Vol. 422 No. 5
1 Mr. Deasy asked the Minister for Agriculture and Food if he will outline the concessions he is seeking from the EC to offset the losses being suffered by sheep farmers due to the reduction of the ewe premium and the depressed market conditions.
3 Mr. Ferris asked the Minister for Agriculture and Food if he will outline the changes affecting Ireland which were agreed on 30 June 1992, at the meeting of the EC Council of Ministers; whether compensatory payments were agreed for any reduction in milk quotas in 1993-94; and if he will make a statement on the matter.
40 Mr. Connaughton asked the Minister for Agriculture and Food if he will outline the number of breeding ewes in each of the years 1988 to 1992; if he has any plans to make sheep production more profitable in the short or long term; and the prediction as to breeding ewe numbers for the next few years.
54 Mr. Ferris asked the Minister for Agriculture and Food if his Department have had discussions with the farming organisations regarding (1) the reason for the recent demonstrations by sheep farmers at Agriculture House, Kildare Street, Dublin 2 and (2) the need for such demonstrations in future to be eliminated; and if he will make a statement on the matter.
I propose to answer Questions Nos. 1, 3, 40 and 54 together.
In accordance with what I indicated during the Adjournment debates in the Dáil and Seanad on 24 June last, I raised the question of the lower ewe premium for 1992, resulting from its calculation for the first time on the basis of a single region for the entire Community, at last week's Council of Agriculture Ministers meeting in Luxembourg. At the Council I pressed for an additional premium to compensate farmers in member states, including Ireland, where market prices are particularly low. I received the support of some other Ministers who had similar concerns. The Commission noted my concern and agreed to examine the matter and to monitor developments closely over the coming months. I can assure the House that I will keep in frequent touch with the Commission on this issue and that I will raise the matter in the Council again should that prove necessary.
Conscious of the current marketing difficulties facing sheep producers and the need to pay the first advance of the 1992 ewe premium and the rural world premium at the earliest possible date, I have decided to make an ad hoc payment to 1992 applicants on the basis of their 1991 approved ewe numbers. This advance payment, and the additional special rural world premium in disadvantaged areas, will amount to close on £39 million. This, together with the payment last April of the final balance of the 1991 premium, will bring the total ewe premium payments for 1992 to approximately £84 million for the 52,000 sheep producers in the country.
During the Adjournment debates, I referred to the recent demonstrations at Agriculture House, which involved the intimidation of some of my staff and the forcing of unfortunate ewes into the foyer of my Department. I have said those actions were deplorable and that such behaviour would not be tolerated. In addition, immediately after the demonstration, I issued a press statement condemning those actions. I wish to reiterate my strong feelings on this issue and to assure the House that behaviour of that kind is not acceptable at any time.
I accept that there are currently problems in the sheepmeat market and that the new method of calculating the ewe premium is not adequately addressing those problems in some member states, including Ireland. That is because market prices in the Community have not come together to the extent expected when the new arrangements were agreed in 1989. I have been drawing attention to the likely emergence of this problem for many months. Now that the recent decision on the ewe premium has confirmed that my anxieties on this score were well founded I will increase my efforts to have the problem solved.
Apart from my efforts to secure increased premium payments, which form an important part of sheep producers' incomes, and the satisfactory outcome of the recent Common Agricultural Policy reform negotiations for the sheep sector, my Department have already taken a number of initiatives to improve competitiveness and profitability of the Irish sheep sector. These include the provision of generous State and FEOGA grant aid for establishment of modern slaughtering and processing plants, the upgrading and modernisation of existing plants and the upgrading of facilities at livestock marts. Furthermore, a code of practice was introduced which was supported by all sections of the industry. This code has resulted in improvements in quality and presentation of the product. At farm level, my Department, in co-operation with the main sheep breed societies have intensified the breeding programme to improve productivity, growth rate and carcass quality. In addition, the extension of the EC producer group regulation to the sheep sector should be of benefit to producers in their marketing efforts. A proposed EC sheep carcass classification scheme which should greatly facilitate intra-Community trade to the benefit of producers is under discussion at present. Finally, CBF, on which farming organisations are represented, is involved on an ongoing basis in the promotion of sheepmeat both at home and abroad.
I believe that all of these measures have contributed and will contribute further to the development of a strong, vibrant and competitive sheep industry.
I was asked about the number of breeding ewes. In 1991 there were 4,622,000 breeding ewes and the total sheep number was in excess of nine million. It is expected that the ewe numbers for 1992 will show an increase.
As regards milk, a decison was taken in principle by the Council of Ministers to reduce national quota levels by two successive cuts of 1 per cent applying from 1 April 1993 and 1 April 1994. However, before these reductions can be implemented the Commission is obliged to present reports to the Council of Ministers on the market situation, accompanied, if necessary by proposals to revise these decisions. If the present favourable trend in the market for dairy products continues it will be very difficult to justify any reduction in quota in 1993-94.
On a point of order, a Cheann Comhairle, you have asked us to ask concise questions, could we have concise replies from the Minister?
Hear, hear.
We should all be very conscious of the very strict time limit applying to priority questions.
The Minister is answering questions that were not asked.
Let us not waste any more precious time.
The Minister has wasted enough of it.
I feel that the Minister may well be near the conclusion of his remarks.
He should be.
We are not sure about that.
I am not sure about it, either. I do not have a copy of them before me.
First, I am answering question I was asked and it is inaccurate and untrue for Deputies to allege that I was not.
