I move:
That a supplementary sum not exceeding £8,938,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1970, for the salaries and expenses of the Office of the Minister for Agriculture and Fisheries, 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 added to the original Estimate for 1969-70 represents a total net provision of £66,411,000. This figure shows an increase of £9,587,500 on the final total Estimate for Agriculture, including the Supplementary Estimate, for 1968-69. The sum of £66.4 million includes £36½ million for price support, of which milk accounts for £31 million. It also includes £19 million for agricultural development grant schemes: £3 million for disease eradication; £3 million for agricultural education and advisory services and £2½ million for research.
The additional sum now required includes £4 million for milk; over £1 million for lime and fertiliser subsidies; £1 million for payments to the Pigs and Bacon Commission; £900,000 for the beef cattle incentive scheme; £790,000 for the calved heifer scheme; £525,000 (net) for bovine tuberculosis scheme; £500,000 to meet losses on disposal of wheat; £350,000 for grants for the glasshouse industry; £224,000 for the land project and £177,000 for the farm building scheme. A net saving of £250,000 is expected under the beef, mutton and lamb export guarantee schemes and a further net saving of £331,000 under the brucellosis eradication scheme.
The first item I shall deal with is support for creamery milk—the most costly item. The original Estimate provision was £27 million and a further £4.061 million is included in the Supplementary Estimate, making a total provision of £31.061 million.
The amount provided by the Exchequer for creamery milk support has risen at a very sharp rate in recent years. In the last financial year it was £25.4 million; in 1967-68 it was £19.3 million; in the year before that it was £13.7 million and in 1964-65 it was £8.2 million. Thus, it has almost quadrupled in five years. This shows what the Government have done and are doing for the dairying industry and those who are most vocal in their criticism of every new step taken by the Government to assist the industry should pause to reflect on the vast contribution being made by the Exchequer to the industry's total income. They should note in particular that the Exchequer is paying an average of about 1s 2d on every gallon of milk delivered to creameries in the current year.
Of the total provision of over £31 million, about £17¼ million is required for payment of milk price allowances to suppliers of milk to creameries and just over £3 million is needed to meet the cost of the special quality allowance on all creamery milk that passes the quality test. These two allowances make up a total of over £20¼ million which is payable, through the creameries, direct to the farmers who supply creamery milk. However, this is not the full picture. About £10¾ million more is paid from the Exchequer to Bord Bainne towards the board's export losses, and this large sum is reflected in the prices paid by the board to creameries for butter and to manufacturers for cheese, whole milk powder, chocolate crumb and other dairy products. While the allowances paid direct from my Department to the creameries are shown in the monthly returns to producers, the benefit of the £10¾ million paid through Bord Bainne is not readily apparent. However, it is reflected in the butterfat price received by the producer. The overall position is in fact that about half of the total cash received by creamery producers for their milk now comes from the Exchequer.
As the increasing costs of milk production have been bearing more heavily on the small and medium-scale producers than on the large producers, the Government decided in October last that the Exchequer support for the creamery milk price should be adjusted on a tiered basis. A price increase on their entire production was given to the 80 per cent of producers who supply less than 7,000 gallons per year. Those supplying between 7,000 and 14,000 gallons received an increase on a gradually declining scale. Those supplying between 14,000 and 20,000 gallons neither gained nor lost and only the 2½ per cent of producers supplying more than 20,000 gallons a year had to bear a phased reduction. These latter producers have advantages of scale resulting in lower unit costs. The advantage in production costs of a supplier of, say, 60,000 gallons compared with those of a 7,000 gallon supplier far outweighs the difference in the new rates of support. There are, of course, other considerations also. The relative income position of the larger suppliers is much better than that of the smaller suppliers. The cost of subsidising the larger suppliers has been mounting steadily. All extra milk produced has practically to be given away in export markets; I shall say more about this in a moment. The beef cattle incentive scheme is available to anyone who decides to switch from milk to beef. Furthermore, if the adjustments had not been made, it would not have been possible to increase the price for the small and medium-scale suppliers who constitute the great majority. As I have already stated publicly, I make no apology for giving special consideration to the smaller producers. The principle of channelling a larger share of State support for milk to the traditional supplier is not new. It has long been accepted by farm organisations. It was very much NFA Council policy as long ago as 1962. In that year the then president of that organisation had this to say in his message to readers of the NFA Year Book. I quote:
"We must attach special importance to the decision of Council ....that all future subventions to agriculture wherever practicable must be applied so as to be of maximum benefit to the smaller farms, and must diminish progressively on a sliding scale as the size of the enterprise increases."
