The House will now hear two minutes statements on matters appropriate to the Minister for Agriculture and Food and the Minister for Industry and Commerce. I propose to call the Deputies I have selected in the following order: Deputy Michael Kitt, Deputy Deenihan and Deputy Deasy in respect of matters to the Minister for Agriculture and Food and Deputy Lowry and Deputy Hogan in respect of matters to the Minister for Industry and Commerce.
Adjournment Debate. - Agriculture and Food and Industry and Commerce Matters.
Recently the Minister for Agriculture and Food announced that 95 per cent of lands in County Galway were to be reclassified as severely handicapped. I sincerely welcome that and thank the Minister for the biggest ever reclassification in the county. However, I am disappointed that something like 30,000 hectares were excluded which affect all 17 district electoral divisions in south-east Galway.
I was at a recent meeting held by the IFA with my Oireachtas colleagues in east Galway and we were told very clearly by the Teagasc officials at the meeting that individual farmers could lose from £132 to £850 because they were excluded from these areas. Will the Minister of State confirm that the Government have at all times been working to have all County Galway included and that they have submitted the whole county for inclusion under this scheme?
The Fianna Fáil Oireachtas Members in my constituency have been accused of lobbying for other parts of the county to the exclusion of south-east Galway. I reject that — and I know my colleagues would do the same — because we are strongly committed to having the whole county included. I am personally disappointed that the 5 per cent was not included. The Teagasc studies have shown that these lands in south-east Galway are by no means the best in the county as much of the land is flooded. Tynagh Mines have been closed for some years and the area has not recovered from the loss. However, it has not been included.
I should like an explanation from the Minister why counties like Roscommon were included, why the appeals procedure has not been set up and how it will work. Of course, I should like to have all the lands in the area surveyed, every farmer should be visited to see what the percentage of national farm income is in south-east Galway. We must change the criteria if we cannot get this part of Galway included. It must be on the basis of the individual farmer, not the district electoral division or the townland.
I am pleased that Deputy Kitt acknowledged and welcomed the fact that 95 per cent of County Galway is now classified as more severely handicapped. Compared to west Cork, Deputy Kitt is doing extremely well. To be reclassified from less to more severely handicapped status and gain the additional benefit of headage payments on all categories of cattle other than beef cows, an area must be homogeneous, consist of poor land and have the characteristics of low farm incomes and heavy dependence on agriculture.
The 5 per cent of County Galway in the Eyrecourt-Portumna area which was not reclassified did not meet these criteria. Under the appeal panel procedures, however, an excluded area can appeal the assessment made and all excluded areas will be given the opportunity to have their case reviewed. Press notices setting out the appeal arrangements will appear shortly in the national and relevant local papers.
I now call on Deputy Deenihan.
It is inexplicable that no land in the north Kerry constituency was reclassified as more severely handicapped. Vast tracts of land in north Kerry which are now classified as less severely handicapped must be regarded as the poorest land in the country. I am puzzled as to why it was not reclassified. However, when you consider the manner in which the survey was carried out in 1989 in the north Kerry area it does not really surprise me. The survey was not scientific or thorough and indeed the CAO in Kerry admitted at a recent special meeting on agriculture called by Kerry County Council that this was the case.
The survey was also based on the average income of a DED being 40 per cent of the national farm income at that time. However, farm incomes — I do not have to remind the Minister — have fallen drastically since 1989 in north Kerry, in some cases by up to 40 per cent.
In the original submission made by the Government to the Commission, no part of the south Kerry constituency was included for reclassification. I was glad that three DEDs were included in the final announcement. However, this proved one point, that exceptions could be made. If the DEDs of Kilnanare, Kiltallagh and Milltown could be included why not the neighbouring DEDs of Mohahiffe, Aglish and Rockfield? The same applies to areas in north Kerry which are among the poorest land in the country. I cannot see any reason for places like Kerry Head, Asdee, Pallas, Ballyhorgan, Lixnaw, Cliontrobraid and many more areas not being included. It was a totally politically motivated reclassification and many of our farmers have suffered as a result. I ask the Minister to explain how these people can appeal at this stage or is there any point in appealing?
First I reject the old nonsense about political motivation in this matter. From my standpoint north Kerry has done quite well. About 20,000 acres in the townlands which Deputy Deenihan mentioned have been reclassified from less to more severely handicapped. If there was a political input, at least some hectares in west Cork would have been so reclassified, but that did not happen on this occasion.
