An Bord Bia Bill, 1994: Second Stage.

I move: "That the Bill be now read a Second Time."

I have great pleasure in introducing to the House the Bill setting up An Bord Bia, the Irish Food Board. The origins of this go back to the Culliton report and the report of the Expert Group on the Food Industry which made detailed recommendations on the subject.

I have always been of the view that a greater degree of unity is needed in the activities of State agencies as regards promotion and market development of food products, particularly overseas. A number of our fellow member states of the European Union have single agencies for food promotion which operate with considerable success. I expect that our new single agency will be able to make important progress in maintaining and improving the buyer and consumer demand for Irish food abroad. Once the new agency is set up, I will be asking it to draw up a multi-annual plan for promotion and market development of Irish food. As the Expert Group on the Food Industry suggested, I would expect that plan to develop synergies between the different food promotion activities and to develop also "an overall promotion strategy which, making full use of the Irish image, would have a major impact on markets abroad".

In brief, the Bill proposes in the first instance to combine CBF and the food unit of ABT and to include also certain export promotion functions of An Bord Glas. I have also made provision for the possible inclusion of other relevant agencies' food functions as and when appropriate.

In the drafting of this legislation, I have been particularly careful to maintain the structures, mechanisms and market information systems that have worked well in CBF. Deputies will note that a subsidiary board for meat and livestock is specifically provided for. It is my belief that the activities of both CBF and ABT, as well as An Bord Glas have proved useful and successful in the food promotion area. My aim is to build further on that success. I do not envisage additional Exchequer expenditure arising from this legislation.

Part I contains fairly standard provisions relating to the short title, interpretation of the main terms used, the making of ministerial orders and provision for expenses incurred in administering the legislation to be made from voted moneys. Deputies will notice that "fish" is included in the definition of "agricultural products" in section 2 (1). The main purpose of this is to allow for future assimilation of Bord Iascaigh Mhara's fish promotion functions to the functions of An Bord Bia. A review of the functions of BIM is at present taking place under the auspices of the Minister for the Marine. When that review is complete I will be discussing with the Minister for the Marine whether any transfer of functions in the fish sector would be appropriate.

The Minister will be lucky.

I am advised that the inclusion of fish in the definition will not in any way hinder or cut across the existing promotional work of BIM. With that exception——

The Minister lost that battle.

——An Bord Bia will be responsible for promotion and market development of the whole range of Irish food and drink products.

Part II of the Bill deals with a range of matters relating to the establishment, organisation, procedures and functions of the new agency. Section 6 provides for the establishment of the agency and for the dissolution of CBF on the establishment day to be fixed. I would like to stress here that the dissolution of CBF does not mean that any of that organisation's current functions will be abandoned or lost sight of. As I indicated a few moments ago my purpose is to strengthen those functions. Section 6 (1) provides for an English language name, in addition to the Irish language name An Bord Bia, for the new agency. Experience has shown that an English language title is, not too surprisingly, often desirable in overseas markets.

Section 7 sets out the general functions of the agency. Deputies will have noted that the definition of "food" in Part I includes drink. Thus section 7 will enable An Bord Bia to include beverages in its promotional activities as appropriate. Livestock is included here also with a view, once again, to retaining the current functions of CBF and the equity of its levy system; I recognise, of course, that promotion in the livestock area is at present a relatively minor activity of CBF. Given that products closer to the consumer end of the market have greater promotion requirements, I would not envisage that relative emphasis changing significantly under An Bord Bia.

More specific functions for An Bord Bia are set out in section 8. These cover, among other functions, promotion, market intelligence, market development, symposia, publications, quality assurance and, in brief the whole range of activities appropriate to such an agency. I should mention at this point that the development of markets and the promotion of products is basically the job of those who sell them. The job of An Bord Bia, as in the case of the present agencies, will be to assist and support those efforts in various ways, including strengthening the overall image of Irish food, not to replace them.

Section 9 provides for the transfer of certain functions of An Bord Glas to the new agency. An Bord Glas itself will remain in place; only those of its functions that relate to the export marketing of edible horticultural products are being transferred. As Deputies may be aware, the bulk of An Bord Glas activities relate to the home market and it has substantial work in regard to non-edible horticultural products such as nursery stock; those activities will not be affected.

In the same section, there is provision for assignment to An Bord Bia, at a later stage of other functions related to food marketing. This would cover, for instance, the case where it might be decided to transfer to An Bord Bia responsibility for fish as a food. This power could be exercised only with the consent of other Ministers responsible for bodies from which the transfer of functions might be proposed.

Section 10 allows for assignment of additional functions to the new agency where these are incidental to or consequential on the functions assigned by the Bill.

