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Dáil Éireann debate -
Tuesday, 18 Oct 1994

Vol. 445 No. 9

Milk (Regulation of Supply) Bill, 1994 [ Seanad ]: Committee and Final Stages.

Amendments Nos. 1 and 2 are related. Is it agreed that amendments Nos. 1 and 2 be taken together? Agreed.

I move amendment No. 1:

In page 3, subsection (1), line 35, to delete "substances" and substitute "food ingredients".

The definition of "heat treat milk" in section (1) is amended by the deletion of the word "substances" in line 35 and the substitution of the words "food ingredients" and by amendment No. 2 by the deletion of the word "substances" in line 36, and the substitution of the word "ingredients". This is because the words "other substances" and "substances" respectively, render the definition too wide and, therefore, inappropriate in the definition of a product intended for human consumption. They are purely technical amendments.

Is the Minister satisfied that by making the change from "substances" to "food ingredients" he is not casting the net too narrowly and that anything that may be added in future would come under the definition of "food ingredients"?

The words "food ingredients" are sufficiently comprehensive to be satisfactory in this case.

Amendment agreed to.

I move amendment No. 2: In page 3, subsection (1), line 36, to delete "substances" and substitute "ingredients".

Amendment agreed to.

I move amendment No. 3:

In page 4, subsection (1), lines 6 and 7, to delete "an establishment" and substitute "a holding".

This is another technical amendment.

Amendment agreed to.
Section 1 as amended, agreed to.
SECTION 2.

I move amendment No. 3a:

In page 4, subsection (2), line 20, after "appointed" to insert "or elected".

This is a simple technical amendment to correct an oversight. The Bill provides that all members of the agency will be appointed by the Minister, but within a year an election will be organised so that the registered producers can elect their representatives from among themselves. Thus the agency will shortly have both elected and appointed members and section 2 must reflect that.

Amendment agreed to.
Section 2, as amended, agreed to.
SECTION 3.

I move amendment No. 3b:

In page 5, between lines 29 and 30, to insert the following subsection:

"(7) Each member of the staff shall be furnished with a personal guarantee signed by or on behalf of the Minister covering all guarantees to each transferee, including the right to return to the public service in the event of the failure of the new employer.".

This matter was raised in the Seanad and rejected by the Minister, but clarification is needed in regard to the status of the staff who will be transferred to the private sector. On Second Stage in the Dáil the Minister stated that safeguards will apply in relation to their terms and conditions of employment, including, in certain circumstances, a right to return to employment in the public sector. From reading the Official Report of the proceedings in the Seanad, it is my understanding that people who get into difficulties in the private sector — perhaps their businesses do not succeed — will be free to go back into the public sector. A guarantee in that regard would clarify the matter and ensure that workers are protected. While this has been the subject of considerable negotiation, the Minister's speech did not give such a guarantee. He stated that workers would have a right to return to work in the public sector only in certain circumstances. It is not appropriate for him to avoid this issue when there is a reasonable way to accommodate such a commitment in the Bill. If this is not a reasonable amendment, will the Minister explain why and what he means by the term "in certain circumstances"?

I would be interested to hear the Minister's reply to this amendment. It is my understanding that the 70 or so employees of the Cork and Dublin District Milk Boards who may be transferred to the private sector if the AI, milk recording and mastitis control section is sold as a going concern are guaranteed letters of comfort about future employment. If their jobs in the private sector do not last they will be reabsorbed into the public sector. Will the Minister confirm that if they have not already received such letters of comfort they will do so shortly, that their unions are satisfied that the protracted negotiations, which went on for nearly three years, have been satisfactorily concluded and that no ends are left to be tied up? If the Minister is not prepared to accept Deputy McManus's amendment, will he confirm that the unions are satisfied with what has been agreed?

That is a matter to which you, a Leas-Cheann Comhairle, referred in your contribution, but you must now remain neutral. Employees in the milk industry are concerned about this matter. Lengthy negotiations have taken place and I hope agreement can be reached. I understand that an element of agreement has been reached, but it is appropriate that we should have confirmation of that agreement so that those who have given long and loyal service to the industry are not forgotten and receive adequate compensation or options for further employment. Will the Minister bring us up to date on the position of the employees following this rationalisation?

This legislation was introduced in the Oireachtas several years ago. I gave a commitment then that I would not proceed with it until the staff, through their unions, were satisfied that they had a satisfactory agreement. Earlier this year a satisfactory agreement was reached. The rights of the transferring staff are set out in an agreement reached between the Departments of Agriculture, Food and Forestry and Finance and representatives of the staff under the auspices of the Labour Relations Commission. The agreement contains several pages and is supplemented by numerous appendices and other explanatory documents. Only those aspects of the agreement which require statutory authority for implementation have been taken into account in the Bill. As the guarantee sought does not require statutory authority, there is no need to include a reference to it in the Bill. However, I will put on record the relevant section of the agreement. All members of staff will receive letters in relation to the agreement in the next few weeks. In regard to the guarantee of redeployment in the public sector, the official side guarantees that if the transferred employees are compulsorily made redundant within the meaning of the redundancy payments Acts they will be redeployed forthwith in the public sector. Prior to the transfer, the Department of Agriculture, Food and Forestry will furnish to each employee transferring to the new enterprise a formal written undertaking that in the event of his or her being made redundant, redeployment in the public sector, as specified at section 4.3 of the agreement will be among the options open to him or her. The names and grades of all transferring employees will be registered in the personnel division in the Department of Agriculture, Food and Forestry.

