The amendment to the motion inadvertently appears to motion 22 on the Order Paper; it should appear to motion 23. The overall time limit for the debate is two hours. Notwithstanding anything in Standing Orders, the time limits are as follows: speech of the Minister of State, 15 minutes; speech of proposer of the motion, 12 minutes; speeches of other Senators, eight minutes and there will be five minutes for the proposer, or another person nominated by him, to reply.
Ewe Premium System: Motion.
I move:
That Seanad Éireann calls on the Minister for agriculture, Food and Forestry to honour his commitment to obtain changes in the method of calculation of the ewe premium payments which will end the discrimination against Irish sheep farmers.
I welcome the Minister of State. This debate is important for many farmers involved in sheep production, the agriculture sector and the economy as a whole. Sheep farmers are not happy and are anxious that the Minister honour his commitment to obtain changes in the method of calculation of ewe premium payments. Such changes would end the discrimination against Irish sheep farmers who are extremely disappointed that the Minister appears to be allowing the EU Presidency slip by without tackling the policy problems that relate to sheep production. He should be more proactive in an area where there have been serious difficulties, particularly in view of the fact that Ireland currently holds the Presidency of the EU.
In 1980, Ireland gained access to the French market and the ewe premium was introduced. This was paid on each ewe in Ireland and in the UK it was paid in respect of lambs. At public meetings, the Minister referred to the fact that a policy mistake may have been made when we sought the premium on ewes rather than lambs. It is important to point out that, at that time, there were only 1.5 million ewes in the country. Many of these were located in disadvantaged areas and did not attain the lamb ratings now available as a result of improved husbandry and breeding practices. It was clear that, if we were to build a sheep industry in Ireland, the provision of the ewe premium was manifested in the accelerator which allowed for an increased breeding flock.
Throughout the 1980s there was a major expansion in the breeding flock and the herd increased to 4.6 million by 1994. Much work was done in the processing sector to develop the infrastructure which would allow us to provide the type of carcass lamb and carcass sheep meat to give Ireland increased market share in Europe. The majority of this work was carried out with the assistance of FEOGA grant aid.
Since 1991, the CAP has been reformed in respect of sheep and a quota régime introduced. With the full support of everyone concerned, a ewe premium calculated across the European Union rather than on an island only basis, where each member state would carry out its own calculations, was also introduced in the belief that Irish prices would rise to meet French prices. In other words, there would be convergence in relation to prices and the ewe premium would be the support mechanism uniformly applied at every level throughout the EU. Experience has shown that theory does not work as far as Irish sheep producers are concerned.
In 1992 there was a collapse in lamb prices; in 1993 and 1994 they remained static and in 1995 they decreased to the tune of 9 per cent. Prices have increased during the current year but the consensus is that this might not obtain in the future. The BSE crisis is probably a factor because people began purchasing lamb as a substitute for beef. That is changing, however, and the position might be reversed. Lamb skins cost much more this year with prices rising by as much as £10 per skin. That is not sustainable.
I stated on previous occasions that the Minister and the Government are indifferent to the problems of sheep farmers and the sheep industry. Proof of this emerged last December when the Minister announced an alleged package for sheep farmers in disadvantaged areas to critical acclaim. His declared promise that a £2 per head increase in headage for ewe hoggets in disadvantaged areas and a £1 per head for mountain ewes in the most disadvantaged areas would be paid was not honoured until November. It is a disgrace that the Minister did not fulfil his promise by paying these increases immediately. The increases were to be paid last December but this did not happen until last month and they might not have been paid at all had the Fianna Fáil spokesperson on Agriculture, Deputy Cowen, not pressured the Minister into doing so.
The Minister's action in delaying such payments is unprecedented and scandalous. He should be held to the promise he made in November 1995 that there will be a full review of the EU sheep policy during the Irish Presidency. During Private Members' business in the Dáil on 7 November 1995, the Minister stated:
My difficulty is — obviously that of someone who has the responsibility of negotiating this package; it is not one of the Opposition because they do not have that responsibility that to change the method of calculation requires the Commission to propose it and be accepted by a qualified majority.
