The main objects of this Bill are to regulate the manufacture of bacon, control the supply of pigs to bacon factories for conversion into bacon and, finally, to provide a method of fixing the price to be paid for bacon pigs to producers. The Bill in its essentials follows the recommendations of the Pig Industries Tribunal which reported in December, 1933. The Bill does not provide for regulating the number of bacon pigs to be produced. The adoption of the system of regulating imports of pig products into Great Britain by quotas has had its reflections, not only on the producer of pigs in Great Britain, but also on the producer of pigs in countries which customarily supply bacon to Great Britain, such as Holland, Denmark and Saorstát Eireann. In Great Britain a certain portion of the home market has been set aside for the home producer, and the filling of that portion of the home market by home production has necessitated the putting in force of elaborate contract schemes between producers and bacon factories in co-operation with a Pigs Marketing Board established by legislation. In Holland and Denmark schemes have been adopted which aim at restricting the production of pigs to a number sufficient to meet the home requirements and export requirements. The Dutch and Danish schemes, though differing in many details, reduce themselves practically to schemes of registration of producers, with limitations on the number of pigs which any one producer may produce.
This Bill does not provide for the registration of producers. It is hoped that in future supplies of bacon pigs produced in this country will be restricted as a result of the Bill to such as can either be used at home or can be readily sold on an export market. It will be obvious that any scheme of registration of pig producers in this country would present far greater difficulty than as compared with Great Britain, for the reason that the vast majority of our producers are small producers and an immense task would, therefore, be involved in registering each of those producers and in assigning to each a definite number of pigs to be produced. While it is difficult enough in practice to deal with producers whose production runs into hundreds per year, it is still more difficult to deal with the small producer who might produce only six, seven or eight pigs in the year. It is hoped that the provisions as regards the fixing of prices and for the determination of the number of pigs to be sold for bacon will sufficiently restrict the production of bacon pigs and that it will not be necessary to devise any scheme of restriction on the producer such as there is under the Dutch and Danish schemes. If, however, the Bill fails in this one of its objects, the question of devising some sort of registration and restriction scheme will arise. If the Bill fails in achieving its object in that way it will be necessary to examine the possibility of limiting production by the producer. I want to make that point very clear, because a good deal of discussion arose in the Dáil which I think might have been avoided if Deputies had understood the principle underlying the Bill. It is not contemplated in this Bill to depart from the old principle of prices being regulated by supply and demand. It is hoped, however, to improve conditions in other ways, but I want that point to be clearly understood. If we are to regulate prices on another basis, that is, on the basis of the cost of feeding stuffs, labour and so on, we would have to proceed on a different line and we would certainly have to come down to the producer and tell each producer in the country the number of pigs he would be allowed to produce in the year.
The adoption of the quota system in Great Britain is not the only or the most important reason for the Bill. Senators are quite aware of the great fluctuations that have occurred in pig prices for many years even before the quota system came into operation in Great Britain. It is understandable, perhaps, that there should be a fluctuation in price from one season as compared with another because, if we have more pigs produced in the autumn season—as we have—the curers must lower the price of bacon in order to get the bacon consumed, and it is quite easy to see that pigs must be cheaper during the autumn season than during the rest of the year for that reason. There seems, however, to be no good reason why pigs should vary in price from day to day or even vary in price during the same day, as is frequently the case. I did not take the opportunity of looking at the prices of pigs in to-day's papers, but when introducing the Second Reading of this Bill in the Dáil, I pointed out to the members of the Dáil that on that very day, according to the newspaper reports, different prices were being offered for pigs at different factories, and the position on that day was that if a farmer had two 12 cwt. pigs he could get 24/- more from one factory than the other. If he had sent one pig to one factory and the second pig to the other factory, he would have got 24/- more for one pig than for the other. That is a position that ought to be remedied, in my opinion, because, obviously, the producer is not getting all that he is entitled to get from one of those factories. It is hoped that the powers now proposed for the fixing of prices will result in a greater uniformity of production, and, more important still, in uniformity of prices; in other wards, that the production of pigs for bacon will tend to equalise itself over the 12 months and that prices will not vary more than in accordance with seasonal changes in the cost of producing pigs.
