An Bord Bia Bill, 1994: Second Stage (Resumed.)

Question again proposed: "That the Bill be now read a Second Time."

An Bord Bia will incorporate CBF and the food functions of An Bord Tráchtála. It is very important, therefore, that An Bord Bia works closely with An Bord Tráchtála to ensure there is no duplication of marketing and services. I foresee some problems with this proposal. It could lead to duplication, as referred to by the Minister and all contributors to the debate. To put one segment of An Bord Tráchtála under a different agency will pose practical problems and this should be carefully monitored by the Minister.

A number of speakers said it would be sensible to include the marketing functions of Bord Bainne and Bord Iascaigh Mhara in the functions of the new board. There may be reasons for that which the Minister will refer to later, but this would result in various agencies — Bord Bainne is a private company — selling Irish food produce abroad. The Minister said that provision will be made for An Bord Iascaigh Mhara to become involved in this work. Why not make such provision now? I have been in the House for a few years and whenever a Minister says that provision will be made, that is the end of the matter. I do not believe the Minister intends to include Bord Iascaigh Mhara with An Bord Bia.

Will the Minister give the number of major food companies such as the Kerry Group who perhaps seek advice from Bord Tráchtála, CBF or Bord Bainne but who market their own products? What role does the Minister envisage for these companies in the context of a focused marketing drive, the elimination of duplication and the allocation of available resources? Will the new board co-operate with these companies and perhaps farm out some of their marketing functions to them? Perhaps the Minister will refer to these matters when replying.

I noted with interest this year's report of the Kerry Group and I suggest that the Minister read it. It is in favour of the value added product and is looking at new opportunities and markets. It sees marketing, packaging and promotion as strong points and is doing this work itself. No doubt its competitors such as Golden Vale, Dairygold and so on will follow suit.

The Minister referred to employment in the food sector, which declined from about 44,500 in 1985 to 37,000 in 1994. This is due in part to better technology, in many cases grant aided. To improve quality and efficiency we seem to be shedding jobs. In the National Plan there is a commitment to create 9,500 jobs in the food sector in the next five years. Unless we can identify value-added products and different market niches, the opportunities will not exist to create those jobs. There is need for greater marketing and research and I am glad the Minister has made available extra money for research purposes. As a result of lack of funding for Teagasc under Joe Rea in the late 1980s, research almost came to an end. We fell behind countries such as France, Germany and the Netherlands in terms of food production and we lacked opportunities to develop further products in the food industry.

There has been much talk about the global aspect of marketing and selling food abroad, but little mention has been made, even in the Minister's speech, of small operators such as cheese makers on farms in Kerry. I know a number of them. These people experience major problems selling their product in the local market and abroad. I am familiar with one case in which the product is marketed and sold abroad, but most small operators fail due to lack of expertise in marketing which results in reduced possibilities of selling their product, particularly on the British and European markets. Is there provision within the various subsidiary companies for the small operator? The small operator should be assisted in packaging and labelling their produce as it is in this area that many of them fail. There was mention of Farmhouse Pantry in Mayo, a label which covers a range of products from various operators. This label is operating successfully and could be a model for other groups to come together to market their product.

We must look to the future of the agri-food industry in the context of trade growth resulting from GATT — I emphasised this point yesterday evening. Extra jobs will be created only through the production of added value products, which is being undertaken by the Kerry Group. Professor Séamus Sheehy recently said that Irish farmers and agribusiness would need to turn their strategic focus on these opportunities and much of Irish agriculture could compete in more open markets, but we must rethink our attitude to food production.

The penetration of Irish agri-food products in mainland Europe is low. A major effort is needed to improve performance. I hope this initiative will help Irish exporters to increase their penetration of the European market in the context of GATT and the greater opportunities that will present in Europe and throughout the world. However, there will be greater competition from New Zealand, Argentina and other countries who will bring into the market a lower cost product of high quality. There are about 3,000 employees in the Department of Agriculture in New Zealand, most of whom travel around the world selling their product in the marketplace. We will face major competition from these countries. Whereas GATT will present us with great opportunities, if we are to exploit those opportunities we need more products, we need to exploit the market and fight for our niche in the market. I am glad that adequate funding has been provided because, as the Minister is aware, the budget for An Bord Tráchtála this year has decreased by £3 million which will affect the presence of small operators in the marketplace.

