I speak in support of the amendment which stands in the names of the Minister for Finance and myself.
Like the Minister for Finance, I too would like, at the very outset, to emphasise once again that the Government fully recognise the seriousness of the difficulties, economic and otherwise, which are now being experienced by the agricultural industry. I have acknowledged publicly on several occasions that the problems are there and that the Government are concerned about them. I am well aware that 1980 has been a particularly difficult year for farmers. Apart from problems of an economic nature related to prices and costs, the year has been marked by exceptionally bad weather conditions. The Government are concerned especially about the implications of the present situation for farmer confidence and about the prospects for future development and expansion of the farm industry which is a vital sector of the national economy.
This is not any late conversion on the part of the Government. For quite some months now the Taoiseach, the Minister for Finance and myself have had several discussions with the farming organisations to see what practical steps could be taken to improve farm incomes. Very early on in those discussions, the Government responded in a very positive way to the problems facing farmers. We acted promptly and constructively within the existing financial and other constraints that must always be taken into account. We provide a wide range of measures designed to alleviate the present difficulties and to encourage renewed investment and expansion in the agricultural industry.
When I introduced a Supplementary Estimate in this House a few weeks ago I outlined the positive measures which had been taken. Those measures included the winter fodder scheme which has in fact produced a very definite and encouraging response from farmers, especially by first-time silage makers.
An extra £23 million under the farm modernisation scheme was also provided. We made provision for up to £100 million of foreign borrowing to enable the ACC and the associated banks to make loans to farmers at reduced rates of interest for both working capital and productive investment, as well as making special provision for young farmers. In addition, the ACC and the banks agreed to take a constructive and positive approach to the restructuring of loans to farmers faced with serious repayment problems. We had also the introduction of a beef suckler scheme which provided for a national subsidy for additional cows as well as the basic EEC subsidy for existing cows.
We greatly increased the headage grants under the disadvantaged areas scheme. The new rates of grant of £32 and £28 are about double the 1979 levels. We also implemented an increase in the subsidy under the mountain lamb extension scheme from £1.50 to £3 per head.
Under the new EEC regime for sheepmeat there will be the payment of a premium on ewes which can be about £7 per head in a full year, depending on market prices. We also had at that time a subsidy on the cost of the warble fly dressing and special assistance for Macra na Feirme, at their request, to encourage the organisation and operation of farm relief services.
In addition, we remitted the second moiety of rates for farmers in the £40 to £60 rateable valuation category and also arranged that farmers in temporary financial difficulties should not be pressed for rates this year.
The measures I have just outlined are largely the list of items put before us by the farming organisations at that time and during those negotiations. Almost to the final item the Government responded to requests made by the farming organisations then. Indeed, when I mention rates, I am very surprised to see a request to abolish rates coming from the Fine Gael benches. I was not aware of the rather sudden change of policy of that party on this important issue. I recall very clearly a statement made by the party spokesman on agriculture at a public meeting in Ballybofey in County Donegal less than two months ago which was in favour of the retention of rates. Why the sudden change of heart on this issue? Perhaps Fine Gael would prefer to forget that particular statement, as indeed they would like to forget everything that happened about that time in Donegal. In any event, this sudden switch clearly underlines Fine Gael's lack of sincerity in putting forward the suggestion that rates should be abolished or, for that matter, any other of the suggestions contained in this motion.
In the course of the debate on the Supplementary Estimate for my Department, some Deputies opposite described these measures in various disparaging terms—using expressions like paltry, useless and inadequate. Of course they were nothing of the kind. They were a genuine effort to help the farming industry in its immediate difficulties. These measures were brought in quickly and were indeed welcomed by the farming bodies as a practical and urgent response by the Government to the situation. Furthermore, those measures were designed to bring help to those farmers who were likely to be most in need of assistance. The £40 million provided for in that Supplementary Estimate reflects the tangible nature of the Government's reaction. That sum did not, of course, include any provision for the concession on rates for farmers in the £40 to £60 rateable valuation category—which will involve an extra £6 million or so.