This agreement was reached to the satisfaction of all the staff employed, under the auspices of the Labour Relations Commission. For that reason it is unnecessary to include selective provisions of the agreement in the legislation. As that might lead to confusion and suspicion, I must reject the amendment. I again confirm that I will send a letter to each employee confirming what I have just put on record.

I agree that people are satisfied with the principle that they can come back into the public sector, but that might not hold if a new Minister is appointed or the board decides it is not satisfied with the agreement. It would then be necessary to have new negotiations.

If this is a cast-iron guarantee there is no reason the Minister should not include it in the provisions of the Bill. That would clear up the doubts of workers who are concerned, not about the fact that the agreement has been made, but that it is not inserted in the Bill. I commend the Minister for his efforts in reaching this agreement, but it is illogical to claim that it cannot be inserted in the Bill. That would reassure people for the future as well as for the present.

This agreement did not involve the Minister. It was reached between the Departments of Agriculture, Food and Forestry and Finance, on the one hand, and the staff, under the auspices of the Labour Relations Commission, on the other. They had all the time in the world to negotiate and reach agreement and they did so earlier this year. They communicated that agreement to the Department of Agriculture, Food and Forestry, allowing me introduce the Bill. To copperfasten the matter I have put the relevant section of the agreement on the record. Adequate gilt edged guarantees have been given to the staff about future employment and people should not be concerned in that regard.

Amendment put and declared lost.
Question proposed: "That section 3 stand part of the Bill."

What exactly do the words "choses in action" mean in section 3 (4) (a), line 2 on page 5, since I do not have a legal training?

It means legal proceedings.

Is it possible to use terminology more readily understandable to the average person, or is there a precedent that we render it as obscure and obtuse as possible?

Question put and agreed to.
NEW SECTION.

I move amendment No. 4:

In page 5, before section 4, to insert the following new section:

"4. The Agency shall promote the sale by processors of heat-treated liquid milk in returnable containers by—

(a) setting targets for the proportion of heat-treated liquid milk to be sold in such containers, and

(b) monitoring the achievement of such targets by processors."

I tabled this amendment because it is time we faced up to the waste mountain building up, not just in Ireland, but right across Europe. The establishment of the National Milk Agency affords us an opportunity to take responsibility for what happened in relation to liquid milk and containers used at present. In the past, generally milk was sold in bottles which were environmentally friendly, reusable 20 or 30 times, the kind of containers that people who are concerned about the environment are now promoting very heavily and are now acceptable across Europe as constituting the way forward to improve environmental protection. The establishment of the National Milk Agency affords us an opportunity to begin to work the process in the right direction. To date all the movement has been towards disposable containers, away from reusable ones, with only 11 per cent of milk at present being sold in reusable containers.

While the Minister may say responsibility lies with the Department of the Environment it is everybody's responsibility to face up to what is happening and to reduce the damage to our environment. Unless action is taken across the board by all Departments to meet the demands of environmental protection, we will end up doing lasting damage to the world. I tabled this amendment believing that the National Milk Agency has an opportunity and indeed obligation to set the trend. I know the Minister for the Environment will produce a waste management Bill shortly. Already a document has been produced on recycling strategy which says all sorts of nice things but does not stipulate how the goals will be achieved. I recommend that the Minister adopts this approach, a very modest proposal, that the agency be given responsibility to promote the sale of milk in returnable containers thereby setting targets for the industry. Again, this cannot be done by legislation only or imposing penalties; it must be done by agreement, on the part of processors in particular, by the retail segment of the industry, because the present interests of the retail sector in particular is to get rid of bottles, simply creating the waste mountain to which I referred earlier.

I do not agree with Deputy McManus because, with the exception of one of the Dublin dairies, most dairies and distributors distribute packaged milk, in plastic or Tetrapak containers and some of them have spent massive amounts of money installing the type of equipment necessary for such containers, most of which are disposable.

They are not biodegradable.

No, Tetrapaks are a completely different commodity. Indeed, if they were biodegradable, in all probability——

If one cannot recycle them, they are not biodegradable.

