Dáil Éireann debate -
Tuesday, 5 Oct 2004

Vol. 589 No. 3

Adjournment Debate.

Pigmeat Sector.

Mr. N. O’Keeffe

I thank you, a Leas-Cheann Comhairle, for allowing me raise the important issue of the difficulties arising in the pig industry. I welcome the Minister to the House. I am delighted that she is a Cabinet Minister who is prepared to face her responsibilities in the House. I wish to raise a matter of national importance, the closure of the pig slaughter line at the Galtee Foods Division of Dairygold Co-operative Society Limited in Mitchelstown, County Cork. Galtee Foods has a killing capacity of 10,000 pigs per week. The national kill of pigs is approximately 56,000 per week. The national breeding herd is 160,000 and 60% of the pigs slaughtered in Galtee Foods are produced locally. Its closure will create a national disaster for the industry, similar to what occurred in 1998 which did not affect the Cork area at that time. In 1998, when I was Minister of State, the Minister, Deputy Coughlan and her colleague, Deputy Keaveney, made many representations to me about the difficulties facing small pig producers in the Donegal area. The decision to close the kill line in one of Ireland's largest co-operatives, which is fully owned by farmers, will ensure the demise of many producers around the country and is a wild west decision taken in conjunction with Enterprise Ireland.

I am annoyed at the failure of the Government as the regulatory authority to intervene in this decision. Substantial grant aid has been paid to Dairygold over the years, thus creating further wastage of taxpayers' money. I have requested the Comptroller and Auditor General to investigate Enterprise Ireland and carry out a forensic audit of its food division. This organisation suffers from the corporate box syndrome for the big boys, especially the plcs, private limited companies, who like to import against Irish producers. The island of Ireland will have no pig industry five years from now if this decision is followed through.

The sugar beet industry and the poultry industry are all heading in the same direction. The Minister has a tough task ahead of her. This organisation in Mitchelstown was the only processor in the country with a USDA licence for pigmeat. These processing industries are all peripheral farming activities giving large incomes to farmers and substantial jobs in rural areas across this island. These activities and developments were supported by the Fianna Fáil policy makers for decades. The plant was built in the 1960s with money given by a Fianna Fáil Government under the then Taoiseach, the late Jack Lynch. In the last few decades the ground has been allowed to shift from these commodities, which are being replaced by imports of an inferior nature. Ireland has the lowest priced pigs in Europe but inferior cuts are being imported. This is what is about to happen in the case of Galtee Foods and other plants, with the encouragement of Enterprise Ireland. I ask that the people in the food division of Enterprise Ireland be transferred to other activities and fresh ideas and imagination be recruited.

Galtee Foods and Dairygold participated in a food fair abroad recently. The products they displayed were not of Irish origin. For example, Tipperary cheese is German-produced and I ask the Minister to investigate this further. It is claimed in theory that Ireland has a slaughter capacity of 58,000 pigs per week. However, a disaster occurred this week in Galway where Duffy's of Gort was destroyed by fire. It can be seen how marginal the slaughter capacity is at between 55,000 and 58,000. Taking holiday time and all the other down time of the daily work day into account, being practical and using common sense there is not sufficient capacity to slaughter the national kill. This argument was rehearsed many times in 1998 when pigs could not be killed and yet it was claimed the capacity was there. I was Minister of State at the Department of Agriculture and Food at the time. As the Government of the day, we were seriously embarrassed when hundreds of small producers in the Border counties left the industry, having been forced out and totally disillusioned as they could not get their pigs slaughtered.

I wish to thank the Taoiseach for meeting with a group in Clonakilty recently to discuss this matter. However, since this meeting no action has been taken. I again appeal to the Taoiseach and the Government not to allow farmers and workers in this region to be sold out.

The Government is the regulatory authority of the food industry. The Minister has the power in her hands to regulate this industry. She controls the grants and pays the money to organisations. I ask her to withhold payments until this plant is put back in place. There is no financial need and no justification for its closure. The Department's officials will say that it will continue to process bacon and pigmeat but that is a nonsense. There is no guarantee they will be pigs of Irish origin.