Our markets today may not be there tomorrow unless we continue to convince the customers that we are producing quality goods and fight to retain those markets.

I welcome the opportunity to contribute to the debate on this Bill which will set up the Irish Food Board, as it will be known in most countries outside Ireland. A rationalisation with regard to the sales agencies that operate on behalf of this country, particularly in the food sector, is long overdue. I agree with Deputy Deenihan that post-GATT the situation will be much different with regard to competition and the markets we will seek to enter. We should exploit our major advantages.

We have not made sufficient use of our environmental position. We are probably the greenest country in the world with regard to agricultural production but we have not exploited that position. In many European markets Irish products can command a high price but we have a major problem with our seasonal production, particularly meat and meat products. Few of the people involved in that business are prepared to take on customers for a full year. They will supply them when produce is plentiful but when supplies become short, and margins tighten, they will not. The net result is that someone else takes a large share of what should be our markets. It is obvious that certain groups within the food industry, have proved very successful. An Bord Bainne was one of the most successful marketing organisations through the years and it built up a reputation in regard to service, reliability and the quality of the product it delivers. The success of Kerrygold butter in Germany is a prime example of what can be achieved with proper marketing in this area.

Other agencies will become involved as a result of the establishment of An Bord Bia, including CBF. That is a wise decision because we are mainly producers of dairy products, beef, sheepmeat and a certain amount of pigmeat. The other smaller industries associated with the agricultural area such as deer production, etc., are in their infancy and it will take time for them to develop to a point where they can supply a continual market.

CBF has a double role to play, it is responsible for promoting our meat and meat products and exports of livestock. Indeed, perhaps there is a need to consider having a direct connection between the horse industry and the other promotional industries here because that is also another major source of income to farming. People tend to think of CBF from the point of view of its efforts in the area of dead meat sales. We all support that area to the maximum but there is a limit to the type of product that can be sold in processed form and it would be a serious misjudgment of future market trends if we allowed any action to be taken that would diminish our presence in the third country live cattle markets. Indeed, because of our involvement in those markets, we have received dead meat contracts which, in other circumstances, would have gone to our competitors in Australia, New Zealand or the Eastern bloc countries. It is important for those responsible for the promotion of our livestock to remember that there is a role to be played by exporters and those who have been vocal in criticising that area outside this House should consider how much of the product exported live would be of use to the added valud market in Europe. The answer is very little. In regard to our livestock production and our estimates for future production, it is imperative to maintain our presence in the live cattle and sheep market places.

It is now accepted that if it had not been for the competition provided by this market over the past 12 or 18 months, farmers would have experienced serious problems in disposing of the livestock available for processing. This week, some of the factories that claim to be seeking livestock refused to take them from farmers because they believed that prices would decrease further in the weeks ahead. That attitude changed, however, when they discovered that live exporting would resume again in the next week to ten days. I have no doubt that the Minister of State and the officials in his Department will see a role for a proper balance between both ways of disposal. We all wish to see the maximum added value taken from our livestock production but while times have been good in livestock production over the past 12 or 18 months, by the end of the 1990s, we will need to be involved in as many markets as possible for the disposal of our livestock because of increased numbers and the possible changes in regard to subsidies and other income supplements.

The involvement of Bord Iascaigh Mhara is welcome but I hope that in promoting our fishing industry we do not forget the tourism aspect. I am happy that the Department of Agriculture, Food and Forestry, the Department of the Marine and the Department of Tourism and Trade will be represented on this board. That is imperative because we are in the business of doing a co-ordinated promotion of Ireland. Deputy Deenihan pointed out that some groups have been successful in carrying out their own promotion and that has already been seen. The fact that An Bord Glas will be involved also means that the mushroom industry, for instance, which has been very successful in promoting sales of its products abroad, will make a sizeable contribution in regard to what is required to penetrate the markets.

The market development for Irish food and drink products is important also. We are all aware of the success of some of our drink products throughout the world, due mainly to expert marketing and a superior product. We must produce the highest quality product with the maximum added value and emphasise that the product has been produced in a clean environment. We are all health conscious and it is imperative to maintain this status. Anyone involved in damaging the Credibility of our products, agricultural or otherwise, must be treated with the maximum severity by the powers of the State. At one time some of our competitors cast slurs on our products. It is imperative that we counteract these.

