Bovine Diseases (Levies) Bill, 1979: Committee and Report Stages.

Section 1 agreed to.

SECTION 2.

Question proposed: "That section 2 stand part of the Bill."

Mr. Butler

We oppose section 2, a levy on milk and slaughtered or exported animals. For a number of reasons we are very much opposed to this levy system now being imposed on farmers. The main reason for opposing it is that a big percentage of farmers have already cleared the disease from their herds and are now being asked under this section to pay a levy to finance eradication of bovine TB and brucellosis from the herds of other farmers who did not make the effort in the initial stages to get rid of the diseases. We feel very strongly that this is unfair and unjust and, I fear, unconstitutional. People who made the effort over the years to eradicate disease should be congratulated on doing so because they realised the effects of these diseases not alone on the cattle industry but on the human being as well.

The advice given over the years by the agricultural advisers and the veterinary section of the Department of Agriculture was given to all farmers, not just a section of farmers. That advice should have been accepted by all but according to the figures being produced, that was not so. A section of farmers ignored the advice given. They are getting away with it because those who took advice given to them and who rid their herds of those diseases are now being levied so that others will get rid of disease. It is my opinion that those people who made no effort in the past will make very little effort in the future unless there is legislation to bind them to getting rid of disease. The levy then will have no effect on these people, but it will have an effect on the people who have already paid for the eradication of disease.

I know more about the dairying industry than the meat industry but the rate of levy—0.5p per gallon of milk and £3 per animal slaughtered or animal exported—is very substantial. It is substantial this year because it is my belief—and I am certain of this because I am involved in the industry—that farmers will make no profit whatsoever out of milk. I am sure the same is true of people who are feeding cattle to produce beef. There will be no profits for farmers this year for the simple reason that a number of levies have been imposed on them over the last 12 months. The co-responsibility levy is 0.327p a gallon. The Bord Bainne levy, which we all support, is 1 per cent. The Agricultural Institute levy is .05p. The agricultural produce duty, which is the one that we hear so much about, is 2 per cent. This levy has been opposed violently by all the farming organisations. The milk levy is 0.2 per cent and there is the bovine disease levy of 0.5p. All those taken into consideration would add 2½p on farmers' costs, without any increase to the farmers for their produce, especially for milk production. We have heard of the cost of living and the national inflation of 14 and 15 per cent. This also has an effect on the agricultural sector and financial people have informed me that it is going to cost the farmer up to 3p a gallon. By the introduction of all the levies farmers will receive much less for their milk this year and in future years. Is this the time to impose levies? We need farmers to produce more. The inspectorate attached to the Department of Agriculture are advising managers in the dairy industry to encourage farmers to produce more but the Minister of that Department is coming in here imposing a levy on farmers through this Bill. There is a contradiction there, where you have one section of the Department of Agriculture advising that farmers should be encouraged to produce more milk and then you have another section of the Department who, by introducing the levy system, are discouraging farmers. It is my honest opinion that if this section were put to the farming organisations and their members, irrespective of their political affiliation, their unanimous decision would be that the section is wrong. There is not one member of any farming organisation who would agree with the Minister today that this levy should be imposed.

Ruairí Brugha

Do people agree with income tax?

Mr. Butler

No, of course they do not. They want a fair distribution of that income tax. The levy is wrong because it is not a fair levy. It is coming at the wrong time when we should be encouraging farmers to produce more. The investment in the dairy industry over the past number of years, especially the past two or three years, has been enormous. New milk drying plants have been erected and machinery to deal with cheese has been introduced in the creamery industry in the past year or two which cost millions of pounds and which must be paid by the farmers. If we are to have a situation where farmers because of the levy reduce the supply of milk to the creameries then that in itself will create a further levy because the manpower will still have to be employed to help process the milk. There will be no reduction in that as far as I know. We will try in the dairy industry not to have any unemployment because of this legislation but if we have to keep the people employed then there is going to be extra cost on the reduced amount of milk. That is natural.

The Bill is a bad Bill. The aim of removing bovine diseases is right and we must all do our bit to help. The danger is that farmers will get out of milk completely. I am deeply involved. I am a member of the Irish Creamery Managers' Association, even president of that association. I meet creamery managers every second week. They know the cost of production and the effect this and other levies will have on milk production and they are worried that production will be reduced substantially. They are trying to encourage farmers to stay in milk but it is difficult. Hundreds of farmers have come to the creameries for that famous form that will compensate them for getting out of milk. The only reason is that there is no profit in milk. It is a seven-day a week job. A member of any union would be compensated for working the hours put in by farmers each week.

I think Senator Whitaker said last week that a lot of money was wasted over the years on the eradication of diseases. Comment was made to me by farmers since that statement appeared in the papers—I do not like mentioning this—as to who was the financial adviser to the Government at that time. I would like to say this. Let us do our bit for the farmers of Ireland, not alone for the farmers of Ireland but for all sections of the people. Agriculture provides employment in related industries and because of that everybody will be affected by this legislation, and especially by this section.

