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Dáil Éireann debate -
Tuesday, 15 Apr 1997

Vol. 477 No. 5

Private Members' Business. - Farm Incomes: Motion.

I move:

That Dáil Éireann notes the sharp decline in the incomes of farm families resulting from the collapse of commodity prices including cattle, beef and milk prices paid to farmers; calls upon the Government to cease its hitherto unsympathetic approach to our farming industry; further calls on the Government and, in particular, the Minister for Agriculture, Food and Forestry, to pursue at a political level their responsibilities in relation to important agricultural issues, including export refunds and the reopening of lost third country markets; and also calls on the Minister for Agriculture, Food and Forestry to fulfil his promise of 4th February to farmers to secure matching national compensation for revaluations of the green pound.

I wish to share my time with two of my colleagues.

Is that agreed? Agreed.

The relatively straightforward position is that Ireland is a member state of the EU and is heavily dependent on the beef and dairy industries. The special position of the beef industry is recognised in several European Protocols and nine out of ten bullocks raised in Ireland must be exported. Destinations for exports include European countries and third country markets and there must be a balance between the live trade and finished products. To this end, Bord Bia, the Department of Agriculture and the Government exist to support and assist the beef industry. Given its special position, there have always been technical and administrative supports in addition to the necessary political support.

The industry is experiencing a severe crisis at present but, regrettably, political support and sympathy does not exist when it is most needed. The composition of the Government gives a clue to the reason for that position. Listening to the address of the Leader of the Labour Party in Limerick last Saturday night, farming families must have felt they had been airbrushed from history. The Tánaiste did not mention rural Ireland or rural issues never mind the crisis in farming. Apparently, the Labour Party is entirely oblivious to it.

As Minister for Foreign Affairs, the Tánaiste has done nothing to assist our largest industry maintain its vital market share of foreign markets. He is more concerned with perpetuating his grudge match with the beef industry than assisting farm families. The Labour Party has betrayed the mandate given to its rural Deputies. However, the arrogance and indifference of the Labour Party is nothing compared to the outright hostility of Democratic Left. Debates in the House in the last year on matters relating to agriculture, all of which were instigated by Fianna Fáil, have been characterised by a vitriolic abuse of farmers and the farming industry by Democratic Left Deputies. Apparently, farmers are not part of the working class which Democratic Left purports to represent.

Democratic Left Leader, the Minister for Social Welfare, Deputy Proinsias De Rossa, is so inured in his prejudice that he said "the farmers are rolling in it" in response to a question about the difficulties of farm families on a recent edition of the RTE "Farrell" programme. Farmers are the victims of the political bigotry and bias of the left wing parties in the rainbow coalition Government.

The hostile bias of the Labour Party and Democratic Left is aided and abetted by Fine Gael. The Taoiseach and the Minister for Agriculture, Food and Forestry have repeatedly rolled over rather than confront the hostility of their Government colleagues towards farmers. For example, the Taoiseach recently said in relation to rural group water schemes that Fine Gael had no policies. As a result, farmers and rural Ireland must depend on the Labour Party and Democratic Left. Fine Gael is in office but not in power. Rural constituencies cannot look to this Government for a rescue scheme in the current crisis.

The litany of broken promises by the Government and the Minister for Agriculture, Food and Forestry to farmers can only be explained by the political cowardice of Fine Gael. No other sector of society has been so let down or ignored by Government. The collapse in farm prices, the closure of foreign markets, the repeated cuts in export refunds and the failure to deliver on the promise of matching a compensation for green £ revaluations add up to a litany of lost opportunities and broken promises.

The recent editorial on 5 April last in the Farmers' Journal sums up the position. It stated that the collapse in beef prices which followed the previous week's revaluation and cut in export refunds was the clearest signal yet that we have lost our way in our day to day dealings with Brussels and its critical management of the beef market. The editorial continued that, ultimately, the blame for this debacle must end up on the desk of the Minister for Agriculture, Food and Forestry, Deputy Yates. It said it will take more than recycled compensation announcements to quell farmers' anger and sense of betrayal at this time.

This is a sad position for farmers and it must be galling for the farming community to hear further announcements of the same tranches of payments. Non farming people are under the impression that farmers get a lucky bag at the end of each week. Basking in good news is not what is required in this case. The Minister has been adept at that because he was bequeathed a good position by the previous Fianna Fáil Government. The Minister has run from photo opportunity to photo opportunity and neglected the real work which needs to be done in Brussels, Cairo, Tripoli, Tehran and Moscow. This aspect has been omitted from the agenda. The Minister is unable to pull his punch at Cabinet and in Brussels. Regrettably, farmers, the industry, co-operatives and PLCs are the losers.

Farmers want to know when the Minister will fulfil his promise of matching national compensation for green £ revaluations. On 20 March and 14 April this year, the IFA said in a statement that it would hold the Minister to the specific commitment he gave to livestock farmers to deliver Exchequer funding to match EU money on revaluation compensation made on 4 February in the Davenport Hotel in Dublin. The sooner this Administration realises that farmers and their families are the backbone of this country the better. This has been the case throughout history. If they are removed, the entire structure of rural Ireland falls apart. Unlike most countries in Europe, farmers are central to the stability and future of the economy. They have contributed in a major way to the development of Ireland's agri-business. They have never been slow to reinvest generously in farm buildings, equipment and machinery and upgrading systems. Everybody has benefited as a result.

Approximately 140,000 or 13 per cent of the workforce depend on agriculture. In the next few weeks when members of the Government parties call on them seeking their support they will ask "when we were down on our knees, what did the Government do for us? Did Ministers have their photograph taken or go to Brussels? When did they last go to Cairo or Tehran to seek to have markets for our livestock reopened?"

