Estimates, 1985. - Vote 38: Agriculture.

I move:

That a sum not exceeding £252,304,000 be granted to defray the charges which will come in course of payment during the year ending on the 31st day of December, 1985, for the salaries and expenses of the Office of the Minister for Agriculture, including certain services administered by that Office, and of the Irish Land Commission, and for payment of certain subsidies and sundry grants-in-aid.

A motion for a token Supplementary Estimates will be moved at the end of the debate. I shall be referring to this again at a later stage.

Notes on the main activities of my Department have already been circulated and will, I trust, be of assistance to Deputies. The agricultural sector has experienced a significant improvement in its fortunes over the past three years. In the very exceptional year of 1978 the different factors of prices, weather and market conditions combined to give a uniquely favourable result for farmers and the agricultural sector generally, but this was followed by several years when these factors resulted in particularly difficult conditions. By 1981 net farm output and incomes had fallen sharply. The average farm family income in real terms had fallen by over one-third, and in fact was at a level below that which had prevailed at the time Ireland joined the European Community almost ten years earlier. These were very difficult times for Irish farmers, particularly because they followed years which had fulfilled the expectations of the benefits that would follow from membership of the EC.

Since 1981, however, there has been a major improvement in the situation. Output and incomes have recovered. Net farm output last year was 16 per cent above its 1981 level and was in fact 5 per cent above the spectacular year of 1978. The average income of farm families recovered and was some 20 per cent higher in real terms than it had been just three years earlier. Over this period when real incomes outside agriculture have shown no significant improvement, the position of farmers and their families has made a recovery that has been far better than many of the experts had forecast.

The increase in farm production contributed to the major improvement in our trade balance which occurred last year. It is estimated that agricultural exports in 1984 reached a total of £1,620 million — an increase of some £250 million on the previous year. This growth came largely from an increase in the volume of exports, particularly dairy products, the improvement in prices being relatively small. When combined with estimated FEOGA guarantee receipts of some £650 million the contribution of farm exports to our balance of payments position last year was close to £2,300 million. This is a record in both value and volume terms. The increase in earnings of foreign currency from agricultural exports is particularly welcome because of the low import content involved. In other areas where exports were also buoyant over the past year, the benefits to the economy were partially offset by the extra imports that were required to produce the goods for export.

I should perhaps express a word of caution about the substantial progress that has been achieved in the agricultural sector over the past three years. Particularly since we entered the European Communities, the agricultural sector has been subject to periods of growth followed by periods of stagnation and decline. We need to achieve greater stability in the sector, so that longer term planning at farm level can be undertaken with greater confidence. There is increasing difficulty in maintaining the momentum of price and other improvements in Brussels. If we are to live with greater stability in prices under the Common Agricultural Policy, then not only must we reduce inflation still further, but we must also improve efficiency by reducing the volume of purchased inputs required to generate the level of output at farm level.

Every farmer must look again at the way his own farm business is run. In recent years we have seen a welcome trend towards more efficient use of farm inputs, but this can and must be pursued further if the farm sector is to maintain its present level of prosperity. In the light of the problems we have to face in regard to the prices and marketing of our products, we must aspire to more efficient production of quality farm products designed specifically to meet the needs of today's market. This is not a new idea, but it is one which grows in urgency as year follows year. The Government will, of course, do everything possible to encourage greater efficiency but it is only when this is achieved on the individual farm on a nationwide scale that the benefits will become really evident.

Turning now to EC aspects, discussions on the Commission's price proposals have been going on in the Council of Agriculture Ministers since February. So far the Council has devoted five sessions almost exclusively to those proposals. While the very limited benefits involved for the farm sector may be explained by the financial difficulties prevailing at Community level and the heavy surpluses that have developed in several sectors, nevertheless it is necessary that the fullest possible account should be taken of farm income needs. As in other years, reconciling these factors is proving to be a long and difficult process. The Council meeting in Luxembourg over last weekend continued for four days and even though no settlement resulted, there are expectations that a basis for agreement could emerge at the meeting commencing in Brussels on Monday next, 13 May. My approach has been to seek changes which would represent an improvement from the producers' point of view on what the Commission has proposed. Indeed, in the latest attempt at a compromise by the Italian Presidency, a significant improvement was provided for in regard to the level of cereals prices, which the Commission had proposed should be reduced by 3.6 per cent. In the case of milk I have made it absolutely clear that the commitment made by the Council last year on Ireland's quota level must be honoured. I do not propose to go further into details on the various product sectors. To do so could be counter-productive at the present delicate stage of negotiations, and I am sure that Deputies will appreciate how necessary it is not to prejudice the eventual outcome.

It is disappointing that the Council has not yet reached a settlement. I will be stressing once more at the next Council meeting the necessity of concluding the prices agreement without further delay. It is only natural that farmers and their organisations should be greatly concerned about this aspect. Nobody, however, would wish to settle for an unsatisfactory agreement simply to gain time. On the contrary, it is essential to have a settlement which is acceptable and fair. Delays are, of course, a frequent occurrence in the fixing of agricultural prices. In the past eight years prices have been agreed on time, that is before the end of March, on only three occasions. The average time is probably the middle of May, although sometimes it went into June.

To deal with the Estimate itself, the gross sum is £394 million, which is about £32 million or 9 per cent above the amount spent in 1984. However, a rise of about £28 million is projected for receipts, resulting in a net estimate increase of some £4 million over 1984. The rise in gross expenditure results mainly from increases under disease eradication, exchange rate guarantee, farm modernisation and market intervention offset by decreases for pay, calved heifer grants, food subsidies and EEC special measures. The increased receipts arise mainly from EC contributions in respect of farm modernisation and market intervention and also from the disease levies and veterinary inspection fees.

Of course, the gross estimate of £394 million represents only part of the much larger total amount expended by my Department. For 1984 this overall sum amounted to over £1,400 million, including some £700 million of expenditure fully financed by the EC in respect of agricultural support measures and about £350 million borrowed by my Department for intervention purchases of beef, butter, skimmed milk powder and cereals. These large amounts of EC-related expenditure provided very substantial benefit to the agricultural industry and the expectation is that this type of expenditure will be at roughly the same level in 1985.

I should now like to deal with some of the main agricultural products.

Last year was a satisfactory one for the cattle and beef industry. Cattle output increased by 3 per cent in volume terms and by 7 per cent in value terms. Exports of cattle and beef and their by-products amounted to almost £650 million, accounting for 40 per cent of our agricultural exports. For the first time since 1980 throughput at export plants exceeded 1 million head. Total slaughterings were in fact over 1.12 million, representing an increase of 15 per cent on 1983. This increase was achieved without any depletion of stocks.

More than any other element in the agricultural sector, beef is an export-oriented industry. Even though 1984 was a difficult year on international markets for the beef sector exports of beef in processed form increased by 30 per cent over the 1983 level, with a significant increase of 45 per cent in exports of vacuum packed beef. The export promotion work of CBF was of importance in these export developments.

By and large Irish producers got good prices for their cattle in 1984. Indeed for a time the Irish reference price exceeded the overall EEC average — the first time that has happened since our accession to the Community. Steer prices were quite strong. This was particularly so early in 1984 when the market was affected by heavy buying by Northern Ireland factories which at that stage enjoyed the benefit of the variable premium without any clawback on exports. Steer prices again rose sharply from November onwards because of the influence of a highly successful scheme of private storage aids.

In response to pressure by me a clawback of the UK variable premium on exports was introduced last May as part of the prices package in Brussels. This removed an anomaly which had threatened to undermine completely the competitive position of our meat factories. Northern factories had been enjoying, in effect, a subsidy on their exports and this made it impossible for our factories to compete for cattle. The people in the trade, particularly the processors, appreciate what was done at last year's price package in the beef sector. The introduction of the clawback on British beef being exported has had a very significant effect on our beef trade. It has helped not just producers but the level of employment.

I succeeded in getting the institutions of the Community to recognise the inequity of this situation and to introduce changes to restrict the operation of the premium to where it belongs, that is to beef consumed on the UK market. We have no objection to the British Government operating a variable premium within the UK. However we have an objection to their using it to subsidise exports. Thankfully that anomaly has been removed. The effect of the change was immediately apparent. As I have already said our factories achieved a throughput of over 1.12 million head in 1984 and this occurred despite the fact that the clawback was not fully operational until July.

A serious market situation arose in most member states of the Community in mid-1984. Heavy slaughterings of cows, the inevitable consequences of the milk super-levy, threatened to flood the market with beef and to depress prices to a disastrous level. A million cows over and above normal cullings were slaughtered, putting about a quarter of a million extra tonnes of beef on to an already over-supplied market. The Commission responded with a package of measures which were more imaginative and more successful in achieving their short-term aims than anything else done for the beef sector in recent years. First, export refunds on female cattle and on beef from female cattle were increased, thereby encouraging the export to third countries of some of the surplus cow beef. Secondly, intervention was made more flexible so that it was supporting whatever types were perceived by the trade to need it most from week to week. Finally, there was a new scheme of private storage aids, with a distinct bias towards exports of prime beef. This was extremely successful. In fact, it took 72,000 tonnes of beef or about a quarter of a million cattle off the market here in Ireland. In consequence of these measures Irish producers received good prices for their cattle throughout the autumn and exceptionally good prices in the November to January period.

I have described these developments because of some suggestions of an alleged cattle "crisis" in the spring of this year and of the ruin facing winter feeders of cattle as a result. Deputy Leonard raised this at Question Time recently. Prices undoubtedly fell between mid-January and mid-March, but it is important to understand the background. A number of factors seem to have fuelled unrealistic price expectations. To begin with, there were some suggestions that prices would rise to 120 pence a pound; these certainly did not originate in my Department. Second, producers may have been basing their expectations on invalid comparisons with two other periods — the spring of 1984 when prices were distorted by the absence of a variable premium clawback and the two months up to mid-January 1985 when factories were paying very high prices for scarce cattle to fill their profitable private storage contracts. It seems to me that a more orderly approach to marketing, selling cattle as they became ready, even on a gradually falling market, might have left many producers better off than they were after having held on too long.

I recognised, however, that prices had fallen significantly and that many producers had held on to their cattle in the hope of a price improvement. Accordingly, I pressed the Commission to introduce corrective measures. With Community intervention stocks heading towards a million tonnes, the Commission were simply not prepared to countenance carcase intervention but I did achieve two valuable improvements. The first was an increase in the level of live export refunds; this was designed to stimulate competition between factories and cattle shippers. The second was a new private storage scheme, which will take the equivalent of 45,000 steers off the market between mid-April and the end of May. Prices have responded to these aids and are now well off the bottom level. I hope that the switch to the purchase of fore-quarters into intervention next week will continue this trend.

A word of warning before I leave this point. No more than any of my predecessors as Minister for Agriculture, I am not in the business of making market price predictions. However, special situations should not create expectations which may be disappointed. A person who buys store cattle in the autumn must carry at least some of the blame himself if market conditions in the spring fail to match up to an unduly optimistic assessment.

This year's price negotiations seem likely to result in no great price change in the beef sector. The second stage of the price harmonisation under the classification grid should, however, provide a support price increase of about 1 per cent.

The unilateral action by Canada last December in imposing a tiny quota on beef imports from the Community was a severe blow to some of our major exporters. Canada has developed into a very useful outlet for cow beef and we could not accept that this outlet should be almost completely closed. The matter has been the subject of bilateral negotiations between the Commission and the Canadian authorities and after these had dragged on for several months and the Community had threatened to retaliate, Canada has now agreed to a quota of some 10,600 tonnes from the EC for 1985. It is no coincidence that the Taoiseach happened to be visiting the Canadian capital and meeting the Canadian Prime Minister during the week. The Commission and Canada are today discussing the details of the new quota arrangements and the Commission will have to ensure that they do not contain any unacceptable conditions. While the quantity now agreed upon is considerably better than the 2,700 tonnes originally imposed by Canada it is regrettable that our exports to Canada will in future be subject to continuing restriction.

The various measures for the improvement of the genetic merit of our livestock were continued during the year. Imports of high quality Friesian bulls and semen of proven bulls were arranged and additionally an expanded programme of progeny testing of beef and dairy bulls was carried out. Also I decided that herdowners who wished to operate do-it-yourself artificial insemination within their own herds should be allowed to do so. Only a small number of herdowners are likely to avail of DIYAI but the system has advantages of cost and convenience and I do not think that progressive farmers should be denied any opportunities to maximise efficiency, especially in the present economic climate.

Following the discontinuation of bull licensing in 1983 concern was expressed about likely adverse effects on the quality of the national herd and on our export trade. Following a report from the Cattle Advisory Committee the Control of Bulls for Breeding Bill was introduced and is currently before the House.

The Canadian Government were concerned at the export of our cow beef which dramatically increased over a period of a few years and they reacted in the manner I have just described. It is unfortunate that these restrictions have been imposed but they give our factories an opportunity to fill orders. If we did not have the increased amount there would be serious financial difficulties for a number of factories. There is a general feeling of relief that we got a reasonable compromise.

The level of milk recording in Ireland has been very low by international standards. I am glad to say that this situation is changing, particularly since the setting up of the Irish Dairy Records Co-operative which is representative of creamery co-operatives, milk boards and AI bodies. I am providing £400,000 under Subhead C1 to help to finance the reorganisation of the milk recording service. I am confident that the co-operative will continue to expand milk recording in the years ahead.

Last year my Department imported a number of top class Suffolk, Blackface Mountain and Newtown Stewart rams for leasing to selected breeders of high quality flocks under the leased ram scheme. This scheme enables pedigree breeders to improve the genetic potential of their flocks, and this improvement in turn is transmitted to commercial flocks. Further importations are planned for this year. Genetic improvement of the pedigree pig breeding herd continued under the accredited pig herd scheme. Also a number of high quality pedigree boars were imported by the Department for leasing to breeders participating in the scheme.

In the Supplementary Estimate, I am providing an additional £100,000 under Subhead C.1 in respect of livestock improvement measures. This money will be used in three ways. First, it will ensure the full utilisation of the expanded beef progeny and performance testing facilities, in particular the Tully performance testing unit. Second, it will provide increased grants to the AI centres for the testing of a greater number of dairy bulls for economically important traits such as milk yield and composition, beefing merit and ease of calving. Third, more Blueface and Border Leicester rams will be imported to expand the hill cross ewe project this year. The purpose of this project is to organise the systematic provision of more prolific ewes for lowland sheep producers. The productivity of our lowland ewes is below that of lowland sheep in Britain. By crossing Blackface Mountain ewes with the Leicester rams the resultant female progeny will have greater productivity as breeding ewes. The project, which is now in its second year, has been organised in the major hill areas but its extension to other areas is planned for this year.

Those who visited the Spring Show this week will have seen the wonderful work done in this area, not just by the Department of Agriculture but by ACOT and An Foras Talúntais. They graphically illustrated what needs to be done and their comparison of the type of lamb carcase required for the French market with that which is not required was a very worthwhile exercise. I hope that type of demonstration can be extended to the pig sector in future years as it would be highly informative.

As regards milk, deliveries to creameries in 1984 showed an increase of 5 per cent and set a new record level at 1,075 million gallons. The super-levy system has now been in operation for over 12 months. Inevitably, there have been teething problems in operating the scheme in the different member states and some changes were introduced earlier this year to facilitate the administration of the system. The most useful of these amendments for Ireland was the provision enabling regional transfers for 1984-85. This flexibility has the effect of significantly reducing our super-levy bill. Some purchasers have yet to furnish final returns of their intake for the final quarter of 1984-85 but it appears that the super-levy bill will be a good deal less than had been predicted recently. I hope that the inter-regional transfer, to which I referred, will be continued this year and it is one of the items under discussion in Luxembourg and Brussels.

Last year ad hoc arrangements were made to deal with the special needs of new entrants and farmers in financial difficulty. We now have in operation the milk cessation scheme which facilitates the reallocation of quotas to producers affected by animal disease and other special categories. I am at present considering possible further measures for the allocation of additional quotas to these producers on a permanent basis. I am quite happy with the progress made in recent weeks to cater for other groups with particular difficulties such as financial problems and difficulties for new entrants. I compliment the farming organisations and the umbrella organisation of the co-operatives, ICOS, for their general co-operation. It has not been easy. Someone will have to pay for the extra milk but they have shown a willingness to get to grips with the problem and we will be in a position to announce details of a scheme in the near future which will look after people with genuine problems in regard to disease, new entrants and people in financial difficulties.

Obviously under the quota system, any reallocation has to come from the quotas of other suppliers. This can be done on a compulsory basis or by way of a voluntary purchase scheme under which released quotas are made available on a definite basis to producers in the special category classes. I hope that there will be no hic-coughs in regard to the voluntary scheme. Discussions are in progress with representatives of the farming and co-operative organisations on the possibility of setting up a further purchase scheme. Good progress has been made on this issue and subject to clearance of the details with the EC Commission I hope to make an announcement in the matter shortly.

The current situation on international dairy markets is far from encouraging. The reduction in milk deliveries achieved in the Community and in the US has been largely offset by increases elsewhere and the slow rate of the economic recovery has resulted in market demand remaining weak. This has led to even greater competition among exporters and as a result we have seen a gradual erosion of the discipline which has previously operated in respect of international market management. As our industry is so export-oriented, the difficulties I have outlined have manifested themselves in reduced exports and consequent increased selling to intervention.

On the other hand, there are some positive aspects. Subsidised internal disposal measures have reduced Community intervention stocks of skimmed milk powder to manageable proportions. These stocks have in fact been reduced from a peak of just under a million tonnes in July last to less than 400,000 tonnes currently. Here in Ireland intervention stocks have been reduced to some 400 tonnes, the lowest level since 1980. The position as regards butter is in sharp contrast. There has been no improvement in the butter stock situation over the past 12 months despite the reduction in Community milk deliveries and a sale of a substantial quantity of butter to the USSR. In Ireland 40,000 tonnes of butter were taken into intervention in 1984, and a heavy level of intake is anticipated again during 1985. Community butter stocks are now approaching the one million tonne mark. In the course of the current round of price discussions I have pressed for the introduction of more effective internal disposal measures. I think that there is now general agreement that the problems in the butter sector are sufficiently deep-rooted to warrant urgent action, and I am hopeful that a degree of stability can be restored to the market during the year.

The detailed implementation of the super-levy quota system has involved considerable time and attention from those connected with the industry. Apart from the detailed operational arrangements, there are other aspects arising from the quota system which require perhaps even greater attention. In last year's price negotiations, the special position of dairying in the Irish economy was recognised by our EC partners and a satisfactory outcome was secured. We must make the most of the opportunity that has been given to us. In particular, this entails the production of quality milk in the most cost effective and efficient way possible. While the quota system has imposed quantitative constraints on production the vast bulk of dairy farmers can improve their incomes by more efficient husbandry and management. No one can deny that there is plenty of scope for better breeding, better calving patterns and better milk quality at farm level. For the individual dairy farmer the level of his income will be largely determined by the efficiency with which he fills his quota.

At processing level the task is possibly even more daunting. Our industry has become too dependent on the production of commodity type products for which the intervention store is too often the only outlet. This has to change, and in fairness I recognise that those involved in the industry fully accept this. What is required is a fairly fundamental alteration in product mix and in marketing strategies. The consumer market for dairy products has evolved considerably over the past few years. It is now a highly fickle and sophisticated market; it is also highly competitive. The task is to diversify sufficiently so that we are in a position to react to new market demands and opportunities and, at the same time, leave ourselves less exposed to the vagaries of the intervention system and to changes in Community arrangements. Such a policy will require time and money and I am glad to see that the industry is beginning to respond through the Bord Bainne market development fund. Penetration of markets for branded products can only be achieved on the basis of consistency, reliability and quality and those engaged in processing will have to adopt a ruthless attitude as regards quality in the future.

