for the particular industry.

Mr. Haughey

I meant they got no Foras Tionscal grants or anything like that up to now.

Mr. McQuillan

They are getting them now. I do not think there is any point in the Minister's stressing "without State assistance" if at this stage they need it. The point is they are highly desirable industries. There are areas in the country where these industries should be established and the Government should have taken cognisance of the necessity and established these processing industries in the particular areas which are suitable and where the employment content is available. I can think of nothing better as an industry for a county such as Roscommon than a dead meat trade. The county is noted throughout the length and breadth of Ireland for its cattle production. If there were to be a dead meat trade, which is highly desirable, I believe that county is the place in which to establish a processing factory for that industry.

The Government are not too late yet. I believe this trade will expand and I think it highly desirable that the maximum expansion should take place. After all, we have the situation that at this stage nobody wants to harm the store cattle trade. At the present time it seems to be our main lifeline with Britain but, as far as employment content is concerned, it is not the best lifeline. It is not the best production line from the land, particularly for the smaller farmer. It may be said that it is a traditional part of our economy, as the Minister has said. Everything that is traditional is not necessarily the wisest type of line to pursue for the future. The Government have had traditional views over the past 40 years on certain matters and they were not long changing them when the time came to do so.

The store cattle trade, to my mind, is not the best line for the small farmer in any part of the country. The Minister should take every possible step that is open to him without damaging the economy to wean the small farmer away from this least productive line of agriculture. I see a small farmer at a fair in Roscommon, or in any part of the west, selling two or three beasts which are bought for the midlands for direct shipment to Britain without any employment being given in the country, barring the farmer looking at the cattle in the field, and I find that that farmer has two or three sons who must go over to England with the cattle and the sons work in British processing factories on the very cattle the father sold at the fair. We know that the by-products of cattle are far in excess of the meat value so that the employment given in processing the by-products in the cattle industry is of the utmost importance and whatever processing has to be done should be done here.

The Minister should realise that the people in the dead meat industry do not give a damn about the economy but are engaged in it for the profits they are making. The Minister has a primary duty to see that the maximum development takes places in this industry, even if it means much greater State intervention. When I say State intervention, I mean that the State should have a certain amount of control which it could exercise over the industry. I did not think this Government should have any qualms now as far as the public are concerned about pursuing a more socialistic line in this regard. The Government have taken over control of the outlet for our cattle; the shipping lines are now in the hands of the State. I am glad that has been done. It is only a step from that to see that, if necessary, in regard to the outlet, some of those people who have had it very good for years without doing any great work should realise that the State can also intervene on behalf of the producer. We have the State intervening on behalf of the producer in the beet industry and there is no outcry. The farmer is protected and the consumer is protected and we have first-class markets obtained by the people employed by this State company. As far as the dead meat trade is concerned, the Minister should take the necessary steps to set up a meat marketing board.

I know that there are people who will say that this is a question of the State intervening for the sake of intervention, for some particular philosophy. As far as agriculture is concerned, it has been left, willy-nilly, on the basis that there has been no proper planning for its development on intelligent lines and on such lines that the farmer may have confidence that when he produces he will have a market for his goods. We talk at present about the availability of the British market and that there is a first-class market there for our cattle, but the fact is that no Government and no political Party can take credit for the demand in England for our cattle, or our lamb or anything else. The British housewife has been the deciding factor and it is her demands that are being met. Perhaps a certain amount of skill was involved in negotiating with the responsible people in Britain but the fact remains that the demand is there and it is up to us to meet it in the best possible way so that the best price is given to our producers and at the same time the maximum amount of employment given at home.

The Minister has set up his pilot schemes in the west and is to examine what can be done to improve conditions for people on small holdings. He has visited the west recently and, being the intelligent man he is, he will realise that the small holdings in the areas he visited will not give a living to a farmer and his family if they persist in having as the main source of their income the production of store cattle. It should be said, and repeated again and again, that there is no future for them in that, and let tradition be damned. They only produce the store cattle for finishing off in the midlands and they have been at the beck and call of the jobbers and buyers from Kildare and Meath and elsewhere, tipping their hats to the so-called gentlemen at fairs as if the small farmer of the west had to thank these people for taking the cattle off their hands.

I often thought it was a disgraceful performance to see, outside some country hotel. this line-up of small farmers waiting for the gentlemen jobbers until they were ready to pay for the cattle they had bought that day. I am convinced that the small farmer had the impression that they would never have sold their cattle except that Mr. X had appeared at the fair. And you could see Mr. X with a big sombrero and with a big cigar about nine inches long and all the farmers are expected to——

Mr. Haughey

As long as it was not a cigarette holder.

Mr. McQuillan

I am not talking about a cigarette holder. I am talking about what I have seen. When I spoke about this matter to these farmers and said that they should be more independent, I found I was treading on dangerous ground and I know that possibly I am all the time, as far as the political end is concerned. However, it has to be said. The younger farmers have not the outlook that many of the older men have with regard to the sale of their cattle.

The Minister will have to change his views, as expressed in this document, about the small farmer. He seems to suggest in it that this heifer subsidy scheme is of particular benefit to the smaller farmer and to the farmers in the pilot areas which he has visited. If he does, then he is contradicting himself on the issue as to why this type of industry on the land is the most important and should be the No. 1, as far as the small farmer is concerned.

I will not deal in any detail with the butter problem but I will say this. I do not know what the Minister's mind is so far as the milk prices are concerned. If he is going to be fair again to the small producers, he should tackle this problem of milk prices on the basis of a higher price for a limited amount of milk so that the small farmer, at any rate, will get the top price for good milk up to a certain volume or for a certain production end of it. After that, I would consider it not unreasonable that a second price be fixed for milk over and above that figure. I do not know what the Minister's views on this are. I know it has been put to him before but I believe this is the proper way to face this problem. I should like to hear his views on this as well.

Mr. P.J. Burke

I welcome this Supplementary Estimate. I just want to say, first of all, that I agree with what Deputy McQuillan has said in regard to the small farmer who is dependent on store cattle, whether he is near Dublin or in any other part of the country. If he is living on a small holding of land, he is not living as a man should. While the present Minister for Agriculture is a highly intelligent man, a man with many resources of intellectual ability, I want to say this is one of the national problems we have to face. The problem of the uneconomic small farmer with a small holding of land is a national problem. The man who has all his eggs in one basket and who is depending on store cattle will not make a living. He can make a living only if he has a big holding of land. When a man has a large holding of land, it does not always pay.