In respect of European Union voting procedures he stated:
I do not want to mislead anybody on this issue but, frankly, no other member state of the European Union will vote with Ireland on the issue of changing the method of calculation
.... We have three votes. Leaving aside the fact that the Commission will not propose a change in the method of calculation, I can say that, if there is any prospect that I can use our Presidency in 1996 — as part of the review referred to which may be carried out in the first half of 1996 — I will seek to have it as my absolute top priority so that it will incorporate the points made on price convergence.
The Minister is now in the winter of his term as President of the EU Council of Agriculture Ministers and what action has he taken? I do not wish to reflect on the character of the Minister of State, but why is the Minister not present to provide answers?
I will answer for him.
Senator Kiely to continue without interruption.
I did not provoke the interruption. What has the Minister done? He has dodged the issue and ignored the plight of sheep farmers. The present system of calculating ewe premium payments discriminates against Irish sheep farmers who are facing a reduction of over £5 in such payments this year; this will dent their incomes severely. This has occurred because prices throughout Europe have increased. Such a reduction will cost the Irish sheep sector £23.5 million, a loss of £500 for every flock owner. That is a great amount of money.
As President of the EU Council of Agriculture Ministers, the Minister had a unique opportunity to push for much needed changes in the ewe premium and the abolition of the stabiliser mechanism. He gave a clear commitment to sheep farmers last November that he would use his Presidency to carry out a full review of the sheep sector. Sheep farmers and Fianna Fáil will be insisting on full delivery of this commitment before the end of the year. The Minister has very little time because there are only a few more weeks left in 1996. Will the Minister of State convey this to the Minister and ask him to take action?
It is important that a top up ewe premium be paid to producers in any EU state where the average annual price is more than the specified percentage below the average EU price in a particular year. This premium would amount to the difference between the average EU premium and full income loss compensation in the member state concerned. For Irish sheep farmers this proposal would add an extra £3.47 per ewe premium payments in 1996.
It is also essential that the 7 per cent stabiliser mechanism be abolished. With ewe premiums throughout the EU on the decline and the strict production quotas in place since 1992, the 7 per cent stabiliser mechanism serves no purpose other than to deny producers their full ewe premium entitlement. This policy change would add a further £4.68 per ewe to the EU premium.
Policy changes are also necessary in other areas, such as the permanent extension of the rural wool premium to lowland producers, earlier ewe premium application dates, a strict ceiling on EU lamb imports and an extensification premium for sheep. I appeal to the Minister of State to convey to the Government that sheep farmers in Ireland are not happy with what the Minister for Agriculture, Food and Forestry is doing for them. The Minister promised a review of the system and I appeal to him to do so immediately.
I second the motion. I welcome the Minister of State and, coming from County Kerry, I am sure he is well aware of the problems sheep and hill farmers are facing there.
They are thriving at the moment.
I doubt they are if the stabiliser clause is as effective there as it is in my part of the country. Senator Kiely has outlined everything very well. The stabiliser clause was introduced when the EU was trying to introduce quotas. The quota is now well established and there is no need for the stabiliser clause which militated against farmers because for every 1 per cent they were over the quota they suffered a cut by 3 per cent — in reality this worked out at 7½ per cent — and it is still in place. A farmer with 100 ewes is losing £425 per year. That is a lot of money to a small hill farmer. The Minister gave a commitment to abolish this clause when he took over the EU Presidency. We are now in the last few weeks of his term and it has not even been discussed. If the Minister had this clause abolished he would go down in history as having done something positive for sheep farmers so that they would get their full subsidy.
I move amendment No. 1:
To delete all words after "That" and substitute the following:
"Seanad Éireann supports the actions of the Minister for Agriculture, Food and Forestry, in his efforts on behalf of Irish sheep farmers in regard to his efforts to secure changes to the Ewe Premium System."
I want to congratulate you, a Chathaoirligh on achieving such high office. I wish you well, I have no doubt you will carry on the great tradition of your family. I welcome the Minister. Every time we see him things are getting better and, as far as the sheep industry in concerned, things are considerably better.