Mr. McCartin

Naturally this side of the House is opposed to the section. This section has nothing to do with animal disease. It is just another measure designed to improve the finances of the Government at the expense of the agricultural community.

I cannot see how this section fits into a Bill which is supposed to contribute towards the elimination of disease. It is just another indication of how far this Government are prepared to go by every means they can devise further to impose a heavy burden of taxation on an industry without any regard whatever to the effect it will have on the performance of that industry or the ability of the individuals engaged in it to contribute by way of taxation. The milk levy appears innocent enough, at ½p on the gallon of milk, but considered from another point of view it is oppressive. A case came to my notice recently of the son who came home from an agricultural college but did not intend to go back to the land. Anybody can see why. This man projected for me what yield his mother, a widow, could expect from her milk cows at the end of the year. On the basis of the last six months he projected that his mother would have an income of around £20 a week from 11 cows. Looking at the provisions in this section and assuming that that farm produced 11 calves which would be sold for export, considering the charges against the milk and against the exported calf that person's income would be reduced by 70 per cent in one year.

Looking at the performance of a similar farm last year, we can take it that the widow has already had her income reduced by ten per cent in real terms. Even if she increased milk yields and improved the performance of the herd, and the farm, she would still, in real terms have taken in this year a drop of ten per cent in her income. Under the provisions in this section she has to take a further 7 per cent drop in her income. The provision in this section in unjust and unfair. The results of the last farm management survey by the Agricultural Institute showed that 40 out of every 100 farms in Connacht and Ulster had an income of less than £20 a week in 1977. We can assume that the incomes of 40 out of every 100 farmers in that region are being reduced by 5 to 7 per cent by the provisions in this section. This is a most unjust and severe penalty to impose when we consider that the vast majority of people in that under-developed region had no disease problem for many years and paid the price of eradication many years ago. They suffered closures of their herds for a number of years, and the loss of milk production in cases where brucellosis was a problem, but the vast majority of them now have clear herds.

This section has nothing to do with animal disease. It is purely a measure designed to get more money for the Government from a section of the community which could not be considered capable of paying it. I am not speaking for the very big dairy farmers who perhaps could bear that levy. What other section of the community could be expected to bear, as a result of the negotiations entered into by the Minister in Brussels this year in real terms a drop in their income, and also to increase production by something like 15 per cent just to remain as well off as they were last year? What other section of the community would accept that package from the Government? They will not get away with it. The provision in this section are absolutely disgraceful and are particularly dishonest in view of the fact that they are included in a Bill which is supposed to relate to animal disease.

I do not think that the Minister enjoys the job he is doing here in the Seanad today. The Minister will not seek to justify this even to the hard hit farmers in his constituency who will be forced to pay this levy. For a slaughtered animal £3 per head is a bad enough burden to bear. It is bad enough, at the level of the butcher, who will perhaps pass it on to the consumer but in the factory or in the mart the farmers in most cases will end up paying.

This is particularly hard on the small dairy farmers, who have depended in the past on the export market. While it has not always been good for the economy we might be glad to see the time again when we would have an export market available for calves. It is likely to happen at any time that we will need an export market to keep the price of calves at a reasonable level in the spring of almost any year. That £3 is a further three per cent levy against a calf being exported, and it is a penal tax on an industry that is finding it very difficult at the present time. While we in this House cannot amend this section we can at least oppose it, and I certainly will do everything to prevent the Minister from passing it by voting against it.

Mr. Connaughton

I absolutely oppose this Bill. As Senator McCartin stated, this Bill is designed not so much to eradicate disease as to get extra finance into the Exchequer by a back door method. Much was made of Senator Whitaker's statement that what happened to the disease eradication programme was a national scandal having regard to the amount of money that was involved in that scheme over the years. But let no man point the finger at the farming community. I never yet met a farmer, either a big or a small one, who was delighted to have disease in his herd, because he always came out a loser. This Bill so far as disease eradication is concerned has not one point in its favour to suggest that we are any nearer to a better eradication scheme.

Non-farmers would want to bear in mind also that in itself a ½p per gallon will not break the backs of the dairy farmers but taken in conjunction with what has happened to farmers' taxation in the last six or seven months this is the seventh round of taxation. The Government are making a dartboard out of the farming population and this is just an extra dart into their hearts. Before the year is over they will have their hearts well pierced, because this is the only place left from which to raise money.

In relation to the £3 per animal either slaughtered or exported live, the Minister of State is very much aware than many of the store cattle producers in the west have a good market for their cattle in Northern Ireland, a trade which develops from now until the end of the year. On the night of each sale, as the lorries cross the Border into the North, this £3 becomes payable. However, before an animal gets to the mart the vet must be paid for the new 30-day test, which costs from £5 to £8, the mart fees which could be £2 or £3 must be paid, transportation of the animal to the mart must be paid for and on top of all that the farmers must pay on that animal the two per cent commodity tax. A £400 animal from County Galway or Mayo crossing the Border next week will have cost the farmer generally a small producer, between £20 and £22 per head in tax. About £22 on £350 or £400 is some tax. That came in seven darts.