In County Dublin small farmers are greatly dependent on market gardening, the production of milk or other subsidiary products. The standard of living of the small farmer in the country is, on the whole, very low. That happens where they are completely dependent on store cattle. We have often spoken here of establishing pilot schemes and co-operative movements. That is something worth following up because the co-operative movement will have to come in order to uplift the standard of living of the small farmers. In my young days, the woman of the house kept the home going with eggs, butter and pigs, along with the farmer doing everything he could to have all the tillage possible on his land. If he had stock, it was fed with the produce of the farm. That economy kept generations of Irish people alive in small farms throughout the country. They were completely self-supporting. That trend has gone. I remember in many parts of the country everybody produced pigs. There was plenty of fodder there. There was plenty of butter and the people were self-supporting. They were fairly good tillage farmers. They tried to produce everything possible.

That trend seems to have gone. I admit the population has gone down in rural Ireland. It has gone down, not alone in rural Ireland, but in rural parts of other countries as well. The trend of moving to the cities and towns is prevalent, not alone in this country, but in other countries throughout the world. I have often thought deeply about this matter. I see sometimes farmers who cannot afford machinery. They have not enough work for machines.

An Ceann Comhairle

I do not want to interrupt the Deputy but I would like to know to what item he is relating his remarks.

Mr. Haughey

He is concluding.

Mr. P.J. Burke

I am relating my remarks more or less to agriculture and the Supplementary Estimate here.

An Ceann Comhairle

The Deputy must confine himself to the items on the White Paper.

Mr. P.J. Burke

I will just finish with it on this point. The problem of the small farmer is a big problem. I am sure the Minister will try to take up this idea of co-operative farming. I am not going to get into it now because I will possibly have an opportunity at a later date. I welcome this Supplementary Estimate for £675,000. It shows the Government are solvent and that the country is in good hands.

I see the net expenditure from the Vote for the Department of Agriculture is £30,999,700. This is a very fine Estimate. It shows the policy of our Party is to put all the money the State can afford into agriculture to try to help those people in every way we can. That has been our policy since we started and I am delighted to see that that policy has been continued.

With regard to the Bovine Tuberculosis Eradication Scheme, I want to congratulate the Minister and his predecessor on the progress made. I notice that by the end of March a total of 33,700 reactors will have been taken up. This compares with the total of 115,000 reactors taken up in 1963/64. I notice the compensation paid since 1st April last has been £68 for cows and £59 for other cattle. The corresponding figures for the previous year were £58 for cows and £47 for other cattle. We all welcome these figures.

Deputy Donegan spoke on the calved heifer scheme. It must be seen that we have succeeded beyond our expectations in this matter as a Government and as a Party because we have paid out the total provision in 1964/ 65 of £3,155,000. This shows, no matter how pessimistic one is, that we have many more cattle in the country. If this goes ahead according to the present expectations of the Minister for Agriculture, by 1968 the figures will have gone up 65 per cent. That is a wonderful target to look forward to. The only thing which would destroy that would be a change of Government, but please God, the people of Ireland will have sense enough to realise that will not happen until such time as we have tried to put our farmers in a happy position economically and otherwise. I notice that the figure in respect of export of dead meat is almost £23 million. This is an innovation that has started over a short period of years. That is a very good position for the nation. On the other hand, the store cattle trade has increased this year because——

Mr. Dillon

You stopped cutting their throats.

Mr. P.J. Burke

The Minister said that exports of store cattle increased from 565,200 in 1963 to 637,000 in 1964. He said that a falling off in the number of cows slaughtered, arising from a number of factors, led to a serious decline in the export of boneless beef to the United States. There is no doubt as Deputy McQuillan said, that our dead meat trade will be a great asset to the nation if we can develop it. On the other hand, over the years, we have been delighted to have our traditional store trade. So far as we can, we must try to increase our store trade and our dead meat trade, and that is what the Department of Agriculture and the Minister have set out to do.

The Minister is doing a very good job. I do not wish to delay the House by going into more detail. This is a very encouraging document and it is encouraging to see that the nation can afford to do things we have all dreamed of, in an effort to improve our agricultural economy, and to improve the lot of our farmers generally. In that way we will be improving the nation as a whole, because agriculture is one of our great assets, and it helps us with our adverse trade balance. Everyone is concerned about agriculture, from the young man in the streets of Dublin to the young man standing at the corner in Castlebar. We all depend on our export market, and it is wonderful to see that our cattle exports are going strong.

I am very proud to be a member of the Party who are so generous to the farmers. Any money the Government have they get from the taxpayers, and that money is being ploughed back for the benefit of the nation, and for the benefit of posterity.

Mr. Dillon

The Minister in introducing the Supplementary Estimate, which because of its nature limits the scope of our discussions to the subheads for which it makes provision, did not think it necessary to refer to subhead A, which I think is most remarkable. The Estimate for Salaries, Wages and Allowances, as revised by the First Supplementary Estimate for this Department, is £815,000. The Minister now tells us he requires an additional £700,000 for that subhead. I should have thought a proposal to double the estimate which his predecessor was responsible for introducing in the House at the beginning of the financial year would call for some words of explanation.

I suppose the truth is that in common with most other branches of the Civil Service, we are now realising the full impact of the inflationary spiral in which the Government are involved. Though we appropriate very large additional sums for the remuneration of the Civil Service, the net result is that the Civil Service are no better off than they were before we got involved in the tornado of inflation which is at present blowing. We cannot relate the individual remuneration of each civil servant here, but when we recall that the cost of living has gone up by 30 per cent in the past seven years, and when we recall that the old age pension of 37/6 today buys what 28/- would have bought seven years ago, I hazard a guess that the increased remuneration of the Civil Service today in fact confers upon them not much greater purchasing power than they had seven years ago. In this subhead there must be a very substantial addition to the total personnel of the Department. It cannot all be increased remuneration.

Mr. Haughey

It is the ninth round, and a number of status claims.

Mr. Dillon

It is a remarkable achievement to have doubled the remuneration of the staff of the Department of Agriculture in 12 months. I think this is an event over which the Minister cannot with propriety pass, when seeking close upon £1 million to finance it, without offering some more detailed explanation to the House.

I had the honour of being Minister for Agriculture in this country for two successive periods. In those days we took a particular pride in the Department in knowing our job. We liked to have our Estimates correspond accurately to what the event would demand. I like to look back on the fact that that aspiration was usually realised. What are we to say of a scheme introduced here by the Minister for Agriculture under Subhead K.14—Scheme of Grants for Calved Heifers—when we see that estimated expenditure for 12 months was £405,000, and actual expenditure for 12 months was £3,500,000? Someone has fallen down on the job. Either the Minister who formulated the scheme had not the remotest notion of what the scheme was about, or else he got estimates from his advisers of a far different kind from those I was accustomed to receive.