The first part of the Bill is merely introductory, and I take it that does not require any detailed explanation from me. The second part deals with the licensing of bacon factories and with the regulation of the manufacture of bacon, its making, packing, carriage, etc. I do not think I need detain the Seanad with lengthy explanations of the provisions relating to the latter items. The provisions of the Bill, in this respect, follow closely on the lines of the corresponding provisions of the Fresh Meat Act of 1930, with the exception that that Act dealt with fresh meat for export while this Bill deals with bacon whether to be exported or consumed at home. Powers are taken to inspect pigs both ante and post mortem, to inspect the finished bacon and to prescribe, by regulations, methods of marking, packing, conveyance, etc. The provisions as to licensing of factories differ, however, considerably from the corresponding provisions of the Fresh Meat Act. It will be noticed that provision is made for three things— the registration of pork butchers, the registration of minor curers, and the licensing of bacon factories.
Pork butchers, in the ordinary conduct of their business, find it necessary from time to time to manufacture into bacon certain portions of carcases which they are unable to dispose of as fresh pork. It would be obviously unfair, in view of the restrictions on the manufacture of bacon imposed on licensees, to allow pork butchers to manufacture bacon without restriction or without some control. Accordingly, the Bill provides for the registration of all pork butchers and restricts any one pork butcher to the production in any one year of bacon from not more than 15 per cent. of the pigs used by him in the course of his business, subject to an over-riding maximum of 400 cwts. of bacon. The pork butcher is also required to pay to the Minister a fee at the rate of 2/- per cwt. for every cwt. of bacon manufactured by him. Otherwise, he would have an advantage over the bacon factory, because the bacon curer has to pay certain fees under this Bill. Apart from these two points the pork butcher is not affected by the Bill. The pork butcher who does not manufacture any bacon need not be registered and, of course, pays no fee. Neither is there any restriction on a new pork butcher going into business. A new pork butcher who goes into business after the passing of the Act need be registered only if he intends to manufacture portion of the pork handled by him into bacon.
The question of the minor curer is one which has given a considerable amount of difficulty. I think it has given more difficulty in the drawing up of this Bill than any other problem. There is always a difficulty in drawing the line between what might be regarded as the genuine people in the trade and those who are not in the trade. Bacon is at present cured and sold by many persons whose facilities for turning out a high-class article are inadequate. Many of these persons manufacture bacon only when conditions in the industry are favourable, that is, when prices of pigs are low. Many manufacture only at seasons of the year. Obviously, it is not desirable to have in the industry persons who cannot turn out a satisfactory article or those whose entry into the business is spasmodic. A limit had, therefore, to be devised. The limit adopted in the Bill is the production of 2,200 cwts. of bacon during eight months of the year ended 30th April last. Any person who has produced this quantity of bacon is entitled, subject to his premises and plant being found satisfactory, to be licensed, but anyone below the limit can be registered as a minor curer, no matter how small the quantity of bacon produced, provided the production has been spread over eight months of the twelve. If production has not been spread over eight months, the curer can neither be licensed nor registered; in other words, he does not come under the Bill. Provision is made for registration to last for two years. Once a person becomes registered as a minor curer he is entitled to carry on for two years under that registration. If he remains in production for 45 weeks of each year, if he produces more than 1,500 cwts. of bacon during the first year and more than 2,200 cwts. in the second year, he is entitled to be licensed and to become a curer at the end of the two years. If he does not fulfil these conditions, he goes out of business at the end of the two years.
The figure of 2,200 cwts. was adopted as the minimum at which a curer could afford to remain in the business of curing bacon eventually. He will then become subject to the requirements of the Bill in regard to premises, equipment, methods of manufacture and so on, and, possibly, unless his premises are suitable, he may have to incur some capital expenditure. The portion of the Bill relating to minor curers was very fully discussed during the course of its progress through the Dáil, where I found myself able to make some concessions as regards minor curers, as compared with how the Bill stood originally.
Part III of the Bill is concerned with the establishment of the Bacon Marketing Board, which will consist of seven members with a chairman nominated by the Minister. The members of the Board are to be elected by the curers, who, for the purpose of election, are divided into three classes— large, medium, and small curers. They will elect these seven members on three different panels. In that way every curer has direct and, I think I might say, adequate representation on the Board. The first Board will hold office until 31st December, 1936, and the second and subsequent Boards will hold office for a two-years period.
The duties of the Bacon Marketing Board are to be confined entirely to matters which affect the curers' end of the bacon industry. That is another point on which perhaps we might save some discussion if Senators realise that that Board will have nothing to do with the production or even the price of pigs. There is a tendency to accuse the Government—whatever Government it might be—of being more inclined to look after the interests of business people rather than the producers. This Board will be composed entirely of curers and will have nothing whatever to do with any business outside the curing business, and therefore I think no fault can be found with the Board as being composed entirely of curers.
