Adjournment Debate.

Milk Prices.

Deputy Paul Connaughton

I met a young farmer last week who showed me his milk returns for last month from his 40-cow herd. He was paid just over 19 cent a litre. This well educated and sensible young man literally had tears in his eyes, tears of frustration and anger. He proceeded to tell me how the cheque, the biggest he will receive this year, simply will not cover fertiliser and feed bills accrued during the months of April and May of this year which witnessed the worst weather conditions for 50 years. If the Minister of State is not aware of this situation then it is a case of shame on him. No one could produce milk at 19 cent per litre and one can imagine the problems farmers have in the wetland areas in which land has not been grazed for more than 12 months, simply because of waterlogging. We are witnessing the wind-down of the one of the most noble farming enterprises and if urgent action is not taken by the EU Commission and the Government, another sugar beet debacle will be on our hands.

There is no respect for primary producers of food in the country. In the case of milk, the farmer gets one third of the price of a bottle, the processor gets one third and the supermarket gets the final third. Who is walked upon in this case? Who puts in seven days a week, takes all the risks and who comes out the worst? I need not tell the Minister of State it is the farmer.

I put on record that the EU Commission must smarten up. More and greater volumes of milk product must be allowed into EU intervention and more funding to aid private storage schemes must be made available at rates that will keep dairy farmers afloat until world prices creep upwards. Matters within the control of Ireland must be re-examined also. The budget in October of last year will cripple farmers next October. Let us consider the savage cuts coming down the line. These include €1,000 off the top rate of the area base payment, which affects those in the wetland areas throughout Ireland, a reduction of 50% in the cow welfare scheme from €80 to €40, and a reduction of more than 2% in modulation in so far as the single farm payment is concerned. Let us consider the reduction in the REP 4 scheme from a maximum of €10,000 to €8,000. When these are added up an ordinary, average farmer in the country stands to lose €6,000 directly from his or her pocket next October or November and this bears no relationship to what such farmers earn.

During the last election there was a good deal of talk, rightly, of levies because they affected everyone. However, this levy works out at approximately 30% on the normal income that most average farmers will earn this year. Unless the Government takes action and reverses some of these cuts, which are entirely within its remit, there will be a catastrophe in the farming community of the country before the year is through. I realise many will say this is a case of the farmers crying foul again, but that is not the case this time. Every enterprise is under great attack.

The members of the Government should get up on their bicycles and go after the European Commission. I recognise the Minister for Agriculture, Fisheries and Food was in Luxembourg recently but it seems he has no clout and the process is going nowhere at present. If the Minister of State were a dairy farmer milking his cows seven days a week he would realise the severity of the situation. My background is farming and this is the first time in my memory that I have ever seen a situation in which for every marginal gallon of milk produced one is losing money. The price is below the cost of production.

Let us consider the case of a person highly geared, who cannot get grants from the Department, although such grants were guaranteed. If one puts all the pieces together it amounts to a very significant problem in the farming community. On behalf of every farmer in Ireland I call on the Minister of State to put his shoulder to the wheel and do something positive to try to get the whole industry on a better footing before it is too late.

Minister of State at the Department of Agriculture, Fisheries and Food (Deputy Tony Killeen)

On milk prices I point out that since last November when it became apparent that dairy commodity prices were in decline internationally from the record prices of only 12 months earlier, the Minister for Agriculture, Fisheries and Food, Deputy Brendan Smith, has been in close contact with the EU Commissioner for Agriculture and Rural Development, Ms Mariann Fischer Boel, and has been very active at the Agriculture and Fisheries Council to press for the activation of dairy market supports. These had been suspended since 2006 because of the historically high milk prices which prevailed in the intervening period. The Commission has taken a series of measures with a view to stabilising the market, commencing with the introduction of an aid scheme for the private storage of butter, some two months ahead of the normal date. This scheme remains in place and has already supported the storage of some 96,000 tonnes of butter.

In January export refunds were re-introduced for butter, cheese, skimmed milk powder and whole milk powder and this has enabled the export of considerable volumes of dairy products. In March, public intervention for butter and skimmed milk powder was opened. When the agreed intervention limit was reached the Minister, Deputy Brendan Smith, obtained the Commissioner's agreement for the continuation of these schemes under tendering arrangements at close to intervention prices. To date, some 81,000 tonnes of butter have been intervened with a further 202,000 tonnes of skimmed milk powder having been purchased into stock. In all, some 20,000 tonnes of butter and 27,000 tonnes of skimmed milk powder from Ireland have been stored under the schemes.