As I said at Question Time, I am gratified to see that the dairies and co-ops are making a very determined effort to provide a greater range of products. At the Spring Show this week the displays by the various firms indicated that clearly. The message has got through and people are making a very determined attempt to move away from butter and skim milk powder and get into areas where value-added content is extremely important. As a result prices are also considerably greater. I do not agree with Deputy O'Keeffe who criticised the efforts being made. As far as I am concerned the efforts were quite outstanding.

There is no doubt that dairying continues to be one of the most attractive farm enterprises. The demand for quotas under the super-levy system is more than ample proof of that. The dairy sector has now entered a new phase in its development. It reacted well to the opportunities presented by EC membership, achieving a rate of unparallelled growth during the 1970's. The growing imbalance between declining demand and rising production changed the environment. One may regret that more was not achieved during the expansionary days. The possibilities of increasing production may at times have deflected attention from some inherent deficiencies but I think the industry has a clear appreciation of what it needs to do now to cope with the new situation.

The Government's commitment towards making our dairy and food industry generally more responsive to consumer demand has already been clearly indicated in the national plan. Our policy is to create the environment of confidence where investment and expansion can be undertaken and we are making tangible progress in this regard.

A major provision in the Estimate is that of £31.5 million under subhead E for the consumer subsidies on milk and butter. This provision is £15.8 million less than spent in 1984 and is due to the operation in 1985 of the reduced levels of subsidies fixed in July last. The present rates of subsidy are about 2p per pint on milk in the Dublin area and 2.5p per pint elsewhere and 15p per lb on butter. These subsidies reduce the price of milk by some 10 per cent and that of butter by about 15 per cent.

In so far as sheepmeat is concerned, slaughterings at meat export factories in 1984 showed an increase of 11 per cent on 1983 and are running higher again in the current year. There is now a welcome awareness on the part of farmers of the attractiveness of sheep production vis-á-vis other forms of farm enterprise. In fact, the estimated net margins for mid-season lamb production in 1984 were 120 per cent above those for cattle and 60 per cent higher than for barley.

The sheepmeat sector is experiencing some market difficulties in France arising from the export to that market of British ewemeat at low prices. This practice has resulted in a situation where cheap British ewemeat accounts for one-third of total French imports of sheepmeat. I have being objecting to this trade distortion at the Council of Ministers meetings and I will continue to press for an end to the present unsatisfactory situation.

I cannot over-emphasise the necessity for producers and exporters to gear their breeding, management and marketing practices to the exacting requirements of the continental markets. In the years ahead producers may no longer be able to rely as heavily on the EC mechanisms for income support and may have to get the lion's share of their returns directly from the marketplace.

My Department will do all in their power to assist producers in the production of better quality leaner carcases with good conformation. I am hopeful that we can proceed with the early introduction of a lamb carcase classification scheme, possibly on a trial basis. However, any such scheme will only be successful if it has the full support of factories and producers and if it is accompanied by adequate price differentials whereby good quality lean lamb is rewarded and poor quality fat carcases are penalised. In addition, there must be a clear commitment from the factories that carcases certified as unsuitable will not be sent to quality wholesale markets such as Paris.

The pig industry had a difficult year in 1984. Prices were under pressure and slaughterings declined. To help alleviate some of the problems facing the sector we have been seeking over the past year the fullest support of the EC market mechanisms. Thus export refunds on pigmeat going to our main third country markets have been maintained at relatively attractive levels. Moreover, a new scheme of aids for private storage came into operation this week and I am hopeful that it will help towards improving the depressed market situation.

There is an urgent need for investment to improve efficiency at factory level. To compete effectively on the home and export markets our factories premises must be up to the highest standards possible. On the home market, we may face increased competition from other member states when the health restrictions on imports of pigmeat are lifted. These challenges can best be met through further rationalisation and modernisation of factories. My Department and the IDA are ready to give every assistance to help to achieve this aim. Considerable investment has in fact already been made with the support of both national and EC funds and further investment projects are planned.

The most important element of our investment policy is the centralisation of slaughtering units. What is required is about ten centralised slaughtering plants throughout the country providing raw material supplies to processors. Each should be capable of slaughtering about 6,000 pigs per week, thereby maximising economies of scale. A particular advantage of the centralised units would be that they would meet the veterinary requirements of the major importing countries, thereby enabling the maintenance and improvement of exports.

Yesterday at Question Time people were concerned that we did not have a share of the valuable American pigmeat market. None of our plants is licensed to export to the USA because the standards at the plants are not up to scratch. When I speak about ten centralised plants killing 6,000 pigs a week there is nothing dogmatic about that. That is the ideal the IDA have set and that is what the people organising the industry would like to see. There can be variation from district to district depending on the amount of pigs available. It is a guideline and not gospel.

The Government agreed sometime ago to the introduction of legislation which would provide for health inspection charges and standards at local pork slaughtering premises that would be on a par with those applicable at licensed export factories. That legislation is in course of preparation and it will aim to eliminate the divergence of standards which at present applies between the two types of premises.

There was a question yesterday about the standard of premises. It is very difficult to amend legislation when you realise that some of it dates back as far as 1847. Some of the legislation governing the operation of meat plants is almost 140 years old. Amending a whole series of different types of legislation is tedious and long drawn out. It is not as simple as people might imagine.

I am glad to say that 1984 was a good year for the poultry industry. In the broiler sector production increased by some 5 per cent. Imports from Northern Ireland remained at their 1983 level, giving scope to our plants to increase their share of the domestic market. For the future we must continue to maintain the high standards of the industry and further develop the range of processed products to be marketed.

In the case of turkeys production in 1984 was steady but a welcome feature is that an ever-increasing percentage of the throughput is going for further processing. Over 30 per cent is in fact now being processed. The significant strides taken by the turkey sector in market and product research and development are indeed very encouraging.

In the egg sector returns to producers were helped by stable input costs, particularly feedingstuffs. The scheme of grants for egg packing stations has been quite successful in helping the packing and marketing of eggs.

The area under grain in 1984 was around 400,000 hectares or about 3 per cent higher than in 1983. Largely because of the excellent growing and harvesting conditions, total production showed an increase of around 27 per cent. The 2.3 million tonnes of grain produced was about 7 per cent up on the highest figure previously recorded. In recent years the area under spring wheat has been steady at around 14,000 hectares, but the winter wheat acreage has almost doubled to about 65,000 hectares. The area under spring barley, still by far the main cereal crop, is tending to decline with the increase in the winter wheat acreage.

In the current marketing year grain prices have been well below the support price levels and, as a result, my Department have taken some 19,000 tonnes of feed wheat and 106,000 tonnes of barley into intervention. To date practically all of the wheat and 28,000 tonnes of the barley have been sold.

As is known, the Commission's farm price proposals for the 1985-86 marketing year included a reduction of 3.6 per cent in the price for cereals. This arises from the application of the principle of co-responsibility first agreed by the Council of Ministers in 1981. In the price negotiations I have opposed this reduction and I believe that a better result will be achieved.

For the past few years the flourmilling industry has been experiencing difficulty in competing with lower priced imported flour. Imports have risen from 9 per cent of our annual requirements in 1982 to 20 per cent in 1984 — virtually all the imports being from the UK. Under EC rules there is free trade in flour between member states and the imposition of restrictions on imports is not permitted. This causes a problem for our flourmilling industry.

The question of possible abuse of a dominant position by UK exporters was raised with the EC Commission but that body did not accept that the trading practices being followed by those exporters are contrary to the provisions of the Treaty of Rome. I again appeal to all concerned — especially consumers, retailers and bakers — to bear in mind the importance of a national flourmilling industry to our economy and the consequences for the economy and for employment generally should the use of imported flour continue to increase.

Over 221,000 tonnes of sugar were produced during the 1984-85 campaign. This level of production enabled us to fill both our A and B quotas and will stand to our advantage when the negotiations for the post-1986 quota arrangements begin later this year.

The total provision under subheads C.2, C.3 and C.5 for the disease eradication programme in 1985 amounts to £31.5 million. This compares with expenditure of £22 million last year. As the House is aware, there has been virtually no progress for several years past in reducing the bovine TB infection level. This situation clearly pointed to the need for a fresh approach if we were ever to get rid of this disease. As indicated in the national plan, the Government recognised the gravity of the situation and decided to initiate a fresh onslaught on bovine disease, and on TB in particular. To this end, very substantial funds have been set aside for disease eradication during the period 1985-87. This funding was conditional on the introduction of a number of basic changes in existing procedures, the main ones being the nomination by my Department, rather than by the herdowner, of the veterinary surgeon to carry out the test, and the payment of the fee direct to the testing veterinarian.

At first the Irish Veterinary Union found themselves unable to accept these changes but, following prolonged and intensive discussions between the two sides, the way has now been cleared to enable the 1985 testing programme to get under way. There is plenty of work for all concerned, and the thing now is to get on with the job.

While the increased financial allocation and the new approach provide a basis for real progress in the eradication drive, the total co-operation and commitment of all parties is essential to success. This will call for greater discipline on the part of everybody concerned — the veterinary profession, farmers, and my own Department.

I want to make it clear right now that the days of the casual approach to the TB problem are over. For the future, I shall be looking for an improved performance from all sides, increased attention to detail and the type of positive involvement and commitment that has not always been in evidence in the past. I also want to make it quite clear that I shall be as demanding of my own staff as I shall be of farmers and veterinary practitioners.

I want to compliment the officials of my Department who have worked very hard to resolve the dispute which existed over a number of months. I also want to compliment the President of the Irish Veterinary Union, Mr. Coffey, on his efforts to settle the dispute. I am glad to say the result has been satisfactory. Commonsense prevailed and there has been no loss of goodwill. The outcome has been highly satisfactory from everybody's point of view. This will lead to a really successful onslaught on the incidence of TB in cattle. Recently I announced increases in the reactor grants for lighter cattle as well as improvements in the terms of the depopulation fund. Bovine TB is particularly difficult to eradicate here because of the large scale movements of cattle. On average cattle are moved five or six times in their lifetime, whereas in other countries they move once on average.

I have made no mention until now of brucellosis. The position in this regard is most satisfactory, and there is the very real prospect that we will see the last of this disease within a few short years.

In the national plan, the Government announced the doubling of the bovine disease levies from mid-November 1984 to the end of 1985. Receipts of £13.7 million are expected from the levies this year. I have pointed out before that this levy will be reduced to half at the end of 1985. It will operate at half the level from then on.

I am providing a total of £18.4 million for ACOT under subheads B. 12 and B. 13. Restructuring of the advisory services has recently been effected. This involved the devolution of management to district level where local advisory teams are operating on a client/enterprise basis. This has geared ACOT for the expansionary and development role envisaged for the advisory service in the national plan.

ACOT are working exceptionally well. Since the advent of their new organisation system, there has been a wonderful improvement. The director of the organisation is doing an excellent job. Their training programme is tremendous. It may not be recognised generally that this programme will have enormous implications for Irish agriculture. It is very encouraging the virtually 90 per cent of young people embarking on farming nowadays are being trained by way of ACOT courses. Currently, 3,000 farmers are engaged in comprehensive courses extending over three years while a further 1,200 are expected to join the courses in the autumn. In addition short courses to establish farmers have been set up and last year these courses attracted 4,500 participants, an increase of more than 80 per cent on the level of each of the two previous years. That figure speaks for itself.

Under subhead B.3 almost £16.1 million is being provided for An Foras Talúntais. This body too, are doing very valuable work. In the national plan we recognise the important role they have to play.

A provision of £208,000 is provided under subhead B.5 for county committees of agriculture. This represents a considerable increase, almost 40 per cent, on the amount provided previously under this heading. Under subhead B.1 a grant of just under £10 million is being provided for grants to university colleges.

I wish to refer to a few specific items before dealing with the farm modernisation scheme. In the House on Wednesday, Deputy Walsh inquired about the 1924 Dairy Act and asked why the Act was not being implemented fully by my Department. As I pointed out then, the Act is hopelessly out of date and I am not happy with the present position. A group in the Department of Agriculture, in consultation with the Irish Dairy Council, have been studying the matter for some time past. We are concerned that the Act should be updated because we are aware that some milk purchasers are not complying with the legislation and we cannot condone that type of activity. The maximum penalites for breaches of the 1924 Act are as low as £10 and £20. Therefore, the Act is relatively ineffective. It is my intention to update the legislation so as to ensure that the penalites are sufficient to deter people from operating in a manner which is not conducive to the best interests of the dairy industry. It must be said that farmers have a duty to settle their trading arrangements with their co-operatives. It should not be necessary to have to harp all the time on the legislation concerned but the farmers and their organisations should insist that payment for milk is based on proper standards, that an adequate price is paid for a higher level of protein or butter fat content. The legislation does not help much in preventing the application of a flat rate price and consequently we must amend it and bring the penalties up to a more realistic level if we are to ensure better prices for protein and butter fat content.

Another matter that is very topical is the question of the rescue package, the scheme to aid farmers who are in financial difficulty and which was introduced three years ago. I am being asked constantly if this rescue package will be continued. While I should very much like to be able to have the scheme continued I have pointed out to the farming organisations that farmers who are still in financial difficulty should continue to be given some assistance. It is my intention to bring such a scheme to the Government, that is, after I have been appraised fully of the exact position.

However, I wish to make one point clear. Some time ago an ACOT survey indicated that approximately 50 per cent of people who benefited from the scheme in the past three years have now attained financial viability. I am insistent that people who have reached viability should not continue to benefit from subsidies from the Exchequer. I do not know what is the proportion of farmers who are in the red but I expect there may be as many as three out of four and it would be hardly fair to subsidise people whose financial affairs are in a healthy state and not to assist others who are experiencing difficulty. Therefore, I have made it clear to financial institutions that those people who have overcome their difficulties and are now viable financially be identified so that they are not included in a further scheme. I should dearly like to be able to assist people who are in continuing difficulty and in the coming weeks I shall be working towards a solution to that problem. I have had nothing but goodwill and assistance from the institutions concerned.

I wish to deal also with a recent report concerning the deaths of greyhounds on a ferry between Ireland and Britain. It has been stated that we have shown little or no regard in so far as this incident is concerned. I am referring to this matter since I have responsibility for the greyhound industry as well as for the race-horse industry. On Tuesday night last on a Sealink ferry travelling between Rosslare and Fishguard 14 greyhounds died. Apparently 21 animals were shipped in a kennel within a truck when the kennel was adequate only for 12 dogs. When I noticed the report I asked my Department immediately to investigate it. It is disgraceful that such an incident could have happened. Our Transit of Greyhounds Order, 1924, stipulates that there should be one kennel for each greyhound in transit. The matter will be investigated thoroughly in order to ascertain in what way the law was broken and by whom. If the responsibility is found to lie on this side of the Channel or on anyone operating from this country, I will be pressing for action to ensure that those responsible are prosecuted. We will not tolerate any recurrence of that type of activity. Cruelty to animals is not acceptable.

Dún Laoghaire): By agreement, the speech of each Member today, with the exception of the Minister for Agriculture and of the Fianna Fáil spokesman on Agriculture, shall not exceed 20 minutes.

The Members will have read that the Government yesterday decided that a Bill will be brought in to deal with the very severe problem of stray dogs. I would not like to give the impression that this legislation will be produced overnight, but I promise that it will be done as expeditiously as possible. The scheme, which is being sponsored by my Department, will be operated by the local authority who have the infrastructure to deal most efficiently with it. We shall give every assistance. This has been done in a few countries. The Department of the Environment will provide the dog shelters, the wardens and the equipment necessary. It is absolutely vital that this be done because of the cruelty that arises, particularly with regard to sheep and lambs.

Hear, hear.

These animals are harassed, killed or maimed by these uncontrolled marauding dogs who generally emanate from the urban areas. It is a considerable problem. Many of these are family pets which are left out, not just stray dogs. We must get the situation under control.

Lately, I came across an extraordinary statistic. It is an estimate, I might point out, that there are something like 700,000 dogs in this country. Only about 110,000 to 115,000 of these are licensed. This is unacceptable. It is only correct that the onus for implementation will shift from the Garda Síochána to dog wardens, because the Garda Síochána have enough to deal with at present in terms of serious crime. I hope, with a proper scheme of dog wardens and dog shelters, that this will be self-financing. However, that is a lesser consideration. The important one is that we should get rid of the menace of dogs attacking animals — and human beings, for that matter. We must always keep in the back of our minds the real danger that rabies might reach our shores. That would create an extremely difficult problem for us, because of the number of animals roaming loose without any supervision, whether they be stray animals or pets not kept under control. We could have a major problem and must be extremely aware that measures must be taken. The legislation will be fairly detailed and will not be finished in a short time, but at last we have the go ahead to do it.

I wish to refer to the farm modernisation scheme. This was introduced in 1974 and grants paid to date to farmers amount to £270 million. As you know, the EC directive on which this scheme was based is due to expire next September but, as I pointed out recently to the House, we hope to bring in our new scheme by 1 October.

The Minister of State, Deputy Connaughton, will deal in greater detail with western development. Six million pounds is provided under subhead M.1 for a programme of western development. This is better known as the western package. We are reviewing the whole operation of this package to see if we can make it more effective. The uptake has not been as great as we anticipated. A sum of £9 million has been provided for the western drainage system under subhead M.1 and a colossal amount of land has been drained under this scheme. We have provided in the national plan for additional money for this very worthwhile activity.

I shall not dwell on the increase in the grant amounts in the national plan for beef cows from £32 to £70 in disadvantaged areas. That was stated previously in the House. This will give a tremendous boost to herd owners in those areas. We have also announced a disadvantaged area scheme which we discussed here yesterday. This means that now 68 per cent of the county is in the disadvantaged area category.

Minister of State, Deputy Connaughton, will deal with the provisions for the Land Commission. This commission have done a very good job. Their work, for all practical purposes, has been coming to an end for the past five or six years. As you know, the Government decided to wind up the Land Commission, although some of the important aspects of their activities, not including land acquisition, will be retained. The Minister of State will also deal with that in some detail.

I am glad to say that we have increased the off-farm income considerably, enabling many people to qualify for headage payments. That will be particularly welcome. These people work very hard on relatively low wages and deserve some form of recognition. I was disappointed when a representative of a farming organisation recently was most aggressive about this and said that we should have left it as it was. It has meant, of course, that the headage and premium payments have been reduced by £1 a head. However, that is a small price to pay for including many decent, hardworking people, such as forestry workers and county council road workers. Those people are entitled to some assistance when they show the initiative of holding down two jobs. This is a recognition of their hard work and industry.

I come to the horticultural industry. This sector has been worth £71 million at the farm gate in 1984, which is a tremendous amount of money. We are giving aids and grants to assist glasshouse growers, for those converting from oil to solid heating. The amount being provided under subhead D.7 is £300,000. Minister of State, Deputy Hegarty, will be dealing with that matter in greater detail. We have done a considerable amount to help in the setting up of co-operatives of potato growers, vegetable growers and now for people who have glasshouses, to make them more competitive. I think that is appreciated in the horticultural sector.

My statement covers the remaining items, which are quite technical. I have no intention of detaining the House any further. I confidently recommend both Estimates to the House for adoption. I am sure that we shall have a constructive and fruitful debate on their contents.