I welcome this debate. Never in the history of the State has there been so much optimism in the sheep industry. I have no doubt that the efforts of the Minister, the Minister of State and the Department in the past two years have brought about this situation.
Not all of the problems of the sheep meat industry are caused by external factors. There are weaknesses in the industry which we need to remedy. A greater effort needs to be made to achieve more consistent quality. For this reason the Minister requested An Bord Bia to carry out an in-depth analysis of the different aspects of the Irish sheep industry. This report is now available and should be the basis for formulating a strategy for the period ahead.
However, a number of things are already clear. Irish producers are most vulnerable when it comes to the quality and consistency of our product. The French market, on which we are so dependent, will penalise us for a poor quality product. If we do not produce exactly what the market demands there are many competitors who will step in, as they have done before, and take our market share. With a predominantly export trade and a difficult market, quality becomes all important. Quality, convenience and value for money are what the consumer wants.
For too long too much of our throughout has consisted of over fat meat because producers get better prices for a larger lamb. This is detrimental to the industry. Optimum quality must be the primary objective of all those involved in the industry. Dry hoggets are not in the interest of the Irish sheep industry especially when they come on the market close to Easter and depress the price of spring lamb. This happened in the 1994 season.
A working classification system which rewards the producer for quality is crucial for achieving higher standards in Irish lamb production. The critical point is that such a system is workable and effective. A voluntary system stands a better chance of being effective. I understand progress is being made on this issue. The intention is that carcass classification will become standard practice. The logic of this system is that processors pay for lamb on the basis of quality, otherwise producers will not have an adequate incentive to produce the right quality lamb. The reverse will also apply and poor quality lamb will have to be penalised. I am well aware of the ability of Irish farmers to recognise that it pays to produce quality products and it is clear that this change will deliver effective results.
I am pleased that prices have increased considerably in the last six months. Since May 1996 prices have increased by an average of 20 to 25 per cent more than the corresponding period in 1995 and 40 per cent higher than in 1994. This means that some producers have done reasonably well this year. The improvement in prices has made it more difficult to negotiate a special deal for our producers because other Ministers in the Council will be faced with the difficulty of explaining to their producers why special measures should be introduced for Ireland, particularly at a time when we are doing so well as far as prices are concerned.
I am disappointed that Senator Rory Kiely said £2 would make such a difference in a herd of 100 ewes. It would make a difference of approximately £425. Currently a farmer with 100 ewes should produce approximately 150 lambs for sale He is getting £20 more per lamb than he got in 1995, which will give him a gross increase of approximately £3,000 for his lambs. Nobody can dispute those figures.
This is not the time to go to Brussels to make a case on behalf of the Irish farmer. A case can be made only when matters are in extreme difficulty. I am prepared to accept that sheep farmers in 1991, 1992, 1993 and 1994 had a difficult period. However, this has levelled out. The Minister must keep the pressure on to maintain quality. We depend on the French market. There are so many prepared to take our market and produce good quality lambs. New Zealand, American and Australian lamb is not good quality but the English can produce a very good quality lamb. In the present difficult period as regards beef, lamb is fulfilling an important role. I am glad sheep farmers are reaping the benefits.
The motion before us does not fairly or accurately reflect the efforts or the progress which both the Minister and the Department have made in the course of the past year. In response to the difficulties being experienced by the sheep meat sector, the approach has been proactive and energetic. The efforts made have been successful in introducing measures which have restored stability and confidence to the market during 1996. I commend the amendment to the motion to the House as it is a true and accurate reflection of the situation.
A Chathaoirligh, I also congratulate you. This is the first time I have been in the House since you were elected. If you are as successful as Cathaoirleach as you were as Chief Whip for a minority Government, we should have a smooth time in the Seanad until the next election.