At the EU Council of Agriculture and Fisheries Ministers on Monday the Minister, Deputy Brendan Smith, again stressed the need to take further steps to assist in reversing the downturn and stimulating the market further. For example, intervention purchases of butter and skimmed milk powder are due to close at the end of August and the private storage scheme for butter shortly beforehand. The role that private storage plays in particular, but intervention too, is such that their continuation after the normal end dates will be crucial in preventing further market turbulence at a time when supplies would otherwise hit commercial markets. The Minister also called on the Commissioner to increase export refunds for butter and skimmed milk powder even further and to suspend the free at frontier price for cheeses enabling cheeses products to avail of export refunds. The dairy sector will remain at the top of our agenda in the coming months.

The Deputy referred to proposed reductions in farmer payments. However, he may not be aware that following representations from Ministers from several member states including the Minster, Deputy Brendan Smith, the EU Commissioner agreed to allow for an advance payment of 70% with effect from 16 October under the single payment scheme.

Deputy Paul Connaughton

It is the same money.

Deputy Tony Killeen

This will be of particular assistance to farmers experiencing difficulties in the dairy market and others and will mean that almost €900 million will be paid in mid-October to Irish farmers, rather than early December. At the CAP health check negotiations, the Minister secured changes to the modulation arrangements whereby we will no longer be required to make deductions in respect of the first €5,000 of a farmer's single payment.

Deputy Paul Connaughton

That is nothing.

Deputy Tony Killeen

It is a sensible change in the rules. It will mean that farmers will no longer have to wait for six months for a refund of deductions amounting to €350 in most cases.

With regard to budgetary decisions in general, Deputies will be aware that these were made in the context of the deterioration in the overall economic and financial environment. Our approach has been to strike a careful balance between increased borrowing, higher taxation and reduced spending. Clearly, there will be consequences for every sector of society. The Government has agreed a five-year plan with the EU Commission to secure stability and growth. In agriculture, the objective has been to protect the most productive elements of the agriculture, food, fisheries and forestry sectors and to ensure they continue to make the maximum contribution to the economy. It is vital that the sector be well positioned to get through this very challenging period and to exploit the opportunities that will develop as the international and national economies recover.

Against this overall background, one could easily forget the Government has provided more than €1.9 billion in the Department's Vote in 2009. When combined with EU funding of €1.4 billion, this means total expenditure by the Department in support of the agri-food and fisheries sectors this year will exceed €3.3 billion.

The agriculture and food sector has the capacity to help lead the nation's economic recovery in the years ahead. This is regardless of the economic difficulties Ireland currently faces. There is no doubt the country is fully capable of producing and exporting high quality food and drink products. Despite the challenging market, currency fluctuations and turbulent export environment, food and beverage exports in 2008 were worth approximately €8.2 billion to our economy. The agri-food sector represents our most important indigenous industry and has the potential to boost export returns substantially in the future.

The EU medium-term outlook for agricultural commodities foresees a gradual recovery supported by growth in global food demand due to population increase and also a long-term decline in the growth of food-crop productivity. These factors can work to the advantage of Ireland. Agriculture and food production are always subject to change and challenges and while agriculture is often more resilient to economic crises than other sectors, there is no doubt that certain parts of the industry are facing significant challenges this year. We will continue to work to help the entire agri-food sector remain competitive such that it may capitalise on the inevitable global recovery.

Addressing the industry's capacity to compete successfully at home and overseas has assumed a new urgency and my belief is that a new development plan for the period to 2020 is required to maintain the impetus gained from the very successful Agri-Vision 2015 strategy. Preparatory work has already started on this plan which is focusing on the critical issue of competitiveness, the challenges from the global economic downturn, currency fluctuations, climate change and how best to maximise the opportunities arising from a growing international food and energy crop markets.

Grant Payments.

Deputy Tom Hayes

The issue I wish to raise is almost identical to that raised by Deputy Connaughton. It is ironic that he comes from the west and I come from Munster from the heart of what is probably the best dairying, farming and agricultural county in the country. Over the past number of months I have seen at first hand the anger and frustration of the dairy farmers and the dairy industry in particular. Some weeks ago I stood outside Tipperary Co-Op where hundreds of farmers protested at the decision by the board of the co-op to reduce milk prices. The anger I saw there was the same as the anger I saw when the medical cards were being taken from the old age pensioners and they protested outside in Kildare Street. These farmers were losing their income and were unable to pay their bills to the banks. They had borrowed heavily to invest in their farms and to comply with regulations and to improve their farms so that their sons and their families could earn a living. I saw that anger at first hand. The anger was directed at the Government, at the management of the co-op and at the banks who do not care and have no interest in the future of these farming families.

When the subject of agriculture and keeping people on the land on viable holdings is being discussed, we need answers from the banks. Right across this country many bank managers are putting pressure on farmers to repay loans and are refusing to honour cheques. The reason this is happening is that milk prices have reduced so drastically. A price of 20 cent a litre and in some cases down to 19 cent a litre is what is being paid to farmers. It is not viable to continue milk production at that price. No serious effort is being made by the Government and the Minister for Agriculture, Fisheries and Food to make a case to Brussels in order to protect those people. We saw on television the anger of farmers from all over Europe. We were represented at that protest by the IFA and probably the ICMSA and others. The reality is that our farmers could not afford to travel to Brussels to make their protest because they are not able to pay their bills.

