Private Members' Business. - EEC Farm Price Negotiations: Motion (Resumed).

The following motion was moved by Deputy J. O'Keeffe on Tuesday, 23 June 1987:
That Dáil Éireann calls for the completion of the current round of EEC Farm Price negotiations and the attainment of the following objectives:—
1. Reasonable increases for farm products.
2. Protection of the Market Support System.
3. Full Green Pound Devaluation.
4. Total dismantling of MCAs.
5. Measures to encourage the expansion of the Beef Cow Herd.
6. Reclassification of existing less severely handicapped and mountain sheep areas.
Debate resumed on amendment No. 1:
To delete all words after "That" and substitute the following:
Dáil Éireann supports the efforts of the Minister for Agriculture and Food to have the negotiations on EEC agricultural prices for 1987-88 completed as quickly as possible and in a way that best promotes the development of Irish agriculture.
—(Minister for Agriculture and Food.)

Acting Chairman

Deputy Durkan was in possession. I would remind him that he has 29 minutes left.

With the permission of the Chair I propose to share my time with my colleagues Deputies Crowley and Hegarty who each wish to have five minutes.

Acting Chairman

Is that agreeable to the House? Agreed.

I support the motion in the name of my colleague, Deputy J. O'Keeffe. It is a reasonable resolution and it is very important from the point of view of agriculture and exports. I was amazed at the Minister's attitude when he seemed complacent about the whole thing and conveyed the impression that everything was in hand, that everything would work out in due course. Time is running out, we are now almost to 1 July and discussion of the farm price package has not yet been agreed nor do we see any signs of agreement and it is not to be discussed by the Heads of Government. This indicates a lack of urgency. The Minister will readily recognise the tremendous loss that means for agriculture and not only for agriculture but for the whole food processing sector. There is great urgency in this matter.

My colleague, Deputy O'Keeffe, raised the question of reasonable increases for farm products. This is not an unreasonable request. Everybody realises that agriculture is the backbone of the country, the hope on which the whole economy turns. Deputy O'Keeffe also referred to the protection of the market support system. This is crucial to our interests. I hope Ireland's interests are fully recognised in the course of the discussions. I am sorry the issue will not be raised by the Heads of Government. If that had been the case it would at least have given the matter new impetus.

In the not too distant future there will be a change over of the presidency and that may or may not benefit Ireland's cause. Valuable time has been lost in trying to reach agreement in the shortest possible time in order to give the Irish producer maximum benefit.

We have always been considered good Europeans. We were recently called upon to give an indication of our commitment to Europe and we did so. However, nobody should take us for granted. There is a tendency to do so. Whether or not we want to accept it the delays that have occurred in these talks are severely detrimental to our agriculture and to our economy. These delays constitute a reduction in the possible grant-aid assistance or price increases that will be available to us. More delays will only represent a further blow to the industry.

The Minister spent time last evening referring to the proposed taxes on fats and oils and the crucial nature of that element of the discussion. Failure to reach agreement on that issue will be tragic from our point of view. The question of emphasis must now be geared towards reaching an early and satisfactory conclusion.

In relation to the Green Pound devaluation being sought by the Minister, somewhere in the region of 5.8 per cent for beef and dairy products, and 10 per cent for cereals, the response which appears to be emanating from the Commission appears to be a Green Pound devaluation of 2.8 per cent for beef, for pig meat 1.2 per cent, for other livestock 1.3 per cent and for cereals, 6 per cent. A failure to get an increase of the order of which the Minister spoke last night will mean that we are sliding down the European scale in relation to farm income. We cannot afford that. The Minister should reiterate his case in that area and try to ensure that the serious delays do not bring about a situation where those who are delaying the discussions will achieve their objectives by virtue of that procrastination.

Last evening the Minister mentioned the question of reclassification of existing less severely handicapped and mountain sheep areas. He was critical of the previous Administration and implied that provision in this regard was not made either in the previous Government's Estimates or in their provisional budget. As the Minister knows, provision has never been made in the Estimates for such changes in the handicapped areas, but changes took place. The Minister's argument is without foundation. I reiterate the call of my colleague for the reclassification of the areas referred to. Previously it was not necessary to enter a sum in respect of such changes in the Estimates. Those areas desperately need the advantages that such changes would bring about in the near future.

In relation to the dismantling of the negative MCAs at least in our commitment to Europe we have tried to be good Europeans and have been effective. For that reason and since we are a small economy largely dependent on agricultural output we should have the benefits. I cannot understand why we have not yet achieved the full benefits that Europe proposed for us originally. These benefits are often reiterated for us whenever the issue of Europe is to be sold to us. We accept that but our European partners must also accept that we demand the benefits that will accrue to us. I may be wrong, but there is a hint of suspicion that perhaps the present negotiations are hampered by some of the things this Administration said when in opposition. They equivocated on a couple of occasions that come to mind fairly readily about the benefits of Europe and the desirability of continued membership and so on. There may well be a possibility that our European partners do not take us too seriously. I wish to underscore the need for the Minister to very forceably press forward at the negotiations our case in relation to agriculture and the entire economy.

An issue which took up some considerable time today in the House was the possibility of an expansion in our beef herd. This is listed as item No. 5 in Deputy O'Keeffe's motion, and rightly so. If we want to achieve all the benefits that we are told about in relation to a certain meat deal, obviously we will need to have the raw materials to put into that package. If we do not have the raw materials there is very little likelihood that we will get any of the benefits. This was clearly illustrated today. The measures that have already been proposed for the expansion of the beef cow herd fall far short of what will be required if we are to capitalise on the recently announced meat expansion plan by the Goodman Group. Perhaps the Minister will let the House know whether there will be any net job losses in other sections of the beef and meat processing industry as a result of the implementation of the package that was referred to in the House today. I am anxious to find that out, and I am quite sure that the companies outside of the 40 per cent who are controlled by the Goodman operation are anxious to know also whether this deal will militate against their interests and, if so, to what extent. I strongly urge the Minister to give very careful consideration to item No. 5 in Deputy O'Keeffe's motion and try to ensure that the beef cow herd is increased in such a way that it will provide the raw materials for the much vaunted and greatly publicised meat expansion plan about which we have all heard a great deal.

