Vol. 115 No. 6
I move:
That Seanad Éireann approves the following Regulations in draft:
Agricultural Produce (Fresh Meat) Act, 1930, (Exporter's Licences) (Fees) (Amendment) Regulations, 1986, and Pigs and Bacon Act, 1935 (Part II) (No. 12) Regulations, 1986,
copies of which were laid in draft before the Seanad on the 13th day of November, 1986.
These regulations would reduce on a temporary basis the fees payable for pigs presented for veterinary inspection under the Pigs and Bacon Acts and the Fresh Meat Acts from their present level of 75p down to 50p per pig. With the approval of this House, I would hope to have these reduced fees made effective in the period from 1 July 1986 until the implementation of proposed legislation. The Bill, with regard to local slaughterhouses is presently being drafted and is hoped to be taken early in the new year on local slaughterhouses but, in any event, not later than 30 June 1987.
Under the slaughterhouse legislation which I have referred to, it is proposed to harmonise inspection standards and charges as between domestic pork and other slaughterhouses and export plants, thus removing competitive anomalies between both types of premises. It is hoped to have the necessary draft Bill introduced shortly. There is the big complaint all the time with the major slaughtering operations that you had these local pork people who were not contributing in any way towards levies.
The whole question of veterinary inspection fees on pigs has been a matter of concern to my Department for some time. This fee is a statutory charge for a service provided by my Department's staff at approved export pig slaughtering plants. Between 1982 and 1985 the majority of curers had been refusing to pay these fees, leaving arrears of almost £5 million for that period. The plants had claimed first that the fees were too high and, secondly, that they were at a competitive disadvantage on the home market since domestic slaughterers did not have to meet the same inspection charges and standards.
Following detailed negotiations between my Department and the Irish Bacon Curers Society Limited, last year, and conscious of the difficult market conditions being experienced by the industry, I agreed to reduce the fees from their then level of £1.10 to 75p per pig and also to bring in fresh legislation on domestic slaughterhouses. For their part the pigmeat plants agreed to the resumption of payment of the new fees. Regretfully, I have to report that, despite an initial resumption of fee payment, the majority of curers have again discontinued payment, leaving an amount of £1.3 million outstanding since 5 April 1985.
Senators will appreciate that the reduction now being proposed which, taken together with last year's reduction, means a fee of less than half the 1985 level, represents a very generous initiative indeed. The amount being charged now is well below the cost of providing the service and the industry must respond positively and honour its agreement on this matter. Hopefully, it will do this voluntarily. I must indicate very clearly, however, that if it does not do so, I will be forced to take very strong action against defaulters, action which could result in their export licences being revoked. I appreciate that the pigmeat industry has been experiencing some difficulties. Increasing competition on home and export markets has created problems for some firms. However, other industries in our economy are facing similar problems, but are meeting their obligations. The pigmeat industry must do likewise.
In an attempt to help the industry, I have already taken several measures aimed at improving the situation. Included among these are the extension to pig producers of the scope of the recent exchange rate guarantee scheme for short term working capital for farmers and, indeed, the lifting of the ceiling of £50,000 for pig producers. The proposal by the EC Commission to extend the 50 per cent FEOGA grants currently available to pigmeat projects in the disadvantaged areas to the rest of the country — where the present rate of grant is 25 per cent — will also be of great help. It is of great help particularly when you consider that some of the major operations are outside the disadvantaged areas. I have already mentioned the proposed legislation on domestic slaughterhouses which will standardise fees and inspections at factories whether they be slaughtering for the home or export trade. The proposal to reduce the fees is a further positive measure of aid.
The pigmeat industry will now have to tackle the serious structural and organisatonal weaknesses which exist if it is to be able to meet the challenge ahead. For some time now we have emphasised the need for rationalisation of pig slaughtering plants and modernisation of processing plants. While there have been some hopeful developments on this front, much more has to be done — and done quickly. Generous aid is available for this purpose to the right applicants. If firms modernise their plants to the highest standards, they will have new markets open to them such as the US market from which they are now excluded. Firms also need to concentrate much more on product development and on aggressive marketing.
It is true to say that Irish bacon has been doing badly on UK markets chiefly because we are not producing what the market requires. The general complaint coming back from the British supermarkets has been that our sodium content is too high, our salt content is too high, the fat content is too high. We have some very good entrepreneurial people coming into the market remedying that situation. If we are to take this massive market seriously, we will need to have a quality food product not merely for bacon but for all our food products entering these markets. I have been assured by the supermarket owners and by their boards of directors that we do not even need sales people if we can come up with the quality they require.
Product quality and consistency are vital for effective competition. With this in mind my Department are working towards the early introduction of the recently agreed EC pig grading scheme under which carcases are graded by reference to lean meat content. I hope that the House will support the draft regulations now before it and also support me in calling on all involved in the pigmeat industry to tackle the urgent tasks now facing it in order to ensure that it will continue to play a valuable role in the Irish economy in the years ahead.
Before I conclude I would like to indicate to the House that there was some question raised in the Dáil about the skim milk subsidy. We have at present a subsidy of approximately 42p a gallon. This means that skim milk is available at 10p per gallon. Another point that comes to our notice in the Department is the United States market. We are looking forward to more than one processor gearing up for a USA licence. Undoubtedly, the United States market is there. There is absolutely no access to that market unless we bring our slaughtering into line with USA standards. I gather that at least one if not more of our processors is getting ready for that scene. Our permanent food committee, which involves all the State bodies, including CBF, devoted much time recently to the pigs and bacon industry. Shortly, we will be visiting some of the plants and finding out at first hand where the State can help and where the industry can help itself. During a recent tour by representatives from the Commission with a view to making FEOGA grants available some of our shortcomings were highlighted.