Section 11 requires An Bord Bia to act in co-operation with other bodies that share functions relevant to its own. What I have in mind in particular is that close and effective co-operation will need to be maintained between An Bord Bia and An Bord Tráchtála, especially with regard to the use of facilities abroad. I intend to ensure that such co-operation takes place.

In section 12 the new agency is empowered to charge for its services. I expect that a base level of services would be provided without supplementary fees for sectors where levies will be collectible by An Bord Bia, though some charge could be involved for special or exceptional services. On the other hand, services to sectors which do not subscribe by levy should be largely on a fee-paying basis. The levels of such fees would be drawn up by An Bord Bia but would, under section 12, be subject to ministerial approval. While I would not wish to see the levels of fees being a deterrent or exorbitant, I would expect them to make a substantial contribution to An Bord Bia's budget.

Section 13 deals with subsidiary boards. I have already referred to the setting up of a subsidiary board for meat and livestock which would maintain and continue the current functions and focus of CBF. This is provided for in subsection (1) of the section which, taken in conjunction with the definition of "livestock" and "meat" in section 2 (1), extends the coverage, beyond that at present in force in CBF, to include deer, poultry, rabbits, goats and the meat of those species. Also, subsection (2) provides for An Bord Bia to set up, with ministerial consent or on ministerial direction, subsidiary boards for other sectors. I am particularly conscious of the recommendation of the Expert Group on the Food Industry that there should be a subsidiary board for prepared consumer food products and this will be among the first of the matters on which I expect An Bord Bia to take action when set up. It is my intention that levies collected from particular sectors, for instance meat and livestock, should be used for the benefit of those sectors. Subsections (1) and (5) together with the right of the Minister to specify conditions under subsection (3) will allow that procedure to be observed.

Section 14 makes the type of provision usual in such cases regarding the composition and terms of office of the board. Deputies will note that a nominee of the Minister for Tourism and Trade is to be included as that Minister is responsible for ABT which will continue to have responsibility for the promotion of nonfood products. The linkage will be in the interests of both agencies.

The Minister won that battle; one up.

I intend also to appoint one member on the nomination of the Minister for Enterprise and Employment.

One down.

As regards section 14 (7), on reflection a period of one year may be too short for those initially appointed for that period. Subject to legal advice, I intend to move on Committee Stage an amendment providing for an initial minimum term of appointment longer than one year. Subject to the same condition, I intend to move similar amendments as regards the terms of office of subsidiary board members under sections 15 (5) and 16 (6).

I intend to set up the board shortly on an interim basis pending the final passage of the Bill. That will enable a good deal of the preliminary work to be done in advance of final establishment and will help to achieve my aim of getting An Bord Bia down to work as soon as possible.

With the Horseracing Authority, the Minister will be busy.

We are keeping the show going. Section 15 deals with the meat and livestock subsidiary board in more detail. It follows closely the present arrangements for CBF. That is part of my policy to preserve in the meat sector the focus and the producer linkages that have worked successfully in CBF. It also takes account of the important CBF levy arrangements that will be carried over into An Bord Bia and the representational pattern which that implies.

Section 16 also deals with subsidiary boards, this time with those that will be set up in sectors other than meat and livestock. Section 16 (2), like the corresponding provision in the previous section, states that the chairman of a subsidiary board shall be a member of the main board. The purpose of this is to ensure effective linkage between the main board and the subsidiary ones. It also reflects a practice which has worked well in CBF, where committees are chaired by board members.

The chairman and members of all the subsidiary boards are to be appointed by the main board, but with the consent of the Minister, under sections 15 (3) and 16 (2). This will enable the Minister to satisfy himself that the persons appointed correspond with the requirement of being "engaged in or having knowledge of" the relevant sector, though it would not be my intention to apply that condition in an over-restrictive way. Ministerial consent will also serve to avoid any danger of an undue proliferation of subsidiary boards.

Sections 17 to 20, inclusive, deal with a number of matters common to the board and the subsidiary boards, such as eligibility of outgoing members for reappointment, conditions of office, casual vacancies and remuneration. Remuneration and allowances for expenses will require the consent of the Minister for Finance.

Sections 21 and 22 cover accounts, audits and annual reports as well as the supply of any information about performance of the functions of the board and of the subsidiary boards that the Minister may require. In accordance with the usual procedure, auditing will be by the Comptroller and Auditor General and the accounts and annual report will be laid before each House of the Oireachtas. Section 23 allows the board to borrow money, but only with the consent of the Minister and the Minister for Finance. Section 24 lays down some framework provisions as regards meetings and procedure within which the board, or a subsidiary board, will be free to determine its more detailed procedures. Section 25 contains stringent provisions to guard against conflicts of interest on the part of members of the board or a subsidiary board or the staff of the agency. Section 26 will prevent incorrect disclosure of information by any of those persons. Section 27 allows investment of funds by the board in the manner of a trustee.

