Tom Hayes
Question:36 Mr. Hayes asked the Minister for Agriculture and Food his proposals to increase the disease levies; and if he will make a statement on the matter. [25963/02]
Ceisteanna – Questions (Resumed). Priority Questions. - Bovine Disease Levies.
Later today, the Oireachtas Joint Committee on Agriculture and Food will be dealing with the motion requesting Oireachtas approval for draft regulations under the Bovine Diseases (Levies) Acts, 1979 to 1996, the purpose of which is to fix the rates of diseases levies from 1 January 2003 at one cent per gallon of milk delivered for processing and at €5.08 per animal slaughtered or exported live. This is in line with the recently published Estimates provision for my Department indicating a doubling of the bovine diseases levies from 2003.
These levies have to be viewed in the context of a total provision in the 2003 Estimates for animal disease including BSE etc., of €216 million, of which €67 million relates to TB and brucellosis. The increases have also to be viewed against the background of the current overall budgetary situation, the Exchequer costs of the schemes and the fact that a major part of the expenditure relates to compensation, where the cost of reactors has increased under the on-farm valuation system. The higher rates of levies will bring in a total of approximately €20 million in a full year.
Revised arrangements for the TB and brucellosis eradication schemes were introduced with effect from April 1996 following agreement with the farming bodies. Under these arrangements, responsibility for arranging and paying for the first clear herd test each year was devolved to farmers. In recognition of this, the disease levies payable were reduced from £7.30 to £2.50 per animal and from 1.3p to 0.5p per gallon of milk. It was agreed that the levies would contribute some £10 million a year or 50% of compensation costs over the 1996 to 1999 period. For a variety of reasons, the levies contribution fell short of the 50% target. Compensation payments totalled some £120 million over the four years while levy receipts reached only £45 million for the same period.
I thank the Minister for his comprehensive reply. Does he realise farm incomes are down by at least 8.5% this year and that it is particularly harsh to introduce this levy given those circumstances? The Department of Agriculture and Food will collect only €10 million but the levy will have a significant impact on the farming community which is already suffering a drop in income. At individual farm level, a farmer with 40 dairy cows will have to pay €230 more and there are many other farmers in financial difficulty.
Does the Minister intend to impose the levy on people in financial difficulty? In no other sector would extra levies be charged when incomes were falling. Will the Minister waive the levy for those people this year given the circumstances and that the amount of money collected proportionate to the Department's budget is small and will not have a great impact but will have a desperate impact on those affected by the levy?
Disease levies have to be viewed against the overall expenditure on disease eradication. The overall figure is €216 million, of which €67 million goes towards TB and brucellosis and I believe a contribution from farmers themselves is reasonable. Given the tight budgetary situation, I have no option but to implement an increase in levies amounting to €10 million.
This is a difficult year for many reasons including markets and the weather but I did not hear anyone here or elsewhere say anything about last year or the year before when there was an increase in farm incomes. The Teagasc survey, for example, which goes through the accounts of over 100,000 farmers, pointed out that last year – which saw foot and mouth disease affect many sectors of society – farm incomes increased by 27% and by 12% the year before giving a total of 39%. They are back 8% this year but farming, in my experience, has always been cyclical and one has to take a number of years at a time.
I am not callous about this. I have the greatest sympathy for the farming community in this particular year. However, with some of these diseases, for example brucellosis, much is down to farm management and care and attention to a disease that is highly contagious. Farmers, as well as everybody else, need to work together to eradicate these diseases. They are costly and a major contribution is made by the rest of society in trying to eliminate them.
I will not challenge the Minister's figures from previous years because I have my own argument in that regard which is that people are leaving the land and earning income from non-farm sources. The Minister rightly pointed out that brucellosis and other diseases require better farm management but, when he is forcing a levy from people who can already ill afford it, surely he is restricting their ability to manage their farms well. Can the people, identified by Teagasc as having financial difficulties, be exempted from the levy?
It is my intention to implement the levy across the board. If I was a young farmer, I would not be encouraged to go into farming from listening to some farm spokespersons. They constantly talk down their own industry and have said in recent months that farm incomes would be down at least 20% and seem disappointed they are only down 8%. They said the figure needs to be scaled up to 15% to take account of inflation. I have not heard any other profession talking down their profession and their industry. I spoke to the farmers about farm assist yet not all the money set aside for small farmers was drawn down. I cannot understand that.
Family income supplement was only taken up by 37% of people.