Farmers and their families maintain a key presence in many industries. Where would the tourism industry be without farm guesthouses which provide good food for tourists who marvel at our beautiful landscape and the good work being done? If farmers trying to eke out a living and pass on their farms to their sons or daughters cannot look to the Government for support in a time of crisis and difficulty, morale is sapped. It is currently at an all time low. No matter what way one looks at the figures, farmers and their families are central to our hopes for prosperity. Under the left wing dominated rainbow coalition Government, however, there is no hope. The agricultural Celtic Tiger which Fianna Fáil fed and nurtured is becoming anorexic and will soon fade away.

Fianna Fáil is conscious of the importance of farmers and their families to the economy. It has always been the party of the farm family and the village and small town entrepreneur. All of the schemes and programmes that matter to farmers, be they education schemes, the operational programme for rural development, the Leader programme and so on, have been put in palce by Fianna Fáil which has its roots in rural Ireland.

Fianna Fáil has catered for the needs of the rural workforce. Two years ago the future of farmers and their families was assured. There was a thriving live exports market, adequate marketing support and on-farm investment schemes to ensure farmers could continue to compete with their competitors in Europe and elsewhere. If the Government does not assist farmers, we will move inexorably towards world prices in the next GATT Round. All on-farm investment schemes have been abolished.

At the end of 1993, under Fianna Fáil, farm incomes were increasing by 18 per cent to 19 per cent per annum. Today, they are dropping rapidly and there is no light at the end of the tunnel. This month farmers hoped that the slaughter premium would be retained at its existing level but there was no give because the Labour Party and Democratic Left members of the Government had no interest in the matter. GATT, the Americans and the Iranians among others were blamed for the loss of high morale in the industry which dropped to a state of depression and, in some cases, destitution but the real reason is that there has been no commitment to supporting an industry in need of assistance. More than all other occupations, farming is cyclical in nature. We owe it to the farming community to support the industry in times of crisis.

Fianna Fáil negotiated the reform of the Common Agricultural Policy which provided for the most far-reaching initiatives for farmers. These included the ten month and 22 month beef premiums under which cattle farmers obtained an extra £240 per head. Fianna Fáil negotiated the extensification and deseasonalisation premiums as well as the ewe premium for sheep farmers. While this has not been dismantled, it has been torn apart and reduced by £6.50 this year. Hill farmers need it more than most.

Farmers, big and small, benefited from the unprecedented £700 million package negotiated by Fianna Fáil under the accompanying measures. It included the farm retirement and REP schemes. To develop a modern food industry, Fianna Fáil negotiated the operational programme for the food industry worth £641 million. To protect the future of cereal growers, it negotiated the area aid scheme.

On leaving the Department at the end of 1994, I was confident that the industry would be able to withstand a downturn which is inevitable with a left wing dominated Government. Unfortunately I was wrong. Because of mismanagement, for which only the rainbow coalition Government can be held accountable, what happened was beyond the estimation of the worst case scenario.

It is no coincidence that the farm prices crisis coincided with the term of office of the left wing dominated rainbow coalition Government. Farm incomes are under serious threat. Many farmers will leave the countryside. It is estimated that 3 per cent have left. Beef farmers, beef finishers especially, have been let down badly. There is no hope and the opportunity was not taken to ensure the generous package negotiated in Brussels filtered through to them.

The single most important thing the Minister can do is to seek to have live export markets reopened. This requires a political initiative. There is a need to put in place an assurance and certification programme to ensure there are no traces of residues in the cattle we export. Consumers should be confident that our beef is safe to eat. We know there is a minuscule difficulty in relation to BSE, the number of cases is in single figures. Approximately 99.9 per cent of the cattle population is disease free. Why, therefore, has a certification programme not been put in place? Why has the famous assurance scheme, about which we heard so much, not been put in place? There is no point in the Minister flailing around wildly like a failed manager and blaming anyone who comes to mind. A live trade will bring its own competition and bring the factories to heel quickly. Farmers know that even the most rapid computer system in the world will not return prices at marts to their previous levels in the same way as the reopening of the live trade market.

I estimate that approximately 40,000 of the 100,000 beef farmers — I again mention this figure as it will be very important in the coming weeks — have no future, while the remainder will have their incomes severely dented. If the Minister does nothing else in the coming weeks he should visit the capital cities of those third countries and reopen markets for our live cattle trade.

Other sectors of farming are also suffering. Incomes in the dairy industry, which is the prize sector of the agriculture industry, are down by 25 per cent, while milk has fallen to less than £1 per gallon. These figures are going in the wrong direction. Grain farmers are also suffering and are not looking to a bountiful harvest this year. Morale is so low that many parents find it difficult to get their children to take over their farms from them. If this was not bad enough, there is also a question mark over the payment of installation aid to young farmers and it is possible that this will be diluted.

Whose fault is that?

Did I hear a squeak?

Farm organisations know that they have to look to the Government to look after those schemes.

Who negotiated the programme?

It has been stated many times in relation to cattle prices and the EU market that there was no BSE or animal disease problem but there was a ferry transport problem. That problem was made worse by the Minister who went as far as introducing a weight limitation on the top deck. However, he abandoned that lunatic measure two days later. Why would the Minister for Agriculture, Food and Forestry try to make matters more difficult during an acute crisis? I would like someone to explain the reasons.

As farmers know, the Minister repeatedly talked down cattle prices last autumn and frightened farmers into selling cattle at a loss a month after the statement in the House of Commons on 20 March which caused ripples throughout Europe and the world. That statement catapulted the Minister into making a statement that a £20 million campaign to promote Irish beef would be needed in the months ahead because the BSE crisis had caused so much difficulty for our marketers. During the main evening news on RTÉ on 19 April 1996 the Minister told the nation: "We are talking about looking to the Luxembourg Council for an EU fund, perhaps spending up to £20 million in the most intensive promotion ever for Irish beef." Where lies that most intensive promotion ever for Irish beef? It has not yet seen the light of day and farmers are still waiting for it.

