On behalf of the committee I welcome the following representatives of An Bord Iascaigh Mhara: Mr. Jason Whooley, chief executive officer; Mr. Connie Kelleher, secretary-financial manager; Mr. Michael Keatinge, manager of fisheries development; and Mr. Donal Maguire, manager of aquaculture development. They are here to make a presentation to the committee. It is the first time they have been before the committee and they are more than welcome. Before calling the witnesses to make their presentation I wish to draw to their attention the fact that members of the committee have absolute privilege but the same privilege does not apply to witnesses appearing before the committee. Members are reminded of the long-standing parliamentary practice to the effect that members should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable. I now call on Mr. Whooley to make his opening statement.
Operational matters of An Bord Iascaigh Mhara: Discussion.
Mr. Jason Whooley
I thank the Chairman and other members of the joint committee for affording us the opportunity to attend this meeting. Before beginning my statement, I will briefly introduce my colleagues around the table. Mr. Donal Maguire is BIM's aquaculture development manager. He has been working with the organisation for the last 12 years. Prior to that, he had 12 years' experience in the salmon farming industry. Mr. Connie Kelleher is the financial controller and has just joined the organisation this year after 25 years' experience with US multinationals. Mr. Michael Keatinge is deputy CEO and fisheries development manager. He has 12 years' experience of working with An Bord Iascaigh Mhara.
As members of the joint committee will be aware, BIM is the specialist development agency for the Irish seafood sector. Our mission statement reflects this. We are dedicated to providing commercially relevant and innovative services to the Irish seafood industry. These services drive growth, opportunities, add value, enhance competitiveness and create jobs in a sustainable, natural, resource-based industry for the benefit of coastal communities.
BIM has been in existence since 1952 — that is, for 57 years. We have operated in hard times and in good times. In that time we have evolved from being fishing boat builders and fish sellers, which were the needs of the industry at that time, to our current incarnation wherein we provide a whole range of sophisticated support services which range from training to grant-aid, through to specialist environmental advice and quality assurance.
We have a nationwide presence in all the key coastal communities through our network of regional offices and officers, which are located in all the major fishing ports around the country: Killybegs, Greencastle, Galway, Listowel, Dingle, Newport, Union Hall, Castletownbere, Clonakilty, Wexford, Dundalk, Howth and Dún Laoghaire. Through those offices our sole focus is the development of the Irish seafood industry and thus we aim to sustain coastal communities which depend on that vital industry.
We have built up an expert staff over the years who provide a wide and unique range of services. BIM is literally a one-stop-shop for the sector. We know each and every seafood business in Ireland intimately. Through the local offices I mentioned, our officers are in daily or weekly touch with everyone involved in the business. We have a unique understanding of what is required to assist them to survive and — even in these straitened economic times — grow their businesses.
As an organisation, BIM is structured, focused and oriented solely to serve and develop the activities of Irish fishermen, fish farmers, seafood processors, exporters and retailers. It has trained almost every fisherman in Ireland for the past 30 years and also worked very hard to improve safety standards, both through training and the renewal of the fleet to keep it modern, safe and up to date. We have two training colleges, at Castletownbere and Greencastle, and three unique mobile coastal training units — similar to mobile cinemas — which deliver specialist courses at 30 coastal locations every year. In 2008, for example, we delivered more than 2,000 training places to upskill the industry. Some 650 of these places were on courses relating to basic sea safety and sea survival methods which are absolutely critical in what is a dangerous occupation.
BIM is engaged in a wide array of activities, all designed to help the sector. We are running projects relating to technology transfer — for both aquaculture and fishing — environmental management systems, technical conservation measures, inshore fisheries management, new product development, business development, seafood safety, seafood quality assurance, eco-labelling, young fisherman awards, safety awards, grant schemes to increase aquaculture output and many others areas. This sector requires a complex and specialist web of support services to bring it into the future.
The sector we support is extremely important in terms of the social structure of coastal communities. BIM supports the employment of 11,000 people in the overall Irish seafood sector. Employment is most significant in counties Cork and Kerry, where 2,800 people are in full-time equivalent employment. In County Donegal 2,700 people earn their living from seafood production. In the Galway-Mayo-Sligo area there are 2,400 full-time equivalent jobs, while in Wexford-Waterford some 1,500 people work in the sector.
The industry generates approximately €715 million annually for the national economy. This is split into €381 million in domestic sales and €334 million in export sales. BIM services a fishing fleet of approximately 2,000 vessels which support the direct employment of approximately 5,000 fishermen along our coasts. It is worth noting that every €1 paid in wages to a seafood employee leverages €4.50 in local communities. The ripple effect is huge and seafood is literally the lifeblood of many coastal communities.
BIM, as part of its constant willingness to change and evolve, has undergone a radical restructuring in recent years. We have slimmed down our staff numbers by some 20% in the past 11 months. At the same time, we have kept our output and productivity at the same levels as before through the use of flexible working practices. We have concentrated our services to the sector around five key areas, namely, business development, innovation, technology transfer, skills development and environmental services to improve the industry's sustainability performance.
We believe this suite of services is what is required to bring out the potential which independent experts agree is locked into the sector. For example, both the Cawley review group — the report of which is guiding Government policy on the seafood sector — and the Marine Institute, through its sea change strategy, agree that the aquaculture sector has the potential to increase its output by 47,000 metric tonnes per annum in the next five years. This would generate an additional 1,500 full-time equivalent jobs, both directly employed and induced. Most of the seafood sector's output — approximately 85% — leaves the country. BIM has firm plans to improve this by 10% during the next two to three years, which will yield an immediate €35 million per annum in added value.
These are just a couple of examples of what can be achieved by the seafood sector. With its total unwavering focus on the seafood sector and coastal communities, expert staff base and regional structure, BIM is well placed to continue to lead the development of this important indigenous sector.
I deliberately kept my introductory comments brief because I am conscious of the time constraints involved. I am equally conscious that the significant number of Deputies and Senators present have questions to ask.
I welcome Mr. Whooley and his colleagues. I had the privilege to visit BIM's new headquarters in Clonakilty in recent days. I was quite impressed by what BIM envisages for the future and how it has set about the task of developing the industry and implementing the recommendations of the Cawley report.