I think I know the explanation. The scheme was formulated without any conception of what it was all about, and without any clear idea of what it was intended to do. At this moment I very much doubt if the Minister has any clear view as to what this scheme will involve over the next four or five years. In the course of his statement he said:

The target for increased cattle production in the Second Programme for Economic Expansion would require an average annual increase in cow numbers of 75,000 up to 1968. This figure has been exceeded in the past year.

Where does he get that statistic? The only statistics available to me were the intercensal estimate as of 1st January and the more accurate enumeration associated with 1st June. The Minister takes out of the air— whence he got it, I know not—a figure of 75,000 which he says is somewhat less than the increase in the number of cows in the country—when, or in comparison with what period? The phraseology appearing in the statement, to my mind, means nothing and I think is just thrown in for the purpose of sounding doubtful.

I am bound to say that I just do not know how this scheme for calved heifers is working. I am perfectly certain that the figure mentioned by the Minister of an average individual grant which works out at £37, representing two animals per herd owner, is a piece of dissimulation on his part which is unworthy of a Minister for Agriculture. He knows as well as I do that an average figure of that kind has no more significance than if he had whistled Yankee Doodle. If you take, simply, the number of farmers and divide them into the total number of grants made, it means nothing at all. What would be meaningful is if the Minister told us—which he ought to be able to do—the number of herd owners who received grants for more than 100 heifers.

Mr. Haughey

Only 16 herd owners received more than £50.

Mr. Dillon

What about the number of herd owners who received between £25 and £50?

Mr. Haughey

I have already given this information.

Mr. Dillon

It would have been much more meaningful to furnish these particulars here than to say that the average individual amount works out at £37, representing two animals per herd owner.

Mr. Haughey

Only 16 herd owners in the whole country have received over £50.

Mr. Dillon

That is a significant figure, if the Minister went on to tell us the number of herd owners who received between £30 and £50, between £20 and £30 and below £20. These figures would mean something. I think he will agree that the average figure here means nothing.

Mr. Haughey

It does.

Mr. Dillon

I am sorry to say it was put in for the purpose of suggesting that the average grantee in this case is a man who got a grant for a couple of heifers.

Mr. Haughey

He is too.

Mr. Dillon

That is not so. The Minister has a duty to explain to the House how it was conceivably possible that the Minister for Agriculture could advise this House that a considered scheme which was to cost £405,000 in its first year has in fact cost £3,155,000.

I am glad that the Bovine Tuberculosis Eradication Scheme, which I am happy to remember I initiated is now reaching its final stages. I am hopeful that the Minister's ambition that the scheme, inaugurated in September, 1944, will be completed just over 11 years after its commencement, will be realised. On the whole, bearing in mind the magnitude of the problem that presented itself to us, particularly in the six south-western counties, that is not a discreditable performance. When we recall that we have carried the burden of that eradication scheme on our own Exchequer, compared with a number of our continental competitors who were facilitated in realising it by vast grants from the Government of the United States, I think the farmers of this country have reason to be proud of their achievement.

I have learned, with growing concern, of the virtual disappearance of what I thought always was a very valuable market, that is, the market we established, not without difficulty, in the United States for boxed frozen beef. I should be glad if the Minister would give us further particulars of the factors which have led to the very serious decline in the export of such beef to the United States.

I remember when that trade began. It began as a dual purpose trade. There was an export trade in prime carcase beef and this remarkable opening of a boxed boneless beef trade resulted mainly from an outbreak of foot-and-mouth disease in Mexico whence this class of manufacturing beef had largely been drawn. I remember prophesying at the time that the market for prime carcase beef in the United States was non-existent, that it was a matter of bringing coals to Newcastle to bring prime cascase beef to Omaha, Nebraska and Illinois but that boxed, boneless beef, which was used for conversion into salami and soup and such products in America, had immense potentiality, particularly in view of the extraordinary difficulty which the Government of Mexico and some South American Governments experienced in bringing foot-and-mouth disease under control. I think this market was worth something like £10 million a year?

Mr. Haughey

Yes.

Mr. Dillon

It grew from nothing to almost £10 million a year and it is now fading out. I have been told that the reason for its decline has been competition in demand from other sources. That is something we have reason to congratulate ourselves upon but I am at a loss rather to understand why we have not been able to meet whatever demand may have presented itself on the continent plus the demand in America.

Mr. Haughey

Fewer cow reactors.

Mr. Dillon

One would think there was a considerable volume of them still available and that there was still scope for the supplying of aged cows that are annually available here to take care of this trade. It is, of course, satisfactory if we can dispose of the meat more advantageously on the continent but we ought to bear in mind— and this would argue for the case made by Deputy McQuillan for a meat marketing board—that there has always been a problem in this country of drifting in and out of markets.

We have experienced, again and again, the problem in a variety of agricultural products of our marketing operations being completely frustrated by our failure to maintain continuity of supply. There is no doubt whatever that we had built up in America a very high reputation for the quality of Irish manufacturing meat to the point that we even had cases in which the boxes in which this meat was exported were being used a second time by illegitimate traders who were putting inferior products into them in order to trade on the excellence of the reputation of our product.

I am dismayed that a market, worth £10 million, which was built up in the United States and which my Government had every prospect of continuing suddenly vanished overnight because we switched our supplies elsewhere. I am by no means certain the same continuity exists in the continental markets to which we have now diverted our supplies and I should be glad to be reassured by the Minister that, in his judgment, the alternative market which absorbs the bulk of our supplies holds out the same prospect of continuing demand as the American market undoubtedly did particularly as we had established our reputation in manufacturing circles there as a source of very reliable quality-manufactured meat.

We have now for the first time engaged in the subsidisation of beef exports and, superficially, that seems to be an unexceptional course. I should like to hear the Minister's views on that. I remember very well when we negotiated the 1948 Trade Agreement, there were two courses open to us and a very definite choice had to be made between them. We could enter into competition with the British farmer in what they regarded as their traditional domestic market for meat. Remember our meat is not like Argentine meat: our meat was identical in quality with British or Scottish beef. Or we could adopt the line that instead of constituting the British farmer a powerful vested interest in opposition to our interests in the British market, we should make them a powerful vested interest more and more dependent on the supplies of store cattle which they drew from this country. We deliberately took the view that it was very much better to mobilise the National Farmers' Union in England as a powerful vested interest in support of our livestock trade than to array them against us as a powerful vested interest gravely apprehensive that we would go into competition with them and possibly beat down the level of prices available to them in their own domestic market.