Deputies opposite would give the impression that the outlook for agriculture in this country is bleak. Of course it is no such thing. I have every confidence that the farming industry in this country can enjoy a bright future. While there are difficulties at present—and there are difficulties also in many of the other member states of the EEC—we should not under-estimate the inherent strength of the industry and its ability to cope with occasional difficulties. Both the primary producers and the processing sector have made enoromous advances since we joined the European Community. There has been massive investment in the industry at farm level. The total State expenditure on grants under the farm modernisation scheme up to and including this year, reached £160 million. This represents a small proportion only of the total investment undertaken by farmers during those years.
It is quite evident therefore, that there have been very widespread and significant improvements on very many farms in this country in recent years. This leaves the industry better geared to withstand a certain degree of pressure and in a position to take off again as soon as conditions improve, For example, I was particularly interested, to note from the survey conducted by the RTE "Landmark" programme that the level of investment by farmers in buildings and land improvement in 1980 was as high as it had been in previous years. Furthermore, there are indications that, while capital investment may be somewhat lower in 1981, a good proportion of farmers still intend to carry out improvements in the coming year.
Equally there has been very substantial investment in recent years in the processing sector. As a result we have now in this country some of the most modern plants in Europe especially for the processing of meat and milk. I made these points not to discount in any way the present problems of the industry but to point to some of the positive aspects we have in our favour. There is a solid foundation to the farming industry, and I consider that we are entitled to have faith in its powers of recovery.
Our discussions with the farm organisations are continuing. It is hardly necessary for me at this stage to reassure farmers at large of the Government's concern about the situation in agriculture. We have already given an earnest of our concern and we are determined to do everything possible to overcome current difficulties. The prosperity of our agriculture depends nowadays to a great extent on decisions taken under the EEC's common agricultural policy. The EEC decisions of greatest impact for us are those which establish the prices that farmers receive for their produce. During the next few months our efforts will be concentrated on the negotiation of the prices package for 1981. In the course of these negotiations, I shall be stressing in the strongest possible terms that, in the light of the current situation in agriculture, the price increases by the Community must be realistic.
There are very definite advantages for the Community itself in maintaining a prosperous agricultural sector. That sector employs nearly 8,000,000 people. Surely it is important to protect that employment at a time when there are over 7,000,000 unemployed in the Community. The CAP guarantees the Community's food supply. It also creates stability in its balance of payments. A prosperous and progressive farm industry is a vital stabilising and constructive influence in European society. Therefore, we do not need to apologise in seeking a fair deal for farmers from the Community.
Apart from our determination to secure the best possible EEC prices package for 1981, we have been examining various other possibilities of securing further benefits for Irish farmers in an EEC context. In this respect, I have had Article 39 of the Rome Treaty very much in mind. That article declares that one of the basic objectives of the CAP shall be to ensure a fair standard of living for the agricultural community. This aim is certainly not being achieved in this country today. Neither is it being achieved in some of the other member states.
It was on that basis that I met with Commissioner Gundelach in Brussels last week, to put to him the serious difficulties facing Irish farmers at present. I explained fully to him the Government's deep concern about the decline in farm incomes here. I outlined to him our case for special assistance—particularly with due regard to Article 39 of the Treaty—and I discussed with him a range of possible options aimed at improving farm incomes here. I was delighted to find that the Commissioner was quite receptive and very sympathetic. He recognised that our agricultural industry here faces particular problems and he undertook to examine forthwith ways and means of relieving our situation. This is already being done and discussions at high official level are in progress.
I believe it is quite logical for us to look to the EEC for effective measures. Most of our trade in farm products is directly affected by the CAP. Let me emphasise that we do not want to change the basic principles of the CAP. We have always been staunch defenders of that policy and we must continue to defend it, especially now when it is coming under attack from various sources. Our aim is to get relief to the maximum extent possible from and within the existing mechanisms of the EEC.
