Seanad Éireann debate -
Wednesday, 7 May 1986

Vol. 112 No. 7

Forestry Resources: Motion.

Mr. Kiely

I move:

That Seanad Éireann calls on the Government to prepare and implement a plan for the maximum exploitation of our forestry resources and rejects any attempt by the Government to dispose of State forestry to private banking and financial institutions.

The Forest and Wildlife Service are responsible for State forestry development and the management of wildlife, flora and fauna, conservation and game development. The total area of land is approximately 400,000 hectares, of which approximately 300,000 hectares is under forest. Approximately 4,000 hectares of plantable land is acquired each year. The area on offer is approximately 60,000 hectares. Land intake therefore, is totally inadequate.

The annual planting target is 10,000 hectares, but the current planting rate is approximately 6,500 hectares per year, of which approximately 700 hectares is reafforestation, that is forest that was cut and replanted.

In 1980 the total volume of timber sold amounted to 500,000 cubic metres and realised £6,600,000. Anticipated receipts from timber sales in the year to 31 October 1985 will be approximately £15 million. Forest and Wildlife are engaged in continued research into genetics, soils, crop-structure, plant and animal ecology. An inventory of the State woodlands is maintained and employment averages approximately 3,000. Grants are paid for private forestry. Planting stocks are mainly supplied from the 14 Department nurseries which sell to the nursery trade. Private nurseries are inspected; stocks of forest trees kept by them are small and tend to be disposed of mainly for shelter belt purposes.

Forest fires are a constant threat and the high risk period is April and May — this year there were many forest fires in February, when the weather was extremely dry — and 95 per cent of fires occur in this traditionally high risk period.

The main categories of timber produced in State forests are large sawlogs with a top diameter in excess of 19 centimetres mainly used for the production of sawn timber for the construction industry and also transmission poles for the ESB and Telecom Éireann. Then there is the small sawlog, sawlog with a top diameter of between 14 and 19 centimetres, used mainly for the production of pallet boards, boxwood, fencing etc. There is also the pulpwood, that is logs with a top diameter of between 7 and 13 centimetres, used for the manufacture of panel boards, chipboard, fencing stakes, firewood, and other commodities. The marketing of pulpwood, the produce from early thinnings, is important due to the preponderance of young plantations in the national forest estate. The establishment of a factory in Clonmel for the manufacture of medium density fibre board provides an outlet for pulpwood for the rapidly increasing production of State forests.

Delay in thinning damages crop development. It affects yields and claims have been made that thinnings are not being fully carried out due to Department cutbacks. As Senators are well aware, thinnings are important to ensure that you will have proper forest development. At present boxwood, pallet wood etc. is in big demand. Export outlets are available and existing processors cannot meet demand. Sawmills are working at half capacity due mainly to lack of supplies. Processors claim that timber is available. The Department due to unorthodox methods, lack of commercial expertise, tight departmental procedures and an inflexible tender system, inhibit progress, creating artificially high prices by limiting the amount of timber on the market and forcing them to work the mills at half capacity and lay off workers.

There are 150 sawmills of varying size. There was a closure in Kilrush some time ago. There was also a threatened closure in Mountrath. There were lay-offs there and also in Wicklow. These lay-offs are blamed by the millers on the lack of timber supplies and the high price of available timber. The people in Mountrath, County Laois, are disappointed that timber from nearby forests is being transported to the North. The Minister and all concerned saw a picket recently by the local workers who tried to prevent this timber being taken from the nearby forest, timber which they need to keep their factory in operation in Mountrath. The Government should look into this. I know that in the European Community there is free trade but I cannot understand why timber is being transported from Ossory wood, which is adjacent to Mountrath and which is required for the operation of Mountrath and to ensure full employment and that that timber is sold to the Mountrath factory.

A sawlog quota scheme operated by the Department has been discontinued with the result that the full market price is now being charged for quota allocations. Millers claim that further difficulties can be avoided if the Department's marketing division make some important decisions such as to bring forward timber sales, undertake more clear felling, accelerate the thinning process, respond to market trends and operate in a commercial manner. It is estimated that there will be an 8 per cent shortfall in world supply of timber by the year 2000 and a 32 per cent shortfall by the year 2025.

The EC is only 50 per cent self sufficient in its timber needs. Actually, next to oil the EC imports timber; oil costs most and timber is next. The EC will import 100 million cubic metres of sawlog and pulpwood per year by the end of this century. Imports to the EC per year are worth approximately £10,000 million. The United Kingdom imports 90 per cent of wood requirements currently running at £4.5 billion and will only supply one tenth of its own needs by the end of the century. Irish demand will increase by 90 per cent by the end of the present century: indications are that prices will continue to rise for the foreseeable future.

Ireland has the soil and climate that make it more suitable for growing trees than any other country in the EC. The average annual growth on marginal land here has been 15 to 25 cubic metres per hectare whereas the average growth in other European countries is two to five cubic metres per hectare and in England 11 cubic metres per hectare. Home grown timber supplies 25 per cent of the demand for construction softwoods of which we import £50 million worth a year. Total wood and wood products imported here per year are worth £400 million to £500 million, 80 per cent of which could be replaced by home grown timber.

Some years ago the Government established a review group to examine present structures of the Forest and Wildlife Service and make recommendations on changes. The group reported by June 1985 and we got the review in November 1985 which represented the findings. I see that the amendment states:

To delete all words after "Seanad Éireann" and substitute the following:

"takes note that the report of the Review Group on Forestry which was set up in accordance with the Government Plan Building On Reality is at present being examined by the Minister for Tourism, Fisheries and Forestry and his Department with a view to deciding appropriate action”.