On the introduction of the 30-day test I said that we had seen the beginning of the scheme to get farmers to pay for the entire eradication scheme. In direct answer to what the Minister was quoted as saying in the newspapers last week, I should like to say that this Bill will do nothing but penalise farmers who have already been hit by the disease.

As Senator Butler said, there is growing concern in the dairying sector that the producers are going to be taxed out of existence, particularly when one considers that the Minister spent many man hours in Brussels at price fixing meetings earlier this year to ensure that the co-responsibility levy would be lowered or eliminated. Not alone did that not happen, but the Minister came back and decided to put more taxation on the very farmers for whom he was trying to get the reductions. From the point of view of EEC Ministers, that does not look like a very sincere effort.

Taken in isolation this Bill might not seem as bad as it is. If I thought the eradication disease programme would be speeded up by the introduction of this Bill, I would be in agreement with it. The basic structures are there all the time for the disease eradication programme. Nobody will deny that farmers are entitled to pay their share to get rid of the disease. I can assure the House that there are many thousands of farmers who have been penalised almost out of existence because of animal disease.

Was the Minister reported correctly in one of last week's newspapers? He is reported to have said that there was a lot of fooling around with the eradication scheme. He made some reference to the years the Coalition Government were in office. We have been trying for 20 or 25 years to eradicate diseases. This did not all happen two or three years ago. This is an on-going disease.

This Bill, taken in the context of what has happened as regards farmer taxation in the past five or six months, is another step on the road to ensuring that farmers lose all the benefits they had grown accustomed to, and to which they were entitled. I should like to put on record that it is important for every man, woman and child that TB and brucellosis be eradicated from the national herd. Three out of every five persons in employment are employed either in agriculture or in industries related to agriculture. The minute there is the slightest trace of a recession in agriculture—as is well known from the 1974-1975 period— everybody suffers. That is something Senator Whitaker knows very well. A bland statement to the effect that farmers were getting away with a certain amount of leeway and not paying their fair share is not correct. In the context of all the rounds of taxation that have hit the farming community, this is a particular bodyblow.

I have no doubt the Minister will be sorry, because our growth rate in agriculture is almost static. From an investment point of view, the banks and the ACC are not happy about large investments and farmers are loathe to invest. This is not good criteria. It is not good encouragement for young farmers to increase production. Farmers will say that from the record of this Government all they can see for themselves for the future is taxation, as a result of which they will not be able to make ends meet. The Minister of State should know what I am talking about.

This Bill is a disaster. This section is a disaster for everybody, irrespective of whether he is a farmer or not.

Mrs. Cassidy

While I accept that the eradication of bovine diseases will benefit all the community, both producer and consumer alike, I must express the concern that is felt by housewives that they will have to bear the brunt of the cost in the form of increased prices for meat and dairy products. This concern may very well be unfounded and may be due to ignorance. For example, the recent increase in the price of meat may very well be due to the long harsh winter and the shortage of grass in the spring, but the housewife does not know that. She blames it on the 2 per cent levy. When one considers the statements by the various victuallers associations at the time the levy was imposed that they would not act as tax gatherers for the Government, who can blame her?

I see this as a problem of lack of communication. It has resulted in a situation whereby the producer feels that he is not getting his fair share of the selling price. The housewife feels that the price she pays for food goes in some way to subsidise the farmer. It is very difficult for the housewife to understand our support of the common agricultural policy of the EEC when she has to put up with such anomalies as butter mountains and milk lakes and when she considers the price she has to pay for butter here.

I see this as a blockage in communications. I hope that the recently appointed Director of Consumer Affairs will see it as part of his brief to deal with this blockage so that the farmers and the housewife can understand and be aware of each other's problems.

With regard to this particular levy, I should like to get an assurance from the Minister that he will see to it that it is not only a charge upon, but is paid for, by the farmer and that it will not be passed on to the housewives.

Mr. Markey

I should like to add my voice to the protest against this section. In the Preamble to the Bill it states that it is an Act to provide for the purpose of facilitating the eradication, or the prevention of the spread, of bovine disease. I cannot see how imposing a levy like this is going to facilitate that purpose.

What exactly does a levy do? If it were to act as a deterrent in some sense, or as an incentive for the farming community to be more careful about herds and milk control, one could see some justification for a levy of this kind. It does not seem to fall under those criteria. It seems to be there to gather funds to meet the Department's costs in eradicating bovine disease. That may be all right from the Department's point of view, but there are many areas—for instance, housing—where there can be a wastage of money and abuses of a system. If we are to start thinking that the solution to all these problems is merely to impose a levy on certain categories of our community and give others the job of tax gatherers, we are not facing up to the task before us in a responsible or realistic way.