It is difficult to ignore the elephant in the room, namely, the McCarthy-an bord snip nua report. There is no point beating around the bush. It hangs over the agency's head like the Sword of Damocles. I have the most serious reservations about changing horses mid-stream and establishing an entirely new entity to drive implementation of the Cawley report which provided a strategy for a restructured, sustainable and profitable seafood industry between 2007 and 2013. Mr. McCarthy has done some valuable work for the State, but he has examined the balance sheet for Ireland Inc. While that was a useful exercise, he could not have examined the seafood industry in the necessary detail to provide a blueprint or framework. Mr. Cawley did this only a few years ago and if he was of the opinion the industry would be best served by subsuming the agency directly responsible for driving its development into the Department of Agriculture, Fisheries and Food, he would have said so, but he did not. He called for greater inter-agency co-operation, including between FÁS, Enterprise Ireland and Teagasc. Where is BIM at in the context of such co-operation? In today's climate we cannot afford the luxury of overlapping provision at the taxpayer's expense and if greater efficiencies can be sweated out, it is incumbent on BIM officials, the committee and others to ensure that happens because taxpayer's money is more scarce. We cannot tolerate now what we could have tolerated a few years ago. How has co-operation developed between the various agencies mentioned in the Cawley report?
The Department of Agriculture, Fisheries and Food is perceived to be a Department of agriculture. The fishing industry has been on the hind teat for a long time and the momentum generated by the Cawley report for its development and sustainability and contribution to peripheral communities would be lost in the Department. If the agency was subsumed, the knowledge within it could be lost for a period that would be almost fatal to the industry while the agency bedded down in a new structure. I have concerns about this.
In the section dealing with agriculture, fisheries and food, the McCarthy report states: "In deciding the recommendations for the agriculture, fisheries and food Vote, the Special Group has taken into consideration the detailed evaluation papers prepared by the Department of Agriculture, Food and Fisheries and by relevant Vote sections in the Department of Finance". What interaction did BIM have with the group or the Department in feeding in its evaluation of its contribution to the report? Did meaningful consultation take place or was everything done via the management advisory committee of the Department? Did the agency have a direct input?
Mr. Whooley referred to a loss of 20% of staff in the past 12 months. What is the current staff complement? How slimmed down and efficient is the organisation if it has lost 20% of its staff and is delivering the same service? How has that been achieved?
Apart from the abolition of BIM, the McCarthy report also refers to ice plants. I was not aware the agency had ice plants. Will Mr. Whooley comment on this, given that ice is critical to the fishing industry? I thought fishermen produced the ice themselves. Who operates ice facilities other than BIM? It is incumbent on us to cherry-pick issues as not all of the report's recommendations will be implemented. However, some of them might be; therefore, I would like to receive more information on ice plants.
Reference was made to the network of regional offices and officers. The list is extensive and some of the offices stand out more than others; for example, I do not know why a coastal agency would have an office in Listowel. Perhaps Deputy Ferris might enlighten us. If there is room for efficiencies in the network of offices and officers, we must deliver them. The overhead savings identified in the McCarthy report amount to approximately €7.3 million. Do they arise from cuts in funding to the seafood sector?
The industry will need assistance to develop its potential. Will the delegation give us its views in that regard? Some specific areas have a great deal of potential — the committee has had a number of meetings to discuss the potential of the aquaculture sector. What is the potential to market organic certified salmon? What have our competitor countries achieved in that respect? What plans does BIM have to increase the levels of farmed salmon to match those of our international competitors?
What are the targets set for the amounts of fish exported without added value in order to create employment at home rather than in Spain, France or our major markets? What targets have been set to tackle import substitution which is probably the easiest sector of the market to go after?
How significant is the brand image of BIM? The organisation has been in existence since 1952. Will its credibility with international buyers be lost? Where will it leave the industry if it is subsumed into the Department of Agriculture, Fisheries and Food? These are some preliminary thoughts; it is unfortunate that this meeting will have to be predominantly concerned with the McCarthy report. As I stated, if it were the right thing to do, the Cawley review group would have identified it as a weakness. BIM is a strength that needs to be enhanced for the sector; it would be lost in the Department which is largely perceived to be a Department of agriculture. There is little by way of alternative employment opportunities in the coastal communities directly involved and these are critical days for them because what happens in the coming months will decide the fate of BIM. With that will be decided whether we grasp the opportunities to develop a restructured, sustainable and profitable seafood industry, as the Cawley group stated, or whether ultimately we state these are communities, industries and jobs that we will throw to the four winds, which would be a mistake.
I welcome the delegates and thank them for their presentation. Having been involved in the industry at one stage I am conscious of the major influence BIM had in the 1970s and 1980s. All of us who entered the industry did so with support from BIM and with boats built in BIM boatyards. The entire sector and BIM had huge potential, but, unfortunately, for reasons outside the control of the State, or perhaps because of the State's mismanagement of negotiations, the sector has been in irreversible decline for many years. What I mean by that is that communities are in decline; I am not talking about the value of fish caught. A selected number are, for various reasons, able to procure quotas beneficial to them individually but not to communities as a whole. I make no apology for saying this. Political interference has been detrimental to the development of the fishing sector.
I am emotional today because two days ago a great friend of mine was buried after being drowned at sea. He took care of his father until recently as well as his mother and gave his entire life to working in the sector. He went out in all types of weather to keep food on the table. Unfortunately, he drowned last weekend. Patrick Egan grew up in the fishing port of Fenit and knew no other way of living other than by the sea, with many other young lads in the area and our coastal communities. In our coastal communities today we find most young men involved in the fishing sector are drawing the dole because they have no work to do. They have consistently been forced out of the industry. While that process continues, unfortunately, the great work done by BIM and the service it has provided for coastal communities is being eroded practically to the point of elimination.
Fish sellers can no longer sell fish. Individually and collectively, people have tried to do their best by reducing staff numbers and budgets, but all of this is detrimental to coastal communities. Despite all the good work done, unless there is the political will to support the community and what it stands for, the social structure of coastal communities will continue to decline.
I commend the board on the tremendous work it has done to ensure the safety of those involved in the sector. The late Patrick Egan participated in it, but no matter what happens, human error will always affect safety levels at sea. If there is one mistake, it could all be over, as we know from the events of the past week.