They have been examining it since November 1985, which is the best part of eight months and indeed it is turning out to be a slow process. I will just read recommendation 5.4:

We concluded that the State forestry enterprise should remain within the Civil Service and should have the status of a commission. We suggest that the commission be known as the National Forest Enterprise... We considered whether the State forestry enterprise should be established as a State corporation or company or be incorporated in an existing State body.

An Leas-Chathaoirleach

I do not like to interrupt you, but could you please state the book you are quoting from?

Mr. Kiely

The Review Group on Forestry report to the Minister for Fisheries. It is rather ironic that this group suggest setting up a commission because that was like where a similar group was set up in England. They also recommend that the commission be set up. The policy in the United Kingdom has been to sell off State forestry there. One can see by the terms of our motion that we are opposed to selling off State forestry. I hope the Government are not adopting that Thatcherite policy and taking a similar line here, selling off forestry to private financial institutions.

We have no objection to financial institutions or any institution investing in forestry. There is plenty of marginal land that could be utilised for forestry and it is there to be acquired for forestry which would be a great long term development. We feel that any decision to sell off State forestries to banking or financial institutions to relieve any present Government financial position would be a retrograde step with only short term benefit at a time when State investment in the past 60 years in forestry is about to pay off. I think, as I have already said, that there is sufficient scope for the financial institutions to invest in forestry development at this time when there are up to 2,000,000 hectares in the west of Ireland and elsewhere ideally suited for afforestation.

The Irish Timber Council are also concerned about how hard it is to get timber. I have a letter here dated 30 March 1984. I am sure other Senators can get these also. Headed "Irish Timber Council", it is sent from 1 Stokes Place, St. Stephens Green, Dublin 2 and says:

Dear Senator,

I write to you on behalf of one of Ireland's most important indigenous industries and one which currently faces considerable difficulties and uncertainties. The 50 or so members of the Irish Timber Council represent 75% of the total capacity of Ireland's saw milling industry. We employ some 2,000 people and our output is valued at £26 million annually.

Our problem is not related to the availability of markets, we could sell twice what we currently produce, mostly here on the home market, and replace expensive imports. Unfortunately, however, the Irish saw milling industry is currently working at around 50% capacity because of the non-availability of raw material. The State, which operates a total monopoly on the supply of raw timber for milling can meet only a fraction of the requirement of a saw milling industry which it encouraged to expand to its current size.

As a result of a report produced by the IDA during 1981, which foresaw very rapid expansion of the native timber industry based on a sizeable increase in raw material supply, the millers here have, to date, invested some £27 million on modernisation and the expansion of capacity.

It now transpires that the IDA report was based on totally inaccurate information from the Department of Forestry. The Department included in its supply projections transmission poles and other materials which would never be available to the saw milling industry. These projections have proved to be wildly optimistic thus undermining all the IDA's conclusions. Consequently, our members, with greatly increased capacity, must run their plants uneconomically. This problem is compounded by the tendering system operated by the Department for the available timber.

There is grave concern about this same tendering system. I know that there are factories manufacturing commodities or articles from timber which have to tender for timber from their forestry. Every time they tender, they get back a letter which is delaying the availability of this timber or raw material for the commodity they wish to produce. Often it leaves them without the raw material which is necessary or the timber they require to manufacture their products. At times they have to pay a higher than normal price for the raw material or else they would have to close down. There are hurley manufacturers who experience difficulties. Hurleys are expensive and I would be concerned about the adequate supply of ash. The price of ash was £150 per cubic metre in 1981, at present it costs almost £380 per cubic metre. That is a huge increase in price. Sawmillers and the manufacturers of articles which require timber and ash are finding it more difficult to operate under that system of tendering.

I am disappointed that the Minister is not here. I have no objection to the Minister of State, a neighbour of mine from Kerry, being here. I do not see any advisers from the Department of Forestry here. This is a reflection on the subject we are discussing, which we think is most important — sorry, I am reminded that he was here.

I was at the opening of the Limerick Project Forestry Limited, which was set up by young farmers in west Limerick. They planted 37 acres at Keale, Athea, County Limerick, which was opened on 28 April 1986. The opening ceremony was to be performed by the Minister for Tourism, Fisheries and Forestry. He said:

For my part I would like to assure you that my presence here today indicates the importance which I attach to your role in the development of Irish forestry and to my resolve to effect a major expansion of the private forestry sector.

Fianna Fáil have put forward a very important motion here today. It is most disappointing that the Minister is not here to hear what we have to say and also what those on the Government side of the House have to say. I would also like to convey to those involved my disappointment that the Minister did not show up for the opening. He did arrive later for a seminar which was held in the River Room Motel but the people involved were disappointed as he had promised to perform the official opening. The importance of afforestation to the development of this country and its economy was stressed. I understand that the Minister was in Wicklow, at the official opening of a new housing scheme. I thought that would be a matter for the Department of the Environment and that the Minister should have attended to his own brief, that he should have been present at the official opening of the Limerick Project Forestry Limited, or if he could not attend himself, his Minister of State, Deputy Donnellan, should have attended to give the occasion the prestige and recognition it deserved.

Fianna Fáil are convinced that the commercial exploitation of State forests will contribute significantly to our national development. Commercial firms would be interested in buying the timber from the State and would also ensure an interest in it. Fianna Fáil will adopt a dual strategy to forestry development, create the appropriate structures to ensure effective commercial exploitation of the forests and spearhead a vigorous drive to increase afforestation. Over the past 60 years the responsibility for planting has remained overwhelmingly with the State. At present there are 3,500 hectares in State ownership.

