The point I was making is that in view of the present state of unrest in the farming community that has emerged since last November when the Minister made the speech to which I have referred, I would have expected the Minister to give some information on Government thinking in relation to the case that has been put forward by the various farming organisations. I believe that at the present time the agricultural industry is in a state of unprecedented chaos. Farming organisations have begun a campaign of civil disobedience and other forms of protest.
The question we have to ask ourselves is why have the farming community in this year of 1971 decided to resort to these forms of protest, bearing in mind that the farming community as a rule are peaceful, law-abiding people who in order to make a living have to work on their holdings round the clock seven days a week. The House will appreciate that when a section of the community like the farmers feel compelled to engage in a campaign of civil disobedience and other forms of protest there is something radically wrong.
There must be grave reasons why the farming community are now engaging in protests. I believe the farming community are as much entitled as any other sector to raise their voices in protest against injustice, against the fact that their problems are not being solved. The fact that they have resorted to these various forms of protest leads one to conclude there must be very serious reasons. From what I can gather from my contacts with the farmers and my interest in agriculture, there are many reasons why the farming community are up in arms. The problems are complex. It is possible to identify certain key factors which led the farmers into taking the course of action that they have taken.
Looking back at Government policy over the past seven or eight years, particularly since the introduction of the Second Programme for Economic Expansion, it will be seen that their policy in relation to agriculture has been a history of blunders, a history of stop-gap measures which, in most cases, were dictated by political expediency. Since the introduction of that programme there has been no real effort to formulate and implement a comprehensive, dynamic and long term policy for agriculture. In addition, the farming community have had to face a situation of continuous rising costs coupled with a continuous fall in their income. There has been a worsening in their income vis-à-vis other sectors of the community. Leaders of farming organisations are now claiming that the average weekly income of a farmer is £8 less than the average income of those in other sectors.
This figure of £8 has been quoted time and again from public platforms and so far it has not been refuted by the Government, by the Minister or by anybody else. At Question Time last week, the Parliamentary Secretary, who was deputising for the Minister, was challenged on this income differential but he did not refute the figure. I described the situation as a grave social injustice.
I believe the figure of £8 to be correct. This differential is a shocking indictment of Government policy—it is an indictment not only of their policy in relation to agriculture but of their whole approach to economic development and social justice. What has been the result of the irresponsible manner in which the Government have dealt with the agricultural industry? The result is that the farming community have now realised that they must fight for survival because, as a result of the Government's policy, 14,000 persons have been forced to leave the land each year.
The present difficulties in relation to the industry were referred to by the Minister when he spoke of the divergence in trends as between the incomes of those in agriculture and those in other sectors and he tells us that the Government have now decided on a series of measures to improve the income position of farmers. When the Second Programme for Economic Expansion was introduced, I stated that the Government and their experts, forecasters and economists had made a fatal mistake. I said this because the role assigned to agriculture under that programme was unreal. The targets were unrealistic in that they were too low. In other words, there was failure to recognise the fundamental importance of agriculture and its potential contribution in an expanding economy. There was also the failure to give representation to agriculture on the NIEC.
However, the greatest failure of the Government in relation to agriculture has been their failure to recognise the key role which co-operation could have played in developing agriculture to its fullest potential. On every occasion on which I have spoken here on agriculture, I have referred to the principle of co-operation. A golden opportunity was lost by the Government during the past decade because of their failure to formulate and implement a practical programme of co-operation; their failure to apply to Irish agriculture the principles and practice of co-operation that have been tested and tried in other countries. I am even more convinced that the only hope for the preservation and future viability of the average family holding is through the practical application of the principle of co-operation.
The great tragedy of Irish agriculture in the last 20 years has been the scrapping of the parish plan. The more one examines the social and economic problems of rural Ireland and of Irish agriculture the more one becomes convinced of the tremendous foresight and wisdom of that great apostle of rural Ireland, the architect of the parish plan, the late Canon Haves, the founder of Muintir na Tíre. That unique plan was initially in advance of any other plan in Western Europe and it has now been accepted in many countries. Here it was never given a fair trial. It was a tragedy that the plan was not modified to enable it to work successfully. The greatest mistake made by Fianna Fáil when they returned to Office in 1957 was the scrapping of the parish plan. I regard the failure to formulate and implement a proper policy and plan for co-operation in Irish agriculture as the greatest failure on the part of the present Government and that failure is the greatest tragedy in Irish agriculture today.