(Limerick West): This is a very limited debate and I know that a number of Members wish to make contributions, so I shall be brief. Many of my colleagues will cover aspects which I do not cover. The mountains of figures that make up these Estimates for Agriculture are mere accountancy. Looking through them and the policies which they reveal is gravely worrying for anyone with an interest in the industry.

The Minister has my sympathy. In my opinion, and this is shared by many others, it is quite obvious he is not the master of his own Department's destiny. Otherwise he could not have gone along with some of the repressive measures he now finds himself compelled to implement. It is obvious the Minister is being controlled or is being shouted down at the Cabinet table by some of the Thatcherite approaches led by a certain clique in the Cabinet, and more particularly by the Minister for Finance. There can be no other logical explanation for withdrawing £200 million from agriculture since Deputy Deasy became Minister or for continuing the series of cutbacks in any sphere of that industry. Irrespective of whether it appeals to the Donnybrook set that dominates this Labour-Fine Gael Cabinet, the fact remains that agriculture is our single most important industry. It utilises our natural resources, it has mainly native inputs, it employs nearly half our working population either directly or indirectly and it contributes nearly one-quarter of our total export earnings.

The revival of our economy will happen only when agriculture is strong, healthy and vibrant. The potential of the industry in terms of investment, jobs and exports has merely been tapped. It needs leadership and encouragement from the Government before that potential can be realised. It is a measure of this Government's priorities that money is made freely available to foreign high tech industry to set up here while, at the same time, agriculture is slowly being starved of investment. I am not necessarily against investment in high tech industry from abroad but I emphasise that the Government have their priorities wrong. Jobs in agriculture and in the agri-food industries are real jobs that will be there long after the jobs in high tech industry have vanished to more fashionable locations.

It is at times like this that the national interest calls for a real increase in investment in agriculture, not for a reduction of £200 million in investment. As has been proved during the years, agriculture is capable of repaying that investment and this is something I wish to emphasise to the Minister and to the Government. Money spent on agriculture will repay itself over and over again by way of much needed employment and much needed capital investment in the economy.

Investment in the industry will also mean there will be a major spin-off. A classic example is the beef cow herd which is currently at a record low number of 400,000 from the previous level of 700,000. Beef is one of our most consistent export earners and the recent inroads of CBF into the valuable "Vacpak" markets in Britain and elsewhere have shown the importance of this sector. Yet, in the Estimate before us, under subhead D.2 there is a reduction of some 58 per cent in the provision for the expansion of the cattle breeding herd. I hope the Minister can explain this incredible reduction because if it means what it appears to mean the beef cow herd numbers will be further decimated in 1985 and the consequences of that will be felt in the farms and in the factories. There should be no reduction in this vital area. Already the grant level is inadequate as an incentive.

The Minister must realise that money spent by him on the beef sector will repay itself in a short time. The proposals in the Government's programme Building on Reality of giving incentives in 1986 is like closing the door after the horse has bolted. Why not introduce the proposals this year so that the beef cow numbers can be increased and thus provide worthwhile benefits to the economy? There is little point in trying to redeem the industry when all is lost.

The Minister should also consider the real possibility of beef reduction being artificially limited by the EC in the same way as milk production is limited. If such limits were imposed now we would have to accept a very low threshold but with our beef herd numbers at their former level we would be in a far stronger position in this connection. This is something the Minister and the Government should consider very carefully.

The limits on production set by the EC and the attitude in Brussels to prices have put a premium on education and research. At a time when the emphasis must be on efficiency if farmers are even to maintain their existing level of income, research and advice are crucial. Yet, the Minister has seen fit to reduce investment in education and training. The grant-in-aid to ACOT is down by 3 per cent and, while An Foras Talúntais have been given a token 1 per cent increase, this benefit will be eroded by the rise in the cost of living.

This petty approach to education and research is in direct contrast to the approach of our European partners whose assistance in these areas continues to grow. Organisations such as ACOT and AFT represent the greatest hope for the future of the industry. However, judging by his actions and what has happened in this Estimate, the Minister does not seem to hold ACOT or AFT in very high regard, notwithstanding what he said previously about their progress. I am most concerned that he will not allow the report of the Cashman Committee, when finally submitted, to be used as an excuse to reduce support further in these vital areas at a time it was never more needed. ACOT have more than proved their worth. Their restructured services have enabled them to cope with a major growth in training and educational activities while imparting expert advice to our farmers.

Two major developments in recent years have demonstrated just how valuable ACOT is in the structure of agriculture here. Following the introduction of milk quotas last year ACOT undertook a major analysis of alternative pathways to farm development in the new post-super-levy environment. A detailed advisory case book has been prepared to assist advisers in guiding farmers toward the best enterprises or a mix thereof. At present they are closely examining each enterprise to ascertain how it can provide the most effective service to all farmers taking into account market and development constraints.

I am indeed disappointed at the suggestion contained in the Government's plan Building on Reality that the time might now be opportune for ACOT to charge farmers for advice given them. If this practice is encouraged and implemented it will mean that their services will then be provided only to farmers who can afford them. That would be a sad day for Irish agriculture and more particularly for our small farmers who form the back-bone of our agricultural economy. I warn the Minister and his Department to move away from that type of thinking because it would deter ACOT generally from giving a worthwhile service to all our farmers.

ACOT have been playing a major role with regard to farmers in financial difficulties. An intensive and highly personal service has been provided to well over 10,000 in difficulty and the progress of more than 6,000 farmers who received assistance under their rescue package was closely monitored. In addition ACOT, in a major initiative with the farming organisations, helped restore to viability a further 2,000 farmers whose assets were under pressure and who were ineligible under the conditions attaching to the rescue package. This vital aspect of ACOT's services is still much in demand. While major progress has been made the suspension of the rescue package, combined with the imposition of milk quotas, continues to threaten the viability of many farmers.

While the Minister referred to the rescue package and his desire to see it restored, he gave little indication and very little hope that it would be continued in future years. I shall deal with that later.

Reverting to ACOT, it is encouraging to note that this organisation has recorded an outstanding increase in the numbers taking part in their educational and training courses. In contrast with 33 per cent five years ago, almost 80 per cent of all new entrants to farming will have undergone a comprehensive training course. At the same time the green certificate in farming has attracted almost 3,000 participants, exceeding ACOT's own expectations. In these circumstances how can the Minister justify a reduction of 3 per cent in their grant-in-aid provision and a reduction of 80 per cent in their capital allocation? Proof of what ACOT can contribute has been outlined here by the Minister and me. Surely it is backward thinking to reduce their grant-in-aid by 3 per cent with a reduction of upwards of 80 per cent in their capital allocation?

I note with disappointment the small but significant reduction in these Estimates to CBF. I may be disappointed but I cannot say I am surprised because, at a food fair in Germany some time ago, in the presence of Europe's agricultural journalists the Minister said he was considering closing down CBF——

I never said that.

(Limerick West):——much to the embarrassment of the CBF staff present.

On a point of order, could Deputy Noonan quote his source? That is entirely incorrect.

Has the Deputy got his source?

(Limerick West): This has been stated, and the Minister knows that very well.

It was never stated. I want the source of the Deputy's quotation because that is totally incorrect.

(Limerick West): That is a statement the Minister made and he cannot deny that.

No, it is not. I want that matter dealt with here and now. If the Deputy makes a statement he should be able to quote his source and, if not, he should withdraw it because it is totally incorrect. We cannot have erroneous statements like that floating about.

Acting Chairman

Perhaps the Deputy could give the date and time.

(Limerick West): That was published in the public press here.

Where and when, give us the date?

(Limerick West): I do not have that information available at present but I will make it available——

It is totally wrong.

(Limerick West): I will give the House the source of that statement in due course, the time, and where it was made. That information will be made available to the House.

That is the sort of thing that causes difficulties.

(Limerick West): I would ask the Minister to allow me continue with my contribution.

That type of rubbish is what causes problems.

Acting Chairman

The Deputy has been asked to produce the source of his statement and he has said he will produce it later.

We know he cannot because it does not exist.

(Limerick West): May I continue? I hope I have not infuriated the Minister too much because the truth is bitter——

No, I am not infuriated because I have said that it is totally incorrect.

Acting Chairman

It is normal practice when a statement is made that the source be made available.

(Limerick West): It will be made available. This statement was made by the Minister much to the embarrassment of the CBF staff present at the promotion and to the detriment of their efforts on behalf of the beef industry.

The Deputy has no grounds for making that statement; he cannot quote a source.

(Limerick West): That indiscreet announcement was followed——

Acting Chairman

Deputy Noonan cannot continue to refer to this unless he can identify a source.

Deputies

Hear, hear.

(Limerick West): I will provide the source in due course. I will not make any further reference to it, I will leave it that the statement was made.

It was not.

(Limerick West): That indiscreet announcement was followed by the unseemly public row regarding the position of the CBF managing director, Dr. Tony O'Sullivan, which, happily, has been resolved. How can the Minister expect an organisation like CBF to function in such circumstances when they are competing on the international market against other national promotion boards whose petty cash allocations would equal CBF's entire budget? It is to the credit of CBF that in spite of the Minister and in spite of their inadequate budget they still managed to successfully promote Irish beef at home and abroad. I am pleased to note their success in opening valuable new markets for Vac-Pac beef in Britain, continental Europe and in Egypt. If last year's rate of increase for Vac-Pac exports is fully maintained between now and 1990 we can anticipate a doubling in the volume of exports of this value added product category. This would mean that exports of Vac-Pac beef by the end of 1990 would be over half our total beef exports.

The Minister and the Government have a role to play here. The fundamental approach must be to increase our beef cow numbers. Price aspirations in the Government's plan Building on Reality is not an incentive to the farmers of the disadvantaged areas. As has already been stated during the week by agricultural experts from this side of the House, it takes a number of years to build up the beef cattle numbers. If we are to avail of the live trade, the lucrative dead meat trade and the value added aspects of this, it is essential that we ensure that beef cow numbers are increased forthwith. In this area there is increased income for the producers, increased employment and increased revenue for the Exchequer. This is where there are sustainable jobs. If the Government's policies indicating their lack of appreciation of the contribution of agriculture to the economy are continued we cannot ensure worthwhile employment in this area. We need major capital investment at beef processing factory level as well as major funding for CBF to promote the finished goods if the industry is to expand from mere accommodation trading in the market to secondary processed products with all the implications for employment.

The suggestion that the CBF be submerged within CTT does not make sense. The CBF have over the years built up a huge reserve of expertise and goodwill in the specialised beef industry and they are respected worldwide. They must be allowed continue marketing Irish beef at home and abroad and to create an image for quality Irish beef. They must also continue to prevent a monopoly buyer situation which would not be in the national interest.

I would remind the House of the sharp decline in prices suffered by beef producing farmers this spring. The heavy cow slaughterings in Europe is the main reason for the drop in prices for beef. Many Irish farmers lost money on animals they had fattened over the winter. How can such an occurrence be avoided in the future? Perhaps it could be avoided by the creation of a special fund, financed by a levy when prices exceeded a certain figure, which could be used to support prices when they fall below a certain level. This fund could be created with the help of the farming organisations and the marts. It would certainly be in the interests of price stability.

If the beef producers suffered in early spring, the dairy farmers have suffered since the beginning of April. Once again the EC farm price talks have dragged on without agreement. This year so far Irish dairy farmers have lost something in the region of £3.5 million because of the delay and they have no hope of getting it back. I do not hold the Minister solely responsible for this delay but perhaps he could suggest to his fellow EC Agriculture Ministers that in future farm price talks should take place in November and that prices should apply for the calendar year rather than from April to March. Whether they are applied in the marketing year or in the calendar year there is no reason why prices could not be fixed in November or December so that at the beginning of the year producers would know where they stood and would know what the prices would be. Because of the uncertainty with regard to prices and the uncertainty with regard to the date of fixing the prices there can be little or no forward planning in agriculture. The Minister might consider making that suggestion to his colleagues in the Council of Ministers.

It seems that the existing time scale coincides with elections in one member state or another and this perhaps has the effect of distorting the approach of different Ministers at the negotiating table. For example, this year the Germans and Belgians are reluctant to come to terms with the cereal question because of a possible backlash in elections next month. The Minister, Deputy Deasy, cannot be too happy at the prospect of coming home with less than total success when our local elections are looming close. The real losers in the delay are the dairy farmers who cannot get any possible increase backdated. They still do not know the value of the milk they produce; neither do they know at what level the super-levy will apply, given the Minister's difficulty with statistics last year and his ability so far to have this error redressed.

In view of all this uncertainty it is not surprising that the dairy industry is in a state of crisis at present. This is most evident in the Munster area where the so-called milk war is under way, with co-operatives being accused of poaching and so on. While supporting the producer's right to supply his milk — I am a producer myself — to the buyer who will give him the best price for his product, I suggest also that those contemplating change should consider the long-term consequences of their decision. I ask also that they remember the spirit and principle of the co-operative movement to which they belong. In turn I urge those co-operatives who find themselves in danger of losing large numbers of suppliers to examine the reasons this is happening and to make the necessary changes before it is too late.

As a member of one of the parties involved in the dispute in the Limerick area I cannot offer myself as a mediator but I ask the Minister as a non-farmer with no axe to grind other than the overall well-being of the industry to use his good offices to bring this needless war to a proper conclusion. I will be speaking, not today but at another time and in another place, with regard to this issue of the co-operative movement, but I toss out to the Minister the suggestion that he might take the initiative. I agree with him that legislation will not sort out the problem. However, he, as the person who at the moment has the responsibility of ensuring the overall good of the industry, might take the initiative in bringing this "war" to a proper and successful conclusion.

I spoke about the rescue package which officially expired at the end of April and so far the Minister has given no formal indication of what the future might hold for those farmers affected. I compliment him that he has been in negotiations with the banks regarding a possible continuation of the package and I ask him to come forward a little more positively and tell the House what the future of these negotiations will be and what the prospects are of ensuring that the rescue package will be continued. The continuation of the rescue package will depend solely on the viability of a number of farmers who are in financial difficulties at present. The Minister might also have seen that only last week the chairman of the ACC called for a retention of the scheme. He recognised that a further year of the rescue package is necessary to ensure that most of the farmers involved reach viability, which was the original objective. This party have already given a commitment that under a Fianna Fáil Government the scheme will continue until its objectives have been achieved. We would not be questioning, as the Minister seems to be questioning, whether a farmer's bank account was in the red or in the black.

I ask the Minister to tell the House what his attitude is to the proposed land tax. My impression is that this tax is being imposed upon him by his Fine Gael colleagues against his better judgment because it seems that it could be the price that must be paid for Labour's continued support in this Government. Would the Minister like to confirm or deny that he has distanced himself and his Department from the proposed tax because he does not believe in it? If my memory serves me correctly, he made a statement that he was totally against the imposition of such a tax. Will he also confirm that it is a senior official from the Department of Finance and not one of his officials who is handling the preparations for its implementation?

Has the Deputy changed his view on that tax?

(Limerick West): The Minister will have an opportunity of replying shortly. He accused me some moments ago of misquoting him. Now I think he is misquoting me.

I asked a question. Is the Deputy in favour of a land tax?

Acting Chairman

The Minister will have an opportunity to reply.

(Limerick West): The Minister should read my statements and he will know where I and my party stand on the whole aspect of land tax.

Do not hide behind your party.

(Limerick West): We will be interested to hear his reply to the questions I have posed to him and I hope he will come across positively. I have said before now and I say again that this proposed land tax is unjust, unnecessary, inequitable and possibly unconstitutional. I feel that it is being pushed through against the advice of all reasoned economic and social opinion. The IFA have posted their strongest opposition to it as have also we in the Fianna Fáil Party. I believe that if there was a free vote on this issue the Minister would have the support of very few of his backbenchers, particularly those from outside Dublin. He is ignoring them at his peril.

The scrapping of the Land Commission, which goes hand in hand with the land tax, is another unwise move. This will open the doors to those with fat cheque books to buy large tracts of land without regard to their background in farming, their ability to farm or any proper training in the development of agriculture. It is the rich men who will benefit from the lack of a Land Commission and the young and new entrant to farming who will suffer. Is that what the Minister wants to encourage? I am also angry at the redeploying of Land Commission staff as agents to implement the land tax. They will become tax gatherers for an unworkable tax and the taxpayers will have to pay their wages. Is there no productive work on which those people could be employed?

I am glad the problem that existed between the Department and the IVU with regard to disease eradication has been satisfactorily concluded. I refrained from making any statement in this regard and I think I was wise to do so. I am glad the matter has been resolved and that we can now move positively, and hopefully progressively, towards disease eradication. There are a few other areas which need attention as regard disease eradication, particularly bovine tuberculosis, and one of these is in the area of records. I hope we will come round to the idea of computerisation of records because the present system is very clumsy and is not having the effect it should and can have. There is still a certain amount of slack with regard to the removal of reactors detected on the farm. There could be a major tidying up of that operation. We might also look at the prospects of carrying out testing in geographical areas rather than in district electoral divisions.

On another occasion I spoke at length about our proposals for disease eradication. We have already published a ten point plan and the Minister might take a look at those positive and progressive proposals which will accelerate the eradication of disease.

I want to refer to stray dogs. The Minister has given a commitment to introduce legislation in this area. I agree that this can be complex and very slow, but I ask him to speed up the introduction of this legislation to ensure that the problems which arise with regard to the destruction of animals, particularly sheep, by stray dogs are solved.

In these Estimates I see little more than a cosmetic juggling of the figures and a host of petty cutbacks. I see a Department being prevented from helping the development of the agriculture and food industries. I see a Minister unable to give the kind of direction and leadership for which these industries are crying out. I offer an alternative which Fianna Fáil will put into action immediately on return to Government. This will incorporate all State and semi-State agencies involved in the agriculture and food industries into a positive and progressive Department of Agriculture and Food. It will involve a realistic plan of action drawn up in conjunction with the farm organisations, the co-ops, the State and semi-State agencies, the food processing industries and the trade unions, and which will be put into action without delay. It will also involve investment capital at fixed interest rates to enable farmers and processors to plan with confidence for the future. We will give agriculture direction, hope and confidence, all of which are sadly lacking at present and none of which can be elicited from this Estimate.

I will make a very brief intervention to try to bring a positive note into this debate. I was disappointed listening to Deputy Noonan. I usually find his contributions very positive, but today I thought he was a bit too negative. I hope that in future he will revert to his old kind of positive contribution for which he has become renowned.

The dairy industry and its diversification has become very topical in this House, and with good reason. In the past we have taken the softer options of powdered milk and butter but we should diversify more, probably in the area of cheese. I read in a journal recently that we are not big cheese consumers. Perhaps there should be better promotion of cheese and cheese products. At the Spring Show we had a very good display of Irish cheese but I believe there is room for expansion in softer cheeses and farm-house cheeses, but we have done very little about that. There is wide scope for development in this area because we are substantial importers of Camembert, Brie and so on. This type of cheese is becoming more popular. I do not think this is an area in which the co-operatives should get involved, because one co-operative would produce enough cheese in one day to last three or four years. This is obviously an operation for young people trained in cheesemaking, as happens in France. It might be a good idea to bring people from the various regions in France and have them train our young people to produce cheese. The young self-employed person would get the milk from a co-operative and return the cheese in blocks to the co-operative so that they could be involved in marketing and packaging.

The liquid milk side of the industry is very important. Great credit is due to the people involved in liquid milk distribution. Our consumption per capita is among the highest in the world. There is a tendency to sell a lot of milk to the supermarkets but I would be sorry if the door to door operation were to cease. It is due largely to the excellence of this service that we consume such large quantities of milk.