A year or so ago we used to come into the House and hear the then Minister wrongly and firmly criticised if he returned from Europe with anything less than 100 per cent success. Under the present administration there seems to be a slight change of heart on that side of the House. They seem to have adopted a rather nonchalant air when the Minister comes home disappointed. That sort of nonchalance can be very expensive and very demoralising to the people who depend on the Minister's success.

I do not wish to make any political points but what is sauce for the goose is sauce for the gander. If criticisms were allegedly valid last year and the year before when farm price agreements were reached and agreed upon much earlier and very satisfactorily concluded by the then Minister, surely some criticism must be levelled at the participants in the current discussions who are acting on behalf of the farming and food producing sectors in Europe and who have failed to reach agreement. That is an abdication of their responsibilities to the people they represent. This is particularly unfortunate in the case of this country which is a net exporter and produces far more than is required and by virtue of the continued delay in the negotiations we now find that we are at the lower end of the incomes scale. If there is no visual indication of an agreement being reached in the last days of this month other measures will have to be taken because it could well happen, with the transition of the Presidency, the days and weeks might well go by without agreement being reached. Obviously that would be very serious for the industry in this country. I ask the Minister to bear in mind the changeover in the presidency and try to emphasise to his colleagues the pivotal nature of the industry to our economy.

Last evening we all agreed that a discussion of this nature would strengthen the Minister's hand in his negotiations and so it does and should. I would not like our European partners and colleagues to get the impression for one moment that we in this House were indulging in a cosmetic effort in order to hype the situation for their benefit. We are absolutely serious about this. These delays and the failure to reach agreement to date have cost this country at least £50 million. The food and agricultural sector can ill afford that luxury at present. It must be clearly brought home and illustrated to our European partners that delays of that nature cannot be tolerated in future. We accept that, because we had a change of Government and Minister and because of the other changes throughout Europe that could have some affect on the negotiations but that does not give anybody the right to go away with the impression that this will be allowed to continue in the future. It is detrimental to agriculture and to our entire economy and we will not tolerate it in the future. Perhaps he would give us some indication as to what if any progress has taken place behind the scenes in the past few days and what is likely to happen in the next few days. As we all know, the discussions which take place behind the scenes can often be as beneficial as those that take place publicly. Hopefully the official contacts which are now taking place will be accelerated and will be of benefit to us.

I am glad to have an opportunity to contribute to this debate and I thank my colleague for it. It is an appropriate time for this Motion and this is the appropriate forum for it. One thing which concerns me is the lack of concern and commitment by the Minister in connection with the talks that are taking place at this time. He should have visited his colleagues in their own capitals and indicated the urgency of these talks and their successful conclusion to farming interests in this country. This industry is perhaps of more importance in this country than in any of the other EC countries. I have said publicly before and I will say it again that a visit by the Taoiseach to the other Heads of State would have clearly indicated the urgency of this problem. It brings home to me the feeling that a serious type of discussion is not taking place, that there is no serious effort being made and there is not the kind of commitment which is required at this time for farming in this country. I suggest to the Minister that we would, with the Taoiseach, visit the other Heads of State with a view to indicating the type of urgency involved which is so important to us in Ireland.

When one speaks about the reclassification of the less severely handicapped areas this would bring enormous benefits to a substantial part of this country. As well as that it would bring in a large amount of money, free of charge, when one realises that the heaadage payments are paid for on a pound for pound basis by the EC. This surely is an EC attainable aid as far as this country is concerned. This is an aid we should aspire to not in the months or years ahead but immediately. The talks have dragged on and they have dragged on before but not to the same extent as they have on this occasion. This is happening because a serious effort is not being made to attain what we have set out to achieve. The motion as presented by Deputy O'Keeffe seeks a reasonable increase for farm products, protection of the market support system and so on. Going back over the record it will be seen that the Fianna Fáil shadow Minister for Agriculture, over the past four years, indicated to this House how easy it was to obtain all the things which he thought should have been obtained. He indicated that though efforts were being made we have now seen the total lack of effort and the difficulties which are there. Because of what is taking place and because of the lack of urgency we are still where we were months ago without any progress being made and without any of the aids which we aspired to being attained because of the lack of commitment. We have the full Green Pound devaluation.

Acting Chairman

I am calling the Minister of State.

On a point of order could I inquire if the Opposition have been in possession since 8.10 p.m. last evening.

Acting Chairman

I am not aware of that.

The Opposition merely moved the Adjournment last evening. There was no speech at all.

Prior to Deputy Durkan moving the Adjournment some of his colleagues had had the previous time.

Acting Chairman

I understand from the Clerk that the Progressive Democrats were in possession from 8.05 p.m. The document I have in front of me indicates that Deputy Bernard Durkan was to resume the debate and that he had 29 minutes left of his time. I have to go by the Order in front of me.

Could I put it to the Chair that the Progressive Democrats were in possession since 8.05 p.m. last evening. Therefore, it should have come across this side of the House at 7.05 p.m. this evening — from one side to the other.

On a point of order that is entirely incorrect. The Government Chief Whip knows quite well that the only people who offered were the people on this side of the House. With your agreement, Mr. Chairman, we decided to allocate the time among three of our speakers which is not uncommon in this House. If some Member from that side of the House had offered last evening the Deputy would be in possession now and he would not have had to raise that issue.

It is not my intention to delay the House or to argue. Certainly it is not my intention to mislead in any way but it is normal in Private Members' Time that the Opposition Party commence at 8.10 p.m. on a Tuesday evening and it comes across this side at 7.10 p.m. on the following evening. From what I understand the far side of the House has been in possession since 7.10 p.m. last evening and therefore it should have come across here at 7.10 p.m. this evening.