The most serious problems facing the agriculture industry are being put on the long finger. Partnership 2000 contains some nice sentiments but these are merely aspirational and only give recognition to the importance of agriculture and the food industry to the national economy. It states that the Government will seek to ensure that any reductions in agricultural prices are compensated for through direct income support payments. Where are those compensatory payments? What use is Partnership 2000 to the farming community? Partnership 2000 also states that the Minister proposes to set up a food safety board. Apart from throwing it at the industry, this board does not have a legislative base, a structure or staff. In other words, it has damn all and is like an aeroplane without an engine — it makes a hell of a splash and is a disaster. Partnership 2000 makes 63 promises to the agriculture, food and forestry industries. During the coming weeks we will seek to ensure that those promises are fulfilled and that there is a serious commitment to the industries so that those involved will benefit.

Inadequate food control systems are putting the health of consumers at risk. This is a dereliction of duty, to say the least. We do not have the necessary controls or a food board, while there is an EHO strike and five counties do not have a full-time veterinary officer. We need to put controls in place if we are to give a credible assurance to farmers that their products will be acceptable to consumers at home and abroad, are safe to eat and will make a remunerative price. We need a transparent food tracing system and a cattle tracking system.

There have been further impositions on the farming community in regard to, for example, the disposal of specified risk material. There is a big contrast between the disposal of this material in the northern part of the country and in the south where farmers are billed. During his two years in office the Minister has presided over a catalogue of crises which range over cattle and milk prices, live cattle exports, grain, third country markets, agricultural and horticultural grants, the green pound revaluation, a cut in export refunds etc. On return to Government Fianna Fáil will immediately embark on an action programme which will confront the issues I have highlighted. Our first step will be to embark on a tour of the capital cities of third countries in order to reopen beef and live cattle markets so that farmers, their families and the workforce dependent on a thriving agriculture industry can return to prosperity. I look forward to hearing the Minister's reply to the motion.

It gives me no great pleasure to contribute to this debate on yet another crisis in agriculture. I support the motion tabled by my party's spokesperson on Agriculture, Food and Forestry, Deputy Joe Walsh. The Fianna Fáil Party accords the greatest priority to this debate and to listening to the views of the Minister, his ministerial colleagues and Government backbenchers. Even though we are within days of the calling of a general election and there is a serious crisis in agriculture, it is noticeable that not one member of the Labour Party has thought it worthwhile to come into the House to listen to this debate. I did not expect members of Democratic Left to be present but I thought Deputies who represent rural constituencies would be familiar with what is happening in the industry.

Farming is a tough, uncompromising business. Nobody expects it will be rosy every day. Twenty years ago, when Fine Gael and Labour were in power, calves were selling at 50p and cattle prices went through the floor, but the Government withstood that crisis which was followed in the early 1980s by rampant inflation, raging interest rates and land sales to settle bank debts. A series of other problems arose also as the national debt was driven from £12 billion to £24 billion, again under Fine Gael and Labour. The Government managed to stagger through that crisis also but now, after a brief respite during which more confidence was generated than had been for some time, the change has come in a dramatic way. Deputy Walsh touched on all the sectors that have been hit but I want to confine my remarks primarily to the beef sector.

There are 100,000 farmers involved in the beef sector, and I know the importance of the export live trade to those farmers, but how important will it be in the autumn of each year when farmers buy stores from the marts to fatten and finish in the winter if they cannot export them? It will not make much difference what the Minister tries to do, even on the live export trade, because he will have presided over a crisis involving a huge number of people. Farmers can withstand a certain amount of pressure, historically they have done that. It has been said that one year out of ten farmers can manage a fairly disastrous situation, but they cannot manage two in a row. That is what is happening in this case.

We do not need a cosmetic exercise carried out for the election. The Minister knows he must do some rebalancing, find the funds for the compensatory payments and work on getting the export markets reopened. There is little point in the Minister telling the factories there is a cartel in operation. Many people have been in farming for a long time and they know there will always be a cartel. The Minister will not introduce any law or regulation to change that unless there is competition. Talk about cartels is insignificant. We saw what happened last autumn and what is happening now. If the Minister does not open up those arrangements he can talk for as long as he likes about what might be done in regard to the processors, factories and cartels.

Fianna Fáil wants to emphasise to the Minister, in as strong a way as possible, the seriousness of this problem. We must forget about the myth that is thrown out occasionally by different groups and media commentators about how well farmers are doing. If people were leaving the medical and nursing professions, Bord Telecom or the Civil Service at the rate farmers are leaving farming, there would be an outcry. There is only one place people are leaving at a faster rate in proportional terms, and that is Dáil Éireann. If farmers are as prosperous as everybody says they are, why are so many of them and their wives not staying in the business? It is an idle exercise talking about rural development, county enterprise systems, Leader programmes and grants to watch butterflies if the farming stock and farm enterprises are not viable.

Some of us have been in politics for a long time. I am not necessarily interested in who does what, but we are facing a monumental disaster which needs immediate treatment. On the basis of what is happening here this evening it appears that the Minister is a lonely figure in what the Tánaiste, Deputy Spring, calls a left of centre Government. We are talking about the people who have been left out by the left of centre Government.

The Deputy would like to be in.

I hear Deputy Connaughton was not too complimentary.

At the outset I wish to thank my colleague, Deputy Walsh, for allowing me and Deputy Smith contribute to this debate. I have noticed that debates in this House on agriculture, be it on the beef or dairy sectors or the BSE crisis, have been initiated by the Fianna Fáil Party in Opposition. Tonight's debate is another example of that with our spokesperson on agriculture, Deputy Joe Walsh, bringing this matter to the fore in the Dáil. This is the place where issues of great importance should be discussed and where the views of our constituents should be aired. Unfortunately, it is the Opposition which has used its time to express those particular views. We are happy to do that but it points the finger at the Government and its cavalier attitude to these issues when it does not deem fit to initiate debates on how to tackle the serious problems currently facing agriculture.