The Bill will affect the 37,000 jobs in the food industry. The purpose of the Bill is to enable us to sell a first quality product at a competitive price. We must look at markets outside the EU and see where we are going in the future. Great credit is due to those who market Baileys. It sells in top quality markets because the buyer appreciates the quality of the product. Irish whiskey has found an expanding market.

As regards the appointment of the board, members should have the necessary knowledge to enable them contribute rather than having a vested interest in the industry. Such people could not be objective and would be forced to look at things from their own position. Many suitable people could be appointed to the board who may have retired or who may have moved to other areas.

An Bord Bia has also a role to play in the promotion of food on the home market and in arranging, where possible, for the substitution of imports with home produced products. In some cases we import products similar to those we export and there is something wrong with that. The need for proper promotion is just as important at home as it is abroad. We have an opportunity to set the guidelines for the future development of the food industry. It is the blueprint we will use in the years ahead. We have a reputation to maintain and anyone damaging that should not be allowed to participate in promotions run by An Bord Bia.

We have a large horse industry which should be supported. The showjumping team had major successes in the UK. The industry could act as an ambassador for us. In promoting our country we are entitled to use all available aids. We have many great ambassadors in sport and other areas and involving such people in promotional work would be of enormous benefit to the food industry. Some people have been used for promotional work on the home market and this has proved successful for the companies involved. We should look at the funding of the food industry and its production mechanism. There is need for State and EU funding to enable those involved in the industry to produce superior products.

We will assess An Bord Bia in the years ahead on the market share it has acquired. I have no doubt that those appointed to it will have the well-being of the employees in the industry at heart and will promote Ireland as a producer of food and food products of a quality not produced anywhere else.

I am glad to have an opportunity to discuss this Bill, which I welcome. It is about time our food products were brought together under one body. It might well be that it could be enlarged to An Bord Bia agus Ól. Is that the general idea?

I know BBC commentators have trouble pronouncing long Irish words but they could even have considerable difficulty with two words. Córas Beostoic agus Feola promoted the sale of beef and lamb. During my time as Minister for Agriculture that was their sole area of jurisdiction. Despite our efforts in the Department we could not expand their mandate. However, I am glad to see progress has been made. A few years ago the board's mandate was extended to include pigmeat. It was ridiculous that Córas Tráchtála was marketing some Irish products and the meat board was promoting others. I never understood the logic of that. It is a common-sense approach to bring everything together under one board. Regrettably BIM has not agreed to the inclusion of fish products. I do not understand why that is so.

For as long as I can remember, marketing has been the Achilles heel of Irish agriculture. As a race we do not appear to have great marketing skills. I may be criticised for saying that but it appears to be the case. This is due to the fact that we never really had to sell on the open market. I do not know if this point has been alluded to by previous speakers. Our membership of the EU gave us access to the intervention system whereby products which could not be sold on the open market were placed in intervention; in other words, they were put in stores and the producer got a guaranteed price for them. People did not have to try to sell their products as they still got money for them. Although it was the backbone of Irish agriculture for 20 years, this system was disastrous in many ways. It made us lazy and complacent and we did not have to go out and sell our products, which as every salesman knows, is a very tough job.

We are now in the position where those artificial mechanisms, the intervention system, are slowly and surely being removed through the reform of the Common Agricultural Policy and the implementation of the new GATT deal. For 20 years we enjoyed a system of protectionism for agricultural products but from now on we will have to compete on the open market. It may not yet have dawned on many people, particularly those in the agricultural sector, that some pain will be attached to this. A great deal of pain will be attached to it if we do not market our products efficiently and better than we have done to date.

Ten years ago we depended on two principals, Larry Goodman and Séamus Purcell, for the sale of beef. They did not rely on middlemen or salesmen to sell their products: they met Heads of States and Ministers from other European countries, the Far East and elsewhere and sold their products. We do not have the same structure of market operators which exists in other countries. For example, the New Zealanders are brilliant at selling their product in other countries. They are able to sell their product at a very low price because they do not have support systems such as intervention or subsidies — they got rid of those years ago. If we are not able to sell our products then the food sector and the agricultural industry in general will suffer. We have been sheltered for many years and we are now entering the real world. I am delighted with this very necessary development, we will sink or swim depending on our marketing ability.