I will list the slaughter capacities for the Minister's information. Glanbia slaughters 24,000 pigs at peak; Queally's slaughters 9,000; Galtee Foods, 10,000, and they are on the way out. McCarron's slaughters 3,000; Dromone, 2,000; Ballon, 1,400; Drumlish, 2,200; Duffy's, 1,300; Green Pastures, 1,700; O'Connor's, 448; Cuniffe's, 150. Kyle's in Dublin is about to close and slaughters 300. That is a total of only 51,000 pigs. Some of our pigs are killed in Northern Ireland. We never talk in an all-Ireland context about anything except when it suits us and we are now talking in that context. Subtracting 10,000 pigs from 56,000 leaves 46,000 pigs.

Many peripheral plants have no guarantee they will be operating tomorrow or the day after and they account for another 10,000 pigs. It is becoming a crisis. I ask the Minister to contact the chief executive of Dairygold as a matter of urgency. I ask her to get a commitment from him to reopen this plant, work in conjunction with producers and not to take decisions that are not in the best interest of the Irish industry. There is no justification, financial or otherwise, for this wild west decision. There will be more said about this matter in the House before 1 November. I await the Minister's reply.

Minister for Agriculture and Food (Mary Coughlan)

Ba mhaith liom, ar dtús báire, mo bhuíochas a ghabháil don Teachta as ucht ócáid a thabhairt dom cur in iúil don Dáil cad atá ag dul ar aghaidh. The decision by Dairygold Co-Operative Society Limited to close its pig slaughter line was a commercial one for the society, made in the wider context of Dairygold operations and in accordance with broader rationalisation objectives. I fully understand the huge level of disappointment for any employees and their families affected by this issue. I also understand and share the concerns of pig suppliers and producers to Galtee Foods who have traditionally supplied pigs to Galtee processing plants but are now faced with the prospect of finding alternative outlets for their animals.

Since the announcement of the Galtee closure, my Department has maintained regular contact with IFA, Enterprise Ireland and other pig processors, with a view to ensuring that a seamless and streamlined transition of the producer-processing supply chain would be established. There is agreement among the main processing entities and by Enterprise Ireland that sufficient processing capacity is available in the country to absorb the surplus that will arise from this closure.

I have been assured that the 9,000 or so pigs that were processed in Galtee on a weekly basis can be satisfactorily accommodated in other plants within the country. This means that there should be no disruption to processing nor to trade and that farmers will have a ready-made outlet to which pigs may be sold, resulting in different processing outlets but no restriction in processing options nor in marketing outlets. I am encouraged by the considerable efforts being made by Galtee, the IFA and other processors to ensure a smooth and orderly transition of the Galtee supply base. This is critical to the future profitability of the entire pig processing chain and will ensure that the transition is managed in the shortest possible timescale and with the best possible outcome for all concerned. It is also critical to the maintenance and continuity of supply to the retail sector and will demonstrate the capacity of the Irish pigmeat industry to respond effectively and constructively to a challenge such as this. I am encouraged that Galtee has indicated its intention to continue to process pigmeat in Mitchelstown, using the valuable Galtee brand name and utilising Irish raw materials.

There is never a good moment to announce a restructuring that causes either market disruption or job losses. However, decisions that have broader strategic aims are often critical to maintaining and expanding markets and jobs in other areas. One of the strategic aspects of this closure concerns the national structure of pig processing in Ireland, which, according to the Prospectus study on the pig industry published in 2000, concluded that there was serious over-capacity in the pig slaughter sector and that this burden of capacity was causing inefficiencies.

It recommended that rationalisation of existing slaughter capacity must be undertaken if primary processing in Ireland is to remain competitive. This would mean that excess capacity must be removed by plant closures with a commensurate increase in capacity utilisation of the remaining plants.

One effect of the Galtee closure is that there should be greater utilisation of slaughter capacity elsewhere, as recommended by Prospectus, which, in turn, should provide a better platform for the Irish pigmeat industry to tackle competition head on from abroad. Anything short of best competitive structures to deal with competition on the home and export markets will deprive our primary production sector of viable and profitable outlets for its produce and reduce Ireland's capacity to maximise the production of top quality products at competitive prices. The decision has been taken for Galtee's own commercial reasons. At this juncture, it is in the interest of all concerned in the sector to ensure there is no resultant disruption in the slaughter of pigs as a whole and that the important producer-processor chain continues to be treated as a fundamental element in the future success of the industry.

