asked the Minister for Agriculture and Food the plans he has to substitute imported food products with Irish produced goods.
Ceisteanna—Question. Oral Answers. - Food Import Substitution.
As the Deputy is aware this Government attach special importance to the development of the food industry. This is highlighted by the widening of the functions of the Department of Agriculture and Food to include food and the establishment of two special offices of the food industry and horticulture represented by my two colleagues here. The House will be aware also that the Taoiseach announced this morning the redesignation of my responsibility as Minister for Agriculture and Food.
In approaching the problems of agriculture and food production, import substitution will be an important element. I should point out, however, that a number of reports in recent years have concluded that a small proportion only of our food imports can be replaced by home production and that we should concentrate on those areas where import substitution is most practicable.
The Government have identified horticulture as the main sector where success can be achieved. The new Minister of State will concentrate on implementing Government policy for the development of horticulture so that the industry may increase its share of the home market and, in time, develop exports. A particular challenge is the replacement of the 36,000 tonnes of frozen potato chips imported into this country last year. I am pleased to say that the Industrial Development Authority have recently approved a grant-aid package for an £18 million investment project for the production here of 30,000 tonnes of frozen potato chips for the home and export markets.
My Department operate a number of schemes to improve the production and marketing of potatoes and vegetables. There is, however, an urgent need for greater co-ordination within these sectors to meet modern market requirements with emphasis on providing well-presented high quality produce in continuous supply all the year round.
In the food area generally, the IDA continue to seek out opportunities for import substitution to bring to the attention of firms in the food industry. Substantial grants are available from the IDA for projects aimed at import substitution and many of these also qualify for further grant-aid from FEOGA under Regulation 355/77. In this connection, I announced last week a £15 million EEC aid package for the pigmeat industry over the next three years. This package will help to finance the rationalisation programme for pigmeat slaughterhouses, which is designed to make the industry more competitive on both the home and export markets.
As the Deputy will appreciate, EEC rules governing free trade limit the action Governments can take to restrict food imports. However, these same rules enable us to export large quantities of food to other countries. In 1986, our export earnings, including transfers from the European Community in respect of market support measures and so on exceeded £3 billion compared with imports of just under £1 billion. While everything possible within EEC rules will be done to help Irish industry to compete with imports, in the final analysis import substitution will be achieved only if those in the industry are able to compete successfully with imports in such areas as price, quality and delivery performance.
I might add that my two colleagues who have responsibility in respect of the food and horticulture sector will have a major role to play in this area. Because this question overlaps into those areas on this occasion I am dealing with it, but the Deputy's question relates to matters in respect of which my two colleagues will have specific responsibility in the future.
May I avail of this opportunity to congratulate the Minister and his two junior Ministers on their appointment? In particular I should like to compliment the Minister of State, Deputy J. Walsh, who was an office colleague of mine in this House for many years. His promotion is well deserved.
We are always seeking new members particularly when they are of the calibre of Deputy J. Walsh.
Would the Minister agree that perhaps up to £200 million of the £500 million worth of imported foods to this country each year could be substituted by home-produced foods, which is no small figure? What plans has the Minister to pinpoint areas where import substitution could take place? Furthermore, would he agree, particularly in major urban areas, that it is not merely a question of the availability of high quality goods at a reasonable price but also a question of the marketing strategy on the part of his Department? Will the Minister's Department, in conjunction with the Department for Industry and Commerce, become involved in a high-powered marketing campaign in urban areas to draw housewives attention to the need to concentrate on purchasing Irish goods which is sometimes overlooked?
The Deputy will appreciate that the issues she raised are far-reaching, of fundamental importance and could raise a number of issues to which I could not reply in detail in the course of a parliamentary reply. That being said let me assure the Deputy that these matters are already being addressed by way of liaison between myself and my colleague, the Minister for Industry and Commerce, so as to co-ordinate the functions, some of which operate under the aegis of the IDA at present and which will be transferred to my Department. Second, the market analysis of the kind to which the Deputy referred will be a major function of the new responsibility of my Department along with my two colleagues. I agree it is an important matter. The Deputy will also agree that while she is concerned initially with import substitution, and that the two go hand in hand, penetrating export markets is the best way of creating the base for domestic outlets as well. I sympathise with the Deputy's case and it will be a fundamental priority of our departmental role henceforth.
Like other speakers I should like to wish the Minister and his two colleagues well, particularly the two junior Ministers in their new role. The question I want to pose relates to food imports. Approximately three years ago in this House the question of horticultural imports, especially their processing, was raised and, because it was raised in the House, received widespread media coverage which seemed to have the desired results. At present we have approximately 1,000 tonnes of frozen peas in our cold stores while at the same time being the victims of what I consider to be dumped products from the United Kingdom, products being offloaded on us because of a temporary over-supply there. I would like my colleague in the opposite benches——
Will the Deputy be brief as I wish to allow the Minister to reply, before I pass on to Priority Questions?
——to highlight this weakness, especially having regard to the merchants involved. After all, it is not British people who are sending the stuff in here, it is Irish people bringing it in. There is no need for it. The fact that this is happening is upsetting two major outlets. I would like the Minister to take the action which we took three years ago, which was successful.
I take the Deputy's point.
I must now pass on to Priority Question No. 24.