Unless we reach a position where people can be allowed to catch enough fish to create a sustainable industry, how can we save the social structure of coastal communities? It will not happen. I share the significant fears expressed by Deputy Creed regarding an bord snip nua and further cuts which are inevitable. There has been no further consideration given to coastal communities. It has been mentioned that aquaculture has much potential and I concur. It was stated there would be an increase to 47,000 tonnes per annum in the next five years, which is possible. That is an area in which there can be improvements and 1,500 jobs created.
It is demoralising for those involved in the industry that the price structure has collapsed. Fish are continuously being imported from countries in South America, for example. This is in competition with local fishermen and makes it even harder for people to continue in the industry. Until such time as we have a proper quota, we are only moving in one way, which is unfortunate. The Common Fisheries Policy has not served Irish fishermen; neither has the political establishment, rather it has done the opposite.
The board has outlined the five areas on which it will concentrate — technology transfer, skills development, innovation, business development and environmental services to improve the industry. We cannot improve the industry if it is collapsing, which is what will happen if it is allowed to continue to decline. The fact that a number of boats can have an entire quota for one species while the rest are deprived of it is morally wrong.
I have nothing personal against the delegates and hope they will be successful in their endeavours. I have met Mr. Whooley before and know he is an honourable person who is doing his best in the industry. He previously worked in Castletownbere. I go to Castletownbere and Dunmore East and back to Dingle and Fenit on a regular basis and can see the entire area is only going one way and will continue to do so unless something radical is done. The only way to change it is to ensure people can fish and make a living on the fish they catch.
I welcome Mr. Whooley and his team and thank them for outlining in their short presentation the good work they do. It was simple, straightforward and to the point; there should be more of this at this committee.
There is one issue occupying all our minds. I must say to Deputy Creed that there is no point in beating about the bush. I refer to the suggestion in the McCarthy report that BIM should be disbanded or abolished. It is typical of what we can expect from somebody in Dublin 4 who has no idea what is involved in fishing, farming or anything happening in rural Ireland. If the group conducted any research, it would know at first hand the work BIM is doing for the fishing industry, particularly in promoting the value-added aspect of fishing, which is part of its brief. It is making the right moves to achieve this. The organisation has built a state-of-the-art premises in my town of Clonakilty at a cost of €28 million. If we were to go by what Mr. McCarthy is saying, we would have to close the door on it. The activity taking place there will be of major long-term value to the fishing industry, especially the promotion of new and value-added products, which will make the difference between the industry's surviving and going down the tubes.
I would like to know what consultation, if any, the McCarthy group had with BIM. It was stated the amount of money to be saved was €7.3 million, but I am sure the people within BIM would be well capable of achieving this. We have seen from the figures given that BIM has cut its staff by 20% by streamlining its business. If those involved were approached and spoken to, they would be able to achieve a saving of €7.3 million through further cuts or streamlining of activities. Those involved in BIM realise as much as anybody else that we must all take cuts and accept measures to achieve the required savings, and BIM is no different.
At a time when the fishing industry, like many other industries, is on its knees, BIM is more important than ever before. It is targeting fishing activities and productivity in the industry, which is needed. Many small industries are involved in fishing. I understand 200 or 300 are involved in processing and different activities in the fishing industry. They have to be small and are in different locations all around our coastline. There are quite a number in Castletownbere, Union Hall and different places. Altogether, some 2,000 people are involved. It is a significant number of jobs in an area where there is no possibility of getting any multinationals to locate. They account for about 80% of the jobs in such areas.
I return to my original point. A statement by somebody from Dublin 4 that the people down there will be cut off and the loss of 2,000 jobs is not important is very serious. We have a serious job to do in getting the message across that this cannot happen. Cuts will have to be made and we all accept that. However, BIM, as a driving force behind our industry, will have to be kept in place. I have a number of points I will discuss later on, but I will leave it at that for the moment and allow someone else to contribute.
I welcome Mr. Whooley and his colleagues. We seem to be moving to a discussion on the McCarthy report. It being what it is, there is no good news whatsoever in it. It is all about how one packages and delivers something.
Ireland has the equivalent of 80% of the French coastline, and yet for every 100 jobs we have associated with the fishing industry, France has 1,000. There is potential in the sector and for the Minister to cut its funding and eradicate BIM is a total folly. A strong message must go out from this committee to the Minister, that is, "Hands off BIM", because of the potential in the industry and the jobs that can be created. Value-added products that will go on the market will be developed from research done in the new facility in Clonakilty, as Deputy O'Sullivan referred to, which has cost in excess of €20 million.
The McCarthy report is all about cuts. There has been no input into the creation of jobs. I again stress the potential in the seafood sector. It is a natural resource and we are surrounded by water. If BIM was to be eradicated, its responsibilities would, I imagine, go back to the Department of Agriculture, Fisheries and Food. It reported to us in July 2009 that it is making progress regarding Natura 2000. It also reported to us recently that it is making progress on the operation programme of 2007, which is 20 months late.
I do not want to see the Irish seafood sector go into the Department of Agriculture, Fisheries and Food, given the incompetence it has shown regarding the responsibility it had for fisheries, namely, the operational programme and its part in Natura 2000. It is a sad indictment if this committee allows BIM to be eradicated and allows its responsibilities to be moved to the Department of Agriculture, Fisheries and Food. The suggestion regarding the ice plants is like sending a boat out 100 miles but giving it enough diesel for 50 miles. This arose in Dingle recently where there was a big furore before the local council elections. Lo and behold the Ceann Comhairle was able to keep it open and maintain the jobs for the two staff members in the ice plant. I do not know how much it costs to operate. The report recommends staff cuts of 1,140 under the Department of Agriculture, Fisheries and Food. If McCarthy or the Minister asked me to suggest where to cut up to 1,200 jobs within the remit of the Department I could do that without touching BIM.
Responsibility for marketing fish has moved to Bord Bia. I recall from the time before I became involved in politics that the BIM stand was always visible at trade shows in Europe and the media always highlighted it. The BIM brand name is recognisable. We cannot afford to let it go. I hope this committee sends the message to the Minister and the Cabinet that they should not roll over on this and destroy our seafood industry.
