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Dáil Éireann debate -
Friday, 11 Dec 1987

Vol. 376 No. 8

Supplementary and Additional Estimates, 1987. - Vote 37: Agriculture and Food.

I move:

That a supplementary sum not exceeding £1,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of December, 1987, for the salaries and expenses of the Office of the Minister for Agriculture and Food including certain services administered by that Office, and of the Irish Land Commission, and for payment of certain subsidies and sundry grants-in-aid.

This token Estimate is required in order to make technical adjustments in the allocations for certain subheads in my Department's Vote.

The main item being provided is £16.6 million extra under subhead M.4 to meet expenditure in the current financial year on the incidental expenses for market intervention. Beef stocks this year are much higher than anticipated. This has meant extra expenditure on handling, freezing, storing etc. and also on servicing the capital which has to be borrowed to finance the stocks. I would point out, however, that there is no net overall increase in the amount being spent on market intervention operations this year. As Deputies will note, some £17.4 million extra is shown under subhead N.22 as additional receipts from the EC in respect of market intervention operations.

Another significant item being provided for in the Supplementary Estimate is £5.2 million extra under subhead M.7 in respect of the special premium on exports of beef to the United Kingdom. This variable premium is financed 60 per cent by the British Exchequer and 40 per cent by the EC, and beef exported from Ireland to the UK for consumption there qualifies for the premium. Payment of the premium to Irish beef exporters is made by my Department on receipt of the necessary funds from the UK. Because of a higher level of beef exports we expect to receive some £5.2 million more from the UK than had been anticipated. This is reflected under subhead N.25 as an additional appropriation-in-aid, offsetting in full the extra expenditure provided for under subhead M.7.

The saving on M.3 — disadvantaged areas schemes — arises mainly because of a slight but unavoidable slowing down in the processing of payments in recent months. This is due to the introduction of the new EC special beef premium scheme which necessitated extra inspections at marts, at meat factories and on applicants' farms, and considerable extra clerical work in my Department's local offices. All of this work has had to be done without increasing staff numbers.

The Supplementary Estimate also provides for some other adjustments to appropriations-in-aid. Extra receipts of £0.5 million for certain land annuities under N.15 are offset by a corresponding shortfall in receipts under N.12 from the sale of land purchased under the farmers' retirement scheme. Almost £1 million extra is shown under subhead N.23 in respect of receipts for intervention stock losses, etc. These additional receipts arise because of adjustments and corrections in the clearance by the EC Commission of the 1983 and 1984 FEOGA guarantee accounts and from settlement of an insurance claim involving intervention beef.

Finally, allowance is made for a shortfall of some £3.7 million under subhead N.18 in respect of receipts from the EC under the farm improvement programme and other farm investment schemes. These receipts have not come up to expectations this year; some of the amount expected will not arrive until after the end of the year.

I have referred to all the items covered by the Supplementary Estimate, which I now commend to the House.

I can scarcely say I welcome all the Minister has said, or has not said. It can be said honestly that never in the history of agriculture in this State has so much been provided by way of promise and expectation over the past year. It could also be said rightly that so little has been delivered as to render the whole concept of outlining programmes prior to general elections a total farce.

In the course of his remarks the Minister referred to the saving effected on subhead M.3 — disadvantaged areas schemes — saying that it arose mainly because of a slight but unavoidable slowing down in the processing of payments in recent months. I am not so sure that slowing down was unavoidable. Given the Minister's party's statements in the past in relation to the need to get the money quickly to those for whom it was intended and the great hardship that would be likely to be caused if that were not done, what the Minister has just told us represents a complete U-turn in relation to such matters. Judging by the number of complaints we have all received in relation to the payment of premia and various other grants — and here I have to admit that I do not deal in great detail with disadvantaged areas in my constituency — and from the information available to me, it would appear that there are continuous complaints about a slow down in the processing of applications and a consequent delay in payment. That being the case, there is an obvious saving effected but I am not so sure that it is unavoidable. Perhaps the Minister would elaborate on that matter when replying. I would put it to the Minister that the slow down could be avoided if he were prepared to redeploy staff within his Department in order to ensure speedy payment. The only reason a saving has been effected is that the money has not been paid out arising directly as a result of failure to process applications. That is completely at variance with what the Minister, when in Opposition, and his party colleague who was spokesman on Agriculture, had to say on previous occasions.