In general the reason a greater proportion of Kerry was not reclassified relates to the high incomes of the farmers in that locality. For example, the average farm income in north Kerry is 2.8 times that of south Roscommon which was reclassified. If the farmers in the areas which have been omitted feel aggrieved they are entitled to appeal and, as I said in my previous reply, notice to that effect will appear in the national and local newspapers. I wish the farmers in those areas the best of luck with their appeal.
The most recent bovine TB eradication scheme which was introduced in 1988 and was heralded as the complete answer to the problem has been a colossal and costly failure. In approximately three and a half years virtually £200 million has been spent on a futile exercise. It is worth recalling that in the previous 35 years we were told it was a scandal to waste virtually £1 billion of taxpayers' money, not to talk of the immense hardship to the farmers who suffered major financial losses.
There is now an admission by ERAD, the body set up to oversee the eradication of the disease, that it is technically impossible to eradicate bovine TB. What an admission. The reasons given are: defective testing, which is detecting only 40,000 to 45,000 of the 60,000 reactors in the national herd each year; inadequate control over the movement of animals; sharp practice by a small number of farmers; sloppy administration of the scheme by the Department of Agriculture and Food and spread of the disease by wildlife.
I am now asking the Minister to release the report he commissioned Mr. Fred Morris, senior counsel, to prepare 14 months ago on defective testing and which was completed last December. More importantly, I am asking him to stop the lunacy of wasting £60 million of taxpayers' money per year on a scheme that is not working. The disease levy should be abolished and farmers should be allowed do their own testing using their own veterinary surgeons at their own expense while the Department of Agriculture and Food's veterinary surgeons would carry out the pre-movement tests at a modest cost. It is time to stop the nonsense, stop throwing good money after bad and face up to the fact that the scheme has been a diabolical failure.
I thank Deputy Deasy for raising this matter. Everybody accepts that the progress, or lack of it, of the scheme to date has not been very exciting. Its implementation up to now has been a failure by any standards. A good deal remains to be done under this scheme. Since 1988, the year mentioned by Deputy Deasy, over 42 million animal tests have been carried out, and in the current year over five million tests have been carried out. This intensive testing regime has seen the removal of the order of 40,000 plus reactors annually. However, the hoped-for significant reduction in the residual disease level has not materialised. Of course, we all know it is the farmers who are losing most by this problem.
A number of factors contribute to the difficulty of eliminating the residual disease in the herd. The time is now opportune to re-evaluate and reassess the scheme. We certainly have enough reports on it and enough experience of its implementation. The message must be clear that we will have to eliminate this disease. There is a relatively small number remaining in the national herd. The task facing producers, farming organisations, veterinary surgeons and the State is to improve the existing position whereby 97 per cent of herds and 99 per cent of animals are TB free. On paper that might look good enough, but there is a residue of the disease which we will have to get rid of.
Some measures are being put in place to help eradicate the disease. These include the computerised movement permits. We all know that cattle in Ireland are moved about seven times during their lifetime. Another measure is a reliable test, particularly a reliable blood test. A vaccine for badgers has been identified as essential in the total eradication of the disease.
Pending the coming onstream of this technology we will have to pursue the matter diligently and in a way that has not been done to any great effect up to now by most of the parties involved. Nevertheless it can be pointed out that TB levels have been reduced from 20 per cent or so in the sixties to 1 per cent at present, but that is to no avail if this residue exists. If bovine TB is to be eradicated expenditure is necessary, but that expenditure has to be directed to specific areas and the weaknesses that exist.
EC funding is a very welcome back-up for the scheme. There have been some difficulties in reaching agreement on the conditions associated with the provision of this funding, and discussions are continuing with the Irish Veterinary Union. Given the position of the national finances I cannot over-emphasise the importance of securing this funding.
Merriott Limited was established in Thurles in response to the demise of the Thurles sugar factory, closure of which had just been sanctioned by the Minister for Agriculture and Food, Deputy Michael O'Kennedy. At that time the Government were very keen to provide so-called alternative jobs to appease a very irate workforce and electorate. It has since become obvious that this damage limitation exercise, was ill-conceived, rushed and highly speculative. This is borne out by the fact that only two of the promised five projects are functioning at present.