Acting Chairman

I understand that the Deputy is correct but it would depend on who was offering at the time. It would appear that the Fine Gael Party were offering at the time, that Deputy Durkan was in possession, he had one minute.

There will be no minute left soon.

Acting Chairman

He was allowed 29 minutes. We are losing time now.

We are now wasting invaluable time.

That is incorrect, if the Chair will pardon me saying so. The Minister of State at the Department of Agriculture and Food, Deputy Kirk, was waiting to offer last evening and he was not in a position to offer because it was on that side of the House.

On a point of order, I am amazed that the Government Chief Whip should make that kind of an allegation this evening. If he was in the House last evening he would have known that the only person who offered — and of course that is a long-standing order and tradition of the House — was from this side of the House; nobody else offered and there is no sense in the Government Chief Whip trying to come in on the act and claim that he has been discriminated against.

Acting Chairman

I understand that whoever was in the Chair last evening called Deputy Bernard Durkan and he had only one minute. According to the document I have here I was requested to call Deputy Bernard Durkan at 7 p.m. The document says he was in possession and he had 29 minutes of his time left. I was not here last evening but I am obliged to go by——

The Ceann Comhairle was in the Chair.

The point is that Deputy Durkan was sharing time last evening with one of his colleagues and at 7.25 p.m. he had 15 minutes left, not 29 minutes and this is the kernel of the problem. The outcome of all this is that we will lose five minutes on this side of the House.

That is totally incorrect. There was no indication last evening whatever of sharing speaking time amongst the Opposition. That proposal was made this evening before I started to make my contribution. I had not started my contribution last evening and the Government Chief Whip is entirely incorrect. We have already wasted three or four minutes.

It is a tragedy that this important debate is being held up as it is so vitally important to farmers. We are deliberately delaying time for the Government Party when we should be trying to get something done in Brussels for our farmers.

Acting Chairman

I propose that we get on with the debate. I am about to call in the Minister.

On a point of order, I do not wish to detain the House any longer but I must protest. Obviously the information which the Chair has received is not correct.

On a point of information, I must correct that. The information which the Chair has received is absolutely correct. Any further delays will only add to the delays which we are now referring to with regard to the farm price talks.

Acting Chairman

I am advised by the Clerk that——

That was not my understanding. The other side of the House has one hour before coming across here and that is totally incorrect and out of order.

Acting Chairman

I am calling the Minister of State, Deputy Joe Walsh.

That is why the farm price package had not been agreed to.

Time is running out and it is not my fault. If that is an indication of their activity in Brussels, then God help the Irish farmers. The last question I should like to put to the Minister is, is it his intention now or in the future to seek a change in the criteria for the extension of the disadvantaged areas, which is so important and I hope he will reply to it?

The Government want a rapid decision on the best possible package for Irish farmers with regard to these negotiations. Considerable progress has already been made in price negotiations and substantial gains have been achieved as against the original proposals. The Minister for Agriculture and Food, Deputy Michael O'Kennedy, has made it clear in the Council that neither he nor Ireland can be taken for granted. For example, he is still striving for improvements in the degree of dismantlement of the Irish MCAs and we are receiving more FEOGA benefits per head of population than any other member state.

I wish to emphasise that delays have nothing to do with changes of Government but with the intractable problems that exist at present. We expect an Agricultural Council within a week or so. We expect the Presidency to announce its intentions very soon with regard to the matter. We do not expect that the change-over from the Belgian to the Danish Presidency will delay matters.

I wish to respond to Deputy Durkan's contribution with regard to item No. 5 of the motion — measures to encourage the expansion of the beef cow herd — with particular reference to the recent announcement of a package to develop the Irish meat industry. It is disappointing for an Irish firm that has given an unstinting degree of service and support to Irish agriculture over a period of 26 years and is prepared to invest a substantial amount of money in the Irish food industry in a natural resource area with the provision of 665 additional permanent jobs and at least the same again in the multiplier effect of this natural resource industry, that there is such a begrudging attitude with regard to this matter. For several decades the IDA have supported the development of the Irish economy. Many Irish companies and multinational companies have been supported to a far greater degree, and we have never had this type of hostile reaction. It is sad when an Irish firm, one of the largest beef processing firms in Europe, invest their own money in the Irish economy, in contrast I might say to others who put their money into economies outside Ireland, that we could not at least have some welcome for this development. There is no question of dislodging jobs in other competitive firms in the meat business. In fact today the Minister for Industry and Commerce is opening a meat plant, Tara Meats at Kilbeggan which has been grant-aided by the IDA at a higher percentage.

That is the information we want.

Deputy O'Keeffe knows that an ultra modern plant is being erected in Bandon which will be in production by September. Again, this was grant-aided by the IDA to a higher degree than the Goodman plant. I wish to assure the House that any firm or organisation in the food area that has a proposal for expansion or for the development of the food industry will be most welcome to set up and develop here. They will get every facility. This is not an exclusive deal. I would have preferred that the Goodman company had been given a greater welcome as it is an Irish firm investing in probably the most important sector of the Irish economy especially when there is a ceiling and a difficulty in expansion for commodities such as milk. There is tremendous scope for expansion in the general meat area and we should be trying to encourage that type of development.

These negotiations have been almost unprecedented in difficulty. We all know the huge market problems which form the background against which they are taking place. We are only at the beginning of tackling these problems which clearly will take years to overcome fully but even more immediately we have the background of an enormous budgetary problem. Expenditure on agriculture in the Community is running at least £2.5 billion above available resources this year and next year we could be short up to twice as much again.

These are stark realities and allow little or no room for manoeuvre. We cannot solve our market difficulties by throwing money at the problems. Even if we could, we have not the money to fill the slings. We will not get the money — at least from an influential group of member states — even to keep the policy moving on more economical lines until we, in the agricultural policy-making business, demonstrate the capacity and willingness to get on top of the market problems.