I remember distinctly arguing at length with the then Chancellor of the Exchequer, Sir Stafford Cripps, and Mr. Tom Williams that two beasts slaughtered in England should be paid for on an identical basis without regard to where they were calved. I remember very well, in the course of the negotiations, the Chancellor of the Exchequer who was leading the British delegation, turning to his own officials and saying: "I think the Irish Minister for Agriculture is right and that we must concede this." So it was done, and for the past 17 years we have enjoyed the advantage of what are called deficiency payments paid by the British Government to British farmers through the store cattle trade and I have no hesitation in saying that today, or certainly in the recent past, Irish farmers are or were getting £20 per head more for store cattle on account of the fact that they had this right to participate in the deficiency payments paid by the British Government to British farmers under the terms of that Agreement. I know that Agreement was somewhat abridged when the British required our cattle to be three months in Britain before they qualified whereas originally they only required them to be there one month.

How far do we intend to go in this business of subsidising exports of carcase meat? Do we aim to substitute, on any substantial scale, the export of carcase beef for the export of store cattle and, if so, where are we going to send them? Do we plan to export them to continental Europe because I should be very much surprised if it will long continue to enter the British market carrying a substantial subsidy from this side without producing a reaction gravely inimical to our livestock trade? These are paths that should be trod with caution because there was a time when certain people here did not appreciate the value of the livestock industry to our economy.

I think there are very few people who are so obscurantist as to misunderstand the significance of that industry today. It would be a very grave catastrophe for us if this or any Government in Britain were persuaded by the powerful vested interests representing the British farming community to alter the attitude they have maintained to our livestock industry since the 1948 Agreement. I want to emphasise that the terms of that Agreement have come to be understood by the British farmers as conferring very material advantage on them and it has become a very vital interest to the livestock feeder in England to maintain their source of supply of the kind of store cattle we have to offer.

That has been a very powerful interest operating in our favour in a very vital matter. When I look back on the years of effort and the millions of money that we put into the business of raising the standard of our cattle I often wonder what effect the promiscuous grants under the Calved Heifer Scheme will have on all that work. I think the Minister could, with benefit, ask some of the more experienced officers of his Department to tell him the story of how we began by the importation of bulls from abroad to improve the standard of our cattle and how we eliminated the scrub bull. I hope, in the events that followed, we have not introduced the scrub heifer because, mark you, production of livestock involves not only the bull but the heifer as well.

There was a time when people here were very anxious to ensure that any heifer-in-calf was calculated to produce the kind of calf or yearling that would readily sell to a discerning buyer. I doubt if that criterion has applied during the past 12 months. During that time I believe anything capable of conceiving has been induced to conceive by the fact that for the first time under any scheme operated by our Department of Agriculture, production has been promoted without any reference to quality. These are dangerous roads to travel and they are roads which I think may often be embarked upon by people with a very imperfect knowledge of the background on which they are working.

I should like to know from the Minister where he expects the bulk of the subsidised carcase meat exports to go. Will they go to Great Britain?

Mr. Haughey

Probably to Great Britain.

Mr. Dillon

It is only subsidised to Great Britain and there is no subsidy on these exports to the continent of Europe?

Mr. Haughey

No.

Mr. Dillon

May I ask why?

Mr. Haughey

It would take me some time to elaborate. Because of the guaranteed payments scheme.

Mr. Dillon

I see that, but it seems odd to me that, if we are subsidising exports of meat to Great Britain simply because there is no immediate reaction to it, exports of carcase meat to Sweden or to Germany or to France or to any other continental destination would not carry a similar subsidy. In fact, I believe if exports to these destinations could be effectively achieved by this procedure, there would be a more powerful argument for it than for the attempt on our part to offset the beef subsidy scheme operated by the British Government in favour of their own farmers. I should be glad to know from the Minister what he believes the reaction of British farmers will be if this new export subsidy scheme should expand on any basis comparable with the expansion that has taken place in the scheme of grants for heifers. Suppose this was a tearaway success and we began to flood the British market with carcase beef and starved it of store cattle, what does the Minister think would happen? Remember, if anything does happen, it will be too late to take remedial measures.

I should like to know where we are going and I should like to know what considered line of policy underlies this new departure. I knew where I was going when I was Minister for Agriculture and the Government of which I was a member knew precisely where we were going. I think, in retrospect, the decisions taken then have been more than justified by the event. I think the quality and the volume of our livestock today have been an immense stay and prop to the economy of the country. I would hate to see that trade disrupted. It depends almost entirely, let us not forget, on the goodwill of the British farmer and when we speak of the goodwill of the British farmer, we are merely employing a euphemism for the self-interest of the British farmer. So long as our store trade with Great Britain serves the fundamental interests of the British farmer, it has a brilliant prospect; the moment it ceases to do so, I cannot see it surviving.

Mr. Haughey

I agree with you now.

Mr. Dillon

Very well.

Mr. Haughey

I think you were being a bit romantic up to now.

Mr. Dillon

I am not being a bit romantic; I am being extremely pedestrian. The fundamental difference between the Minister and me is that I have some experience of it, the Minister has very little, and what I am apprehensive of is that we will embark upon adventures the end of which we have not anticipated or worked out.

I do not know what the Minister is aiming at in the subsidy for beef exports and he has not told us. I am putting the question now: Suppose the volume of beef exports grows beyond his wildest anticipations, with consequent diminution in the supply of store cattle, what does he think the consequences of that will be?

The last word I want to say is this: There is no more poisonous heresy in regard to the agricultural industry in this country than the rubbish that is talked about the small farmer being impoverished by the production of store cattle. That is the kind of theoretical codology with which people who do not understand how our people live can bewilder themselves. The number of farmers who confine their activities to the production of store cattle is microscopic. It is like the fable of the man and the dog and the stick.

I remember the time when we used to be told in this country that the store bullock was the greatest enemy of employment that existed on the land of Ireland and that until we had every acre of land growing wheat, there would be no employment on the land and it was hateful heresy to say that the growing of wheat will end employment on the land and the removal of the livestock from the land on which it grew will substantially reduce employment on the land. But most of the people who were bursting to grow more wheat lived to see the day when wheat became the great destroyer of employment on the land. They saw the contractor come in, plough up the land, sow the wheat, go away, and put a chain on the gate until he came back in the autumn with his machinery and saved the wheat and removed it mechanically to the mill or to the grain store, without the employment of practically a single creature, but the man who kept cattle or the man who kept pigs or the man who kept sheep had to employ men.