It is unfortunate we do not have any Labour or Democratic Left Members in the House to listen to this debate. That is a more eloquent statement than anyone in this Chamber could make.

Where are the Deputy's coalition partners?

A Deputy

Where are the Deputy's partners?

The Deputy's party might not have any partners.

I will not rise to the Minister's bait who, unfortunately, has done nothing but sneer during this debate at comments made on this side of the House.

I have not said a word.

There was no need, the Minister's expression said it all. A number of IFA meetings have been held throughout the country, and an important one was held in my constituency of County Clare last night to discuss the beef crisis. We are in the middle of a major crisis, yet we are told our economy is prospering and there is much talk of the famous "Emerald Tiger". That prosperity is not evident, however, in the agricultural community. As Deputies Walsh and Smith pointed out, the fall in farm incomes in the beef sector could be up to 10 per cent this year, and incomes in the dairy sector have dropped 5 per cent. If that occurred in any other sector there would be an outcry, and rightly so. To date, farmers have been extremely patient but they cannot afford to be as patient as they have been, putting forward their views in an articulated and vociferous way.

There has been no provision for green pound revaluation. We have heard a great deal about what the EU can do on this and we have had promises from the Minister with regard to national Exchequer compensation. Those promises were made on 4 February but he has not delivered on them. We appreciate the importance of immediate political and diplomatic movement with regard to our markets. This takes political guts and courage. I hope, even at this late stage, the Minister for Agriculture, Food and Forestry will be backed by his Government in his efforts to reopen those markets. As to the argument about reopening the cattle markets in north Africa making difficulties for the GATT regime, our spokesperson, Deputy Walsh, has pointed out on a number of occasions that we can take this on quite comfortably within the GATT regime. This should be done, and it should be done immediately.

I move amendment No. 1:

To delete all words after "that" and substitute the following:

Dáil Éireann recognises the income difficulties arising for beef and dairy producers as a result of the reductions in export refunds and the recent revaluations of the Irish agricultural conversion rate and changed circumstances in export markets and approves the action taken by the Government to maintain access for Irish cattle and beef exports to all markets and endorses the approach adopted by the Government in its efforts to alleviate these income difficulties.

Before dealing with some of the substantive and detailed issues in this debate I will make a few initial observations, as I note that a number of farmers are present and, what with water and television deflectors, I have not had the opportunity to speak publicly on these issues. I am glad to have the opportunity to do so now.

What has that to do with farming? That is another deflection.

Much of what Deputy Joe Walsh said was true but, as a Deputy who is a former Minister and Minister of State who spent seven consecutive years in the Department of Agriculture, Food and Forestry, his memory is selective. It was not I who negotiated the GATT quota of 60,000 tonnes a year, about which I will speak at some length and which farmers need to understand. It was not I who negotiated the 15 per cent reduction in the intervention price for beef. It was not I who negotiated the safety net for Irish beef which is now 72p a pound. These were all part of the CAP reforms Deputy Walsh was so willing to boast about in the context of increased premia — the basis of the MacSharry reforms was to move from product support to direct income aid. However, in those good times in 1994-5 when we were not putting beef into intervention, behind the scenes the supports were being systematically dismantled so that when they were needed post-BSE in the implementation of GATT, I was left to deal with a situation where Council regulations have been put in place and can be amended only by Council which, as the Deputy knows, requires a qualified majority of 58 votes. It is fanciful to suggest the Minister for Social Welfare, Deputy De Rossa, the Tánaiste and members of the present Government caused the problems in the beef sector. I am happy to compare the Estimates of the Department of Agriculture, Food and Forestry in 1996-7, the tax concessions on capital acquisitions tax, on capital depreciation and capital allowances, decisions of this Government and supports of one kind or another for the rendering industry and so on with the achievements of any of my predecessors. Any time I have had a problem this Government, and particularly the Taoiseach, has been wholly supportive.

I find it very rich that the Deputy should speak in mellifluous tones about the suspension of schemes. He knows all the Structural Funds from which the FIP, CFP and dairy hygiene schemes are funded were negotiated by him. I have brought forward moneys from 1998 and 1999 into 1996 and 1997, but the truth is that there was a woeful under provision simply because of the shrinking billions subsequent to the Edinburgh summit — we all remember the fourchette cast upon by Deputy Ahern and others in relation to those billions that disappeared. That is the reason there is no CFP scheme today. I assure the House that all relevant schemes have been brought forward so that farmers can be paid at the earliest possible date.

Speaking to farmers as much as to the House, I regret that there is no quick-fix solution as far as the beef sector is concerned, regardless of who is Minister or what Government is in office. One can argue about the cut in export refunds of 17.5 per cent, but it is beyond my control that pre-fixations for beef last week were 20,000 tonnes and today were 30,000 tonnes so that, as we speak, refunds have been suspended again. Despite having spoken on three occasions in recent days to Commissioner Fishcler, he and I are prisoners of GATT; we have to manage something like 25 per cent of the remainder of the GATT year to 1 July with about 15 per cent of the licences to give out. This means if we do not adjust the refunds there will be no refunds to disburse in late May and June. The reason for that is that beef consumption in Europe post-BSE is down by a minimum of 8 per cent. If the beef cannot be sold in Europe it must be sold outside Europe. We sell it outside Europe with a subsidy, and if that subsidy has limits on it in volume and value terms, GATT licences must be shared out. That is what I want to address tonight, because farmers need to understand the root cause of the present difficulties. People will remember that before the BSE crisis we had our first taste of cuts in refunds in December 1995, the first year of GATT. In years to come we will not have access to intervention as we now have, and the GATT quota will be tighter in 1998 than it was in 1997, and tighter in 1999 than it will be in 1998.