Against that background the Commission's original proposals were understandable — understandable but too severe. It would have been understandable had we not secured any real improvements in the negotiations — understandable but wrong. For the Minister did secure significant gains. These were outlined at great length last night so I will not go into great detail now. However, it must again be put on the record that the Green Pound adjustment is significantly better than the original proposal — especially for beef, though still less than what we want; that the cereals net price reduction is less than that proposed, and the maximum moisture content impoved with a less drastic weakening of the support system; that the butter intervention systems will be more rational with the admission to eligibility of unsalted sweet cream butter and that the milk quota system will be much more flexible with the introduction of the restructuring scheme. This has been long sought and long promised but is now at last to be delivered I welcome that scheme because it will be of advantage to the less well off farmer, a farmer with a small quota and with some new entrants to the milk industry.

These are real improvements and they make the package more acceptable from Ireland's point of view. Of course, I warmly welcome all of them. There is, however, an area where, as Minister of State at the Department of Agriculture and Food, I have a particular interest — the development of processed and higher added value production. It has long been a catchcry that the CAP with its commodity bias militated against diversification of the industry. That was never strictly true. Our over-dependence on interventioin products here arose to some extent from our geogrpahical position but, more importantly, from the lack of market and product research, and a less than fully developed marketing emphasis in many of our major manufacturing concerns. If the CAP offered a temptation towards intervention thinking it was a temptation to which we easily succumbed.

One of our principal aims in Government is to encourage greater emphasis on value added and more highly processed production. This requires much greater effort by all concerned in food manufacture in Ireland to maximise the value of our native raw materials. This will be a long process but I am happy we are getting action in a number of those areas. As Deputy Durkan has pointed out, some of them are well publicised and I will not go into greater detail. The CAP as a whole does not hinder that process; indeed by providing a basic support and guarantee in the market it actively helps it but there are areas where anomalies in the operation of the CAP are a clear disincentive to further processing here.

The absence of MCAs on certain processed products, even though MCAs apply to the relevant basic products, is a clear example of such anomalies. The haphazard and uncertain way in which MCAs could be introduced or discontinued every six months on the group of processed products, such as chocolate, known as non-Annex 2 goods is another such example. The industry here has long been looking for the removal of such anomalies. I am very pleased indeed that the pressure of the Minister Deputy O'Kennedy, on this is paying off. The final compromise clearly provides for the introduction of MCAs on cooked beef and a range of sugar-based goods. It does not, unfortunatley, include soft drinks in that range. These are in a somewhat different position in that the introduction of MCAs in that case invovles not just Commission action but also unanimity in the council. Nevertheless, we are continuing to press the case and in the meantime the MCA extensions which have been included should safeguard the position — and indeed allow further development — of industries worth £50 million and providing 1,000 jobs.

The compromise also provides greater security in the operation of the MCA system for the non-Annex 2 goods. In future MCAs will apply whenever the calculated amount exceds a minimum figure. This is simply to avoid having to pay or collect very small amounts. Except in these cases, MCAs will apply to the processed products concerned whenever there is an MCA on the relevant basic products. This is as it should be and will allow the industries to plan their future in Ireland with greater confidence.

We have now passed through a series of traumatic changes in the CAP, and we remember the adjustments of recent years which were far more dramatic than anything which will be seen this year. We must now move forward and, going beyond the basic support provided through the CAP, make the best use of what we have got. We have real advantages in Ireland and we must exploit them fully. It is not unrealistic to believe that we can be one of the principal quality food producing countries in the Community, but that will require hard work and a different emphasis in the future. The CAP will remain an important basic support for our farmers and processors. It should thus give them the confidence to maximise the value of their production. This year's price package should enable us to take another step forward in safeguarding the CAP and encouraging the Community to agree to provide the resources necessary to allow all our policies to develop. From a more narrow but equally important viewpoint, it is also a package from which we stand to make real gains. For both these reasons it is important that it be adopted soon. We would still like to see it improved in some respects and the Minister, Deputy O'Kennedy, will continue to press for such adjustments even though the scope for manoeuvre is very limited. We can best support his efforts by passing the amended motion here tonight.

A Cheann Comhairle, I ask you to allow me to give some of my time to my colleagues. The Minister of State, Deputy Kirk, would like to make some comments on these negotiations.

It is very fitting that this House should express its support tonight for the long and intensive efforts being made by the Minister for Agriculture and Food in the context of this year's EC price negotiations.

In terms of direct financial transfers we in this country derive more benefit per head from the CAP than any other member state. Even more basically important is the fact that EC membership opens up to us a variety of major consumer markets for our agricultural and food products.

It is obvious that Community agricultural decisions have a widespread effect on the Irish farm sector. This is reflected in the intense interest shown here in the negotiations, as well as in the degree of attention devoted to the CAP by our media.

The annual price negotiations are always difficult, and this year is no exception. It is easy to understand why. There are now 12 member states, each with its own needs and viewpoints. There is a financial crisis in the Community. International talks on freeing agricultural trade are getting under way in GATT. Some of the proposals in the price package, particularly in the agrimonetary, cereals and fats and oils areas, are seen by member states as presenting them with major problems, but in spite of all the difficulties, the task facing this country remains the same — to defend the Common Agricultural Policy and Ireland's interests within it.

It would have been pleasant and neat if the 1987-88 price negotiations could have been settled long before now, but we are not in the business of seeking a quick conclusion irrespective of its contents. We need first to be satisfied that the package contains the best deal available for Irish farming and food. The five Council sessions on the price package that have taken place up to now have not been wasted. The Commission compromise that emerged at last week's session contained, from Ireland's point of view, some substantial improvements on the original Commission proposals.

