I believe that there are political considerations in the case of New Zealand but I think the Minister should be vigilant in relation to all imports of beef from outside the EEC.
The Bill is welcome in that it gives a statutory basis to CBF. CBF have been operating for some time with public funds and have been in receipt of Government grants. Grants should not be made available to companies that are not statutorily established. Public money should not be spent on bodies of any sort unless there is a statutory guarantee that the money will be used properly. Although CBF have been operating as a private company for a number of years they were not obliged to present to this House an annual report of their activities, even though they have been financed from public funds. As we provide the money, we should be given an account of their activities. There are no requirements in relation to the checking of their accounts by the Comptroller and Auditor General. It is regrettable that CBF have been so long in existence without being given a statutory form. I welcome the fact that they are now being given a statutory form and that there are certain assurances in regard to their accountability for public funds.
I also believe that bodies in the category of CBF are not subject to sufficient scrutiny. I have advocated that a Committee of the House be set up to review the activities of all of these bodies which are not at present covered by any committee of inquiry in this House. I have a motion on the Order Paper at the moment for this purpose and I have included CBF in it. It is important that any body receiving public funds should not only have to present accounts but should be subject to detailed scrutiny by Members of this House. I hope the Minister will in due course see his way to accepting that.
I also draw attention to the fact that there is no requirement that CBF present their annual report to this House within any specified time. The requirements for an annual report are dealt with in section 16 of the Bill and the report could be presented anything up to five, six or seven years late. I am aware that there are certain bodies which are required by law to present annual reports to this House and I know of one body—not under the aegis of the Department of Agriculture—which, although statutorily required to so do, has not presented any report to this House since 1974. There are bodies under the aegis of the Minister, particularly an Foras Talúntais, which have been up to 18 months late in presenting their annual report to this House.
It is just not acceptable for bodies in receipt of public money to be so late in presenting their annual report. No private company would get away with that. If a private company was more than 60 days late in presenting its annual report to the Companies Office they would be liable to prosecution. There would be a lot of State bodies whose board of directors would be liable to prosecution if they had to present their reports to the Companies Office. But they have to present their reports not to the Companies Office but to this House. One would have thought that they would have had a higher obligation rather than a lesser one in this regard and yet they have been late in the presentation of their reports. I would like to see built into this Bill a requirement that CBF must present their report within a specific time and I would say that four months should be the maximum time from the end of the year to which the report applies.
I also believe that there are certain new borrowing powers which are being given to CBF under the legislation. These are contained in section 17. It is important that borrowing should only be undertaken by a State-sponsored body such as CBF to finance activities which are themselves intrinsically self-financing, that is, profit making or break even types of activities. It is not right for a State body to borrow to finance activities for which it expects to receive a grant from the State. In effect that involves holding a gun to the head of the State, because if they go ahead and do something with borrowed money they can then come back to the State demanding the money to repay the bank for what they have done. We would then have a situation where the revenue being raised by the Minister for Finance is being more or less earmarked in advance by a body outside this House. There should be a clear provision built into this Bill that while CBF should be free to borrow they should only be free to borrow in respect of activities which are of themselves self-financing.
There should be an entirely separate accounting procedure and a separate fund established for the financing of self-financing activities in respect of which borrowings could be undertaken and another fund established for State-financed activities in respect of which borrowings should not be capable of being undertaken. That is an important distinction in public finance which should be made. There is unfortunately a situation where more and more bodies are being given the power to borrow even though they are not self-financing bodies, and that is not desirable. I can well see the point in allowing State-sponsored bodies which are self-financing to borrow but not bodies which are largely or wholly financed by the State.
In section 20 there is a reference to the disclosure of interest in any contract which the board proposes to make by a member of the board who might be interested in that contract. The protections there are insufficient. I do not want to get into specifics here but there is a possibility that members of the board may be people who are engaged in the meat industry themselves. For instance, the chairman of the board could be involved in the meat industry. As members of the meat industry they naturally would have an interest in making sure that they made the largest profit for their own enterprise and they will naturally try to make use of any information they can get to find new markets.
I believe that any information CBF have about new markets should be given out on an entirely even-handed basis to all members of the industry. There should be no one who would have any greater access to this sort of information than any other member of the industry, whether he be a member of the board or not. There must be statutory safeguards, and I intend to propose amendments on Committee Stage to prevent any member of the board, whether he be the chairman or otherwise, from getting information from the CBF which would be commercially useful to him in advance of any other person in the industry. I know that it would be very difficult indeed to operate such a protection, because ideas and so on will come up in the course of discussions at board meetings where information of this sort can become available. However, I am sure the Minister will understand that, if one person is in a position to get that sort of information while other members of the same industry who are in competition with that person feel that they are not getting that information, there would be problems in the maintenance of a trusting relationship between the industry as a whole and CBF.