These problems will not simply evaporate because Deputies De Rossa and Spring are in or out of Government. That is a facile analysis. The Deputy referred to an editorial in the Irish Farmers' Journal, which I read, which implied that all these problems can be deposited at my door. That is an insult to farmers' intelligence; these problems run far deeper than any allegation that people have lost their way in Brussels. This is part of the wider liberalisation of world agriculture which started seven or eight years ago, is well under way and will not go away for the next 15 years.

I proposed my amendment to the motion because it more accurately reflects the reality of the Government's efforts to deal with the current difficulties facing farmers. There is no argument from me regarding the income difficulties of the beef sector. I fully accept this is the most expensive time of year to produce beef and that the prevailing price of 80-82 pence per pound is not viable. There is no argument form me on the severity of the difficulties. However, the revaluation of the Irish green pound of 8 per cent to 8.5 per cent cumulatively again has not been directly in the Government's control because sterling has been revalued and we have been dragged upwards. When I became Minister the problem was that the Irish pound was £1.04 against sterling. Many Border Deputies cry salt tears now that the Irish pound is at 95p, and there is not a word about our competitiveness on Northern Ireland and British markets which has been a plus of the currency situation. The revaluation has been much stronger and yet beef prices have not dropped as much in the United Kingdom as they have here, and this is the question I have put to the meat factories.

There has been a stream of intensive activity. Everybody knows since the House of Commons' activity on 20 March that my Department has been on red alert working continuously through the night and through the weekend to do everything in our power to assist farmers in every way. I will list some of the solid achievements over that period. We need no advice on the importance of the potential of the agriculture industry. The link between BSE in cattle and CJD in humans precipitated an unprecedented drop in beef consumption throughout Europe. As a result of the increased resources which I allocated to An Bord Bia, beef consumption is highest in Ireland. The promotional campaign by An Bord Bia, involving in the order of £1 million, has worked. There has been a more intensive focus on beef than ever before in the history of the State.

Notwithstanding the difficulties, Irish beef exports to international markets in 1996 increased by 40 per cent over the previous year. That is in sharp contrast to the position when our friends on the other side of the House were in power, when nine out of every ten bullocks went into intervention. We are all aware of the associated problems of malpractice that existed at that time, when markets in third countries closed not for three weeks or three months but for three years in many cases. Before the BSE crisis there was an annual drop in beef consumption in the European Union of 1.5 per cent per year, with a drop of almost 10 per cent in the previous decade.

In 1993 Europe exported 1.3 million tonnes of beef and that figure will be reduced to 800,000 tonnes, with no export subsidy payable for half a million tonnes, the exact amount we export, at the lowest price in the European Union. That it is the nub of the present problem. Taking into account the drop in consumption, which varies between 8 per cent and 12 per cent throughout the European Union, one can understand the pressures that exist because of the GATT limitation, and those difficulties will remain for some time.

While Fianna Fáil has been very vocal about what I should do in regard to compensation, I have not heard that party say that Fianna Fáil in office will pay the matching compensation.

They never did.

I have heard much from Deputy Ahern to the effect that Fianna Fáil will reduce the absolute level of debt and cut public expenditure, but I have yet to hear anybody in that party say that they will match the money.

Deputy O'Malley said they would do so.

Did the Minister meet the IFA and ICMSA?

In recent times I put to the Commission a counter strategy to manage the GATT quota. I suggested that, as with the intervention tenders, a co-efficient reduction would be applied rather than cut the value of refunds. It must be borne in mind that, on two occasions, I succeeded in persuading the Commission not to reduce export refunds only to find the following week that 30,000 tonnes or 40,000 tonnes were prefixed within a matter of hours and the Commission had no choice but to cut refunds — the one million tonnes are divided into a weekly quota of about 20,000 tonnes and that figure cannot be overstepped.

I put further proposals to Commissioner Fischler on refunds, for example, relating to the sex of the animal — we are particularly dependent on steers — and suggested that refunds be applied in a way that would not affect markets such as Russia and Egypt on which we are particularly dependent. There is a disproportionate effect on the prevailing price here because three-quarters of our steers go to such third countries. I do not agree with the Commission's view that it has adopted the best strategy to maintain prices and, with my colleagues, I will continue to press this issue.

During our Presidency, the first steps were taken to deal with this matter. Deputy Joe Walsh asked where is the light at the end of the tunnel. I took more personal abuse on this matter than anybody else in the European Union because I said that the only way we could restore balance between production and the drop in consumption was to slaughter calves. I was vilified when I said that the Commission's proposals did not go far enough. In October I persevered in Luxembourg to get that measure through, and that is the light at the end of the tunnel. Under the calf slaughter premium and the early marketing premium, we are effectively cutting beef production by 350,000 tonnes. Meat factories strongly opposed this measure because they knew it would prevent cattle and beef prices from plummeting in Europe. I single-handedly pursued this issue despite having no support for it.

We have slaughtered about 13,000 calves while the UK and France have slaughtered 540,000 and 180,000 calves respectively, bearing in mind that France only started that scheme in October. That will restore balance to the market. There is hope as we approach 1998 in that there is a reasonable prospect that we will slaughter one million calves, the number in excess of requirements. It can be expected that beef production will fall by almost 600,000 tonnes per annum and that will be the first step in rebalancing the market as well as meeting GATT requirements.

Were it not for my efforts and the concession I received from Commissioner Fischler, the weight limit of 360 kgs for intervention would be much lower and the O4 category would not be eligible for intervention. In addition, DSP would not be payable. Some people have suggested adjusting the DSP, but that would require an amendment to the Council regulation. I succeeded in reducing the DSP eligibility trigger from 40 per cent to 35 per cent of seasonal slaughterings, North and South. Were it not for my negotiations, there would be no DSP for winter fatteners and no higher extensification premium for 66,000 farmers who are seeking an extra £15 million this year.

Reference has been made to recycled announcements, but if I do not produce the money I am criticised for doing nothing and if I produce the money I am accused of recycling old announcements. Some £122 million of European funds will be brought forward and the first payments to beef farmers will be made from 12 May this year. I hope that, within four to five weeks, the vast majority of people will receive top-up payments on their suckler cow and beef premiums.