The duties of the Board are to allot the quantity of pigs available for disposal amongst the curers, and that is the principal duty they have to perform. They also have the duty, under the Bill as it stands, of deciding the number of pigs that should be disposed of by the factories as a whole, but I intend to ask the Seanad to adopt an amendment on that point which will give the Pigs Marketing Board some say in that matter also. They will, of course, take into consideration in allotting these pigs amongst the various factories the output of each curer during the year 1934. In other words, it will not be possible for these seven members, no matter how much inclined they may be towards their own interests, to allot all the pigs in the country between themselves. They must take into consideration the killings of each factory in the year 1934. Then, of course, they have the power to deal, by penalty, with cases of under-production and over-production, so that each curer will be compelled to take the number of pigs allotted to him, no more and no less, with, of course, a certain tolerance. It would be perhaps absolutely impossible to take the exact number allotted, and, therefore, they can go up or down by five per cent., but beyond that there is a penalty. They have also power to arrange for the cold storage of bacon, if necessary. For the last two years, for instance, they co-operated with the Department of Agriculture as to the cold storage of bacon, and it is in their interests, just as much as the interests of anybody else, and they are the proper people to deal with the question of cold storage where there may be a surplus of bacon, as there usually is, before Christmas, and a shortage of bacon might be expected after Christmas.
There was some anxiety expressed, in the Dáil especially, on the point that the Bacon Marketing Board might not on all occasions allocate amongst the curers a sufficient number of pigs to meet the probable demand for bacon. It appears to me that under the price arrangement, to be dealt with later, it will be to the advantage of the Bacon Marketing Board to allocate amongst curers as many pigs as they think can be disposed of as bacon. I do not know if any Senator could suggest any reason why bacon curers themselves should not be anxious to deal with all the pigs they can possibly deal with, taking into consideration the possibilities of the bacon market and other relevant considerations. I do not think there is any ground for the fear expressed in that respect. However, with a view to meeting the point of view expressed in the Dáil, I propose to ask the Seanad to adopt an amendment requiring the Bacon Marketing Board to take into account any representations made to them by the Pigs Marketing Board, because on the Pigs Marketing Board there will be representatives of the producers. Apart from that, Senators will see from the Bill that three members of the Bacon Marketing Board will also be members of the Pigs Marketing Board, so that anything that is discussed at the Pigs Marketing Board is very likely to be brought up at the Bacon Marketing Board by the representatives of that board who attend the Pigs Marketing Board; and it is not likely that any views expressed by the Pigs Marketing Board will be left unnoticed by the Bacon Marketing Board.
I want to mention also a feature which is common both to the Bacon Marketing Board and the Pigs Marketing Board. In view of the duties which each board will have to discharge, it is essential that both boards shall on all occasions be kept up to full strength. Accordingly, the Bill provides for the election of substitutive members as well as the members who take their seats. If, for instance, the large curers had two representatives, and if these two were absent through illness, or for some other reason, when the allocations were being made, and if, by any chance, the medium and the small curers felt some resentment against the large curers, they might take a little bit off them and allocate it amongst themselves. It would, of course, be rather unfortunate that such a thing should occur. I am only giving that as an instance. Other instances, perhaps, could show as good a case in the event of the small curers being absent. At any rate, I think Senators will see the necessity of having every interest fully represented at every meeting, and if a member is absent through illness it is well to have provision made for a substitutive member to be present and that is provided for in respect of both of these boards. It is also provided in regard to the substitutive members that if, say, a representative of the medium curers or the large curers is absent, that a substitutive member from that particular panel, if available, shall be nominated by the Minister to take his place.
Exceptional powers are also conferred on the chairman of the Bacon Marketing Board to decide certain matters as to which the board do not reach unanimity. The most important of these matters are the general allocation of pigs for curing and the allocations amongst the different curers. That is a particular point on which I had to call the curers together to decide, because it struck me when drawing up the Bill that, if a majority decision were to carry, it is quite possible that, say, the medium and large curers might combine and say: "Let us weed out the small curers by giving them small allocations and gradually finish them"; or, alternatively, the medium and the small curers might combine to have a majority on the board against the large curers and decide to bring the large curers down to be medium curers. It was a very difficult point, and I had every curer in the country present at the meeting and they unanimously agreed that, unless a decision was unanimous about the allocations, the chairman should have a veto and should have the power to decide on the allocations himself. He has not a complete veto on decisions. If they are unanimous, the decision goes; but if they are not unanimous, if there is any minority against a decision, then the chairman has a veto and takes the allocation into his own hands.