I too welcome the witnesses before the committee today. I congratulate Jason Whooley on the paper he read this morning. It does not surprise me that he has such a thorough knowledge of the fishing industry because he spent between ten and 15 years advising, and as chairman of, the Irish Southwest Fishermans Association. He made a terrific success of that organisation along the southwest coast. BIM was blessed to get a person with his acumen and knowledge of the fishing industry which he has studied well from A to Z.
I have no doubt that he could spearhead the stabilisation of the fishing industry provided that BIM is not disbanded by the bord snip report. As far as I can see bord snip does not take into consideration anything beyond the Pale. I do not think it cares about the people in rural Ireland who make a good living out of fishing and farming. Environmental issues and increasing costs limit the catch of the world's fishing fleet. As the population grows it is inevitable that future global demand for fish and other seafood will be satisfied only by farming our seas and fresh waters.
Even in Ireland more than 35% of all fishery products sold in supermarkets and restaurants originate on farms. They include salmon, trout, Arctic char, turbot, halibut, sea bass, sea bream, tilapia, mussels, oysters, prawns, shrimp and even tuna. Farmed cod and other white fish will also become increasingly available in the not too distant future.
There is vast potential for fish farming all along the western seaboard from Malin Head to Mizen Head, on to Carnsore Point and up to County Louth. We are only skimming the surface in that regard in view of the fact that 35% of all the fish available in supermarkets in Ireland is from farmed origin. The earnings the farmed fish industry could provide in rural areas would be of immense benefit to the small farmers because they can manage their farms while working on the fish farms. That would triple the number of people employed.
The Government and the Minister for Agriculture, Fisheries and Food should listen to Bord Iascaigh Mhara and learn from the experience of the work Bord Iascaigh Mhara has contributed to the sea fisheries industry over the years. Twenty years ago Bord Iascaigh Mhara was building high powered trawlers for the Irish fishermen, which were essential at that time. Today, there is a slow-down in the trawler business because decommissioning took many trawlers out of commission. The lack of quota also was a major drawback.
With Great Britain joined to mainland Europe by the tunnel, Ireland is the only island nation in Europe and we have a strong case to get a fair share of the fishing tonnage in the European and Irish waters. A strong case could be made by the people who go to Brussels to negotiate a deal for extra quota to be given to our Irish fishermen. They are working under serious impediments because of a lack of quota and, as Deputy Ferris said, that is the kernel of a great deal of hardship for the fishing industry here.
It is a well known fact that the waters of the North Atlantic ocean produce the best quality fish in the world. Our agricultural industry gained from our entry into Europe but our fishing industry went down the drain, so to speak, from the day we joined Europe because of the lack of consideration given to it in terms of the fishing waters we own. We own 24% of the fishing waters of the European Union yet we have ended up with 5% of the catch. That is a sad story and is something that must be corrected.
I hope there is not a Minister in the Cabinet who would be foolish enough to believe that seriously curtailing the activities of Bord Iascaigh Mhara will pay dividends for our nation. With almost 500,000 people on the live register, I cannot imagine where jobs will be created unless they are created in the fishing industry. Not many more jobs can be created in the agricultural industry in which an apex, as it were, has been reached. However, in the fishing industry, particularly the fish farming sector, the number of people engaged in fishing could be trebled along the western seaboard. I hope there is no Minister foolish enough to abide by what is proposed in the McCarthy report. It is easy to understand that this report emanated from people in comfortable surroundings in Dublin 4, who had no consideration for the people who are trying to make a living in south west Cork, south west Kerry and all along the western seaboard. All I can say to the Minister concerned is "hands off" the activities of Bord Iascaigh Mhara. The fishing industry will be finished if it is curtailed in terms of knowledge and its activities. They must not be curtailed if those involved are to safeguard the remnants of a shattered fishing industry.
I thank Mr. Whooley and his colleagues for attending. It is hard to get away from the fact that we are discussing this presentation against the background of a proposal to more or less subsume Bord Iascaigh Mhara into the Department. If we had heard presentation without that proposal having been made, this committee would have taken on board the way Bord Iascaigh Mhara's business and services are being directed into five key areas, which are listed in the presentation. The board seeks to increase our aquaculture industry and develop the value added end of the business. I presume that the reference to business development means that of the 200 odd companies that are in the business, they will be put into some structure which would allow them to be in a position to sell to big markets, because a critical mass does not exist currently as there are so many of them. I am not saying that the board would promote sales as it seems Bord Bia will do that, but Bord Iascaigh Mhara will mentor those companies to move towards an expanded co-operative structure. It will examine the number of jobs that can be created in the aquaculture sector. Even if 10% more jobs were created, it would result in an increase in the sector's fish exports from the current 85%, which would yield an additional €35 million per annum in added value. How many jobs could be created on foot of that additional yield of €35 million?
If we were not dealing with this presentation against the background of the McCarthy report, we would have said that Bord Iascaigh Mhara, having been established 57 years, has evolved into being in tune with what the modern day needs of the fishing sector. As Deputy Creed said, any proposals to change that mid-stream when we are at a point where we need to develop this industry will diminish the value of what the board has done to date. I am not being patronising in saying that. When it comes to negotiating our fishing rights and the anomalies and drawbacks we perceive exist in the fishing industry, it will send a message to people in Europe that will weaken our position. Bord Iascaigh Mhara, no more than the National Dairy Council and the branding it has achieved, are the original of the species of the quango, which were set up to captialise on our natural resources.
If we were to simply criticise the proposals in the an bord snip nua report, we will achieve nothing. We should examine this matter in the context of what Bord Iascaigh Mhara does. That should stand up on its own. The report was a balance sheet exercise, it did not undertake any cost-benefit analysis. It did not examine whether money was being spent wisely. They say one must speculate to accumulate, but that is the context of this report.
I do not know what the procedure is, but we should send an agreed resolution that the work of An Bord Iascaigh Mhara should be examined for its strategic importance to the industry. I do not think we can improve that by changing it in mid-stream. I have listened to the discussion and while it is easy to re-read a presentation, when one focuses on it, that is what it is about. BIM was set up initially because fishing was as natural resource back in the 1950s and it still is a natural resource. Deputies Sheehan and Sheahan referred to this in the context of jobs, given the amount of fish in our waters and how much we catch. There is a lot of room for development. We should commend An Bord Iascaigh Mhara for its work and support it. If the McCarthy report did not exist, we would be asking what else is needed by way of Government negotiations in Europe to help develop those five key areas.
