When the debate was adjourned, I was dealing with the question of national sovereignty. It was a problem to which other speakers had adverted and some of them were rather perturbed at the necessary abatement of our national sovereignty which would arise if we entered the EEC. At the same time, I dealt with the type of national sovereignty we had and I traced chronologically the events which led up to the establishment of our 26 County administration pointing out, in passing, that in 1922 the British Parliament passed the Ireland Act which provided for two national Parliaments here and that was in direct contradiction of the spirit of the 1914 Home Rule Bill which was passed in the House of Commons and set aside on the same day by a Deferment Bill.
I also mentioned that following the 1920 Act the Stormont Parliament was opened by King George V in the summer of 1921. Following his speech on that occasion the Truce was declared and negotiations began in October and the Treaty was signed in 1921 providing for the right of the Northern Parliament under section 12 to opt out within 12 months. This right they subsequently exercised a year later when the Treaty was ratified by the Irish people. They exercised their option to get out within two days and apparently they have not changed their minds very much vis-à-vis the Administration here since then.
We had a protected economy as regards trade, particularly in the earlier years of the State. All during the war there was a sellers' market and it is only in recent times the crunch is being felt by our exporters. That is becoming apparent now in a disimproving trading position. Exports to Britain, for instance, have begun to fall from being three-quarters to about two-thirds and our imports from the same country have increased. This has placed us in an increasingly difficult position, because it is necessary to try to balance our trade figures by invisible exports.
Britain is in the same position as we are, having a traditional trading balance, but Britain, as the centre of the sterling area, has a big money market, is still a world power and has been a great empire. It will be readily understood that Britain in the sphere of invisible exports would be in a different position from a country like this. We have so far been unable to have anything like a money market, and our stock exchange is nothing more than a provincial stock exchange in any big town in Britain.
All told, therefore, we must be careful as regards our exports. There used to be a notion here that if the imbalance became any more than £100 million, we were moving into deep water. Of course, that is a relative figure and must be correlated with both imports and exports. However, it is a serious position. In 1967 our trade imbalance was something over £100 million, in 1968 over £150 million and in 1969 over £200 million—in other words, a figure which has doubled in a couple of years is getting into the realms of being very serious.
There are other disquesting features, too. As regards the British market there has never been the possibility of equal competition. Our farming community have been compelled since the foundation of the State to export their agricultural produce into what is virtually a world food dump. The price they got was regulated by world prices and how cheaply Britain could buy from anywhere else. At the same time, Britain pursued a policy of producing cheap food for her people and subsidising her own farmers. That enabled her to be a powerful nation industrially. By being able to provide cheap food she was more competitive in the industrial sphere. She imported about half her food from the four corners of the earth. Ireland had to complete with that and it has always been a difficult problem for the Irish farmer. It was a market over which we never had and never will have any control.
The Common Market provides us with an opportunity; some would call it a challenge; perhaps one could also call it Hobson's choice. I do not think we have much opportunity of remaining outside the world of free trade as a small, protected island. Other countries tried that back in the 30s. In Britain, which has an economy completely different from ours, there was a movement in this direction, and the late Lord Beaverbrook spent half his life campaigning for what he called splendid isolation on the part of Britain. He used the entire resources of his chain of newspapers to propagate the idea, but Britain never accepted the notion of splendid isolation. If Britain could not do it I do not know how we could do it. Possibly we could live at a very low subsistence level by putting a wall around the country and cutting ourselves off from everyone else. We would put ourselves completely outside the stream of civilisation and our standard of living would become extremely low. We would not starve but the other amenities of life would be sadly missing if we tried to remain outside the European trading bloc.
If we enter the Common Market it will be the first occasion on which we shall be able to export on equal terms to a population of 250 million people. We have never enjoyed that before. We got some concessions—and they were always regarded as concessions—from Britain. Following the Dillon agreement, the price of our cattle was tied to the price of cattle in Britain, and that kept our store trade alive. The fact that this country was free of foot-and-mouth disease also helped.