Delivering milk in glass bottles is cumbersome and from the point of view of hygiene Tetrapaks are preferable. I would go so far as to say it would be a retrograde step to deliver milk bottles which are returnable and necessitate washing, bearing in mind breakage and general damage. Indeed in windy weather in Dublin milk roundsmen experience difficulty with milk bottles falling or rolling about. Therefore, I do not think one can compel the use of milk bottles against other types of containers, particularly when it will have cost some dairies and distributors so much to install the requisite equipment for the latter.

Deputy Leonard should inform the Minister for the Environment of his position.

I reject this amendment for a number of reasons. It is not the purpose of this Bill to promote any particular type of package for milk. While I appreciate her concern about the protection of the environment and the conservation of natural resources, this Bill is not the appropriate vehicle for addressing such issues.

Glass bottles are very nice in many ways as one can see that the milk contains a certain percentage of butter fat, which was very useful in the old days when the skimming of milk was practised by some operators. However, they also have shortcomings. Deputy McManus spoke on Second Stage about a roundsman getting perhaps 20 or 25 trips per bottle. While some people may be very good at returning bottles, and, while some might well wash the bottles properly, others might not. In addition, those bottles were used from time to time for holding liquids other than milk. For example, I well recall holidaymakers leaving them beneath caravans, mobile homes, when they grew mould and propagated insects. Indeed automatic washing systems in plants were not terribly good at getting snails out of bottles and consumers regularly became ill because of foreign bodies in milk bottles resulting from perhaps one trip too many.

The Minister is talking from experience of a certain plant in Cork——

I certainly am.

——who may not be too pleased with him.

Another major limitation is the fact that one cannot readily sterilise them.

The requisite technology is there.

One can sterilise babies' bottles which are also made of glass.

On Second Stage Deputy McManus said it would be very useful to have long-life milk. Of course, modern packages lend themselves to long-life milk and cream. Deputy Leonard would know all about it because Killeshandra pioneered that project. There is one further shortcoming to the use of milk bottles, which is that in the case of doorstep deliveries, the tops in aluminium foil constitute a polluter. Birds, who rise earlier than householders, have a habit of picking the foil tops off the milk bottles and helping themselves to a fair protion of the most lucrative part, the cream at the top.

Therefore, for many of those technical reasons, I reject this amendment.

Amendment put and declared lost.
Section 4 agreed to.
SECTION 5.

Amendment No. 5 in the name of the Minister. Amendment No. 6 is related and it is suggested that both amendments be taken together.

I move amendment No. 5:

In page 6, subsection (1), line 38, after "sold" to insert "or supplied".

Amendment agreed to.

I move amendment No. 6:

In page 7, subsection (4), line 13, after "sells" to insert ",supplies".

Amendment agreed to.

I move amendment No. 7:

In page 7, subsection (6), line 22, to delete "two months" and substitute "on a date laid down by order of the Minister".

Amendment agreed to.
Question proposed: "That section 5, as amended, stand part of the Bill".

Section 5 (5) states:

A person who continues to contravene any provision of this section after conviction of the original contravention shall be guilty of contravening the provision on every day on which the contravention so continues and for each such offence shall be liable on summary conviction to a fine not exceeding £200.

Is it the case that a fine of £200 applies in respect of each day the person contravenes a provision of the section and, if so, should the words "for each day" be inserted to make the position explicit?

The fine of £200 applies in respect of each day.

I am concerned that if an offence was committed for a period of six days or two weeks and was dealt with in one day, it might be interpreted that the total fine payable was £200 rather than £200 per day.

The fine is £200 per day. I would not have any difficulty in accepting an amendment Deputy Doyle might wish to include to clarify the fine applies in respect of each offence.

I would like such an amendment to be included. As all stages are to conclude by 7 p.m. we should agree on the wording of the amendment now.

I will ask my officials to draw up an appropriate amendment before the Bill is taken in the Seanad. I do not believe that would involve a technical difficulty.

We should avoid ambiguity.

Section 5 deals with the regulation of milk supply in the Twenty-Six counties. Given the provisions of that section and the concept of the registration of contracts in the next section — which I fully support and which is perhaps one of the most important sections in the Bill — how will we regulate milk supply if in the spirit of free trade in the European Union and the single market it is perfectly legal to import milk from any member country, although in practice it would be imported only from the North of Ireland? What provisions exist to prevent milk, including milk for manufacturing purposes, being imported from the North? As long as it meets the necessary quality criteria it can be used in liquid milk supply, particularly in the winter months when there is a scarcity or a temporary hiccup in supply in an area. While hours and years of work have gone into the preparation of this Bill — this is the third attempt to introduce such a Bill in four years — we still do not have any control over the importation of milk. How can the provisions in section 5 governing the regulation of milk supply and the registration of contracts for milk supply which we will discuss in the next section be squared with the reality of the position?

