Vol. 561 No. 3
1 Mr. Timmins asked the Minister for Agriculture and Food the details of the offer made to the farm organisations on 1 February 2003 as part of the partnership talks, referred to in his Private Members speech of 4 February 2003 in Dáil Éireann. [4146/03]
The mechanics of putting in place a new social partnership agreement has been in progress for a number of months and the process is still not fully concluded. The farming pillar came to the negotiating table with a range of different requests, as did the other pillars. The sum of all the demands would have major cost implications for the Exchequer and would result in large-scale borrowings. I know that the farm organisations would agree, as would the rest of Irish society, that there should be no return to excessive borrowing and that a return to the borrowing levels of two decades ago would constrict economic growth and job creation and would lead to higher inflation and higher interest rates, which would not be in the best interests of the agriculture sector.
Against this background the proposals made to the farming pillar on 31 January and again on 1 February are, within the context of the current partnership process, the overall resources available and the budgetary situation, significant. To indicate the comprehensive approach taken in relation to agriculture there are solid commitments on the CAP mid-term review, the WTO, the dairy sector, the beef sector and the food industry and improvements in the REPS, the farm waste management scheme, commonage framework plans, SACs, disadvantaged areas, stamp duty for young farmers, stock relief and land annuities.
There have been suggestions that significant EU funding could be lost to this country in the area of Brussels-funded schemes. It is true that REPS expenditure is behind schedule but this reflects low demand – my Department has turned no one away. There is time to rectify this situation and I would point to this country's track record in drawing down such funding, which is the envy of many other member states. I am firmly of the view that all available EU funding can be drawn down to the overall benefit of the farming community.
There have been suggestions from some quarters that we will leave some moneys "on the table" in Brussels due to lower than expected participation by farmers in REPS and the early retirement scheme. There is no truth whatever in that suggestion. We have to date fully drawn down our annual funding ceilings under the CAP rural development plan, which covers the REPS, early retirement, compensatory allowances and forestry. Furthermore, I am absolutely confident that we will continue to draw down our full allocation over the remaining years of the plan.
Additional informationThe total draw-down of EU funds for REPS, early retirement and compensatory allowances up to the end of January 2003 was just under €900 million. A further €1.1 billion will be drawn down over the remaining years of the plan, which runs to the end of 2006.
The House will be aware that I have instigated a major review of the REPS and this review, with the scheduled mid-term evaluation of the overall rural development plan, will further facilitate the effective implementation of the measures in the plan and the draw-down of EU funds.
I would also point to the concessions in the budget and Finance Bill with regard to stamp duty and stock relief for farmers. Not only will young trained farmers benefit from this concession – these two measures alone will benefit farming to the tune of €16 million per annum.
Regarding disease levies, no consumer of services likes to have to pay more. However, this increase in levies must be placed in the context of a steep rise in the cost of disease eradication measures in recent years. For 2003 the Estimates for my Department include provision of €216 million for measures relating to TB, brucellosis, BSE, fallen animals, rendering, scrapie and other diseases. A significant element of these costs relates to compensation payments to farmers which in 2002 totalled €90 million. To alleviate the problem an offer has been made, within the partnership process, to the farm organisations to partake in a series of value for money reviews of expenditure. These reviews would take place this year to identify savings for the Exchequer and farmers, while protecting consumer health, animal health and animal welfare and complying with statutory requirements. Much progress can be made using this approach.
As regards levies, under the 1996 agreement with farm bodies, it was agreed that these would be fixed at levels which would yield £10 million a year or 50% of compensation costs, whichever was the higher for the following three years. For the period 1996 to 2002, levy contributions accounted for 25% of compensation paid.
I know that there are difficult choices for farming organisations and there are some aspects of the agreement that may not suit them. Similar choices are faced by all the pillars, who in a difficult budgetary climate may have to accept that the resources that were previously available to them will have to be restricted. However, the partnership process, which has served the economy so well in recent years, provides us with the best mechanism to ride out the present externally unfavourable economic circumstances and restore Irish economic growth to its previously high levels.