Senator Cassidy is rightly afraid that somewhere along the line the consumer will have to pay for the imposition of this levy—0.5p on a gallon of milk and £3 per head of cattle. It may not seem unduly large, but when it is aggregated it may well be that the consumer will have to pay for it.

The present time is completely inopportune for the imposition of a levy of this type. The agricultural community have probably seen the days of wine and roses within the EEC go for good—I would certainly hope not—to the extent that they have enjoyed the benefits of the common agricultural policy in recent years. They do not seem to be in a position to benefit, in the years ahead, to the same extent and therefore to come along with a levy like this and impose it upon them to correct something which has been prevalent in herds—very many farmers have seen their herds put down not once but twice or three times—is not going to instil confidence in the farming community for the future. I protest against this levy. It seems to be an extension of what this Government are doing. They seem to have adopted the old motto: if it moves at all, tax it.

Miss Harney

I think we will all agree that the eradication of animal disease is desirable and that the community at large will benefit. I will have to disagree with Senators Connaughton and McCartin. I did not hear Senator Butler but I gather that he also does not approve of the fact that the farming community have to pay for the eradication of this disease. For too long the Exchequer, and particularly the over-burdened taxpayer, have had to write off the bills for the farming community. For too long many schemes of this nature have been subsidised and paid for by taxpayers who have to pay for so many other services. It is right and proper that the agricultural sector, and particularly the farming community, should shoulder this burden. I cannot agree with Senator McCartin that they are so badly off. Perhaps some of them are badly off but by and large they are well able to afford to pay for these schemes. Generally speaking, it is the farming community that will reap the benefit of having this disease eradicated and it is only right that they should pay the cost. We have a small tax base in this country. I wonder how we are supposed to pay for the scheme when the farming community are not to pay for it and if they seriously want disease eradicated. I would like to know what alternative methods they would propose to pay for the high cost of this scheme.

Mr. Donnelly

I want to make a brief contribution consistent with a point I made on Second Stage but which has relevance here. The point that Senator Harney is making is well made. There is general agreement that there is an objective here, the elimination of bovine disease which stands as something which must be achieved in the interests of the farming community and also the whole community. There is no dispute on that point. We are talking about a means of financing this stride to eliminate disease. We get back to fundamentals in this issue, exactly where the money will come from. There is a great deal to be said in favour, where it is applicable, of identifying the use of money which is raised with a particular objective. That is something that is not always achievable in the broad mass of revenue raising but is certainly achievable on this occasion and it is a particular advantage that arises. In addition to that, there is the question of equity. Whereas the success of the elimination of bovine disease is of fundamental importance to the whole economy, it is immediately and directly of importance to the farming industry and the farmers. It is not unreasonable that in something as clear-cut as this, something as identifiable as this, that a contribution should be made directly from the industry which will immediately benefit from it. While the Opposition points of view are in a sense predictable, nevertheless I am still to some extent surprised by the absence of suggestions of any alternative. The money has to be raised; if it does not come in this way it must fall on the broad mass of taxpayers; it must come to a great extent from the PAYE sector. Is that precisely what the Opposition are offering us?

Mr. Connaughton

Was it in the manifesto?

Mr. Donnelly

Let us deal with the points we are debating here and let us deal with the points made by the Opposition. We must be clear. If the money is not raised through a levy as indicated in the Bill it must be raised from general taxation. We should hear from the Opposition precisely how they suggest that the money be raised if they are proposing—and it seems clear that there is no alternative—that it should fall on the general body of taxpayers and particularly on PAYE taxpayers. This is a very fundamental issue. The Opposition have made their opposition clear but they have not indicated any alternatives. This is just blind opposition. The proposals are reasonable—to raise money from within agriculture specifically for the benefit of agriculture in the first case and undoubtedly, as is accepted, for the benefit of the whole economy beyond that point. But there is a fundamental issue here. There is an advantage of being able to identify the objective of raising the revenue with the benefit and that is something which is well worthwhile in itself, but there is also the question of equity. I believe that it is far more reasonable to raise the levy in the particular way indicated in the Bill rather than have it fall on the shoulders of the taxpayers which would include to a great measure the PAYE taxpayers.

Mr. Butler

If farmers are not encouraged to produce more there will be more unemployment. Any levy put on any section of people is a discouragement and this levy is a discouragement on farmers to produce more; it is an encouragement to farmers to produce less. If farmers produce less then there will be greater unemployment. Who pays for that unemployment except this State? Is it not better to have people employed even though they may be subsidised to some extent by the State? Thousands of people are already subsidised in employment—why not farmers? It is recognised that they are the backbone of this country. We can see this if we look at the figures for agricultural output and costs and income for 1977 and look at the exports. The value of live cattle exports alone was £130 million. That is money coming into this State. The value of beef, fresh, chilled and frozen—factory beef that is giving employment—is £300.5 million; beef preparations and canned beef, £1.6 million; cattle hides, £13.6 million—all giving employment; milk and cream, fresh and dried, £55.1 million; creamery butter, £38.3 million, and so on. I could go on to animal feedstuffs and pigs £3.3 million, but the total value of those agricultural exports is in the region of £720 million.