Merriott Limited was formed with the wholehearted encouragement and financial support of the Irish Sugar Company. Its opening was greeted with great joy, enthusiasm, optimistic projections and, indeed, pronounced self-satisfaction by the Minister, Deputy O'Kennedy. A short 15 months later it is simply another statistic in the ever-expanding industrial scrap heap. How could this happen? How can a company in which a State-sponsored company invested almost £2 million of taxpayers' money together with other State grants collapse after such a brief trading period owing a huge sum of money to creditors? Who was responsible for market research and a feasibility study? Did Shannon Development grant-aid these studies? Did Shannon Development vet the final report? Did Shannon Development monitor their investment in the company on behalf of taxpayers?
The role of the Irish Sugar Company in this debacle is incomprehensible. They handed over £2 million with no guarantees, no in-built protection mechanism, no return for their money. How could they allow their money be squandered in such a short time? Merriott Limited had two significant attributes. It had an excellent quality product, produced by a competent and willing workforce. I fail to understand why the Irish Sugar Company or Shannon Development did not see the glaring deficiencies in company structure. It was obvious that administrative costs were excessive for the size of turnover and that they could not justify the retention of an ineffective English based sales force. Yet these overheads were still in place the day the factory closed.
There were two offers to purchase Merriott in receivership. The offer favoured by the Irish Sugar Company would have retained the factory and jobs in Thurles. This begs the question, why was this offer not accepted by the Merriott directors in view of the investment of the Sugar Company and why were the Sugar Company over-ruled? Had the Sugar Company no legal hold on the only important asset of Merriott, its patent? Who owned the patent? Was it paid for by company moneys or by directors personal funds? Who sold the company patent and who were the financial beneficiaries of this sale?
It is unfortunate that a company such as Merriott was put into receivership and sold off. Its failure was due mainly to the economic downturn in the UK which was its principal market. Despite every effort by all concerned, it did not prove possible to maintain a viable operation at Thurles. I am satisfied from the information available to me that there was no alternative to placing the company in receivership, and that under the circumstances, it was inevitable that this should happen.
While I regret that jobs are lost to Thurles, I welcome the fact that it was another Irish-based company which acquired Merriott and that a number of the manufacturing jobs involved have been kept in Ireland specifically in County Tipperary. In this regard, I should point out that the benefits accruing from patent licences held by Merriott have been transferred to the new Irish owners.
A Cheann Comhairle, I wish to thank you for allowing me to raise this matter. The Minister for Industry and Commerce enacted the Competition Bill, 1991, and he hopes that this will result in sufficient competition in the marketplace to benefit the consumer. This is a theoretical notion of the free market which is the hallmark of the Minister for Industry and Commerce, Deputy O'Malley's philosophy on consumer issues generally. In a small jurisdiction like the Republic of Ireland it is difficult to generate genuine competition. This is particularly so when a few multiples seek to dominate the grocery business, for example, to the virtual exclusion of neighbourhood shops and the local grocery business.
We all know that the consumer will ultimately pay for these so-called cheap prices by paying higher prices for other commodities. Under the 1991 Competition Act, the Director of Consumer Affairs has no power to intervene if overcharging occurs in the grocery trade when the ban on below cost selling is removed. The Minister for Industry and Commerce introduced the Restrictive Practices (Groceries) Order in 1987 after careful consideration and study. It was clear then that below cost selling was taking place. A price fixing order was introduced in 1987 and if this order is now removed, the Director of Consumer Affairs will have no power in relation to basic food prices for milk and bread and the cases now being analysed and which are potentially the subject of court proceedings will have to be dropped.
If the ban on below cost selling is removed under the Competition Act, 1991, it will demonstrate the anti-consumer policy of this Minister and this Government.
I would like the Minister to clarify the position tonight on whether he intends to remove the ban on below cost selling; whether he will publish as soon as possible the Fair Trade Commission report which analysed the 1987 Restrictive Practices (Groceries) Order, and if he will indicate if any recommendations on this issue are contained in that report.
The Deputy will be aware that, during the course of the debate on the Competition Bill, 1991, the Minister for Industry and Commerce undertook not to revoke the Restrictive Practices (Groceries) Order, 1987, until the Fair Trade Commission's report on their review of the order had been received. The Fair Trade Commission's report was submitted to the Minister in August of this year. The report is being studied very carefully and the Minister will be making his views known on the recommendations when the report is published. The Minister hopes that it will be no more than a matter of weeks before the report is published.
The Dáil adjourned at 9.15 p.m. until 10.30 a.m. on Thursday, 17 October 1991.