On 4 February in the Davenport Hotel — I always tell farmers the position as it is, whether the news is good or bad — I said that I was very anxious to pursue, particularly for beef farmers, the question of matching national compensation. At no stage did I say that the Government had agreed to it. I was at pains to say that no provision has been made in the Estimates for that matter because, at the time of the budget, there was no revaluation. I wish to put it on the record again that the Government has not agreed to provide matching funds. I am, however, involved, as are my colleagues — I received wonderful support from the Fine Gael Parliamentary Party and from our Labour colleagues on this issue——

What about Democratic Left?

These are the people who are in touch with farmers and are aware of their needs. I am even more hopeful than I was on 4 February that there is a reasonable prospect of these representations bearing fruit. I have to assess the position. What would have happened if I had rushed to pay out compensation on 5 February and the big drop in cattle prices took effect on 1 April? I want to target those in greatest need and I am listening to my colleagues to find out who has been most affected by the drop in prices.

I hear threats were made at the parliamentary party meeting.

I have the full support of my parliamentary party.

I would not bet on that.

I am confident it will be an expanded parliamentary party after the forthcoming election. The Deputy is very nervous about the forthcoming election, but I am looking forward to it.

I am not as nervous as the Minister of State, Deputy Doyle, or Senator D'Arcy, whom the Minister forgot to mention.

They did not have a candidate added to their tickets. Last year we secured £100 million in compensation in addition to the DSP and the extensification premium. We have secured an additional £26 million arising from the revaluation on 28 March. There have been eight previous revaluations. I am the first Minister of any member state to pay out the money within three months of the revaluation. The Government has not concluded its deliberations on the question of matching money. While Fianna Fáil tends to blow hot and cold in this area and place demands on me, farmers can rest assured the Government is monitoring the position carefully and will do everything possible to provide the appropriate resources.

Farmers are getting very impatient.

Deputies should not be impatient, the timing will have good effect. I will keep the House informed on matters.

It has been suggested that all the problems would be resolved if I rolled out the Government jet and travelled to Tripoli, Cairo and Moscow.

The Minister should make sure to have his picture taken before leaving.

I have been to Tripoli, to Russia and to a number of other states within the Union and have attended all the major beef promotions carried out by An Bord Bia. Notwithstanding the constraints imposed on us by the Presidency of the European Union, we had a higher ministerial input than any other member state at those promotions. Irrespective of whether there is an election, I will be in Cairo between 6 and 9 May. For the first time the Irish Government will be represented at the International Food and Trade Fair in Cairo and I will be in regular touch with Dr. Wally. Beneath the surface we ran into serious difficulties with the export certification of beef to Egypt in that it precluded cuts of beef close to the spinal cord from entering its market. Intensive diplomatic and technical discussions concluded only in the last fortnight and in the first half of this year we will ship more beef to Egypt than ever before.

We all believe the Minister.

We will ship more beef to Egypt than to Russia during that period. That is an indication of our success in that market. However, I agree with Deputy Walsh that live exports are essential and the spring of 1997 is proof of the need for competition between live exports and the meat trade. On the best advice available to me, there is no question of the live trade being reopened before May. I accept the advice of our Ambassador in Cairo, An Bord Bia and my officials who have had the experience of dealing with a three year ban from the Egyptian market on another occasion. Despite all the flak I took last October in regard to the Russian deal, we would not be selling beef to that market today if we did not sign the Protocol with our opposite number there. We maintained the orderly disposal of beef. Unlike Fianna Fáil, we did not throw a quarter of a million tonnes of beef into intervention. Massive stockpiles in intervention solve only current problems. Those stockpiles have to be released on the market at some time in the future and the Egyptians or the Iranians could decide to buy cheap intervention beef rather than Irish beef. That is why I put such an effort into maintaining these markets. I have always been aware of the long-term implications of putting beef into intervention.

Egypt and Libya are the only countries that have accepted large numbers of live animals. I visited Tripoli last year and, following a visit here, a technical delegation — which was impressed by our controls — is in the process of making recommendations. I am following this up by making representations to my opposite number in Libya. I was the first European Cabinet Minister to visit Libya since the Lockerbie air crash and I informed them of the priority the Irish Government attaches to beef. I hope they will soon start to accept our beef and we can then consider the question of live exports.

A technical delegation will shortly pay another visit to Iran. I could have signed a deal with the Iranians but it would have involved even more extension of regionalisation. My friends opposite are the biggest critics of regionalisation. They cannot have it every way. They must either agree with regionalisation and signing Protocols or disagree with being excluded from Iran. I am pleased to confirm the reopening of the United Arab Emirates market which may encourage other Gulf states to drop restrictions on Irish beef.

I appreciate that 1996 was a difficult year for the dairy sector and there were delays in passing on price reductions in 1997. Dairy incomes reached a high point in 1995-6. I recently made a decision in regard to temporary leasing and restructuring in this area. I am focusing on the future of the quota regime and await the Commission's proposals in that regard.

I welcome this debate. It is an insult to the intelligence of farmers to talk nonsense about centre left Governments and attack Fine Gael's partners——

The Tánaiste referred to the centre right.

——in an attempt to portary the current difficulties as the responsibility of this Government. Deputy Walsh gave the game away this evening when he said he knew agriculture was about to experience a downturn when he left the Department of Agriculture, Food and Forestry in December 1994.

The Minister should own up to his responsibilities.

The Deputy had to negotiate GATT and CAP reform of which Irish farmers are now victims.

The Minister is not in Kavanagh's bar now, he is in Dáil Éireann.

Farmers will appreciate that, irrespective of the difficulties with which this Government is confronted, it will serve their needs.

Deputy Walsh got out when the going was good.

The Minister's two fans behind him applauded very unenthusiastically.

