As I was saying, some two months ago we put this motion on the Order Paper of this House as we felt at the time—and still feel, in fact, that the situation in Irish agriculture was going to draw a lot of criticism and a lot of reaction from the farming community. Of course, we are right in that because as on this day there are meetings going on all over the country discussing this directive and discussing also directive 160, that is, the rearrangement of farms.
The Mansholt Plan as was originally enunciated was criticised throughout Europe because it was felt it would result in compelling vast numbers of farmers to leave their farms. This is also the impression in this country. However, Dr. Mansholt came here on a number of occasions and told us that his plan was greatly misunderstood and that it would, in fact, mean great benefits to farmers and enable the older farmers who own smallholdings to retire in dignity and with a standard of living which would enable them to live out their lives in comfort.
As time passed the Mansholt Plan was, as we are told, modified to such an extent that the EEC member countries accepted it. Indeed, they acclaimed it as being all that Dr. Mansholt originally claimed it to be as did our experts also. However, the schemes now prepared by our Departments of Agriculture and Fisheries and Lands have been accepted by the EEC authorities. We can see the reality of the Mansholt Plan as it will apply here. Anybody who has taken the trouble to study those schemes, that is, the farm modernisation scheme and the scheme concerned with the encouragement to leave farming, and who have any real interest in the country cannot but feel dismayed at what they find. As the Senators are probably aware, there are three categories of farmers involved in the modernisation scheme. They are the commercial farmer, the development farmer and the transitional farmer.
Our main concern, I think, is the development and transitional categories. I do not wish to bore the House with the details of these schemes because I am sure the Members are familiar with all the published data and all the comments. The important point to remember, however—and this is something which is not yet widely appreciated—is that very few dry-stock farmers in the country will be able to reach the development target. I suggest that in agriculture there are three ways, broadly speaking, of continuing in progress. The first is in dairy farming. The second is in dry-stock farming. The third is in tillage farming.
I will deal first with the dry-stock farmer and to continue the argument that I have just made. A reason for this situation is when arriving at a labour unit, which is the income for one man per year, interest on investment must be deducted from the farm income at the rate of 2 per cent on fixed capital—that is, land and building—and at the rate of 5 per cent on working capital. Working capital is livestock. Those two figures are very substantial. As the farm size and stock numbers increase, naturally, the interest on investments also increase, thus resulting in the ridiculous situation that even the 200-acre dry-stock farmer will be hard-set to reach the development target.
Another aspect of the scheme which, to say the least, is very difficult for me to understand is the manner in which the labour unit income is arrived at. The object of the EEC directive is to equate the incomes from agriculture with those from the non-agricultural sector. The average income from the non-agricultural sector for 1974 was reckoned to be £1,800. This average figure included the salaries of the highest-paid people in this country which included company directors. The figure represented gross income from which, of course, income tax had to be paid. It is quite obvious that the vast majority of those outside agriculture are earning an income considerably less than £1,800, especially in terms of net income after deductions are made. What has been reckoned as the average gross income for the entire non-agricultural sector becomes the minimum acceptable net income for the development farmer in 1974. How this can be interpreted as equating the incomes is difficult for me to understand.
I now wonder—and I really mean this—has the meaning of the word "equation" changed since I was at school, which is not too long ago? The net effect of the two items I have referred to, that is, the interest on investments and the high income target set, is that only a very small proportion of the farmers in this country and an even smaller proportion of those in the west of Ireland will be able to reach the development target. As I have already explained, of the three categories—the commercial, the development and the transitional farmers—you take the figures that are akin to those to make them into a set piece. The commercial farmer is a big farmer who operates a commercial enterprise as we know it today. They comprise 10 or 15 per cent of the total farmers of the country. The development farmer is classed somewhere in the category between 30 and 50 acres. He must have an income of £1,800. This is the point I am trying to make. Of course the other type of farmer is the transitional farmer. In Galway alone—the county I come from—60 per cent of the farmers have less than 30 acres. To bring a transitional farmer to a development stage, 30 per cent at least of that 60 per cent must get out of agriculture. In fact, what we are saying in all is that 25 per cent of the farmers of County Galway must leave the land, and with them will go their families.
As we can see, the picture is quite alarming, particularly because the transitional farmer would not be able to avail at any stage of some of the important benefits that are envisaged in this scheme. For instance, one such benefit would be the grant for the purchase of livestock. Another would be involved with grants for the purchase of mobile equipment, and yet another with the guidance premium. They would not get extra land. More distressing still is the fact that all forms of grants will cease for those farmers by April, 1977, less than three years from now.
The Minister for Agriculture and Fisheries said in the other House some time ago that something would be introduced when the time came. This is not good enough for me. I do not think that this is good enough for the farmers of this country. If that statement is to carry any weight something more definite is required now. I would say that today the Minister has an opportunity in this House of making a public statement on this point.
Let us consider for a few moments the implementation of this scheme in conjunction with the modernisation scheme. I refer to the scheme to encourage farmers to leave the land, which comes under directive 160. On paper, it appeared to have some good features. In practice, it is very different because—and I think this is important—the farmer who sells or leases his land can avail himself of the life pension only if his land is being used by a development farmer. If very few farmers are able to reach the development farm stage, how can this scheme function? The simple answer is that it cannot and will not unless the terms of the modernisation scheme are renegotiated, changed and left open for a yearly review.