The main elements of the prices package have already been explained and commented on at some length in this debate. I will not spell them out again beyond emphasising that the Minister for Agriculture and Food is still seeking to improve even further on what is now proposed. The prospect is that a few of the central issues may be raised at the European Council meeting next week. Obviously, a further effort to resolve the prices package as a whole will have to be made by the Agriculture Council itself in the near future. It will be our endeavour to ensure that a solution is reached which safeguards the future development of the CAP and the interests of the Irish farm and food producers.

EC policies in recent years have placed more and more emphasis on restricting production of surplus agricultural products. Given the cost of disposing of these surpluses on the world market and the present financial crisis affecting the Community, restrictive policies are likely to continue in the foreseeable future. This poses a problem for the individual farmer. Increased efficiency in production can contribute to an increase in income from traditional farm enterprises, but the scope for such improvement is not limitless. Therefore, more and more farmers will have to look elsewhere if their farm business is to grow.

One approach which must receive greater attention in the years ahead is the development of alternative farm enterprises. It is, of course, more important that only enterprises which have a genuine potential for growth are encouraged. The Department of Agriculture and Food together with ACOT are, therefore, carrying out a thorough examination of a number of enterprises with a view to identifying those which have a long term prospect of success and which can readily be fitted into the Irish farming scene. The enterprises that are being examined include farm guesthouse tourism, deer farming and sport horses.

Be careful of the horses.

Provided the long term profitability of these enterprises can be demonstrated, consideration will be given to extending the range of eligible expenditure under the farm improvement programme to include capital expenditure on these enterprises.

I emphasised earlier that one of the main benefits to us of EC membership is free access to Community markets. We generally tend to think of this in relation to our main farm products but it can have relevance also to my sector of horticulture. The aim of the office of horticulture and of the interim Bord Glas is, of course, to develop horticulture not only towards a reconquest of the home market but also, where practicable, towards exports within the Community. In fact, our horticultural exports have already shown an upward trend in recent years. The increase in very large part has been attributable to rapidly rising exports of mushrooms, in both fresh and processed form, to other EC member states. While the quantities involved are not enormous in terms of international trade flows, I see in this a good omen for the future. Our EC membership gives us a preferential edge over suppliers outside the Community. I expect that as the Bord Glas activities develop we will be turning our attention increasingly towards exports in addition to our efforts on the home market. Producers who acquire the ability to compete successfully here in Ireland should in many cases be able to do so elsewhere in the Community as well.

Among the matters we raised in the Community price negotiations was the question of including harvesting and ancillary equipment for horticultural crops and potatoes in the types of expenditure eligible for FEOGA investment aid. Such equipment is an obvious necessity for competitive commercial production and we want the Community to include it for investment aid purposes in the framework programmes we have drawn up for horticulture and potatoes. That would provide an appreciable backup to our efforts to develop both sectors; it would be particularly important for peas and beans, one of the few sectors not in market difficulties in the Community, as well as for the potato crop. This question falls within the Commission's competence; the Minister for Agriculture and Food has put it to the Commission that such facilities are needed in this country. I am glad that the Commission has expressed its willingness to examine our request. The Commission gave a similar response to another relevant request of ours, namely, that the Community regulation on producer groups be extended to cover potatoes as well as some other production sectors in Ireland. I am hopeful, therefore, that relatively rapid progress can be made with these improvements.

I would not want to give the impression that these moves at Community level are the only actions we are taking to develop horticulture. There is a whole series of other measures as well. For instance, quite apart from the matter of harvesting and ancillary equipment that I have just mentioned we are already obtaining substantial FEOGA support for improved processing, grading and packaging of our horticultural products. The Community measures to encourage fruit and vegetable producer groups are already available in Ireland and I will continue to do what I can to encourage Irish producers to make full use of them; this is particularly desirable in view of the rather fragmented state of production in this country and the requirements for steady and reliable supplies to supermarkets. We are also encouraging the use of new technology to increase productivity in horticulture. I was glad to be able to announce recently that provision is being made in the current Finance Bill to apply a reduced rate of corporation tax to the adoption of a new and useful technique known as micropropagation. Finally, An Bord Glas have recently set up a series of commodity teams for the various horticultural sectors. These teams are to put forward, within a matter of months, practical solutions to the problems of horticulture.

I am convinced that taking account of all these efforts, the horticultural sector in this country is destined to expand and prosper, fuelled by a growing demand for a number of its products and by increasing efficiency. Membership of the Community has given rise to challenges and difficulties in this sector as in others but, as I have shown, it offers substantial opportunities as well. These opportunities depend largely on the maintenance of an effective Common Agricultural Policy. That is a major objective of ours at Community level. The CAP must, of course, solve its market and financial problems in order to survive but it must solve them in a humane and equitable way. The Minister for Agriculture and Food is pursuing that aim with tenacity and determination in the current price negotiations, and this House should give him its support. I wish to share the remainder of my time with Deputy Liam Lawlor.

It is a very sobering lesson to all associated with agriculture that the talks in Brussels have dragged on for so long. This highlights the problems of agriculture in the Community. I hope the farmers, the farming organisations and all concerned are able to identify the reason the Council of Ministers is having such a very complex and difficult task planning for the future of agriculture in the Community.

In the past ten or 15 years we have on many occasions had the cliché of added value. We have had sectoral reports, IDA reports, beef processing reports and Telesis reports. Every time you make a political speech you speak about the potential of our young people and of added value in the food processing sector. If Fine Gael's attitude, to a lesser extent the PD's attitude and, as of this morning, Deputy Dick Spring's attitude, to the recent announcement in the meat processing sector is anything to go by in measuring their commitment to added value food processing, one can only say that they are very pathetic and begrudging towards our most important industry. Deputy Bruton should be well aware——

We hope it lasts longer than the last beef deal.