What small farmer in Ireland spends his time producing nothing but store cattle? That is one of the nonsensical illusions but it is an illusion upon which appalling mistakes could be built up. No small farmer in this country can long survive who does not engage in mixed farming and he can never long survive if he does not produce a wide variety of products on his land the bulk of which he walks off. It is the conversion of the crops he grows on a small holding into livestock of one kind or another, whether it be cattle, pigs or sheep, that makes it possible for the small farmer to remain on the land and to prosper on the land.

Let us make up our minds to this: no small farmer in this country—and I mean a man with 45 acres or less— is ever going to enjoy the monetary standard of life which can be purchased in industrial employment in Great Britain or the United States of America and there will always be a certain number of people born in rural Ireland who will consciously make the choice of turning their backs on life on the land and choosing to live in Birmingham, Belfast, Dublin, Cork or some other industrial environs but it is equally so that there will always be a sufficient number of our people who, given a reasonable standard of living on the land, will prefer to live as property-owning farmers in their own holdings.

These people are not only of incalculable value to the economic life of this country but they are one of the most valuable elements of our social structure. We ought to apply our minds to the task of consolidating and strengthening the position of the small property-owning farmers, whether they are in the north, north-west, south, west, south-west, or indeed in any other part of Ireland. None of them who have any prospect of survival engage exclusively in the production of store cattle. Practically all of them who are destined to prosper and rear decent families on the land will, in conjunction with other activities, produce store cattle, and if they do not, they will not succeed.

These are two generalisations which will cover 95 per cent of our small farmers. You will find the exception that proves the rule, the man who produces soft fruit or the man who produces specialised crops here and there in different parts of the country. They are the exceptions that prove the rule. The long-term prosperity of our people on the small holdings is associated with mixed farming, of which the production of cattle constitutes the linchpin. It is mischievous and dangerous to promote this nonsensical heresy that the production of store cattle on small farms is a means of beggaring the farmer. The livestock industry is the sheet anchor of our industry, as agriculture is, in the last analysis, the sheet anchor of our economy.

I suppose any Minister entering a new and exciting Department, as the Department of Agriculture undoubtedly is, must be pardoned if in his salad days, he thinks he can break ice with a stick. I do not complain of that. I do not think it is an altogether evil thing if one is sometimes a little more adventurous than mature prudence would allow, but, having made one's attempt to break ice with a stick, do not start breaking up the furniture in order to get a stouter stick to break the ice that will not give way.

If there is some temporary reason for this new departure, well and good, but if anyone is toying with the idea that we should drop the store cattle trade in the belief that we can substitute for it the carcase beef trade, he is walking a road that leads to certain ruin because he will find that he will create, where there was a powerful vested interest in our favour, just as powerful and a far more ruthless interest to frustrate us.

I do not congratulate the Minister on Estimates that bear no relation to those originally submitted to the House because I think it suggests that he does not know what he is about. However, I must add this: there has been a change of Minister and the original Estimate was presented to us by the present Minister's predecessor. I am not making him personally responsible for the wide and wild discrepancy that manifested itself in Subhead K.14. However, it is the responsibility of his Government because I know the history of that transaction. That scheme was formulated to purchase a vote in this House without regard to whither it led, what it was going to cost or what it was going to do. That may be good politics but it is not the right way to run the Department of Agriculture. I should like to think that when I was Minister for Agriculture nobody would suborn my interest in that great Department and all it represents in the life of this country to a cheap political trick. I hope it will not happen again.

Sir Anthony Esmonde

The coverage in this Supplementary Estimate is pretty wide, but it appears to me, glancing at it, that the emphasis is on beef production. I noticed with interest recently that the Minister has been making a tour of continental Europe and that he has also been in contact with his opposite number, the Minister in charge of agriculture in the United Kingdom. It is nice to know that finally the representative of agriculture in the Fianna Fáil Party has come down to the basic fact that beef production is the life of our economy. This Supplementary Estimate is an indication of thinking on those lines and for that reason I welcome it.

First of all, to deal with bovine tuberculosis eradication, I should like the Minister to give the House some indication as to the success of that scheme. Admittedly, we have got to the stage in which we are dealing with the last six counties—the six Munster counties are the only ones that have not been attested so far—but there is, at the same time, a growing number of reactors in the areas already attested. I do not think that is peculiar to any county. My own county produces a lot of livestock and quite a few people have found to their surprise that reactors are cropping up again here and there.

As regards this problem in other countries, particularly in Scandinavia where they have been for a long time working on the eradication of bovine tuberculosis, they find that having got clean herds—the country is considered largely to be free of tuberculosis—the disease has an uncanny habit of turning up again. It is a recognised fact that if a bird flying over a herd drops a piece of infected dung on that herd, the infection will go through it like a prairie fire. I should like the Minister, if he has any statistics available or any knowledge on the subject, to indicate to the House that he is entirely satisfied that when we do eradicate tuberculosis, we are finished with it for all time. We spent a sizeable sum on this and we spent this money purely for the purpose of the store trade.

My views on the store trade do not diverge very greatly from what Deputy Dillon has been saying. We are largely dependent on the store trade. We are largely dependent on what we can export to the United Kingdom to get the finance necessary to buy the raw materials for our industries. At the same time—this is my personal view—I do not subscribe to the opinion that the store trade is the be-all and end-all of our beef production.

We have got to learn that New Zealand, a country largely parallel with ours in its production, its size and its agricultural community, is exporting beef across the world, selling it to Nigeria, one of the countries in Africa which has a purchasing power. If the New Zealanders are able to export their beef that distance to a country where there is a growing demand—it is only one of many—it is obviously easier in a modern world to export what you have got if you process it and ship it in a more easy fashion than is possible in the case of live animals.

I should like to reiterate my view that it is fundamentally essential for our economy that we maintain our store exports, but at the same time I submit we should concentrate as far as is possible on the processing of beef to enable us to expand and diversify our market. I am one of the people in this House who perhaps might not be accused of being anti-British. I have had it yelled at me in debates that I am supposed to be pro-British. I do not know whether I am or not. I feel very strongly in relation to our trade agreements with the United Kingdom.