Fianna Fáil will aim to meet a planting target of 10,000 hectares a year. It is our contention that there is a compelling case for increased investment in forestry, since only 5 per cent of our land is under trees, compared with the European average of 21 per cent. At present, the State planting programme is in decline and has not reached its objectives. There are now signs of increased farmer interest in forestry. Farmers who find themselves in difficulty because of the super-levy and who do not have their land fully developed for agricultural production would be wise to avail of the grants available for forestry. There should be some incentive by way of headage grant per acre paid to encourage them to invest in afforestation, which, in the long term, would be a viable investment and would be of great benefit to the economy in years to come.

Positive Government action will have to be taken to encourage this interest and to increase afforestation in the private sector. In this way a considerable proportion of under-utilised marginal land might be put to productive use. It is clear that with the revised agricultural structures policy at EC level increased resources will be diverted to afforestation. These resources must be fully utilised in order to get the maximum benefit from any increased Community finances in forestry development. I hope the Government will meet their commitments to the forestry development and will meet, pound for pound, the Community finances which will go into forestry development.

Serious consideration should be given to the question of income guarantees for farmers who put their land under trees. Their income should be maintained while those trees are maturing. This would be particularly useful in the case of small farmers for whom the present operating conditions of the western package do not offer sufficient financial inducement. Farmer forestry might be increased by a guaranteed headage payment from the EC for trees over the first 25 years of plantation, a view worthy of consideration. It would definitely ensure that more people remained on the land and would maintain employment in the rural areas.

Ireland's unique suitability for tree production plus our high proportion of marginal land would form the basis for a massive afforestation drive, backed by the EC in disadvantaged areas. Indeed, an expanded western package, provided the appropriate provisions are made, might well provide the basis for a countrywide afforestation drive. The co-operative approach to forestry has a number of advantages. From a social perspective it will help to maintain on the land the maximum number of smallholders. Local community groups might avail of cooperative expertise in this area to establish community forests.

I have already commended the West Limerick Project Forestry Group for acquiring land. They acquired 37 acres, for which they paid about £700 per acre, which was expensive for that type of land. They were determined that the cost would not prevent them and considered it a good investment. They set an example for other community groups. I appeal to the Minister and to his Department to encourage such groups to operate on similar lines and to plant similar areas of land. The merits of peripheral forestry, where farmers continually plant trees and still afford grazing for cattle and sheep, might also be explored by the co-operatives. This is another area, especially in the west of Ireland, where people would like to keep on a few cattle or sheep if they could plant areas which would also be utilised for grazing purposes.

The amendment mentions Building on Reality. I have that famous publication, Building on Reality 1985-1987. There are 172 pages in it. The Vote on Forestry is contrived in one page, one could say, that is, page 66, “State Forestry”. There are four lines on page 66 on this subject. There are three paragraphs on page 67, about three-quarters of a page. On page 146 the last column is devoted to it. There is only one page out of a total of 172 pages devoted to forestry. If that conveys the thinking of the present Government on forestry they do not seem to have a great interest in it.

The policy of successive Governments has been to invest in a programme of State planting with a fixed target for planting each year. This policy was endorsed by the last Fianna Fáil Government in 1982 when they set down the target for planting for the remainder of this decade. The target of 25,000 acres, that would be 10,000 hectares per year, are not being met and the objective which was agreed nationally is now in decline. Less than half of the State planting programme was undertaken last year. The present Government have shown very little interest in speeding up the programme.

Since the State was founded there has been £700-£800 million invested in State forestry. The early planting is now beginning to mature and in the next five years our output from State forests will double. We have a valuable asset which is growing in value every day. It could be of great benefit to the country and to the economy as a whole and could be great for development. This development should be undertaken by the State. State forestry will begin to mature. The output will double and it should be reinvested in afforestation. Every encouragement should be given to private afforestation and to the financial institutions to invest in forestry and to buy large amounts of marginal land that is only fit for forestry. We should ensure that we have enough timber for our own needs and also for the export market.

Mr. Smith

I formally second the proposal and reserve the right to speak.

Mr. Ferris

I move amendment No. 1:

To delete all words after "Seanad Éireann" and substitute the following:

"takes note that the Report of the Review Group on Forestry which was set up in accordance with the Government Plan — Building on Reality — is at present being examined by the Minister for Tourism, Fisheries and Forestry and his Department with a view to deciding appropriate action.

I put some thought into the amendment, as one of the co-sponsors of it and as Labour Party spokesman on agriculture, forestry and fisheries. It was because of that responsibility that I read with interest the Fianna Fáil resolution which I did not have any problems with when I read it originally. I would support it to the degree that it called on the Government to prepare and implement a plan for the maximum exploitation of the forestry resources, which is really what my amendment is saying. I accept that commitment from the Opposition Party. Senator Kiely has laid emphasis on the importance which he and his party attach to forestry. Unfortunately the remains of the resolution, asks the Seanad to call on the Government to reject any attempt by the Government to dispose of State forestry to private banking and financial institutions.

If we did not amend the resolution in the format that I suggested I would have either to vote for or against that resolution. If I voted for the resolution as it stood, it would be presumed that the Government were considering the disposal of State forests. I do not blame Fianna Fáil for presuming that to be the case because individual Ministers, and indeed Members on this side of the House, have from time to time suggested that there was nothing wrong with doing that. I want to reiterate that that was the individual opinion of Ministers. It certainly was not a Government opinion and has never been agreed by Government that the State forests should be handed over to private institutions, banking, financial or otherwise. If I voted for the resolution it would be presumed that the Government were doing that. If I voted against it I would be presumed to be doing something else, so with a certain amount of apology that is the reason there is an amendment before us.