Before leaving the subject of the support adjustments I might add that last autumn the Government also gave a retrospective increase of 1d per gallon to all suppliers on the first 1,000 gallons per month supplied in the period May to August.
The total creamery intake in 1969 at 527 million gallons was 7 million gallons above 1968 and was an all-time record. It would have been even higher were it not for the drought conditions experienced in the autumn. Deliveries in 1970, given reasonable weather conditions, may exceed the 550 million gallon target which we set for ourselves in the Second Programme.
The increasing level of milk production and the depressed state of world markets for dairy products are reflected in the cost of the Exchequer contributions towards meeting the export losses of An Bord Bainne. The world market situation for dairy products is little short of chaotic. Huge stocks in the EEC overhang the markets, and the outlook for the immediate future is anything but encouraging. Most of our sales of butter in foreign markets in the current financial year have been made at little more than give-away prices. For example, we have had to sell thousands of tons of butter at less than a shilling per lb. which, when allowance is made for manufacturing and other costs, represents only a few pence per gallon for the butterfat of the milk concerned. In view, however, of the vital position of dairying in our agricultural industry and having regard to the importance of milk production to many thousands of our farmers, the Government continue to provide an increasingly high level of support for creamery milk.
While on the subject of Exchequer support for creamery milk, I should like to refer to the milk which is surplus to the requirements of the liquid trade in the Dublin and Cork Milk Boards' areas. A working surplus is necessary to ensure that consumer milk requirements are fully met throughout the year despite the fluctuations which normally occur in supply and demand. Heretofore, the cost of disposing of this surplus was financed mainly by the Exchequer. However, as the surplus is an integral and essential part of the liquid trade operations I have arranged, as I announced in January, that the disposal of the surplus will in future be financed from funds derived by the Dublin and Cork Milk Boards from a levy on all sales of liquid milk in their respective areas. These new arrangements will have only a negligible effect on the Exchequer bill for creamery milk support in the current financial year but in a full year they should yield a saving to the Exchequer of the order of £300,000. At present these new arrangements are being applied only to the surplus of the liquid trade in Dublin and Cork. The application of a somewhat similar arrangement to the surpluses of the liquid trade in other areas would present certain problems but these are being examined with a view to securing further relief for the Exchequer, if possible.
I should like to refer here also to the need for reorganisation and rationalisation of the creamery industry if it is to meet the keen competition expected to continue in world markets in the years ahead and if our milk producers are to obtain the maximum returns. The question of rationalisation has been receiving serious consideration by many co-operative creamery societies throughout the country and significant progress has already been made. In order to assist further progress, I have approved of negotiations for the transfer of some of the interests of the Dairy Disposal Company to co-operative ownership in the context of overall reorganisation and rationalisation of the creamery structure in the areas concerned. Rationalisation proposals have, of course, to be most carefully examined by creamery societies from the social aspect as well as from the economic aspect. In this connection I have already announced my intention to establish an independent group to evaluate any proposed scheme for creamery rationalisation from both aspects, where it is clear that some of the interests involved have cogent reasons for objecting to the scheme.
The calved heifer scheme terminated on 30th June, 1969. A provision of £200,000 was made for it in the Estimate. However, there was a remarkable surge of interest in the scheme in its final few months. The number of applications received from January to June, 1969 was 26,530 compared with 16,005 in the corresponding period in 1968. No doubt the greatly improved prospects for the cattle trade and the introduction of the beef cattle incentive scheme contributed to this. The result is that the grants this year will amount to about £940,000. Miscellaneous expenses bring the total provision to £990,000.
When the scheme was announced as part of the Second Programme for Economic Expansion, the target set was an increase in our cow numbers from 1,322,000 in 1963 to 1,700,000. In June, 1969, with a cow population of about 1,655,000 we had practically achieved the target and there is potential for a further increase this year.
