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Dáil Éireann debate -
Thursday, 12 Nov 1998

Vol. 496 No. 5

Ceisteanna — Questions. Priority Questions. - Income Support.

Willie Penrose

Question:

2 Mr. Penrose asked the Minister for Agriculture and Food if he will devise an alternative system for allocating income support for dry stock farmers in order to ensure their survival as farm families in view of the fact that the system of income support has seriously failed this sector; and if he will make a statement on the matter. [23336/98]

Proposals for revision of the income support system for the beef sector in general are contained in the Commission's Agenda 2000 proposals. Negotiations are continuing in the Council of Agriculture Ministers on the proposals which, as they currently stand, I do not regard as being sufficiently favourable to the type of production carried out in this country. The particular situation of dry stock farmers will be taken into account in any agreement by Ireland to the final outcome.

As regards the short term, the current market weakness in the beef sector, which primarily results from the collapse of the Russian market, has put downward pressure on prices paid to producers throughout the Irish cattle and beef sector. However, the improvement in the intervention arrangements which I negotiated in October, along with the 21 per cent increase in export refunds, has had the effect of arresting the decline in prices and bringing about a definite upward movement which should continue over the coming weeks. It is also the case that the current system of support enables a considerable level of direct payments to be made to beef producers.

I have established a task force on beef to examine the future of the sector as a whole from primary production to the marketing of the final product. I will be asking this group to draw up an action plan aimed at putting the sector as a whole on a firm and long-term footing so that it can confidently and vigorously face the challenges ahead.

I thank the Minister for his reply but I think he is missing the point. Does the Minister accept that a system which results in 80 per cent of the available supports, of the order of approximately £1 billion, ending up with approximately 20 per cent of producers is fair or equitable? Is a system which excludes beef heifer producers, a very important sector of the industry, fair or equitable? Is the level of suckler cow premium fair? We seem to forget that the suckler cow is the genesis of the beef industry in Ireland. Has the Minister seen the survey produced by the Roscommon Smallholder Action Group on rural living 1991-6 and have its contents been studied by him or his Department? Is a system where two thirds of the 100,000 dry stock farmers are earning less than £5,500 per year acceptable? Some of those farmers are on the poverty line and are asking how they should approach voluntary organisations to seek assistance. Is the current system a failure and has the Department studied how serious the problem is because it has failed to allocate, distribute and target support prices to those who need it most?

While substantial direct payments are made to farmers, a number of studies have shown that a considerable amount of that money — approximately 80 per cent — went to the top 20 per cent of producers in the early stages. That figure has levelled with approximately 70 per cent of payments now going to the top 30 per cent of producers. There is an imbalance there. In the context of the Agenda 2000 negotiations, I am examining the current payments system.

There will be an opportunity to have a more equitable distribution of those payments as the proposals allow for direct payments from Brussels and a national envelope which will allow member states facilitate small and medium sized farmers who are not getting a fair crack of the whip. Irrespective of prices, farmers who are too small still find themselves in difficulty. In addition, there is the anomaly of farmers not receiving payment for heifers, a matter which is being actively examined.

The Department has models of payments and how they are distributed and in the context of the negotiations will seek to have a more equitable distribution so that we can establish the industry on a sounder footing for the future.

Has the Minister seen the two proposals put forward in the survey carried out by the Roscommon Smallholders Action Group which would significantly increase the income of smallholders, particularly in the dry stock sector? The survey suggested a tiered area based system and a tiered direct payment system. Has the Department given any consideration to either of these or will the survey form part of the discussion when the Agenda 2000 proposals are being formulated? I agree with the Minister that national envelope payments should be targeted at low income farmers.

I do not wish to give a short answer to the Deputy's question. My understanding is that a later question deals specifically with the Roscommon survey. I can confirm that I received a copy of the survey and will include it in the support documentation and advice to me in the context of the Agenda 2000 proposals.

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