I said at the beginning that a great deal was promised to agriculture by way of innuendo about this time last year when various suggestions were being processed and prepared for presentation to the electorate, when it was indicated to us by various interests that a special relationship existed between the present Government party and the farming organisations. The Government have a very peculiar way of showing recognition of that special relationship, for instance, when one thinks of the rather scathing attack made by the Minister on the educational research and advisory services. As yet we are not aware of what the Minister proposes by way of replacement——

We will have the Bill in the Dáil next week.

I am not so sure we will have it in the House next week.

We will, it has been agreed.

I will endeavour not to allow the Minister to use my time in the way in which he appears to encourage people on this side of the House to use his time.

It is agreed between the Whips. It will be in the House next week.

I am disappointed the Minister did not make some reference to that because, we have had reason to listen repeatedly to the great——

On a point of order, Deputy Durkan has just expressed disappointment that I did not refer to the ACOT/AFT amalgamation. It would not be in order for me to do so. It is not covered by the Supplementary Estimate; it does not arise. That is the only reason I did not refer to it but we will have the Bill in the Dáil next week.

It has been customary, when Ministers introduce Supplementary Estimates, to refer to their intentions in other areas in the future, particularly if those intentions are of a positive nature. By his interjection the Minister has indicated that there is a somewhat sensitive area there he does not intend to address yet.

I will make one other general point, that notwithstanding all the great expectations and the hype there has been in relation to agriculture and food over the past eight or nine months, it transpires, amazingly, that there are fewer people employed in the food industry now than there were a year ago. That is a serious indictment of the Government. We have heard repeatedly about the great numbers of new jobs likely to be created under that heading; we know about the millions of pounds invested. But the statistics now indicate that job numbers have dropped in the past 12 months and, in reply to a parliamentary question some time ago, the Minister was unable to say whether or not expectations would be realised in the coming year. I would sound a word of warning in relation to the expectations that have been created amongst the community in regard to this very pivotal area. The Minister has indicated that he considers agriculture to be fundamentally important, and I agree with him. There is vast potential in this area for import substitution and exploitation of our food products. I would subscribe to anything the Minister proposes, provided it is workable and that the targets can be achieved. There is no sense in putting forward grandiose proposals unless the targets can be achieved, and going on past experience the likelihood of achieving those targets is not as great as the Minister would have us believe. I would be delighted to be proved wrong, but the indications so far are that the position is otherwise than as the Minister has indicated.

In the light of extra administration costs that are likely to be incurred, I see no reason that the Minister should not redeploy some of the staff with a view to speeding up the payment of grants and premiums. My guess is that no attempt was made to speed up such payments at all. The result is that we have a nominal saving simply because the paper mountain has not been shifted quickly enough. Everybody could achieve savings in that fashion. That seems to be the system whereby savings will be made under several headings. It just pushes problems not dealt with into the following year.

I am disappointed at the performance to date, given what we were led to believe, and given the special relationship that the Government had with the farming community. The only promise that the Government kept was in relation to the abolition of farm tax, but even that had the proverbial sting in the tail, because coupled with it was the reduction in VAT refunds which was a far heavier blow than the farm tax was ever likely to be.

Finally, I would be supportive of any proposals the Minister may have in relation to the creation of jobs and the expansion of the food industry and agribusiness generally, but I warn that there will be dire consequences if targets are not met.

I would like to make a few remarks on this supplementary estimate, much of which was brought about by the additional payments that were found necessary under the intervention system. I find it disappointing that in the year 1987 we are still so heavily dependent on intervention for so much of our agricultural produce. This year we have, happily, not had to resort to intervention for skim milk powder. That fact is very welcome but, given that the EC is to all intents and purposes bankrupt, we are still dangerously reliant on intervention for our beef and butter output. We simply have to develop alternative outlets. This we have conspicuously failed to do over the years. We have to realise that the clock is about to strike midnight so far as dependence on community intervention stores is concerned. It is very disappointing, for example, to find that the great bulk of our milk is still converted into skim milk powder and into butter each of which are sold as commodities rather than as real value-added products. The fact that so much more is spent this year on intervention than was anticipated is a source of disappointment.