I wish to refer to the way the board will be established. I disagree entirely with the concept of giving interest bodies, nominating bodies or whatever one calls them the right to nominate people to a board. This is defeatism, and the Minister should reconsider this aspect of the Bill. From my experience of being in charge of 12 to 14 State boards, it is wrong to allow nominating bodies to put a person on a board without reference to the Minister. The sanction of the Minister should be sought but this does not always happen in practice; once a person is nominated he or she goes on the board almost automatically. This system is disastrous and defeatist. Very often people are nominated to boards as repayment for favours done. This is the worst possible way to constitute a board.

The Minister should nominate the members of the board. It does not matter whether five members of the board come from one organisation while there is no representative of another organisation or whether they represent a sectoral interest. What is important is that the 11 people serving on the board know the food industry and the food business. The best people must be appointed to the board, and the Minister must not be dictated to by pressure groups. If the sectional interest groups to which I referred are allowed to nominate one or two members then we will have a poor quality board and the purpose of the exercise will be defeated.

If the board is not good then the implementation of policies, the selection of personnel and the entire operation will be in dire trouble from day one. I want to get this message across clearly to the Minister. I am sure that like me previous Ministers and Ministers in other Departments have had the same experience in this area. Those of us who were in the Department of Agriculture, Food and Forestry and had dealings with some boards will agree with me on balance. They may not admit this in public but I think they would do so in private: some of them may be afraid of the pressure groups and of being hauled over the coals. However, that is part of life. Having regard to its remit, CBF did a wonderful job in recent years. We could not get a better chief executive than Paddy Moore, an outstanding individual. He is the type of person we need on the board.

Reference has been made to An Bord Bainne. While it has done a good job, its work has not been as competitive as that of CBF. For much of the time An Bord Bainne has dealt in commodity products which are easier to dispose of than consumer products. One cannot sell a consumer product unless the consumer and the public want it, while one can get rid of a commodity product with the aid of EC subsidies. In fairness, it has to sell some commodities on the open market — I do not want to be critical of it — but one has to compete in that market.

The GATT agreement will cause considerable difficulties because we will be competing against New Zealand, Australia, South America, Canada and the United States for the sale of agricultural products. When one considers that the price of beef here is 115p per pound while it is 50p per pound in Australia, 35p per pound in South America and 75p per pound in the United States and Canada one can see that we will have a problem in years to come. Under the reform of the Common Agricultural Policy and the new GATT agreement we will have to compete with producers who can sell beef at those prices. Those in the milk industry will have to compete against New Zealand where milk can be produced for as little as 20-25p per gallon. If our dairy farmers were asked to produce milk for this price most of them would go out of business; they could not operate on that basis.

The dear food policy in the EU suits Ireland. We export 80 per cent of all we produce and it is the massive inflow of money primarily from our agricultural export trade which keeps us going — it keeps cars on the road and enables people to build good quality houses. If we cannot compete with countries able to produce those commodities at a much lower price, we are in dire trouble; that is where marketing enters. If we cannot sell on the open market we are really in trouble. However, we have ability or intuition — I suppose the word is "flair"— if we put our minds to it, we can do it. I have confidence in people's ability to do it but I would not take it for granted. The days of beef mountains, skimmed milk powder mountains, butter mountains, wine and olive oil lakes, are coming to an end. We will no longer have a safety net or be able to dump them into intervention as it was described; we will have to sell such produce.

The present alternative, if people cannot put such produce into intervention, is that they will be given increased headage grants and increased premia for cattle, sheep and other products. Under the GATT Agreement that will end, those grants can be paid for so many years only; we are all sufficiently astute to know that. People have been given the impression by politicians, without naming any, that these payments will continue indefinitely; they will not. I predict they will be almost totally phased out by the end of this century, which is when marketing will come into play. We will then need a strong Bord Bia or, as it will be known worldwide, the Irish Food and Drinks Board, let us not forget the drinks aspect of it.