Like other speakers, I would like to welcome the officials from An Bord Iascaigh Mhara. I compliment them on promoting the Irish seafood industry, as well as the safety aspects which were outlined in the presentation. I am from an inland county so I do not have great experience of what happens in this regard, but we happen to have two ports in Kilkenny, which is unusual for an inland county. We have a few good rivers for fishing. Like everyone else, I believe BIM has done a good job. The McCarthy report, known as an bord snip nua, recommended amalgamations and savings. According to the presentation, BIM has already made 20% savings, so it is ahead of the posse and saw it coming down the line. I wonder if further savings can be made.
We have had presentations by sea fishermen who are angry over fishing quotas. While we did well in the mainstream agricultural industry having joined the European Community, we got a bad deal for aquaculture. As has been said, we have 24% of the best sea fishing waters in the north Atlantic, yet we only have 5% of the EU fishing quota. It is both unbalanced and unfair. The sector is over-regulated. We seem to have a lot of fishery officers, whose representatives attended this committee last week. They seem to over-regulate our fishermen on catches and quotas. From what I hear, the fishermen are unhappy with the situation. In some cases they are criminalised and brought to court.
I would have concerns about getting rid of BIM, which has done a good job. I would like to see what is being put in its place. At the same time, an bord snip nua must be taken seriously because the country is in dire financial trouble. We must make savings, so I would like to hear the view of the BIM representatives on that.
Our quota is bad in terms of numbers so it should be everyone's aim to get something done and negotiate a higher percentage of the quota in Europe. In the course of his presentation, Mr. Whooley said the Irish aquaculture sector had the potential to increase its output by 47,000 metric tonnes per annum over the next five years which would create 1,500 jobs. Was he referring to farm fishing? When the quota system is in place, the only way output can be increased is through farm fishing. I would like to hear Mr. Whooley's reply to that point because 1,500 extra jobs would be badly needed.
Like my colleague, I am from an inland constituency which does not have a port.
Neither does the Minister's constituency.
Deputy Mattie McGrath should be allowed to continue without interruption.
I have happy childhood memories of Bord Iascaigh Mhara's advertising and promotional campaigns. However, the position has changed since then and in light of current financial circumstances, we must regroup and seek to reinvigorate various sectors. A major case can be made for BIM to remain in existence. As a previous speaker indicated, when it comes to quangos, BIM was the original of the species. BIM has done great work over the years and has transformed itself, particularly in the context of what it does in the areas of retraining, upskilling and health and safety, which is a major issue for any industry. Many self-employed people operating in the seafood or fishing sectors do not have access to sensible opportunities in respect these areas.
I have not studied the an bord snip nua report in full and neither do I intend to become carried away with regard to its contents. However, there is another body which operates in Deputy Christy O'Sullivan's constituency but the work of which appears to be giving rise to impediments. Members received an e-mail from a person who did an interview with this body in recent times. What happened in that instance beggars belief.
I was part of a delegation from the Joint Committee on Communications, Energy and Natural Resources which visited the Loughs Agency in Derry last week. I was extremely impressed by that agency's modern outlook, efficiency, good practices and the enthusiastic way in which it goes about its business. I was also impressed with regard to the level of support it receives.
Some of the controls that are currently in place——
What about charges?
It is unfortunate that there are charges. However, as Deputy Creed is aware, there is no such thing as a free lunch. I am of the view that there is a role for a reinvigorated, and perhaps slimmed down, BIM to play in the future.
Deputy Christy O'Sullivan has indicated that he wishes to intervene. As the Deputy has already contributed, he should confine himself to asking a supplementary question.
I indicated earlier that I wish to contribute again. If, however, our guests wish to reply to the questions already posed, that is fine.
The Deputy may pose supplementary questions following Mr. Whooley's reply.
Mr. Jason Whooley
Members referred to quite a number of issues. I will try to deal with them in groups in my reply. When we were preparing for this meeting, the report of an bord snip nua was not on the agenda. However, I understand the reason behind its dominating many of the contributions made by members. If possible, I will deal with that matter first and respond to some of the specific questions relating to the report.
BIM had no consultation whatsoever with the special group on public service numbers and expenditure programmes. We are unsure with regard to from where some of the figures contained in the report come. I refer, in particular, to those relating to BIM's staff. Like most agencies, in preparation for an bord snip nua's activities, in January BIM completed a standard, template form in respect of its number of employees, etc. We made no other contribution to the work of an bord snip nua.
We are aware of the economic climate that currently obtains and neither the fishing industry nor BIM can remain immune from cuts, regardless of whether these relate to budgets or personnel. We would welcome the opportunity to engage in a rational discussion and debate with regard to the functions of the organisation, the role it currently plays and its future direction. We would be happy to discuss efficiencies we have introduced to date and to have someone examine these.
With regard to the figure of €7.3 million in the report and whether this relates to overheads, a footnote at the bottom of page 5 indicates that this money is comprised of €500,000, which could be made in savings as a result of the closure of the ice plants, and a further €6.8 million, which would come about on foot of a 20% saving on the €34 million in financial support provided by BIM to the fishing industry in 2007. We have not received clarification in respect of this matter. However, my interpretation of it is that €6.8 million of the €7.3 million in savings to be made will come about as a result of a reduction in financial support to the seafood sector and not in the form of savings in overheads resulting from the abolition of Bord Iascaigh Mhara.
Questions were raised about staffing, strategy and how we will move forward. We are very clear as to how we see the industry moving forward and we have identified five key areas that form the basis of our strategy for the future. The reduction in staff numbers from 173 last August to 140 currently was outside our control to an extent with the ban on recruitment and on the continuation of contract services restricting our numbers.
Does that include contract staff?
Mr. Jason Whooley
The reduction includes people on shorter than four-year contracts. However, the remaining staff in the organisation are focusing on the five key areas. We are reskilling and re-profiling positions internally and we have a flexible and co-operative staff who are prepared to upskill or change their existing roles to meet the demands of the seafood sector moving forward.