It is a long time since anyone clapped after a speech delivered by Deputy Byrne.

I am disappointed that members of two parties of this great partnership have not come into the House to support the Minister tonight.

The Deputy's party partners are missing tonight. Their seats are vacant. They seem to have water problems.

Deputy Harney must be looking into a water meter.

The Minister, Deputy Yates, came to office in the best possible year. I am surprised Deputy Connaughton is here tonight trying to lead a group that is supporting the Minister because I understand he condemned the Minister in his constituency and before the Fine Gael Parliamentary Party. He cannot have it both ways. He cannot play to his constituents and come in here and play a different game.

The Deputy has a fertile imagination.

The Minister came to office in a great year. We had great weather and good prices. The Minister lapped it up. I recall farmers got £1.07 per lb for beef, but today they get between 78p and 80p per lb for beef.

Thanks to the MacSharry deal.

At that time farmers got £1.20 per gallon for milk and today they get 98p. That drop in prices illustrates the problems facing farmers. That is why they are visiting every rural Deputy's clinic asking for support to address the current fall in prices, a problem they have not faced for many years.

What is the Deputy's party offering them?

Farmers are facing a loss of £200 per head in cattle prices and the average dairy farmer is facing a loss of £57 per week in milk prices. That is the background against which we tabled this motion. I am sure there are decent and honest Fine Gael backbenchers who support this motion. The motion reads "That Dáil Éireann notes the sharp decline in the incomes of farm families resulting from the collapse of commodity prices including cattle, beef and milk prices paid to farmers; calls upon the Government to cease its hitherto unsympathetic approach to our farming industry....". I am sure all the Members present agree with the sentiments in that motion.

The Deputy's party began its official record by skinning calves.

The Minister will not be judged on the problems that have arisen but on how he reacted to them. Everyone here and in Europe would agree that he has had the finest ever political PR machine. I recall Joe Kennedy once said to his son, J.F. Kennedy, when he was a little reluctant that "it's not what you are, son, it is what the people think you are". That strategy worked for the Minister for a long time. He was riding high, handing out cheques and announcing new schemes. Does he remember the farmer's charter? It was forgotten before the photograph was developed. The Minister was the greatest, but when his first test came in the shape of export refunds, he collapsed. Then we had the BSE problem. He was so slow to react that Irish beef was equated with British beef.

The previous Fianna Fáil Minister for Agriculture failed to react when the first Irish case of BSE was announced.

We lost valuable ground which we have not made up and we have been paying for that mistake since. The chain came off the PR machine and the real Minister was exposed. Last week when I raised the issue of the collapse in beef prices in this House, I looked across the Chamber and in the front row I saw the Tánaiste, Deputy Spring, and Ministers, Deputies Higgins, Taylor, De Rossa, Howlin and Bhreathnach and the Minister of State, Deputy Rabbitte.

And Deputy Harney.

I thought, God help the farmers. They did not have one friend on the opposite side, but many an enemy. I have some sympathy with the Minister trying to get matching funding for agriculture from the Government.

How much would they get from Deputy McDowell?

The Minister, Deputy Yates, the Taoiseach and our friends on the Government back-benches have the gall to go around the country asking farmers to support the return of parties to this House that will not even come into this House to support our biggest industry.

The Deputy is only sorry they are not backing his party.

Is the Minister joking?

The Deputy's colleague failed to act when the first case of BSE was announced.

An Leas-Cheann Comhairle

Let us not have any more interruptions.

If only those parties were backing the Deputy's party.

I hear the Minister is saving up in the Department of Agriculture, Food and Forestry for an election bonanza and that farmers will get a big windfall, but they know they are entitled to it.

No thanks to Fianna Fáil.

The Minister has failed to get anything through Cabinet, but the Minister for Social Welfare, Deputy De Rossa, has no problem getting measures through when his Department is at risk. If farmers were asked what is the main difficulty facing the industry, they would say the closure of markets in Egypt, Libya, Russia and Iran. They should be reopened. The Deputies opposite have heard farmers call for that many times. When the Russians came here the Minister, Deputy Yates, considered that his clinic work was more important than our trade with Russia. Let us call a spade a spade.

The President of Russia refused to come down the steps of a plane to meet a former Fianna Fáil Taoiseach. What does that say about the relations the Deputy's party has with the former Soviet Union?

An Leas-Chean Comhairle

This is an important debate and let us treat it as such. Deputy Sheehan, let us not bring frivolity into it.

The facts speak for themselves.

The Deputy should speak to the Minister, Deputy De Rossa.

This debate is so important that five of my colleagues wish to share time with me and I hope that will be agreed.

The Deputy is running out of steam.

An Leas-Cheann Comhairle

Let us not erode the precious time left.

Last Saturday, the Tánaiste, Deputy Spring, spoke about the misery years. The people present in the public gallery and our farmers know that 1996 and 1997 have been the real misery years.

The farmers know they are safe in the hands of this Government.

That is why the Minister has been dubbed the Minister for misery. I am sure the Tánaiste's great friends opposite were listening to his speech last weekend but he did not mention agriculture.

He said he would rather go into Opposition than join the Deputy's party in Government.

The Minister circulated a document to his constituents, which I received, but in it he forgot to mention the Minister of State, Deputy Doyle, and Senator D'Arcy.

Another document will be issued.

More recycled stuff.

The Minister also forgot to mention agriculture in that document. Who paid for that document? What stipend is being given for all the documents that are being issued? The IFA, the ICMSA, the ICA, Macra na Feirme and others support us on this. We, on this side of the House, would like to see these problems resolved. If the Minister takes any measures to resolve them, we will support them. We will support Fine Gael because we know in its members' hearts there is a little support for agriculture.

A former Fianna Fáil Minister allowed BSE to run rampant through the national herd.

Before this debate is through the snipers from DL will come in to condemn.

The Deputy is the Michael Bell of Fianna Fáil.