The Minister must, if he wants to have appointed to the board people directly involved in the trade, provide a means of ensuring that those people do not have any privileged access to information. I agree with the Minister that people who have experience in the industry and are directly involved in it should be on the board and I do not want to be construed as saying that I am opposed to such people being on the board. But, if they are, there must be some method of ensuring that they do not or cannot make use of their position on the board in a way not open to people who are not on the board. I do not belive that the terms of section 20 are sufficient to ensure that because they only extend to a declaration of interest in an existing contract which may be the subject of activity of the board. I am not so much concerned about existing contracts but I am concerned about the possibility of future contracts which might arise in the case of one person who has, by virtue of membership of the board, earlier access to information that other people in the same industry with whom he is competing and on whose products a levy is being raised to finance CBF. If that were to happen it would not be fair and I would like to see safeguards built into this legislation to prevent it happening.
I am not saying that this is happening because obviously nobody would know if it was but, as I said, the possibility exists when people on the board are involved in the trade. The provisions of the Bill should be extended to ensure that this possibility does not or cannot arise.
The board are being given a new function: to provide for the exportation, either as principal or agent, of beef. Up to now they were allowed to engage only in the promotion of beef, not in the actual export of the product. If they are to export they must be able to buy and sell, because presumably they will export on their own account. Nowhere are the board actually given the power to buy or sell beef, although they have the power to export. In case this matter might be challenged at a later stage, it should be written into the legislation that the board have power to buy and sell beef.
The board have been given the new power to engage in trading in beef only "to such extent and to such markets as the Minister may from time to time direct". That is far too vague and seems to be giving the Minister too much power. He will allow them to engage in trading in one market but not in another. For instance, they might be allowed to trade in a market where one Irish producer was already engaged but not in another market where another Irish producer was engaged simply by the Minister saying "You may export to country A because I am not too worried about the Irish producer there, but you may not export to country B because you might damage an existing Irish factory there."
In his speech the Minister said, "I want to make it clear that I do not see CBF going into competition with our existing exporters—quite the contrary in fact." That is his word contained in his introductory speech, but that will not be the law of the land. The law of the land will be that they may export "to such extent and to such markets as the Minister may from time to time direct", without any limitation as to whether they may compete with other Irish producers or whether the Minister may exercise this function in a discriminatory fashion. The criteria whereby the Minister may or may not allow them to sell in competition with private Irish exporters in given markets should be written into the law. The Minister should not be given the discriminatory power to say, "You may export to Fiji but you may not export to Samoa." The conditions under which the Minister may exercise his discretion to allow CBF to export to a particular market should be written into this legislation. It is not good enough for the Minister to say that it is not his intention that they should be in competition with other Irish producers because as the law stands there is no statutory requirement that this would take place.
I am also critical of the method of appointment of the board, which will be by rotation with one-third of the membership retiring each year. It is not a good idea to have somebody retiring from a board each year because one would never get the spirit of collegiality that is needed on a board. The board should be able to plan for the following five years in the hope that if they do a good job they will be reappointed. I realise the rotation system is to get an infusion of new blood on the board every year, but that is a trendy idea and I do not think it will have that effect. The Minister would be better off if he changed this Bill and appointed the board en bloc for five years. I hope he will consider that view carefully.
Perhaps the Minister would give some information about the beef classification scheme. Last year we provided on a statutory basis for the establishment of this classification scheme. At that time I was critical of that scheme because the classification scheme on which Irish beef would be sold abroad did not and could not coincide with the type of classification scheme whereby French beef was being sold. We were trying to export on the continental market in competition with the French, but our beef was not being classified on the same basis. If we had the same classification scheme, a person buying our beef could make a quick and easy comparison between the Irish beef and the same class of the French beef. It seems unusual that there should be a series of different national classification schemes in use on the same European markets. How has this scheme been working? Has the Minister considered altering the means by which the different classifications are set?
I understand from a report on beef carried out by the Confederation of Irish Industry that one of the things needed to encourage greater trade in beef is the implementation of an internationally enforceable code of trading practice in beef and export credit guarantees for beef. Have the Department studied this matter and the extent of the problems being faced by the industry in the absence of any code of practice in the beef trade on international markets? Can he take any initiative internationally to have such a code established, because I presume there is a genuine need for it?
I referred earlier to the need for greater employment in the beef industry in the processing of beef products. We cannot make much progress unless we can ensure that our beef is processed to the furthest possible extent before it leaves our shores. There have been considerable improvements in this situation, particularly in the term of office of Deputy Clinton as Minister. In 1974 only about 24 per cent of our beef was denoted before it was sold in individual cuts and the rest was sold as whole carcases. There was an improvement in that situation throughout the period of the present Government. We should set a clear target for our industry by a particular date in the proportion of beef which should be denoted for export. The Government should commit themselves to achieving that half of our beef is exported in a deboned form by 1982. The more beef deboned the more employment there is for boners in the factories and for various people in the processing of the meat.
One of the problems we have been facing in ensuring greater processing of beef in this country has been the absence of any MCA on canned meat. An MCA has been made available on chilled beef but not on canned beef. I understand that the Minister has been engaged in discussions on this matter. I would have hoped that something would have been done in this situation.