Similarly, with regard to these beef exports to Britian and the payment of the premium on them I do not know what the breakdown is. But it would seem that unfortunately very little of that is real value-added beef exports; a lot of it is going out as carcase beef and probably some proportion of it is even going out as live cattle. It would be very encouraging to see this increase in beef exports if it was mainly in terms of processed beef rather than the way it is in fact going out.

Another of the headings on which this Supplementary Estimate is required relates, of all things, to the Land Commission's activities in collecting annuities that are still payable out of land here. When one considers the appalling cut in resources for AFT and ACOT for the next year, with the virtual dismemberment of both of those bodies, and the minute cut that is proposed so far as the Department proper are concerned, who of course are not directly providing any services for farmers or for agriculture, it makes one wonder. In particular we have to reflect on recent reports that there are 235 civil servants still employed in the administration of what was once the Land Commission although the Land Commission was closed down by a decision of the Government in 1984, a decision with which, I might add, I fully agree. The 235 civil servants who are still employed in the Land Commission under the Department of Agriculture and Food and as part of that Department cost £4.3 million per annum directly in salaries, to which various overheads must be added in terms of expenses, accommodation and so forth. The total cost therefore is probably not much less than £7 million.

A total of £8 million was collected last year from 270,000 landholders by the Land Commission. That is an average of £30 per landholder. There must be many landholders who pay less than the collection cost of their annuity each year. Land division is not now seen as a priority of the State. The value of the annuities to the State has declined, due to inflation. This is a prime example of a work area which appears not to have been reviewed and which has continued in a traditional way. I wonder, for example, what these civil servants, properly trained or even untrained, could achieve if they were transferred to the Revenue Commissioners or to Customs and Excise, rather than having them engaged in the futile work in which they are engaged at present.

There seems an unanswerable case for writing off many of these small annuities or for providing a means of closing off the loans by one final single payment, or for selling the right to the annuities to an insurance company, a bank or some other institution of that kind which would be prepared to collect them during the remainder of their existence. For the State to be engaged in this wasteful and futile work out of which there is no net gain to the State at all is ridiculous. That people are retained at useless work like this which even they themselves must see as useless while people who are engaged in agricultural research or in giving advice to farmers are let go is a ridiculous state of priorities.

While there are other aspects of that Department and their staff that are worth commenting on, they are perhaps the Department who have had most examination or scrutiny, often as a result of comments of the IFA and these comments are justified. When one considers the huge number of people engaged in administering the notoriously unsuccessful bovine tuberculosis eradication scheme, which is as costly as it is unsuccessful and consistently unsuccessful, one asks why there are 600 or more people engaged in clerical work in relation to that scheme when a very small fraction of those could more efficiently and effectively operate the scheme by means of computers. We still have the primitive card system that we had when this unfortunate and unsuccessful scheme was introduced approximately 30 years ago. It is crazy and an appalling example of bureaucratic priorities.

What has happened with the recent announcement of the amalgamation of ACOT and AFT has been particularly deplorable. The chief executive designate should have been appointed to oversee the merger and also to seek to structure the redundancies package in a way that would have been useful for the newly amalgamated organisation. That was not done and as a result the directionless pattern of recent months has left both organisations deeply demoralised. Some of the best and brightest talent, as is inevitable in such a climate of uncertainty, have taken the redundancy package. Indeed, I am told that in some of the major stations of AFT throughout the country all the most talented research people have decided to leave. This is a major setback for agricultural development.

I should remind speakers that they are expected to confine their remarks to what was in the Ministers speech.

What was not in it is important.

You would not say very much if you were to do that.

Anything that need be said on the Estimates, I have said.

I welcome the Minister's script and congratulate him on its brevity.

I thank the Deputy; I appreciate that.

He seems to have put everything he had to say concerning our major industry into exactly two foolscap pages.

With double spacing.

Surely the Minister had something more to tell the House about our premier industry. Is he aware that agriculture, since the foundation of the State, has been the backbone of this economy? Yet he comes into the House this morning and in a brief statement outlines, with the stroke of a pen, the existing potential for the development of agriculture. If he is serious about the future of agriculture, surely he would not order the abolition of the country committees of agriculture. Is the Minister's formula to promote agriculture going to be the stifling of the legitimate voice of the democratically elected representatives on those committees, as well as the voice of the members nominated by their respective farm bodies? Surely this is an attack on the democratic rights of public representatives. It is a slap in the face to the agricultural bodies who went to the trouble of nominating members for these committees.