The amendment is specific in that it recognises that the Government are considering, as a Government should, a realistic programme for the development of our forests. Senator Kiely, in quoting from the plan which was the brainchild of the Government and which dealt with all the economic areas including forestry, said that the plan itself devoted half a page or a page and a half to the subject. It triggered the actual preparation of the other document which he quoted from at length, and that is the report on the review group, which has 81 pages in it. By the look of the number of pages one could say that the Government by its national plan and by the report following the plan has devoted 82½ pages to the subject of forestry. I do not mind how many pages are devoted to it so long as Government time and consideration are given to what is, in fact, a very important segment of our economic development.

All Governments, past and present, are to be commended for the importance they attach to forestry development and on the planting and the development of our natural resource of timber. It can be said that we have never done enough. I would say that the previous Government under Fianna Fáil never did enough. Listening to Mr. MacBride, who is an authority on the subject and has on numerous occasions quoted his experiences in Cabinet of the difficulty of convincing civil servants that something should be done about forestry, must be an indication for any Government or any Government Minister that there are problems in convincing people about the length of time of payback that is involved in planting. That is the problem about forests. It is a slow payback, but from the point of national economic development there is, and must be, a responsibility on all of us in our time to ensure that there is a continuing planting programme and a continuing development of our forests. There must be a continuing level of importance placed on the end product, how it can be processed and how we can add value to it for the benefit of the country as a whole.

For that reason I would be totally against the transferring of any of this resource to private institutions, whether they are banking or otherwise. I do not want it to be inferred that this Government has at any time considered that this was what they were going to do with the forests. As I said, individual Ministers can make comments about it. I know that the Minister, Deputy Kavanagh who is with us now, has gone on public record and has given his opinion. I would remind Senator Kiely that anyone who would doubt the commitment of the Minister, Deputy Kavanagh, who comes from Wicklow, to the development of forestry cannot see the wood for the trees. He is on public record about his commitment. The fact that he did not arrive on time down in Country Clare or some place for an opening——

An Leas-Chathaoirleach

Limerick.

Mr. Ferris

Limerick — would not mean that he had lost an interest in the forestry brief. I am pleased that the Minister has been given this brief. It makes me feel comfortable because his views and mine on the development of forests would be alike. As I have said, these views have been put on the record by Mr. MacBride who has always said that we should develop our forests and we have a dynamic programme of development of our forests, particularly now when we have the processing facilities within our shores.

In my own constituency, Medite of Ireland Limited in Clonmel are now the world leaders in the manufacture and sale of medium density fibreboard. There is no doubt that with the end product they are producing and with the demand they are making on the supply of timber there is a national responsibility on all of us to ensure that that market can be met, unlike on previous occasions when there was a softboard factory in your constituency, a Leas-Chathaoirligh, which was allowed to deteriorate and go into bankruptcy but which re-opened. There did not seem to be a commitment about supplies to it. Any processing industry which develops using a natural resource like timber in a country like Ireland where there is a tremendous growth should be self sufficient in timber. We should export it and not import it as has happened in the past when, under previous Governments, we had the scandal of timber being shipped out at £1 per tonne to Sweden, processed there and brought back in by the building industry. Something had to be done about that. I am glad that Medite have dealt a blow to that particular process. They are now on the market and anxious to buy and process as much timber as they can get their hands on.

I would have reservations about the existing tendering process in the sale of timber to sawmillers and so on. It is an archaic system. It has been changed recently. Perhaps the Minister, in his reply, might itemise for us the changes that have taken place in the actual process of selling timber back to the industry.

I have demands also from people who are prepared to set up sawmills in the Glen of Aherlow. We are right in the heart of a forest area with Glencushabinne, the Ballydavid Wood and Coil na Bainseac which are all in my area. There are trees all around me. The number of people working in forestry has been declining for a number of years. I remember a time when there were 25 to 30 people working in the forest in the Glen of Aherlow. There are probably five people working there now, with one forester. That is a pity because if we had a dynamic programme of planting and forest development the amount of employment that could be created initially would be tremendous and the long term investment for the country could hardly be quantified. In 10, 20, 30 or 50 years time the value of that kind of investment would certainly pay off.

Another reservation I had when somebody suggested that we might consider disposing of forests to other people was the fact that this State, through all Governments since its foundation, has invested a lot of money in forests — not enough, but a lot of money and have improved the infrastructure in our forests to such an extent they they can be widely used now by tourists and the industry itself to get access to these forests. I would not like to see all that handed over for the sake of cash. If a State is so much in debt that it needs to sell its assets like that, then certainly there is need for some examination. That is why I am convinced that this Government particularly, having commissioned this report which is now before the Minister, would have accepted a situation where we would divest ourselves of this major industry.

The Forest and Wildlife Service have had a particular outlook towards forests. I would suggest to them that there is a new dynamic role for either themselves or another semi-State body to involve themselves with the National Development Corporation or to use the expertise that is available in Bord na Móna. Much forest land is subject to cutting-away at the moment and needs to be planted, replanted and used for growing other products. The people who are involved in Bord na Móna would be prepared to have discussions with the Minister and his Department about involving themselves in any future developments.

I have no objection whatsoever to private people getting into the area of growing trees or having private forests. Many people throughout the country do this. Some people do it as a routine part of their farm management scheme. They plant a certain amount of land that is not arable, or land that cannot be used for any other purpose. Indeed, this Government, despite criticism from the other side of the House, have given incentives by way of grants and tax incentives to people to acquire land, if necessary, to plant. There is a big difference in planting suitable land with forestry and giving grants to do this from actually disposing of existing forests which are in public ownership. That would be contrary to everything that I stand for, and I am sure the Minister stands for. Certainly the commission that have been set up to deal with this question would be totally against the privatisation of publicly owned forests and forest land. I am satisfied that that is not what this Government want to do. The amendment states that.