I remember some few years back, only about eight or nine years ago, when beef was not in such demand as it is today, when we farmers in Ireland who are beef farmers, of whom I claim to be one, had the greatest difficulty in selling our produce and the British were not so keen to buy from us. Today there is an unlimited demand for beef. From the opportunities I have had of studying the situation as a member of the agricultural arm of a UN body, I am satisfied that the demand will last into the foreseeable future.

There is a great demand for two agricultural products. One is beef and the other is forestry produce that comes off the land. Anything that aids us to build up our trade in processing and exporting beef is advantageous to us. It seems to me there is practically only one country in the world looking for absolutely first-class beef. That is the United Kingdom. It has always been a theory in Britain that fresh beef, Irish beef that is killed there, is what they want. Against that, we must consider that we are competing today against chilled beef, a different thing from the produce we had to compete with in days gone by. We are moving into a changing situation. For that reason, if we bring as much beef to maturity as possible, always providing we do not destroy our existing store trade, we shall be taking a step in the right direction. It is a known fact that all over the world, perhaps to a greater extent elsewhere than here, there is less employment to be had on the land than heretofore. Therefore, the great risk we run is that if we continue on the existing lines, we will syphon more people off the farms here into the towns and cities, and I do not think we are sufficiently developed yet, nor do I think our future is sufficiently assured with the somewhat uncertain conditions that prevail in marketing and economic agreements in Europe and other parts, to absorb those people into employment.

For that reason I cannot help feeling that beef in the foreseeable future is likely to be the basis of our raw material for the building up of an industrial arm based on agriculture. My personal view from experience gathered is that anything that helps to encourage our farmers economically to finish their beef is to the advantage of the nation as a whole.

Where does the small farmer fit into the picture? If stores are a very high price, the small farmer who breeds them and who is the bulwark of the store trade in this country will get better prices. Against this, we are told Government policy is largely to eradicate the small farmer, to increase our farm holdings. I fear the time will come when the small farmer will be forced to buy stores the same as I do, the same as the bigger farmer does, the same as the Minister himself, perhaps. I do not know how much land he has but I do know he keeps hens.

A stable price is therefore indicated. What I am trying to convey to the House is that I place no great reliance on the British market as such. I do not think any Deputy can really feel the same respect for any trade agreement, any purchasing power the United Kingdom may have because of the treatment meted out to us recently. Accordingly, we must look to ourselves in the future to ensure that we are able to produce what is most advantageous to us.

To sum up, I think our exports at the moment to the United Kingdom in beef —in fact our exports to any part of the world—are somewhere in the neighbourhood of 80 per cent, excluding the boned beef which we export to America. Of that our finished beef exports would be perhaps 20 per cent. It is desirable that in the course of time we would gradually evolve a situation where we would increase our finished beef exports so that we would not be dependent on restricted markets. We should, at the same time, gradually reduce our store trade, being mindful of what Deputy Dillon said—it was fundamentally sound and true—that the small farmer is dependent on the price he gets from the early beef he produces, from the store trade.

I do not think there is anything more I wish to add except to point out to the Minister that what the small farmer really needs to help him to meet the requirements within this Estimate is more facile credit. The position at the moment is that the banks are not ready to lend money. They seem keen to give money for anything except the purchase of livestock. Farmers who have survived all sorts of vicissitudes, who have built themselves up, who have improved their houses and farm buildings and are in a position to increase their stock, are tied down for credit. The Minister must direct his mind to that. Beef, after all, is the future of Irish agriculture. It always has been and it always will be if the Minister will move to revise the credit situation.

Mr. T. O'Donnell

I shall not detain the House more than a few minutes. There is very little in this Estimate which is of direct concern to the farmers in the constituency I represent, particularly the dairy farmers. There are one or two matters in the Minister's speech upon which I have expressed strong views in the past and, lest it should be thought that I have changed these views, I want to say a few words now in relation to these matters.

The Minister was at pains to extol the merits of the Calved Heifer Scheme. On every occasion on which I have spoken on this scheme in this House, I have expressed myself as not being in favour of it. I made that clear last November and I put forward the suggestion then that a much better approach to solving the problem of increasing cattle numbers would be a calf subsidy. The Minister on that occasion pointed out that such a scheme would not be possible and that considerable difficulties stood in the way of the implementation and administration of such a scheme. Since then I have discussed the matter with various dairy farmers and I am now more than ever convinced that the present calved heifer subsidy scheme is not the best way to approach the problem of increasing cattle numbers.

The Minister talked about the average figure. An average figure means nothing. The Minister said only a small number received substantial payments in respect of the scheme. From my experience of County Limerick this scheme cannot be said to be of benefit. Its benefits have not been widely distributed. I have no doubt whatever about that. A calf subsidy scheme, on the other hand, would provide an incentive to the small farmer to rear calves.

Mr. Haughey

Does the Deputy know the figure for County Limerick?

Mr. T. O'Donnell

I cannot recall the total sum paid but I do remember that the average worked out at about two per dairy farmer. That would be £30. That coincides to a certain extent with the average figure. Taking 10,000 dairy farmers in Limerick, that would be £30,000.

Mr. Haughey

There were 3,200 grants to herd owners involved in the scheme up to 28th February. How then can the Deputy argue its benefits are not widely diffused?

Mr. T. O'Donnell

I believe an average does not give the true answer. I live in the heart of a dairying area. I have made my own observations. I have made inquiries at cattle marts and so forth. I have been surprised at the number of farmers who did not avail of the scheme at all. The picture, as far as I can judge, is that a certain number of farmers qualify for anything up to 20. But there are numbers who have not qualified for any benefit at all. The farmers' organisations in the creamery areas are convinced the calved heifer scheme is not a good idea.

The Bovine Tuberculosis Eradication scheme is now drawing to a close, particularly in the six southern creamery counties. The figure given by the Minister in November was 31,000 reactors sold to the Department to the end of March; it is now apparent that a total of 33,700 will have been taken up. That is a good thing. There is just one point: the Minister knows I have had to make representations with regard to the price offered for reactors. Other Deputies have also made representations in this regard. I have had experience, and so have other Deputies, of farmers in the creamery areas disagreeing with the prices offered by the Department. After lengthy representations and visits from three or four different valuers the prices were increased. As the final stages are now being reached, I suggest the Department might be a little bit more generous. If they are, I have no doubt all reactors will be got rid of without any difficulty at all.