It is interesting that we have a thriving drinks industry abroad. I know you, a Cheann Comhairle, are not a man for visiting pubs, but you will be interested to know that, at the last count, there were 17 Irish pubs in Paris and that the number is increasing almost daily. Last week I was in Warsaw as a member of the Council of Europe — it was not a junket; it was hard work — where there are now two Irish pubs, a place one would not expect to find them. There are also pubs in Moscow and all sorts of other venues worldwide. For instance, Guinness and Smithwicks sell their product worldwide. There are three or four Guinness breweries in Nigeria; we are not exporting Guinness; they are brewing it out there. As the Minister of State will know, the local drink there is a large bottle of Guinness. I understand they also have breweries in Malaysia where Guinness and Smithwicks, or their subsidiaries, play their part. There is a strange contradiction in that we were the people who created, if that is the correct description, whiskey, uisce beatha and that our Celtic brothers in Scotland can sell 50 to 100 bottles of whiskey worldwide for every one we produce. Perhaps it is a matter of marketing although I think it is more a case of getting the blend right; we tend to deal in malt whiskeys whereas they go for blended whiskeys, not as severe on the palate, which appeal to Americans and others worldwide. Suffice it to say that the product we created is now outselling us by 50:1 or 100:1 worldwide. Those are the vagaries; you win some, you lose some, and we lost out on that one.

A Cheann Comhairle, you welcomed here this morning a delegation from Poland. I mention this to illustrate further the problems that will arise under the GATT Agreement and the Common Agricultural Policy for the food industry. That delegation was here primarily to lobby the Government and politicians about Poland's entry to the European Union. Not alone does Poland want to become a member of the European Union but countries like Czechoslovakia, Romania, the Ukraine, even Russia itself all want to join; even if we do not like it, they will be allowed to enter in the not too distant future because they are part of Europe. Poland is very confident of gaining entry because the Germans want them in. One wonders why bearing in mind the trauma, the financial and social upheaval when Germany was reunited? However, the Germans want a buffer state between themselves and the Russians; history is repeating itself. The chances are that, if the Germans want the Poles in, they will be in which will place tremendous pressures on our food industry because they will be huge exporters of the type of food we produce. There are well over two million farmers in Poland alone, corresponding to approximately one-third of the total farmers in the European Union. When one considers all the farmers in the bread basket of Europe, the Ukraine, Romania, Russia and the other countries I mentioned, this means will we have masses of food, a grossly over-supplied market. It also means we must be able to sell it successfully to survive. Our produce is at least as good as that of other countries but it is not always much better. Perhaps Polish beef is just as good as ours, it depends on taste. Continentals do not like meat containing fat, which means we must trim it off. We must ensure that our animals have that lean, hungry look. It is an open market and we may well be over-estimating the value of our product. However, in future we shall have to sell internationally in competition with goods produced elsewhere cheaper than here. That is why it is so important to have a very good Bord Bia.

I thank the many Members who participated in this debate. I acknowledge the contribution of my constituency colleague and former Minister for Agriculture, Deputy Deasy, and his encouragement of the concept of An Bord Bia. In doing so he also pointed out the difficulties facing the Irish food industry and, in many ways, drew a very realistic picture.

In the time available I will deal with as many as possible of the points raised by Members. It appears there is misunderstanding by some Members, one relates to the distinction to be drawn between promotion and market development on the one hand and selling on the other. As with CBF and An Bord Tráchtála at present, it is the former, not the latter, function that will constitute the area of activity of An Bord Bia. It would be contrary to European Union rules for a State agency to sell a product itself; that is not proposed. The promotion and market development functions of An Bord Bia are set out in detail in section 8 of the Bill. Selling is a matter for the private sector. Many firms will continue to promote their products, as at present, through advertising and other means.

In future when a firm feels the need for centralised back-up in its promotion and market development activities An Bord Bia will be able to provide it for branded or non-branded products. That is what existing agencies do at present but, from now on, it will be done in a unified manner which will exploit the synergies between the markets for different food and beverages. An Bord Bia will also have generic promotion functions.

Another fundamental area in which Deputies seem to be under some misunderstanding is the extent to which the Bill reflects the totality of the recommendations contained in the report of the expert group on the food industry and the nature of some of these recommendations. It is clear from the debate that many Deputies think the objective of the Bill should be to give effect to all the recommendations of the expert group. It is not the intention of the group nor is it necessary that legislation be enacted to deal with every recommendation.

The purpose of the legislation is to give effect to one of the recommendations made by the expert group, that is that a single food promotion agency be established. Contrary to what has been suggested by some Deputies, the expert group did not recommend a full scale food development board. Furthermore, when established, An Bord Bia will be supported by other development strategies recommended by the expert group. Most of these strategies have been embodied in the special Structural Fund sub-programme which the expert group recommended should be drawn up and which is now being examined by the EU Commission. It is worth mentioning also that through that sub-programme, substantial funding will be provided for all the food industry's development needs, including research and development and An Bord Bia.