We are looking seriously at what we should be doing in forestry and preparing a response on foot of the major document that was based on a serious study of this industry. Anybody who has read it will realise that. It is so serious that by the time the Minister presents his findings to Government and a policy comes through to the Houses of the Oireachtas any doubts about the commitment of the Government to the State forests will be dispelled. I have no doubt but that when this report is published it will show our commitment to the development of our forests and that that commitment will result in a major economic development in the area of planting, the sale of timber, the processing of timber, of adding value at every possible level and also exporting timber, because with proper processing we have a high quality of timber. Our difficulty up to now has been that we have not been able to process it properly. People like the Swedes have been able to teach us a lot. They have a much quicker planting, cutting and processing programme than we have. They make much more use of that product than we do. There are reservations from people about using native Irish timber in the building industry. This is a fallacy, particularly with the new processing methods and the new treatment of timber brought about by the technological changes that have taken place.

I am satisfied that the Minister has a commitment to the industry and that he has a commitment to developing a proper policy which ahs been lacking over a number of years. I am sure other Senators will put on the record of the House the level of planting that has continually dropped from time to time and the increase in private planting which has happened because of grant stimulation and incentives and tax incentives. Taking all that into account there is a lot more that can and should be done by the national Parliament in the area of a vital national resource like forests, particularly on our mountainsides which are suitable for this purpose and in certain areas where it is traditional for our forests to be developed, taking into account the existing grazing rights of sheep farmers on the side of the mountains and all the covenants we have inherited. There is ample room for a new understanding of the importance of the industry. That can be matched by doing something which will convince people that this Government are committed to the development of forests and that can only be to the benefit of the country as a whole.

Minister for Tourism, Fisheries and Forestry (Mr. Kavanagh)

First, may I apologise for not being here for the beginning of the debate? Obviously I would like to have heard the initial presentations but I think I had a very worthy representative and substitute for the earlier part of the debate in the Minister of State, Deputy Moynihan. I apologise but I was meeting with a company from Fermoy and the urban council members from that town about the local Woodfab industry about which there was some concern. I was meeting that deputation and as we know when one arrives with a deputation of 20 people it is very hard to tell them to finish in half an hour as one is going to the Seanad. In courtesy to them I felt I should give them as much time as I could as they had travelled so far and wanted to tease out the problem they had and make some positive suggestions as to how their industry might survive and prosper in the years ahead.

I am sorry that Senator Kiely should have raised the point that I did not appear to be able to turn up on time for a particular function in Athea in County Limerick, a function to which I was very happy to go. I phoned and explained that I was going to be late and I understood that that apology was accepted. I had the alternative to ask a Minister of State to attend instead of myself, but I felt that I should go on and attend the meeting. I arrived there at about 5.30 p.m. and left at about 11.45 p.m. and everybody seemed to be happy with the amount of time I gave to the meeting.

Mr. Kiely

It was disappointing for the people concerned.

Mr. Kavanagh

I did not get that impression when I was there. No such disappointment was expressed to me either by the Senator or by anyone else there. I stayed on for a seminar to make up for any lost time although I had not intended to stay on.

I congratulate everybody connected with that. I think they were very happy with the job they had done and with my presence to ensure that it got the blessing from the top and that I had made a real effort on a difficult day. No one can say when a funeral happens, though that is not the excuse that was put forward here in the Seanad. Such matters arise and those of us who are constituency Deputies as well as Ministers have to react on those occasions.

The House will be aware that in accordance with the Government's Economic Plan Building on Reality, my predecessor, Deputy O'Toole now Minister for Defence, established in November 1984 a review group on forestry to examine the structure, organisation and operation of the Forest and Wildlife Service of my Department. The reason I might add, for this review was not because of any preconceived ideas about the structure of the forest organisation as such but simply because forestry which is one of the great economic and social achievements of this century had reached a stage of development where it was considered timely to appraise its role for the future — with a view to developing and exploiting the asset to the best national advantage particularly in view of its importance in industrial development, job maintenance and timber import substitution.

My predecessor when establishing the review group stressed to them the importance of making an objective assessment with the national interest taking precedence over any sectoral considerations and with due recognition being given to the objective of achieving a fair return to the taxpayer of the very substantial investment in forestry down through the years.

As the House knows the review group submitted their report in November last and I have no doubt you will all agree that not only does it contain a fair measure of objectivity and balance but is a testimony to the many long hours devoted by the group members to an indepth examination of this very technical and complex area of economic activity. I am confident that the work put into it will contribute significantly to deciding any necessary changes to make even more successful this very worthwhile enterprise.

The report identified the varied activities and functions carried out by the Forest and Wildlife Service in the areas of forest establishment, forest research, production and sale of timber; creation and use of amenities such as forest parks and forest walks; wildlife conservation and game development. It recognised the desirability of separating the commercial from the non-commercial activities and suggested the creation of an organisational framework in which both of these diverse interests could prosper and particularly in which the commercial activity would be free from political and sectoral pressures.

To this end the review group recommended the establishment within the Civil Service of a National Forest Enterprise under a director general and a board of management which would report directly to the Minister. They recommended also that the new body should be responsible for carrying out the private forestry programme. The non-commercial and social forestry activities such as wildlife conservation, game development and amenity would remain the responsibility of my Department which could contract with the NFE on the maintenance and management of such activities.

Before going on to deal further with the review group's report I would like to take the opportunity of allaying the fears of some Members — as implied in the original motion to this House — that the Government are involved in or planning to sell off State forests to private financial institutions. This is simply not true. At no time have this Government attempted to sell State forests to private financial institutions and there are no negotiations in train with any institutions or organisations to do so at present.