The achievement of the general overall measures within the new programme and within current resources is just as important as any sectoral measures. Of equal significance is that measures that have been taken in this programme will, among other things, protect the general well-being of the economy which is, of course, of primary importance to farmers as it is to other sectors and will result in higher economic growth, lower interest rates and lower inflation at a later stage.
In addition, the farming community has a special interest in many if not all of the ten special initiatives being undertaken during the period of the programme. These include the cost and availability of insurance, tackling educational disadvantage, ending child poverty, care for people with disabilities and older people, and waste management among other things. The successful implementation of these initiatives will make a major contribution to our quality of life. All major stakeholders in society must contribute to this process and it is for this reason that partnership involving all four pillars is so vitally important.
It is no secret that the current round of partnership talks have been difficult but we have had many difficulties since the instigation of the whole partnership process in 1987. However, it should be remembered that partnership has served farmers well. I applaud their contribution to the partnership process over the years and their input into the series of previous agreements. I, like all my other colleagues in the Government, would like that input to continue.
Will the Minister agree that following the budget announcement and the passing of the Estimates the forecasts for the Exchequer outturn appear to have been much gloomier than they turned out to be and that his Department adhered strictly to the recommendations in the report of the special review on Estimates and brought forward the doubling of disease levies? There are now additional costs for testing for BSE as well as the Government withdrawal from subsidising the rendering of meat and bonemeal. The farming community, rightly, is outraged at this complete desertion by the Government of a community that has suffered an income loss of 8.5% in the past year, probably the only section in society that has suffered as much. On top of that difficulty the Department imposed draconian measures on the farming community.
In all honesty, did the Minister expect the farming community to enter the partnership and what did he offer the farming community, aside from aspirational commitments to negotiate on its behalf with respect to the mid-term review? Will he agree that some small tangible measure could have been brought forward, such as the reversal of the resolution on disease levies? Obviously flexibility is a great leadership quality. What some view as a U-turn can be viewed by others as innovative, and decisions can be made in the climate of the time. Will he agree, even at this late stage, to look at the reversal of the resolution on disease levies and re-examine the Government decision to abolish roll-over relief?
Deputy Timmins said some small gesture should be made to the farming pillar in the partnership talks. I reiterate that tangible and solid commitments were made. The proposal in relation to the farm pillar extends to approximately 16 or 17 pages. I estimate that the cost of those proposals over the lifetime of the partnership would be up to €300 million. The difficulty is that the farming interests had a set of requests which would cost in excess of €1 billion. Like all other participants in the partnership talks they were not able to get as much as they sought. Having regard to everything concerned, a set of proposals costing an estimated €300 million was reasonable taking the budgetary consideration into account.
In regard to disease levies, for 2003 the Estimates include a provision of €216 million for measures relating to disease. In the context of increasing from €10 million to €20 million within an overall cost of €216 million the commitment in the partnership talks to review this whole matter this year is a reasonable one. Some people referred to the 1996 agreement. The 1996 agreement, in relation to disease levies, stated specifically that they would be fixed at £10 million per year or 50% of the compensation costs, whichever was the higher. Compensation costs last year amounted to €90 million.
The time for this question is—
Taking everything into consideration, we have to be reasonable. To go back to excessive borrowing would hit farmers more than any other sector.
May I—
Sorry. Deputy, we have spent six and a half minutes on that question.
On a point of order, what is the time breakdown?
The time breakdown is two minutes to the Minister to reply. There are four minutes for supplementaries. Obviously Members asking supplementaries should ask just a supplementary question briefly and I hope that Ministers in response will allow for a second supplementary. The Chair's experience is that Members asking supplementaries often take more time than the two minutes the Minister is allotted when replying to the initial question.
In regard to the latter part of your reply, a Cheann Comhairle, may I respectfully submit that you try to impose that strictly on Ministers.
Other than the two minutes of the Minister's initial reply and the inclusion of the remainder of the reply in the Official Report, the only function of the Chair is to ensure the four minutes are used in supplementary questions. In Standing Orders there is no division of that time. In regard to ordinary questions, as the Deputy is aware, there is a minute for the Deputy and a minute for the Minister, but that does not apply to priority questions.
If I asked a supplementary that took two seconds, in theory the Minister could continue to reply for three minutes.
In theory that is correct but I do not think any Minister would do that.