The Minister spoke about the increase of 30 per cent in beef production last year and our success in the Vac-Pac and deboning areas. I compliment CBF on the job they have done. Now that we have peaked in milk production, we must look very carefully at the type of dairy cows we are using. I was interested recently to hear the president of the British and Irish Friesian Society make the point that we have enough genetic material here to produce our milk quota. All we need is better feeding and improved management of that dairy herd. We would be entitled to the upper slice of the market but we certainly will not get that from Holstein dairy cows. There may be a tendency for farmers to go for more Holstein and fewer cows. That would be a retrograde step because the dairyman has to bear in mind that there must be somebody left to buy his calf. He must also bear in mind that that man is working on much smaller margins than he is. Comparing our calf prices with those in the UK, many would say that our prices are far too high and cannot be sustained. Even worse would be a swing towards Holstein females because the danger would be that the beef man would end up with a mediocre product. There is a further problem that growth promoters are being discouraged by the EC and may in time be banned altogether. We all supported the bull licensing legislation which was going through the House and were almost unanimous. However, there were problems and I would be the last person to deprive even a single farmer of his livelihood because of legislation. As a result of discussions I have had with my good friend, Deputy Joe Walsh, we may be able to find a solution to that problem, especially in the short term.

The Canadian deal is particularly important in my neck of the woods. It was an achievement to get this tonnage, especially as IMP in Midleton has forward packaged for this market. I am glad that matter is working out.

I must compliment the Department of Agriculture on their stand at the Spring Show, one of the finest displays of sheep I have seen at any show. It gave a clear indication to sheep producers, particularly new entrants to sheep production, of the importance of breeding for quality and for prolificacy, bringing us into line with our competitors. One of our problems is the smallness of our market. We must look at the overseas market. The EC is only about 80 per cent self-sufficient in sheep meat but they are seeking sheep meat of a particular kind. The French will tell us what they want. Over the years we went into the field and produced something, hoping to God we could sell it. Nowadays we are becoming more sophisticated. We are finding out what housewives are buying in the supermarkets and endeavouring to produce it.

I am delighted that the Government have decided to do something about the terrible problem of marauding dogs. We have all seen on television the results of these terrible attacks on sheep and the farmers have suffered greatly. Dog wardens will now be appointed by local authorities to deal with licences and pick up stray dogs.

I was delighted to be involved in the launching of the National Potato Co-operative and I would appeal to everybody in this House to support it. Every Deputy has influence in his own area. The co-operative are launching a shareholding drive and this should be supported. They need to have paid-up members in order to inject the necessary discipline into the area of potato marketing. In previous years there has been chaos and farmers have been dumping Dutch potatoes into the sea. That sort of thing should never happen again. With the registration of potato growers we should be able to bring a discipline into the market. It was a pleasure this year to visit supermarkets and see Irish potatoes properly presented. We are overcoming the problem of bad presentation to such an extent that imports of potatoes have been negligible this year, except ware potatoes or processed potatoes.

The import of potato chips is a major problem. I have been devoting some of my time to it. Some overseas people have been looking at the possibility of setting up a processing arm here. They are very interested in establishing here. We have satisfied them totally that we can grow the fairly substantial quantities of potatoes they need at prices they can afford to pay. We can offer continuity of supply plus the advantage of a £30 million home market. That is the kind of bonus they would not get in any other country. That type of processing would be a step towards import substitution but would also help the ware market scene. We could cater for over supply by processing.

I have the report of the horticultural development group and, as a result, we have decided to grant fairly substantial aid to the glasshouse industry. Mushrooms have been very successful and are now doing very well on the export market. Tomato growers are competing very successfully with Dutch imports and are producing very high quality tomatoes because of the grants they received to convert from oil to solid fuel. Some years ago vegetables were confined to a corner of the supermarkets but now the major supermarkets both here and in the UK, including Sainsburys, have hundreds of feet of counters devoted to fresh vegetables. Much of this is due to medical advice regarding food but it is also a challenge for us. With that in mind I have regular meetings with producer groups of the IFA and we hope to set up an association of Irish horticultural producers to co-ordinate their production and to fill that market. Because of the limits of that market we must look to overseas export of fresh products and I am delighted that a company in Wexford, Agri-Gold, are doing that. They are contracting at present for supplies of cauliflowers and winter carrots for export. I hope that they will be successful in this regard.

We have had failures and successes with processed vegetables and I think we are starting to pick ourselves up again. We did not move quickly enough into the freezing side and it was taken over pretty quickly by our competitors. Success in future will depend very heavily on our ability to tie in with the people who already have these markets as there is no hope of beating them but there will be benefits in joining them.

The Minister already referred to flour imports which work out at about 20 per cent at present. However, the true situation is much worse as many of our millers are using imported wheat which means that the total figure will be nearly 80 per cent. This presents a challenge to look at the possibilities of growing higher quality protein wheats to supply that market. While it is important that flour is milled here, it is doubly important that we grow our own wheat and have it milled here also. We have plenty of high quality protein wheats and it is a pity that we did not succeed last year in convincing the millers that they should take a lot more of this wheat. The fault was in poor assembly and we will have to devote a lot more time to that aspect.

We should also be using more of our own grain in compound feeds. The Sugar Company are revitalising themselves and are facing the challenge of having peaked in production. They are now limited to a certain tonnage of acreage for sugar. I should like to compliment them on their wonderful survey on soil sampling because, to be personal, it has cut my fertiliser bill in half.

With regard to new products, I have looked at the possibilities of flax production. In my short time as acting Minister in Brussels, I discovered that there was a sum of £100 per acre available for this. Linen seems to be the "in" thing with regard to fashion and there is a big demand for it in the Middle East. We were not able to grow enough seed this year to provide any substantial quantities but we have trial plots and a fairly substantial company in the clothing industry have expressed an interest in flax. They have agreed to look at the possibilities of installing a scutching mill which is the primary stage of flax production. If this takes off, I hope that the eventual outcome will be a linen industry which would need 10,000 acres of flax.

ACOT are doing wonderful work and I had the honour to be invited to the conference of their district managers the other evening. I was very heartened at their businesslike approach towards the industry. They now have first class dairy and horticultural specialists and they are doing better than ever, even though they said that if they were not wealthy they were healthy. I was delighted with their spirit and, under Dr. Donnelly, they will go from strength to strength especially with their tie in with AFT.

I should like to give my colleagues an opportunity to speak and I am very happy to have participated in this very important debate.

I am glad of the opportunity to contribute to this debate. Unfortunately, in many areas it is not easy to make a case for the further development of the agricultural industry because, regrettably, many people regard agriculture as synonymous with farming.

Agriculture as a total industry is far more important than just the farming industry. It contributes in a far more substantial way to the development of the economy than just the farming community, and it is a pity that we have an extension of the urban-rural rift because of the misconception regarding farming and general agriculture.

I should like to see people generally looking at agriculture as a resource of 12 million acres of land which is arable for the production of many items. We also have about five million acres of marginal land which is a very valuable resource for the production of good forestry type products. In the last couple of years we have developed from an era of expansion in the agricultural industry to one of constraints as far as our major products are concerned. The implementation of the super-levy had major significance for the cornerstone of the industry. Notwithstanding the constraints, with prudent management of the dairy industry we can still make a very sizeable contribution to the overall economy by the further development of the dairy element of the agricultural industry. If we have a quota threshold which we cannot exceed without being penalised, it would be prudent to work within that threshold to our best advantage. It is regrettable that the Department of Agriculture appear to be going in the wrong direction in that area. As a dairy industry, we must maximise the return to the farmer producers. It is estimated that those producers only get in the order of 85 per cent of the target price in the European Community for their milk. In contrast, the Danish and the Netherlands industries get in excess of 100 per cent of the target price.

People may wonder why the dairy industries in other countries are able to achieve that. They achieve it because the industry has developed products for which there is a good price. In other words, they establish what is required by the housewife and the market generally and develop products to meet those requirements. Unhappily we are going in the opposite direction. A higher percentage of milk is converted into butter today than when we joined the EC or before the super-levy was introduced. That is regrettable. Unfortunately, the Department have compounded the situation by allowing co-ops to operate illegally by purchasing milk on a flat price basis.

We have only to stroll down any street to see imported dairy products which we could produce here. We have the technical know how and grant aid from FEOGA to help develop our food processing industry. Unfortunately, we seem to take the easy way out and produce bulk commodity products. Those products can be taken up in intervention and we do not have to bother that much with marketing, product development or processing. The Department would need to take the matter of the payment for milk seriously. Yesterday at Question Time the Minister admitted that some co-ops pay for milk on a flat price basis which is illegal. He said he did not intend to do anything about this except to have a review in his Department to update the 1924 Act.

That is not good enough. I shall insist that section 32 of the Act be adhered to. That obliges people who are purchasing milk for manufacture to pay on a butter fat basis. I strongly recommend that the payment be extended on the basis of the other constituents in milk, mainly protein and lactose. The industry should regard milk as a raw material which could be used in the manufacture of a variety of products. Not only should the Department encourage that but it should desist from allowing illegality in this very fine industry.

The single most important factor in having a dynamic industry, be it beef, lamb or whatever, is to have a high quality product. Nine times out of ten the Irish product is of top class quality but, as a result of lapses in monitoring quality, markets are lost. If we cannot supply consistently high quality produce it is very difficult for anyone to do anything about it.

We were informed yesterday that no pig slaughtering plant had achieved the standards required by the US. That is an appalling indictment of the pig processing industry. It is no wonder we have such a high level of food imports or that markets have been lost. The Department, as the major regulatory body, should insist on very high quality products. I am convinced that out of the 175,000 farmers, one-third are superb producers of agricultural produce. It is regrettable that their produce is often ruined by poor processing and poor marketing techniques.

The bulk of the money from the FEOGA grant for the modernisation of our pig processing plants has not been taken up by the food industry. That is a pity. We will have to develop a different attitude. We will have to encourage market led, consumer orientated products if we are to develop our industry to the greatest possible extent.

I mentioned marginal land earlier. I am glad that in the new structural policy there is encouragement for the planting of that land. As a result of the constraints on traditional products there is a tremendous market in Europe, which is only 60 per cent self-sufficient in forestry products. There is a market in the UK for forestry products and I hope the Department will give a higher profile to the development of forestry as a adjunct to agriculture. I call on the Minister to have a foreign forestry policy provided by the EC and in the meantime to have at least timber included in Annex 11 of the Treaty of Rome as an agricultural product.

Mention has been made of ACOT and I concur with the views of previous speakers that it now has dynamic leadership, is well structured and is doing a good job. There are 70,000 farmers on their list but I would ask the Minister to ensure that they do not forget about the other 100,000 farmers who are disadvantaged in many ways. I should like to see ACOT formulate a programme to help and encourage such farmers.

With the new structures policy there is a reduction in the amount of red tape required for the implementation of the farm modernisation scheme. ACOT should have a parallel programme to help small farmers. It is incomprehensible that 100,000 of our farmers are about to be left behind when there are no opportunities for them in industry. The dole queues are becoming unruly. We should not try to pressurise additional people to join the dole queues when they can make a living on their farms. We should try to retain them there and we should have greater support for them through ACOT. I should like to see ACOT formulating a programme for those people.

Regarding training for agriculture, there is an imbalance in that we spend 12 times as much money on training for industry as we spend on training for agriculture. In 1984 we spent £104,512,000 through AnCO. We spent a further £38,284,000 through the Youth Employment Agency, making a total of £142,796,000 on training for industry. Unfortunately the opportunities for those trained for industry are contracting. We spent a mere £12 million on training for agriculture, an industry which has tremendous potential given the leadership and the support required. That is a 12:1 imbalance. I strongly urge the Minister at the Cabinet table to get a greater allocation for agricultural training.

Before I leave the farm modernisation scheme I have one request to make. About 6,000 farmers who were denied grants-in-aid under the old farm modernisation scheme because of the technicality of prior written approval should be paid those grants to which they are entitled.

We have a Control of Bulls for Breeding Bill. I support the improvement of breeding. This is consistent with my attitude to the production of the very best quality products. I am glad the Minister of State, Deputy Hegarty, has been convinced that in areas like the Schull Peninsula it is most difficult for small farmers with small herds of five or six cows up in the mountains to avail of the AI service. They have not got the resources to purchase pedigree premium bulls. Such bulls, subject to inspection and permits, should be made available to those people.

On the question of the difficulties of co-ops I should like the Department of Agriculture to consider increasing the three months requirement for a transfer from one co-op to another to at least 12 months. It is most difficult for any co-op to programme their produce and product mix in the three months available to them and to know what throughput they will have. I concur with the President of the ICMS who suggested recently that people should decide before the beginning of the calendar year where they would supply their milk. I should like to see that three months requirement extended to 12 months.

I should like to start by complimenting Deputy Walsh on his fine contribution. All the contributions so far have zoned in on the biggest issue facing the Department and the food industry. The Minister referred to the competitive pressures on the food industry. We have heard ad nauseam this morning that food processors have stuck to commodity products and the secure markets of intervention in terms of milk products and beef and sheep meat.

Our food industry is at the crossroads. We have various problems. We have import levels of food, vegetables and finished consumer products which are unacceptable in an agricultural nation. We also have a huge missed opportunity in terms of value-added products for secondary processing. A couple of years ago the IDA produced a major strategic report on the food industry. A decision was taken that this year SFADCo would be responsible for piloting new food projects. We have discussions about the National Development Corporation having a role in the food sector. At the same time individual organisations like Bord Bainne are pursuing marketing developing schemes and 70 per cent of our beef exports are on the bone.

Major issues have to be faced. We cannot face them with rhetoric or lip service or by exhorting people to pursue quality production. I believe we must restructure the Department of Agriculture. The Department are seen as a farming Department. We should have a Department of Agriculture and Food. The IDA section and the SFADCo section dealing with food should come under the aegis of the new Department of Agriculture and Food. If we look at the import problem we see quite clearly that the Department have not got clout. I will deal with flour imports in a moment and I will be very critical of the Department's inaction.

Most of the problems of agriculture are due to the fact that farmers do not understand the difference between marketing and sales. Selling means selling what you have got and marketing is selling what people want. We have the production of huge surpluses. There is no commercial approach. Unless there is a restructuring at departmental level, unless there is a total tie in between what the Department are doing for primary producers and what the IDA and other State agencies are doing for manufacturing industry, there will continue to be grey areas and a dissipation of effort.

If we take two examples we can see the problems clearly. Let us take the example of the flour industry. If the Minister of State were to examine in detail the balance sheets of all Irish flour millers for 1983 and 1984 he would see that they are tottering on the brink of survival. They are all showing losses without exception. The Minister said the problem was not as bad as it was and that the figure had gone from 9 per cent of UK imports to 20 per cent. It is far more dangerous that the UK flour millers have made it quite clear that, whatever price Irish flour is set at, they will drop their price by £10 or £20 a ton. There is no future for an Irish flour milling industry with that kind of threat hanging over it.

The efforts to date by the Department of Agriculture to deal with this problem have been totally fruitless. At EC level they seem to be more preoccupied with keeping Ireland's record clean with regard to our agricultural exports than in putting the boot in. A special case can be made for our bread baking industry in case there was a dock strike or any kind of national emergency. We have multiple stores, Dunnes Stores, Quinnsworth, Tesco, and so on, many of whom are British based. The five large multiples have 60 per cent of the total Irish retail trade. They must be hauled over the coals about selling bread made with Irish flour and selling Irish flour. They do not care. Unless they are told that other threats about van and below cost selling will be envoked against them, we will see the decimation of the flour industry. For the past two years the Department have been aware of the situation because they have been warned many times in this connection. The only difference now and two years ago when Ranks went out of business is that flour millers are going bust slowly. They cannot continue to sustain the level of losses they have been carrying.

The same applies to mushroom development. One might think from listening to the Minister's speech that all is well in this area. A receiver has been appointed to Top Quality Products in Gorey where there are 147 jobs involved. There is no correlation in terms of State approach between the satellite growers and mushroom processing. It is farcical that these people should have to depend on the Department in respect of growing mushrooms. As in the case of potato processing, the important element is the postfarm gate activity. I could quote a series of figures which indicate the lack of uptake of FEOGA grants and all of which point in the same direction. Therefore, I urge that the Department be structured on the lines I suggest.

In view of the time limit I shall only have time to flick through a number of current issues that are of grave concern. Since our accession to the EC there has been a huge shift in emphasis in terms of decision making. There are two issues that are of vital and immediate concern. Our farmers are being put into the sort of situation that existed in the late seventies. Recently we sold 400 hoggets and they realised £25 per head less than they would have realised this time last year. Cattle prices are down by £80 a head on last year's prices. Farmers' incomes are not stable. They are eroding rapidly. The cost of fertiliser, which is an essential ingredient of productive farming, has increased far more rapidly than the increase in the consumer price index. Therefore, we are returning to the situation of a cost-price freeze on farmers' incomes. In addition, there is the threat of the land tax. It will be unacceptable for the Minister to return from the Council of Minister meeting with anything less than the same increases as last year.

The other area of difficulty relates to the super-levy. The Department, in conjunction with ICOS, have been dragging their feet for the past six months on the question of granting milk quotas to people who up to now have not been granted quotas. These are people who drew up plans, who availed of the farm modernisation scheme and who have ten or 20 cows with a projection of 50 cows but who are being put out of business because of not being granted a quota. I trust that next week when the Minister announces a package for new entrants he will do so on the basis that farmers and producers who have been through the various schemes will be granted quotas and, thereby, the means of a livelihood. These people have borrowed extensively but there is no future for them and no opportunity to diversify into another form of agricultural production. As co-operatives have been granted quotas, there should be drawn up within each co-op a priority list of these farmers from whom the flexi-milk would be bought, the allocation being on a pay back basis over a number of years and in accordance with the farmers' ability to pay.

I welcome very much the abolition of the Land Commission. They must be the only State agency who do not notify people as to whether their applications have been unsuccessful. At least any other Department would have the courtesy to notify people in this respect. The Land Commission do not have a proper system in terms of the allocation of land. In the case, say, of the allocation of an estate of 40 acres for which there are 12 applicants, the news as to who the successful applicant is, is heard by way of rumour locally. There are party political points also that can be made in relation to the allocation of land.

It is disgraceful that the Minister should be in a position to tell us that the Land Commission are in possession of 33,000 acres which they cannot dispose of by 1986. This matter should be referred to the Committee on Public Expenditure. There is very little work to be done in regard to the disposal of those estates. Some of them have been on the commission's books for three or four years. There is a list of applicants and all that remains to be done is to make a decision. Each year the land is leased on the 11-month conacre system.

I would be critical of the Land Commission also in terms of the income they create for solicitors by reason of the red tape engaged in in respect of subdivision consent. Of course there is a point about splitting an uneconomic holding but some of the delaying tactics of the commission are disgraceful and make matters very awkward for farmers who are in financial difficulties and who must sell land.

I trust that, following the abolition of the commission, the Department will adopt a much more flexible approach in relation to subdivision consent. I trust, too, that during the autumn of this year the Minister will sanction increased funding for farmers so that low interest money will be available to them in respect of farm modernisation schemes and so on. Up to 70 per cent of agriculture is under-developed but the necessary finance must be available if it is to be developed fully.

I welcome the restructuring of the farm modernisation scheme following the Council of Ministers directive, but I would reiterate a point made by Deputy Walsh regarding farmers who drew up farm plans, who co-operated in every way in terms of complying with the criteria for the scheme and then found in February 1983 that they would not receive a grant because approval had not been sanctioned before that date. Only a small number of once-off cases is involved so I trust that in the restructured scheme some money can be found to compensate these people who have been so badly treated and who had borrowed money on the strength of the payment of the grants. It was merely because the farm development services officers did not have written approval in time that the grants were not sanctioned.