This misconception arose originally from an inquiry by the media to my predecessor to comment on a suggestion made by the Chief Agricultural Adviser of Allied Irish Banks in the course of a paper which he read to the Agricultural Science Association annual conference on September 12 about the possible investment of private pension funds in State forests. In reply the then Minister made it quite clear that a decision on any such proposal, which represented a fundamental change in policy, would be a matter for the Government. He emphasised and I re-affirm now that the Government had made no such decision nor was any particular proposal in that connection being considered by them. As Minister with responsibility for forestry I must, of course, be prepared at all times to examine and consider any proposals made to me by outside interests in relation to investment in or funding for forestry and, if in the national interest, to refer the matter to Government for their consideration.

I must say, however, that proposals to involve the private sector in the State forestry enterprise in this country have been made from time to time in the past. The suggestion is not, therefore, new. I wonder for example if the Deputies who signed this motion realise that the Fianna Fáil Government in 1981 introduced the concept of privatisation of State assets in their Investment Plan for 1981 and that the then Minister for Finance in his budget speech on 28 January mentioned a sum of £200 million as being the target to be realised on privatisation for that year? Are they aware that the then Minister for Finance saw the State forestry sector as an area that could make a contribution to that target of £200 million and that the then Minister's Department in 1981 contacted a number of investment agencies with a view to exploring the possibility of involving investment by the private sector in State forestry?

However, that being so, I can now assure the House that while there might be merit in considering investment of pension funds in the produce of plantations — thereby making scarce financial resources available for other needs for example, the acquisition of more land for forestry — I would be totally opposed to the complete sale of blocks of State forestry inclusive of the land and I can assure the House that no such sales are contemplated.

As indicated in their economic plan —Building on Reality— the Government are clearly committed to ensure that State forests are developed to the maximum national advantage and to this end are committed to a State forest planting programme for 7,500 hectares a year which would, of course, be supplemented by private forestry. In this connection I would like to remind the House about the attractions of Ireland, because of our natural advantages for forestry investment. Our forests yields on average a third more timber per year than forests in Britain and up to four times as much as those in other European countries. Nevertheless, despite our natural advantages for tree growing, Ireland regretfully has the lowest percentage of its land under forest of any country in the EC — 6 per cent as compared with more than 20 per cent in the Community as a whole.

In Ireland, the State owns by far the greatest part — 85 per cent — of the total forest area and has invested more than £1 billion in current money terms, in establishing some 800,000 acres of forest. While we can be proud of this achievement I am disappointed that the private sector has not made a greater contribution to the national afforestation programme. However, I believe that we are about to see an expansion in the area of forest crops planted by the farming community. Serious problems have arisen for farmers engaged in the production of the traditional agricultural commodities in oversupply leading to the adoption by the EC of corrective measures or restraints on production of commodities such as beef or milk products. In the light of these developments farmers will have to examine alternative or additional lines of production such as forestry, in which they can more profitable become engaged.

There is a growing acceptance that much of the land classified as marginal for agriculture — 40 per cent of the land in this country — could profitably be devoted to forestry. There is an abundance of land in the west for which afforestation would be the most appropriate form of use. Assessments of future timber requirements by international organisations show that there will be no shortage of markets for the output of our forests.

I have no doubt that the vigorous promotional campaign undertaken by my Department last year will lead to greater interest in the development of our forestry potential. These efforts, and the generous grants available under the western package of up to £800 per hectare, are now beginning to bear fruit. As evidence of this I would point to the fact that some financial institutions have already considered forestry as a sound investment and have invested part of their pension funds in forestry. This surely is evidence of the viability of forestry as an investment medium. I am confident that the lead given by such institutions will in time result in forestry becoming a real alternative option for land use by the agricultural sector.

I am pleased also to inform the House that only last week I was happy to officiate at the opening of a community forest in County Limerick — a project where a group of local people banded together to form a company to purchase and plant almost 40 acres. This development in cooperative forestry will I hope be followed by other groups in this country and thus help in expanding the private forestry base.

The review group have identified problem areas within the Forest and Wildlife Service such as the size of the management structure, poor communications, political and sectoral pressures etc. and while it has suggested a revised framework and organisational structure in which a new body such as a national forest enterprise could operate I would remind the House that it would be remiss of me merely to adopt the review group's recommendations without first ensuring that they would result in effecting the desired changes and benefits. Accordingly the group's recommendations are being examined currently in detail by my Department and I have also sought the views of various interested organisations thereon with a view to deciding on the appropriate action to be taken. While I am not in a position at this stage to say what decisions will be taken, it is my aim to do so as quickly as possible.

I must of course, be satisfied that any changes necessary are made for the general good of forestry, the timber industry and the nation and not merely in response to particular criticisms from vested interest groups. It is important for the House to be aware that the main problem facing the entire timber industry is not so much structural organisational changes within forestry but rather the imbalance that exists between total availability of the timber supply and the current overcapacity in the industry. This problem is not attributable directly to any deficiencies within the forest service itself but rather is the result of the fragmented pattern of acquisition and planting in former years and will only be remedied with the maturing of such crops in the next decade. While the percentage of domestic market share being met by home produced timber has increased from 13 per cent in 1979 to over 40 per cent today there is still a sizeable gap to be met which will not be resolved until the late nineties when we will be self sufficient. As will be seen then we have made considerable progress — and I am afraid I cannot make trees grow any faster — nevertheless an imbalance between supply and demand will continue to exist for some years hence. The Forest and Wildlife Service have the difficult task of trying to effect as equitably as possible the distribution of the available timber and many of the criticisms levelled against them on this issue are often not justified. Despite these criticisms of the Forest and Wildlife Service the House should be aware of the considerable achievements of the Forest and Wildlife Service since the mid fifties. The State forest area is now close to 1 million acres; annual production has risen from a mere 13,000m³ in 1950 to 1.3 millionm³ in 1986 and will exceed 3 millionm³ by the next 15 years. As I have said Ireland will be self sufficient in softwood needs by the late nineties with sizeable surpluses for export to the EC where markets are assured.