—— as should Deputy Durkan, of the unemployment close to my constituency and in Deputy Durkan's constituency, in IMP in Leixlip. I am glad that he has expressed his concern in the form of putting questions to the Minister today but he might address his questions to Deputy Bruton who had a long-standing connection with the IMP problem in Leixlip and, consequently, with the unemployment that arose there. Deputy Bruton is an expert on the meat processing and the agri-sectors. He took a pathetic attitude to the recent package announcment. I am glad Deputy Durkan is questioning the Minister with responsibility for food about the possibility of a food facility in Leixlip. I hope something on those lines will emerge but it should not be forgotten that there was a very thriving food processing plant in that town but thanks to the likes of Deputy Bruton and others who were involved it is no longer there.

A new era in the food processing sector is dawning. The Minister with responsibility for food has moved rapidly but the fact that decisions were taken and progress made was also cause for criticism among the people opposite. Do Fine Gael and Deputy Bruton want to deny the food processing sector the investment of about £70 million from Goodman International by virtue of the IDA and the FEOGA contribution that may be forthcoming? It is the one area of FEOGA investment that this country will hope to capitalise on in the years ahead. It is the one investment area on which FEOGA will look sympathetically. There is very little potential for further investment from FEOGA in the dairying sector. They are not considering any of our dairying projects in great detail.

We now have the structure of the meat processing sector in order and the slaughtering capacity has been put right. We must never have a repeat of the debacle of the seventies when Deputy Bruton, in his connections with the co-operative movement, was not able to cope with the situation. We should now try, as the Minister said to move forward into the fast lane of added value processing. All we have from Deputies Bruton and Spring are pathetic criticisms and negative comments. It behoves them to withdraw their negative opposition and not to oppose merely for the sake of opposing. What we are doing in the case of Goodman Internationl will take the meat processing sector through to the year 2,000 and give us the image abroad of a quality producer.

This is the first opportunity that anyone on this side of the House has had to put on record our congratulations to the Minister for Agriculture and Food, the Minister of State and Goodman International for their dynamic approach to the whole project that is emerging. I hope Deputy Durkan will be successful in his quest for some added value processing operation in Leixlip. That would be most desirable. What we are doing offers the one potential solution to the economic problems of this country. Agriculture is the greatest earner of hard foreign currency. It is an area with minimum outgoings. Every other sector out of which we export has an input of costs from outside the country. The multi-national companies are responsible for two-thirds of our exports. The remainder is from Irish-based industries. That is where the potential lies. We are all aware that much of the multi-national profits are repatriated, that only the minimum remains here.

Deputy John Bruton's criticism of this package arose from the very disappointing position with Hyster Automated Handling Limited which borders his constituency and is in mine. He seemed to join the two projects together in his criticisms even though his name is in granite as having opened that plant. In four years he did nothing about those doubts, fears and his criticisms which he is now expressing so freely.

I wish to put on the record my total opposition to Deputy Bruton's attitude towards positive pragmatic investment. His is the worse type of grudging Irish attitude one could take. It is that naked petty attitude that has so beset this country in so many areas. For once we have a Minister of State with responsibility for food who understands the sector. He comes from a dairying background. There have been meat processing plants in his area for many years and he has seen the growth, prosperity and failures that have taken place. I am confident, now that we have this programme, that in ten years time Ireland will be one of the cream producers of quality added value meat processing products which will find a shelf spot in all the quality locations, particularly in Europe. I should like to compliment the Minister on his work and assure him of the full support of Fianna Fáil for this project.

Deputies Hegarty and Leonard have indicated that they wish to participate in this debate and I am naturally very anxious to facilitate them. I am obliged to call the spokesman for the Fine Gael Party, Deputy Jim O'Keeffe, at 8.15 p.m. and I should like to suggest that Deputies Hegarty and Leonard share the 15 minutes that is left.

That is satisfactory.

I gather my constituency colleague, Deputy Sheehan, is anxious to contribute and, if the Chair agrees, I am prepared to defer my closing remarks to 8.20 p.m. to make five minutes available to him.

If the Deputy wishes to share his time with any other Member that is in order.

I was anxious to contribute to the debate to encourage the Minister to put on all the pressure possible to wrap up the wheeling and dealing that has been going on. While we can make very flowery speeches in the House, the grim fact is that farmers are losing out. I am aware of the problems involved — they arise every year — but at this time of the year it is imperative that a satisfactory deal is concluded without delay. I was surprised at the negative attitude adopted by the Minister with regard to the extension of the disadvantaged areas. In the run up to the election we held meetings with the groups who were looking for these extensions. Those meetings were attended by Department officials and representatives of the Government. We are asking that the momentum be continued and that the commitments given be fulfilled. Department officials should visit the areas concerned and carry out an assessment. We are not suggesting that the Government should rush over to Brussels with this programme because some areas may not qualify.

Grain growing gets a low priority in all negotiations and that concerns me. As a tillage farmer I hold the view that dairy farmers are doing comparatively well. Grain growers here are up against it because we could be washed out without a trace by the major producers in UK and on the Continent if we do not demand a quota system. Those countries would beat us any time in price. They can afford to sell grain at a price lower than ours. We do not have a hope of competing in that market unless a quota system is introduced.

There has been a lot of loose talk about import substitution and much has been done in the past three or four years to get farmers to grow wheat for flour. At last major co-operatives have agreed to give contracts to farmers to grow wheat. The co-ops have undertaken to buy the wheat for the millers. This is the first time we will be growing a substantial amount of wheat for flour. Up to now a lot of our flour was imported and the move by the co-ops is a major breakthrough. Few people realise that in the region of £120 million is spent on imported feed grain. The big assemblers of rations, our co-ops, look to South America and California for beet pulp and the Department cannot do much about that. The movement will have to come from the farmers and their co-operatives. The future of tillage farmers depends on how the Minister handles grain production.

I am pleased to be able to inform the House that the 300 acres of seed potatoes grown by Mitchelstown for the Fri Dor Corporation in Holland who will be setting up a business in Midleton shortly are looking very well. I understand that in the coming season we will have seed for 3,000 to 4,000 acres of potatoes for french fries. Last year we imported almost £40 million worth of chips and the move in Cork should help to arrest that.