I was disturbed to be told by the ICMSA, one of the main producer groups, that in its view the Bill will not work. I was taken aback at that because I understood we all agreed that, with the exception of a few detailed amendments, the Bill would be in everybody's best interest. It is not that the ICMSA does not support the introduction of this Bill. It does not consider it will not work because we do not have control over milk being imported from the North into the South. It will not be possible to stop the milk being used whether for manufacturing or liquid milk supply as long as it meets the quality criteria. The contract business is negated if milk can be imported willy nilly from across the Border. In the South there is a prohibition on buying milk from manufacturers. This Bill will tie that down very tightly, but we cannot prohibit the buying of milk from manufacturers across the Border. If we cannot control the flow of milk from manufacturers in the North to liquid milk suppliers in the South what is the point in pretending that we are controlling the position by registering contracts and the regulation of milk supply? I am somewhat concerned about those matters.

Importers from the North could abuse their dominant position when a minimum price order is not in place and the Competition Act has removed price controls on the sale of milk in supermarkets. If importers from the South can buy milk from the North for manufacturing purposes in times of scarcity to supplement their liquid milk supply, assuming it meets the quality criteria, that milk could then be sold at a cheaper price per litre on the supermarket shelves than milk manufactured for consumption in the South through the liquid milk supply system. There is a great anomaly in this area which I have not yet heard addressed. Because of the extra costs of liquid milk production I understand the necessity to tie liquid milk processors to liquid milk producers, but in times of scarcity will they not seek out manufacturing producers in the North to augment their supply?

The purpose of the Bill is to ensure an adequate supply of milk to consumers in our cities and towns. It is proposed to do so by drawing up a contract between the liquid milk producers and processors or a liquid milk bottling plant. That contract will have to have regard to the production of milk all the year round, particularly in the winter months when milk tends to be more scarce and producers or milk suppliers will have to be adequately compensated for its production. There is not any real difficulty about milk being imported from the North of Ireland, the UK or European countries to ensure urban supplies. However, there is a problem for our processors and our farmers even though we are part of the single European market. We export 80 per cent of the milk we produce in products, such as butter, powder and casein and various ingredients. If we export 80 per cent of what we produce we cannot very well put a barrier against imports. However, as we have an efficient system of farm production and dairy processing, I do not have any fears about our industry at farm and processing level withstanding milk imports.

The purpose of the Bill is to ensure an adequate all year round milk supply of a quality at least up to the European standard and higher if possible. Most of our milk suppliers produce milk of a higher standard than that laid down under the European Directive.

The Minister has said in effect that there is absolutely nothing he can do about the problem of milk being imported from Northern Ireland. A large quantity of milk is utilised in the liquid milk trade without the imposition of controls. The provisions of the Bill will not necessarily mean that farmers will be guaranteed a reasonable price for their milk when it can be imported from elsewhere. This is a serious problem, especially in the Border counties where the marketing structure can be undermined. Under the proposed regulations in this Bill processors and farmers will be subject to another layer of bureaucracy but they do not have any guarantees. A processor told me today that two inspectors from two different sections had called to see him and he wonders if, as a result of the passing of this legislation, more inspectors will call next week. Yet the Bill may not benefit him.

I doubt very much if there were any inspectors out as a result of this measure because we have not processed it through the House and it has to go to the Seanad. However, there are inspectors to ensure that the hygiene, quality and refrigeration standards on farms meet the requirements of consumers. We should make no apology for that. Consumers are entitled to milk of the highest standard, and they are getting it now. Only a few weeks ago we made grant aid available to improve hygiene in premises to meet the requirements of Directive 92/46.

We cannot put technical controls on milk or milk products coming into Ireland. Quite an array of cheeses and milk products are being imported into this country from all over Europe as well as some milk from the North where some processors have links with co-operatives in the South. Waterford and Golden Vale in particular have some involvement with co-operatives in the North. We talk about this island we are living on and the fact that we, both in the North and South, have a common interest in these matters so there is no way that we could put a barrier on milk coming here from the North. I have absolute confidence in the ability of our milk producers and co-operatives to cope with imports from any part of the North or from Great Britain itself.

Will the Minister be able to guarantee that the standards applied to milk produced here will also apply to all imported milk?

There is substantial movement of milk southwards for processing. I meet the trucks on a daily basis in my constituency, bringing milk to the processing plants. That product has been capable of competing against the Milk Marketing Board which was not as efficient as we used to think years ago. We used to think the Milk Marketing Board was the be all and end all of everything but it was left behind by the larger co-operatives. Would it create problems at EU level if we refused to allow a milk roundsman or milk distributor from the North to come across the Border to sell milk on the doorsteps or in supermarkets? I can see that happening. We are moving across the Border with our bread. Years ago there was no such thing but now there is free movement of bread; Pat the Baker must be supplying most of the North at present. That is the trend and I fear the same will happen if an opportunity arises in regard to milk distribution.

My question relates to the quality of milk, particularly milk from the North. I raise this matter because in the mid-1980s there were many scares emanating in the Dublin area about the quality of milk. I am glad this Bill is going through but I would like an answer from the Minister about the question of milk from outside the Republic.