Some of our agricultural products will benefit greatly in the Common Market. This is a country with a temperate climate, pretty good grass, moderate, perhaps, sometimes more than moderate, rainfall, and it is possible to winter our cattle more cheaply than in Scandinavian countries like Denmark. Ireland has that advantage. The health of our cattle has always been very good and the country has always been free of foot-and-mouth disease. We have virtually eradicated TB and brucellosis is being tackled. We have made a mess of the warble fly business but further efforts will be made again now. By and large, therefore, from the point of view of cattle health, we are in a pretty good position as a result of the work done and the considerable expenditure incurred down through the years. Our transport circumstances may not be as good as they are in other countries. This country has not the same access to the Common Market countries as the smaller European countries would have, but it is generally accepted that even after entry most of our exports will still be to Great Britain.
One of the difficulties here particularly in recent years has been the question of dairy products. It may be, indeed, that we have not been very businesslike in the past in that respect. Bord Bainne, however, have done an excellent job. We are fighting a world glut in regard to butter because storage of butter on the Continent amounts to 100 million tons, which is a serious obstacle. In our own community over the past decade our creamery intake has doubled to 500 million gallons and our dairy products have quadrupled. In addition we have a cow population now of 1.6 million. Shortly we will be in the position that we will be utilising 200 million gallons for home consumption and 300 million gallons for export. Our problem is to find an export market for that amount. We had a basic butter quota in 1965 of 23,000 tons which was raised subsequently to 26,000 tons. At one time the quota was only 18,000 tons. At present Irish butter, particularly the "Kerrygold" brand, is very well received on the British market and we could sell much more if we could get a higher quota. The United Kingdom stocks are falling. Irish Cheddar cheese has achieved quite a good reputation in Britain and is now commanding better prices than either the Australian or New Zealand product. This is a position we thought we could never achieve a few years ago and much credit must go to Bord Bainne for it.
On the other hand, we must recognise that we are exporting a lot of our products at give-away prices. At the moment we are exporting butter to 50 different countries and while we may be exporting it to the British market, which is one of the best markets, at 3s a lb we are selling it at a loss to places like Algiers and Morocco at 9d a lb. One asks oneself if there is any possibility of improving that position in the Common Market. Our butter quota has been advanced for 1970-71 to 30,000 tons and our quota for Cheddar cheese is 17,500 tons. Here again we could sell more except for the fact that a gentleman's agreement has been sought and we have been asked to impose a voluntary restraint on our cheese exports. The quota system, of course, and this voluntary restraint, would disappear under EEC arrangements because all quota systems would go.
One also hopes, and indeed the general prognostications are, that the price of butter will improve on our entry into the Common Market. Ireland, of course, unlike the present position, would be open to imports from any other member country. Indeed, if countries such as Denmark wanted to send in butter here they could do it under EEC conditions, whereas they cannot do so at present. The price of oats to farmers and particularly for the production of dairy products makes quite a demand on our economy. In so far as exports go, about two-thirds of the money comes from Government sources and about one-third is levied on the farmers. This whole question is tied up not alone with development and production trends in the future but also with the negotiating position which will obtain when Britain goes into the Common Market, as I presume she will.
Britain imports a considerable amount of agricultural produce from the Commonwealth. For instance, Australia and New Zealand export 250,000 tons of butter to the United Kingdom where the total consumption is 450,000 tons. That, compared with our miserable 30,000 tons, is a massive figure. It becomes incomprehensible when one considers that there is not that great difference in visible trade. Our purchases of food stuffs from Britain exceed those of New Zealand from Britain. Such is the state of affairs that New Zealand and Australia have that large share of the British market and our share, is comparatively small. We should have a much larger share of the British butter market if the position were to be fairer, if it was a question of give and take based on the value of our imports from Britain.
The advance in the position of Irish cheese in Britain and its improved reputation largely derives from a grading system introduced by Bord Bainne. Deputies will recall that some years ago when we were exporting butter from perhaps 150 different sources, when each creamery did its own exporting, the butter got as far as the quayside at Birkenhead where it was dumped and goodness knows what it was sold for. It was a very unsophisticated approach to marketing. It is amazing that only in the past six years have we moved towards standardised production and tried to maintain a standard. We hear a lot about the Mansholt Plan but if we are competitive, despite the glut of dairy products on the world market, there is still room for the good product. I have visited many milking sheds and have found an amazing difference between one farmer's shed and another. In one farmer's shed you will find a few cows being milked by hand, under quite unhygienic conditions, while in another, as was the case in one which I visited recently, you will find self-washing, self-sterilising milking machines from which the milk is taken straight to refrigeration conditions and untouched by hand. The outfit cost £1,000.