I think we have come to the stage when we must in honesty make that statement. Even in places where land could be made available to a development farmer, the scheme may not operate in an equitable manner. I will illustrate that point by giving an example. Suppose there are two potential development farmers living close to each other. One may have 50 acres and the other 100 acres. A parcel of land is being divided between them. The 100-acre farmer has just as good a right and as high a priority to this extra land as has the 50-acre farmer. This is as I read it under directive 159. It will be agreed that down the years, through successive Governments, the policy has been for the Land Commission to create viable holdings which at present are deemed to be 45 adjusted acres. That is the equivalent of 45 acres of good land. Therefore, if we are to apply this policy to the example quoted above the 40-acre farmer would get priority over the 100-acre farmer. All other things being equal, I think that is fact. This is still the common sense and indeed the just way of dealing with the situation. If the directive is to be implemented the just method of distributing that parcel of land would go by the board.
Anyone who thinks the farming community will allow the EEC directives to operate in this way knows little about the thinking of the small farmers. I have given ample illustration of the impracticability of the scheme. Let us consider the position of the farmer who acquires extra land in order to achieve the development status which we all must achieve by 1977. Such a man should not be placed at a disadvantage as compared with his neighbour who has already sufficient land. He would be placed at such a disadvantage that it would be impossible for him to reach the development target because in addition to having all the usual charges, including interest on investments to meet, he would in addition be obliged to meet the further charge of repayments or rent. A labour unit income of £1,800 in 1974 is certainly an impossible target.
The County Committee of Agriculture of which I am a member discussed those schemes at a special meeting two months ago and passed some sensible resolutions which were sent to the Department of Agriculture and Fisheries. One of these recommended that the target for development farmers should be lowered so that £1,800 would be the final target at the end of the six-year plan. Another resolution stated that the small farmer should have priority over the large farmer when land becomes available under directive 160. There has been no reply from the Department.
I ask the Minister again today to refer to those two resolutions and to give us a concrete reply. If they are not workable I should like the Minister to explain why this is so. The only farming enterprises which will enable a reasonable number of farmers to reach the development target are in the other two categories I have already mentioned, that is, dairy and tillage farming. I should like to illustrate why a 50-acre farmer may find it impossible to reach those targets. Anybody with a knowledge of dairy farming knows that the first essential for a worthwhile dairy enterprise is running water. In the west where there is a high proportion of small farmers and as yet an undeveloped industrial sector, only about 13 per cent of our farmers have this facility. Shortage of water is of critical importance particularly in my own county of Galway. Group water schemes are proceeding slowly and are organised in such a tedious manner that an immediate examination should be called for.
The onus of organising a group water scheme and of submitting an estimate and a design for it is placed on the shoulders of the local people. This is too much to ask of them. The Department of Local Government are orientated towards providing water supplies for towns and industries while it is just as essential to provide those services for the farming community. It is wrong to relegate the needs of the farming community to the end of this queue.
Farming is still the biggest industry in the west of Ireland and will hold this position for a long time to come. Industry and other services will not be able to provide extra employment despite their best efforts. The farmers will be obliged under this directive to leave the land. We must not allow this to happen.
I recommend as a matter of urgency that a committee be set up consisting of top officials of the Departments of Agriculture and Fisheries and Local Government, county council representatives and county committees of agriculture with a view to examining speedily the question of making running water available to all farmers and rural dwellers. A solution must be found to overcome the long delays in getting group water schemes under way. I emphasise this point because in directive 159 we are asked to reach the development stage by 1974. I have emphasised with logical figures that it is impossible for the farmer to reach that category under the dry-stock situation. It is glaringly obvious that the farmer cannot reach it under a dairying scheme.
We know the situation which has prevailed in regard to tillage farmers. In this House and in the other House, and through every farming organisation we have illustrated the ups-and-downs of the tillage farmer over the past 40 years. We have an example of this now where potatoes are at rock-bottom price and are left at the walls to rot. How can we implement a directive, or either of the two directives, when as a farming nation we are not prepared to accept fully the diagnosis and the application of those directives?
To add to that situation we have lost in this year something to which the Department of Agriculture and Fisheries should have paid heed. They should have listened to the advisory service. We have arrived at a situation where the advisory service is at a full stop. There are reasons for this. It is not a new situation. We have heard a good many emphatic statements from the Minister for Agriculture and Fisheries during the past few months concerning the Advisers' Association ban on the operation of the modernisation scheme. I am satisfied that the advisory service enjoys the confidence of the farmers and has always done so. They have the interests of the farmers at heart even though they are proclaiming it less loudly than others. The public press, especially the farming press, could have adopted a more constructive role in this dispute. Their only contribution seems to be to attempt to drive a wedge between the advisers and the farmers. This is deplorable. This dispute, without going into it in depth, will be solved and will have to be solved. Why not solve it now rather than later on?
Finally, I would remind the Parliamentary Secretary of a recent speech delivered by one of his colleagues, Deputy O'Leary, the Minister for Labour, when he was reported to have said that some employers are still inclined to treat employees like cattle. He was referring to employers outside the Government, no doubt, but this accusation could be levelled at the employers in Government and particularly at employers who have given trojan service, such as the advisory service. I would ask the Department and the Minister for Agriculture to put the advisory service back to work so that they will learn, by the diagnosis of those advisers, that these two schemes as they now stand are not operable. They must be changed, they must be reviewed and renegotiated because they cannot and will not be applied to the farming community of today as I know them.