No matter what way the Minister attempts to whitewash this action, the consequences will not go away. It will have serious repercussions on the farming community because the only voice the farmer had to expound his grievances has now been silenced. Is the Minister going to brush the matter under the carpet? Is he going to give any assurance at all to the House that he will give——

Acting Chairman

Deputy Sheehan, I reminded you earlier that there would be another opportunity for you to speak on the matter. You will have to confine your remarks to the Minister's statement.

This is a very serious matter. These committees might be gone before the Minister addresses the House. For that reason, I am asking him his views on this very important subject.

That is the main purpose of the Bill.

What about the sheep dipping committees?

When Deputy O'Malley has given as much service to the country as the sheep dipping committees have in introducing a disease-free product on to the European market, then he can speak.

That is the Deputy put in his place.

Fair enough.

Acting Chairman

You are wasting your own time.

The Deputy is not wasting time.

Where can our Irish farmers now turn for information, since ACOT staff are no longer in a position to supply it to them due to the lack of finance? Must they now consult the fortune teller and gaze into the crystal ball to get information about their farming activities and the future of agriculture? Surely the industry which means so much to the country should not be treated in that way? I remind the Minister that there is no premium boar scheme now being operated by his Department. There are fewer than 750,000 pigs in this country, while there are over 17 million pigs in Denmark. Why does the Minister not take a trip to Denmark to see if he could acquire some knowlege which would be to the benefit of the farmers of this country?

If I went the Deputy would accuse me of spending money.

I am amazed that the Minister is just sitting back and relaxing——

The Deputy's constituency colleague went.

——and taking no steps whatsoever to arrest the very serious problems which exist in agriculture. It is clear that if we are to have prosperity in this country it has to come from a prosperous agricultural community. We cannot all live in the Golden Vale where, if the Minister for Agriculture and Food or the leader of the Progressive Democrats lost their walking sticks in the evening, they would not be able to find them in the morning because of the growth in the level of grass.

I speak for a constituency which contains three peninsula areas which rely very much on EC aid and schemes for the promotion of agriculture. If the Minister is serious about expanding agriculture in those areas why has he inserted a clause on off farm income in the cattle headage and the cow suckler schemes? Last year the figure was £6,400 and this year it was reduced £5,700 to disqualify people who are playing a legitimate part in promoting the future of agriculture in Ireland.

If the Minister knows anything at all about agriculture he must realise that if there is to be a future for agriculture it will come from an expansion not an annihilation of the cow herd. Why does the Minister not face up to that fact, completely abolish the clause on off farm income and let the part time fishermen and part time farmers, whom I represent in my constituency, play their part in bringing agriculture back to the position where it should be? I am amazed that the Minister is so reluctant to do this. Instead, he is taking the retrograde step of reducing the figure in order to cut more people out of the scheme.

The excuse the Minister has given for not paying the headage grants at the same time as last year is that there were some problems with the EC. I do not think it is correct for the Minister to say that in this House. I appeal to the Minister to pay the cattle and sheep headage grants to the farmers before Christmas. During the four years and three months the Coalition were in office we made sure that every farmer received his Christmas cheque as a Christmas box to spend. The Minister should now do the same honourable thing and pay out these cheques next week to the farmers.

If the Minister is serious about promoting agriculture why does he not provide sufficient funds for the ACOT committees? Penny pinching seems to be the criterion used by the Department of Agriculture and Food. I cannot see why the Minister is victimising farmers in not allowing them to receive the knowledge which the ACOT advisers can give them. The ACOT advisers are hampered from doing so because of a lack of funds. No agricultural classes have been held this year and we have been told there is no money for the education of young farmers. The Minister even introduced a Mickey Mouse scheme to compensate small farmers for the decrease in their milk quotas. How can the small farmer compete with the cheque book farmers? How can they get their quotas increased to a viable level?