There is concern, because the co-operative movement is not as strong in the west, that the milk quota system might be lost to that region. The Minister has done much under the restructuring schemes to keep milk in the western pool but there is concern about milk leaving that region going to the south and the south-east because farmers are getting out of milk for various reasons, among them being the fact that the hygiene regulations create so much expense. I am sure the Minister supports the efforts of the co-operatives to strengthen their own base in the western region and I would like him to keep that milk quota available for other farmers who want to enlarge their quotas.

Deputy McManus asked for an assurance that the quality of imported milk would be up to standard. I can so confirm. Under Directive 92/46 all milk throughout the European Union will have to be up to that minimum standard and all the packs, trucks and containers will have to have that guarantee stamped on them. The vast majority of Irish producers are way ahead of that standard in terms of the various bacteriological requirements. There is, therefore, a guarantee of the quality of milk.

The question of milk leaking from the west is a matter for regulation and does not come within the terms of this Bill. However, the matter is being taken in hand. In fact, some people in the southern part of the country not too far from myself helped themselves to quotas in recent times——

Will the Minister be ring fencing quotas in certain regions?

There is no danger of them moving to Cork in the next few weeks?

Enough notice to get Cork to fill up their supply.

A drop of it would not go astray in the South-Central and North-Central constituencies.

This Government is well qualified to look after its pals.

Section, as amended, agreed to.
SECTION 6.

I move amendment No. 7a:

In page 7, subsection (2) (a), line 33, after "consumption" to insert the following:

",however, where a producer accidentally fails to meet the said quality standards, the contract shall provide for a reasonable period for recovery time to allow the producer return to the said quality standards".

It goes without saying that I hold no brief for anyone who abuses the system and who persistently fails to meet standards rightfully demanded by the consumer. While the registration of contracts is perhaps the most important section of the Bill we must carefully handle situations where there has been a breach of contract. A one off breach should not be treated in the same way as systematic breaches of the required standards. That is why I ask the Minister to consider inserting this clause to cover the case of a producer accidentally and exceptionally failing to meet quality criteria of one kind or another. That producer should be given a reasonable time to recover his or her normal standards without having his or her contract systematically terminated. We should distinguish between the one off situations or accidents and cases where people just flout the standards and refuse to meet criteria of one kind or another. I urge the Minister to accept my amendment.

The contract between the milk producer and the dairy is a commercial matter beyond the remit of the new agency. The agency will register only those contracts which specify quality and hygiene standards at least equal to those provided under European Union Directive 92/46. The setting of higher quality standards is a matter between the producer and the dairy. The quality standards under Directive 92/46 in so far as they relate to total bacterial count and somatic cell count levels in milk allow for a recovery period of two to three months. Earlier this year I published details of how these standards would apply in practice and the arrangements I put in place then were, by and large, acceptable to the dairy industry while fully protecting the interests of consumers.

I emphasise that this Bill is not setting the quality standards of milk. It relates only to the supply of milk to consumers and regular supply, particularly in winter, and provides that supply must conform to existing European Union quality standards. While I understand the reason for Deputy Doyle's proposal I cannot agree to the amendment on the basis that the matter is not appropriate to the function of the milk agency and therefore is not relevant here.

Farmers dealing in liquid milk over the years were generally paid a little extra for their milk and kept their premises up to a very high standard. In practice there is little difficulty in this area. However, if there was a wedding or a wake in the house there might be nobody to milk the cows except a stranger or a young person and the milk arriving at the creamery might not be up to standard. In those circumstances there would be no option but to reject the milk as it could not be passed to the consumers, who would not get it until the following day or perhaps two days later. Nowadays people expect milk to last for four or five days. We cannot tolerate sending sour or contaminated milk to dairies. Contaminated milk usually goes into the animal feed system when it is returned to the farmer. It is most unusual for this problem to arise and it is expected that milk is of the required standard. Almost all dairies employ a milk quality adviser who calls to the farmer if there is a problem with the milk supplied. He inspects the milking parlour for a breakdown in the system. Consumers must be protected in this matter and for that reason I cannot accept the amendment.

I hope I was not understood to suggest that milk produced during a breakdown in quality control should be passed on to the consumer. I was referring to the contractual position, the effect of a once-off breach in standards and how much time would elapse before the contractual relationship was restored. We should distinguish between the unsuitability of a person to hold a contract to supply liquid milk and a once-off breach in a case such as that given by the Minister — my amendment proposes to address that aspect. If, as the Minister stated, it is a matter that cannot be addressed under the Bill but is a matter for European regulation or one to be sorted out by the agency and those involved, I accept that. However there are concerns among producers — farmer groups have come to me with concerns about this aspect — that the habitual transgressor of contractual requirements is treated in the same way as the unfortunate person who experiences a once-off breakdown in quality control. There is a need to protect the producer with the once-off difficulty as distinct from the person who continuously causes trouble.