In my speech on the 1968-69 Estimate I made a preliminary announcement on the introduction of the beef cattle incentive scheme which is aimed at encouraging beef production by providing grants to herdowners registered under the bovine tuberculosis eradication scheme who do not sell milk or milk products. Herdowners selling milk or milk products, who are prepared to switch over entirely to beef production, may, of course, apply to participate in the scheme. A grant of £12 is paid each year under the scheme for each cow, in excess of two, which is present at two consecutive inspections and is matched by a calf.
The scheme met with a ready response in its first year of operation. Around 36,000 herdowners had applied in time to have their herds inspected at the first round of inspections which took place in June. These herds were again inspected in September and payment of grants to eligible herdowners has since taken place.
The sum provided for this scheme in subhead K.29 of the main Estimate was £1,000,000. When that Estimate was drawn up, the grant proposed was £8 per cow. Subsequently, however, following representations from farmers' organisations and committees of agriculture, I increased the grant to £12. A a result of the impetus given to the scheme by the increased rate of grant it is estimated that grants to herdowners for the year 1969-70 will come to close on £1.9 million, the extra £900,000 to be provided for in the Supplementary Estimate. A large proportion of the £1.9 million will go to the small men in the western areas.
I referred at the outset to a saving on meat subsidy payments. This saving reflects the higher level of market prices. In 1969 the cattle trade continued buoyant. Demand for cattle and beef was steady and prices generally were higher than in 1968 which was itself a very good year. Our exports of store cattle to Britain and the Six Counties were at a rather lower level than in 1968. However, in view of the record level of total cattle numbers in 1969, the somewhat lower level of exports was not due to any shortage of supplies. The tightness and cost of credit in Britain seem to have been one of the major causes of the lower British demand for stores. Export slaughterings of bullocks and heifers were well maintained. Following the increase in the British guaranteed price for cattle for 1969-70, the Government decided to increase the level of support for our carcase beef exports to Britain by approximately 2d. per lb. deadweight. Because of the good market price situation in Britain the level of the guarantee payments under the fatstock guarantee scheme there and, consequently, the level of our expenditure on the carcase beef export support payments will be lower in 1969-70 by about £500,000 than was originally estimated. Exchequer expenditure will, nevertheless, be very substantially above what it would have been if the support level had not been increased in March last. Because of the lower level of the British guarantee payments the amount payable by the British Government under the Free Trade Area Agreement on imports of Irish carcase meat up to 25,000 tons will also be down by £250,000.
The carcase beef industry has, of course, been making an important contribution to the national economy for many years. The industry was developed without financial assistance from the State but in 1965 a temporary scheme of support for exports to Britain was introduced to assist the meat exporters who at the time were finding it difficult to obtain adequate supplies of fat cattle. This scheme was put on a more permanent basis in July, 1966, when the Free Trade Area Agreement came into operation. The agreement provided in effect that the British Government would pay us the British guarantee payment on 25,000 tons of Irish beef per annum. The agreement did not specify how this money should be used but it was agreed between the two Governments that it could be applied in continuation of the previously existing beef export support. The Irish Exchequer has, of course, been supporting a far larger quantity of beef than the 25,000 tons per annum supported from the funds provided by the British Government under the Free Trade Area Agreement. In the current financial year, for instance, exports of beef to Britain are likely to be in the region of about 75,000 tons and support for 50,000 tons of this will be provided by the Irish Exchequer.
These support payments have greatly improved the competitive position of the meat factories whose only competitor now is the store cattle exporter whereas previously they had to compete against the shipper of live fat cattle also. It has been suggested in certain quarters that our rate of support should always be the same as the guarantee payment in Britain. However, while British feeders of Irish stores get the full guarantee payment from the British Exchequer and although the greater part of this money may come back to the Irish store cattle producer, some portion of it is retained by the British feeder. The fact that our support here does not match exactly the British level of support has not had an adverse effect on the throughput of the meat factories. Indeed, in the ten months since the beginning of the current fatstock year in April last up to the end of January, the factories slaughtered 35,000 bullocks and heifers more than in the corresponding period of 1968-69 whereas exports of store cattle were at a lower level. In the nine months April to December, 1969, the number of store cattle exported was 67,600 head lower than in the same period in 1968.