Schools of Music.

Mr. Allen

I am glad of the opportunity to raise this matter. At the outset, I declare an interest in that my three daughters attended the Cork School of Music, and one still attends as a student. I suppose, therefore, I have a personal interest in the matter. I welcome the Minister for Education and Science, Deputy Hanafin. I hope it is the start of good habits whereby Ministers answer matters raised. Too often we see Ministers with no relevance to the area in question coming in to give standard answers. I welcome what I hope is the start of a new practice.

Before the general election in 2002, and long before that, we were promised by the then Minister for Education and Science a new Cork School of Music. Again in March of this year, that promise was repeated. It is no coincidence that it was just a matter of months before the local government and European Parliament elections. Three Ministers later, we are still waiting for the school. The recent disclosures regarding the future of Jarvis, the company involved in the public private partnership, are alarming. The announcement was made after a protracted five year battle by staff, local representatives and members of the public who correctly recognised the need for a new Cork School of Music. The project was to be the first purpose-built school of music in the country, to be operated by Jarvis Projects as a public private partnership for 25 years, and was similar to other projects undertaken between Jarvis and the Department involving five schools.

Last week the Comptroller and Auditor General expressed reservations regarding difficulties with the public private partnership. I do not have the time to highlight the core issues of concern expressed by the Comptroller. Last July I understand the Cabinet was briefed about serious financial difficulties threatening the future of Jarvis. According to newspapers, Jarvis was in negotiations with its banks to reorganise its €287 million debt — Jarvis shares have fallen by 90% in the past 12 months.

In the UK, I am told, Jarvis has £4 billion sterling worth of public private partnership contracts and is responsible for managing approximately 100 schools. Newspaper reports have warned that if Jarvis were in serious financial difficulties, it could leave the schools involved in considerable difficulty. Again, Jarvis has issued four profit warnings in recent months.

The Comptroller and Auditor General has expressed concern at the manner in which the project has been managed to date. The decision by the Department to choose Jarvis as a preferred bidder before the affordability of the project had been established left the State open to claims for compensation if the project did not go ahead. Jarvis is due to build nine schools in Scotland but a number have fallen through and have cost Jarvis the contract worth almost €250 million.

After all the uncertainty and the promises, I am simply looking for a clear-cut statement from the Minister on the situation. I hope she will clear up the uncertainty about the construction of the Cork School of Music. I was in the school with the Fine Gael Party leader, Deputy Kenny, and I was appalled by the substandard conditions. I hope the Minister will make a clear-cut statement about the situation. Cork will celebrate its role as European city of culture next year and at this stage our hopes of having the school built to mark the year of culture have evaporated.

I am looking for a statement from the Minister on the current situation and a guarantee that if the arrangements with Jarvis fall through, this school will be built using Exchequer funding. The country is awash with money. The Government owes it to the people of Cork to fulfil promises made before general and Europe Parliament elections. If this school were located in Dublin, it would have been built long ago. I ask the Minister, on her first night as Minister answering an Adjournment debate, to give Cork the school for which it has waited so long. The students and staff deserve it.

Minister for Education and Science (Ms Hanafin)

Ba mhaith liom mo bhuíochas a ghabháil leis an Teachta as ucht an ábhar tábhachtach seo a ardú sa Teach agus guím gach rath ar a thriúir iníon atá ag déanamh ceoil ins an choláiste. This is an important issue. As Deputy Allen is aware, the Government decided last July that the Department of Education and Science should finalise contractual negotiations with Jarvis Projects Limited with a view to commencing construction of the new Cork School of Music public private partnership project. Around the time of the decision, it became apparent that there was some uncertainty about the company's financial position and the Government stipulated that before the contact could be signed, the Department must first be completely satisfied of Jarvis's legal and financial viability in being able to undertake and complete the contract. The Government required two specific measures to be undertaken by my Department before the contract could be entered into with Jarvis. The first measure is in regard to obtaining legal and financial advice on the viability of Jarvis and the second issue was to refer the draft contract terms in regard to debt repayment in the proposed contract to the National Development Finance Agency for consideration.