It seems to me that that is an indication of the future. We may argue about whether the Mansholt Plan is socially desirable or not, but the inevitable trend of events would seem to show that if we are to produce high-quality milk—and milk is a necessary biological product of our cattle trade— we will have to have farming units of sufficient size to make that type of equipment a worthwhile investment. This trend has manifested itself as a normal evolutionary process in the USA and in Great Britain where approximately five per cent of the population are producing all the food necessary for those countries. According to the views of those who have studied this matter, there would appear to be self-sufficiency of dairy products in the EEC countries over the next decade, but the advent of the four new applicants may alter the position.
The behaviour of the EEC countries is important. At present they are attempting to reduce the production of milk by their cow slaughter scheme and other measures, and they are attempting to reduce the amount of land being farmed. I do not know what the position will be as regards the negotiations which Britain will undertake in the Commonwealth vis-à-vis New Zealand and Australia. It is important from our point of view to know whether Britain will insist dogmatically on New Zealand and Australia being treated as if they were members of the EEC. France did that with regard to her African colonies and the sugar imports. Britain may insist on similar arrangements or may settle for a phasing-out process. I doubt if Britain will just drop the imports from her colonies overnight. There may be a transitional phase. There may be some hard bargaining. Britain naturally will be expected to try to defend her position as a big importer of Australian and New Zealand agricultural produce, particularly butter and lamb.
The problem is one which only the future will unfold. The position will become clear only over the next few years as negotiations proceed. Deputy O'Donovan maintained here that Britain would not go into the Common Britain's third attempt to enter the Common Market. Britain's negotiaMarket on this occasion. This is Britain exceed those of New Zealand question of a common agricultural policy. Britain wanted to preserve her traditional position of providing cheap food for her people in order to strengthen her industrial arm. If Britain could feed the people cheaper she would have to pay them less. Britain did not want to meet the higher cost of agricultural produce which obtained in the Common Market. Since that time the position has altered. Exports have moved away very drastically from the sterling area. There is much export trade with European countries. That trend in trade is not lost on the British who have always been a nation of shopkeepers. I do not know what the Australian trade figures are but in recent years people have said that Australian trade has veered towards Japan and other Asiatic countries. This is something which one might expect. In so far as Japan is concerned, we have attempted to get a toe-hold in the cheese market. It would be excellent if we could do so. There are various by-products of milk which are on a very competitive market. I am interested in a chocolate crumb factory which is situated outside Carrick-on-Suir. Chocolate crumb is sold in a competitive market. That factory has a considerable amount of equity in the hands of a British combine. That helps, because the combine have a large world market and are in a position to secure sale of the product. If the factory was not so structured financially it might not be easy to obtain such markets for the product. While the outlook at the present time as regards dairy products is a bit gloomy, I feel that if we are absolutely insistent on producing a high-class product, in the long term the outlook will be good.
The general impression as regards beef is that the outlook for the production of beef is good and that we have an expanding market which we could profitably harness. We have many advantages. Our cattle population is relatively free from disease and is much better than that of other countries. We have good natural feeding for the cattle and the necessary type of rainfall to give us the grass to produce cattle at a reasonable price. Perhaps some intensive methods of cattle production may evolve but on the whole the opportunities for the beef trade should be good. The pattern of our exports may alter: the store trade, as we know it, may give way to carcase meat and boneless meat, particularly in view of modern forms of transport which are more tailored to the export of dead meat than to the export of live cattle.
In 1968 we exported cattle to the value of £47 million and revenue from beef was £38.5 million. It appears our store cattle trade is declining but I do not know if alternative markets are available on the Continent. We have about 5,500,000 cattle in this country and it is probable that, given an attractive market, we could double that number. I have heard it contended frequently that we are merely scratching the surface of agricultural production here and if we were given a proper pricing arrangement and sufficient incentives we could develop it much more extensively.
As the continental market now operates, it is very precarious from our point of view. We have not exported any beef to the Continent since 1961 and if we try to get into that market it does not matter what price we quote because an adjustable levy is raised against us which effectively prevents our entering the market. It is only in cases where there is a special demand that we have been able to secure any worthwhile sale of cattle. In view of our declining trade with Britain it is imperative that we seek markets elsewhere.