I understand the reason for the Deputy's amendment but I expect that matter would be attended to in drawing up the agreement between the farmer and the dairy. If there is a crisis in a family and a person makes a mistake he could hardly be thrown out of the creamery for that reason. However the position is different in the case of a persistent careless defaulter who has no interest in the final destination of the product. I expect this will be dealt with in the agreement.

Amendment, by leave, withdrawn.

I move amendment No. 7b:

In page 8, between lines 18 and 19, to insert the following subsection:

"(5) The Minister or the Agency may specify the minimum price to be paid to producers.".

In this amendment I propose to enable the Minister or the agency to specify the minimum price to be paid to producers. I suspect the Minister will quote the Competition Act and various regulations dealing with this matter. There is concern, particularly in the scenario we discussed in the previous sections, that if manufacturing milk from the North, which is much cheaper than liquid milk, can be brought South and used in liquid milk processing and in producing milk drinks it can hit the supermarket shelves at a cheaper price than the higher cost — for understandable and acceptable reasons — milk produced and processed in the South. That point has been put to me to protect processors and to ensure that we avoid the abuse of a dominant position generally.

There should be an enabling measure whereby the Minister or the agency could fix a minimum price for milk. I would like the Minister's views on that matter. It is not in the interests of the consumer to have a price war if at the end of it people are driven out of liquid milk production and the stability of a 12 month supply, particularly in urban areas, is upset. I envisage a great problem with manufacturing milk from the North coming to the South, enabling the litre of milk to be sold at a cheaper rate in our supermarkets, particularly in the northern parts of the country. Perhaps my amendment could be accepted in some form to provide an enabling measure whereby, if necessary, a minimum price could be put on the litre of milk.

The milk agency will seek to ensure an adequate supply of milk to consumers all year round. It was not envisaged that the agency would fix a minimum price. The reason the old milk boards were abolished was that the European Union found their mode of operation contrary to European Union law. For the new agency to be so empowered would also be contrary to European competition law. Given that it is the same body of law that caused the Commission to raise questions about the continuation of the old milk boards, it would make little sense to replace those boards with an agency which would also fall foul of the same European Union law.

Among the conditions for the registration of a contract under the Bill is a requirement that the price stipulated provides, in the opinion of the agency, adequate compensation to the producer for raw milk supplied, taking into account in particular the cost of production during winter. This cost may vary from one part of the State to another or even from one producer to another depending on the scale of operations. Thus it is totally different from a statutory minimum price. The fixing of a statutory minimum price is contrary to European Union law. For some time people have supplied milk to Cork, Dublin, Galway or Belfast from any part of the island, there is no bar. Traditional suppliers continue to supply milk door to door or to the supermarkets because we have an efficient milk industry and I have no doubt this will continue.

Amendment, by leave, withdrawn.
Section 6 agreed to.
Section 7 agreed to.
SECTION 8.

I move amendment No. 8:

In page 8, subsection (2) (a), between lines 47 and 48, to insert the following:

"(ii) the total quantity of milk acquired for the production of milk for liquid consumption, and".

Amendment agreed to.

I move amendment No. 9:

In page 9, subsection (7), line 41, after "register" to insert "of producers or processors as the case may be and the registration of any and all contracts to which that person is a party".

Amendment agreed to.
Section 8, as amended, agreed to.
Section 9 agreed to.
SECTION 10.

I move amendment No. 10:

In page 11, subsection (3), between lines 3 and 4, to insert the following:

"(d) prevents the inspector from taking copies of records or documents or extracts therefrom in accordance with subsection (2) (b), or".

Amendment agreed to.
Section 10, as amended, agreed to.
Section 11 agreed to.
SECTION 12.

I move amendment No. 11:

In page 11, subsection (2), lines 41 and 42, to delete "at registered premises" and substitute "by a registered person".

Amendment agreed to.

I move amendment No. 11a:

In page 11, between lines 46 and 47, to insert the following subsection:

"(3) Registered contracts shall be tradeable in their own right, independently of the transfer of business. The person to whom the contract is transferred shall apply to the Agency, in such manner and form, and containing such particulars as the Agency may require to have his/her name inserted in the appropriate register in lieu of that of the person previously registered.".

The purpose of this amendment is to allow registered contracts to be tradeable in their own right, independently of the transfer of business. I welcome the provision in the Bill which will allow the transfer of contracts to a third party on the death of the owner or the transfer of ownership of the registered business. I would like the provision outlined in the amendment inserted as it would allow a registered producer to transfer ownership of contracts independently of the possible transfer of ownership of the farm or business generally.

This trading of contracts is currently practised, particularly in the Dublin Milk Marketing Board area, and guarantees the commitment of the dairy farmers involved in liquid milk production as well as the consistent quality of the milk produced. This amendment would round the section off.