The farmers want the Minister to put a package together, which is what happened in the 1980s when farmers were in extreme difficulty as is the case today. Nobody is giving leadership. The Government needs to take a lead and put a package together to include the banks and the European Union. It must be seen what can be made available to subsidise storage for the products being produced by the farmers. This is where the problem lies.

I hope for a response from the Minister of State. Right across the country, whether in Clare, Tipperary, Galway, Longford or any other county, most of those counties depend on agriculture. If that industry dies on its feet, we will be very sorry. I am hoping for a very good response from the Minister of State.

Deputy Tony Killeen

Like all sectors of the economy, agriculture is facing very challenging times at present. The world recession is having an impact both on demand for agricultural products and on the cost base under which farmers are producing their goods for the market.

We have seen a severe downturn in the dairy sector which has not been helped by the international financial crisis. The Minister, Deputy Brendan Smith, recognises that dairy farmers are facing tremendous difficulties, with their prices below the cost of production and the prospects for recovery in the short term poor. Indeed, it is for this reason that the Minister has consistently urged the European Commission to make all efforts to support and stabilise the situation and to take effective measures that will stimulate the market.

There are also a number of difficulties in the sheep sector. Sheep numbers are declining, demand continues to fall in our main export market and while generic promotional campaigns have been put in place, there continues to be an uphill struggle for our producers. Our cattle sector is not immune from these difficulties either. It faces challenging times ahead with increased competition from low cost producers in third countries who will inevitably at a particular point in the future manage to meet the very high standards of production and quality required by the EU. Against this background, in the negotiations last year on the CAP health check, the Minister managed to secure access to additional EU funding to fund a suite of measures under the single payments regulation, targeted at vulnerable areas, particular sectors under pressure, improvement of animal welfare and-or agri-environment measures.

The use of unspent single payment funds is a new concept. Deputy Smith was the first Minister to raise this possibility in the context of the health check negotiations. We were delighted to have the support of most of our counterparts from other member states and the agreement of the Commission for this idea. The funds arise because the rules surrounding the single payment system mean that not all entitlements to payment can be drawn down. The amount of unspent funds available each year is based on the difference between the fixed annual ceiling for 2007 for these payments and the actual draw-down for that year, less a safety margin. The actual draw-down will vary from year to year, depending on the number of entitlements claimed. However, broadly speaking, the outcome means that Ireland will have access to approximately €25 million in additional funding in each of the next three years from 2010 to 2012, to spend on these targeted measures.

We have already secured an amount of €7 million in respect of 2009. The Minister decided some months ago that these funds should be directed at the sheep sector in the form of an uplands sheep payment. Under the scheme, approximately 14,000 hill sheep farmers will benefit from the new payment this year. On the basis of data available for 2008, the level of aid will be of the order of €35 per hectare with a maximum payment of €525 per farmer. Payments will commence on 1 December 2009.

In introducing this payment our main objective was to address the difficulties and specific costs, including compliance costs, facing the sheep sector. In reaching his decision the Minister was mindful of the need to ensure that it created no additional burden for farmers and was simple and inexpensive to administer. This payment, for which we sought and secured the agreement of the Commission, is for 2009 alone. In respect of 2010 and beyond, we have consulted widely with stakeholders on this matter and are well aware of their wishes. The Minister will be making his decision in the coming weeks and he will then submit Ireland's plans for use of these funds to the European Commission for approval.

These are not the only funds that will become available to Ireland over the coming years. Funds totalling €134 million will also become available over the four years from 2010 to 2013, from additional modulation agreed in the CAP health check and the rural development element of the European economic recovery package. These funds must be directed at measures addressing the new challenges of climate change, water management, bio-energy, biodiversity and diary restructuring. We are close to finalising the consultation process on the use of these funds and the Minister will be announcing his decision in due course. Our proposals for spending must also be agreed with the European Commission in a revised rural development programme we will be submitting to the Commission next month.

While I am not in a position to announce detailed funding proposals today, it is worth noting that this means EU funding of some €216 million for the Irish agriculture sector. The injection of this level of funding into the sector will have a significant positive impact on Irish farming and will assist our farmers in meeting the challenges facing them in the years ahead.

Deputy Tom Hayes

I can tell them it is coming.

School Staffing.