Part IV deals with the Pigs Marketing Board. The Board will consist of six members and an independent chairman. Three members will represent the producers' interests, and at the outset will be nominated by the Minister. There is provision either for election or for the submission of a panel to the Minister, should any organisation arise before the next election takes place, for 1937-8. Three members will be elected by the Bacon Marketing Board. The Minister will appoint the chairman, so that it will consist of the chairman, three members of the Bacon Marketing Board and three representing producers, who, in the first instance, will be nominated by the Minister. With a view to enabling the Board to fix a price for pigs which may endure for a reasonable length, the Board is empowered to fix two prices from time to time, namely, the appointed price and the hypothetical price. The appointed price is the one that the curers will actually pay for pigs to the producer, while the hypothetical price may be taken as the price which the Board considers a curer should pay in the circumstances if he wants to run the business in a paying way. If he pays less to producers than he might pay under the hypothetical price fixed, then he may be making more profit than he should, and the Board will have a certain amount of power to take these profits. If he is losing, that is if the hypothetical price is lower than he is actually paying, the Board is empowered to pay out a certain amount for pigs that he purchased. In that way, even though in ordinary circumstances the price of bacon in the home and in the foreign market may change, and that a change might be justified from week to week or from month to month, it will be possible for the Board to get the same price over a period for producers. They leave the appointed price, but change the hypothetical price according to the changes in the bacon market. As soon as the Board gets some experience of the work it will be able to have long periods of fixed prices. In fact, from experience that we have had of pigs and bacon during the last two or three years, it should be possible to have practically a fixed price for the first nine months of the year. Perhaps for the last three months there are different conditions. That might be too much to expect from the Board for some time, but eventually it should reach that stage.
They also have power under this Bill to appoint a different hypothetical price for pigs for export from that for pigs for consumption at home. It is put that way in the Bill, and Senators will realise that what will happen is that it will be taken on a percentage basis. If the appointed price were say 56/- and the hypothetical price 60/-, the curer would pay 4/- to the Board. Assuming that the export price of bacon was 2/- less than the home price, the curer who exported exactly half his output would get back 2/- more per cwt. on his export trade than he would on his home. If the home price were worse than the export price, he would get more for his home trade than for his export. There would be a serious injustice unless the Board got that power, because the bounty on exports and the excise levy on pigs have to be changed from time to time in an endeavour to keep the person exporting on as good a basis as the person selling at home. It is rather more difficult to do that in present circumstances, particularly owing to the change in the excise levy, but the Board could meet every week if necessary and could make changes in price without any great trouble. They have to make an order which will be published in "Iris Oifigiúil." There will be no great trouble in doing that when they get started.
Prices will be fixed on a weight basis. All pigs purchased by licensed curers must be purchased on the basis of weight. Where weighing facilities are not available, the Board by order may permit weight to be ascertained by agreement.
The Board have power to fix a freight allowance generally for the whole country, or different allowances for different areas, as well as a buying allowance, this being such sum as the Board considers fairly represents the curers' buying costs either at the factory or through an agent or the ordinary dealer who buys at the fairs and sells to the factory. I should say that ordinary dealers buying pigs at a fair are not bound to pay the fixed price at all. It is only the curer or the minor curer, as the case may be, who is bound to pay the fixed price. If an ordinary buyer of live pigs goes to a fair he can buy at the best price he can, but he is entitled to the fixed price from the curer or minor curer.
At first sight Senators may feel some apprehension that in that way we are likely to weaken the influence of the Bill on prices. I do not think that is the case. Farmers are much better acquainted with the marketing of pigs and they will know from the Press what they are entitled to get. I should say that they are all within easy reach of scales if necessary, and are not likely to sell pigs to a dealer unless they get as good a price as they would get from the factory, if they were sent direct. The factories will be there to take the pigs direct, if necessary. Curers will be entitled to deduct from the fixed price the freight allowance, buying allowance, the levy paid to the Minister for veterinary examination, the levy paid to the Pigs Marketing Board, weighing allowance, insurance, and tolls, if any. That looks a long list, but when added up does not come to a great deal.
In the case of pigs delivered by a producer to a factory, neither the freight allowance nor buying nor weighing allowances may be deducted. These are the biggest items. If a producer feels that the buying and freight allowances are too heavy he may have his pigs delivered to the factory, and in that way get full price, the only deduction being the levy paid to the Minister, the levy paid to the Pigs Marketing Board and insurance. These three items put together will not amount to more than 1/- at the maximum. I mentioned that the three members to represent producers at first will be nominated by the Minister. I introduced an amendment on the Report Stage in the Dáil providing for the election of these members by producers at a later stage. I feel that that is a very difficult point because we have not got any organisation here like the Beet Growers' Association. If there was such an association of pig producers there would be no such difficulty, because we could have three members nominated by that association. We have not got such a body. In Great Britain they have a Farmers' Union which is representative of the industry. We have not got that here.