The sheep industry is more important than ever in Irish agriculture. Whatever changes in the form of payment of the ewe premium scheme or headage payment are sought or made by the Minister, will he take into account the recommendations of the Environmental Protection Agency in its excellent report, Water Quality in Ireland 1991-1994 regarding the need to recognise the serious effects of overgrazing on the quality of water in Ireland?
Section 2 (28) of the report states:
A relatively recent phenomenon causing grave concern is the severe environmental degradation resulting from overgrazing by unsustainable populations of sheep in the west of Ireland. Considerable areas of upland commonage have been denuded of vegetation and the ensuing peat and soil erosion has led to siltation of lakes and rivers, the development of peat and algal complexes on river beds and increased peat staining and turbidity of waters. The loss of vegetation and subsequent erosion of peat cover profoundly alter hydrologic characteristics of mountain boglands by reducing their capacity to retain and slowly release water. Rivers and streams then become more prone to drying out and to flooding, and as a consequence, to scouring, siltation and substratum instability. The ensuing environmental disruption causes a loss of biodiversity, damages salmonid productivity, reduces amenity value and jeopardises tourism.
Senator Kiely mentioned the huge increase in the national flock in the last number of years, especially in disadvantaged areas. I have a great deal of sympathy for farmers in those areas who are trying to make the best use of their land. However, the impact of overgrazing on aquatic environment has been pointed out since the early 1990s. In recognition of the seriousness of this overgrazing problem, amendments to the Rural Environmental Protection Schemes aimed at reducing stock density in badly affected areas were introduced in 1995. I am not sure how effective these have been.
To prevent further damage, the Environmental Protection Agency proposes that Government and EU incentive schemes such as headage payments be urgently re-examined in the context of their adherence to the principles of sustainability and that alternative schemes be urgently introduced in the sheep sector. Senator D'Arcy's point as regards quality as opposed to quantity is important, especially when one is aiming at the continental market. The Environmental Protection Agency also recommended that effective interdepartmental and interinstitutional channels of communication should be established at EU and national levels in order to prevent a recurrence of such environmental degradation.
While the safety of drinking water is not affected, the quality has deteriorated by 5 per cent in the last couple of years. The taste and odour of water is seriously affected and in some areas is so bad it is undrinkable, particularly in some villages in the west of Ireland. While I have great sympathy with sheep farmers as regards their current problems, we must aim at quality rather than quantity. We must make every effort to ensure that overgrazing does not lead to further problems in the quality of Irish water.
A Chathaoirligh, I join with previous speakers in congratulating you on your election to high office. I compliment you on your great achievement and I recognise you are following in the long and noble tradition of your father and grandfather who made important contributions to the development of this country and in establishing a democracy. I am sure you will have a successful term as Cathaoirleach. Hopefully it will lead to a future successful term in Dáil Éireann.
In order to fully understand the position in relation to the motion before the House it is necessary to provide some background information on the operation of the ewe premium system.
EU Regulation 3013/89 aims to provide for the full establishment of a single market in sheepmeat, involving compensation by means of an annual premium for loss of income. The EU legislation bases the calculation of the premium on the gap between the average EU sheepmeat price and the EU basic price for sheepmeat. Despite the operation of the common organisation of the sheepmeat regime since 1992, market prices within the EU have failed to converge, to any appreciable extent, though some narrowing of the divergence has occurred. Prices in the majority of member states are relatively close but there are three or perhaps four countries, including Ireland, in which prices significantly deviate from the average. That said, it has to be accepted that the premium increases when market prices Community-wide are low and that it provides important income support for sheep producers.
My Department is fully aware of the complaint of producers in Ireland that the single EU-wide premium provides inadequate compensation in countries with low market prices, as compared with the situation in member states where substantially better prices are available. This argument seems conclusive on the face of it but if the relative profitability of lamb production between countries or the returns per unit of production are compared, the Irish systems come out comparatively well. The ewe premium system was never intended to fully compensate for poor market prices but rather was to ease the burden of losses while still allowing scope for the market to reward supply of high quality and excellent standards. At the end of the day an agricultural production system will be secure only if orientated towards market demand and if it is open to market reward rather than cushioned from reality by a full price compensation support system.