I ask the Minister to take some action even at this late stage and we will give him all the support such action deserves.

I am delighted the Deputy will row in behind the Minister.

I support the motion ably proposed by Deputy Walsh, but sadly it appears from what the Minister said tonight he does not know farmers are facing a crisis. If the Minister does not take some action, the effects of the crisis will be more acute next autumn.

The Deputy's party created it.

There is complete indifference in Government to the farming crisis. The Tánaiste spoke for an hour at the Labour Party Ard Fheis and he never mentioned the word "agriculture" in his address. We then heard the attacks on farmers by the Minister, Deputy De Rossa. He said: "the farmers are rolling in it". He also said that farmers were leading the revolt concerning water charges because they wanted free water for their farms. The Minister and his colleagues behind him know that those remarks are untrue, but that is how agriculture is being portrayed by the two centre left parties in Government with Fine Gael.

I hope the Minister will take us seriously and will take action. I am delighted he is to visit Egypt.

He was the first Minister to go to Libya since the Lockerbie disaster.

I am surprised he is going to Egypt at this late stage because initially he attended public meetings where he told farmers they would get outrageously high prices for their cattle. I attended a meeting in Athenry which was also attended by Deputy Connaughton. The Minister did not give them the facts——

Everything I told them was proved correct.

——and this has been borne out. The current price per pound of cattle is not what the Minister said it would be when he attended these meetings. Farmers are glad he is going out of the country rather than around the country and I hope he will be able to open up export markets.

Two weeks ago the Irish Farmers' Journal referred to the country's unique position in regard to live exports and stated farming was turning into a lottery. I want the Minister to recognise the uniqueness of the live cattle policy and I hope his colleagues support that policy. It is better to sell beef to other countries rather than have it stored in intervention. What has been done? For the first quarter of this year, 12,741 live cattle were exported, 76 per cent down on last year. That is a huge drop. The Egyptian, Libyan and Iranian markets are closed and the Russian market is confined to 40 per cent of Irish beef exports.

Through no fault of this Government.

I welcome the Minister's attempt to address this issue and I hope he does so quickly. Apart from one stopover in Russia on a journey elsewhere, the Tánaiste has not visited these countries nor has he made the necessary diplomatic efforts through his Department. A visit from the Taoiseach might be needed to reopen the live trade to these markets.

Do not send Deputy De Rossa.

BSE is not a difficulty in our live trade but that has not been emphasised enough. It is the best promotion and marketing factor available.

When will the Minister provide the matching compensation he promised in the Davenport Hotel? I was at that meeting and farmers heard him make that promise. Promises are made in Partnership 2000 concerning compensation, control of farmyard pollution grants and REPS. There has been no indication about what will happen in regard to them.

Deputy Walsh referred to the establishment of an independent food safety authority to rebuild consumer confidence. It is very important for the beef sector and I hope there will be a commitment to reopen vital export markets in the UK, Europe and the Middle East.

I am glad to have the opportunity to contribute to the debate. The agriculture industry is going through its most difficult period for many years on a number of fronts. There is serious difficulty in the beef industry. Having attended meetings in my constituency and spoken to individual farmers, there is no doubt that those who have committed money to this capital intensive sector face bankruptcy. They are without hope and are asking what will the Minister for Agriculture, Food and Forestry do for them. Promises have been made that a package will be put together before the election but that is not good enough.

The difficulties in the industry must be approached in a planned and co-ordinated manner. They have their roots in the BSE problem and the curtailment of the live export markets with a consequent build up of stock which has led to problems selling meat and the difficulties that exist with the operation of the GATT quota arrangement.

Farming is the largest industry in our economy. Is it within the negotiating capacity of a Minister for Agriculture, Food and Forestry to go to the EU and tell it that Ireland is more dependent on output from the agriculture industry than any other country in the Union and plead a special case even on a short-term basis? There must be flexibility in the operation of the export refund arrangement within the context of the controls of the GATT quota arrangement to take account of the build up in the system. Is it possible, for instance, that some live export markets will reopen in July or August? Is it realistic to suggest that we should take beef out of the system between the middle of April and July and then approach the EU to examine the export refund and GATT quota arrangements and look at the detrimental impact they are having on farmers?

Who is responsible for GATT?

It is the Benny Hill of Fine Gael.

The problem has been compounded by the green pound revaluation. The agricultural press has reported that the Minister has informed the Minister for Finance that money needs to be put up here to trigger the money for the compensation package from the EU. Is the farming industry a victim of the traditional antipathy and prejudice of the Labour Party towards it?

That is the bottom line.

Is the Minister in a position to deliver the compensation package so sorely needed for the industry?

What is Deputy De Rossa saying?

Farming community representatives are in the public gallery. I am sure they will watch "Oireachtas Report" tonight to see if there is a ray of hope in this debate.

I am focusing on two issues which are not being addressed — the export refund and GATT quota arrangements. There must be flexibility to take the surplus beef out of the system. Is negotiation a possibility? Is it possible to approach other member states to take account of the perilous position of the industry here?

While the beef sector has been the principal focus of debate, the potato industry is another area in which there is no common organisation of the market. Potatoes and beef are the two principal forms of agricultural production in the Taoiseach's constituency, yet neither is getting the priority it deserves at Cabinet level. Why? Where does the influence lie within the Cabinet on these issues? People involved in beef and potato production will be bankrupt before the end of the year. There are dire predictions for the beef, milk and cereal sectors. There is a mass exodus of people from the industry and there is a long-term threat to the rural economy. Rural Ireland will be denuded of resources and people in the long term.

Thanks to GATT.

Deputy De Rossa was not looking after farmers' interests when he was in Moscow. Whose interest was he looking after when the Deputy thought he was there for only one day?

A vote for Fine Gael is a vote for Deputy De Rossa.

No good ideas.

The Minister is running away from farmers.

Debate adjourned.
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