It is suggested that county committees of agriculture might do something in that way. It is provided in the amendment I speak of, which is now in the Bill, that, if any organisation is built up within the next year or so, the Minister will be empowered, if he does not think it is altogether representative, to take nominations from that organisation and from county committees of agriculture and from those select three. If, on the other hand, he is satisfied that the organisation fully represents the industry, then he may make an order providing for the election of the three representatives from that organisation.
Power is also given to the Pigs Marketing Board to purchase and dispose of pigs during a period when there is a surplus. It is felt that a provision of this kind might provide a useful outlet in certain contingencies. In these circumstances, the board may dispose of pigs, live or dead, or may have them manufactured into bacon, any losses incurred on such transactions to be met by the board out of its own fund. The board are empowered temporarily to borrow money to carry on their business, and the Minister is empowered to lend them money.
Again, the chairman of the Pigs Board is given special powers to decide certain matters as to which the board may not be unanimous. The most important of these matters is the price. It is quite obvious that, unless the board is unanimous, it is better that the chairman should decide the price. We have three producers and three curers on the board, so that there is likely to be a contest as to the price. It is probable that the producers will look for a higher price than the market would justify, and it is just as likely that the curers will look for a lower price than the market would justify. It is almost impossible to visualise agreement between the two parties, so that you would have three against three. If, for any reason, one or two representatives of one side were absent—if they were late in coming in or had to leave early then, although we have provided for substitutive members, it might be very unwise to allow a majority decision to operate. The Bill provides that, unless there is unanimity, the chairman will himself decide the price. The exceptional powers of the chairman and also of the chairman of the Bacon Board deal with matters in regard to which it is essential that the respective boards reach decisions. In other words, the Bill would break down if some decisions were not given. For instance, it is obvious that unless the Bacon Board made some allocation of bacon amongst the factories, the Bill would cease to operate. If, for any reason, the members of the Pigs Marketing Board decided to rebel, they might refuse to make an order, and thus render the Bill inoperative. For that reason, a decision by the chairman would be necessary.
As I stated at the beginning, the Bill follows, in the main, the recommendations of the Pig Industries Tribunal. The recommendations of that tribunal have, on the whole, met with the approval of the industry. When I speak of the industry, I mean both producers and curers. The scheme put up finally by an organisation of producers which gave evidence corresponded with the scheme put up by the curers as regards the formation of these boards, so that there was practical unanimity. We are following on those lines, with the exceptions I have mentioned. The people concerned in these exceptional cases were the curers, and where we departed from the recommendations, the curers unanimously agreed with the changes. It was easier to consult the curers on this Bill than it was to consult producers. It was comparatively easy to get all the curers together and quite easy to get a committee, whom they selected, to meet the officials of my Department and myself. On the other hand, it was not so easy to get representatives of the producers together but we had discussions with individual producers on many points.
The Bill represents a step towards the organisation of the bacon industry in this country. I think that this is the first attempt at organising the industry here and regulating production by individual factories. Organisation of the bacon industry has been found necessary in many countries. As I have mentioned, in Denmark and Holland and, I think I may add, Great Britain, organisation has gone much deeper than we have attempted. In those countries they have started to organise the industry from the production of the pig. It would be very difficult to do that in this country and this Bill attempts to avoid that issue as far as possible. However, it may be necessary to go back to that aspect of the problem. Having regard to the inconvenience which would be caused by any such scheme and to the undesirability of interfering with producers in that way, if it can be avoided, we think we ought to try this Bill out to see if it succeeds in getting a fair price for the producer and in getting the best name possible for our bacon both at home and on the foreign market. In that connection, I may mention that on the British market, where our bacon is in competition with the bacon of many countries, including the home-produced bacon in Great Britain, our bacon, as readers of the newspapers will have noticed, is improving in price. In certain places in Great Britain, in recent weeks, our bacon has been quoted at higher prices than even British home-produced bacon. Three or four years ago, our bacon was always a few shillings lower than British bacon on the British market. For some time now, our price has been as high as, and in some places higher than, the price of British home-produced bacon.
I might, perhaps, be permitted to say that when I asked some curers what was the reason for that they said it was entirely due to the home-grown cereals. However, perhaps the curers were overmodest, and that a good lot of it may be due to the curers themselves. In the course of my speech I mentioned that I proposed introducing a few amendments to the Bill during its passage through the Seanad. There are also a few minor amendments that it is not worth while dealing with now. What I have said covers, at any rate, the general provisions of the Bill.