The first issue is being examined by my Department's specialist advisers to the project. In addition, the Department's officials and its advisers are in regular contact with Jarvis and are monitoring closely the present financial issues surrounding the company. In regard to the debt repayment terms, my Department supplied all the relevant information available to date to the National Development Finance Agency and has been in close contact with the senior staff of the agency regarding the matter. Late last week the agency gave its initial advice and that is now being examined in the Department.

Clearly, my Department cannot proceed to financial close unless there is a clear indication from Jarvis Projects that it has the necessary financial backing from its funders and that it is in a position to sign the contract. In this regard, I understand that the issues and discussions between Jarvis and its bank surrounding funding of the project are almost complete and that a decision is imminent. All indications are that the decision is likely to be positive.

As Deputy Allen has suggested, I make it absolutely clear that the Government is committed to the Cork School of Music project. Once the appropriate financial backing for the project is secured by Jarvis and approved by my Department, our advisers will be instructed to expedite completion of the documents in conjunction with the National Development Finance Agency to allow the contract to be signed as soon as possible. I thank the Deputy for raising this matter and I look forward to opening the new building.

Education Projects.

Mr. Boyle

I am grateful for the opportunity to raise this matter and I thank the Minister for making herself available to make her first presentations to the House on two issues which affect my constituency. After her contribution, I think a decision on the first issue is less than certain. On the second issue, the PAGE project, I ask the Minister to reconsider how decisions are made in her Department and the effect of such decisions

The project for adult guidance in education is Cork's response to a national development plan-funded initiative on foot of the White Paper on Education which outlined the need to provide guidance services for adults from disadvantaged communities, people who had undergone long periods of unemployment and people who were coming out of certain social situations, such as imprisonment, or had undergone traumatic incidents in their lives, such as the effects of residential abuse. Having first been funded in 2000 and since for a number of years by the Department, the project received a letter in December 2002 stating that further to the progress made by the project, the Department would fund it from 2003 onwards. Funding came through in 2003 and to date has also come through for 2004. Unfortunately, a letter was received by the project in December 2003 which asked for the project to be explained in terms of the original contract. Correspondence was immediately sent to the Department and no other contact was made with this project until August-September of this year when a cold letter was received by the project stating that monitoring had taken place and a decision had been made on foot of that. That is unacceptable in its own right in terms of ongoing planning, expectations and the quality of the service being provided, but it was even more unacceptable given that people recognised by the Department as being in need of such a service were availing of it and in view of the Department's lack of a discernible strategy as to how this service could be provided on an ongoing basis.

No communication has been made regarding what monitoring took place and what the effect of it was. The people who came down to undertake the monitoring in the interim period had given every indication that they were satisfied with the work being done on the project. Prior to the allocation of funding for the period 2000-05, the Department's analysis was that progress had been made in the earlier life of the project. The Minister needs to ask why this cold decision was made in such a way as to pull the rug from under so many people — those availing of the service as well as those providing it. She also needs to address the question of how the service will be provided from now on. If the White Paper on Education means anything it must mean that guidance services are provided to improve education standards and educational attainment which the conventional education system is unable and sadly, in some cases, unwilling to provide. The success of the project for adult guidance in education in Cork is that it provided such an opportunity for many people. As an elected representative for the area, I would like to know what measures will be put in place to provide such an opportunity for many people whom I believe will not, otherwise, have such an opportunity.

I accept the Minister is only a few days into her portfolio but I hope her background in the education system and her experience as an elected representative in the House and at various departmental levels will inform her that this is not the right way to make a decision, either in the short term or in the long term, for meeting the needs of those who are disadvantaged in society. I ask her to try to put this in the context of a strategy and a policy for adult guidance for disadvantaged people, which currently appears to exist on a wing and a prayer. It appears to be operating very much in the shadows and it needs to be given substance. When a system is up and running it is not acceptable for those who provide the system to get a slap in the face from the Department. I would like to see a better approach being taken. Reversing this decision would be a good way for the Minister to begin her Ministry.

Ms Hanafin

I thank Deputy Boyle for his good wishes and for raising this important issue. He will be aware that delegated responsibility for the area of adult education lies with my colleague, Deputy de Valera, although it is obviously one in which I also have an interest. Equally, Deputy Boyle will recognise the expansion of the adult educational guidance initiative service in the past three years where funding has increased from £150,000 in 1999 to €3.2 million in 2004 in recognition of the need that exists.