If the present favourable trend in the market for dairy products continues it will be very difficult to justify any reduction in quota for 1993-94. It is my intention to approach negotiations on this basis, as I successfully did in relation to the proposed quota cut for 1992. In the event, however, of agreement on quota reductions producers will be compensated at the rate of 4 ecu-100kg or approximately 20.5 pence per gallon for ten years and provision will be made for a voluntary buy-out scheme.
Will the Minister confirm or deny that the real cut in the ewe premium has been £6 in both disadvantaged areas and those that are not disadvantaged? The cut is not, as we were told by the Minister on 24 June last, 45p——
Hear, hear.
The House was grossly misled on that occasion. We were given advice relating to 45p as an element of the first payment, which is 30 per cent of the calculation of the ewe premium. Is it true that the Minister also said in recent weeks that the new ewe premium system we are operating under has backfired on Ireland? I appreciate the original mistake was made in 1989 when the entire Community was taken as a single entity and our price system was based on the prices within the Community. Will the Minister agree that this is the base cause of the problem and that it has been further exacerbated by the collapse in the price of lamb and exacerbated further by the fact——
Deputy, please.
——that he did not attempt to offset the considerable reduction which has been brought about recently in the ewe premium?
The questions are overlong.
What is he going to do to compensate farmers for the £56.6 which has been lost to all sheep producers within and outside disadvantaged areas?
First, the decision in 1989 is the cause of the difficulty in relation to the ewe premium.
A Fianna Fáil Minister.
I always accepted that the difference for calculating the ewe premium in the change from our single member state status to a single European country status resulted in a loss in the first advance this year in disadvantaged areas of 45p and outside disadvantaged areas £1.76. That is an estimate.
The first.
That is the first, yes, and that is what has happened.
That is incorrect and the Minister knows that.
That is factually correct.
Deputy Deasy. I have called Deputy Ferris, whose Question No. 3 refers.
No. 3 and No. 54 refer.
For the time being it can only be Priority Question No. 3.
The Minister has linked No. 54 with it and that is in my name also.
We are dealing with priority questions.
They are all related. Whereas we realise the Minister was not personally responsible, there is a drop in income for sheep producer farmers of approximately £1,000 per year. Does the Minister agree that this has been made up by a collapse in the market and by the fall in the ewe premium? Whereas I welcome the fact that the Minister has given a commitment now that he is going to pursue this, does he agree that hopes have been raised by officials in his Department who have stated publicly that he is going to continue his efforts to ensure that this drastic situation is not going to continue? I have a further supplementary to the second part of Question No. 3. From that meeting of the Council of Ministers on 30 June we are aware that this year there will not be milk quota reductions, so there are no compensating amounts in the agreement on the reform of Common Agricultural Policy; but in the agreed reductions of 1993-94——
A question.
Has the Minister now reached agreement that there will be compensation in 1993-94 for what is accepted as being a reduction in the milk quota?
I reiterate that the 1989 decision has caused this problem. The problem then was manifested in Ireland by the decision of 19 June of the management committee to implement that decision. At the meeting last week in Luxembourg of the Council of Agriculture Ministers I had a motion on the agenda to ask the Commission to make up the shortfall in Ireland in the next two advances, the one in November-December and the one in March. As I said in my reply and I was supported by two other Ministers representing member states, the Commission agreed to examine the matter in the light of market developments and to get back to me. I will keep up the pressure on the Commission to ensure that the shortfall which has occurred in Ireland will be made up in the next two advances.
In relation to the market situation, which is extremely difficult with prices extremely low, I have been in contact with CBF, who are the promotion and marketing agency, and next week they are carrying out three major promotions for lamb in the French market area to try to increase the throughput and make some impact on the price situation there.
Does the Minister now accept that the real drop in the ewe premium will be actually £6?
Or is the Minister telling him 45p?
Not 45p.
These are priority questions. Only the Deputy who tabled the question may intervene. Let us not forget that.
It is a simple question.
What has occurred in relation to the premium so far is a drop in disadvantaged areas of 45p, which accounts for two-thirds of the sheep numbers in the country, and £1.76 outside disadvantaged areas. I raised this matter and had the item on the agenda last week at the Council of Agriculture Ministers to have the position redressed for the next two advances. The Commission agreed to have the matter examined and to get back to me in the light of market developments. I cannot anticipate what is going to happen in the next two payments.
Will the Minister agree that the figures he is quoting are applicable only to disadvantaged areas and would not necessarily apply to the whole sheep population? Although he has expressed regret about the demonstration, will he not agree that one can share the frustration of people who had to protest in this manner? Will he not agree that the figures he is quoting are relevant to only one section of the amount and repayment and that the reduction in the ewe premium is based on a European average and an Irish average and in between we are the sufferers? The 1989 decision did not produce that kind of equation. It is no fault of the Minister. We welcome his support, but we need his intervention to get a change in this attitude; otherwise, sheep producers will be in real trouble.
We need the £6 back.
The 1989 decision caused a problem of going from a member state to a European average. The convergence which was supposed to occur has not occurred. In the light of that, I raised the matter at the first possible opportunity, which was at last week's Council of Ministers meeting. The Commission has agreed to examine the matter and to get back to me. I will keep up the pressure on the Commission to seek to have the matter redressed for the next two payments.
Could we have a quick answer to Question No. 2, one figure?
If it is responded to immediately and the answer is not overlong.
Question No. 2?
Just a figure.
I am afraid it is longer than that.
The time for dealing with priority questions is long since exhausted and I am now proceeding to other questions. Question No. 6.
Just the figure.
The figure at present is £2.6 million. I will certainly give the entire and very full reply.