Here I would like to refer the House to the very valuable work carried out by this service in what I might describe as social forestry, namely, the development and maintenance of amenities for the enjoyment and education of the public at large. I refer, of course, to the great work done by the service in the past fifteen years through its open forest policy in establishing 11 forest parks and over 400 walks and nature trails.

This is an aspect of the Department's work with which we all can feel proud. The many fine parks and walks are a great source of relaxation, education and pleasure for well over a million people each year. It is no wonder some people indeed think that the provision and upkeep of such amenities constitutes my Department's only work. It is a tribute to all in the Department that despite the burden of their principal function — the development of forests and production of timber — they can still manage to create such a heritage of amenities within their forest estates. Such, of course, not only attract our own people but hopefully will be a source of pleasure for an increasing number of tourists.

I am pleased also to tell the House of two further developments in the amenity area with which my Department are associated. The first of these is the development, in association with Cospóir, of a continuous walk extending right around this country and going through many of our State forests. When completed this walk will join up with a similar walk — The Ulster Way — being developed in Northern Ireland to form an all-Ireland walk.

The second is the development of a holiday chalet complex in Killykeen forest park in County Cavan. This will consist of 20 uniquely designed three and two-bedroomed chalets in a forest-lake-side setting with individual views of Lough Oughter. These chalets are constructed with Irish timber and all materials used are of Irish manufacture. The development which cost close to £2 million was funded chiefly from EC funds under the special Border Areas Programme to provide amenities in Border counties. The complex which will greatly enhance the tourism potential of County Cavan is expected to attract many visitors from Northern Ireland and Great Britain. It will in addition, be a haven for many British and continental fishermen.

Finally in detailing the work of the Department let us not forget the valuable work carried out in the conservation and game development fields. In the Wildlife Act of 1976 we now have one of the most enlightened Acts in Europe on the conservation of flora and fauna. This area despite financial stringency has succeeded in establishing many wildlife habitats which will be havens for a variety of flora and fauna. The Department also continue to give advice to and help many game councils around the country in the rearing and development of game — another amenity of benefit to our tourists.

Indeed, it is no wonder the review group itself recognised the considerable contribution of the Forest and Wildlife Service when it said "The FWS has built up an important national asset, achieved profitability of up to 2 per cent over inflation and provided highly valued recreation and amenity facilities."

In summary, therefore, the existing forest service has built up a substantial renewable resource which I have no doubt will increasingly make a significant contribution to employment, Exchequer revenue and regional development.

The House will, I trust appreciate that, given the considerable future benefits from forestry and conscious of the requirements of the timber industry and also the need to achieve a harmonisation of policies in regard to commercial and non-commercial functions, it is important that whatever changes are effected are such as will achieve the desired results. The House will also understand that changes in the status or structure of the forestry organisation will be a matter for decision by the Government in due course and the present examination of the review group's report and recommendations is directed with that end in view.

I was asked by Senator Ferris about changes that had taken place in the tender system recently and I would just for his information say that following the interdepartmental committee report on the sale methods, the sales were modified by the inclusion of auctions of which we hope to have two or three this year by a quota system for enlarged saw logs. This quota system will make available about 40 per cent of the two previous years allocation to particular mills who deal in that type of large saw log timber. Thirdly, more sales of processed material will be made available at roadside during the year. These are the changes I think he considered at the time.

I think I have covered the full activities of my Department and the possibilities for change in that Department. I would hope that the House would accept the amendment which is down to the motion proposed to the House. I have clarified the points of interest to the Senators. I would hope that we would have a unanimous agreement to accept that amendment.

Mr. M. O'Toole

I am glad to get the opportunity to say a few words on this motion and to support our spokesman, Senator Rory Kiely. The only thing about the motion is that it is outdated since it has been on the agenda for so long. To put the record right, the Minister knows that this motion was put down because we were all scared by the suggestion emanating from Barrettstown by the then Minister for Finance, Deputy Dukes, that matured forests could be sold over to banking institutions and insurance companies. At that time we were scared that this might happen. As to the Minister's reference to the 1981 statement from this side of the House I just want to say to the Minister that that did not happen. A statement was made that housewives were to get £9.60 a week. That did not happen either.

An Cathaoirleach

The Senator is getting far away from forestry now.

Mr. M. O'Toole

I am getting away from forestry but I will get back to it in a minute. If anyone wants to be political about statements that have been made, then we can all become political. It is a serious position and I do not want to get political about it. I can have a cut at that side of the House as well if it is necessary to do so. Since the statement I refer to did emanate from Barrettstown it behoved the Minister and the Leader of the Labour Party to make a statement on policy. I am glad to hear that the Labour Party are not in favour of the sale of matured forests to any private enterprise. I would go along with that thinking. I see nothing wrong with selling off, if we have acquired sufficient land, some land for the development of forestry to semi-private or financial institutions for the development and planting of forests. In order to retain the 10,000 hectares of planting, you require at least 30 to 40 hectares of a pool so that you can plant roughly 25,000 acres per year. That was the target that was achieved from 1960 to 1965 and again from 1972 to 1974. That should be the target of future Governments if we are to develop afforestation in a serious way.