That is what agriculture is doing for this country, getting the money in so that it can be distributed throughout the country. That is what the farmer is doing. That is the compensation the farmer is giving to the people. He is also creating the industry. There is no doubt that the farmer is playing his part and must be compensated for it. He must not be downtrodden by legislation or penalised for production and effort. That is what I am against. These are people who made the effort to clear their herds of the diseases and they are now being penalised. What encouragement is that to any section of the community to make an effort? None.

Mr. W. Ryan

As a farmer, I will be affected by this levy. It is only natural that farmers, or any other section of the community, will grumble if a levy is imposed on them. I do not believe that the farmers are very worried about this levy. Maybe the three Senators on the opposite side are worried. Senator Connaughton, when speaking on Second Stage, mentioned all the levies the farmers have to pay, including the levy they have to pay at the mart. Surely he does not expect the Government to pay the levy for the people who are selling their cattle at the mart? He spoke a lot about the 2 per cent levy which has been imposed. He conveniently forgot to mention the 12 per cent levy that was about to be imposed——

Mr. Butler

Never imposed.

Mr. Connaughton

But was not.

Mr. W. Ryan

We must get rid of bovine TB. Senator Butler has just mentioned all the money cattle are bringing into this country in revenue. Remember, if we do not get rid of bovine TB within the next year or two, we will not have that money because our cattle will not be exported. Then we would have farmers available for unemployment assistance. People say that if this levy is imposed it will reduce production of milk and other dairy products. That is nonsense. That will not affect milk or anything of that kind. We have heard a lot of talk from the three Senators on the other side about this but, if they were serious about it, why did they not put down an amendment?

Mr. Butler

We cannot amend that section and the Senator should know that.

Mr. W. Ryan

The Senator could have made a gesture. He had amendments down on the Housing Bill which were ruled out of order but he could have put——

Mr. Butler

We inquired and were told that we could not amend that section.

Mr. W. Ryan

I wonder at that.

Mr. Connaughton

We are leaving——

Acting Chairman (Mr. Harte)

Senator Ryan without interruption.

Mr. W. Ryan

The Senators came here to oppose this levy and they are wrong in doing so. The money that will be collected from this levy will be well spent. If we have to get rid of bovine TB, and if we are to impose the levy, surely it must be the producer who should pay it? It is hardly the PAYE people who should pay it.

Mr. Markey

The core of Senator Donnelly's argument seemed to be that since farmers benefit most immediately and directly from the elimination of bovine diseases, they should be asked to pay for it. We cannot pursue that argument too far because we see many other spheres where it does not stand up. For instance, who benefits most immediately and directly from the provision of local authority housing but local authority tenants? Yet, by no stretch of the imagination, can it be said that local authority tenants are being asked to pay for the provision of local authority housing. We may forget that argument.

Is the elimination of bovine diseases simply a question of money, which is what seems to be envisaged in the Bill? There must be many other aspects in it other than just the provision of money for the elimination of the disease. Is it properly supervised? How adequately has it been supervised in the past? Have there been abuses or some wastage of public money in the past? That is what we would be tackling and concentrating on to eliminate in the future. I do not believe that the imposition of a levy can be seen as a means towards which bovine diseases will be eliminated. The nature of agricultural production is of national concern and of such immense value to us that it must be faced up to nationally rather that just being pitted at the farmers' level, that they must pay the cost of it.

Minister of State at the Department of Agriculture (Mr. Hussey)

I find it difficult to understand the attitude of the Opposition Senators in their approach to this measure. On the one hand, they say they are all in favour of the eradication of bovine TB and brucellosis from our national herd. On the other hand, they are totally opposed to any measure to provide money for that scheme. Senators must realise that if we are to eradicate this dreadful disease that everybody is so concerned with from our national herd, it must be paid for. If they are not in favour of the levy which is being proposed in this measure, they should stand up and say that the Government should put it in as an ordinary tax measure and have it paid by the PAYE sector. I do not think they have the right to oppose the measure without saying where the money is to come from. The money being asked for in this section amounts to only about 1 per cent of the price the farmer gets from milk. This year the Exchequer is providing £22 million for the eradication of bovine TB and brucellosis. The measure being introduced provides about £10 million towards that scheme.

We realise that a lot of lip service has been paid to the eradication of these two diseases over the past 25 years. Farmers, cattle dealers, vets, Department officials and successive Ministers have been blamed over those years. For the first time ever, the present Government are coming to grips with this problem. The determination of the Minister, Deputy Gibbons, is acknowledged, and he has shown that he is prepared to make a concerted effort on the eradication of these two diseases, unpopular though the measures imposed may be.

We have heard a lot of criticism from the Opposition of the 30-day test and the disaster that will befall the farmers because of the introduction of that measure. By and large the farmers, over the past number of months since this measure was introduced, have accepted the problems and troubles it imposed on them because they realised it is in their own interests that this disease would be eradicated. It is certainly in the interests, not alone of the farmers but of the whole country, that we come to grips with this problem immediately.

