Gay Mitchell
Question:8 Mr. G. Mitchell asked the Minister for Agriculture and Food his plans to manage the milk quota; and if he will make a statement on the matter. [9094/03]
Written Answers - Milk Quota.
The changes introduced to the milk quota regime in Ireland in 2000 have been extremely successful in achieving the overall objective of putting quota definitively in the hands of active producers, at the lowest possible cost. Due largely to these changes, in the last three years alone, about 460 million litres on 105 million gallons, of quota have been redistributed under milk quota restructuring schemes. This is more than the total quantity of quota restructured in the previous ten years and almost 10% of the national quota. Nearly 90% of the restructured quota has gone to the small and medium scale categories of producers.
However, notwithstanding the success of restructuring in the past and the increase in the average size of quotas, it is widely acknowledged that milk producers need to further increase their scale in order to cope with the competitive challenges they will inevitably face in the coming years.
The 2003-04 restructuring scheme, published this week, recognises the increasing size of producer quotas, mentioned earlier, by increasing the priority category size bands upwards by about 10% and also by adjusting the distribution formula to give producers in the critical middle band a more favourable position than heretofore. The provision in this year's scheme which will have the greatest long-term impact relates to new entrants. I decided that from the 2003-04 quota year a young person who farms at home, and forms a partnership with their parents that is registered as a milk production partnership, and satisfies other criteria will qualify for a new entrant allocation while using the facilities at the home farm. This will, in particular, provide opportunities for young committed producers who possess the training and expertise to make a major contribution to the sector.
I introduced milk production partnerships in 2002. As provided for in the regulations, an early review has taken place and I have, this week made some changes to take account of the experience gained in this first year of the operation of the provisions relating to those partnerships. I am convinced that if this innovation is carefully developed it offers scope, whether in a family setting or otherwise, to get the best return from the energy, commitment, skills and capital invested at farm level in the dairying sector and will be an important part of the drive to boost the competitiveness of the sector.
It is my policy to continue to seek ways to improve the performance and structure of the sector and reduce where possible the rigidities that can be part of a quota based regime, without losing the benefits that a supply control regime has delivered in terms of reasonable producer income, fair consumer price, low subsidy cost and wide market access over a long time. In doing so, I will continue to work in consultation with the milk quota review group and the industry generally.