The real necessity for a premium system is evident when demand diminishes and prices slump. Last year was a very difficult year for the sheepmeat sector during which the Minister for Agriculture, Food and Forestry sought and secured exclusive arrangements for Ireland. A special supplementary premium was paid to producers in the non-disadvantaged areas and a top-up of headage payments was paid to producers elsewhere. By any standards considerable effort was devoted to securing this special arrangement which provided a very welcome boost to the incomes of producers who had experienced poor market returns. It is worth nothing that the rate of premium in 1995 reflected the poorer market and was 19 per cent higher than in the previous year. At that time, in view of the fact that the European Commission was obliged to provide a report on the operation of the sheepmeat quota regime, Ireland saw a window of opportunity to secure a wider review of the sheepmeat regime — an opportunity which has been pursued vigorously.
Earlier this year a detailed memorandum was sent to Commissioner Fischler suggesting the areas which need to be examined in the context of the review to ensure that the sheepmeat régime was more responsive to different conditions in the Union. Among the proposals which were put to the Commission was that there should be an automatic top-up of the premium in any member state where prices dropped by a predetermined percentage below the EU average price or, alternatively, that the rural world premium should be paid to all producers in member states where there was unusual market failure. Despite a considerable correspondence and several meetings in the last 18 months, the Commission has not put forward proposals to adjust the premium mechanism to compensate individual member states for low market prices.
The principal objection of the Commission against the introduction of change at this juncture is the increased burden on the EU budget which improved compensation for sheep producers would involve. Up to this year the expenditure on support for this sector is higher per kilo of sheepmeat produced than for any other meat. There has been severe criticism from the EU Court of Auditors about the cost of this support régime.
Another difficulty which the Commission perceives with individual countries or regional compensation is that producers now operate in a Single Market but differing levels of compensation might create an incentive to processors to allow market prices to float downwards, thereby giving them a competitive advantage, in the knowledge that the producers would be compensated from a central EU fund. The Commission has also referred to the fact that although market prices in Ireland may be below the EU average in terms of the price per kilo, the returns per lamb for Irish producers are substantially more favourable because of heavier carcase weight than, say, those received by southern European producers where light lambs are produced. They have also pointed to the fact that Irish producers benefit from a relatively low-cost grass based system which may allow better relative profitability than a cursory glance at prices might suggest.
Another objection raised by the Commission to possible change is that change now would upset the delicate balance of the compromise agreement reached in 1989 and again in 1992 on the sheepmeat régime. A compromise agreement by its nature will involve some issues which run against the interests of parties to that agreement. Many member states are dissatisfied with certain aspects of the régime and all would use the opportunity of a revision of the regime to seek to suit their own producers. In such a compromise, it would be inevitable that some changes unfavourable to Ireland would be included in any new package. By and large, the existing market support regime has operated to the benefit of Ireland. We hold over 5 million quota rights, about 9 per cent of EU sheep production, and the annual support amounts to £120 million for 48,000 producers.
Much has been made of the so-called response by sheep farmers to poor market condition in 1995 in that the numbers involved in sheep farming have diminished. Let us look at the facts. In 1982 there were 48,700 farmers in sheep rearing who held 3.97 million ewes with an average flock size of 81 ewes. Unlike the milk sector where the quota system was imposed almost without warning, the sheep sector was given several years advance warning of the likely introduction of quotas, so the sector held an opportunity to build up sheep numbers before quotas were introduced. In this period many producers very sensibly moved into sheep, having learned from the experience of milk producers of the closed shop effect of the quota system once established.
As a result of this opportunity, by the time quotas were introduced in 1992 there were 53,560 producers in the country who owned just over 5 million ewes. The latest figures available for this year show that just over 48,000 producers have obtained ewe premium in respect of 4.67 million ewes. This indicates that the number of producers is back to where it was before the artificial buildup to the quota regime but that there has been a significant improvement in scale with average flock sizes increasing by 19 per cent from 81 to 96 in the period in question.