Section 28 provides for the setting up of committees to assist and advise the board or a subsidiary board. This is similar to the existing committee system employed currently by CBF and which has proved useful and effective in practice.

Under section 29 the board and the subsidiary boards are required to comply with any ministerial policy directives. This is a standard provision for bodies of this kind but it would not be my intention to exercise this power in an oppressive way or to interfere in the day to day operations of An Bord Bia. The proper approach when setting up a board is to provide it with a clear framework, as is being done in this Bill, and then to let it get on with the job. Thus, the power under this section would be used only for necessary policy directives.

Section 30 empowers the board to accept gifts, but only if any trusts or conditions attached would not be inconsistent with the board's functions. Section 31 applies to the board, the subsidiary board and the staff of the new agency the standard provisions to cover the situation where a member becomes a Member of either House of the Oireachtas or of the European Parliament.

Sections 32 and 33 enable the board to appoint a full-time chief executive and other staff members with remuneration, allowances, terms and conditions subject to national or governmental guidelines and ministerial directives. Section 34 enables the board, or a subsidiary board, to perform its functions through authorised staff members. Staff matters are dealt with further under section 46 and I will advert to them again at that point.

Under section 35 the board is required to draw up for its staff a superannuation scheme or schemes which will be submitted to the Minister and, after approval, laid before each House of the Oireachtas. Deputies will note that the pre-existing superannuation entitlements of staff transferred to An Bord Bia are safeguarded under section 35 (7).

Section 36 provides for grants-in-aid to An Bord Bia from Exchequer funds, as is already the practice for CBF and ABT. I expect that the greater part of the new agency's resources would come from levies, fees for services and EU Structural Funds, but there will also be an annual grant-in-aid.

Part III of the Bill, dealing with levies on livestock and agricultural products, is largely based on existing legislation relating to CBF, legislation that will become inoperative once An Bord Bia is established and CBF dissolved. As regards section 37 (1), it is necessary to continue the practice of levying both livestock slaughtered and livestock exported in order to observe EU requirements of non-discrimination between these two sectors. The specific amounts of levy per animal shown in section 37 (2) are the present statutory amounts operated by CBF and the present practice whereby those amounts are charged to the vendor of livestock for slaughter is taken up under section 38 (7) of the Bill. It is also present CBF practice, however, to collect a "voluntary", i.e. non-statutory, levy from slaughters and that latter charge is not intended to be passed back to the vendor.

Section 38 (7) and (8) taken together enable the Minister to put the latter non-statutory levy on a statutory basis. It is the intention that this would be done in the event of the voluntary arrangement being discontinued or not working satisfactorily; however, any order varying the current statutory levy amounts would, in accordance with section 37 (4), be subject to a resolution of each House of the Oireachtas as also would any order on recoverability under section 38 (8).

The other provisions of sections 37 to 44, inclusive, relate to what I might call the mechanics of the levy on livestock, such as records, offences and penalties, powers of authorised officers, estimation of levy where necessary and evidence in proceedings. These are similar to existing provisions governing current CBF levy collection except that under section 38 (10) (c) cancellation of the stamps by means of which levies on exported livestock are paid will be effected by staff of my Department instead of Customs and Excise staff as is the case under the existing CBF legislation.

Section 45 provides for a levy on agricultural products. This is to cover the situation where it might prove more convenient or desirable in sectors other than the livestock-meat sector to introduce levy arrangements for promotional purposes rather than to charge fees. An order under this section would require prior consultation with the producer, processor or trade interests concerned, as well as a resolution of each House of the Oireachtas.

I come now to the transitional provisions in Part IV of the Bill. Section 46 means that the initial staff of An Bord Bia would be the existing staff of CBF together with An Bord Tráchtála staff members designated by ABT itself. As regards the latter, the intention would be that the current food unit of ABT would be transferred to An Bord Bia on the establishment day. As I indicated earlier when speaking about section 35, transferred staff will not run a risk of losing out on superannuation rights. Neither will they be at risk as regards their remuneration and conditions of service; section 47 provides that they will not be less favourably treated than before in those respects.

There seems to be an impression among the public that An Bord Bia is to be an enormous organisation; that is not the intention. I see it as a medium-sized tightly-run agency with no more staff than it needs to carry out its responsibilities cost-effectively. I do not anticipate that the transfer of functions from An Bord Glas would necessitate any transfer of staff from that organisation.

In section 48, the central provision is contained in 48 (1) which transfers CBF property to An Bord Bia. The effect of the reference in section 48 (3) to the Finance Act, 1895 is to exempt An Bord Bia from liability for stamp duty in respect of any transferred property.