I had much to say regarding the TB eradication scheme but time does not permit. Between the fifties and the seventies we made rapid progress in reducing from 17 to 2 per cent the incidence of TB in herds but there has been no progress since then. The Government, correctly, have revamped the scheme and have tightened up its operation, but some aspects of it must be examined if the disease is to be eradicated. There is need for extensive research and development into the causes of severe outbreaks of the disease and into the means by which it is spread, whether by badgers or by some other form of wildlife. Another factor, too, that must be given attention is the form of tubercular used in the test. I am not satisfied that the existing research development in the State laboratory is satisfactory in regard to all these matters. We must pursue the problem, as the British and Dutch pursued it, in terms of the scientific aspects of it.

Compensation for reactors when the animals are below the 182 kilogramme weight needs to be increased. There is some compensation by way of the factories for the heavier stock and the reactor grants are quite all right but there is discrimination in terms of the younger and lighter stock.

Regarding the hardship fund I suggest that the £6,000 limit be dropped and also the first 20 per cent ineligibility clause. The owners of locked up herds should be in a position to sell their stock of live cattle to third world countries. There is a problem also in regard to animals that are termed doubtfuls. All doubtfuls should be recorded as being negative. I have known of many farmers who were told after veterinary tests that there were two doubtfuls among their herds but who, after the complete herd had been tested, were told that up to 12 cows failed the test completely.

Dealers and hauliers should be licensed through the district veterinary offices. One trusts that the extra funding required by way of the agreement of the veterinary surgeons would ensure that we would be in a position to drop the 30 day test and instead to have twice yearly tests for all herds at six monthly intervals.

I welcome very much the new legislation for the control of dogs. The estimated loss to farmers as a result of dogs worrying sheep is estimated to be of the order of £4 million per annum. This is unacceptable. That only one in seven dogs is licensed is an absolute disgrace. I hope that the new dog wardens will, under Department of Agriculture supervision, be able to ensure the provision of the necessary shelters and that licence fees are collected.

In relation to the new EC directive regarding hormones, I cannot accept that there should not be exemptions in this area. Certain medical preparations for calves, in terms of calf scours and other products, should be exempt. I also cannot understand why natural hormones which have no chemical factors should be out-lawed.

I must express disappointment that a substantial part of the Mackamore area along the eastern coast of Wexford, which for the past 14 years has been seeking to be included among the disadvantaged areas, has been totally neglected and forgotten. I hope that this application will succeed in future. I also request, on a once-off basis, that the application closing date for the ewe headage payment scheme be deferred from mid-March to mid-May, because many who were previously issued with application forms were not issued with them this year.

I specifically request an agricultural college for Wexford, which has no college of any description for third level education. Since we are responsible for 10 per cent of agricultural borrowing and are the most intensively farmed county in the country, this would be well deserved.

The rescue package is currently under debate. I understand that total agricultural borrowings are of the order of £1.4 billion. The farmers who have benefited under this package can lose their benefits and slip back into severe financial arrears, which will result in the sale of assets and, in certain cases, bankruptcy. Looking at the projected pattern of agricultural incomes for this year, given the difficulties caused by EC price fixing, it is essential that the necessary steps be taken to ensure the continuation of the rescue package. The banks have got away with too much for too long. They have played too cute and have disowned their responsibility. They will benefit more than the farmers. We have seen the Mark Hely-Hutchinsons and the Crowleys of this world moaning about their bad debt provision for agriculture. If they are so concerned about it, they should co-operate with the Government. This cat and mouse game of bluffing as to who is to make the larger contribution for the continued rescue package payments must be sorted out very quickly, because the gale days are now due for payment by farmers.

The Minister's intervention today into the tote monopoly question as regards the betting industry was most unwarranted and unfair. There is no doubt that the racing industry will benefit by the reduction in the racing board levy and the tax reduction this year, both on and off course. There is substantial scope for development because the greyhound and the horse industries are extremely valuable both on the export side and with regard to racing amenity value. I totally oppose any move towards a tote monopoly. As well as being unfair, it is unworkable and will not give the benefits to the Exchequer which the existing system has done.

I reiterate that Ireland's food industry is at the crossroads. We need to restructure the Department of Agriculture into a Department of Agriculture and Food. We must take account of the latest competitive pressures in terms of quality control and continuity of supply. We must link in the work of SFADCo and the IDA with the Department of Agriculture, with a view to providing a co-ordinated food industry. It is only by doing so and by identifying new products such as Yoplait yoghurt and new types of cheeses that a secure income will be ensured for farmers in the future. They should not be told by the bureaucrats of the EC that there is no one to buy their products because no one made the effort towards diversification and marketing. They must not be told that there are huge surpluses and that they cannot get a price increase.

The only way in which we can avoid future disasters with regard to farm incomes and in which the EC can develop and ensure the success of the Common Agricultural Policy is through linking food and farming. That must be done through restructuring.

I call Deputy O'Keeffe. He has 20 minutes.

I welcome this opportunity to speak on this very important Estimate before the House. It is now the mid-term of the present Government and it is important that we should look at the record to see what has happened to our greatest national industry, agriculture. I believe that it will remain our greatest industry for many a long day.

I believe that the Minister for Agriculture is in total retreat from the agricultural industry. In real terms, farm incomes today are only 64 per cent of what they were in 1978. The beef cow herd has fallen below 400,000 cows, milk output is constrained by quotas, winter beef fatteners have taken a hammering, sugar beet prices are lower, grain prices are under threat with levies and quotas, out lamb exports to Paris are suffering because the Minister is dragging his heels about a lamb classification scheme and the pig industry is in total disarray. On top of all of this, taxes, levies and charges have become the new lot of the farmer under this Government.

As the Minister pathetically attempts to correct his bungling of the milk super-levy negotiations in Brussels, whole sectors of farming are collapsing around his his ears at home. Indeed, farmers may well ask whether agriculture is represented in the Cabinet at all at present because this Minister, since he came to power, has implemented twenty major cutbacks at home which have all taken money out of the pockets of farmers. Indeed, it is no exaggeration to say that since Deputy Deasy came to power he has given more away in the rough and tumble of Cabinet horse trading than the previous five Ministers for Agriculture put together.

Let us examine the index of decline. It speaks for itself. In the 1983 budget the Minister reduced all farm income limits for the disadvantaged area scheme from £5,400 to £3,500. That is the first step; (2) farmers were required to pay for the visits of Department and ACOT staff in relation to the farm modernisation scheme under the 1983 budget; (3) eligibility for the national 5 per cent supplement was restricted in the 1983 budget which was a terrible loss; (4) the Wool Council was abolished in the 1983 budget; (5) no further applications under the farm modernisation scheme would be accepted for the remainder of 1983 under the budget; (6) the group fodder scheme and grant for mobile equipment and farm accounts were all abolished in the 1983 budget; (7) the farm retirement scheme was abolished in the 1983 budget; (8) arterial drainage was cut by £2 million.

Then you had the 1984 budget and more cutbacks in agriculture; (9) veterinary inspection fees were increased by almost 50 per cent; (10) disease levies were introduced on all bovine animals slaughtered or exported live; (11) disease levies were introduced on all milk sold; (12) payment by the Government on intervention purchases of beef were delayed by a further six days; (13) payment by the Government on intervention purchases of milk were delayed by thirty days — all of loss to the co-operative movement and the farming community.

Then we had the infamous national plan of October 1984, when several further measures were taken: (14) the Land Commission was abolished and not replaced by a new land agency as promised, and as a result land policy generally is in the doldrums, and the Land Commission inspectors have been transferred to collect the land tax; (15) there was a doubling of disease levies on livestock; (16) there was a doubling of disease levies on milk; (17) the land tax of £10 per acre to be implemented in 1986, was announced.

There are also further measures that can be added to these and it is important to remind the Government of what they have done to agriculture and the treatment they have meted out: (18) the disadvantaged areas headage payment, unchanged since 1981, has been cut by £1 per head, with restrictions on the amount of flock size that can qualify — that was this year; (19) also this year, the rescue package for farmers in financial difficulties was terminated and the Minister still is dithering as to whether he should reintroduce and extend the scheme. We blame the banks, as Deputy Yates has not, but I do not agree with that.

Meanwhile, up to 3,000 farmers are in serious financial difficulties and are in danger of going bust, in ordinary layman's language. (20) and not the last step by any means on the Minister's ladder of decline, is that he has abolished the A.I. subsidies which were so important for the development of our animal breeding herds.

One could go on. For example, shortly after he came to power, the Minister got a very useful four year plan from a representative working group as to how agriculture could be developed. There were two main proposals in this plan: (1) that all farmers in a position to develop should have access to the higher rates of development grants; and (2) that they would also have access to long term low interest loans.

This four year plan remains gathering dust in the Minister's office at the moment and he has completely ignored the two major recommendations in the report. Indeed, the Minister has gone further and not alone is the rescue package terminated and a 5 per cent interest subsidy scheme abandoned, but the £100 million worth of loans of cheap Euro currency in the banking system are to go at the end of October and there is no indication from this Minister that this Euro currency scheme which has been vital to farmers over the past four years will be renewed.

Definitely this is a record of shame. On top of all this, the Minister is party to a proposal to implement a land tax on farmers. Yet the official data of farm income shows that two-thirds of all Irish farmers have an income under the threshold level for payment of income tax by a married couple. The land tax proposal in fact, would take tax from those who have never had taxable incomes. The land tax takes no account of one's ability to pay or family circumstances. It is a crude, anti-family, anti-rural, and anti-farmer device and the Minister will get his answer in the local authority elections on 20 June.

The structure of Irish farming is such that we rely mainly on the dairy herd to provide calves for the beef industry. At best the dairy herd will not expand in the immediate future, resulting in a freeze on the number of beef animals we can produce. This will happen unless there is a dramatic and radical expansion in our beef cow herd. Indeed, the Minister has already presided over a major decrease in the cow herd and since increasing output in dairying is no longer an option due to the EC milk super-levy, we must now as a nation be concentrating on increased beef output rather than presiding over further decimation of the herd. We must remember that the supply of calves will be in short supply as we are starting from a base of 140,000 fewer than ten years ago. To add to the problem, the efficiency of our dairy farmers means that the volume of milk required will be produced from fewer cows and this will result in fewer calves for the beef industry. To compound this problem, dairy farmers with no possibility of expanding in dairying will hold on to more calves, reducing the supply of calves to beef production further. The beef industry is one of our major export earners and we must have a thorough look at that sector.

The stabilisation of the national beef cow herd at 400,000 or a modest increase is no compensation. We need a dramatic increase in the beef cow herd and we need dramatic measures to stimulate it. The increase in the grant aid in 1986 for beef cows in the disadvantaged areas dropped £32 to £70. It is a welcome step but it is totally inadequate to meet the requirements over the next few years. An immediate package is required to boost the beef cow herd outside the disadvantaged areas as well as the disadvantaged areas because the profitability in this enterprise on its own is inadequate to encourage expansion on the scale required. At least £70 for every beef cow should be paid outside the disadvantaged areas as well as in these areas. The target should be for an extra 200,000 cows outside the disadvantaged areas.

The Agricultural Association has shown that the cost benefit of such a scheme would be very good. The cost to the State would be around £14 million per annum but a total of 200,000 beef cows would create a realistic income for 5,000 farmers and based on the extent of beef processing currently existing in the country this would create 370 jobs in meat factories and in exporting. At least the same number of jobs would be created in other services such as milling, and so on. For an investment of £14 million, the cost of each job created would be less than £2,500 per year, or £17,000 per job when compared with the cost of industrial jobs.

The Government would get this back with taxation and would save on the cost of welfare to 5,740 individuals. An additional benefit, however, would be the increased value of exports. We have had much publicity on our success in getting the new electronics factory for Greystones. Based on unofficial figures the cost for initial jobs created in this factory will be in excess of £50,000 per job. There is no comparison between stimulating the beef industry and bringing in a new electronics factory for Greystones. It is about time we started to get our priorities right.

The consequences of failing to expand the beef cow herd rapidly are serious from a national point of view. From a national point of view, output in dairying will remain static for the foreseeable future and unless action is taken output in cattle and beef will remain static also. This will have serious effects on the economy especially in relation to exports where agriculture contributed so much in the seventies and in the eighties.

From a farmer's point of view, the question arises as never before of what to do with the land. Dairying is no longer an option for expansion and in beef production calves are likely to be scarce or very expensive, making beef production difficult. Sheep will be a solution for some but only for a small number of farmers and tillage profits are declining. The start of a national solution is to increase the beef cow herd. We just have no alternative.

This Minister and his Government have often tried to give the impression that they are spending vast amounts of money on farming. It is important to put this in context. Of every pound spent by the Department of Agriculture last year, only 24p reached the farmer. Government expenditure on agriculture is in fact in serious decline. It has fallen from over 15 per cent of Government expenditure in 1970 to 4.3 per cent this year. Indeed, expenditure for agricultural education and research and inspectorial services is now less than 1 per cent of Government expenditure.

The reason put forward by the Government for low expenditure in agriculture is shortage of finance. This is only true up to a point. Last year the Government spent a colossal £5,580 million. The real question was how the Government spent this money. Could some of the money be spent on creating viable jobs in farming? There is absolutely no doubt about it. The importance of development in agriculture with 190,000 employed on farms is reflected very poorly in the miserable allocation for farm development compared with other sectors where State funds are being provided. The minimum that is required is a proper farm modernisation scheme based on actual costings with the present restrictions removed and based on the pre-1983 percentages of grant aid.

This Government have destroyed the farm modernisation scheme. Furthermore, the Government should introduce the EC scheme for establishment aid for young farmers which was recently proposed by the EC Commission. This would allow £11,000 to be spent in helping young farmers who are working towards establishment plans. We should take action in this area immediately and implement this valuable scheme. This package would cost well under 1 per cent of Government expenditure.

The production levels of Dutch farmers is often held up as an example for Irish farmers. What is conveniently forgotten is that capital investment on Dutch farms is eight times our rate and the intensity of their advisory service to farmers is five times greater than in Ireland.

The Minister's inaction of the land classification scheme can only be described as a national scandal. A market is available for our sheepmeat but only for a satisfactory product. It is disturbing to note that our sheepmeat is being discounted in Paris at up to 26p per pound carcase rate compared with British exports. I appeal to the Minister to take action and to ensure a proper classification scheme for lamb. Farmers and factories must stick together to agree on realistic price differentials based on independent carcase classification. The obvious body to carry out this grading are the Department of Agriculture. A proper grading scheme will ensure that farmers will produce lamb with the French market foremost in their minds.

I would appeal to the Minister not to go ahead with the hotch potch political scheme on the table at present, which the IFA are opposing, but rather to introduce a proper lamb classification scheme on the same lines as the beef classification scheme applicable in factories which has proved to be highly effective. The abolition of the central marketing organisation for pigmeat and the price support scheme in the past year have left the pig industry completely vulnerable. In the short term it will be necessary to have a subsidy export which must be by way of voluntary subscription. For years we have been requesting the Minister to introduce legislation to register all pig slaughtering premises. At present many pork butchers have been reluctant to pay the levy, causing friction within the bacon industry generally, with a number of curers refusing to become involved in market stabilisation support.

A growing and dynamic agricultural industry is in the interests of our overall economy and our people but apparently the Government and the Minister are blind to this fact. We do not want our agricultural industry to become an historic curiosity in the European backwater. We want to see our industry treated positively in the context of overall Government planning which must take account of the levels of public expenditure and investment priority.

Irish farmers, in common with their counterparts in other developed parts of the western world, have a tremendous capacity to produce more food. While this capacity exists one of the greatest obscenities in today's world is that people with the same emotions as you and I, Sir, die of starvation. It is estimated that over the next 50 years world population will grow at a rate of 1.7 per cent annually while cereal production will increase by 3.5 per cent annually over the same period. This presents a challenge to politicians and Governments the world over. While the capacity exists today among farmers to ensure that not one human being goes to bed hungry there must be something wrong somewhere internationally when policies exist to reduce potential for food production. I was proud to hear on radio this morning the efforts of the president of the IFA, Mr. Joe Rea, to bring together the other farming organisations and his magnaminous gesture to them. I wish him well in his efforts. I have no doubt but that he has done an excellent job in defending agriculture.

I have outlined already for the Government and the Minister what has happened to agriculture here. If the present Government policy continues we shall have no agricultural industry remaining. There has been talk of decentralisation. I believe the Department of Agriculture should be transferred to Moorpark, Fermoy, Co. Cork, the major dairying research centre which has received world recognition and is renowned as being one of the leading centres throughout the world.

I am delighted to be given this opportunity of saying a few words on the Estimate for my Department.

While I shall be dealing specifically with the section with which I deal mostly, that of land policy, I wish to refer to just a few matters and elaborate on some of the points made earlier today. Some people on the Opposition benches would lead one to believe that our agricultural industry is about to crumble. That is difficult to understand particularly having heard the president of the Farm Machinery Trade Association say on radio as late as last evening that he saw a definite upswing in the interest being displayed by the farming community at the RDS last week. That is a reasonable barometer of the way farmers are thinking. He also let it be known that for the first time in three or four years more interest was shown in the purchase of large tractors and heavy machinery, a reasonable enough barometer of the mood in agriculture.

It is fair to say that, as an agricultural country, we are faced with huge problems, not of our making. They were imposed on us, as they were on many other European countries, not the least of which is the milk super-levy. There are a few matters I should like to put on record about the levy itself. There are categories of farmers who are seriously hurt by it. One can be sure that one could never introduce a super-levy without hurting somebody. I want it to be known that the Government and my Department are doing everything humanly possible to alleviate some of the problems confronting new entrants to milk, that category of farmer.

I should like to refer to the disease eradication programme and to place on the record that, for the first time ever a Government and a Department have taken this programme extremely seriously and have put their money where their mouths are, which is exactly what we have done on this occasion. It is something on which I have no doubt taxpayers' money will be well spent. If we do not rid the country of the dreaded disease of TB then people who never stood on an acre of ground and who are not involved in agriculture will be hurt. If we are unable to rid the country of this terrible scourage — because of the importance of the meat industry to our economy generally — it will be felt by everybody if we begin to lose markets around the world. The clearly defined policy of the Government is to add an extra £10 million to the disease eradication programme.

I welcome the decision of the Veterinary Association to return to work. I believe everybody is relatively happy at this stage. There is a huge job to be done. I might reiterate what the Minister has said himself on a number of occasions, that whether it be the Department, vets, farmers or anybody else, everybody will be expected to pull their weight henceforth because this is our last chance to do so.

I might account now for my stewardship in the last 12 months with regard to land policy and say that there has been marked activity in the whole area of land structure and land policy. About this time 12 months ago there was a Bill in respect of land leasing on the Order Paper. I shall not go into its details today but it was something that had been requested for years by various spokespersons for agriculture and, indeed those outside of agriculture. It was contended that this country, like its European counterparts, should have a clearly defined role in land utilisation. I saw the necessity therefor when I received this portfolio. Since then we have successfully steered that Bill through the House whose provisions now form part of our laws. We are now in a position in which the owner of land and the tenant are capable of making an agreement which, when signed by both parties, will form the law of the land with the great inbuilt security that the owner must get his land back at the end of the appropriate tenancy. Formerly there was great suspicion throughout rural areas in regard to any matter relating to land leasing. Despite the fact that I stressed its importance on numerous occasions there remain thousands of farmers who still appear to think that a long term lease might mean that through one law or another they would not see their land back. I am putting on the record here today that that is not the case. The new law means that, whatever deal is drawn up between a tenant and owner of land, the owner will get his land back on the expiry of the lease.