I am disappointed with the interim board established by the Minister of State. I hope the new board will be different because I would be unhappy with one group having a monopoly on it. The parliamentary questions I tabled about this matter were neatly side-stepped and went for written reply with the result that I did not get an opportunity of questioning the Minister. The Minister referred to one producer group but we spent four years endeavouring to get the Irish farmers to set up their own groups. I am pleased to note that the Dublin meat group, in the charge of Colm Warren and Michael Mahon of the IFA, have arranged contracts with Dublin supermarkets. I appeal to the Minister to appoint those men to the new board. Our future lies in horticulture and it is important that we appoint people who have local experience.

In my view it would not cost very much to bring about the revolution the Government are looking for in horticulture. We should not delude ourselves into thinking we have a wonderful climate for horticulture. In the Cork area in 1985-86 we lost our shirts on French beans and were it not for a dry period this year we would probably have lost a lot more.

I would be grateful if the Deputy brought his remarks to a close.

I will support the moves of the Minister of State to improve horticulture and I look forward to him working more closely with farming organisations. He should realise we require to motivate our farmers.

I should like to thank Deputy Hegarty for sharing his time with me. I support the amendment which states that Dáil Éireann supports the efforts of the Minister for Agriculture and Food to have the negotiations on EC agricultural prices for 1987-88 completed as quickly as possible and in a way that best promotes the development of agriculture. It is important that we consider how best to promote the development of the industry. The efforts of the Minister, and the Minister of State, in recent months have been considerable. Since we entered the EC there has been too great a concentration on prices and not sufficient concentration on more efficient production, further processing and marketing. Prior to our entry to the EC it was a question of supply and demand and we did not have a big problem about storage of unwanted products. Intervention has proved very costly.

I welcome the Government's efforts to reduce costly imports by home production while at the same time encouraging further processing of value-added products and a more aggressive international marketing campaign. The decision by the Minister for Agriculture and Food to allocate responsibility for the different sectors to the Ministers of State will pay dividends. It will undoubtedly pay dividends to have Ministers with individual responsibility for production, marketing and processing. I come from a constituency where farmers concentrated on milk production since we entered the EC. The introduction of the super-levy in 1984 was a great drawback to small farming enterprises. The restrictive measures introduced by the Government in December of last year put a nail in the coffin of small milk producers. In the allocation of quotas and the buying up of quotas I hope the Minister in future will give special recognition to the problems of the small producers. In December 1986 we also had severe restrictions on intervention. They were not felt as severely as they might have been because since the early part of this year there was a very favourable trade with the British supermarkets. This offset our problem to a certain extent. Our first aim should be to diversify and reduce our dependence on costly intervention.

One important part of Deputy Kirk's speech was where he said that among the matters raised in the Community price negotiations was the question of including harvesting and ancillary equipment for horticulture crops and potatoes in the types of expenditure eligible for FEOGA investment aid. We have a sorry record over the past number of years with the almost complete collapse of our fruit, vegetable and especially potato production. In 1982 we imported 82,000 tonnes of potatoes and 25,000 tonnes of frozen potatoes at a cost of £57 million. Admittedly it dropped the following year and has dropped since, but that is something the Minister has to correct. I believe in grant-aid for that type of equipment. I was involved in the export potato business for many years. We found that the biggest problem was the substantial amount of money that the British were putting into potato production and potato storage. I believe the Minister is on the right path in regard to the production of potatoes.

The most important function of the Department at present is to monitor the changing requirements of our primary producers and to concentrate on quality products. It is clear that the Minister for Agriculture and Food has done a worthwhile job representing this country in the negotiations to date. He has obtained a series of improvements as compared with the Commission's original proposals and in particular in regard to cereals the MCAs on processed foods and the dismantlement of Irish MCAs generally will result in a price increase in terms of the IR£. We should, with all possible haste, get the dismantlement of those Irish MCAs because they are creating a very serious problem. Our aim at EC level must be to achieve and maintain an effective Common Agricultural Policy, a policy that will be conducive to the interests of farmers and food processors. The climate is right for us to continue on the course on which the Minister has embarked. I want to congratulate the Minister on his work and I think the House should express its appreciation of his efforts.

Deputy Sheehan rose.

I must call on the spokesperson for the Fine Gael Party to reply.

I have no objection to my colleague having some minutes of my time.

I would like to thank our spokesman on agriculture for allowing me five minutes of his precious time in this very important debate. I, too, would like to add my support to the Minister in his efforts to make sure he makes the best deal possible in Europe. Expansion of our beef cow herd must be a priority. It is a guaranteed formula for maintaining our cow herd numbers. The Minister should insist that the maximum rate for beef cow and cattle grants be paid to Irish farmers. If there is to be a future for our beef cow trade it must come by the preservation of the numbers of that category of animal. It is well known that with a reduction in milk production as envisaged in the coming years our cow numbers will dwindle. The Minister should also impress on his European partners that, where farmers are curtailed in their production of milk by the quota system, they should be allowed to benefit from the beef cow scheme to improve their income and bring it up to a living standard. There are farmers in my constituency who have a quota as low as 7,500 gallons. How can anybody expect people to live on that meagre quota? Under a certain limit it should be possible to incorporate the beef cow scheme to bring a farmer's income up to a viable level. I hope the Minister will put that across in his talks in Brussels.

The Minister should also take into consideration that no off-farm income should apply in the case of beef cow grant or cattle headage schemes. Our aim should be to increase our beef cow herd and to bring it to a standard that will benefit not alone the individual farmer but the State as well. Our aim should be to increase our output in beef production to the limit.