Senator Butler mentioned the figure of £720 million which we have got from exports of agricultural produce. If Senator Butler reflects on the situation that would arise if our EEC partners refused to accept our cattle or our dairy produce because we had a high incidence of disease, imagine the loss it would be to the farmers and to the country. That is what we have to concern ourselves with at this time. The dangers to the country are too great. The farming community will accept this measure because they realise that time is running out on them unless we come to grips immediately with this problem of disease eradication. That should be the main concern of everybody. While Opposition Senators may be making political points on this, they too realise, as well as everybody else, that time is running out on us and that we must make an effort to get rid of this disease. If we do not get the money under a levy of this kind, we have to get it some other way, but so far the Senators who have spoken have not suggested any other way.

I realise that levies or taxes are not popular measures but the money has to be found. The eradication of disease is a very expensive business and if we do not get the money this way we will have to go back to the Exchequer and ask the PAYE sector to pay for it. I do not think that measure would be acceptable either. There would be an outcry from other Senators—maybe not those involved in the agricultural sector—who would be more concerned with the welfare of the PAYE workers.

Mr. McCartin

The Minister emphasised the percentage of the price of milk which is being collected, but the average farmer does not care what the percentage of the price of milk is, it is the percentage of his or her profit that counts in the end. This can be as high as 8 per cent of the profit of a person who is actually earning less than £20 per week and must live on it. There is a gross misconception as to what this levy is all about. This section is purely designed to collect money. There are no guarantees that the money so collected will be spent on animal disease, that the level of activity is going to be increased by 50 per cent or that this levy will cease to be collected when the money is no longer required.

In addition, it is not fair or reasonable to suggest that every industry should pay for whatever taxation is involved directly in servicing their own industry. That does not make sense at all. We now find ourselves with a serious animal disease problem that affects the potential and performance of the industry on which the Irish economy depends. We now find that the average person engaged in that industry is not in a position to earn a labourer's wage. We know from the figures of the farm modernisation scheme that less than 5 per cent of one-third of the top half of the farmers have not succeeded in being classified as development farmers or as being able to earn a comparable income for the region in which they live. There is no lack of proof for the fact that farmers are not learning the sort of living that is available in industry generally in any region here.

Governments in the past, faced with this situation, recognised that only through assistance from outside the industry could disease be eradicated. I agree that the money was not spent well but I would not propose to lay all the blame on any one section of the community, the vets, the Department or the farmers. The farmers were not all to blame and there was a time when it paid to have reactors. That was due to the carelessness of the Department of Agriculture at that time in designing and supervising a scheme which would operate in the interest of eliminating disease and at the same time give farmers a fair compensation. At times money was squandered uselessly and aimlessly and testing was not carried out as it should have been. However, the farmers were not to blame for that. If one looks at the whole structure of the agricultural sector one will see the fantastic problems that any Government had to encounter when they set about dealing with the hundreds and thousands of farmers in the different areas. These farmers had different problems, were different people and of a different age structure. It was a massive problem which could only be solved by getting assistance from outside through the Marshal Plan, originally and later through taxation.

We forget that we have already transferred this year a large portion of the burden of eliminating disease or eradicating it by the introduction of the 30-day test, and by compelling farmers to pay for it. Now we go further and transfer another section of that burden. It is worse than that because there is no guarantee that this money will be applied directly to eradicating the disease or any guarantee that this tax will cease when the disease is eradicated or when the cost of the scheme drops below £10 million. This is a bare, bald measure of taxation designed to take more money from an industry that cannot afford it and from people who are not earning the minimum wage necessary to give themselves and their families a living.

Mr. Donnelly

I should like to clarify a point. I did not suggest that all revenue for the benefit of a particular industry should be related to that industry. I enlarged on a point I was making on Second Stage when I stated that revenue is essentially concerned with redistribution of income and, as such, it is obviously not possible to raise it from a particular source and exclusively spend it on that source. It is concerned essentially with the redistribution of income. We have a sensitive problem generally in the whole area of revenue raising and legitimate requests and demands for equity. One of the great problems I find is that it is such a complicated problem, with so much money to be raised through such a mass of legislation, that it is very difficult for the ordinary taxpayer to understand or comprehend in any meaningful way exactly how the money is raised or spent. That complicates the issue and adds to the difficulty in working out an equitable system. In the exceptional cases where it is possible to identify a cost with a benefit, that opportunity should be taken. That is what I was saying about this issue in principle.

Senator Butler felt this could lead to a reduction in production. In principle, that shows a clear grasp on the part of the Opposition of the approach by Fianna Fáil to taxation. By bringing reason and a sense of fair play to the taxation system we restored confidence, but where it is possible to identify a cost with a benefit that opportunity should be taken. This is a contribution towards the total cost of the eradication of the disease. The Senator might just as well say that the ordinary worker who pays PRSI could say that if he did not have to pay that he would have an inducement to work harder, as a result of which he would earn more and would pay more through PAYE. None of those points can be applied in the absolute; there is a case for commonsense, a case for judgment. The ordinary worker makes that contribution every week towards his own medical care, his own pension or whatever way it is possible to benefit from it.