Deputy James Bannon

I thank the Ceann Comhairle for affording me time to discuss this important matter regarding the convent primary school, Rochfortbridge, County Westmeath, roll number 14603J. There is an urgent need for the Minister to reconsider the decision to suppress the eighth mainstream teacher post in the convent primary school, from September 2009. The enrolment in this school on 30 September 2008 was 206 pupils, one above the retention figure for September 2009 prior to the cutbacks announced in budget 2008. From September 2008 to January 2009, the enrolment fluctuated marginally upwards from 206 to 211 at the beginning of this year. This puts the school well above the retention figure of 207 required to retain the post for 2009 under the new guidelines. The reality of the loss of a teacher for this school, which has 42 pupils enrolled for junior infants in the new term in September, is that it will be forced to put children into multi-grade groupings of up to 31 per class.

The Rochfortbridge primary school, with rising numbers of pupils, has already outgrown its built environment, with three temporary classrooms or pre-fabs already required. The classrooms in the school are much smaller than average and incapable of holding amalgamated groupings. This poses a serious health and safety issue. This school accepts special needs children and it is obvious that those in this category in the lower classes will suffer educationally from large class groupings in the most formative years of their education.

One of the most important factors to remember is that schools such as Rochfortbridge convent primary were not built to accommodate the number of pupils that have applied for places, due to new housing developments and rising population figures that pertain today. This presents the school with a valid concern for health and safety.

I have said before about other schools in my constituency that are housed in substandard, outdated accommodation that the buck stops with the Minister and his Department and accidents caused by overcrowding and substandard buildings are directly their responsibility.

Rochfortbridge convent primary is a victim of its own success. The dedicated work of the principal, the board of management and the staff is much appreciated in the locality. It is a much sought after school serving the area and is caught in a catch-22 situation in terms of rising numbers. The school was coping well despite the limitations on space with eight mainstream teachers, but the loss of one will place it in an untenable position. It is unfair to pupils, teachers and parents to deprive this school of its most valuable educational tool — one of its much needed and highly regarded teachers.

I am asking the Minister to reconsider the educational, health and safety and child centred needs of the pupils of the convent primary school Rochfortbridge and allow it to retain this much needed teacher.

Deputy Tony Killeen

I am taking this Adjournment matter on behalf of my colleague, Deputy Batt O'Keeffe, Minister for Education and Science. I thank the Deputy for raising this matter on the Adjournment today.

The Minister for Education and Science is committed to providing information on the allocation of teachers to schools and as a new feature on the Department's website. The process has begun with the provision earlier this year of initial information on the allocation of mainstream classroom teachers to primary schools under the revised schedule for 2009/10.

In terms of the position at individual primary school level, the key factor for determining the level of resources provided by the Department is the pupil enrolment at 30 September 2008. The annual process of seeking these enrolment data from schools took place in the autumn and the data have since been received and processed in the Department, enabling the commencement of the processes by which teaching resources are allocated to schools for the school year that begins next September.

The Department has written to the primary schools that are projected to have a net loss or gain in classroom teaching posts in September 2009. As part of the Minister's efforts to ensure that relevant information is openly available to the public, detailed information on the opening position for primary schools is now published on the Department's website. This provisional list sets out the details on individual schools that, taken collectively, are projected to gain 128 posts and to lose 382 posts — a net reduction of 254 posts. It is the Minister's intention to have this information updated, and ultimately, to set out the final position when the allocation processes are completed.

Within the terms of the staffing arrangements for primary schools there is provision for additional posts, referred to as developing school posts, to be assigned to schools on the basis of projected enrolments for the next school year. Under these arrangements, a developing school post may be sanctioned provisionally where the projected enrolment at 30 September of the school year in question equals or exceeds a specified figure. If the specified figure is not achieved on 30 September, sanction for the post is withdrawn. The final position for any one school will depend on a number of other factors such as the additional posts for schools that are developing rapidly, to which I have already referred, and posts allocated as a result of the appeals processes. The operation of redeployment arrangements also impacts on the final position as a teacher can remain in his or her existing school where a suitable redeployment position does not exist. The final staffing position for all schools will therefore not be known until the autumn. At that stage the allocation process will be fully completed for mainstream classroom teachers and appeals to the primary staffing appeals board will have been considered.

At its meeting on 14 May 2009, the appeal board considered an appeal submitted by the board of management of Rochfortbridge convent primary school. The appeal was considered under section 10 of the primary staffing schedule (circular 02/2009) which is available on the Department's website at www.education.ie. The appeal board decided that a departure from the staffing schedule was not warranted in this case and therefore refused the appeal on the grounds that the required pupil numbers were not validly enrolled in September or October 2008 in this school.

The appeal board operates independently of the Department and its decision is final.

I thank the Deputy once again for raising this matter.

Deputy James Bannon

Another quango. No accountability to the local community.

The Dáil adjourned at 10.30 p.m. until 10.30 a.m. on Thursday, 25 June 2009.

Dáil Éireann debate - Wednesday, 24 Jun 2009