Cuirim fíorchaoin fáilte roimh an Choimisinéir, atá sa Dáil den chéad uair le páirt a ghlacadh sa díospóireacht seo ar an earnáil talmhaíochta agus polasaí san Aontas Eorpach. D'oibrigh mé féin agus an Coimisinéir go dícheallach le chéile san Aontas Eorpach, agus ba mhaith liom mo bhuíochas pearsanta a ghabháil léi as ucht na tacaíochta a thugann sí don earnáil talmhaíochta sa tír seo.
Today's initiative is an ideal opportunity to reflect on the changes we have experienced as members of the European Union, to appreciate what we have gained and contributed and also to consider how the enlarged Union should continue to serve our people in a rapidly changing world.
National parliaments should reflect their involvement in EU affairs. The European Union forms an integral part of our public life to the point that it is often difficult to separate domestic issues from European ones. In that sense, European issues should be embraced as an integral part of our legislative process and so help underpin the democratic legitimacy of the Union.
There is a tendency on the part of the public to take for granted the massive benefits of EU membership and focus on the occasional more negative or restrictive proposal that emerges from Brussels from time to time. It is worth reminding ourselves, therefore, of the enormous advantages that have accrued to Ireland from our participation in the European Union. Our membership has been a key factor in the transformation of the economy. The benefits to every aspect of Irish life have been immense. As a small, open economy that must trade in order to prosper, EU membership has provided Ireland with a huge barrier free market for our products. That trading access and the single EU currency, combined with our highly educated workforce, tax regime and the social stability provided by our system of social partnership, have made Ireland an attractive base for companies exporting into the EU market.
We have derived enormous benefit through EU Structural Funds to develop our infrastructure faster than we would have done otherwise. EU funding has also underpinned such key elements of economic success as research and development and marketing and training, all of which have contributed to the high levels of economic growth that we have witnessed in recent years. Combined with EU membership, sound economic and fiscal policies, foreign direct investment and hard work have allowed the economy to reach its potential.
Agriculture is the sector in which the European Union has probably had the single biggest influence since we joined the Community in 1973. The agrifood industry has been among the principal beneficiaries of EU membership. In the period from 1973 to 2005 Irish agriculture received in excess of €36 billion in the form of direct payments and market supports. We also received some €2.7 billion for capital investments in farms and the food industry. The on-farm investment has increased product diversity and productivity and facilitated quality, hygiene and anti-pollution measures.
EU membership has transformed our food sector, in particular. Where once commodity trading was the staple of the industry, we now see a diverse, modern, consumer focused sector. As EU membership provided us with guaranteed access to a range of European markets, we could plan ahead to develop an industry able to compete with the best on international markets. The various supports offered by the Common Agricultural Policy provided stability and public funding for new routes to the market through capital investment in the industry, marketing, research and infrastructure. Follow-up private investment by companies and targeted assistance from the Government demonstrated high ambition, confidence, professionalism and a real understanding that change was not a one-off.
The agrifood industry has taken Ireland's two greatest resources, her land and people, and, through technology, innovation and sheer determination, built a dynamic and sophisticated sector that is feeding markets across the globe. Who would have thought 15 years ago that Ireland would be exporting over €1.5 billion of prepared consumer foods? Who would have imagined that Irish companies would be leading world players in the ingredients and cheese markets? Ireland is now the fourth largest food exporter in the European Union and our international reputation as the food island is well deserved, given the range and diversity of foodstuffs produced here. The agrifood and drinks sector accounts for more than 8% of Ireland's GDP, 7.1% of Irish exports and 9.5% of total employment. Gross output is valued at €16.8 billion, with exports of over €7 billion spread across Europe and the rest of the world. These are very encouraging figures considering the competitive pressures faced by exporters and it is clear that the EU Common Agricultural Policy has been a significant factor in the increased prosperity of the sector.
Enlargement of the Union, which we have supported and encouraged, has also provided us with opportunities. The accession of the ten central and east European and Mediterranean countries in 2003 added more than 100 million people to the population of the Union. The creation of a single market of approximately 500 million consumers without tariff or other trade barriers created a new impetus for growth in the market, with increased possibilities for all member states, old and new.