There are a number of reasons, other than a response to markets, the number of farmers has returned to the pre-quota level. For example, new producers found sheep production demanding and requiring a long-term commitment which sectors such as tillage for example may not have involved. In addition, some farmers found that they were above the stocking density limits for the purpose of application for extensification payments. These are, of course, only two of the several other factors involved. Looking at the structure of the sheepmeat sector it is undeniable that up to this year there has been a small but steady movement out of sheep. However, these quota rights are not lying idle or lost but are changing hands and, by and large, are being taken up by existing sheep producers or by young entrants to the sheep sector. This is the behaviour of a healthy developing agricultural system.
Regrettable as it may be to see older and smaller producers moving out of sheep, I am pleased to say that there is at the same time a build up of more viable sheep production systems and a steady demand for quota rights from the national reserve from young farmers who see a future in efficient sheep production. Like any other agriculture sector, if the Irish sheepmeat industry intends to rely solely on outside support and market management alone, it will have no secure future. We must, therefore, strive to get the basics right and produce a product which accords to market demands, achieves standards of excellence and pays adequate attention to the need to be price competitive in an increasingly demanding market.
There are weaknesses in the industry and we need to remedy them. Not all the problems are caused by external factors. A greater effort needs to be made to achieve quality on a more consistent basis. The French market on which we are so dependent will penalise for poor quality product. If we do not produce exactly what the market demands many of our competitors are fully prepared to take over our market share. In view of the importance of quality standards, the Minister for Agriculture, Food and Forestry has promoted the introduction of a lamb carcase classification scheme to be implemented in all export processing plants from this year.
A working and effective carcase classification system which acts as a transparent basis on which the producer is rewarded for quality of his product is crucial to the improvement of the standards of lamb production. Up to this, the pricing system paid a producer to produce heavy lambs which are often over-fat and well beyond market readiness. By linking payment to quality rather than weight the producer will quickly respond by producing quality rather than heavy lamb. Unfortunately, there has been some resistance to the concept of a standard carcase classification. The Department was given the task of overcoming this resistance and I am pleased to say that good progress has been made. All export plants are now either operating a classification system or have firm plans to introduce classification in the immediate future.
Senators on the other side of the House would have you believe that securing amendments to the sheepmeat régime is a relatively simple matter. The reality is very different. Amending the sheepmeat regime would require the support of a majority of member states, most of whom would either derive no benefit or would lose out in such a reform. Apart from Ireland there is no demand for a fundamental change to the régime. There is a misunderstanding that the EU Presidency proposes and disposes of business. It is the EU Commission which must propose change, perhaps at the instigation of one or more member states. When making such proposals it must be aware that they must be adopted by a majority of member states.
There is also the question of timing. In stark contrast to 1995, this has been an especially favourable year for sheepmeat, with record prices for most of the year. Prices this year have been, on average, 18 per cent above last year's level and in the peak selling period prices were between 20 per cent and 36 per cent higher than in 1995. At present there is even a risk that they will overheat; the very high prices being paid for breeding stock indicates that producers are confident about the future.
That is the context in which this issue is being considered. A period of relatively favourable market conditions and high prices is rarely a suitable time for reviewing a regime with a view to providing more effective support for producers' incomes in difficult market conditions. Nevertheless, the Minister for Agriculture, Food and Forestry intends to use the opportunity provided by the EU Commission's report on the ewe premium quota system to seek to persuade the Commission to conduct a more thorough review of the premium system itself, with a view to removing some of the inequities from the system to make it more responsive to low prices in certain member states such as Ireland.
I assure the House that the Minister and the Department are fully alive to the situation in the sheep sector. No favourable opportunity will be bypassed to secure changes to the regime which would be of benefit to Ireland.
With regard to Senator Henry's question on overgrazing, the provisions under the REP scheme are proving to be effective when put into operation. There is good compensation and attractive terms for destocking. This measure is especially effective in areas such as Brandon, where I have a personal interest, where approximately 80 farmers are now joining the scheme. It is also especially useful with regard to the overgrazing of commonages.