It might be all right to welcome the plan for private afforestation but a recoupment period to either a group of farmers or farmers individually or a company of over 50 years is too long in the case of private planting. While private planting may be encouraged, the main thrust must come from our experts in the forestry and wildlife division. The have the expertise, the experience, the equipment, the nurseries and they know the adaptable species for the various areas, coastal or inland. With the variation of soil, it is necessary to know the suitable species for each location.

There is the great potential of afforestation to provide employment. I would ask the Minister to state the number of ESB poles being imported and the extent to which demand is met by native forests which should have reached the stage of maturity as to supply the ESB with poles. Have the necessary preparations been made to provide the ESB and Bord Telecom with poles? I understand that we were importing all the poles required for the ESB and Bord Telecom. I would like to know from the Minister if that has changed over the years.

There is room for further processing of afforestation. I am glad to hear that the deal we had abroad whereby we had to export timber at a nominal fee has terminated and that we are now in a position to process that timber here. This is important. The processing of timber which provides employment in this country should be the aim of Government.

I am glad to note from the Minister's reply that he is conscious of the desireability of further development of forest walks through natural forests and the forests that have been planted. Such walks are a tourist attraction. They can be especially useful as a tourist attraction in areas which have no seaboard or lakes. Countries which have not got the natural scenic beauties we have here use afforestation and forest walks as tourist amenities. This aspect of afforestation could be developed further. I come from an area where there are dense forests. I have seen developed walks through these forests, which are very attractive.

I should like the Minister to inform the House if we are importing poles for the ESB and An Bord Telecom.

An Cathaoirleach

This debate concludes at 8 o'clock this evening. It will be resumed, I suppose, next week. There is still one and a half hours left on it.

Mr. Loughrey

I thank Senator O'Toole for being as brief as he was. My own preparation may render me more brief than I had anticipated.

There are a few points that I noted on the proposal by Senator Kiely. He talked in the absence of the Minister whose absence has been explained and which was unavoidable. I am glad that his own side of the House has now been strengthened by Senator O'Toole coming in and by the Leas-Chathaoirleach joining him. Otherwise the benches were rather bare.

Mrs. Honan

Do not underestimate us.

Mr. Loughrey

I never did. Might I refer the same Senator to table 4, page 23 of the report where it referred to the commitment by various Governments. I note the drop between 1979 and 1980 of planting from 8,214 to 6,613 the biggest single drop between 1974 and 1984 and to table 3, page 16, where the amount of money spent in 1973 was £8.63 million and in 1983, the last year for which figures are available, £45.04 million. Those figures speak for themselves.

Mr. Kiely

In 1973 and in 1983 we had Coalition Governments.

Mr. Loughrey

I was pointing to the increase between 1973 and 1983.

The motion reads:

"That Seanad Éireann calls on the Government to prepare and implement a plan..."

That is being done. The Government asks in Building on Reality that this review group be set up. The review group has not only been set up but have reported.

The motion goes on to read:

... and rejects any attempt by the Government to dispose of State forestry to private banking and financial institutions."

As the Minister has said, the first reference to possible involvement of such financial institutions was made by the former Minister for Finance in 1981 in his budget speech. Having said that, I am not sure that the involvement of private banking or financial institutions or money from private sources of necessity is a bad thing. I am not so sure that it is wrong that the assets of the country should be starved because of lack of finance. There are, of course, a number of criteria that would need to be met before I would support such involvement of private finance. One would be replacement of assets as they are used or destroyed — and I use this word guardedly, secondly, that it would not be necessary for the State to dispose of the lands on which our forests are grown in order to introduce private finance into the development of forestries. If some of our natural resources are to be developed and if the State does not have the resources required to develop them — and all the indicators are, in regard to assets that we have, including forestry, that the State has not been able to develop them fully — it is only right that we should invite other interests, private or otherwise, to invest in them.

The terms of the motion are panicky as a result of a notional idea that the Fianna Fáil Party got of the intentions of the Government at that time. The Minister has spelled out very clearly that the Government have not taken any decision in that direction. I, as a Senator, ask the Minister to consider private investment under the terms I have suggested.

There is nothing implicitly wrong with using that type of finance. I address these remarks particularly to the other benches: I would prefer involvement by Irish bankers and Irish financial institutions to selling out our assets to foreign bankers and to world banks as was done over a period of Fianna Fáil Governments.

I should like to put a positive proposal to the Minister for his consideration. It is clear — and the Minister makes reference to this in his address to the House today — that something serious is happening in the agricultural scene in Europe, perhaps in the world. Certainly in Europe we have over produced in almost every commodity. The evidence of this is the recent cutback in milk, beef and so on. The small farmer along the west coast is under severe pressure. He is under pressure from another source. I refer to the small farmer who is in receipt of unemployment assistance. As a result of a court case that we are all only too familiar with, those small farmers have to produce factual evidence of their income, the income being the total income less their expenditure. They are almost the only farmers in Ireland who have to keep accounts of their profits, which are then called means and assessed against unemployment assistance or dole. The logical conclusion is that that farmer is being penalised for every £1's worth he or she produces on the land. For every £1,000 worth he produces, his unemployment assistance will be cut by approximately £20, or for every £2,000 worth, £40. There is a net disincentive to the small farmer along the west coast to produce at all. There is the slow pay back from afforestation undertaken directly by farmers. The Minister and his Department should apply themselves to the question of providing a method whereby that farmer could move from normal agriculture as we know it. I feel that if the Minister and his Department applied themselves that some method might be arrived at where that farmer could move from normal agriculture as we know it into, what I have seen described in this book as silviculture.

Debate adjourned.