Politicians have always said to whatever Government were in power that we should seek such alternative markets. The first Government tried to do so but could not. When Fianna Fáil came into power they were convinced that they would get those alternative markets but they encountered the same difficulties. The hard facts of trade were there and no Government have succeeded in securing such markets except at give-away prices. We have been forced to acknowledge during the years that Britain has remained our greatest market and, while it may be an unsatisfactory one, nevertheless it is still a market for our agricultural produce. We have been unable to sell beef on the continental market and the same position will probably obtain in the future for as long as we remain outside the Common Market. This is an opportunity we should not lightly set aside and here is one area in which we can, and will be, pre-eminent.
Apart from securing an increased market for our beef exports, we will be able to obtain higher prices. Any forecast about prices is a hazardous exercise as many imponderables come into operation. Some people say we will probably get a 50 per cent higher price for beef in the Common Market than we would obtain at the present time. Such a percentage would be a tremendous improvement and whether we export it to the EEC countries or to Britain is immaterial as the British consumer will have to pay an increased price for food.
In this country our processing plants for agricultural produce are reasonably good. The purchase by the Cork Marts of a large processing plant and their recent purchase of the Swift Distribution Group have set the cattle trade on the right lines and this will be of great benefit to our farmers. In 1968 we exported more than one million cattle, comprising 315,000 carcase beef, 592,000 stores, the balance being frozen beef.
It is impossible to say with any degree of finality how this form of export will phase-out during the years ahead but it is probable that the store cattle trade will decline sharply. This is a traditional kind of trade and will probably resist being wiped out in a short period, but if consumer tastes change to boneless meat and if transport conditions make it more difficult to export cattle there may be a move-away from the store cattle trade. One of the great attractions of this trade from the British point of view is that we are free of foot and mouth disease whereas continental trading does not have that advantage.
Therefore, the future of our cattle trade lies as it always did in Britain, to an increasing extent in Europe and perhaps in the United States, but I do not think it lies in the underdeveloped countries. Again, the position here is one of economics. The underdeveloped countries are not able to pay for protein foods and, in particular, such expensive protein food as high-grade beef. I cannot see much future for agriculture and, in particular, for the cattle trade in any of these underdeveloped countries.
Of course, as far as our agriculture is concerned, the trend of the past few years will continue. Not very long ago 35 per cent of our people were engaged in agriculture but the figure has now fallen to about 29 per cent. However, if we join the Common Market we shall be the country with the largest percentage of people engaged in agriculture of any of the ten. Italy would be the next highest with 25 per cent. At any rate, almost one-third of our people are still engaged in agriculture.
Certain changes are taking place within the Common Market in the sphere of agriculture. I have already mentioned the Mansholt Plan. These changes have happened as a result of steady evolution in other countries, particularly Britain and America. Mansholt suggested that by a planned or a phased system, the 10 million farmers in the EEC countries should be reduced to five million by 1980. Immediately, the social implications and social difficulties of such a plan come to mind. One can imagine how unwelcome a politician would be if he were to stand on a public platform and say that half the farmers in this country should be put off the land. That was Mansholt's original idea. The plan has been considerably watered down since then but it is still regarded basically as something that should be aimed at. Further to that development, it is proposed that some land be put out of agricultural production and used as tourist countryside or for afforestation. Such a suggestion seems almost sacriligious to us who have been talking down through the years about the millions of acres of land which Mr. Dillon, while he was Minister for Agriculture, brought back into production by his reclamation schemes and projects.
Another scheme that may seem strange to an Irishman is the cow-slaughter scheme recently introduced on the Continent. We have had some experience of this sort of scheme ourselves in that we had a calf-slaughter scheme here but this was under different circumstances.
The cow-slaughter scheme that has been introduced on the Continent is intended to reduce the cow population. This has been found necessary because of a glut of milk and butter in continental countries. In those countries there is movement towards the evolution of production units. Mansholt has spoken about the larger units being economically more viable. Basically, one cannot say anything against the Mansholt ideas or against any other ideas of that kind. The only objection that a public representative or a politician might have to these ideas is the social one. Because of traditional social obligations, none of us would wish to put people off the land. Schemes on a very elaborate scale have been put into operation on the Continent for the retraining and rehabilitation of persons who are put off the land. We have something less elaborate but on the same lines in that the Land Commission are empowered to make pension arrangements for those who give up land and who wish to retire. This is a matter which we must take into consideration in relation to our circumstances if we join the Common Market.