It has also been suggested that no cattle should be allowed to be exported alive. This suggestion seems to me to ignore the interests of producers. I cannot see how the best interests of producers would be served by termination of the store cattle trade which earned over £45 million in 1968 and nearly £43 million in 1969. As experience in 1966 and 1967 showed, the existence of competitive outlets is the producer's assurance of the best possible prices for his cattle.
Late in 1968 the US Government introduced allocations arranged on a multilateral voluntary basis for imports of beef into the United States during 1969 from all the substantial supplying countries, including Ireland. Our beef exports to the US which consist almost entirely of frozen cow beef for manufacturing purposes, amounted to about 25,000 tons in 1968. Under the arrangements for 1969 Ireland was originally allocated 28,000 tons but this figure was subsequently increased to 28,800 tons as a result of the redistribution of a shortfall in imports into the US from another supplying country. Similar arrangements will also apply in respect of imports of meat into the US during 1970 and our allocation for the year is 29,240 tons.
The EEC market continues to remain closed for all practical purposes to our cattle and beef. Throughout 1969 levies were in operation continuously and at times reached the equivalent of about £55 per head on top of which there is a duty of 16 per cent, as well as heavy transport and other costs. In this kind of situation it is not surprising that our exports to the EEC have been at a virtual standstill. Efforts to secure some concession from the Community and member States for Irish cattle and beef were continued but without success. We have drawn particular attention to our concern that any concession granted to a third country should be extended to us and we have not hesitated to press our case strongly in the Community and with member States.
Coras Beostoic agus Feola, which was established by me at the beginning of 1969 to promote exports of cattle, sheep and lambs and meat, has been active in promoting exports. The commission is now getting into its stride and I look forward to its achieving impressive results to the advantage of both producers and exporters.
Despite incentives to increased production of sheep and lambs and despite the relatively good prices during recent years, sheep numbers have continued to decline. To a great extent this decline reflects the relative profitability of competing agricultural enterprises and it is significant that the decline seems to have occurred mainly in the lowlands. Exports of carcase lamb to the Continent exceeded exports to Britain for the first time during 1968 and this was the position also in 1969.
The mountain lamb subsidy scheme was continued in 1969 and again proved very successful. In the current financial year approximately £424,000 has been paid in subsidy at the rate of £1 per lamb to mountain sheep farmers. As Deputies are already aware, the same rate of subsidy was extended in 1969 to hogget ewes and payments amount to about £171,000 bringing total subsidy payments to about £595,000. Miscellaneous expenses connected with the schemes bring the total outlay to £600,000 in round figures.
As a means of stimulating production the extension of the subsidy to hogget ewes should have effects reaching beyond the mountain areas. It should lead to younger more productive ewes being retained in mountain flocks and the older less productive ewes being removed to the lowlands where they can be profitably used for further breeding.
I might mention here a development of interest to pony breeders—the holding by the Connemara Pony Breeders' Society of an international conference in Galway next August. This is the first venture of its kind. It will bring Connemara Pony Societies from all countries together and I am providing in the Supplementary Estimate for a grant of £1,000 towards the cost of the conference.
The total provision for pigmeat support in the current financial year is £3.6 million, as compared with actual expenditure of £2.95 million in 1968-69.
The year 1969 was a good one for pig producers. Deliveries of pigs to bacon factories reached a new record level of 1,936,000 exceeding the previous record in 1965 by 139,000. Prices for both weaners and finished pigs were buoyant throughout the year.
When it was announced in November, 1968, that the floor price for barley of the 1969 crop would be increased by 3/- per barrel, it was indicated that an appropriate adjustment would be made in the guaranteed minimum prices for pigs in the autumn of 1969. This was done. We also made some necessary grading changes, reducing the maximum weight for all grades and amalgamating two of the medium grades. The reduction in the maximum weight of the export grades from 160 lb deadweight to 150 lb was necessary so as to bring the weight of Irish bacon sides into line with our competitors' bacon on the British market. We had also in mind the desirability of lessening any incentive to smuggle pigs from the Six Counties where the maximum weight for good quality pigs for some time past has been 145 lbs.
