With your permission, a Cheann Comhairle, I propose to take Questions Nos. 26, 27 and 28 together.
I commented in a public statement on 21st October on some criticisms of the creamery milk price adjustments I announced on 3rd October which obscured the main facts of the situation. The facts are that:
(1) Every creamery milk supplier in the country will, within the coming weeks, get a back payment of an additional penny per gallon on the first 1,000 gallons delivered in each of the months of May, June, July and August this year.
(2) Suppliers of not more than 7,000 gallons per annum will also get with effect from 1st September last an additional penny per gallon. Some 90,000 of the total of 112,000 creamery-milk suppliers deliver not more than 7,000 gallons each per annum and all of these will get the additional penny on their entire deliveries.
(3) A further 15,000 suppliers who deliver between 7,000 and 14,000 gallons yearly will get an increase gradually declining from 1d and phased out at the 14,000 gallon mark.
(4) Some 4,500 suppliers who deliver between 14,000 and 20,000 gallons yearly will bear no reduction.
(5) The remaining 2,500 suppliers (only 2 per cent of the total) whose yearly deliveries exceed 20,000 gallons each will bear a phased reduction in price support according to the size of their deliveries.
(6) The vast majority of creamery suppliers are accordingly getting a price increase at a time when increased production has to be sold on export markets at less than 1/- per lb for butter, which represents only 2d or 3d a gallon at the creamery.
(7) Creamery milk price support will cost the Exchequer at least £31 million this year, as compared with some £25 million last year and £19 million in 1967-68.
The large-scale suppliers of milk to creameries can, of course, produce milk at lower unit costs than those of the smaller suppliers, and the need for Exchequer support in their case is accordingly lower. However, these large-scale suppliers will continue to benefit significantly from the Exchequer support. For example, a supplier of 60,000 gallons per annum will still receive about 10d per gallon subsidy from State funds, which represents a total of £2,500 a year or an average subsidy of almost £50 per week.
I do not accept the implication in Deputy Creed's question that the smaller producers are inefficient and unable to produce quality milk. No change whatever has been made in the quality bonus of 2d per gallon, and all milk delivered to creameriees, whether by large-scale producers or small, is capable of being brought to the desired quality standard.
The support adjustments which I have announced do not in any way represent a change of Government policy for creamery milk production. They were in fact foreshadowed in the Third Programme which indicated that consideration would be given to the possibility of extending the phased system of price support for milk so as to channel a larger share of State support to the traditional supplier who is less well able to meet increasing costs than the large-scale commercial producer.