I would like to say a few words about our exports of sheep and in this regard I may be entitled to be a little critical. In so far as sheep and mutton exports are concerned there is a potential rather than an established market. Mutton is not consumed to any great extent on the Continent. In Germany, it is likely that schweinefleisch will be served on most occasions one sits down to eat. One will not get mutton. The French consume a little more mutton than the Germans or Italians but still much less than is consumed in these islands. If we are to develop a market for mutton it will be necessary to do a great deal of advertising but this would be worthwhile as there is tremendous potential. Continental farmers do not breed sheep. We have had a small trade with France at different times but it has been sporadic. There is tremendous potential here by virtue of the fact that this is a type of activity in which continentals have not indulged. Unfortunately, we have neglected the sheep industry. Our sheep population has fallen from 5,000,000 in 1965 to 4,000,000 now. According to one of the programmes on economic expansion it was estimated that we would have 8,000,000 or 9,000,000 sheep by now. We have given nothing like the attention to sheep that we have to beef and to horses. The sheep population in Germany is something like 9,000,000 head. It would be worthwhile to do some research into sheep breeding with a view to producing a better product.
There is one small question mark. We have a modest subsidy scheme for mountain sheep. I do not know if subsidisation would be permissible in the Common Market but, from the point of view of regional development, there is provision which would entitle us to subsidise the industry; on a regional basis since it could be argued that this is an industry peculiarly suitable to development along the western sea-board. There is a potential market and the industry could be developed with a little bit of imagination and drive. It might prove a better money spinner than beef.
Some people are nervous about the Common Market. I think they are frightened largely because of what happened under the Anglo-Irish Free Trade Area Agreement. That agreement has not worked to our satisfaction. Britain took unilateral action when it suited her. She was quite prepared to make difficulties not alone for our exports but also in relation to British investment here. The Common Market concept is totally different from that of the Anglo-Irish Free Trade Area Agreement. There is a common customs barrier. In the case of the agreement each country had its own customs barrier, be it green or red. There was supposed to be liberalisation of trading between the two countries but the liberalisation did not work in our favour.
Agriculture is protected here but we have always been free to export industrial products to Britain, with the exception of manmade fibres. Britain has not been free to send in agricultural produce here. Before ever the Anglo-Irish Free Trade Area Agreement evolved we had been reducing our customs barriers. I think by 1st July this year they were down to 16 per cent. From now on the pressure will be really felt. That is why I have adverted to the position of our exports and the large trade gap.
The Common Market envisages the free movement of men, money and materials. As between ourselves and Britain, there is free movement of men and money but there is no such free movement of material. The Anglo-Irish Free Trade Area Agreement is terminable. The Common Market concept is not terminable. The approach is politically orientated. The ultimate object is to form a political union, whereas no political overtones were associated with the Anglo-Irish Free Trade Area Agreement. We have been somewhat shaken in our confidence by steps that have been taken against us under the latter but, as I have said, the concepts are fundamentally different.
We export sugar. The sugar industry is more complicated than other industries. I do not know what the outcome may be but the industry is important to us because large numbers are employed in our sugar factories and a great many farmers are engaged in the production of beet. For them it is a cash crop. The average small farmer is dependent to a great extent on the creamery cheque coming in the May or June. He has a few good months during the year. In the autumn he sells off his yearlings or any dry stock he has. There is very little to be got from those farms in the winter. Many of them are unsuitable for the production of wheat and even some of them are not good for the production of barley. Beet has been a cash crop and a source of ready money for a number of farmers so that the position of the sugar industry is, to my mind, a bit dubious. I say that because France has already insisted on and secured that her colonies, who are producers of sugar-cane, be treated as members of the Common Market. Britain, if she insists, could obtain similar consideration for the Commonwealth countries from where she traditionally imports her raw sugar. If during the negotiations she insists upon getting similar consideration to that given to France it will create a difficulty for our sugar industry.
This matter requires comprehensive study. I do not know what attention has been given to it. Doubtless the sugar companies have gone into the matter fairly completely. The position at the moment is that our farmers are getting a higher price for their raw beet delivered to the factories than the Continental farmers are but the sugar produced in our factories is cheaper than that produced in Continental countries. That is something to be thankful for. It would appear that in one field at least we are more efficient than the Continentals.