In the last paragraph of his speech, the Minister referred to Bord Bainne and said that the favourable trend in prices for butter had resulted in a smaller demand being made by Bord Bainne on the Exchequer than was estimated. I have paid tribute to Bord Bainne on a number of occasions. We find now that a saving of £215,000 is anticipated as a result of improved prices for our butter. At the moment there is considerable discussion in the creamery areas with regard to the subsidy being paid on milk for processing.

An Leas-Cheann Comhairle

I am afraid the Deputy is now travelling outside the ambit of the Supplementary Estimate.

Mr. T. O'Donnell

I am relating my remarks to Subhead N.

An Leas-Cheann Comhairle

There is no money being voted and it cannot, therefore, be discussed on this Supplementary Estimate.

Mr. T. O'Donnell

I welcome the progress made by Bord Bainne. We shall have an opportunity of discussing the matter I wish to raise in the near future. I believe further economies could be effected.

General MacEoin

I would move, Sir, that it should not be reduced so much.

An Leas-Cheann Comhairle

There is no money being voted under the particular subhead.

General MacEoin

But it is being reduced.

An Leas-Cheann Comhairle

No.

Mr. Haughey

I shall deal, first of all, with the points made by Deputy O'Donnell. He was the last speaker and his remarks are therefore fresh in my mind. I confess I cannot understand his approach to the calved heifer subsidy scheme. Deputy O'Donnell does not like the scheme. He says he does not think it is a good one. I can only conclude from that that he thinks it should be stopped. Deputy O'Donnell represents a milk producing area and the farmers in that area are benefiting considerably: 3,211 farmers in County Limerick have got £181,260 so far under the calved heifer subsidy scheme. Deputy O'Donnell, as far as I can gather, wants this to stop. He does not think it is a good idea. Up to 28th February, 1965, in the whole country, no fewer than 72,965 farmers got a total of £2,735,940 under this scheme. Deputy O'Donnell does not think this is a good idea.

Mr. T. O'Donnell

May I ask the Minister a question? Would he not agree that a calf subsidy scheme would be preferable and lead to a more equitable distribution of benefit to the small farmer?

Mr. Haughey

I would not. I already dealt with that aspect on the occasion when I introduced the other Supplementary Estimate last November. This scheme in our particular circumstances was decided on by all concerned in my Department and by the expert advice to which we had access as the most suitable and most beneficial. Deputy O'Donnell says he does not think it is the best way to increase cattle production. How can he possibly make that statement when the very success of this scheme has caused it to be criticised by his Leader, Deputy Dillon? There is no doubt that it has increased cattle production. During 1964 no fewer than 175,000 heifers were accepted for payment of subsidy. It is absolutely clear from the figures that cow numbers between June, 1963, and June, 1964, went up by 70,000. Maybe all that is not specifically due to the Calved Heifer Subsidy Scheme, but the greater portion of it undoubtedly is. When we come to January of this year, I have no doubt that the figures will show we will have over 100,000 cows over and above the numbers as at January, 1964.

If we were trying to estimate what this scheme is going to mean, I could understand Deputy O'Donnell saying that, in his opinion, he did not think it was going to do this or that, but the facts and figures are before us. Cow numbers have increased enormously and the scheme has certainly had the effect of increasing cattle production. You might argue it is too expensive or that we are getting these cattle numbers too quickly, but certainly you cannot say it is not having the effect of giving us more cow numbers and increasing cattle production.

Deputy Dillon was critical of the Scheme also and suggested it was introduced for political reasons. He said, in fact, it was concocted in order to procure a vote in this House. I hope all the rest of Deputy Dillon's reminiscences and prognostications are a little more accurate than that particular one. The records of my Department will show that this scheme was conceived and hammered out long before there was any question of procuring the particular vote to which Deputy Dillon refers. This scheme arose directly out of the publication by the Department of Agriculture of the Brown Book and the setting of the targets for increased cattle production and increased cow numbers in that Brown Book.

It was clear that if those targets were to be reached, some incentive had to be devised. My Department, in conjunction with the Department of Finance, evolved this particular scheme in preference to any other scheme which could be thought of. A calf scheme was considered but rejected. Because we had certain records available through the BTE Scheme, this heifer scheme was obviously the one to adopt. It was adopted on the basis of the targets set out in the Second Programme and on no other basis whatsoever. What is really worrying Fine Gael about it is that it has been so tremendously successful. I am happy we are spending far more money on it than we envisaged.

Mr. T. O'Donnell

You are spending it in the wrong way.

Mr. Haughey

Deputy O'Donnell again makes this what I can only describe as a silly interjection. He cannot on any basis establish that this is not a first-class, excellent scheme, availed of by no fewer that 72,000 farmers. Deputy McQuillan was also interested in this scheme, and questioned me as to whether or not the small farmer was deriving benefit from it. Again, the figures show conclusively it is the small farmers who are availing of this scheme and getting benefit from it. In Roscommon, Deputy McQuillan's county, up to 28th February, 1965, 3,373 farmers got 7,712 grants totalling £115,680. No matter how anybody tries to disguise the facts, that £115,680 went into the pockets of the farmers of Roscommon in the form of cheques from my Department, money that would not otherwise have come. The fact that 3,373 farmers got 7,712 grants shows they got almost exactly two grants per farmer. In that county in particular, the national average is reflected. In the adjoining county of Mayo, to which Deputy McQuillan also referred, the figures are even more striking. There 5,895 farmers got 8,348 grants, much less than two grants per farmer, totalling £125,220—again a substantial sum of money going directly into the pockets of the small farmers of Mayo.

When I was down in the pilot areas of Roscommon and Mayo, I heard the advisers discussing with the small farmers there how they could secure an increased income from their small farms. When I heard them discussing the question of getting into milk, the advisers were able to point to this scheme and show what a tremendous help it would be to the small farmers in those pilot areas to get into milk—the fact that the farmer could have these £15 grants for every calved heifer brought onto his farm.

I agree with Deputy McQuillan and with Deputy Dillon that the answer to the problem of the small farms, whether in the west or elsewhere, is more intensive forms of production. I said in Limerick that we wanted to get the small farmers to build up big businesses on their small farms. By that I meant they have got to go into more intensive lines. Of course, the answer for the west is, in the main, milk and pigs. In that connection this Calved Heifer Subsidy Scheme is one of the best possible inducements we can offer to the small farmers of the west to get into milk for the first time and to the small farmers in other parts already in milk to increase their cow numbers and increase their income.

Deputy McQuillan asked me about a meat marketing board. I have already indicated to the House that this subsidy scheme for our meat exports is a temporary one. It is due to expire in June and between now and June, I have indicated that we shall carry out an examination of the meat and cattle industry, its prospects and its likely lines of development. The things, of course, one must keep in mind in regard to our meat and cattle industry are the arguments for and against the establishment of a meat marketing board.