The Minister referred to the State subvention to the creamery and dairying industry. The history of Fianna Fáil policy in recent years in relation to agriculture has been a history of blunders and that is nowhere more apparent in the agricultural industry than in the dairying sector. The Minister says the increased subvention will cost the Exchequer more than £3 million in a full year and the creamery milk suppliers will have the additional benefit of the Bord Bainne levy. That is the only reference the Minister made to the dairying industry. Our dairy farmers, particularly those in the creamery areas, are the most vocal at the moment in their demand for a better deal from the Government and it is only right and proper that some attempt should be made to assess the situation and to examine the demands for an increase in the price of milk and an improvement in their incomes.
Dairying is the most important sector of our agricultural economy. It is a major national industry. It provides a livelihood for 120,000 dairy farmers and their families. It provides direct employment in the creameries, in the processing industry, in transport, distribution and so on for a further 10,000 people. When one looks at the contribution made by the industry to the national economy in the matter of direct exports one finds that these are now running at £30 million per annum; that is the direct contribution made by the dairying industry to our total agricultural exports. Dairying is the foundation of our agricultural industry and, unless we have a viable dairying industry, we cannot have a viable livestock industry. I am sure the most urban-minded person and even the armchair academics, who drive me up the wall, appreciate the fact that dairying is a fundamental and vitally important industry from the point of view of the national economy.
I do not ask for a better deal for the dairying industry or an improvement in the incomes of dairy farmers simply for social and economic reasons. There is another reason: the acid test of any industry is its performance. In advocating additional State assistance to the dairying industry one has to examine the performance of that industry. A very satisfactory picture emerges, despite the lack of long-term planning for the industry by the Government, the various stop-gap measures and so forth. Over the past six years the dairying industry has proved itself to be a highly efficient industry, an industry which can produce products to be sold on the British market at premium prices. The price commanded by Kerry Gold Butter is the highest of all imported butters in Britain. Not alone are we holding our own with the Danes, the New Zealanders and the Dutch from the point of view of quality of product and attractiveness of presentation but the British housewife is actually prepared to pay more for our product.
What has been wrong here is the fact that farming organisations have not, perhaps, emphasised enough the fundamental importance of the dairying industry. It is a viable industry which has proved itself. It is an industry in which, so to speak, the men can be separated from the boys from the point of view of the export market. It is not an industry composed of people incessantly moaning and ullagoning.
Another very important aspect in relation to this industry is the fact that our dairy farmers and our creamery milk producers are receiving the lowest price of any dairy farmer in Western Europe. Despite our products commanding premium prices on the export market our dairy farmers are the lowest cost milk producers in Western Europe. The average price per gallon paid for creamery milk is only half that paid in the Common Market. If the Government had any foresight at all, any concept or realisation of the importance of this industry to the economy, directly and indirectly, surely the formulation and implementation of a proper long-term plan for the industry should have been a top priority in Government policy. It should be a top priority. The dairy farmers who have been forced to fight for survival and for recognition of their just grievances are at present resorting to a campaign of civil disobedience. If we had proper Government policy this would not be necessary now. Far from having had a proper policy for the dairy industry we had a ridiculous situation where for a period of three or four years, from 1964 to 1969 in fact, it was the policy of the Government to induce every dairy farmer to increase milk output. This was deliberate government policy and the target laid down in the Second Programme envisaged such expansion. All the resources of the Department through the advisory services were thrown into a campaign for about five years directed to increasing milk production. This was the Government's policy.
I do not think it is necessary to spell this out from the Second Programme documents and the numerous speeches made by the different Ministers for Agriculture in that period.
In the mistaken belief that they were doing the right thing, heeding the advice of the advisory services, thousands of dairy farmers involved themselves in very heavy capital commitments in improving grasslands and the stock-carrying capacity of the lands, installing the most modern dairy equipment, introducing the most up-to-date milking equipment and in making every effort to produce top quality milk and adopting modern methods of grassland management and intensive grazing. All this was done following continuous exhortations from the Government and on-the-spot advice transmitted to them by the advisory services.