As Deputies are aware, a multilateral understanding governs the supply of bacon to the British market. Our quota for the 1970-71 quota year is 28,180 tons, the same as for 1969-70. With record pig slaughterings we were able to find export markets for substantial quantities of pork in the past year and the Pigs and Bacon Commission sent substantial supplies not only to the traditional British out-let, where the bulk of Irish pork is sold and where it commands a premium price, but to Italy, Hungary, Canada, Switzerland, Norway and Japan. In many of those markets the returns were appreciably better than those for pork and bacon exports to Britain. However, while we welcome these marketing de-developments, it should not be assumed that we have unlimited and remunerative outlets abroad for our pigmeat production. The fact is that there was a lower level of pig production on the Continent during the past year, apparently as part of the normal evolution of a pig cycle. Production in many of the Continental countries is now increasing but I feel confident that the Pigs and Bacon Commission will be able to retain its footing in some of its new markets, particularly as Irish pork has met with ready acceptance as a high quality product in those markets.
While testing under the bovine tuberculosis eradication scheme continues on much the same pattern as in previous years, my Department has been making a big effort to stamp out the remaining sources of the disease. This, it is hoped, will lead to a substantial reduction in incidence in future years. In the current financial year the provision in the main Estimate will be exceeded, due mainly to an increase in the number and cost of reactor animals to be purchased. The Supplementary Estimate includes provision for the extra expenditure.
As Deputies are aware, County Donegal was declared a brucellosis-free area in June, 1968. Four more counties, namely, Cavan, Leitrim, Monaghan and Sligo have now been added to the brucellosis-free area. The further extension of the eradication scheme is at present under examination. The Supplementary Estimate takes account of an expected net saving of over £300,000.
It had been anticipated that the incidence of warble infestation in 1969 would have been at much the same level as in 1968 when approximately 160,000 cattle were treated. In the event, the number treated was about 400,000. The increase in incidence can be attributed to the fact that in 1968 the dressing campaign got off to a late start because of the foot and mouth precautions in the early part of that year. As a result warbles had emerged in large numbers before the affected animals could be treated. It is to be hoped that the extensive dressing coverage provided in 1969 will have reduced warble infestation to an insignificant level again but this will not be known until later in the spring. Should it transpire that pockets of infestation remain these will have to get special attention. I would stress, however, that the fullest co-operation of all herdowners is needed if our efforts to eradicate this injurious pest are to succeed.
As the House is aware, there was a large surplus of wheat over the milling requirement from the 1968 harvest. This surplus had to be disposed of as animal feed and the Exchequer had to bear the cost as no wheat levy operated in that year. In addition to a sum of £900,000 which was paid in 1968-69 to An Bord Gráin to meet part of the loss involved, there is a provision of £500,000 in the Supplementary Estimate to meet a further part of the loss involved. Indeed this may not be the end of the Exchequer commitment for the 1968 crop. These payments are, in fact, a bonus to wheat growers, because under normal circumstances they should have carried the loss themselves by way of a levy deducted from the price of wheat in 1968.
Demand for the facilities provided under the Department's various development schemes continues at a high level.
The amount paid out in 1968-69 by way of grants to farmers under the land project general scheme was £2,610,000 and the area of land improved was 97,000 acres.
Grants available under the schemes for mountain fencing and grazings have been considerably improved and constitute a strong inducement to farmers to produce more and better "keep" for stocks in mountain areas during critical periods of the year.
The fine summer and late autumn of 1969 resulted in an exceptionally large number of land project works being completed. The number of cases submitted for grant payment in the nine-month period from 1st April to 31st December rose from 12,163 in 1968 to 13,792 in 1969, representing an increase in acreage reclaimed from 85,282 acres to 98,134 acres and a consequential increase in grant payments from £2,103,000 to £2,513,000 in the respective nine-month periods. The amount provided for grant payments in the 1969-70 Vote is £2,530,000 but it is clear that this will be insufficient. Provision is being made under subhead K.9 in the Supplementary Estimate for a further £224,000.