Deputy Dillon spoke at some length about the 1948 Agreement and having the British farmers as a pressure group on our side. This is all romantic nonsense, completely out of date and irrelevant. He did touch on the truth on occasions when I interrupted him and said as long as it suits the British farmer to take our store cattle, he will take them, and, if it does not suit the British farmer to take our store cattle at the prices we ask, then he will not take them. All Deputy Dillon's great big myth about the inestimable benefits of the 1948 Agreement are, as I said, completely irrelevant.

Deputy Dillon dangerously overemphasises the whole position. He talks as if nothing else mattered but our store cattle trade. It is very important, we all admit that. It is fundamental to our whole livestock economy and, therefore, to our whole national economy. But there are several more aspects of our economy to which Deputy Dillon did not refer. He, for instance, completely ignored the fact that in order to have a store trade, you must have a milk industry. You cannot have cattle production without milk. What inestimable advantages has the 1948 Agreement conferred on us in this direction?

It is all very well to talk about the development of our store trade as a result of the 1948 Agreement, but the store trade is not the end of our whole agricultural perspective. We have numerous other agricultural products to be disposed of. There is such a thing as putting all your eggs into one basket. While we all recognise the value of our store trade to our economy, we must always have regard to these other vital sectors, particularly the milk sector. I want to make it clear that there is no intention whatever, by the introduction of this subsidy scheme for carcase meat to Great Britain, to injure our store trade in any way. This scheme was introduced as a short-term scheme to meet a specific short term situation. There is no doubt that the operation of the British deficiency payments system has a tremendous drawing power on our cattle population. By its operation, it drew into the store export trade increasing numbers of cattle which would otherwise possibly have been fattened in this country and would have been made available both to the live fat shipper and to our dead meat factories.

The numbers themselves are quite significant. Our exports of store cattle in particular went up in 1962, from 429,200 to 565,163, an increase of roughly 130,000 head. In the period from January to November 1963, they were 540,600 and increased in the same period of 1964 to 612,300. The picture was quite clear. The operation of the British deficiency payments system was having its effect on drawing increasing numbers of cattle into the store trade and ensuring that they were exported as stores rather than being fattened here. This places the dead meat factory here in a very perilous position. There were not sufficient fat cattle coming on the market here to keep the factories going, so this scheme was carefully devised to ensure that to some extent cattle which were going out of store would be retained here by our farmers and fattened and would go on the market and be available for purchase either by the fat shipper or by the dead meat factory man. We hope it will have that effect. That is the purpose of it.

I think it is ridiculous nonsense to look upon it in any way as a threat to our store trade. There is no doubt that we are now well on the way to reaching the target set in the Second Programme for Economic Expansion. These targets involve the annual output by 1970 of 1½ million head of cattle. In the context of that target, 1½ million cattle, there will be plenty of room for our store trade and for our dead meat trade. There will be plenty of supplies available to both these trades, and we would be foolish at this stage, in the light of these forthcoming cattle numbers, to let our dead meat trade go to the wall. There must be some limit to the number of our cattle that can go out as stores. When we get these increased numbers in annual output, we have got to envisage a certain proportion going out as carcase beef. I hope there will be plenty of supplies for both these trades. It would be a national disaster for us now, in the light of this development, to let the dead meat trade go to the wall and not have it available when these increasing numbers are due in the years between now and 1970. There is no doubt, and all the indications are, we will get these increased numbers we are planning for.

Deputy Dillon asked about the boneless beef trade to the United States. Naturally we are disappointed about the present position in that regard. This trade had been built up to very valuable proportions and the reputation established for our meat was excellent. We had very excellent trade connections and all of us would be very anxious that this trade would continue, but, unfortunately, the situation is that at the moment it has declined considerably. It has declined because there has been a reduction in the number of cows coming forward, both because of the tailing off of the BTE scheme and the reduction in the number of cows coming from Northern Ireland. This has taken place side by side with a tremendously increased demand for our cows for manufacturing purposes on the continent of Europe. I do not know what the future of this boneless beef trade to America is going to be. We all hope the circumstances will change and that it will be possible to revive it because I agree with Deputy Dillon that it is a very valuable outlet.

I fully agree with him that the important thing to do in all our export markets is to try to build up continuity and try to expand and develop a particular market and not to be chopping and changing and switching from one market to another, but the situation is that that demand is there in Europe today for these cows and the prices are being paid for them and we could not prohibit their export to the continent of Europe, or contemplate denying our farmers access to these good prices that are being paid, so that unfortunately there is, as of now, at any rate, nothing in particular we can do about this particular trade.

Deputy Dillon mentioned that he had been Minister for Agriculture and spoke of or implied his knowledge, experience and maturity in all these matters, but I am afraid for one so experience and knowledgeable about the Department of Agriculture, he committed a very simple but unforgivable little error in regard to the salaries paid by the Department. He spoke as if this £700,000 for which I am now looking for salaries, represented a doubling of the salary bill for the Department. Of course it does nothing of the sort. The total salaries paid to the Department of Agriculture before the ninth round were somewhere in the order of £2 million. Despite his knowledge and experience of the Department, Deputy Dillon apparently overlooked the fact that Subhead A covers only some of the salaries, that the rest are distributed throughout the various other subheads, and that in fact all we are dealing with is an increase of £700,000 roughly in relation to £2 million.

Mr. Crotty

The original sum was £815,000 and the increase is £700,000 so that the increase under that subhead is nearly 100 per cent.

Mr. Haughey

No, it is not. The £700,000 represents £250,000 for the ninth round and £450,000 for status claims for salaries under all the subheads which amount to well over £2 million.

Mr. Crotty

This must be wrong. The original statement must be wrong.

Mr. Haughey

It is not wrong. That is an estimate of the increase. I do not think there were any other points raised in relation to this subhead.

In conclusion, I just want to say that despite Deputy Dillon's strictures and gloomy and slightly sinister suggestions about these two schemes, the Calved Heifer Scheme and the scheme for subsidising the export of carcase meat to the United Kingdom, I think in our present circumstances they are both excellent schemes. They are fulfilling the purposes for which they were devised and are contributing in a very satisfactory way to the long-term development of our cattle and of the meat industry. For that reason, both the original amounts of money voted for them by this House are necessary and desirable and this increase which I am now looking for, when voted by the Dáil, will represent money well spent.

Vote put and agreed to.