We have no ambition to build empires or profiles. We are completely dedicated to driving forward the future of the seafood sector and we absolutely passionately believe that future exists. The organisation we are restructuring and building is capable of delivering on that potential. That will not happen without difficult decisions for us as an organisation and for the sector but we are prepared to take them. We are completely open to any investigation or debate, financial or otherwise, on our operation. We have financial people from multinationals and private sector workers have joined the organisation. We consider ourselves to be outside the traditional quango painted by much of the recent negative publicity.
I agree with Deputy Ferris. We do not have our heads in the sand nor do we have a rose tinted view of the world. It is a difficult sector but the fundamentals are sound. It is widely recognised we have the most productive waters in Europe, including in legal terms through the European Commission. Equally, despite difficult trading conditions, there is huge demand for seafood. The Food and Agriculture Organisation of the United Nations has identified that with the world's population expanding, an additional 30 million tonnes will be needed over the next 15 years to satisfy demand. That seafood will have to be produced somewhere and Ireland is well positioned to deliver it.
BIM does not have a function in administering quota. We do not have a formal role in negotiations in Brussels to deliver additional quota or in allocating quota in Ireland. Our role relates to developmental policy for the seafood sector. In addressing the profitability of the sector, there are three key issues. The first is differentiation whereby we make sure Irish products are differentiated from imported products, be it on the domestic, European or global markets. Next Friday, the Minister of State, Deputy Killeen, will launch the BIM quality seafood programme in Galway, which will provide a platform for all Irish seafood products to be differentiated in the marketplace. We will encourage as many industry participants as possible to get involved. It is a hugely significant move for consumers and trade buyers to be able to identify Irish seafood products in the marketplace.
The second element of profitability is innovation. A total of 85% of what we produce is exported or sold on the hoof. The opportunity that exists is to increase the value of products sent to the marketplace. As was the case with agriculture 25 years ago, there is considerable room for adding value to our products.
The innovation centre in Deputy O'Sullivan's town of Clonakilty is a state of the art incubation centre for seafood. Responsibility for seafood has fallen between different agencies and third level institutions. The facility in Clonakilty, when it is operational in September, will have tremendous potential to deliver added value. If we can achieve even a 10% added value to seafood products, we will generate an extra €34 million per annum.
Deputy Doyle referred to the route to market. Of the 200 Irish seafood companies, 100 are turning over less than €1 million. In most European markets we have between 1% and 4% of market share. We do not have companies of the scale to compete in the European marketplace. Furthermore, those companies which are competing are competing against one another. We are currently working with a number of organisations to achieve, at least, greater co-operation in how we address the market, if not consolidation. There are examples in other sectors of how this can be done.
This is a very traditional sector. It needs a focused entity working with it which can take its potential forward. We passionately believe we are that organisation and we are working towards that. Deputy Creed mentioned our regional office in Listowel. That office is a one man band. It is staffed by an aquaculture development person who looks after Castlemaine and the Clare coast.
We have strong levels of co-operation with other agencies. We would like to avoid complete duplication of functions. We recently signed a memorandum of understanding with Bord Bia and we have maintained our very good working relationship since the transfer of the export promotion and marketing function to it. We administer aquaculture schemes jointly with Údarás na Gaeltachta, and processing schemes jointly with Údarás na Gaeltachta and Enterprise Ireland. We have a clear delineation of clients. Can it be improved upon? Of course it can. Are we saying we are doing everything perfectly? Far from it. However, we are not standing back and waiting for things to happen. We have been aggressive in the pursuit of our strategy.
My colleague, Mr. Donal Maguire, will deal with the aquaculture side and the question of potential, which was raised by a number of members. I will be happy to return to any issue members feel I have not dealt with adequately.
Mr. Donal Maguire
Ireland has led the way in the development of organic status farmed salmon. It started from a salmon farm based off Clare Island in County Mayo. Since then, the proportion of Irish farmed salmon which attracts organic status has grown, to the point where between 70% and 80% of our output is classified as organic. The reason is that it fetches a much higher price. The differential is in the order of 30%. The production cost is somewhat higher but it is well worth it.
Bord Iascaigh Mhara has promoted this and helped to develop standards because it is difficult for a small industry like ours to compete, in production terms, with our colleagues in Norway or Scotland. Last year, we produced approximately 10,000 tonnes of farmed salmon. This year we hope to produce about 11,500 tonnes. While that sounds like a lot of salmon, our Norwegian colleagues produce 770,000 tonnes. We are not even a slow week in Norway. Our colleagues in Scotland produce about 170,000 tonnes per annum.
We all started at the same time. Their industries have gone much further than ours. Ours, while small, is highly valued. It is important that we stay ahead on this. Given the high price differential, the Scots have started to produce some organic standard fish, although it is still about half the volume we do. The Norwegians are looking at it, attracted by the big price differential. We have to stay ahead of the game.
We are now moving into eco-standard or eco-friendly produced fish which our market research tells us will be the next big thing in the market place. We want to keep first-mover advantage on that. There is no doubt there is tremendous potential in the aquaculture industry sector. Independently from BIM's own estimates the Marine Institute stated in its forward-looking scenario that this is technically quite feasible. The resource and the market is available to increase output over the next five years by something in the region of 40,000 to 50,000 tonnes. For every 70 tonnes of primary production of aquaculture a full-time equivalent job is created and this in turn generates another 1.26 jobs in the community around it. This development would be a very good source of primary employment. This is set against a world stage where, as Mr. Whooley said, the FAO, the fisheries organisation of the United Nations, has shown that by 2025, a total of 30 million tonnes extra of seafood will be required and Ireland needs to take its share of that market. Currently increases in aquaculture output all around the European Union are relatively static for all sorts of reasons, including probably the misapplication of environmental legislation, and instead imports are the substitutes. Up to now we have been able to afford to buy-in fish and we have been sacrificing our own ability to create jobs and wealth and employment at the expense of simply buying it in. Now that the economic crisis is upon us this is no longer a viable option. From an environmental point of view it is a bad idea because these fish are being produced in countries which do not have the same environmental controls as the European Union and this will eventually come home to roost. For all kinds of reasons we need to unblock the difficulties in the system and get our aquaculture sector up and running to fulfil its potential.
What is the difference between eco-friendly fish and organic fish?
Mr. Donal Maguire
There is a difference in that organic status can only apply to farm fish; one cannot have an organic product from a wild source but only from a farmed source. We know there is concern in the market place about how fish are farmed or how they are caught. An environmental management can be attached to a production system and from that comes an eco-label. It is another form of catering to the market for people who are worried about eco-production.