I thank the Fianna Fáil Senators for raising this matter. A discussion on the sheepmeat industry is timely. The problems with BSE have diverted attention away from this sector. However, we made a number of proposals to the EU Commission, which is slow to move for reasons I have already outlined. The Minister will keep on the pressure to ensure that the interests of the sector are protected.
A few years ago there were scenes outside Agriculture House when the sheepmeat sector was under considerable pressure. Thankfully those days are gone and the sector is now performing much better in terms of income and otherwise. I hope we can build on that strength for the future.
This is an important debate and it is a pity that amendment No. 1 was moved. The motion is non-political. The Government parties could have accepted it because there is nothing in it that is objectionable. It states:
That Seanad Éireann calls on the Minister for Agriculture, Food and Forestry to honour his commitment to obtain changes in the method of calculation of the ewe premium payments which will end the discrimination against Irish sheep farmers.
How could somebody oppose this while expressing concern for sheep farmers?
The Minister of State said that, apart from Ireland, there was no demand for change in the EU. This is normal as Europe is largely industrialised. However, in Ireland, a large number of farmers, including small hill farmers, depend on the sheep industry.
No Minister would have a problem establishing the fact that the sheep industry is unique to us. We export sheepmeat all over Europe. France and England are important markets, and we are aware of the grading system. Given this, we should not apologise for stating the value of the industry to Ireland. If we do not do so we are failing in our responsibility and will have missed an opportunity. That is what is expressed in the motion. I am sorry that the amendment was moved because to divide on this issue gives an impression to Europe that our motive in proposing the motion is to embarrass the Government. That is not the case.
I am interested in those who depend on the sheep industry and in ensuring the survival of hillside farmers in several locations throughout a third of my county. This is why I am obliged to speak on this issue. I am not interested in attendant publicity, be it on "Oireachtas Report" or whatever, but I must speak in support of those who depend on the sheep industry for their livelihoods.
There are no good grounds for opposing the motion because not enough has been done to support the sheep industry. The Minister of State says there are approximately 4.5 million ewes in Ireland. However, the total flock of all grades and type of sheep is almost nine million.
I find it difficult to detect any kind of aggressive campaign on behalf of sheep producers. When one can buy a leg of Australian lamb in Strabane and sheep producers with favoured status import from New Zealand into the Commonwealth, we should not apologise to Europe for seeking support. It is infinitesimal by comparison with the money pumped into industries, such as the computer industry. We should not apologise for our efforts in sustaining sheep farmers.
Many farmers in rural Ireland largely depend on the sheep industry and we are not doing enough to secure it. Is the Government not surprised that, despite the fact that there are approximately 9 million sheep in Ireland, no value is obtained from their wool? At one time there were seven woollen mills in this country. Now, we have almost 9 million sheep but we do not have a woollen industry. That is the kind of support we are giving sheep producers. The fact that we do not have woollen mills and are selling our wool at a price only slightly higher than what it costs to clip the sheep is not highlighted. Every thread of wool in garments, blankets, etc. is imported into Ireland but the Government is not concerned. This industry should be sustained.
Those who say that we are over-grazing or are overstocked are speaking from the comforts of city life, they have not spent long enough on the side of a mountain. I get angry when I hear that. The root cause of the decline in our population is that those who legislate are far removed from the important industries we are talking about. All too often those people have a deciding voice.
I have no difficulty identifying the failure to promote the sheep industry. I do not say this to the Minister in a nasty way but he and his Department should be doing more. I ask him to accept our motion because it has been put down for sincere reasons, not out of one-upmanship or to score a point because that would be a shallow achievement. Our remarks are genuine. The Government side will press to a vote its amendment to praise the Minister but what will have been achieved? The amendment does not show sincere support for the sheep industry or those who depend on it.
I welcome the Minister of State, Deputy Deenihan, to the House and I suspect he will be with us later for the Control of Horses Bill. The Progressive Democrats support the Fianna Fáil motion. Like Senator McGowan I wonder about the necessity for the amendment; it supports the actions of the Minister "in his efforts on behalf of Irish sheep farmers and in regard to his efforts to secure changes in the ewe premium system", yet the Minister gave a catalogue of reasons for not securing those changes. There appears to be an inconsistency between the Minister's contribution and the amendment.