What happened? Before the target fixed in the 1964 Second Programme for Economic Expansion had been reached—530 million gallons I think it was—the then Minister for Agriculture in 1969, or early in 1970, announced out of the blue that there was now panic; there was surplus milk and in order to curtail milk production the Government had decided to introduce a new pricing system for creamery milk which has since come to be known as the multi-tier system. This decision by the Government was the worst and most retrograde step ever taken by any Government. The multi-tier system of milk payments has no precedent in any dairying country in Western Europe or in the world, so far as I know. It runs completely contrary to the payments system in the EEC countries. Before the target for the Second Programme had been reached the cry went out that milk production should stop and the very farmers who responded best to Government exhortations to increase milk production found themselves overnight faced with a situation where they would have to take a substantial reduction in income because if they exceeded a certain figure of milk production the price went down. There was a graduated scale.
This is the system that operated in 1970. It is a ridiculous and stupid system and events have now proved it to have been stupid and ridiculous because as a result there has been in 1970 a significant reduction in milk output so that Bord Bainne found themselves on a very sticky wicket towards the end of that year. They were worried lest they might not be able to meet export commitments they had entered into. A fortnight ago the stupidity of the multi-tier pricing system for milk really hit us between the eyes, so to speak, because Great Britain where our butter is commanding a higher price than the produce of any other country exporting butter to Britain, were looking for 30,000 tons of butter and we could not supply one pound. This is a diabolical situation which further proves my original contention that there is a lack of long-term policy for the dairying industry.
At Question Time last week I challenged the Parliamentary Secretary about this matter. He attempted to get around it by saying that they could not forecast or foresee this development. If we could not foresee it there is something radically wrong. Surely our market research is sophisticated enough, or should be in a position to get advance information of the market position and market trends in a country only a few miles across the Channel? If this had been the Malaysian or some such market there might have been some excuse for not being able to foresee this development. We had an opportunity to supply 30,000 tons of butter to Britain a few weeks ago at top price and we could not do it. I believe the downward trend in milk production will continue.
When Deputy Blaney as Minister for Agriculture announced the multi-tier system I told him that I would advise dairy farmers to continue in milk production. I was confident that before one year had elapsed the stupidity of the multi-tier system and the stupidity of the decision to curtail milk production would have become obvious. Unfortunately many dairy farmers have gone out of milk production and they have no intention of going back into it. I forecast that in 1971 there will be a further and more alarming decline in milk production. We find, in 1971, the Minister for Agriculture coming in here with a two-page brief for a token Estimate. At the same time we find the farming community resorting to campaigns for an improvement in their incomes. Since I became a Member of this House nearly ten years ago I have spoken continuously about the dairying industry and never in those ten years have I seen the morale of the dairy farmer and of the people engaged in the industry at a lower ebb.
This most important industry is now in a state of absolute chaos because the people in the industry, the farmer, his worker, the creamery employees, those engaged in the processing plants, do not know what the policy of the Government will be for 1971. This is why I expected the Minister to give us some indication of what the Government's policy is to be for 1971 in relation to this industry. As I say, I have never seen the morale of the people in the industry at a lower ebb, or seen the industry in such chaos, and I want to warn the Minister that it is absolutely imperative that he should immediately formulate a comprehensive, long-term plan for the industry. I am not given to making exaggerated statements here because I like to do my homework but I want to say that if such a policy or plan is not implemented in February or March—time is getting short now— the position in the dairying industry will decline still further and in three months time, or six months time, or at the end of 1971 we could find ourselves faced with a very serious situation.