Agriculture has changed not just in Ireland since 1973 but throughout the European Union and the Common Agricultural Policy has been the subject of ongoing and broad-based reform for more than two decades reflecting the changing demands of society. Since the 1980s we have had continual reforms beginning with the milk production quotas introduced in 1984 and the budgetary stabilisers introduced in the 1980s. Over the past 15 years, the CAP has been subjected to three major broad-based reforms, in 1992, 1999 and 2003. There has been a fundamental transformation from product support as evidenced by the intervention mountains which were built up during the 1980s, to support for farmers by way of direct payments. These reforms have brought the CAP into line with present-day realities.
In June 2003, the Agriculture and Fisheries Council agreed the most fundamental reform of the CAP since its establishment. That reform is now being implemented by the member states. It was the most radical of all, in that it decoupled subsidies from production and provided that decoupled payments may be reduced or eliminated if a farmer failed to comply with 18 different EU legal instruments governing food safety, the environment, and animal health and welfare. Ireland, having negotiated strongly in the reform process, subsequently embraced fully the new developed model with the confidence that our agrifood sector can benefit generally from the flexibility provided.
These reforms will ensure that European agriculture is more competitive, more market and consumer orientated, better prepared, therefore, for globalisation, more compliant with food safety requirements, more environmentally sustainable and more conscious of animal welfare requirements. Farmers are now free to respond to market signals in their production decisions and to continue with traditional enterprises or to engage in new activities whether in other crops or products, forestry or even biofuels, as mentioned by the Commissioner.
The sector is barely recognisable today compared with ten or 20 years ago. I will give a few examples. In the 1980s and early 1990s there were more than 1 million tonnes of beef in intervention stores throughout the EU. Today no beef is in intervention. In the early 1990s more than 30 different types of premium were in place. We now have the single farm payment. In the early 1990s farmers were geared to maximising their income by increasing outputs and optimising support levels. Today they are geared up to meet market needs and consumer demands and to obtaining fair payment for the additional services they provide in terms of landscape, bio-diversity and recreation. In essence, the CAP is now focused on guaranteeing the continued availability of high quality, safe food, protecting the environment and addressing the overall social and economic needs of EU citizens. I am happy to say we are in the forefront of member states in implementing this new policy.
The mechanisms of the CAP have not been set in stone; they have been made responsive to evolving societal needs. In this connection we must be careful to control the pace of reform and to ensure that most recent reforms are bedded down. Farmers are entitled to a period of stability to come to terms with the new market realities in an non-threatening policy environment. The financial perspectives agreement of December last was a welcome development in this regard. The agreement in the European Council on the Financial Perspective 2007-2013, and in particular, the budget for the CAP and rural development provides much needed stability for the future. While a review of the EU budget will take place in 2008 and 2009, fundamental change or further CAP reform should not be contemplated before the beginning of the next financial perspective in 2014 and I will oppose any attempt to introduce any such change.
Rural development, the second pillar of the CAP, has become increasingly important in parallel with the reform process. To see the EU influence we need only consider the range of related measures that we apply here. I will give some examples. The compensatory allowance scheme benefits more than 100,000 farmers in the disadvantaged agricultural areas. The rural environmental protection scheme, REPS, has close to 50,000 participants and it is widely acknowledged as contributing to environmental enhancement. Both these schemes and many more benefit from EU support.
The EU rural development policy framework for 2007-2013 is a good one. It has three priorities — competitiveness, environment, and quality of life and the wider rural community. I fully support these priorities. In collaboration with the Department of Community, Rural and Gaeltacht Affairs, we are engaged in formulating a new rural development strategy and programme. In so far as the agriculture elements are concerned, the priorities set have a two-fold benefit. They will help the sector to adapt to increasing competitive pressure, and they will provide support for the public-good aspect of farming and the positive contribution it makes to the environment and land management.
While we can be satisfied with the outcome on the next financial perspective, the negotiations on the next WTO agreement now represent a major challenge, as the Commissioner has said. The negotiations aimed at liberalising trade and at reducing substantially the levels of support and protection which can be provided for agriculture are continuing with a view to concluding a new agreement later this year.
While world trade has been opening up in recent decades, there are still plenty of barriers to our agricultural and food products, industrial goods, our investors and our service providers. An overall agreement in which obstacles are reduced further would be of considerable benefit to the Union and to Ireland. A round that brings real gains in agricultural trade would also be hugely beneficial for developing countries. I am committed, therefore, to securing a new WTO agreement. However, I am determined that this will not prevent us, in the EU and Ireland, from enjoying the benefits of an active and supportive CAP and a rural development policy that protects the agriculture and food sector. In particular I welcome the Commissioner's view that this should be a balanced outcome.