Deputies opposite appear determined, both in this debate and earlier in their contributions on the Supplementary Estimate, to paint a picture of total gloom and depression in agriculture. As I have said, nobody is denying that farmers are going through a difficult time, but the preaching of despondency and depression is no help at all.
I have referred earlier to the very high level of investment that has taken place at all levels throughout the industry. This leaves the basic infrastructure of the industry in a healthy state and is a very positive factor for expansion in the future. I know that the high cost of investment is advanced as one of the reasons why some farmers—a relatively small proportion—are in serious difficulty. On this score, as the Minister for Finance has already told the House, the lending agencies, at the Government's instigation, have indicated their readiness to take a constructive and positive approach to restructuring loans in individual cases where the farmer is in serious difficulty.
This was one of the very important points in negotiations and consultations with the farming organisations. The farming organisations agreed with the banks to participate in special liaison committees between farmers' representatives and the banks on the one hand, and farmers' representatives and the ACC on the other hand. We asked for and got an assurance that those liaison committees will work effectively towards a resolution of these difficulties. I asked specifically for complaints if that mechanism is not working. To date I have not received any complaint.
Another area where we can look forward to positive results is the disease eradication programme. This programme has had the full backing of the farm organisations and the general body of farmers over the past few years. As a result, tremendous strides have been made in getting on with the eradication of brucellosis — so much so that I am quite confident this disease will be totally eradicated in the next five or six years. We are also making steady progress with getting the incidence of bovine TB reduced. The eradication of these two diseases over the coming years will remove one of the few remaining threats to the expansion of our export trade in cattle, beef and dairy products. The State's expenditure on disease eradication is substantial, and the amount contributed by farmers by way of disease levy must be seen as a worthwhile investment by farmers in the livestock industry. We all look forward to the day when these two diseases will have been eradicated and the high costs at present involved can be greatly reduced.
I am completely confident that Irish agriculture will overcome its present temporary difficulties. We have a considerable number of highly efficient farmers, as good as any farmers elsewhere. We have many others who have the capacity to be more productive and efficient. These now have a better range of back-up services to support them than ever before, not only in the various grant schemes but in the advisory and education facilities that are available. I am certain ACOT will recognise the challenge that the present farming situation poses for the new service and that it will rise to the challenge by providing a more cohesive advisory service to farmers. Even Deputy FitzGerald chose to ignore any positive elements on the agricultural scene. He dwelt at length, as other Deputies did, on the level of destocking this year. He and others could equally have adverted to the substantial increase of up to 22 per cent in the numbers of in-calf heifers as disclosed in recent surveys, but that would not suit their case at all.
There are, therefore, many positive factors which augur well for the expansion of agriculture in the longer term. Taking account of these and looking forward, after my recent approach, to constructive proposals from the EEC Commission, I can assure the House and farmers that the farming industry will be well looked after by the Government in its present difficulties.
I am satisfied that it does nothing for the industry to be expounding gloom and fear. Talk in general terms about farming going downhill at break-neck speed is unjustified. I am not saying that farmers have talked themselves into a decline — far from it — but figure-quoting has become something of a disease and there is also a place for positive thinking and we hear too little of that. It has been said that "There is nothing good or bad but thinking makes it so". Certainly bad news seems to be always more welcome than good news. I was particularly pleased to note in fact that at least some people in leadership positions in the farming organisations have within the last week or so deplored any suggestion of cutting back on agricultural production because of the current difficulties. I believe there are enough responsible people around who will recognise that the first to be affected by cutting back will be farmers themselves. Such a negative approach could indeed be seriously detrimental also to the well-being of rural areas and to agriculture based industry. For my part, I have faith in the future of Irish agriculture and will be striving in the weeks and months ahead in the various EEC discussions and negotiations to see that future realised as quickly as possible. The farming industry is too important in this country's economy. We must have confidence in its future.