Mr. Michael Keatinge
I will address a couple of the issues that have been raised with regard to the sea-fishing sector and in particular a number of points that have been raised about quota. This is a perennial problem we have faced ever since the early 1980s when quotas were originally set. One of the roles of Bord Iascaigh Mhara is to support our parent Department, whichever that might be at any time, in advancing Ireland's share of the quota. It is a difficult area. It is not within our gift at board level but one of the things we recognised some years ago — perhaps ten years' ago — was that the inshore sector of our sea-fisheries is largely within our national control and it accounts for approximately one third of the value of our landings. The sector has been the unsung hero of the fishing sector to some extent. For instance, of the 2,000 fishing vessels on the BIM register, from the small currach right up to the very large supertrawler, more than 1,600 are smaller than 30 ft long and they employ one or two men at a time and they are spread in every nook and cranny around the coast. They fish species like crab, lobster and shrimp, which are critical stocks. We have a great opportunity to manage those properly. BIM has recognised that sector and we have been working with the sector. For example, a Deputy referred to ice plants. Unlike the larger vessels who can now fit their own ice plants on board — and BIM has given grant aid assistance to fit them and making them largely independent of the traditional network we operated — outside the key centres such as Howth or Dingle, Killybegs or even Kinsale, small operators will not have an ice plant. For instance, for a small operator of a currach out the back of the Aran Islands, having some access to ice is critical for the quality of the product. We have been trying to address that by creating a mini-network of small ice plants locally owned and operated. One can address large issues in novel ways. Simply closing down is not always the best answer. An orderly hand-over or exchange to a different system may often be the right way. It is certainly one that we would advocate.
I am focusing on areas outside those recognised as the traditional centres. In that overall context, it is worth focusing on the range of services we try to bring to the dispersed community. There has been a tendency to focus on places like Killybegs, Howth, Dunmore East, Dingle and Castletownbere. Our network of people on the coast is working with the industry in areas like improving their handling and quality and their ability to represent their own interests. We are putting in place a network of local advisory committees to try to create a consensus within communities on how stocks should be managed. That consensus should not be simply within the domain of fishermen — it should take tourism and environmental issues, etc., on board. That type of bottom-up management is hugely important. I have raised these issues because it is important for us to recognise that the best approach for the future of the industry does not necessarily involve focusing solely on the system of relative stability that derives from Brussels and dictates our quotas. I accept that the system in question would be difficult to change. We have to recognise that we can do a great deal for the huge additional industry that exists. We certainly recognise that.
I wish to respond to the point a number of members made about fish prices. We recognise that demand for certain high-end or high-value goods, such as lobster, has decreased now that money is not as flush in this country. That is reflected to some extent in the price collapse in a number of areas. We recognise that cod remains a preferred food for the Irish palate. Like many parts of southern Europe, this country is having problems with cod that are making it difficult to satisfy local demand. The cold waters of the most northern parts of Europe, which have not had the same temperature rises as more southern areas, are still producing cod at a very high level. As a result, imports have become a serious problem. At present, somebody catching a cod in Irish waters does not have a way of differentiating that cod on the market. I would like to bring the challenge we have looked at to the attention of all members of the committee. The next time they are in a restaurant, they should ask whether they have any way of knowing whether the cod, haddock or whiting they are eating is Irish. Similarly, when one goes to the supermarket, does one have any way of knowing whether the fish is Irish?
A year ago, we took on board the challenge of trying to create a national brand. When we stood back, we realised it is not simply a case of slapping a label on something. We could do that tomorrow — we could get an old printer to produce rolls of labels and put them on. That was not really the issue. The real issue is the creation of a brand for the Irish industry that is unashamedly a national brand. We need to bear in mind that as a State agency, we cannot use public money to promote Ireland. The industry must be helped to do that for itself. We need to give it two critical attributes. When Irish consumers encounter a brand like Bord Iascaigh Mhara, they expect top-quality fresh and tasty fish that have been fished responsibly. We have spent a year working with the industry. We have decided that if we are to use brand like Bord Iascaigh Mhara, which is 57 years old and has huge credibility, we should do it properly. On Friday, we are launching a true attempt to address that. We cannot change the fact that people might still opt to buy the cheaper import. We have to give them a choice, however. We are trying to bring a full range of services to the industry. To my mind, that is the critical issue in this context. It is not simply a case of throwing a brand at somebody. It is a question of thinking it through, bringing all the necessary skills and talents together, acting as a focus for an industry that is undergoing change and using money wisely to bring that concept through to the end consumer.
I would like to mention some minor issues that I did not get a chance to raise earlier. Perhaps someone will say something about the new products that are being developed in Clonakilty at the moment. How many of them are in place? Is there much activity in relation to that? What is the potential for salmon to be farmed organically without it having any effect on the price? What is our main market for organic farmed salmon?
There is considerable potential in the new enterprise of abalone farming and other areas. This has not even been discussed at this committee. There is a great opportunity for further development.
This committee should indicate strongly to the Minister that it will not stand by and watch as BIM is subsumed into the Department of Agriculture, Fisheries and Food.
The Minister has not suggested that.
We will pre-empt his doing so.
It is only a report.
We will pre-empt it at this committee meeting. I call on the Chairman to invite Mr. Cawley and the senior officials in the Department to a meeting so we can be apprised of their position on the seafood industry.
With regard to inter-agency co-operation and the McCarthy report, it seemed to me as if the real winner by a country mile was Enterprise Ireland. Everything and anything is being thrown at Enterprise Ireland. It has been stated at this committee that Enterprise Ireland has practically been disgraceful in regard to the indigenous food industry. There are concerns over its track record in that respect. What is the current level of co-operation and consultation pertaining to Enterprise Ireland? What is the level pertaining to Teagasc? What are the delegates comments on the expenditure involved in establishing a brand, bearing in mind the recommendation to abolish BIM?
Will the delegates update the members on decentralisation from Dún Laoghaire to Clonakilty? How many staff will be based in Clonakilty and what will happen to the operation in Dún Laoghaire? What are the impediments to decentralising quickly?