There is another aspect of this whole matter. Apart from being a terrible indictment of the Government it is a national tragedy that when we are negotiating in regard to our entry into the European Economic Community the one major industry that has the capacity and potential to benefit from such membership finds itself in a state of utter chaos and confusion. Despite the stop-gap measures of the Government and the lack of policy the industry has proved, by its performance in recent years, to be as good as the dairying industry in any other European country with which we will have to compete when we join the EEC. In view of that surely the Government should have given special priority to the industry and ensured that when we enter EEC the industry will be fully geared, that the morale of the dairy farmers will be at the necessary high level and that we will be able to go into Europe with confidence in the ability of our farmers to produce top quality milk efficiently, with confidence in the ability of our creameries and processing plants to produce top quality products as good as any in Western Europe.
Surely this consideration should have compelled any Government who realised the importance of agriculture to have a proper long term plan for dairying? If more farmers go out of milk production what will happen to the industry? What will those people in the export markets which we have built up so successfully in recent years for dairy products, think about our marketing board and about us if having gone to the trouble and expense of getting these markets we say tomorrow: "Sorry, we cannot supply you"?
What will be the position in the livestock industry? What will be the repercussions and implications for our livestock exports and our beef and meat exports from a reduction in milk production? I say without fear of contradiction that the downward trend experienced in 1970 will be continued in 1971. It is a serious situation and I appeal to the Minister to take immediate action regarding this position.
Despite the fact that the Minister had only a two-page brief he did say that he would deal extensively in his reply with the points raised in the debate. In the light of that statement I want to get his views on a number of other problems. I am not as accurate as I used to be in matters relating to the dairying industry; this is one of the penalties of specialisation. When one finds oneself on the Front Bench—and this applies to all parties—one has to specialise in particular aspects of the work of certain Departments. There has been much talk in recent years about rationalisation and amalgamation of the creamery industry. The subject has been bandied about, talked about, and written about, but no worthwhile progress has been made. If one asks any dairy farmer what he thinks of amalgamation and rationalisation it is obvious that he does not want to hear about it.
Quite apart from all that has been said and all the controversy that has been aroused, so many studies have been made on this subject and so many reports have been issued that it is impossible to keep track of them all. I remember the survey team set up by the Department of Agriculture to examine the dairy products industry. I remember the study carried out by Dr. Knapp. There was much documentation issued by the IAOS and the various dairy organisations on this question. American consultants, Messrs. Cook and Sprague, were called in. In the past year a committee was set up by the Minister to make final recommendations regarding amalgamation and rationalisation.
This is an important topic and it is relevant to the points I have made regarding the need for long-term rational planning for the dairying industry. We have wasted five or six years just talking about it and so many people have said so many different things that persons connected with the dairying industry do not know what is the position. It is obvious to anyone who knows anything about that industry that a certain amount of rationalisation is necessary and some amalgamation is essential. Unfortunately the big blunder made was the attempt to implement almost overnight a major national blanket policy—the famous 19 points plan which was introduced some years ago.
This scheme should have been carried out on a phased basis. We should have identified the places where the need for rationalisation and amalgamation were so obvious that everyone could appreciate that need. We should have started on a pilot basis and thus learned as we went along what were the economics of amalgamation and what benefits would accrue to the farming community. We should have been able to tell the farmer how much extra money he would receive by agreeing to a policy of amalgamation. Instead of this a complete plan was thrown at the dairy farmers, and the impression was created that there would be 19 major creameries and the others would be closed. Naturally this was rejected out of hand.
This brings us to 1971 when we are facing entry into the EEC. Any long-term planning in relation to the dairying industry must contain plans for rationalisation of the creamery industry. I do not know what are the Government's views on this important matter. I do not know what has happened to the study group that has been set up. If the Government, the IAOS, and other State and semi-State bodies concerned with this industry are convinced of the wisdom of amalgamation why do they not start with the Government's own semi-State company—the Dairy Disposal Board?
On previous occasions I have pointed out an outstanding case that calls for amalgamation or rationalisation in the Knocklong group in County Limerick. In this instance there are six or seven small branch creameries attached to the Knocklong central creamery. The average number of suppliers to each of those creameries is about 40 and there are three such branches in one parish. I shall never understand why this was not used as a pilot project for rationalisation and amalgamation. I hope when the Minister for Agriculture is replying to this debate that he will spell out clearly his views and tell us what decisions have been reached in regard to this problem.