In this situation the contract is a legal agreement between the two parties concerned, the dairy and the milk producer. It is a matter for them to agree the circumstances and conditions under which their rights and duties under the contract may be transferred to a third party. In other words, in drawing up the agreement with their legal representatives they can insert various conditions but it is not envisaged that the agency will become involved in this area of activity. It is only when a producer has entered into a contract with a dairy that the agency will become involved and register the contract. For this reason I reject the amendment.

As time is running out I do not want to delay the House. The reasons the Minister has given for rejecting my amendment could also be applied to subsection (2). It is a matter for the legal representatives of the producer and the agency to agree the terms of the contract. One could delete subsection (2) for the same reasons the Minister has given for refusing to accept the amendment. It is important that registered contracts should be tradeable in their own right, independently of the transfer of business or the transfer of contracts on the death of the registered owner to ensure that contracts remain in the hands of those who are most qualified to produce.

Subsection (2) states:

Where the ownership of any business carried on at registered premises has been transferred to another person, the Agency shall on the application of that person, made in such manner and form and containing such particulars as the Agency may require, insert in the appropriate register the name of that person in lieu of that of the person previously registered.

I suggest that an exact template of that subsection should be added so that the contract may be transferred on the death of the registered owner or when the business is transferred and regarded as a tradeable asset in its own right. This seems to be perfectly logical.

The purpose of this Bill is to ensure the registration of contracts and the supply of milk. We do not have any problem with the details of the contract or people inserting provisions to ensure that the contract may only be transferred on the death of the registered owner to a member of the family and that it will be tradeable——

The Minister has no difficulty with the independent trading of contracts?

No, but it is a matter for the agency.

As that has been made clear I rest my case but the logic escapes me. As the Minister is including a provision relating to the transfer of ownership of a business I fail to understand why he will not accept my amendment. As he accepts the principle that the practice of trading contracts independently, apart from farms and businesses, subject to the normal legal requirements, can continue I am happy.

There is no difficulty.

I have difficulty with the idea of people selling land but retaining the contract. I understood that the purpose of the Bill was to set down guidelines. I do not think that people should be allowed to retain what is a valuable asset; it should be tied to the holding. I do not agree with the Deputy's thinking on this matter.

This has been the practice for many years in the Dublin Milk Marketing Board area. I am not as familiar with the position in the Cork Milk Marketing Board area.

We have been trying for nine years to get rid of that board with its tactics and its modes of operation——

The Deputy is not.

Let us have a proper discussion by Members.

The Minister in another guise, in another walk of life, in looking after the Cork area, pursued this matter. The Minister confirmed that the practice of trading contracts as an independent asset can continue subject to the normal legal requirements. That is all I wanted to establish and I accept the Minister's point.

Amendment, by leave, withdrawn.
Section 12, as amended, agreed to.
SECTION 13.

We now come to amendment No. 12. Amendments Nos. 13 and 14 are related. I suggest, therefore, that we discuss amendments Nos. 12, 13 and 14 together.

I move amendment No. 12:

In page 12, subsection (3) (f), line 16, to delete "Directive." and substitute "Directive, or".

Amendment agreed to.

I move amendment No. 13:

In page 12, subsection (3), between lines 16 and 17, to insert the following:

"(g) in the case of a registered producer, that producer fails to supply the quantities of milk specified in a registered contract as being due for supply during the winter months.".

Amendment agreed to.

I move amendment No. 13a:

In page 12, subsection (4) (a), line 21, after "liquidator" to insert ", receiver".

Amendment agreed to.

I move amendment No. 14:

In page 13, between lines 9 and 10, to insert the following subsection:

"(9) A producer whose registration is cancelled in pursuance of subsection (3) (g) shall not be eligible for re-registration by the Agency for a period of at least two years from the date of such cancellation.".

Amendment agreed to.
Section 13, as amended, agreed to.
Sections 14 to 20, inclusive, agreed to.
NEW SECTION.

I move amendment No. 15:

In page 16, before section 21, to insert the following new section:

21.—Offences under sections 5, 8, 9, 10 and 15 shall be brought and prosecuted by the Agency.".

Amendment agreed to.
Section 21, as amended, agreed to.
Sections 22 and 23 agreed to.
SCHEDULE.

Amendments Nos. 16 and 17 are related and I suggest therefore that we discuss them together.

I move amendment No. 16:

In page 16, paragraph 1 (4), line 39, after "through" to insert "absence,".

Amendment agreed to.

I move amendment No. 17:

In page 16, paragraph 1 (4), line 42, after "proper" to insert "and references to the Chairman in the subsequent provisions of this Schedule shall include the person so acting".

Amendment agreed to.

Amendment No. 18 in the name of Deputy McManus is related to amendment No. 19 and I suggest that we discuss amendments Nos. 18 and 19 together. Is that agreed? Agreed.

I move amendment No. 18:

In page 17, between lines 12 and 13, to insert the following paragraph:

"5. The total number of ordinary members nominated or elected by producer and consumer interests shall constitute not less than half of the total membership of the Agency.".