I would like the Minister to spell out to this House why his Department penalise a farmer whose quota is under 15,000 gallons for exceeding that quota. A farmer who has a quota of only 5,000 gallons is penalised in the same way as a farmer with a quota of 250,000 gallons. Surely, commonsense will prevail. The Minister should take immediate steps to rectify the anomalies which exist in that scheme. The small farmer will be wiped out completely by the cheque book farmer unless the Minister takes steps to give him a viable quota. Otherwise, he has no hope. The Minister may say he can lease it from his creamery but he cannot because he has not got the money to pay the creamery. He is already in debt up to his neck with the creamery. How can he make money to rear his family on a quota of less than 15,000 gallons? Some of these farmers have a quota of only 5,000 gallons.

I think the speakers who have contributed to this debate. There is one obvious point which I have to make by way of introduction, that is, that I confined myself in my speech in introducing the Supplementary Estimate to the areas where the adjustments were required and those areas alone. That is in accordance with the procedure and requirements of this House. The fact that the number of areas which require adjustment is so limited is a vindication of the management structures which I have implemented in the Department to ensure that we stay within the allocation this year and next year. I am glad to say that we are providing only for a token Estimate which will enable us to make the adjustments for the reasons I have given.

For their own reasons, speakers decided to introduce much broader issues. I am very glad they have done so because I will address each and every one of those issues. I have to say that 20 minutes will not be adequate to outline the record of achievement of the Government in this area during the past eight months. I propose to take up the challenge now and I will give the precise details of those achievements and how they were brought about. Deputy Durkan said that so much was promised but so little has been delivered by the Government.

Precisely.

The performance of this Government in the agricultural and food area is, by any standards, the performance not just of this year but of any year and it is in direct contrast with the trend towards depression of farm incomes all over Europe. I have had one problem in bringing this fact to the notice of the public — perhaps it is time I released myself from this constraint — and it is this.

By all means.

I did not want to advertise in Europe the level of success we have achieved in agriculture as their incomes are going down. In Europe we are unique, as the Agricultural Institute recently indicated, in that there has been a 20 per cent increase in farm incomes this year. Yet Deputy Durkan calls that a promise, not a performance. Every other country in Europe — and I can give many examples — is showing major decreases in farm incomes in 1987 as compared with 1986. I did not want to raise problems with my colleagues in the European Community but I am going to do it now anyway. Denmark, a country comparable in size and almost comparable in the importance of agriculture to Ireland has experienced a decrease in farm incomes of 8 per cent this year as compared with last year. We have an increase of 20 per cent. I do not think it is reasonable for Deputy Durkan or anyone else to call that a promise and not performance.

Tell us about the jobs in the food industry.

We have less than 500,000.

I want to put that in context. I admit that that increase in farm incomes is distorted by one fact alone. The level of farm incomes in 1986 was so low that the increase of 20 per cent is, of course, an increase over the most depressed level of income any Government ever presided over, namely, the Government of which Deputy Durkan was a member. One of the reasons it has been a little easier for me to make such a major jump forward is the outrageously poor performance of the previous Government.

What about the decrease in the food industry?

Deputy Sheehan, during the course of his contribution, spoke about the crucifixion of the small man on the quotas——

He has been annihilated.

——and said that the cheque book farmers are going out and buying up the quotas. He spoke as if I was the Minister who tamely and meekly accepted and introduced the quotas. He knows that he does not have to look any further than his own benches. The Minister for Agriculture who was involved at that time is a man for whom I have personal respect but the then Government apparently adopted this.

What did this Minister do in the spring of this year?

I inherited from the previous Government quota restrictions which were crucifying the small farmers. For four years the only test for purchasing quotas was the size of your cheque book and the amount in your pocket. It is true to say that during the past four years in every parish — and not just in west Cork but in Limerick and Tipperary also — it was the big farmers who were going around buying up the quotas and increasing the price of leases all over the place. I do not think it was carelessness on the previous Government's part because that is the way they wanted it.

What will the Minister do now with his Mickey Mouse game?

I will tell the Deputy what I will do. Since I came into Government I have negotiated and argued with the European Community that I could accept these restrictions and, exceptionally, I am the only Minister for Agriculture within the Community who has been allowed to introduce two schemes because I insisted I would——

You are great.