Land leasing will be one of the fundamental aims of this Government in the future. I have been involved in successful schemes including the group purchase of land. As the House will be aware, the Government decided to abolish the Land Commission last autumn. This decision was taken after several surveys and reports illustrating that it had outlived its usefulness. The Land Commission did good work in the past but we need a different mentality for the future. New schemes were introduced in 1983 and 1984 and they were extremely successful. Under the group purchase scheme a number of farmers pool their resources to buy land and the Department of Agriculture help them in relation to the division of land. This system of land division is much quicker than the system used under the old Land Commission regime. Contrary to what some commentators think the fact that the Government decided to abolish the Land Commission does not mean that we are discontinuing our efforts to set up a better land structure.

In 1977 it was decided to integrate the Department of Lands with the Department of Agriculture and the new policies are similar. So long as land transfer is treated seriously the aims I have outlined will be carried through to a successful conclusion and agriculture will be better able to compete with our European partners. There will be an avenue to allow young trained farmers into agriculture. That has been a pious hope for years. Most of the people who talked about the necessity and desirability of getting young people involved in agriculture achieved little in that area.

The new land section in the Department of Agriculture will continue to deal with the questions of subdivision, consent and so on. They will also continue the group purchase scheme and will deal with the division of commonages. On the Agriculture Estimate last year I voiced my impatience with selfish individuals who hijacked whole townlands vis-à-vis the division of commonages. Since 1942 we have had legislation, which was not invoked, whereby under certain conditions these individuals could be forced to take part in the division of commonages. I have invoked this provision and at the moment about five cases are being processed under that legislation. In the marginal areas this will bring a certain degree of good news. For years people have been frustrated by the lack of initiative and action in this area.

As an agricultural nation we must maintain the right of free sale of land. Neither this Government nor I intend to inhibit that right but at the same time by virtue of our farm size profile and our farm families it is important to give a certain priority to smaller farmers who require more land particularly to young farmers who are highly trained in agriculture. It is difficult to get the balance. On the one hand we must ensure that the owner gets the true value for his land and we must ensure that people who require land get a chance to bid for the land. I have submitted proposals which will be considered by the Government shortly and they will get around that problem to a great degree. It will be a much more enlightened approach than the approach of total acquisition and subsequent redistribution under the old Land Commission. On balance this will give efficient small farmers an opportunity to buy land. They will be given priority over foreigners and large businessmen. The most important requirement for that priority will be that these farmers are using their land well.

The Minister has five minutes.

People unaccustomed to driving through the countryside must feel shocked at the number of totally underutilised farms. Many of the owners are away in England or in cities. Many small farmers requiring land have been looking over the ditches for years at these lands which are providing nothing. That is a luxury we can no longer afford and I propose to take steps to eliminate it. A policy on underutilised land is long overdue and that too will be another prong of the land policy.

On the education side I have been heartened by the number of people who have taken the 100 hours and the three years green certificate in farming. Never in our history have more young boys and girls allowed themselves to be educated for their chosen profession. One of the best schemes ever introduced was the scheme to give an exemption on stamp duty for the transfer of a farm from a father or mother to a son or daughter. This scheme has been outstanding, even better than the two abortive farm retirement pension schemes. It got farms into the hands of young people who are educated, willing and able to work them. Over 4,000 young people have been involved in this scheme and because of it young people are in control of farms and are farming scientifically whereas otherwise they would not have got control of their farms for another five or ten years.

I am sorry that time is beating me. This is a huge subject. Deputy O'Keeffe said that we should pay particular attention to the installation grant. The House will be aware that this has been a hobby-horse of mine for years. My Minister fought extremely hard for this in Brussels to ensure that at least it is optional that a country like ours can take part in this installation premium scheme, which means that we can give financial help to a young person starting off in farming under certain conditions. Time does not permit me to go into this scheme, but it is important and I am totally committed to it to the degree that our national resources will allow us to go. However, we have made a start. Many things are happening in the whole area of farm inheritance, and the profile and age in the next five years will change dramatically. We will have better educated young farmers taking over the land younger, and this country needs that very badly.

I am delighted to have the opportunity of saying a few words in connection with this very important industry. Agriculture at present is going through a state of depression and many farmers are worried that their livelihood might be at stake. An air of despair hangs over the industry particularly in the last two years. The super-levy alone has created major problems for many farmers as they are unable to increase production and keep in line with inflation. These farmers have not the expertise to go into tillage or pigs and the returns from cattle are low in comparision with those from dairying.

The Government tell us that farming incomes increased last year. That may be so in national terms but on an individual basis the average farmer is worse off than he was a year ago and 90 per cent of the farmers are becoming worse off every year. What does the Minister for Agriculture, Deputy Deasy, do about it? Absolutely nothing. For example, take the super-levy. The Minister has done nothing to alleviate the problems of farmers with low quotas. People with hundreds of cows are leasing quotas in a year when other farmers with small supplies cannot get an increase in their quota. That is a scandal when people on small farms are trying to survive while what I call milk ranchers speculate on the very loose arrangements which exist at present.

The Minister's inaction has been referred to by the Deputy from Wexford. He has taken no action at all on the quota system in the last three or four months. He and his Department have failed miserably to help small farmers who have no or very small quotas. It would not require much sense to realise that the producer of over 80,000 gallons should not receive any increase in the quota or be allowed to take or lease a quota, but in this month of May nothing has been done to grant the leasing of quotas to those most in need of them. During February and March the co-operatives preached the cutting back of milk production because if this was not done they could be liable for a levy up to 40p a gallon. The smaller farmer who could ill afford to pay a levy cut back production and the co-operatives ended up at the end of March with no levies. The people who produce 100,000 gallons paid no levy for producing 10,000 to 15,000 gallons in excess of their quotas while the small producer was kept to his quota and was cutting back to bail out the bigger producer.

That loophole remained because the Minister did not act in time. I tell the Minister that many average sized farmers are milking up to ten cows too many this year and could end up paying £3,000 levy at the end of the year unless he does something for them. I urge him to consider taking the following steps: (a) grant leasing of quotas to those who most need them to produce extra milk. Eighty thousand gallons of milk should be enough for anyone and such a limit would allow for fair play for everyone; (b) co-operatives should buy up the available quotas to ease leasing problems and the requirement that the land be leased with the quotas should be removed. People with quotas of up to 80,000 gallons who produce above this level should not be allowed to use flexi-milk to reduce the levy on this milk.

That is another irregularity at the expense of the small farmer and small producer. Flexi-milk should be kept for the small producer who ends up with milk over his quota. That only makes commonsense, but it seems that some people in the Minister's Department have no thought for such people and that is grossly unfair. New entrants who came into milk production last year should be given permanent quotas. That is not asking too much. It is ridiculous that people with hundreds of cows can lease extra quotas and new entrants get only a temporary quota which is limited, and in many cases at the end of the year they end up with a 50 per cent levy on their supply.

The curtailments I have mentioned would allow some milk to be made available to those who most need it. If this is not done farmers may have to dry off their cows in September rather than risk paying a levy. At present they do not know what to do. The Minister should be adjusting milk quotas and not adjusting acres of land. It does not make commonsense that if a farmer wants to lease a quota to, say, a friend eight or ten miles down the road he must also lease the land.

The Government talk a great deal about the land tax and equity. This tax is simply not equitable because it does not take into consideration the income of the farmer, the age of the farmer, the type of farming being done and the farmer's financial position. Many farmers are in an unhappy situation with their bank managers, not through their own fault but because of inflation and poor prices for their produce in the last three or four years. The land tax situation will not help them. Until the Government abandon this land tax farmers will be justified in saying that they are being brought in for unfair measures. It may suit some farmers but if it is not seen to be fair to all farmers it should be abolished.

The farm modernisation scheme has been tossed about by the Government and particularly by the Minister. It was to be phased out at the beginning of this year and replaced by the new scheme but now the old scheme is being extended until the new scheme is ready in the autumn. This is very unfair to farmers in the commercial category who are paid a 15 per cent grant over a period of seven years. That is crazy. If the new scheme had been brought in when it should have been many of the farmers might have been entitled to a cash grant for this year. The 15 per cent grant over seven years was a waste of time and an insult to any person willing to do a building project. All it creates is paper jobs in the Department for the purpose of sending out a few pence every six months. The new scheme was agreed by the Council of Ministers in February but we are told it will not be ready until the autumn. The Minister should state immediately that any farmer undertaking new investments should be entitled to grants under the new scheme provided they are eligible for the work done this year. That is not asking too much.

I appeal to the Minister to pay the grants to the people who were deprived of them in 1983 by the hasty action by the Minister for Finance at the time. People who were guided by the advisory service and were anxious to work hard to earn a living for their families and themselves should not be penalised at the stroke of a pen by the Minister for Finance on budget day. Would any other section of the community tolerate such treatment? The Minister is blowing his trumpet about what he has done about agriculture. We all know what he did. He penalised the farming community, he refused aid from Brussels for the lime, AI and other subsidies and he weakened our position in Brussels to the point where we are a laughing-stock. They say in Brussels that the Irish farmer does not need aid because the Minister rejected all the schemes for which Fianna Fáil fought hard some years ago. We talk about generating employment in the lime and livestock industries yet we are cancelling these schemes saying farmers are so well of they do not need help. We are pennypinching with our most important industry. We give millions of pounds to foreign companies to set up business here, which they will probably leave in a few years time, having squandered taxpayers' money. The people cannot afford to pull up roots and run away like the tomcats which come and set up industries here to get an easy run and make a soft buck. I am all for creating jobs but let us get our priorities right.

The Minister for the Public Service, Deputy Boland, has been speaking about a more efficient public service but giving a grant of 15 per cent, paid twice yearly over seven years, is a ridiculous waste of labour. Take, for example, a farmer entitled to a £700 grant. He would be paid £50 a half year over seven years. That is some incentive to do a job. This is a sick joke.

The Minister for Agriculture may feel that because a farmer is in the commercial category he is developed, but such is not the case. A large number of farmers were categoriesed as developed in 1978 or thereabouts, but because of the recession they did not make any investments or carry out any improvements on their farms. They had to go into the commercial category after six years, and a 15 per cent grant over seven years is no incentive to do a building job. We all know how expensive building is, particularly with the extra VAT imposed by this Government. When the new scheme comes in, I hope the Minister will make provision so that farmers in the category for grant aid will be allowed stay in that category until their development work is done and not have it based on time as happened with the old farm modernisation scheme.

With the deepening of the recession and farmers unable to purchase their own equipment, it is important that we have a strong agricultural contracting service. These contractors have served the farmers well down the years and have been a vital cog in developing the agricultural industry. But they, too, are feeling the pinch of the recession and many of them have gone out of business. This is in part due to the recession and also to the fact that the bigger farmers have provided their own equipment, but we need a good agricultural contracting service for the other farmers, particularly the smaller farmers who cannot afford to buy very expensive equipment. A few minutes ago the Minister of State said there was a ray of hope because people involved in the farm machinery business said, at the Spring Show, that there was a slight upswing in business. There would want to be because business was very bad in the last three or four years. When one takes into account the way this Government are treating agriculture one realises that it will be a very hard haul for this industry.

Borrowing money at hire purchase rates of interest, the cost of oil and the rate of VAT being applied to the agricultuaral contracting business is killing agricultural contractors. I appeal to the Minister to consider applying a low rate interest loan to agricultural contractors to enable them to purchase equipment and to provide a better service for the farming communities. There is nothing worse than going to a bank for a loan and the manager saying you cannot get the loan but that the hire purchase section of the banks will be able to give it to you. That is hypocrisy. In many cases the farm machinery is being seized by the same hire purchase companies which are associated with some of our banks.

The rescue package was a help to farmers but it should be continued for another four years, otherwise they will have to go out of business. It was not the farmers' fault that they ended up with such high loans. Farmers got loans based on their wealth but they had to pay them back based on their incomes, a crazy way for any banking organisation to work. If the banking institutions had based those loans on the income ability of the farmers very few would have got into the trouble they are in today. Who could back up a loan of £100,000 with a farm of 100 acres? Three or four years ago the banks valued such a man's farm at £300,000, £3,000 an acre, and he was given a loan of £100,000 without having the income to repay it. In my humble opinion this was highly irresponsible on the part of the lending institutions.

The banks should be helping the Irish people and not involving themselves in overseas business in which they admit they do not have the necessary expertise. Their first priority is to their Irish clients who helped them make millions of pounds down the years. Giving a 10 per cent loan to the hard-pressed farmers should not be a problem with inflation running so low and it is the duty of the banks to do so. Interest rates should be based on how well an industry would be able carry them and agriculture is unable to carry interest rates of 17 per cent to 20 per cent.

I would like to mention the disadvantaged areas scheme introduced a couple of weeks ago. While many new areas have been included in the disadvantaged areas, there are glaring weaknesses. I would like to ask the Minister why the county boundary was used to divide one area from another. Take, for example, the Tipperary-Waterford border. The Waterford side up to the county border is included but on the Tipperary side, in the Newcastle-Clonmel area, similar land is not included. The same applies to the boundary areas of Cork and Tipperary. The area in County Cork was included, but not the Araglen area on the Tipperary side, or many other areas in South Tipperary. We have been waiting for this scheme a long time and I am disappointed that nobody in the Department checked the plans which included some people but excluded others living 100 yards away, with similar land. I appeal to the Minister to rectify this situation if he can.

Like the previous speaker I am delighted to see the president of the IFA, Mr. Joe Rea, and the president of the ICMSA, Mr. Seán Kelly, doing such a great job for farming. I am very pleased to hear there has been talk about them working together in the interests of farming in the years ahead.

I appeal to young farmers to get involved in co-operatives and to become members of the committees of management. We have the youngest population in Europe and we need young people working on behalf of our farmers in our co-ops. This is big business today.

Milk, beef, beet, sheep and pigs are in trouble and the Minister says he is doing everything for agriculture. I appeal to him, in the national interest, to do something and to stop this pious talk about action. There is very little action, and very few results have been seen from this so-called progressive Government over the last two and a half years. It is sad when there are so many people unemployed outside and in farming that we do not have the courage to put our money where our mouth is, invest in our native industry and create jobs on and off the farm in the national interest. If we do not do this I do not know what hope there will be for the big farmer, the small farmer and the unemployed.

It gives me pleasure to participate in this important debate coming as I do from a constituency that depends chiefly on agriculture. Agriculture is the cornerstone of the economy because directly and indirectly agricultural pursuits employ roughly 50 per cent of our total labour force. Agriculture also provides roughly 35 per cent to 40 per cent of our gross exports and almost 50 per cent of our net exports. All this is achieved by an industry which is the most undercapitalised and the most under-developed in the EC. That is not our fault. The blame lies squarely on the Opposition who were in Government for more than 40 of the past 60 years. They completely neglected agriculture. They did not give agriculture the impetus it required in the swinging sixties and the booming seventies to meet the crisis of the eighties. On our entry to the EC our agricultural industry was very undeveloped. We entered the EC without a sound agricultural policy, a policy which should have been formulated by successive Fianna Fáil Governments. They reneged on their promises to farmers.

The only party here with a background in agriculture is Fine Gael. In 1923 the late Paddy Hogan as Minister for Agriculture appealed for a policy of one more cow, one more sow, one more acre under the plough. He set the headline for a sound agricultural policy which would have meant the economic survival of the country. His plea fell on deaf ears and we entered the EC unable to meet the challenge of the Europeans. Our farmers today work as hard as any in the EC provided they get fair play. The future for agriculture is very bright provided we give it the right direction.

For the past half hour I have been listening to the moans and groans of the Opposition. What did Deputy Byrne's party do to equip farmers for our entry to the EC? Why did the agricultural community not get an opportunity to play their part in revitalising the economy? When European agriculturalists came here from the continent they were wined and dined by our Ministers, but was the leader of the IFA, ICMSA and so on? It is not so many years ago that I started a farmers march from Bantry to Dublin. The farmers walked 240 miles on solid roads to put their case before the Minister of the day. When they arrived in Dublin at Leinster House I was here to meet them and walked with them through the streets of Dublin. The Minister for Agriculture failed in his capacity as Minister to meet that deputation who had trekked 240 weary miles to talk to him. The truth is bitter. I would ask the gentleman across from me, what his party did for farmers during the last 50 years. On that occasion the Minister failed to meet a legitimate delegation of farmers, the salt of the earth, who came to present their case to Leinster House. He left them huddled outside the gates in blankets, in freezing conditions.

If we got a little nearer to 1985 it would be more appropriate.

Some people have short memories. It is high time Fianna Fáil realised the huge efforts our Minister is making in co-operation with his two junior Ministers in pioneering our industry in Europe and realised all the obstacles they must face. The future of agriculture is in sound hands when it is in the hands of Deputy Deasy, the Minister for Agriculture and his two reputable junior Ministers. No one has played a bigger role in formulating and tabulating the farming economy than these three men. Farmers know they are in sound hands. At least the Minister is prepared to talk to the farmers and he is not creating a dictatorial policy. The Minister is willing to listen to the grievances and demands of the farmers.

Deputy Byrne referred to land tax. A reputable farming organisation, the ICMSA, have openly declared that they are in favour of land tax provided modifications are introduced in the Bill. Farmers are willing to pay their way and show their responsibility for the State provided they are not led by wildcat policies and statements from Fianna Fáil.

There are three million people in Ireland today and one million of these are gainfully employed in agriculture and its ancillary industries. A thriving agricultural policy means increased employment and more agricultural industries. To create new jobs outside of agriculture costs £15,000 per job. To keep a man from leaving agriculture costs the State £272. We have a beautiful climate for agricultural development and everything possible should be done to ensure that it is put on a sound footing. I dislike the move afoot in the EC to squeeze out the small farmer. Big co-operatives here and in Europe are getting bigger every day. Small farmers, and indeed farmers in general, are losing contact with their co-operatives. They are now numbers on a computer from one to 6,000. Is this the Ireland that Horace Plunkett envisaged?

What policy had Fianna Fáil in regard to farming when they were in Government? They sat idly by and completely ignored the demands of the agricultural community to build the industry up to a viable position where it could meet and beat its counterparts in Europe. When Fine Gael assumed office, they made an all out drive to ensure——

(Dublin North-West): What about the Labour Party?

The effort can be described as a Fine Gael-Labour effort. They did everything possible to ensure that farming demands would be met. However, our efforts were hampered in no uncertain fashion by petty party policies. It consisted of political scoring and nothing else. There is a vast future for agriculture provided it is given a chance. Our under-utilised land must be more readily available to young, energetic and trained people. Our land and young people are our best, if not our only, hope of solving the serious problems besetting us today. Deputy Connaughton, as Minister of State, has made great strides——

Long strides.

——in utilising the underdeveloped hundreds of thousands of acres that lay dormant under a Fianna Fáil administration for so many years.

There was nothing wrong with the Land Commission but is administration left a lot to be desired. The workers would have done their duty if they had been allowed to do so without political interference but they were muzzled down through the years. We all know who got the land when farms came up for distribution. Unless you were a member of a prominent political party you had very little hope of getting extra acreage. The Minister of State is in charge of that area now and he will ensure that there is fair play in that regard. Fine Gael always maintained great strides as far as agriculture is concerned and provided the necessary impetus to ensure that agriculture would play its part.