I do not intend to go over every aspect of agriculture because I do not consider myself sufficiently informed or competent to make a detailed analysis of any sector other than the dairying industry. In regard to the latter I have some specialised knowledge, or at least I am interested in the matter. One aspect of agriculture in which the Government have failed completely is in regard to the co-operative movement. I am a believer in co-operation as one who had the great privilege of having known the late Canon Hayes, the founder of Muintir na Tíre, and of having served in that organisation for a number of years before I became a Member of this House. I realise the tremendous potential of the co-operative movement and I regret very much that in 1971 we still have not developed a formula by which we can apply the principles of co-operation down to farm level.
However, there has been a slight development in recent times with the emergence of group farming. I have spoken on this matter on a number of occasions in this House as I have had practical experience in this regard. One of the first attempts at group farming in County Limerick was in the parish in which I lived. I notice now the Land Commission are experimenting with the idea. There are a number of farming groups. I think they started in most cases as farm discussion groups. I see Deputy Smith across the way. There is a group in the Newport area and also one in Nenagh. Looking at the traditional structure of the average small family holding, I have always believed that the only way this structure could have been preserved and the only way in which the maximum number of these small holdings could have been made viable was through co-operation, through farming a number of small holdings as one unit, where mechanisation and other facilities could be availed of.
The Minister for Agriculture, Deputy Gibbons, is also a keen advocate of the co-operative movement. Over the last nine or ten years, in speaking on agriculture, in this House, he and I have been very much on the one wavelength in relation to the value of co-operation and the potential of the co-operative movement for the agricultural industry. I sincerely hope that, now that Deputy Gibbons is Minister for Agriculture, he will tackle this problem. Whether we look on it as a problem of the west, the fact is that north, south, east or west, a substantial proportion of the farm holdings of this country are small family units. Instead of talking about the west and putting forward all sorts of economic theories as a solution of the western problem or of the problem of small holdings, we should have tackled the problem in a practical manner by enabling small holdings to form viable groups.
I advocated five or six years ago in this House that a specialised advisory service should have been established and that there should be in each county a number of advisers specialising in various aspects of agriculture. I particularly appealed for the selection of at least one or two advisers from every county who would be sent away to be trained in the principles and practice of co-operative group farming. The situation has improved. I would not be so presumptuous as to say that the Department of Agriculture heeded my voice on this but the fact is that there is a move now towards the development of a specialised advisory service. However, the point I have been making is that it is far more important that an agricultural adviser should understand social and economic problems and that he should be trained in the best way of organising small farmers into groups than that he should have technical know-how and scientific knowledge. I have made the same criticism of the Agricultural Institute, which is doing a fantastic job in pure scientific research and doing a bit of work in social research and in research into rural economics in general. However, the Department of Agriculture, the advisory services, the Agricultural Institute, the Faculty of Agriculture in the National University and the other university, have all fallen down completely in one fundamental respect, that is that they have all failed to carry out research into the economic, social and psychological problems which prevent groups of farmers from working together. They have failed to advise on a proper formula for the efficient operation of group farming.
Now that Deputy Gibbons is Minister for Agriculture I hope he will convert into practical reality the interest which he has expressed here in the House on many occasions in the co-operative movement and group farming, and that we can look forward before very long, and before several thousand more small holders have left the land, to having a proper scheme or plan which will make it possible for a group of farmers to work together and thereby make their own holdings individually more productive. Unless we make an attempt to save the family holdings of this country we will eliminate the small holders and we shall end up with a nation of ranchers. Everybody interested in the future of rural Ireland would hate to see this happen. I want to see the traditional family farming structure of this country made viable. I am convinced it can be made viable and that the only way to do it is through the application of the principles of co-operation or through the system which has come to be known as group farming.
I am glad to see the Minister back. I am sorry he was not here five minutes earlier because I was referring to him in rather complimentary terms. I was dealing with the co-operative movement and the fact that the Minister and I on a number of occasions here in debates on agriculture have seen very much eye to eye on the potential of the application of co-operation to farm production and so forth. I hope the Minister will convert his belief and enthusiasm in group farming into reality.
I do not want to monopolise the time of the House, I see Deputy Cluskey is waiting patiently to speak.