——to protect the very people who were being ignored by the previous Government. I have introduced a milk restructuring scheme which I have sent to each co-op which will require that special priority is given in the transfer of quotas to small farmers, farmers under 25,000 gallons and, in particular, those who have been hit——

At what price?

I will come to that in a minute. It will apply also to people whose quotas were affected by disease in the year in question. They must now be given priority in the purchase of quotas through any co-op. Otherwise I will not sanction the schemes. They, and not the big fellows with the cheque books, will be the top ones. The small farmers the Deputy is moaning about are now going to be protected.

At what price?

I have gone further. I have put a ceiling on the price because I cannot confiscate them under law. The previous Government sat back and did nothing. The ceiling is that which operates under the milk cessation scheme.

We promoted agriculture while we were in power. It has gone into decay since we left office.

If an increase of 20 per cent is going into decay I will leave that to the imagination of Deputy Sheehan. This week I introduced a new scheme for a clawback from sales and leasing. Depending on the size of the holding or the farmer to whom the sale or lease is being made, I will have a scaled percentage clawback for the first time. This will give me a national reserve which I will then proceed to allocate to small farmers below 20,000 gallons, to young farmers below the same figure or those who have no quotas at all, or to someone unlucky enough, when this scheme was introduced by the previous Government, to have——

For how many years?

For as long as it needs to run. I want to make it very clear that unfortunately the scale of the problem is such — and I am very familiar with it — that farmers from west Cork come to me on Saturday mornings to tell me about their problems and they did not start during my time. They are even coming to me from my home town of Wexford.

They would have no need to go to the Minister from west Cork.

I have their addresses and I will give them to the Deputy. They have a long journey to travel.

While he is in Anuga they go to Joe Walsh.

Do not forget about the food industry and the extra jobs there.

If that is the extent of Deputy O'Malley's contribution, his perception is a bit off line as well. I will deal with the broader issues first.

Who was off line in Anuga?

Acting Chairman

Order, please.

I will deal with the points Deputy O'Malley made.

What about the food industry?

Deputy O'Malley referred to beef exports to the UK. There was a very major decrease in cattle exports and a huge increase in beef exports. I am glad to say that there has been a 25 per cent increase this year in vac-pac exports to the United Kingdom. That is the pattern all over. It is not because of any increase in intervention stores. It is the very opposite. We have virtually nothing in intervention in skim milk powder. Deputy O'Malley should know that.

I said that.

The sales of our dairy products through diversification or through the demands of the markets in South America are at the highest prices they have ever been. In Mexico, Venezuela and Peru where I have been——

On your own.

Deputy O'Malley was never one to be modest. He did more travelling during his time as Minister for Industry and Commerce than I did when I was Minister for Foreign Affairs in the same Government. If he checked back over the records he would find —and I do not know who accompanied him — that it cost the Exchequer much more than my couple of hundred quid cost on what has been a very successful trip to Venezuela. If he checked the records from 1977, 1978 and 1979 he would find out who was the most travelled Minister and who cost the Exchequer most. Deputy O'Malley would come out way on top, even ahead of the Minister for Foreign Affairs. I am sure he has lots of mementoes in his house or elsewhere to record the fact that he visited widely and was widely received.

This is juvenile.

Deputy O'Malley made a juvenile comment.

God help us.

I do not know who accompanied him but the facts speak for themselves.

Could we have news on the jobs in the food industry?

This year we are spending £145 million compared to £127 million in 1986 on the various livestock grant schemes. This covers an increased rate of grant from the FEOGA area. The 20 per cent increase in farm incomes was not an accident. Across a whole range of areas, an increased draw down from FEOGA funds, guidance funds, the western package, the western development package, grants for disadvantaged areas——

What about non-farm income?

Is the Minister aware that 10,000 calves were exported and that there are 500 fewer jobs in the industry than 12 months ago?

——and the drop in interest rates, there has been progress reported.

The Minister is talking like Santa Claus.

Acting Chairman

Deputy Durkan, who should have some knowledge of procedure having been chairman of Kildare County Council, should respect the right of other Deputies to speak without interruption. Is the Supplementary Estimate agreed?

Not with a great deal of enthusiasm.

We hope to get detailed answers at a later stage. The Minister did not reply to our queries today.

Acting Chairman

And we will have to arrange a special debate for Deputy Sheehan.

Vote put and agreed to.
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