I was amused to hear Deputy Byrne talking about the bad times for Irish farmers. On 13 August 1935 a meat exporter from County Monaghan sent 77 lambs to the London market. They were sold for a sum of £118.15.0d. Commission and charges for transport amounted to £19.6.8d., making a gross total of £99.8.4d. Out of that sum, a tariff of £38.10.0. was levied by a Fianna Fáil Government which gave a net figure of £60.18.4d. for the 77 lambs. Today, thanks to the Minister for Agriculture, a farmer in a disadvantaged area with 250 breeding ewes gets approximately £5,025 in EC subsidies. If he has 500 breeding ewes he gets over £9,250. It is a long way from the late Mr. Macklin in County Monaghan——

Was he a Fine Gael supporter?

Deputy Wilson should think twice before he criticises the Government, the Minister and the Department who have set guidelines for future prosperity in agriculture.

I have not criticised anyone, I did not get a chance.

What strides we have made in agriculture since 1935. Facts are facts and the truth is often bitter. Before I conclude I should like to urge the Minister to do everything possible to ensure that disadvantaged areas will be enlarged in a future review because they have been of immense benefit in revitalising and keeping agriculture in a prominent position. He should also restore the lime subsidy because it is more important that the fertility of our soil is maintained to ensure the best possible production.

Under the new livestock breeding Bill the Minister should make provision for a farmer in a disadvantaged area to keep a three-quarters bred bull of high strain to ensure the continuation of his herd. It is very important to give some help to the under-privileged section of the farming community. I know only too well what it is to exist on a small mountain farm. I was born on one. No one need tell me of the rigours and hardships that are endured in trying to make a living out of a small mountain farm.

Deputy Kirk has 20 minutes. I understand he wants to share his time with Deputy Wilson. Subject to the agreement of the House the Chair has no objection but he will be calling on a speaker from this side of the House at 10 minutes past.

I am very glad of the opportunity to speak on this Estimate. Having listened to Deputy Sheehan one would think all was well with the industry but those of us who are in contact with people directly involved with agriculture know that all is far from well. We have difficulty with the milk super-levy, restrictions on grain production, non-existent margins for beef producers, potato gluts and rock bottom prices. That is the order of the day as far as farm produce is concerned. Yet production costs rise.

One would have thought Deputy Sheehan would have had regard to those facts. Those involved in agriculture have to face those facts week in and week out, yet all the Deputy did was berate previous Fianna Fáil Ministers for Agriculture and tell us that the present Minister and Ministers of State are doing great work for the industry. Nothing could be further from the truth. The difficulty the industry encountered with the milk super-levy bodes very ill for the future of the agricultural economy. The implications of a restriction in production for our export markets, the national herd and the beef industry are such that if we are not allowed increase the number of cows in the dairy herd we will not have sufficient stock coming through the production system to supply the needs of the beef industry.

It does not add up that the super levy should have such far reaching implications for the economy. When we bear in mind that our economy was at a relatively early stage of development by comparison with other member states it was particularly penal that the super-levy should have been imposed. All the indications are that allowing for the 1.1 per cent we lost in the blundering over the calculation of the figures, in the coming year a more unsatisfactory position will obtain. The slaughter of cows will accelerate and that will mean a reduction in the number of calves born next year, which in turn will lead to a reduction in the number of yearlings and beef cattle in two or three years time.

There has been a huge investment made in the development of farms. We have been bedevilled by our fragmented, badly structured agricultural set up. Many small holdings with bachelor farmers in charge of them have posed problems as far as our efforts to accelerate production in the agricultural sector were concerned. That has been a major cause of hindrance to our development.

The milk super-levy has been a great blow to small farmers. The only way to deal with ongoing production costs was to increase output and ensure there was a steady cash flow from the sale of milk. We can only wait and see what the future will hold for many small farmers.

I have never seen the Government's policy for the development of agriculture nor do I think any other Deputy can claim to have seen that we will have an adequate agricultural policy formulated by the Coalition.

There are none so blind as those who do not want to see.

They are prepared to throw the children of small farmers on to the labour market. The only outlet they are prepared to encourage is the emigrant ship. The best educated generation of young people are leaving in their tens of thousands to take up employment in London and San Francisco. That is the only prospect open to many young people. The principle of developing a holding to accommodate more people has been thrown out of the window.

Anyone who reads Building on Reality will realise that the Government are not prepared to look at the agricultural industry as a potential area of employment both directly and in the processing and marketing end. Marketing has been the Achilles heel of the agricultural industry for far too long.

This year we have the threat of the restriction on grain production. The news is that cereal production will be severely restricted in this country in the years ahead. At Question Time yesterday the Minister told us that there was one area where there was real potential for expansion and that was the pig industry. We pointed out to him the possibility that would exist for cereal producers if a properly co-ordinated effort was made to develop markets for pigmeat in the US and other areas. There is the ludicrous situation that we do not have a processing plant of a sufficiently high standard to allow us to export to the valuable US market.

A sad reflection on Fianna Fáil Governments.

There are approximately 47 million people of Irish extraction in that country. They would have goodwill towards any products we could supply them with. The Minister and the Government should address themselves to this area immediately. When we look at the pig industry it can be seen that it would be possible to create up to six jobs up and down steam from the primary production of pigs. It is a question of identifying the markets and developing processing plants. It is a question of having the commitment to the development of the markets and to ensure that, when we got a foothold in them, we can meet the demands. The potential of the economy is immense if the Minister is prepared to commit himself.

There was investment in the development of farms. Many farmers must be asking themselves was that investment justified in the first place. Investment was made with the promise of green fields for the industry, but things have gone very sour indeed. There was a huge investment in the infrastructure of farms. All the indications are that it is very doubtful that that investment could be justified, given the percentage return on money invested in agriculture. The same applies to investment in plant and processing facilities. Millions were invested in dairy plants, beef plants and in the creameries. Grant aid under the FEOGA scheme was channelled into them. They are working way under capacity. Unless there is an immediate upturn in agricultural production, and an immediate brightening of the horizon for agricultural products, that investment will prove to have been very questionable.

That is the type of spectre which confronts us. Unless the Minister is prepared to address himself to the problems, we will go further down the river into virtual national bankruptcy. We need a proper, co-ordinated plan for the agricultural industry. I want to share some of my time with Deputy Wilson from the honourable constituency of Monaghan-Cavan which is not without its own unique problems to which I am sure he will address himself.

I should like to deal briefly with horticultural development. Most economic commentators admit freely that there is considerable potential for horticultural development. In many areas, alarm is being expressed at the increase in food imports. We have considerable imports of horticultural products, including potatoes. Some of the figures being quoted are wildly exaggerated and create a very false picture. There is a real potential for turning around those imports and supplying the produce on the home market. I should like to compliment ACOT and An Foras Talúntais on the tremendous work they are doing in the advisory and research fields to help to redress the imbalance.

In recent years we had considerable growth in the mushroom production area. The mushroom industry is concentrated in the main in Wexford, Cavan, along the east coast, in north County Dublin and in my own constituency to some degree. There have been considerable developments in that area and the potential seems to be ongoing. The new production methods which have been developed have worked wonders. The setting up of processing plants with excellent management has helped the mushroom industry to develop. I should like to refer to the serious difficulties which apply to potato production. This is very serious indeed. The very high cost of production and the very low——

The Deputy cannot have his bread and eat it.

It is creating all kinds of difficulties. I will give way to Deputy Wilson.

I will go as quickly as I can through the points I want to make. Some people are saying everything in the garden is rosy. The Central Bank report which has come to hand says that agricultural output in 1985 is forecast to fall marginally from its level in 1984. I am sorry Deputy Sheehan has left the House. I wanted to read that piece of factual evidence into the record of the House for his benefit.

I regret that the Irish Land Commission are being abolished. I regret that such an experienced unit should be ended by the Department. I regret very much that purchasing land has ceased, not because land was not available, but by direct Government decision. I want to speak briefly about an aspect of the co-operative movement which is worrying everybody who knows anything about the origin of the co-operative movement. We have seen co-operative societies - and I will not name them - developing into red in tooth and claw capitalist ventures. As the Minister said some time ago, it is good to make a profit, but it is good to make a profit in a certain way. The word mutuality was predicated of co-operative societies at their start. They were related to the idea of the friendly societies. That is not what we are getting now in some areas. Farmers will be damaged and the co-operative system and movement will be damaged if we do not try to adhere to the philosophy upon which these societies were first established. I would have a great deal to say about that if I had time, but I have not got time.

Farmers have never been praised sufficiently for the efforts they made to increase output. That is something this House should recall. I remember the time when the manufacturing industry was way ahead percentage wise and was getting all the praise, and the farmers were being hammered. That is not the case now and farmers should be praised. In marketing and disposal they are important and will become increasingly important. From the productivity point of view, let us be blunt about it, the farmers deserve well from us. We should see to it that an income supplement is maintained for small farmers, whatever we like to call it. That idea should be maintained so that the maximum numbers can be kept on small farms.

As producers, processors and exporters can we not see to it that the quality of our lamb is maintained? We had a tremendous advantage in the Paris market. Then we began to put in fatty carcases which the French housewife will not have, and which the housewife at home will not have anymore. It is a bit weak for the Minister to say he is appealing to exporters. There should be a strict, tough Government policy not to let inferior products go to a market where we already have a good reputation. The British will take that market from us if we are not careful.

Last year I appealed for an innovation section in the Department. I mentioned various innovations in the agri-business field and I will not go into them again. I mentioned various liqueur creams and mushrooms. I see the Minister wants to develop the vacuum pack business and I hope he sticks with that and develops it. It is a disgrace that £20 million to £25 million worth of imported potatoes are coming in here. A small step has been taken in the right direction. Let us face up to an import substitution business. I was very worried about the butter fat statement the Minister made. I hope he will explain it further to us. Many years ago I asked the then Minister, Mr. Clinton, about protein assessment and payment on protein, and so on. Some of the co-operative societies are testing for protein now. We should have a yardstick. We should not just pay on a white liquid.

Some people were caught under the farm modernisation scheme. There were 250 of them in my own county. They were caught with their trousers down, so to speak, because the Minister for Finance suspended the operation of that scheme on 9 February in his notorious budget. Could we do something about those people who are in serious debt? They were spending money which they thought had been approved by agricultural advisers. The House knows all about that, and I will not delay on it any longer.

I support Deputy Sheehan's appeal for a further consideration of the severely handicapped areas and a further extension of those areas. As the Minister said yesterday, there are problems in all constituencies and all public representatives have these problems.

Regarding disease the Minister appeals again to the veterinary profession and he is asking the consumer, in other words, the farmer, to co-operate. If we do not apply the most rigorous standards in this regard and rid our stocks of TB just as we have almost totally eradicated brucellosis, we will be causing ourselves serious damage. It is practical patriotism for everyone concerned to co-operate to the greatest extent possible in TB eradication.

During the year, CBF experienced difficult times. They deserve the support of this House and of the country generally.

There is an emphasis nowadays on education and training. It is said that within a very short time financial institutions will not lend money to young farmers who have not had basic training and education in farming. That thinking is in the right direction. We should invest as much as possible in education in the agricultural sphere.

The pig industry is very important in my constituency but I regret to say that the news does not seem good in regard to this business. I do not agree with the Minister's suggestion that four or five mass slaughtering places should be established because there is no reason for not applying the most rigorous standards of hygiene in smaller centres in local areas. There are 16 points more I should like to make but the Chair is indicating to me that my time has expired. I thank him and Deputy Kirk for the opportunity of the few minutes I have had.

The whole agricultural environment and outlook is linked intricately with the overall national economic situation. The first prerequisite for agricultural confidence generally is a Government who are in control of a stable situation.

While agriculture has benefited from decreased inflation in the past few years, the whole area of the interest rates continues to play havoc with agricultural development despite considerable respite since 1982. Increased efficiency and levels of production, essential though they are, are not sufficient if our farmers are not rewarded in terms of adequate profits for their outputs at the farm gate. No grants, premiums or Government or EC support structures will ever compensate Irish farmers for just price rewards. Inputs and energy costs and the sheer hours of labour from all members of the farming family demand that just prices be paid for farm products which are so important to us all in terms of wealth creation.

To a large extent prices are outside our control. They are determined at EC level. In the short term the future for some of our main farm gate products is not good. In Europe there is a surplus of dairy products, grain, sugar beet and so on, so we must ask whether we are diversifying sufficiently or whether the EC is holding to its principle of production in areas of greatest natural resource. I doubt if it is. As a country we should watch the situation very closely. From an overall Community point of view is it not good economic sense to maximise dairy and beef production, for example, from the grasslands of Ireland, rather than to rely heavily on the highly intensive production units of continental Europe in which imported grain and feedstuffs are used?

I will deal later with possible areas of diversification. The whole saga of the milk super-levy and the missing 58,000 tonnes of milk has been well aired in this House. I have every confidence in the Minister's negotiating powers to resolve this matter in the days ahead. It is very regrettable that so much energy and dialogue has to be directed to an issue that should never have arisen.

The super-levy has conferred de facto value on milk production quotas which in turn have resulted in a fall off in demand for the Government-sponsored milk cessation scheme in the past few months. This has led to a preference for farmers no longer using their quotas to release them. However, those most in need, namely new producers without any quota in the base year, 1983, or those with inadequate quotas, are unable to compete for quotas. I urge the Minister to formulate another cessation scheme to be funded by the industry, a scheme that would cater for this essential section of dairy farmers.

In being generous to us with the original quota of a 4.6 per cent increase on the 1983 levels the EC recognised our developing position in this area. We must cater for this category now in terms of the future viability of the industry. The people concerned are mainly young progressive farmers, new entrants to milk production who began planning in 1981 and 1982 by buying heifer calves and rearing them to the milk production stage. Consequently, their supplies in 1983 will have been nil or at most minimal in quantity. It must be remembered that those farmers were working to plan and advised by ACOT and the financial institutions in relation to their investment, which was very capital-intensive.

In making a strong case for new entrants, I recognise fully the overall case for limiting milk production due to the surplus situation which, ironically, because of traditional marketing practices shamefully precludes surpluses from reaching Third World countries who are crying out for this food. However, my argument today rests on having the right people doing the job and encouraging the older and less efficient dairy farmers to yield their quotas to those who could make better use of them.

With our national average yield per cow at about 750 gallons, we have a lot of catching up to effect in this area. In Wexford there are 103 farmers in the new entrants category. These farmers have invested £6 million in the dairy industry. On the basis that they would become viable in the next few years by way of their dairy enterprises, 70 per cent of them were in the rescue package. They urgently need a minimum permanent quota of a least 40,000 gallons, the level that AFT consider viable. For this we look confidently now to the Minister and the Department of Agriculture in the form of another cessation scheme which, as I have said, would be funded by the industry.

In a way the super-levy has done us a favour in that it has concentrated the mind of the industry on diversification of dairy products. Home produced cheeses, yogurts, milk drinks, ice cream and so on continue to increase their share of space on the shop shelf but there is still a long way to go. More milk could be diverted towards beef cow herds and I should like the suckler cow premium of £70 to apply throughout the country instead of in the disadvantaged areas only. This in itself could result in the release of quotas permanently to those in need of them.

Due to the good export outlets and the success of the APS scheme, 1984 was a reasonable year for beef production. Our unhealthy dependence on intervention has been reduced by APS. However, since Christmas the situation has been very difficult for beef producers due in part to the unilateral restrictions by Canada on our beef export trade. Ireland and Denmark supplied more than 20,000 tonnes of beef to Canada in 1984 but for 1985 our quota has been restricted by the Canadians to 2,700 tonnes. The Minister recognises that this is unacceptable and through GATT he is negotiating to have the situation redressed. Already there have been improved offers and we await with interest the final outcome.

A national breeding programme for cattle is essential. Agriculture accounts for 25 per cent of our total exports. We are a net exporting country and cattle exports represent 19 per cent of the total. It is of vital interest to ensure that the quality of cattle produced meets the demand of the market and rewards the producer. The need to breed a specific product for a specific market is now recognised. The Control of Bulls for Breeding Bill has passed the Second Stage. I commend the Minister of State, Deputy Hegarty, the Minister himself and all those concerned with that Bill on its introduction. It is legislation that is long overdue and which will have a tremendous economic implications for our cattle industry. Bearing in mind that eight out of every ten of our beef animals are exported, we must use the best genetic material available and continually select the superior bulls for breeding purposes.

The advent of the super-levy will bring about greater specialisation. We are unique in that 80 per cent of our beef is produced from dairy herds. To date that specialisation has not been evident but we will be very careful about our breeding stocks in the future. An increase in the quality of the product, namely beef, will bring about a greater return to the producer which in turn will, allow for an overall decrease in subsidisation due to the independence and viability of the operation.

Earlier, I mentioned diversification briefly. It will be the key to the future in agriculture. The day of relying on the production for markets already in surplus is over. We have recent word of a greater amount of flax being grown here. Indeed, the bright yellow fields of oilseed rape now span our countryside, with new cereals and tillage crops. The mushroom industry, tomatoes, biomass, all these aspects have been touched on here by previous speakers.

The horticultural area was worth £74 million at the farmgate last year. We had investigations into the feasibility of certain employment creating projects in rural Ireland in the line of horticulture. One of these, by the Tagoat Community Council in County Wexford, funded, incidentally by the youth employment levy, is looking into garlic production, horseradish, organic foods, dried floral material, modular transplant propagation techniques versus bare-root plants, the multiplication of ornamental plant bulbs by twin scaling — a new process in this country. The potential list is endless. This group have produced an excellent report and must be supported all the way. Other groups must follow them. Horticulture is labour intensive and an import substitution area — two major factors in fighting our dole queues.

Recently, a group in Wexford, Agrigold Limited, started an agribusiness based on contract vegetable production with farmers. The secret to their success and the future growth in this area will be the proper marketing of their product. In fact, the whole horticultural industry is handicapped through lack of consistent and modern marketing techniques. Let us hope that the interdepartmental committee of Ministers of State viewing the import substitution and added value possibilities of food production here will have something worthwhile to report and, indeed, to report soon. Let us hope that the National Development Corporation's brief in relation to equity involvement, together with the IDA's capital grant schemes will allow an ordered development of an industry with immense possibilities and potential. I understand that horticultural producers are now organising themselves nationally. That is certainly timely and to be commended.

The soft fruit industry in the south-east corner needs immediate attention from them. Ninety per cent of soft fruit production here is concentrated in Wexford, Kilkenny and Waterford. Traditional contracts which perhaps have been taken for granted for too long will no longer be available. The importing of soft fruit pulp from Eastern bloc countries and New Zealand continues, with little evidence of the European Community's resolve to sort the situation out. We have fruit pulp for yoghurt production here under franchise. This fruit pulp is imported. Yet the south-east is ideal for strawberry, gooseberry and blackcurrant growing. Apparently, the wrong variety of strawberry is grown here for the yoghurt industry and the right variety is such a poor cropper that farmers are not keen to take it on. Tremendous research and work in this area has been done by the institute in Clonroche, County Wexford. The yoghurt market alone has a minimum annual import bill of £2 million in fruit syrups.

Efforts to set up companies here to supply the home market in these industries must receive enthusiastic and full support from all Government agencies. The potential for yoghurt, assuming franchise difficulties can be resolved, in ice creams, desserts, fruit, dairy drinks and jam is enormous. However, the industry needs co-ordination, research and development and feasibility grants and modern marketing techniques applied to it. Yet again, we have been complacent for too long. We can no longer afford to sit back and let things roll along.

