asked the Minister for Trade, Commerce and Tourism if he will outline in detail the subsidies that are available to bakeries in the Republic compared to those available in Northern Ireland, with particular reference to a subsidy paid in respect of bread from Northern Ireland being sold in the Republic at 15p per loaf.
Written Answers. - Bread Subsidies.
535.
The subsidies paid in respect of bread are consumer subsidies and not an aid to the bakery industry. For administrative reasons bulk payments are made to bakeries in the case of home-manufactured bread and to agents registered in the State in the case of imported bread. The benefit of the subsidy accrues to the consumer through the mechanism of the Maximum Prices Orders under which the price of bread subject to control is reduced by the full subsidy payable.
The bread subsidy which was introduced in 1975 was originally confined to bread manufactured and sold for consumption within the State. In 1979 the EEC initiated action against Ireland on the grounds that the manner in which the subsidy was being applied was contrary to the provisions of the Treaty of Rome. Under Articles 92-94 of the Treaty, in the case of goods originating in the Community, consumer subsidies must be applied without discrimination as to the origin of the products. In these circumstances proposals were put to the EEC for the phased extension of the subsidy to imports from other member states (including Northern Ireland) and the procedure against Ireland was then terminated. Subsidy payments in respect of Northern Ireland bread imported into the State are made in accordance with these arrangements.
The present rate of subsidy payable on standard bread manufactured and sold for consumption within the State is 15½p per 800 gm loaf and pro rata on other standard size loaves. In the case of bread imported from Northern Ireland for consumption within the State, the rate of subsidy payable is 13p per 800 gm loaf. In accordance with the arrangements with the EEC, this rate will increase to 14p per 800 gm loaf with effect from the 25 October 1981.
I am not aware of similar subsidies on bread sold in Northern Ireland.