I ask the Minister to accept this amendment. There is a rather curious reference in the Bill to the "appropriate number of first ordinary members" nominated on the advice of the various groups. That surely is open to very broad interpretation. While I accept the bona fides of this Minister, it is extraordinary that there is no firm structure to define what an appropriate number is. My amendment seeks essentially what the Minister committed himself to in the Seanad when he outlined what he perceived as the appropriate number. There is no conflict between what he perceives as the appropriate number of ordinary members and what I am putting forward in my amendment relating to producers and consumers.

I ask the Minister to enable that principle, which he feels is appropriate, to be incorporated in the Bill to ensure that other Ministers follow his good example.

I support the points made by Deputy McManus. All members other than producer members are to be appointed by the Minister on the nomination of processor, distributor, retailer and consumer interests. We do not have time to go into what the Minister has in mind — perhaps he is thinking in terms of panels of three, ensuring that one member wears a skirt. The representatives from across the Border will be asked to keep an eye on what we are doing down here. I do not have time to compare what the Minister has done in this Bill with other recent board appointments but there is no reason the same arrangement could not be used on a permanent basis for producer members of the agency as for all other interested parties that will be represented as members.

I would like the Minister to lay down the relative proportion of the membership from the various interests, ensuring that producer members should constitute at least half the membership.

I have had wide-ranging consultations with the various interests involved and following those consultations with producers, consumers, processors and roundsmen we have come up with this agreed solution to this problem. It is the intention that the various interests involved in production, processing, distribution and sale of liquid milk for consumption, as well as consumers themselves will have a voice in the new agency. However, since the balance of interest may change over time it is not considered prudent to specify the numbers or set proportions for representation of the various interests in the Bill itself. It is considered desirable to allow for flexibility in the numbers representing each category. With regard to whether producer representatives should be elected or appointed, let me say that I would prefer the democratic system.

A late conversion.

How long does the Minister intend to stay in his position?

For some considerable time.

I would not bet on it.

Amendment put.
The Committee divided: Tá, 32; Níl, 52.

  • Allen, Bernard.
  • Barrett, Seán.
  • Barry, Peter.
  • Bradford, Paul.
  • Browne, John (Carlow-Kilkenny).
  • Bruton, Richard.
  • Byrne, Eric.
  • Carey, Donal.
  • Clohessy, Peadar.
  • Crawford, Seymour.
  • Crowley, Frank.
  • Currie, Austin.
  • Deasy, Austin.
  • Deenihan, Jimmy.
  • Doyle, Avril.
  • Durkan, Bernard J.
  • Fox, Johnny.
  • Gregory, Tony.
  • Higgins, Jim.
  • Kenny, Enda.
  • Keogh, Helen.
  • McCormack, Pádraic.
  • McGahon, Brendan.
  • McGrath, Paul.
  • McManus, Liz.
  • Mitchell, Jim.
  • Molloy, Robert.
  • O'Donnell, Liz.
  • O'Malley, Desmond J.
  • Owen, Nora.
  • Ring, Michael.
  • Timmins, Godfrey.

CLASS="CP">Níl

  • Bhreathnach, Niamh.
  • Bree, Declan.
  • Brennan, Séamus.
  • Broughan, Tommy.
  • Coughlan, Mary.
  • Cowen, Brian.
  • Davern, Noel.
  • Dempsey, Noel.
  • Doherty, Seán.
  • Ferris, Michael.
  • Fitzgerald, Brian.
  • Fitzgerald, Eithne.
  • Fitzgerald, Liam.
  • Flood, Chris.
  • Foley, Denis.
  • Gallagher, Pat.
  • Haughey, Seán.
  • Higgins, Michael D.
  • Howlin, Brendan.
  • Hughes, Séamus.
  • Jacob, Joe.
  • Kavanagh, Liam.
  • Kenneally, Brendan.
  • Killeen, Tony.
  • Kirk, Séamus.
  • Kitt, Michael P.
  • Kitt, Tom.
  • Leonard, Jimmy.
  • Martin, Micheál.
  • McCreevy, Charlie.
  • McDaid, James.
  • Moffatt, Tom.
  • Morley, P. J.
  • Moynihan, Donal.
  • Moynihan-Cronin, Breeda.
  • Mulvihill, John.
  • Nolan, M.J.
  • Ó Cuív, Éamon.
  • O'Dea, Willie.
  • O'Hanlon, Rory.
  • O'Rourke, Mary.
  • O'Sullivan, Toddy.
  • Pattison, Séamus.
  • Power, Seán.
  • Ryan, Eoin.
  • Ryan, John.
  • Ryan, Seán.
  • Smith, Brendan.
  • Smith, Michael.
  • Treacy, Noel.
  • Upton, Pat.
  • Walsh, Joe.
CLASS="CP">Tellers: Tá, Deputies E. Kenny and McManus; Níl, Deputies Dempsey and Ferris.
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