The farm buildings and water supply schemes are kept under review to ensure that the facilities provided are in line with the current needs of farmers. In February, 1969, grants for unroofed silos were reintroduced. In May, new grants were introduced for cow parlours, while increased rates of grants became payable in the case of dry stock housing, silos, silage bases and water supplies.
The sum provided in subhead K.8 of the main Estimate for grant expenditure under these schemes was £2,593 million. The increased grants will give rise to extra expenditure estimated at £117,000. Provision for this is being made in the Supplementary Estimate. In 1968-69 grants paid under these schemes amounted to £2,457 million.
Silage making is of tremendous importance in our animal production economy. The tonnage made increased from about 400,000 tons in 1963 to 2,400,000 tons in 1968. A further significant increase to over 3 million tons is estimated to have taken place in 1969. Grants for the purchase of new forage harvesters—equivalent to about one-third of the purchase price—are being continued. Grants are paid at a flat rate to suitable persons who undertake to hire out the equipment on specified terms and to groups of farmers prepared to co-operate in silage making.
The scheme is being operated through the committees of agriculture to whom the Department recoup the full amount of the grants paid. In view of the popularity of the scheme, I am making provision in the Supplementary Estimate for an additional £40,000. To enable instructors in agriculture to give on-the-spot recommendations to farmers on the feeding value of their silage, in-service practical courses on the analysis of silage have been given in the various counties.
In 1968-69, there was a slight decline in deliveries of ground limestone due, in the main, to the adverse weather conditions in the early months of 1969, when the demand should have been reaching its peak. Any decline in consumption would be unwelcome and I am glad to say that there has been an increase this season. I would again urge farmers to order as much lime as possible during the summer months when they are assured of prompt deliveries and can take advantage of the lower prices generally prevailing at that time.
The promotional measures in favour of fertiliser use initiated by my Department a few years ago in co-operation with the fertiliser industry and the advisory services have proved very successful. Consumption of the three main nutrients, nitrogen, phosphorus and potassium, has increased remarkably over the last three years. The provision in the main Estimate for lime and fertiliser subsidies was £6,037,000 but, in view of the increased consumption, it is necessary to seek a supplementary sum of £1,022,000 making a total of £7,059,000.
The scheme of grants for glasshouse nurseries was introduced in 1967 to encourage the modernisation and expansion of existing commercial nurseries and the establishment of efficient new ones. Progress under the scheme has been rapid and 130 acres of modern, fully equipped glasshouses have already been approved for grants. Growers have expanded their share of the home market for tomatoes and exports have increased from £180,000 in 1967 to about £430,000 in 1969.
The response to the scheme and its cost to the Exchequer have been much greater than had originally been expected and provided for. During the current financial year it became necessary, because of the very large number of applications on hands, to review the position generally from the financial aspect and, in the meantime, to suspend the further approval of applications. The amount in the main Estimate is not, in fact, sufficient to meet payments in many cases already approved before the review.
The approval of applications under the scheme has now been resumed. The scheme has now been modified by the introduction of a ceiling of £25,000 on the grant available to any new applicant. In cases where applications were already on hands awaiting approval while the scheme was under review, a maximum grant of £40,000 will be allowed. A suitable system of priorities for applications within the funds available is also being worked out in the case of future applications. The supplementary provision of £350,000 now proposed will enable most, if not all, the cases maturing for payment before the end of the financial year to be dealt with.
The establishment of a development council for the glasshouse industry was recommended in the report of the survey team on that industry. Consideration is being given by the industry and by my Department to the question of how a council or development body for the industry could best be established and financed.
A sum of £1,750,000 was provided under subhead I.5 of the main Estimate towards the non-capital expenses of An Foras Talúntais. A further £96,000 will be required to meet the cost in the present year of applying national salary and wage increases to staffs of the institute. Provision for this is being made in the Supplementary Estimate. Under subhead I.6, £70,000 is being provided to finance capital expenditure by the institute. The State's financial contribution to the institute in the current financial year will, thus, amount to something over £1,900,000. This compares with a contribution of £1,582,500 in the past financial year.