I agree with Mr. Michael Keatinge on cod in the supermarkets and the Irish branding, in respect of which the Minister is inaugurating a scheme next month. It is not before time because there is a lot of cod being imported from Iceland, Norway and other countries. It is coming through Cork Airport, which is now almost the biggest fish landing port in the country.
On a lighter note, in 1983 BIM sought three representatives from the Dáil, one from Fianna Fáil, one from the Labour Party and one from Fine Gael. I had been a Member for two years at the time and also a member of Fine Gael. I was picked by BIM in addition to John Wilson from Cavan – may the Lord have mercy on him – and Mr. Barry Desmond from the Labour Party. We were put on a fish diet for 30 days——
Go easy.
——to promote the interests of Bord Fáilte and the quality of fish.
The Deputy was still eating.
Give me time. Do not rush me too much.
Allow Deputy Sheehan to continue.
We were on the diet for 28 days. The Dáil was supplied a fish ration to give to us every day. When we went home on a Thursday evening, we were given fish for Friday, Saturday, Sunday and Monday until we returned on Tuesday. This was supplied for free for 30 days.
It nearly broke the board.
I won the competition. I lost 21 lbs in 30 days. Before we started the competition, I asked whether I could have a gin and tonic every day.
Bombay blue gin.
I was told "Not every day", so I told them that I would only drink on Sunday, but that I would have seven Bombay blues. To make a long story short, I won first prize, a beautiful Waterford Glass decanter.
Full of gin.
John Wilson, Lord rest his soul, lost 18 lbs and Barry Desmond lost ten lbs. That 1983 exercise on the value of eating fish was well publicised by An Bord Iasca Mharaigh.
It was a part of the advertising campaign.
They were having more gins than——
Deputy Sheehan did not need to go to a gym either.
We will let the gentlemen answer the questions. They should not comment on the free fish in 1983.
Mr. Jason Whooley
I thank the Chairman. To make a quick comment on Deputy Sheehan's stories, it is widely recognised that fish is probably one of the healthiest foods. He has sown the seed of a promotional campaign.
Regarding specific issues, Deputy Christy O'Sullivan asked about Clonakilty and new products. The facility will be up and running by the middle of September. We are working closely with Enterprise Ireland on a business planning process with ten of the country's major seafood companies. There is an absence of business planning in the sector, but we are trying to change that situation. Alongside Enterprise Ireland, we will work with companies to address their internal deficiencies of which they may not be aware. For example, we will address new product development. As a direct output of this programme, ten companies will be recruited during the coming weeks. We expect the facility to deliver a minimum of ten new products from the original ten companies. A team will be in place by the middle of September. There is considerable potential. It goes without saying that there is scope where one exports and sells such a significant amount of product on the hoof.
Abalone farming is new to Ireland. We conducted a feasibility study with the promoter involved to determine the possibilities. The markets for abalone in Japan and the Far East are large. On the strength of the feasibility study, we grant-aided the promoter to establish what could be one of the best abalone farming facilities in Europe. It applies new and innovative techniques to a traditional sector. The promoter is an ex-fisherman.
Opportunities exist and with abalone, perch and char there is scope to expand. It is not a straightforward opportunity. As with any start-up there are difficulties. As an agency we believe we can offer those start-ups the obvious business development access and the technology transfer which we spoke about and we can apply the innovative solutions that will be required in the current climate. As far as our organisation is concerned innovation is not a blue sky concept. BIM's definition of innovation is "getting new things done" and this is what we are about as an organisation. We are trying to help the sector through these difficult times by getting new things done.
With regard to the construction and cost of a brand the BIM brand is well known in Europe. It has been in existence since 1952 and as many members recognise it is a well-known brand in Ireland. The construction of a brand and getting a consumer to recognise a brand in simple marketing terms is a monumental task in this day and age. It costs tens of millions of euro for companies to get consumer recognition for their products. This can only happen with a vast amount of money or over a considerable period of time. Without a vast amount of money BIM has built up a recognisable brand over the past 57 years and that cannot be replicated overnight.
BIM is to decentralise its head office as part of the Government's decentralisation programme announced in December 2003. The facility for the new headquarters is based in Clonakilty and the final elements are being put together on the building as we speak. It will be ready for occupation in September. Decentralisation is a voluntary scheme for the staff involved. We expect to have 20 staff in Clonakilty by year end and we will increase that number over a phased period provided that we are still in existence.
How many are in Dún Laoghaire?
Mr. Jason Whooley
When the decentralisation scheme was announced we had 173 staff; we now have 140 staff with potential for further reductions. The number available for decentralisation from head office in Dún Laoghaire was 95 when the decentralisation scheme was announced; at present it is down to approximately 80. The implications of a reduced staffing number in the organisation has consequential implications for the amount of people we will have available to transfer to Clonakilty. Having said that, I emphasise that under the decentralisation scheme the one-stop shop concept in Clonakilty also provides for accommodation for the Department and there will be approximately 100 officials there and also 50 Sea-Fisheries Protection Authority staff in the same building. By year end there will also be 20 BIM staff there.
As we alluded to earlier, of critical importance in that facility is the development of the seafood development centre, a state-of-the-art centre for value-added product development in the seafood sector that heretofore did not exist. While there are widely recognised industrial relations difficulties with the transfer of staff, equally the facility is more than a decentralised headquarters for BIM. It is very much a one-stop shop for industry with significant potential for increased added value for the sector that will help us to improve the profitability of the sector.
We believe organic salmon has considerable potential. At present our production is only approximately 10,000 tonnes. Even though, as Mr. Maguire highlighted, there is a premium on the price of approximately 30% or 40% over traditional salmon we believe that there is significant scope to increase organic salmon production by 5,000 tonnes without any implications for the price or the market. The main market about which the Deputy inquired is Germany. There are very few sectors in the economy that we can state offer such a market opportunity. It is a question of us getting our production right.
Is it agreed that we refer the concerns expressed by the members to the Minister? Agreed. Is it agreed that we invite Dr. Cawley and departmental officials to appear before the committee, as suggested by Deputy Sheahan? Agreed.
We will have the people mentioned before us in due course to discuss the Common Fisheries Policy. Rather than having separate meetings, perhaps we could deal with both issues at the one meeting.
On behalf of the joint committee, I thank Mr. Whooley and his colleagues for their presentation and answering the questions raised.