asked the Minister for Agriculture, in view of the relatively low incomes of dairy farmers on island holdings, if agreement to a substantial increase in the butter and milk subsidy will be given.
Ceisteanna—Questions Oral Answers. - Butter and Milk Subsidy.
32.
As a result of the agreement by the EEC Council of Ministers last June on agricultural prices for the current year, the subsidy which island milk producers receive on their skim milk used for animal feeding was increased by about 1 p per gallon in July. This subsidy was again slightly increased as a result of the Green £ adjustment earlier this month and at over 17p per gallon is now about 7.5 per cent higher than the preJuly rate. This level of aid is similar to that paid to mainland creameries in respect of skim milk taken back by their suppliers for animal feeding.
I am at present having the arrangements under which a guaranteed price is paid for farm butter produced on the islands reviewed.
It is very difficult to hear the Minister and perhaps he would raise his voice a little.
It is impossible. It is not the Minister's fault but is the fault of the system.
Will the Minister not accept that farmers on island holdings producing milk and butter are receiving little more than 60 per cent of the price obtaining on the mainland? Will he accept that it is completely unfair that such a position should obtain in respect of island farmers, the smallest holders of all and who mainly have uneconomic holding?
Would he further accept that I have made repeated representations year after year in the Dáil, the last of them last year, and that the position was to be reviewed and that the 16.92 pence per gallon for skim milk which was the only subsidy available to them falls far short of the figure available for milk produced on mainland holdings?
That is a speech.
No, it was a series of questions. The Ceann Comhairle should examine things a little closer.
The Ceann Comhairle is concerned with making progress with Question Time.
The milk is——
Could the Minister speak a little louder?
——used specially and manufactured into butter by the farmers themselves of whom there are 20. The subsidy for the skim milk they get back to feed their animals has increased at a rate of 7.5 per cent since last July. The Deputy asked if I would have the situation reviewed and I am glad to assure him that it is being reviewed at the moment. I do not believe it should take an inordinate length of time having regard to the number of people involved in this case.
Is the Minister seriously asserting that an increase of 7.5 per cent on 16 pence per gallon is adequate? Would he answer my question: is it fair that island milk producers, irrespective of the number involved, should produce milk for 60 per cent of the price obtainable on the mainland? Is that justice for island holders? Or does the Minister want to put them off milk production altogether?
As I have already said, I am having the matter examined to see if it would be possible to pay more for the farmers' butter on this island. The amount of subsidies on the skim milk produced by these farmers is very substantial and has been increased very substantially since last July.
Am I to understand in this connection that the Minister will review the price being paid for the butter?
It is being done at the moment.
I shall ask the Minister again about this later on.
As regards the sound amplification, can anything be done about getting more volume on the speakers because I cannot——
The Deputy has raised this matter before and the technicians have examined the situation. Apparently, they have not solved the Deputy's problem. I shall mention it again.
I would ask that something positive be done about it.
33.
asked the Minister for Agriculture if in view of the fact that milk producers in the small and medium farm sectors are being unfairly penalised for the milk surplus situation, he will reintroduce the two-tier price system or a similar system of pricing in favour of the small and medium farm producer.
The producer price of milk is now derived from the intervention prices for butter and skim milk powder which are fixed on a community basis by the EEC Council of Minister. Member states are precluded from fixing or supporting producer prices on a national basis.
Is not the co-responsibility levy in fact the same thing as far as the producer is concerned except that it is a penalty rather than an inducement? I am seeking an inducement for the small man rather than penalising the big man.
Certain areas of the country and certain farmers are excluded from the co-responsibility levy which is now at 0.5 per cent. It is no possible within the European Community to determine prices nationally and if I understand the Deputy correctly that is what he is looking for. I think that he is looking for the introduction of a two-tier price system and this is no possible under Community law at present.
On the one hand the Minister says it is not possible and on the other he says it is operating in fact——
No, we are talking of different things.
——by way of the penalty clause. The net effect, I submit is the same except that in the case of two-tier or differential weighting in favour of the smaller farmer, it is not discriminate in that the suggestion would be and is that it would be the first number of thousands of gallons that would get the higher price and without penalising those who produce the higher number of gallons. In fact, what I suggest is much more acceptable within Community rules than what is being done at the moment. The £180 million cut which is now proposed by the budget committee will bring about certain things that we will not like.
I think the Deputy is mistakenly trying to equate the exaction by the Community of a co-responsibility levy which is a variable one and may well be varied upwards, and the introduction of a tiered price system of payment for milk. This is not possible. The exaction of a levy has a specific purpose—to restrain over-production of milk. It is just as unpalatable to the Irish Government as it is to a great many others but there is a very real oversupply situation in the Community and the sooner people face up to that the better.
Is it not fact that the over-supply through the larger output of larger producers is where the problem arises and that the penalisation by way of the co-responsibility levy is only the beginning, that the £180 million cut proposed on milk this year will hit the entire industry if it is not restored? I am suggesting a way in which we can have the best of both worlds rather than the worst.
I do not follow the Deputy's reasoning. I understand him to be advocating the extension of the co-responsibility levy in order to procure a situation where the bigger producers are penalised for being big.
That is a weird deduction from what I have been saying. The Minister is well aware of what I am talking about because he had it there and wiped it out when he became Minister a week or a fortnight after I had been booted out of the Department.
Milk production shot up afterwards.
You see what I mean about Deputy Blaney?
(Interruptions.)
It was a very serious impediment to the development of the Irish industry.