The Department launched the AEGI in 1999 in response to recommendations in the Green Paper on adult education. The service offers information, advice and guidance on an individual and group basis to assist adult learners to connect with learning opportunities in the further education sector. Since June 2004, the initiative consists of 24 projects located throughout the country in urban and rural areas. The projects provide a high quality adult education guidance service to participants on the vocational training opportunities scheme and literacy and adult community education programmes.

Financial support for an adult education guidance project in Cork city was approved by my Department in 2000 on a pilot basis as part of phase 1 of the adult education guidance initiative to address the guidance needs in Cork city. A service agreement drawn up by my Department was signed by PAGE in January 2003. The project is community-based and operates as a limited company. Most of the AEGI projects operate through the local vocational education committees. The funding of each of the adult guidance projects is subject to ongoing satisfactory delivery and evaluation.

As part of the ongoing evaluation of the service being provided, my Department became concerned during 2003 that an education guidance service was not being provided to the identified target groups in the Cork area. It was not the case, as Deputy Boyle alleged, that a cold decision was made. The Department decided to place the project on a six-month probationary period and it duly notified PAGE of the decision on 17 December 2003 and of the four conditions to be implemented with immediate effect. Following ongoing monitoring and evaluation of the service being provided to the designated target groups, my Department was not satisfied that the project was fulfilling the terms and conditions of the service agreement signed in January 2003. Accordingly, it was decided not to continue funding the pilot project in Cork city. However, I accept adult learners need the service of the adult education guidance service and the Department will be taking steps in the very near future to make sure that an adequate service will be made available to adult learners in the Cork area. I will keep in touch with the Deputy in that regard.

Housing Aid for the Elderly.

Ms B. Moynihan-Cronin

I welcome the opportunity to raise this important issue and thank the Minister of State, Deputy Noel Ahern, for attending.

Housing aid for the elderly is a scheme funded by the Department of the Environment, Heritage and Local Government and administered through the health boards to allow elderly people carry out essential structural work to their homes. In the main, it is confined to those over 65 years to help them meet the cost of replacing doors and windows, install dry lining, heating and other small-scale but essential work in their homes.

It is unfortunate this valuable scheme is chronically under-funded. Waiting lists are lengthy. In County Kerry the funding shortfall for housing aid for the elderly is so acute that waiting lists for applicants are extremely lengthy. The sole person dealing with applicants in Kerry is now only getting around to dealing with applications submitted in April of this year. This is due to the chronic lack of funding for the scheme from the Department of the Environment, Heritage and Local Government.

What is the point of assessing people's applications when there is no money to allocate to successful applicants? The budget allocated to the Southern Health Board for housing aid for the elderly in Kerry has run out for this year. Only a paltry €1 million was allocated to the Southern Health Board in 2004, an area comprising the counties of Cork and Kerry. Only 27%, or €270,000, of the total sum was allocated to County Kerry. Elderly people in County Kerry, many of them living alone and in poor health, must wait months before they are even assessed.

I am currently dealing with an applicant in the west Kerry Gaeltacht who applied for housing aid for essential work on his rotten windows and doors in July 2004. However, I am advised by the health board that it will be 2005 before his situation is assessed, because the 2004 funding has been expended. This is not the fault of the individual dealing with assessments. The health board is only dealing with the first four months of this year, and if that continues, it could be 2005 before those who are applying this month for housing aid for the elderly are assessed. This is totally unacceptable.

It is appalling that elderly people who cannot afford basic repair work on their homes are being treated in this way, particularly when we hear every day about all the money that is flowing into the Exchequer. The majority of these people have only one source of income, the old age pension, which is totally inadequate as a means for carrying out repairs in the home.

The Government parties have spoken frequently about the need to allow elderly people to live at home with dignity in their later years. This was raised in the previous debate on carers. However, many of our elderly are living in old houses that are poorly heated, badly insulated and run down and for want of a few thousand euro cannot carry out essential repair work. There is also a security issue as often, doors and windows in these homes are inadequate and many people in rural Ireland are living in fear of attack.