I am very much taken by the introduction by the Minister of An Bord Glas. I hope he will not muzzle that Minister and that he will provide sufficient funds to enable him to get that industry off the ground. In reply to a question of mine to the Taoiseach yesterday I was told that three was almost £70 million worth of vegetables and frozen chipped potatoes imported last year, totalling a quarter of a million tonnes. We have the finest climate in the world for producing vegetables. We have the finest soil. Because of the prevailing south-westerly winds we are free from any nuclear fall-out from Chernobyl etc. We should now capitalise on that very important industry. I would ask the Minister to explore the possibility in Brussels of getting EC grant-aid towards remodelling the Fastnet Vegetable Co-Operative in Skibbereen. We do not want a white elephant of a factory with briars growing around the doors. We want this factory operating again. We want the Government to tackle this problem and ensure that we will not import 250,000 tonnes of vegetables this year. The Minister should explore every possibility to get funds from Brussels to remodernise that factory which will be a source of income for the farmers of south-west Cork and south-West Kerry.

——and all Ireland. As I am sure my colleague has told the Deputy, this is what we are doing.

The Minister should do his utmost to have the less severely handicapped areas reclassified as disadvantaged areas. It is most important that we extend the disadvantaged areas as far as possible. We could nearly make a case for 85 per cent of this country to be classified as disadvantaged. There are areas in the Six Counties, fertile valleys, which are classified as disadvantaged. The Finn Valley in Donegal, with some of the finest land in the country, is classified as a disadvantaged area. I see no reason why the entire Cork South-West constituency could not be classified as a disadvantaged area.

I thank our spokesman for giving me this valuable time.

I can confirm my support for the last point raised by my constituency colleague, and I have no doubt our colleague on the far side of the House would also agree.

During my time attending Council meetings of the European Community I very often found it an advantage to be able to point to a debate in the Dáil, or to a decision of this House, to reinforce my efforts to secure the best possible arrangement for this country. The Danes in particular very often use the ploy of referring to their very strong foreign affairs committee and pointing to decisions of that committee by way of reinforcing their efforts to secure what they felt were in the best interest of their country.

My purpose in putting down this motion was to reinforce the hand of the Minister in completing the farm negotiations and this has been achieved by this debate. Deputies have been able to state their views clearly on what are the national priorities and objectives. It is very significant that the approach adopted by Deputies on all sides of the House has closely conformed to the objectives I set down in my motion. I touched on the urgency of securing an agreement and pointed out the specific objectives to be pursued in the national interest.

The Minister put down an amendment essentially covering the same issues in general terms. He has spoken of the need to have these negotiations completed as quickly as possible. I am in total agreement. It is in the interest of this country that we have a rapid and successful end to these negotiations which are costing the Irish farmer approximately £2 million each week they are delayed.

The Minister asked the House to agree that he should complete these negotiations in a way that best promotes the development of Irish agriculture. That causes me no problem. That is why we are sending him to Brussels. Of course we want these negotiations completed in the best interest of Irish agriculture. On that issue I see the Minister covering points in a general way, whereas my motion covers it in a specific way. As far as I am concerned, when the Minister goes outside the boundaries of this country, representing this country, and fighting to promote the best interests of the Irish farmer, I say to him, good luck, bon voyage, do your best, that is what we want you to do.

In a spirit of constructive opposition I will accept the Minister's amendment. I want him to go back to the negotiating table and ensure that there is a rapid ending to the negotiations, but one that is in the interest of the Irish farmer and that the results will be such that they best promote the development of Irish agriculture. On that score I have no problem in accepting the amendment.

I do not want the Minister to leave the House and go back to Brussels solely bearing in mind the general voice of this House that he should operate in the best interest of Irish agriculture. I want him also to remember the specifics which I outlined in the original motion. I want him to bear in mind that there has not been any dispute in this House on those specifics. In fact, they are national priorities. From that point of view, it is necessary that he bear those points in mind.

On the question of reasonable increases in the full green pound devaluation, the Minister referred to what was on the table already and said he was not satisfied. I am not satisfied, the House is not satisfied and the Minister can go back seeking the full green pound devaluation in the knowledge and confidence that he has the backing of this House. He can use that at the negotiating session in order to secure the full green pound devaluation.

The same applies to MCAs, or border taxes as they are known. It is clear that the continuing existence of MCAs is not in the interests of Irish agriculture. The problems our agriculture have to face in exporting to hard currency countries are very obvious. When I hear the Germans, the Dutch and people in that category talk passionately about the need for a full, free, liberal, open internal market in industrial goods, I say I am in broad agreement with them, but they should let us have the same arrangement in relation to agricultural products. As I see it, the existence of MCAs distorts competition and ensures that we do not have a full, free, open market. There has to be a sustained effort, if necessary initiated by the Irish Minister — he should not have to initiate it because I know the Commission want it as well — to totally dismantle MCAs.

Everybody agrees that there is a need for the expansion of the beef cow herd. I pointed out yesterday the problems associated with the diminution of the numbers of dairy cows. It is very obvious that this will lead to a shortage of calves and beef in the years ahead. Obviously it is a national priority that we reverse that trend and we take the necessary steps, with the assistance of Brussels, to substantially increase the beef cow herd. I quoted figures which suggest that we need to replace upwards of 200,000 dairy cows and, looking at it from the point of view of output and income, we need about 300,000 beef cows to replace that number. That is a major drop and I believe EC support is justified from the point of view of achieving that national priority.

I do not want to get into the Goodman deal because we talked about it at Question Time today, but I want to make one point. I believe it is quite legitimate for an Opposition, when there is a very substantial national stake involved in such an undertaking, to have full details, to tease out those details and to raise the issues which are causing public concern. That does not in any way indicate a blanket opposition to the deal or indicate that we are critical of the Government for being involved in it — although there are elements which suggest we should be critical because of haste — but it is essential that the Government bear in mind that it is normal, logical and democratic that the full details be teased out in this House. The question of additional capacity and availability of supply has not been clarified which brings me back to increasing beef cow numbers——

The Deputy must conclude.

As a result of this debate the Minister knows what the House requires and demands by way of an acceptable deal in these negotiations. We support the amendment provided the Minister bears in mind the specifics of the motion and secures a deal in line with them.

Amendment agreed to.
Motion, as amended, agreed to.