asked the Minister for Agriculture the total tonnage and value of (a) meat and (b) butter held in intervention in the State at the latest date for which figures are available if the Government has any plans to dispose of all or part of these foodstuffs; and if he will make a statement on the matter.
Ceisteanna — Questions. Oral Answers. - Intervention in Beef/Butter.
9.
Proinsias De Rossa
On 30 November 1986, intervention stocks of butter and beef in this country consisted of 114,000 tonnes of butter valued at £285 million and 111,000 tonnes of beef valued at £286 million. A range of disposal measures exist in both sectors for disposing of intervention stock. These include subsidised exports, food aid operations, subsidised butter for hospitals and social welfare recipients. All along, I have been pressing at EC level for a more effective de-stocking programme in order to restore balance to the market.
One of the programmes put forward earlier this week by the Commission in Brussels was that they would spend, over a period of three years, £3.2 billion to get rid of one million tonnes of butter over the next three years. We trust that that programme will be implemented, which will ease our difficulties here considerably because the disposal of stocks is essential.
Sales of beef out of intervention have been very buoyant in recent times. The decisions taken by the Council of Ministers earlier this week included action to limit the further growth of surpluses in the milk and beef sectors, approval for the commission's intention to undertake an accelerated disposal programme in the milk sector over the next two years and, in order to reduce sales to intervention, an increase in the social butter subsidy from 29p to 66p per pound. This subsidy is paid on butter sold to those in receipt of social welfare assistance.
Proinsias De Rossa
I missed the figure with regard to beef; would the Minister say what was the total tonnage of beef?
It was 111,000 tonnes.
Proinsias De Rossa
Would the Minister indicate why there was such a substantial increase in butter tonnage in intervention while there was a marginal increase only in beef? Could the Minister indicate whether all of the beef and butter in intervention or held in stock here in Ireland is actually produced here, and whether the cost of holding these products in storage is borne by the Exchequer and, if so, what is that cost?
There are three questions there that I am trying to answer as best I can.
Proinsias De Rossa
I am trying to assist Deputy Leonard.
The first is about the reason for the increase in stocks. That is the underlying problem for the difficulties we had which had to be dealt with this week in Brussels, the massive build-up of butter stocks to 1.3 million tonnes. The Deputy asked why they built up. There are a number of reasons. One is a substantial reduction in the consumption of butter in the Community. Britain is probably the largest market in the community for butter sales. Consumption of butter in Britain has more than halved in the past ten years and consumption of butter even in this country has dropped considerably with the advent of easy spreads and other products. That is the main reason.
The second reason is that world markets for all practical purposes have collapsed and we find it very difficult to sell butter on the world market. The New Zealanders and the Americans are extremely competitive. They are virtually giving it away. World markets are in a dreadful state at the moment. That is the second reason. I suppose another reason is that people are being advised by heart specialists and other medical people not to eat butter. Lack of consumption is the main problem.
Proinsias De Rossa
There were two other points.
The Deputy asked the amounts of butter and beef stored in this country. I am not aware whether any foreign butter or beef is stored here, although they could be. Incidentally, we have 114,000 tonnes of butter stored in this country in intervention and we have 43,000 tonnes of butter stored in Belgium and Holland.
Proinsias De Rossa
And the cost to the Exchequer?
That is a separate question. I will try to give the Deputy the information in the next few days. We have to pay a certain amount of the cost, but the Community reimburses us a portion of it but not all. There is a cost.
All the measures outlined by the Minister are for the disposal of this surplus. Have the Council of Ministers any plans at all to encourage processors not to convert milk into butter and to convert it into products for which there is some market and uptake? Apart from not eating it, we are making too much of it.
We got an undertaking from the Commission that we would get favourable consideration for projects which converted milk into products which are not in surplus in the Community, soft cheeses, for instance, which can be sold on the world market.