If the issue was seen in perspective the Opposition would find that the farming community are far more rational and fair-minded in this than they are giving them credit for. The key point in this section is that at no stage have the Opposition come up with any alternative or suggestion other than the implied solution that it should fall on the shoulders of the PAYE taxpayers. It would be interesting to learn if that is official Opposition's policy on that matter. Does that represent the Fine Gael solution to this problem?

Mr. Butler

I should like to know where the 2 per cent levy will go. It is estimated that £50 million extra will be collected from farmers for distribution by the State. In itself that constitutes an extra burden on the agricultural sector which was never there before. It is a levy which, in my opinion, is an incorrect way of introducing any form of taxation. Levies are not fair and have never been fair. If there is a reduction—and I am almost certain there will be a reduction—because of the demand by the farmers to allow them to get out of milk, there will be a reduction in milk production leading to further unemployment. Who will pay the people who will be unemployed but the State? It will constitute further taxation on the PAYE earner. So we are saying that that should not be allowed happen but rather we should encourage farmers to increase production.

By increasing production one is increasing employment and taking more people off the dole, particularly in rural Ireland, because if that type of attitude spreads throughout rural Ireland—if people feel that they can get money for doing nothing, and that is what the dole is—then more people will opt for that. We do not want that, we want people employed and the only way to have people employed in rural Ireland is to increase agricultural production. That is one of the main areas in which employment can be increased and that is accepted by everybody.

So why impose a levy system, which I have opposed, to help reduce production? The farmers have said that unless they can make a fair profit—and they are entitled to a fair profit—then they will have to do something else. Our farmers have been downgraded for too long. It is only since our entry into the EEC that farmers have gained financially in any way. Now that we are in the EEC and they are financially sound, why walk on them? This Bill will do just that. The attitude appears to be: you have the money now and we must take it off you; we are not going to give you any opportunity to reinvest that money. The cry from the PAYE sector is for a fair taxation system for the farmers—that is what they are looking for—but the levy system is not a fair taxation on anybody.

Why—I have asked this question several times but received no answer— must those who made the effort to get rid of the disease and clear their herds now be penalised by this Bill, to help those who made no effort whatsoever, those who probably helped to spread the disease? Why must the people who made the effort now pay the penalty? I cannot understand it and I am very disappointed with the answers I have been given here.

Mr. McGowan

This is the kind of subject that can be argued from any side, the answer depending on one's attitude and the amount of politics one wants to play with this subject. On Sunday last I listened to "Country Call" on Radio Éireann for about three-quarters of an hour while I travelled in my car. The programme should have been described as the Fine Gael or the Coalition-sponsored programme because it was nothing short of sheer organised and blatant propaganda. This Bill has been the subject of a fair amount of discussion, perhaps rightly so. Certainly nobody has been restricted in his comments or prevented from putting forward alternatives. The 2 per cent levy is resented by the sector best able to pay it. One could cite many different examples of what the 2 per cent means. As Senator Butler rightly says: who will pay the £50 million? That is a good question because who will continue to pay the hundreds of millions that have been poured down the drain? We are reaching the stage in life in Ireland, in every facet of business, when people are saying: "I am no longer going to carry the other fellow on my shoulders. I am no longer going to carry sloppy administration and bad farming techniques." This is the outcry of the mass of the people, the people who are being taxed. The people who are contributing are saying it is about time the farming section got organised and paid their full share. Part of the propaganda campaign on the programme that I listened to on Sunday last was that Paddy Lane, the farming leader, said that the Irish farmer now had to pay four different levies. It is better that he know what he is paying for. I would prefer the parish priest who stands up on a Sunday and says: "You have to contribute so much for tarmacadaming the car park and so much for extra toilets," and names the areas on which he is going to spend the money rather than the fellow who keeps one throwing into the bucket all the time and not indicating where it might be going. Certainly there have been serious abuses and had not the Government taken some positive action there would have been no end to this tunnel, certainly not one that any reasonable person could foresee.

Therefore, I feel this action and legislation was very necessary. Those who preach that it will be a hardship on the farmers are fighting a losing battle. Most farmers and most people are reasonably intelligent and can see that it is a very small levy. To my mind the levy is being imposed on those people who would be inclined to abuse the system and cause the spread of the disease making them more aware of the seriousness of the situation. Certainly, while I do not want to be my neighbour's keeper, I will be aware of the abuses that are taking place on the farm quite close to me. The Bill intends to do that, to make all of us more aware of how much the spread of this disease will cost the country. It is proper that there should be a levy. My colleague, Senator McCartin, says it should not be imposed and he is looking for a guarantee that it might be withdrawn. I would say that whatever its chance of being withdrawn when the disease has been eradicated if it is imposed by way of a taxation system where it cannot be identified its chances of withdrawal are much less. I am glad that it can be seen clearly that this money is going to the eradication of the disease.