Section 49 transfers the rights and liabilities of CBF, as well as any pending legal proceedings it might have, to An Bord Bia. As regards the rights and liabilities of ABT in relation to its current food promotion and market development activities, the situation is a little more complex, given that ABT is not being dissolved and that any transfer of rights and liabilities from that agency would therefore be only partial and would have to be apportioned. My Department will be discussing this point further with the Attorney General's Office and I may be putting down an appropriate amendment on Committee Stage. Section 50 provides for the final audited accounts of CBF, after its dissolution on the establishment day, to be laid before each House of the Oireachtas.

The Schedule to the Bill, relating to levy on livestock exported live, deals with the forms of adhesive stamp to show that levy has been paid, as well as the document to which they would be affixed. Deputies may find the colour description "cyan" for 20p stamp rather obscure; it signifies a shade of blue. The schedule is modelled on existing CBF arrangements, as also is the pictorial logo shown; the intention would be to replace the CBF logo by a Bord Bia logo as soon as the latter agency chooses one, and that can be done by regulations under section 38 (11).

Before concluding, I would like to make a further general remark. A rough estimate of the funding available to An Bord Bia over the first few years of its existence would be about £14 million annually, a substantial increase on the present level of funding for food and beverage promotion abroad. This would include an appropriate transfer of funding from ABT, to be carried through administratively. It also takes account of grant-in-aid, livestock levies, and fees charged for services, as well as an element of EU Structural Funds for promotion and market development in the food sector.

As Deputies will have gathered from what I have already said, this Bill aims simply at unifying and making more effective the services provided to the food sector by existing agencies. In that context, the Bill represents a very considerable step forward. Given the challenges that face our food industry following CAP reform and GATT and the need for our food products to compete successfully on the EU market, we must now streamline the back-up given by our State agencies. The Bill has that effect. From my experience of overseas promotions and food fairs — some of which have been well highlighted — a number of Irish agencies locate upstairs, others downstairs and some are not represented at all. Of those who are represented, some promote Irish products under the harp logo and others under the shamrock, leprechaun or other logo. In other words, there is fragmentation. We are a relatively small country with a very strong image. We are perceived as a green island producing quality food, but we have not built on that image sufficiently. The Germans, French and others have central agencies dealing with the export of food who are successful in their work because they have a clear focus on what they want to achieve and use a clear logo to promote foods produced in their countries.

Food produced in Ireland can be given a significant shot in the arm by unifying and streamlining the agencies concerned in a tightly knit operation by allocating substantially increased funding to them. The functional responsibility of An Bord Bia will rest with the Minister of State, Deputy O'Shea, who has been dedicated to supporting the development and promotion of Irish food since his appointment. I commend the Bill to the House.

The Minister is wheeling into the House a Trojan horse whose functions, apart from organising trade fairs and getting the leprechaun, shamrock and harp on the one stand, are far from clear. The Bill is disappointing, not because I disagree with the Minister that a greater degree of unity is needed in the activities of State agencies for the promotion and marketing of food products, but because apart from promotion I fail to see what this conglomeration will do. The view of various sections of the food and drinks industry is that the role in respect of marketing will have to be limited because of the necessity to comply with EU measures. For example, under the Bill the marketing of branded products is unlikely to come within the ambit of this board. The support for generic products is acceptable in a European Union context, but to choose between one branded product and another would mean that the chief executive officer, or whoever on the subsidiary committees about which we have heard so much makes the decision, would need to have the wisdom of Solomon. He or she will have to decide in favour of a branded product from one meat processor as against another, a difficult decision. I take it the days of the grace and favour basis of marketing are over. Successful marketing and selection of branded products at various trade fairs over the years has been questionable and I suspect the Minister would not like that to continue.

The Minister is abolishing CBF even though he made numerous references during Question Time today to its merits. I would question whether making it a subsidiary livestock committee is doing justice to its work over the years. Many of its activities and the manner in which it spent moneys could be criticised, but in general it has done an excellent job. Those who have served on the board of CBF have given excellent service to the meat and livestock trade. I am not convinced the Bill is doing right by that trade — a crucial area of agricultural and agri-food production here — by abolishing CBF and making it a subsidiary committee. The Minister has given all sorts of assurances and bought peace with the IFA on this issue. I ask those who believe the Minister is doing right to carefully analyse the Bill. The subsidiary committee for livestock, the former CBF, will be enabled to collect levies, but it will not have a say in how they are spent. The final say in that regard will rest with the chief executive officer, the boss of the main board. As members of the CBF, the IFA and others appear to believe that the livestock committee will have complete say in regard to the spending of the levies it collects, will the Minister give that assurance to the House? That is not what the Bill says. If the Minister does not amend that section, he will have effectively pulled the wool over the eyes of many intelligent people.

Debate adjourned.