It is difficult to reach conclusions on this matter. The present position is that six member countries have overproduction of sugar. When it becomes a ten-member unit it is stated that there will be a deficit of two million tons per year. That deficit arises largely from Commonwealth imports to the United Kingdom under the Commonwealth Sugar Agreement, which is terminable in a few years time. The amount of beet on the Continent is controlled. There is a price up to a certain level, after which the price is lower. Above that all sugar produced must be exported. There is no subsidisation. There is a three-tier price system obtaining as regards sugar on the Continent but it is a market which would seem to me to have a doubtful future, taking into consideration the concessions given to France. If Britain demands and insists on like concessions for her best providers of sugar, then I feel the outlook here could be more problematic.
I have little to say about cereals. The Minister for Agriculture and Fisheries stated that the view of his Department was that there would be a move towards coarse grain, towards barley and oats and that the outlook for wheat would probably be more problematic.
World conditions would probably affect both wheat and rice. There are the huge granaries of Canada and America. In addition, there has been a tremendous upsurge in the production of wheat in Mexico brought about by the development of special breeds of seed. There has also been a tremendous upsurge in rice in the Philippines, again through research largely carried out by the Rockefeller Foundation. Rice production in India has increased tremendously as a result of research. All these are factors which may have an impact in the future. The matter is so complex and involved that I do not think anybody could reasonably try to read into the future.
Agriculture is the first sector in which a common policy is financed through a central budget which now reaches 1.7 billion dollars. It is interesting to note that while agricultural production has increased considerably in the Common Market over the last decade American imports into the Common Market have steadily increased also. This has occurred despite the failure of the United States of America and other countries to extend the Kennedy round negotiations in agriculture to any material degree. I do not know whether they will succeed in doing that in the future. I doubt it because Europe insists on other countries which want those concessions putting their own house in order and raising their agricultural home prices to a more realistic figure to bring them more into conformity with conditions obtaining on the Continent.
Since 1967 a single market stage has been evolved for beef, pigs, dairy produce, poultry, eggs and rice. The EEC target prices have remained unchanged for the past three years but they are higher in terms of sterling because of depreciation in the exchange rate. As each product has been communised— a Community problem—the cost of supporting prices by market intervention and export subsidies has been transferred from the individual Exchequers to the Community as a whole. As a consequence, the Community expenditure has mounted rapidly because (1) of greater Community coverage and (2) greater Community production. Both occurred. It was not to be unexpected that, as prices were made more attractive, production increased. This increases the difficulty that anyone trying to foresee the future in respect of markets here has to contend with. There are so many inter-related and imponderable things to be considered that one would well-nigh have to have the gift of prophecy to be able to fore-tell what the trend will be in some aspects of this problem.
We have been told in one of the Government papers that entry into the EEC would relieve us of some of the support we have to give from the Exchequer to the farming community. In the last Budget, £90 million was the figure for various aids to agriculture. It was suggested that particular aids to agriculture would be reduced by £38 million but, as a counter to that, we would have an expenditure of £19 million that we would have to pay to the Community funds. I do not know how that has been calculated but it is a figure that will not remain at £19 million because, since the beginning, it has been an expanding figure.
Various methods of financing this Community fund have been devised over the past few years but they have finally been settled. According to the British White Paper, from 1975 onwards all levies and customs duties will be handed over, less 10 per cent to cover collection costs and, instead of budgetary contributions, the balance will be met from contributions from Member States, at the most, of 1 per cent of added value tax. This raises, of course, the very difficult and rather complex problem of taxation and how it will evolve under EEC conditions. I understand from the Minister's speeches that they accept that we shall have to use the added value tax and that our own system of taxation—turnover tax, wholesale tax and retail tax—is readily adaptable and can easily be turned into an added value tax.
The policy to hold agricultural prices at a fixed high level, which has been the kernel of the thinking in the Common Market, has meant that production has increased and wheat, sugar, cheese and butter production has moved from a position of deficiency in the 1960s to one of surplus in the 1970s. This trend has culminated in all the measures I have already mentioned to cut down agricultural production under the Mansholt Plan. I need not reiterate those points. However, it shows that here we have a market of opportunity. We also have a market of great potential for competition. It is not a feather-bed job. This will be a highly competitive exercise. Unless our people have that ability, grit and determination—we are, I think, inclined to be a lazy race—unless we improve our thinking in that respect, we are entering into an era of competition where there are great opportunities to advance and equally great opportunities to go to the wall.