Some Deputies asked about the position of An Bord Bainne. Despite its title, it is not a State agency but a private firm. The Bill relates to the unification of the functions of State agencies. Currently Bord Bainne carries out a great deal of promotion on its own account but is free to call on the services of An Bord Tráchtála where it thinks appropriate, just as any other private sector firm can. That situation will continue but An Bord Bia instead of An Bord Tráchtála will be the organisation in the food sector.

I was also asked whether there would be a statutory levy on milk for the purpose of An Bord Bia's activities in the dairy sector. As Deputies will be aware, statutory levies apply only on livestock. The Bill gives power to introduce similar types of levies on other agricultural products but I stress that under section 45 this could only be done after consultation with the interests involved and following a positive resolution of both Houses of the Oireachtas. There are, as of now, no plans to introduce such a levy on milk and processors of dairy products will thus be charged fees for services they may seek from An Bord Bia. I hope this clarifies the position in the dairy sector.

On the question of the treatment to be given to fish products the House will agree that pending the outcome of the review of BIM's activities, which is currently underway, it would not be appropriate to transfer any of the agency's functions to An Bord Bia. However, provision is being made in section 9 to enable such a transfer to take place at a later date. In the meantime, by virtue of sections 2 and 11, An Bord Bia will be in a position to provide for the fish sector the same type of service which is currently provided by An Bord Tráchtála.

A number of Deputies raised questions about assigning functions relating to quality assurance, hygiene and safety to An Bord Bia. While section 8 confers specific functions on the new board in regard to quality assurance, the House will agree that it would be inappropriate for an agency whose primary function is promotion and market development also to have a regulatory role in regard to safety and hygiene. Contrary to what has been suggested, there is a very good working relationship between my Department and the Department of Health.

There was a number of questions about An Bord Bia's internal arrangements such as the number of subsidiary boards, levels of staff pay, how various sectors would be dealt with administratively etc. The Minister for Agriculture, Food and Forestry, Deputy Walsh, in his introductory speech said that 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 let it go on with the job. The Bill contains the framework and seeks to avoid what could be regarded as excessive bureaucracy by refraining as much as possible from legislating for internal detail. There is, however, one area where some internal detail is unavoidable and that is in the meat and livestock sector. The requirement here, in line with the report of the expert group on the food industry, is not to lose the functions and arrangements which have worked well in CBF but to transfer these to the relevant subsidiary board of An Bord Bia. That necessitated the transportation of a number of detailed provisions from the existing CBF legislation.

There was a question about the reference in the Minister's speech to the "representational pattern" implied by the carryover of CBF levy arrangements into An Bord Bia. That reference relates only to the meat and livestock subsidiary board, the representative pattern for which is set out in section 15 (3). Deputies will note that section 13 (2) obliges the board of An Bord Bia to set up a subsidiary board when so directed by the Minister and allows it to set one up on its own initiative with the consent of the Minister. The Minister will also have powers to specify functions to be delegated to a subsidiary board. As Deputies can see from section 13 (2) these functions can include both collection and spending of levy proceeds. These provisions are designed to ensure that in the case of the meat and livestock subsidiary board, both of these functions can be carried out by that body.

As regards other possible subsidiary boards, the Minister made it clear that he would expect a subsidiary board for prepared consumer foods to be set up. This is a specific recommendation of the expert group on the food industry. The Minister would intend to allow the main board to formulate views, which he would then consider, as to whether any further subsidiary boards would be established.

I come now to the matter of making appointments to the main board. As I have said, the system of nominations is being retained for the subsidiary board for meat and livestock because of the desirability of carrying over the important elements of the CBF system to that body.

A disastrous move.

It was a recommendation of the expert group.

They are wrong.

When it comes to the main board that consideration does not apply. The functions of the main board are too broad for the nominations approach to be appropriate and the debate has shown that at least some Deputies appreciate that point. The persons appointed by the Minister, as section 14 (5) provides, will be persons having knowledge or experience of the food industry. The intention is to appoint persons of the highest calibre who can make a real contribution. While not nominated by organisations, they will be broadly representative of the various sectors concerned with food. The appointment of members by the Minister follows the practice adopted in the case of other agencies such as Forfás and Forbairt and I am convinced that in this case it is also the best method.