I am satisfied that the steps being taken are necessary, that legislation is necessary and that it constitutes a positive contribution to what has been a serious burden on the whole of our capital development. All of us want to see more money devoted to creating jobs for those who are unemployed, to the development of roads and houses. All of our national development in recent years has been impeded by money being continually thrown down the drain. Had this Bill not been introduced the Government would have failed miserably in checking what is known to everybody to be a scandal and a waste of money.

Mr. Connaughton

When the budget was finally announced it transpired that the agricultural grant was removed from farm valuations over £40; there was a drastic reduction the more the multiplier was increased, and so on. Then we had the introduction of the 2 per cent levy. I thought that was the alternative about which everybody is talking and that that was how farmers were going to be penalised for everything in agriculture in 1979. We are in absolute opposition because we will be back again after the summer recess to another type of legislation earmarked for something else. It brings us back to the question of taxation structure of which there is none at the moment. Any administration that would go back looking for money to the same industry six or seven times in as many months could not have a structured taxation policy. Senator Donnelly is concerned for the alternative. We had believed that the alternative amount of finance had been drawn from the farmers of Ireland through the budget. It seems that we have a budget every month and God knows where it will finish. There is no money left in the kitty to do anything because it was spent on all types of hopes that did not materialise. The only way the Government can get it now is through this indiscriminate type of taxation. It is indiscriminate because it takes no account at all of the ability of the farmer in question to pay. PAYE people want a discussion on the merits or demerits of the various types of taxation. We know that they are very hard pressed, but at least they know what they have to pay at the beginning of the year. There is not a farmer in Ireland who could have foreseen that he would have been hit by so many codes of taxation in five or six months. That is what the problem is about.

Question put.

The Committee divided: Tá, 20; Níl, 15.

Tá

Brennan, Séamus.
Brugha, Ruairí.
Cassidy, Eileen.
de Brún, Séamus.
Donnelly, Michael Patrick.
Ellis, John.
Harney, Mary.
Herbert, Anthony.
Hyland, Liam.
Jago, R. Valentine.
Kiely, Rory.
Kitt, Michael.
Lanigan, Michael.
McGlinchey, Bernard.
McGowan, Patrick.
Mulcahy, Noel William.
O'Toole, Martin J.
Ryan, Eoin.
Ryan, William.
Whitaker, Thomas Kenneth.

Níl

Blennerhassett, John.
Burke, Liam.
Butler, Pierce.
Connaughton, Paul.
Cooney, Patrick Mark.
Governey, Desmond.
Harte, John.
Howard, Michael.
Kilbride, Thomas.
Lynch, Gerard.
McCartin, John Joseph.
Markey, Bernard.
Molony, David.
O'Brien, Andy.
Staunton, Myles.

Tellers: Tá, Senators W. Ryan and Brennan; Níl, Senators Burke and Harte.

Question declared carried.

Section 3 agreed to.

SECTION 4.

Question proposed: "That section 4 stand part of the Bill."

Mr. Butler

I want clarification on one point on section 3. During the year there are surpluses of milk——

An Leas-Cathaoirleach

Section 3 has been passed and the Senator will have an opportunity on the Fifth Stage to make a point.

Question put and agreed to.

Sections 5 and 6 agreed to.

SECTION 7.

Question proposed: "That section 7 stand part of the Bill."

Mr. McCartin

I would like clarification on this section. In relation to a farmer supplying liquid milk to customers in the type of town that we are all familiar with and in the event of an outbreak of disease in his herd coming to the notice of the Department of Agriculture they will notify all of his customers of this fact. If that is the case, what is the point in this, even if the Department are not satisfied on medical grounds that there is any good reason why a scare should be created among customers or why the question should be raised at all?

Mr. Butler

I would like to follow Senator McCartin's point and to refer to sections 7 and 9. I am not very happy with these sections. I do not really understand them properly. Does it mean that in the case of an infected cow in a herd that that milk cannot be supplied to the creamery or the bottling plant? There is no clear indication in sections 7 and 9 that this is so. I imagine that is what is meant. If that is the case, then the creamery and the milk bottling plant are notified that such and such an animal belonging to such and such a supplier has brucellosis or TB and that milk should not be supplied to a bottling plant or a creamery. That is no guarantee that that milk will not be supplied. The only guarantee probably is that the creamery might see on the day following the notice that the supplier is down so many gallons of milk. That is no indication to the creamery that that is the milk of the infected herd. I would just like clarification so that I can go back and tell the people I work with what the situation is.

Seanad Éireann debate - Wednesday, 25 Jul 1979

Bovine Diseases (Levies) Bill, 1979: Committee and Report Stages.

Tá

Níl

An Leas-Cathaoirleach

Seanad Éireann debate -
Wednesday, 25 Jul 1979