In general, therefore, it would appear that, as regards our future position here, there will be a considerable change in food prices for both producer and consumer. The producer will get more for his product: the consumer will pay more. Of course, that has been the rub; that has been the difficulty all along the line. Our friends across the water could never face up to the idea of the British housewife having to pay 7s per pound of beef when she could get it for 3s, or of paying a higher price for her butter than that at which she can get it somewhere else.
There are many other difficulties that one cannot foresee. Despite the fact that production has increased in the Common Market over the past decade as a result of higher prices, it may be that production will deliberately and artificially be curtailed in the future as is occurring at the present time. No one knows how long that will continue but the present tendency is to curtail agricultural production. The Common Market is not a closed community. Despite the fact that there is a common tariff wall and an adjustable levy, it is still not a closed Community and the Community itself can make and has made trade agreements with many other countries. Some of them are to the satisfaction of the countries and some are not. I think they made trade agreements with Greece and that they are in the process of making one with Spain. They are quite free at any time to enter into new trade agreements in general or as regards a particular sector of the economy or as regards a specific commodity.
We do not know what the position will be and—a very important matter to us—we do not know what the ultimate position will be as regards the British Commonwealth—the position of New Zealand lamb, New Zealand agricultural exports, New Zealand butter; we do not know what the position will be as regards sugar from parts of the British Commonwealth.
Finally, we do not know what the level of the contribution to the agricultural fund will be. It has not been spelled out exactly how the figure of £19 million was arrived at. I do not know how that computation was made but I would hazard a guess that that is the opening gambit and that, with the passage of the years and the expansion of the Community, that contribution will be considerably upgraded.
By and large at present it would appear that whatever contribution we may be called upon to make to the Community fund will be more than balanced by the savings which we will secure on the question of subsidisation of agriculture. This has been an increasing burden on us—trying to subsidise agriculture and to sell our products sometimes in very unprofitable markets. What we do not realise is that Britain is subsidising her farmers to a very substantial degree. Down through the years, Britain being our only market, we have been forced to subsidise our farmers to enable them to sell on the British market, simply because Britain has subsidised her own farmers heavily. I should like the Minister to tell us how this figure of £19 million was arrived at. The Government's White Paper does not give any estimate of the levies, or customs duty, or value added tax, on which this computation was based. It is on figures like that that such a computation of such an estimate must be made.
There is another aspect of the Common Market which is of some agricultural interest, that is, the question of regional development. One of the main aims in the Treaty of Rome is the development of backward regions in the Community. I must admit that, as far as I know, as yet no common regional policy has been developed. Regional planning and development remains almost entirely in the hands of national Governments. All countries have problems of regional development. We are not the only country with a problem like the problem of the west of Ireland. Italy has her problem in south Italy. There is a problem in the south-western part of France. Holland has the problem of her northern region. Even West Germany has got a regional frontier. These are problem areas in those countries just as we have problem areas chiefly on the western seaboard.
A European investment bank was set up under the Rome Treaty with a capital of one million dollars to aid these backward areas and since the EEC came into operation help has been given in many areas, for example, for road construction in Italy. There were some schemes in France and a scheme of railroad electrification in Germany. While no specific regional development scheme has been worked out as yet in the Common Market, the principle is accepted that one of the purposes of the Rome Treaty is to help backward regions and backward communities. This is something for which we should bargain strongly. When I mentioned the question of subsidy for mountain sheep I had in mind the question of regional development, the question of our being allowed to continue to subsidise and help the sheep industry in the poorer parts of our western seaboard.
To those who say we should not go in I have already said it is a question of Hobson's choice. There is an atmosphere in this country of ours of pseudo affluence. Certainly, if you go around the singing pubs it is Bob's your uncle and they are all able to have a double this or a double that. That affluence is not as real as it seems. When we come to examine certain data in relation to our economy, the position does not look so good. I want to say this in defence of our move to join the Common Market because I feel we have not been doing well and I fear we will do less well. If we fail to get into the Common Market we will have to seek some modification of the Anglo-Irish Trade Agreement. I think everybody concedes that if Britain goes into the Common Market we must go in.
Where would we get a ready market for two-thirds of our exports overnight, or even over a space of a few years? We have been trying to get an alternative market since the State was founded, when conditions were better than they are now, when there was no Common Market, when there was no common customs barrier against us, but we failed. Whatever chance we had then we have less now because, as I mentioned already, we have not sold a beast into Europe since 1960. In those circumstances if we cannot export to the Common Market as it exists at the moment, how can be export to Britain when she joins the Common Market?