Other questions which have been raised relate to the issues of orders for which an affirmative resolution of the Oireachtas is not required, to the alleged absence of controls on the levels of fees which the board can charge for its services to the arbitrary power of the Minister to fire the chairman or members of the board and to the location of An Bord Bia.

There are three sections in the Bill which empower the Minister to make an order without an affirmative resolution of the Oireachtas. These are sections 5, 9 and 10. Section 5 relates to the fixing of the establishment day and Deputies will agree that this is not an issue which needs to be referred back to the Oireachtas. The two other sections provide respectively for the transfer to the board of functions currently exercised by other bodies and to the assignment to it of additional functions which are incidental to or consequential on the functions already conferred by sections 7 to 9. I do not justify this solely on the basis of what has been done already. In both instances the principles will have already been set and referral back to the Oireachtas should not be necessary.

On the issue of controls over the levels of fees to be charged by the board, the power to charge fees is contained in section 12 (1), but as Deputies will see at section 12 (2) the approval of the Minister for the amounts to be charged is required.

With regard to the so-called arbitrary power of the Minister to fire board members, this is to provide against any contingency in which such a power might prove necessary and it is a normal provision in legislation of this kind.

The question of where An Bord Bia is to be located has been raised several times in the House. The position is that in order to allow the new board the say to which it is entitled in this matter it will not be dealt with until the legislation has been enacted and the board is in place.

During the debate it was suggested that An Bord Bia should have responsibility for certain non-edible products and that this could be achieved by extending the definition of "food". While I appreciate the thinking behind this suggestion, to adopt it would go beyond the limits of credulity. The Attorney General would also have a difficulty with what would be an artificial definition.

On the question of co-operation between the development agency and the marketing agency in the food sector, section 11 of the Bill requires the board to co-operate with other agencies which have marketing functions. While there is no formal provision in relation to co-operation between Forbairt and An Bord Bia I intend to ensure that there is co-operation between the promotion and development agency. The Industrial Development Act, 1993 provides for the establishment of an institutional link between Forfás and An Bord Bia.

Deputy Deenihan referred to small operators. These come within the remit of An Bord Bia. I attach considerable importance to the need to develop niche products. Last year the food unit of ABT concentrated on the independent grocery sector. In the past we concentrated on the multiples and there was a roadshow which moved around Britain. Part of the reason ABT has become more interested in independent grocers is that at present independent stores account for 3 per cent of all sales and 10 per cent of food sales but the graph indicates that by the end of the century they will account for 20 per cent of food sales. By definition, these independent grocers — they are in the main convenience stores which open early in the morning and remain open until late in the evening — attract clients who probably have above average income; they work during the day and like to do their shopping in the evening. This sector has great potential and it is my intention and that of the industry to promote it.

On the question of my approach to the development of the food industry, I am pursuing the strategy set out by the expert group whose report constitutes the most wide-ranging and comprehensive study ever undertaken of the food industry. The group was representative of all sectors of the industry and in the course of its deliberations it examined all aspects of the food industry. These included the problem of seasonality of raw material supplies, over-reliance on intervention and commodity markets, investment aid policy, the institutional framework within which the industry operates and the issue of research and technology as well as the external and domestic factors likely to influence the industry's future development.

At the conclusion of its examination the group made a substantial number of recommendations all with the same basic objective, that is, to promote within the food industry a sustained switch to a consumer oriented policy. The group also set targets against which progress in the achievement of that objective could be measured and it further recommended a more integrated approach towards the provision of development aid and other supports for the industry.

The Government's response to the expert group's report was to authorise the drawing up of a new national programme for the food industry based on the group's recommendations. Work on the preparation of that programme which has been undertaken under my supervision during the past few months is now complete.

The new programme which will cover the period up to 1999 will take the form of a special sub-programme in the next round of Structural Funds. The £7 million funding which I announced some weeks ago for institutional research and development and which relates to one year only represents but a small element of the total amount to be provided under the sub-programme. Pending finalisation of the negotiations with the EU Commission I am not in a position to say precisely what the total amount will be but it will be substantial.

I thank all the Deputies who have taken part in the debate. Their contributions, without exception, were constructive. While there is disagreement on specific points there is a belief in the food industry and in our produce and that we can make progress in terms of job creation in this sector. I commend the Bill to the House.

Question put and agreed to.