Apart from taking the soft fruit industry by the scruff of the neck, vegetable production, marketing and supply is a national disgrace. We should be self-sufficient for most of the year for our basic requirements in this area. Yet, here in Ireland we will import £30 million of frozen potato chips in 1985. Again, we have not grown the variety of potato that is suitable for an indigenous frozen chip industry, the Pentland Dell. This at last is being tackled and looked after. Under the guidance of our Minister of State, Deputy Hegarty, the Irish Potato Farmer's Co-operative have been set up. To date, they have 13 local co-operatives throughout the country and have themselves raised a commendable £100,000 in equity capital. This, together with £150,000 provided by the Government last year and this year, should mean a very viable co-operative.

The co-operative, taken in conjunction with the legislation which was passed through this House last year in relation to the registration of growers and the grading and marketing of potatoes, will surely point the direction of the potato industry in the future. The co-operative plan to bring order and balance to a market plagued by gluts and famines to date and to market branded, high quality, graded potatoes to the best advantage to both the producer and consumer and to secure the domestic market for Irish grown potatoes. How have we waited so long? This year, for the first year in this country's history, virtually, we have imported no potatoes. Tremendous credit is due to the Minister, Deputy Deasy, and his Ministers of State for getting us to this position. As I said, the only question must be, why has it taken so long?

Hear, hear.

A mention of disease eradication is essential because it has such an important part to play in the viability of farm operations. It deserves serious consideration. We must note with pleasure the resolution of the initial difficulty with the private veterinary practitioners in relation to the three year programme of TB eradication recently announced by the Minister. It is essential that the Minister has proper control of the scheme, while respecting the rights of the structures of private practices. However, and this cannot be stressed often enough — Government programmes for eradication of animal diseases owe no veterinary practitioner a living, nor can they be treated as the bread and butter of practices, to be with us interminably. Having said that, we must seriously question whether what we are trying to achieve is attainable.

Is it actually possible to eradicate bovine TB? Has any other country done so?

They have.

The answer must surely be no. Have we ever defined what we are trying to achieve? What will be an acceptable level in our national herd? The importance of coming to terms with what we are doing should not be under-estimated. The economic implication to our beef export industry should not be passed over lightly.

In the future, levies of one kind or another will not be the only way of controlling surpluses. Little progress has been made in the last 30 years, despite the up to £1 billion price tag in relation to disease eradication. Farmers have now been asked to pay an increased levy for one year, to yield £7 million of the £31.5 million which this years' portion of the scheme will cost. A staggering £85 million will be spent over three years. We have to demand better value for the taxpayer than heretofore. The Minister now has control of the scheme. The next step is to ensure its proper management and administration.

The tuberculin test is a field test which possibly reached the limits of its usefulness in 1977 to 1978. It was only intended to test herds, not individual animals. We expect too much of it and, for a start, should immediately consider culturing our own strains, rather than continuing ad nauseum to use British and Dutch serum in various strengths and combinations. I spoke at length in this House on this topic on 31 October last and I do not intend to repeat myself. I refer to the situation in relation to research, epidemiology and the dubious practice of publishing figures of the incidence rather than the prevalence. I stand over what I said on that occasion. The whole area of calves sold from infected herds has been shown to be a major source of the spread of TB. The calf subsidy scheme has helped in allowing the tracing of calves. Only one herd number per unit should be allowed when cattle are mixing. The testing programme just started for 1985 is, like other years, based on the veterinary practitioner's financial year, rather than on the calendar month most suitable to test. Surely consideration of testing the high risk area of dairy herds, when the cattle are housed in the autumn and winter months must be given. This would save the problem of testing contiguous herds and would also test the cow at a time considered to be one of least resistance to infection — pre and post-calving. The plan should receive serious consideration, especially for chronic herds. I am delighted with the news of the arrival of computers in the Department of Agriculture and contact with DVOs through a central unit in Dublin.

Finally, I would like to refer to our national horse board, Bord na gCapall. I am amazed that no one else has tackled this subject today, but I realise time has been short. I am gravely disappointed with this board's performance to date. Despite some individuals who are excellent, the total performance of the board has to be rejected. They are continuing to fail in discharging their responsibility to one of our nation's flagship industries. They have turned their backs on the small breeder, the one or two mare owner, the backbone of our half-bred industry. Their treatment at the outset of the Non-thoroughbred Brood Mare Owners' Association underlines my point. When the board decided to set up a breeding committee, they ignored this primary body for the half-bred mare. A breeding committee — one might ask for what? That remains to be seen. Yet, they ignore this major association in favour of more commercial interests.

The half-bred mare owner is an endangered species — both the owner and the mare, as Freshford has proved a more viable economic option for many, rather than struggling on unaided. The £15 foal subsidy made no one up, but at the very least it was a vote of confidence in the future of an ailing industry. If the small owner is not looked after quickly the farmer who has a mare on his land for the love of the horse, the farmer-breeder who has generations of experience sifted in his head, who has forgotten more than any of the rest of us could ever learn, if they are not supported, our valuable showjumping and export industry is finished because it has no raw material, no foals. The live foal figures are declining annually.

If the Irish draught-type mare does not survive to cross with the thoroughbred horse, then the conformation, bone and soundness for which the Irish half-bred has had worldwide success will be gone. It is up to the Government to take stock of the situation now and to insist that the board, to whom they devolved responsibility for the industry, discharge their obligations.

The move to introduce Hanoverian blood into our stock has had a very mixed reception. There are those who support it but, frighteningly, experts with years of experience who are household names have come out very strongly against it. All I can reiterate is that we have conquered the showjumping world with our cross-bred. The Irish teams have done us proud with what we have managed to keep at home, namely, the culls from the export market, and all of this without a national breeding policy — in fact, a highly questionable policy of often breeding mares that were fit for nothing else. On the other hand, the Germans have had limited success from a policy of intense culling of young stock. Therefore, the German horses that have reached the top of the showjumping world — and they are good horses — would be the result of hand-picking the best. We now decide to introduce these horses to our breeding stock without any rational throught on a breeding policy. The people to whom we have entrusted our great industry should be asked what they are doing and why they are doing it.

I am calling on the Minister to conclude.

(Limerick West): On a point of order, this morning I referred to the Minister making a statement with regard to the disbanding of CBF——

The Chair cannot allow the Deputy to make a second intervention.

(Limerick West): The Minister asked me to quote the reference.

That does not empower the Chair to walk through Standing Orders. I am calling on the Minister to conclude.

As a matter of order in the House, the Minister asked for something and the Deputy is giving it. Surely it is a point of order?

Let the Deputy hand it to me——

The Chair cannot allow these private arrangements.

(Limerick West): The statement is——

I am sorry, I cannot allow the Deputy to continue.

(Limerick West): The Minister said in public and in the presence of potential——

The Deputy may not ignore the Chair. He is out of order and he must resume his seat.

(Limerick West): The reference is the Irish Farmers Monthly, March 1985, Vol. 9, No. 3 and I quote: “He has in public and in the presence of potential foreign customers wondered aloud if CBF is doing a worthwhile job or if it should be scrapped altogether.”

The Deputy is disorderly. He will resume his seat or else leave the House.

(Limerick West): The Minister asked for the quotation——

I am asking the Deputy to leave the House. Will the Minister please conclude the debate?

The Minister has undertaken to allow me some minutes to speak.

I am sorry, Deputy. The Chair is bound by the orders of the House. I am calling on the Minister to conclude.

I am sorry that Deputy Coogan could not be given an opportunity to speak. It has been a very detailed and informative debate and I think that most Deputies who wished to do so got an opportunity to voice their opinions. There have been some very constructive contributions.

There have been attempts to muddy the waters in regard to expenditure on agriculture and it has been said that as much as £200 million has been taken out of agriculture. That is ludicrous. Schemes are constantly changing. Some are not renewed but other new schemes are brought in. One can do virtually anything with figures to suit one's case but at the end of the day the statistics speak for themselves. As I said this morning, for the past three years agriculture has been particularly healthy and it has been a time of considerable growth——

Is the Minister serious?

——in terms of real income. The figures are there to prove that. We have recovered from the disastrous period of the late seventies and early eighties. As I pointed out, expenditure on agriculture in the current year is 9 per cent up on 1984. It is true that certain schemes and services funded by the Exchequer which had served their purpose are being phased out but Deputies opposite are conveniently forgetting or ignoring that a very high proportion of expenditure in agriculture also arises under EC schemes, much of it fully financed by Brussels. The total sum spent by my Department in 1984 was over £1,400 million, including some £700 million from EC funds and £350 million on intervention purchases. Corresponding figures in 1982 and 1983 were £800 million and £1,130 million. As Deputies will see, there has been a huge additional expenditure.

Deputy Noonan said that expenditure on improving the beef herd had dropped considerably. There is a simple reason for the fact that there was a certain drop, namely, that the calved heifer scheme has been discontinued. It was brought in for a certain period and that period expired. Therefore, the expenditure did not arise in 1985. Unfortunately that scheme was not the success we had hoped for at the time of its introduction. It was unfortunate it did not lead to any significant growth in the national herd, if it led to any growth at all.

Reference was made to the necessity to increase the amount of beef processed here and I gave figures to show that the amount of processed beef is increasing enormously. Last year it increased by 30 per cent as compared with 1983. There has been an enormous increase in the amount of Vac-Packed beef exported and this has had beneficial effects. It has meant better prices for the producer. In addition, there is a tremendous labour employment content.

Reference was made to the disease eradication programme. I should like to thank Deputies who have been so positive in their comments. Everyone realises we are on the threshold of making a major onslaught on the disease and I hope we will get it down to manageable proportions within a few years. To talk of its absolute extermination is probably not realistic. Ireland is not the only country with the problem of bovine TB but other countries have brought it under control or within reasonable limits. There are still severe outbreaks of bovine TB in Britain, Northern Ireland, in the western regions of France and in other parts of Europe. It is not a problem solely confined to Ireland but the incidence here is far too high and it has been far too high. We cannot be complacent about this matter. We have got to get rid of the disease. Too many farmers have been ruined financially because of the decimination of their herds due to TB. I wish to make it clear that I am going to be as strict in the implementation of the rules where members of my Department are concerned as I am with everyone else, whether they be farmers, dealers or veterinary practitioners. I will be just as strict. I want to see any slipshod practices that may have existed in the past in any phase or in any sector of the operation of the scheme eliminated. I want to make that quite clear.

I might point out that I do not take kindly to representations from Deputies or politicians in general in regard to people who have blatantly contravened the disease eradication laws. These people cannot be shown any mitigation if they go out to cheat the system, thereby propagating the spread of the disease, ruining people financially, causing the economy enormous damage. They will have to be dealt with in a very firm manner. I do not take kindly to representations asking that a case be not proceeded with. I will not accept that type of representation and that applies to all politicians on either side of the House.

Deputy Avril Doyle bemoaned the fact that the additional headage payments for beef cows were confined to disadvantaged areas. I might point out that we are precluded from paying such headage grants throughout the country under EC regulations. We are allowed to give an additional payment of that type within a disadvantaged area only. If it were paid nationally it would be construed as a national aid which would be contrary to EC rules. As much as we might like to have it applied nationally, for those reasons it is not possible to do so.

Deputy Doyle also referred to the difficulties created in meat plants by the refusal of the Canadian Government to allow a free flow of cow beef from this country into Canada, as was the case heretofore. Unfortunately, they put a very strict quota on the amount of beef going from this country to Canada but we have been able to improve considerably on their original proposition. The final offer of 10,600 tonnes will reasonably satisfy our meat processors and should not impose any undue hardship. There had been warnings throughout 1984 from Canadian sources that they were unhappy with the levels of exports from this country which were creating domestic problems for their beef industry. The fact that they were seeking a curtailment was not a major surprise but the extent of the restriction was most unfair and unjust and I am glad to say that a compromise has been reached.

Deputy Wilson referred to the scandalous situation here regarding the quantity of fat on our lambs and sheep, lambs in particular. I totally agree with him. I keep impressing on people that they will have to do better in that regard. The Department of Agriculture, in conjunction with ACOT and An Foras Talúntais are constantly bringing in better quality bred ewes and rams in order to tackle that problem.

I would not let them out of the country, block them.

As I said in my statement earlier today, inferior exports have damaged our reputation abroad. Let us not pretend that that is not a fact. The sooner people adopt a responsible attitude in that regard the better. I would not be averse to the suggestion that we see to it that such rubbish cannot be exported, giving the industry and the product a bad name.

Why did the Minister not agree to the IFA classification scheme, as proposed?

We are endeavouring to get such a classification scheme brought in through the aegis of the EC. We are talking about that matter at present. As the House will be aware, it was brought in last year with regard to beef and now we are asking that it be introduced for lamb.

Deputy Wilson also referred to the flat payment rate for milk. I explained in great detail this morning the problems obtaining there. The legislation is really outdated with maximum fines as low as £10 which are not realistic in present day terms. It is 1924 legislation. I have had a group in my Department studying the situation for some time past in conjunction with the Irish Dairy Council. I intend to update the legislation to ensure that realistic penalties are imposed for people who do not comply with the rules, in that they should not be paid for butter fat and protein content.

Deputy Wilson referred to the plight of the bacon industry, the EC expression being the pig industry. The pig industry is in a very depressed state throughout the EC and in the United States for that matter. Deputies may have mistaken something I said yesterday in reply to a parliamentary question. But I pointed out very clearly this morning that I was not tied rigidly to a certain number of centralised slaughtering units, or to a figure that each of those slaughter units should kill. The figure of ten such slaughter units throughout the country has been mentioned with a lower limit of 6,000 pigs a week per unit. I said quite clearly this morning that there should be room for greater flexibility, that if people wanted to kill fewer, why not? If their operation was hygienic and up to US export standards — that is the highest standard we can hope to attain or that is needed to be attained — then that is quite all right. We should not be too rigid in that regard. Indeed, it might frighten off some potential investors if they thought the minimum sized unit they had to build was for 6,000 pigs a week. They might feel they needed 2,000 or 3,000 only and that they could do a very good job at that level. Six thousand is a guideline only and I would not regard it as being rigid.

Deputy Avril Doyle was very concerned about the problem relating to imported potatoes and vegetables and the fact that we import so much processed potatoes and potato products. I am now well aware from the IDA that a number of people have already invested in projects to produce the very type of product at present being imported. Quite a number have been set up in the past year since the matter was highlighted and I am hopeful of considerable progress in that direction.

Deputy Avril Doyle's comments on Bord na gCapall were pointed and definite and I will be bringing them to the attention of the board. It is very worrying that a number of people are not happy with the direction in which the industry is going.

I share Deputy Noonan's concern about the delay in the price fixing negotiations this year. Unfortunately this has become a fact of life, year in year out. In some years negotiations have not been concluded until the month of June resulting in our producers suffering quite considerable losses. This year those losses are confined almost totally to the milk sector but are still fairly considerable. I hate to think what the price negotiations will be like when we have 12 members of the Community. They will become very cumbersome and difficult. Perhaps some improved mechanism will be applied before the Spaniards and Portuguese join. Such improved mechanism would be desirable because it is not good enough that we should encounter such major delays each year.

(Limerick West): What about commencing the price negotiations earlier?

That was mentioned at the Council of Ministers previously. It is one of the many suggestions which will be considered. We can hardly hope to continue the present situation particularly with an increased membership.

Deputy Doyle spoke about the desirability of a national scheme for the beef cow herd but that is not possible because it would be a national aid.

I share Deputy Noonan's concern about the effects of the co-op milk dispute. It is a very serious matter. There are two points of view. One is that it is a matter of free trade and that no restriction should be put on free trade, that people should be entitled to join another co-op if they wish. On the other hand, there are very serious implications for employment. I would be extremely concerned if I thought that a take-over by one co-op could lead to the closure of the operations of another co-op. There could be considerable unemployment. I hope that commonsense will prevail. I have approached the umbrella organisation of the co-operative societies, the ICOS, and requested them to intervene. They have assured me that they are endeavouring to bring the two sides together and to hammer out a solution. It would be most unfortunate if we had job losses as a result of a dispute.

We need very strong leadership in the ICOS.

Yes, we have that. It is a very useful body. I hope their mediation will be successful.

Reference was made to the abolition of the Land Commission and the possibility that it would lead to "people with fat cheque books" coming in and buying up a considerable amount of the land of Ireland. A new land policy will be brought out by the Government in the coming months and the Minister of State, Deputy Connaughton, is very actively involved in drawing up this policy. Purchases of land will continue to be controlled, irrespective of whether the Land Commission exist in their present form. Certainly there will be provision for landless people, or people who have very small holdings, to be given preference when it comes to competition in the open market.

Deputy Noonan mentioned the possibility of arranging bovine TB testing by geoghraphical areas instead of district electoral divisons. We always seek to improve disease testing arrangements and we will not be restricted by DED boundaries if that helps to advance our progress. However, records are computerised on a DED basis and the more we proceed with the use of computer technology the more difficult it will be to go outside established boundaries, such as DEDs.

(Limerick West): Diseases do not know any boundary.

We follow the disease as it passes over a boundary. There is no problem in that regard. Deputy O'Keeffe referred to proposed changes in disadvantaged areas and thought we were adhering to county boundaries. This is not the case. The latest review was the third review as distinct from the original scheme and it was based on this occasion on townlands rather than DED areas, as had been the case previously. The position must be considered in the light of the criteria laid down by the EC directive.

Deputy Walsh said that ACOT should give advice to the 100,000 farmers not on the priority list. We speak in the national plan about priority for people who could benefit from extra attention from the ACOT advisory services. There are some extremely good farmers who could almost advise the advisers, so successful are they. Good Irish farmers are as good as if not better than those anywhere in Europe. Then there are people who through age or for other reasons tend not to listen to advisers and not to avail of their services, despite all efforts. We have an in-between group who obviously could benefit from some extra attention and we have asked ACOT to pay particular attention to that group, but not at the expense of the other groups. They will continue to get attention. There is no discrimination in that regard.

I wish to clarify a matter regarding the milk super-levy. In reply to a question yesterday regarding people who enter the milk cessation scheme I made the point that they should be free to enter into milk production again once the term of the super-levy system terminates in about four years time. We will have to see how the super-levy system operates. There could be a difficulty if quotas have been taken up — by and large, they will be — and there is a continuation of the super-levy system. Hopefully that will not occur. Unfortunately it is an eventuality which we must look out for.

Deputy Noonan spoke about Thatcherite policies in the Cabinet——

(Limerick West): Everybody knows that.

——restricting the growth in agriculture. There are no such Thatcherite policies in being. There never were and never will be. It is a change from the smear that the Labour Party are restricting investment and growth in agriculture. It is going from one extreme to the other. The truth lies somewhere in the middle. Attitudes are very sensible. The Minister for Finance has shown considerable sympathy, commitment and assistance to the agricultural sector.

Agriculture has lost enormously since this Government came into office.

(Limerick West): The Minister is not dealing with reality.

I would give the Minister for Finance every credit for his assistance. Agriculture is in a very healthy state. We have had record prices in the beef sector and tremendous expansion in output, especially in the value-added content. Of course there are difficulties, as there will be difficulties in various areas every year, and it is our job to see that those difficulties are overcome.

The Minister is out of touch.

I thank everybody who contributed to the debate, a most useful exercise. I am sure it will help the progression of agriculture.

Question put and a division being demanded, it was postponed in accordance with Standing Order of the Dáil No. 123, as modified and in accordance with the Order of the House made today, until 8.30 p.m. on Wednesday, 15 May 1985.