I have spoken previously in this House about the low level of funding for other schemes, in particular the essential repairs grant and the disabled persons' grant, both of which are administered by the local authorities and often work hand in hand with housing aid for the elderly in the Southern Health Board area. In County Kerry there is a major shortfall in funding for these schemes and in respect of the housing aid budget. This is making the lives of many elderly people a misery.

I appeal to the new Minister for Health and Children, Deputy Harney, and the new Minister for the Environment, Heritage and Local Government, Deputy Roche, to immediately contact the Southern Health Board to ensure there is sufficient funding. They should put the appropriate resources into these schemes to allow the elderly people who have applied for a few thousand euro to make their houses comfortable and safe. I presume the Minister of State would agree with his party's guest speaker in Inchydoney about the need to care for the vulnerable in society. The Government now has an opportunity to do so.

Minister of State at the Department of the Environment, Heritage and Local Government (Mr. N. Ahern)

I thank the Deputy for raising this matter. It was also dealt with today under Question No. 443 in the name of her party colleague, Deputy Wall. I am pleased to have the opportunity to give her an update on the scheme. As the Deputy knows, the scheme was started in 1982 and is funded under the Department of Environment, Heritage and Local Government to undertake an emergency programme to improve the housing conditions of elderly persons living alone in unfit or unsanitary accommodation. In 2000 the scheme was extended to include the provision of suitable heating systems where found necessary to meet the needs of elderly persons. Since then the direction of the scheme has shifted very much from emergency work and much of its resources are now concentrated on larger projects.

The community care departments of the health boards operate the scheme using various mechanisms to carry out the work, including contractors, FÁS and a grant-based approach whereby the applicant employs the contractor. The scheme has dealt with more than 56,000 cases since it started. Just under 2,000 jobs have been completed in the first six months of this year. There has been an unprecedented level of demand for the provision of heating systems since it was introduced in February 2000, with 3,954 applicants provided with such facilities to the end of 2003.

The allocations to the boards are determined by a task force from the funding available and are based, not on the geographical spread of the population, but on the statistical returns received from the health boards showing the level of activity within the area. It is not based on population and, accordingly, some health boards do better than others. It is based on returns showing the numbers on the waiting lists, the number of applications on hands and the estimated cost of these applications. Boards, in turn, allocate the funding available to the county divisions within their areas. First round allocations were notified to the boards on 21 January 2004 and a second round allocation for 2004 will shortly be determined and notified to them by the task force, bringing the total to €11.6 million for the year. The original allocation was approximately €11 million, so the second is only €600,000, nationally.

Ms B. Moynihan-Cronin

Did the Minister of State say that was €600,000 nationally?

Mr. N. Ahern

Yes, nationally. The sum of €11.6 million is the overall figure. We paid out €11 million, so €600,000 is left and the source of funding is the national lottery. Funding levels for 2005 are being considered at present in the context of the Estimates. However, health boards are being requested, on the basis of funding being available next year, to arrange further jobs which will not arise for payment until January or later. They have the flexibility to carry out some work so long as the bills are not submitted until after Christmas.

I thank the various groups involved — the task force, the health boards, FÁS and the voluntary bodies associated with the scheme — who have done much good over the years. As the Deputy mentioned the scheme now works hand in hand with the essential repairs grant and the disabled persons' grant. I do not have figures with me for County Kerry, but in the last three or four weeks the Department——

Ms B. Moynihan-Cronin

They just want to put in windows and doors.

Mr. N. Ahern

That is up to the individual council. However, in recent weeks while there is a problem in giving extra funding for this scheme because of the sources of funds, approximately an extra €7 million has been offered to county councils under the disabled person's grant and the essential repairs grant schemes. It is up to the individual local authorities to determine the issues on which the money is spent.

There is no Department rule which says doors or windows are excluded. That is a matter for the individual council to decide and prioritise. I am not sure whether County Kerry took up the extra money offered to it in recent times. However, extra money under the essential repairs grant and disabled person's grant schemes has been offered to the Deputy's local authority over the last four or five weeks. How it spends that and the flexibility it has will determine whether that money is spent on doors or windows, as it wishes.

The Dáil adjourned at 9.10 p.m. until 10.30 a.m. on Wednesday, 6 October 2004.