Vol. 410 No. 4
3 Mr. Kavanagh asked the Minister for Agriculture and Food if he will confirm, that the latest round of farm price cuts will reduce £80 million from Irish farmer's incomes with disastrous results for rural Ireland; and if he will make a statement on the matter.
20 Mr. Sherlock asked the Minister for Agriculture and Food when it is likely that agreement will be reached on the EC farm price proposals; if he will outline the likely main proposals; and if he will make a statement on the matter.
I propose to take Questions Nos. 3 and 20 together.
Agreement on EC's farm prices package was reached on 24 May on the basis of a compromise proposal tabled by the Luxembourg Presidency.
As the details have already been publicised, I propose to include an outline of the original Commission proposals and the outcome of the negotiations for those sectors of major interest to Ireland in a tabular statement which I will circulate in the Official Report.
The package as finally adopted by the Council represents a significant improvement compared with that which the Commission had originally proposed. The initial Commission proposals could have led to a fall of £160 million in aggregate farm income in a full year. Under the revised package agreed by the Council in May the impact on incomes — even in a worst case scenario — should not exceed half that of the original proposals. However, the precise impact on producer incomes will be largely dependent on market developments and the extent to which intervention as an outlet is relied upon. In addition, to the extent that production becomes more market-led and quality oriented, for instance through the new CBF beef quality scheme, the impact on the sectors will be reduced.
In the light of present budgetary and market circumstances, and given the recent major increases in intervention stock levels for beef, butter and cereals, this year's prices agreement is the best that could realistically have been achieved from Ireland's point of view. This is especially evident bearing in mind that certain Ministers would readily have supported measures which went even further than those proposed by the Commission.
I firmly believe that the arrangements decided upon will effectively underpin producer incomes pending the adoption of the forthcoming CAP reform.
Following is the statement.
Tabular Statement.
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Commission Proposals |
Outcome of the Negotiations |
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Beef: |
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(a) 8 points reduction in intervention trigger levels |
(a) 4 points reduction in normal inter vention trigger levels |
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(b) abolition of safety- net arrangements |
(b) maintenance in a modified form of safety-net inter vention |
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Milk: |
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(a) uncompensated cuts in milk quotas |
(a) (i) 3% reduction in milk quotas, |
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(b) the elimination of a floor price for butter intervention |
1% of which will be redis tributed to meet the requirements of Mulder pro ducers |
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(ii) the quantities involved can be met from 1 April, 1992 through a Community funded buy-up scheme |
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(iii) the quantities required in the current year will come from a global reduction with compensation equivalent to that payable under the buy up scheme (41p per gallon — this would however apply for five years under the buy up scheme) |
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(b) the introduction of a floor price not lower than 90% of the intervention level for butter bought into inter vention |
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(c) the premium which had been payable on butter bought into intervention in Ireland is dropped but instead Com munity grants will be paid towards the farm costs of improving milk quality in Ireland. |
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Cereals: |
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(a) introduction of a set-aside scheme |
(a) introduction of set- aside scheme |
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(b) increase of co- responsibility levy to 6% |
(b) increase of co- responsibility levy to 5% |
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Sugar: |
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Reduction of support prices by 5% |
Support prices main tained at existing levels |
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Sheepmeat: |
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2% cut in support prices from 1992 but with an increase of 1.5 ECU/ewe in the ewe premium payable in disadvantaged areas which will largely offset the impact of the basic price reduction in Ireland. |
As proposed by the Commission. |
Will the Minister agree that his only purpose in the Commission is to engage in what he himself has described as a damage limitation exercise, that the economic future of our farmers is now totally determined by Brussels and the European Commission and that his influence has declined to such a degree that farmers have suffered a 60 per cent reduction in income since 1983? Most of this happened since this Minister took over at the Department of Agriculture.
The Deputy would like to give that over-simplistic interpretation but, happily, the people are too intelligent to be misled by it. Were it not for my influence the Commission's original proposals would have been adopted in that form. So much for my influence in the Council. The world is different from the time of some of my predecessors in the mid-seventies, notably a Minister from the Deputy's party, when price increases could be obtained for the asking. There were what were known as the Lardenois goodybags to be filled up with what people asked for. The current problems arise because there was not a sensible policy in those days and unwarranted price increases were given. This has resulted in surpluses. The job of Minister for Agriculture and Food these days is to minimise the level of price reduction. I have done that very successfully.
The Minister may be spending too much time in Brussels but he must be aware that the farming community and the industry which depends on farmers are in a state of shock and uncertainty because of the way business has been conducted in his Department and by the Government in Brussels.
Try as the Deputy may to give that distorted impression, it is not the case.
It is not distortion; it is a fact of life.
The only guarantee for producers is the guarantee of quality demanded by consumers. There is no point in Deputy Kavanagh giving the impression that we can produce limitlessly for intervention produce that nobody wants to eat. That is an outrageous impression. Under CBF market quality schemes and otherwise, we have reached premium market outlets. This is the best guarantee for the producer. Obviously, we will ensure that we get protection under the safety net proposals in relation to beef and butter which I have put in place.