Almost 70 per cent of the institute's current outlay is accounted for by salaries, wages and travelling expenses of the staff, and a substantial part of its increasing annual expenditure arises under this head. It may be noted too that as the institute's expenditure increases so does its dependence on the State for funds to meet this expenditure. In the present financial year, it is estimated that at least 80 per cent of the institute's current expenditure, as well as the whole of its capital expenditure, will have to be met by the State.
While there is expected to be a saving on grants under the small farm incentive bonus scheme, this is not indicative of a lack of interest in the scheme. In fact, since its introduction in May, 1968, over 9,000 farmers have applied to participate in the scheme and over 6,000 of these have embarked on their farm development plans. Many of the participants have, indeed, already successfully completed stage one of their plans and have been paid the first instalment of £50 of the bonus grant.
A notable feature of the scheme is the fact that almost two-thirds of the participants are in the 12 western counties. This represents a very satisfactory initial response to the scheme in the areas where the need to intensify employment, both on and off the farm, is greatest.
The administration of this scheme is very largely in the hands of the chief agricultural officers and their advisory staffs throughout the country and I would like to express my appreciation of their efforts in getting the scheme under way and to thank them for their co-operation in the operation of the scheme at all times.
As announced in the 1969 Budget statement, the total bonus grant offered under the scheme has been increased from £200 to £300. This bonus grant is additional to all other grants and subsidies available to farmers and it should offer a very strong incentive to smaller farmers who come into the potentially viable category to take part in the scheme. It is hoped, therefore, that many more farmers will be applying to participate in the scheme from now on.
There appears to be a certain amount of misconception about the Government's policy on small farms though this policy has been set out clearly in successive economic programmes. The role of the part-time farmer has been fully recognised. Part-time farming has long been a feature of our whole agricultural economy and particularly of the western areas. On this point I need only refer Deputies to paragraph 18 of Chapter 5 of the Third Programme from which I quote the following:
Even with this special scheme— that is the Small Farm Incentive Bonus Scheme—and the wide range of other measures available to help farmers, there will inevitably remain a proportion of farms which cannot be brought up to a viable level. On many of these the occupiers can provide themselves with a reasonable level of income through supplementary earnings from non-agricultural sources. The opportunities for securing such earnings already exist in many instances and the aim is to expand them still further. In the long run the only real solution to the problem of farms which cannot be made to provide a reasonable livelihood lies not in agriculture alone but in the comprehensive development of rural areas through the expansion of industry, tourism, afforestation, fisheries, etc. This approach has the advantage of helping to maintain the rural population.
Since we are dealing with the Supplementary Estimate only, my statement has not covered broad aspects of agricultural policy and developments. I would have welcomed an opportunity of giving the House a general outline of our assessment of what membership of the EEC will mean for Irish agriculture. I may briefly say, however, that the main benefit for the farmer would be increased prices, especially for cattle and milk, higher output and income. Our agricultural exports would have free access to a large market at remunerative prices but would encounter keen competition from other member States. I hope to publish in the very near future a document setting out in detail the results of a study on Irish agriculture and fisheries in the EEC.
I would like also to comment briefly on criticism of the Free Trade Area Agreement made by the chief spokesman on agriculture for the British Conservative Party, and on complaints by the chairman of the Milk Marketing Board for England and Wales about the growth in imports of some Irish dairy products. The Free Trade Area Agreement means a two-way traffic between Britain and Ireland. Special treatment for our agricultural exports to Britain is our right under the agreement and we are paying for it by way of concessions on imports of British industrial goods into Ireland. Our ability to continue as a substantial importer of British goods is largely dependent on the development of our agricultural exports to the UK. Unfortunately the persons in Britain to whom I have referred do not appear to see matters this way. What they seem to be advocating is a situation in which British industrial goods would have free access to our market while the entry of Irish dairy and other agricultural products into the British market was restricted by governmental or other action. We could not, of course, accept such a situation.
Finally, I would mention that, thanks to sound policies, agriculture has now had three consecutive good years marked by substantial increases in agricultural output, prices and incomes. Government policy, as is has evolved over the years, has resulted in farmers being increasingly well equipped to expand production on an efficient basis and to exploit opportunities for increased sales.