The Minister suggested that we, on this side of the House, regard changing the EU sheepmeat policy as a simple matter but that is far from the case. No one suggests this is a simple matter, it is difficult to change policies but that is not to say that it should not be attempted. It is also wrong to suggest that the Presidency does not have an influence or function in this respect. The Commission has a role but I suspect that if the Presidency of the Council wanted something tabled for discussion at a Council meeting, it would be able to secure that by virtue of consulting with the other member states.
This would not be such a serious matter had the Minister not explicitly stated on the Dáil record that it would be his "absolute top priority" to have a full review of the sheep sector during the Presidency. In those circumstances there is an obligation to deliver on that promise, which was made in the context of severe difficulties for the sheep sector debated at length in both Houses. It was quite understandable in the face of those difficulties that the Minister would make such a commitment — it has been mentioned that reviews tend to take place in unfavourable circumstances — but now that things are better no one is absolved from the commitment made.
Before I came to the House I heard a statement that this Minister had done much more for Ireland than anyone before. That is carrying things a bit far. I do not say the Minister has not done good things for Ireland. Every Minister that I can recall acted in the country's best interests. For instance, someone should tell the former Minister, Mr. Mark Clinton, that this Minister did more than anyone else. Many Ministers have done just as much as the current Minister and we should not believe self-promoting hype.
A solemn commitment was made which is on the record of the Dáil and there should be no question of doing things with mirrors or bi-location. It is a question of making a genuine effort to deliver on that commitment. It is not simple but it must be done. The consequences of a £5 cut in the ewe premium for the 48,000 farmers involved are severe. The Teagasc figures on income from sheep farming show that more than 100 per cent of a farmer's income derives from EU moneys — in other words, the profit is coming from the premium, therefore every effort must be made to ensure the premium is at its maximum and is not eroded by the stabiliser mechanism. Reference was made to our failure to achieve convergence within the EU which we hoped would occur. If such convergence does not occur and Irish prices are significantly below the EU average, an effort must be made to make up the difference. The fact that we have quotas means there should be no necessity for the stabiliser and it should be possible to get rid of it.
As to the question of marketing Irish lamb, in the Seanad debate on agriculture on 1 February, at a time when the environment was difficult for sheep production, the Minister, Deputy Yates, said:
Over the last 15 years our sheep production has been standing still. [That is in marked contrast to what we heard this evening.] Our national average for lamb output is 1.1 lambs per ewe; our quality has not improved and our breeding has remained broadly static. We must address these issues.
What has been done in the meantime to "address these issues"? The Minister also mentioned the report of An Bord Bia, which was published last January. We have had a long time to consider that and do something about it. He also mentioned the lamb classification scheme at that time:
The lamb classification scheme, which is not a statutory scheme and will not involve a huge bureaucracy or levy, is now being put in place. [We now hope to have it in operation for the coming year.] We will target a number of initiatives with An Bord Bia to move towards more ready cuts, more labelling, racks of lamb and legs of lamb as opposed to just dumping the carcase on the Rungis market at a low price.
I applaud the initiative but in the context of the difficulties which have confronted the beef industry as a result of BSE, has An Bord Bia's eye been taken off the ball in the lamb market? It must not be because funds should not be diverted from lamb into beef, granting all the difficulties in the beef sector and that An Bord Bia has a difficult task in promoting beef. We have a huge opportunity to exploit the resource of natural lamb, which is free of additives and hormones and comes off grass. Tourists coming to Ireland will eat lamb, as a matter of preference, in restaurants in the west because of the surroundings from which the lamb comes. That is our best marketing tool.
In response to Senator McGowan on the question of over-grazing, criticism does not only come from people sitting in comfort in Dublin who know nothing about farming but also from me as a farmer. I fish on the River Erriff in County Mayo and what has been done on the mountains above the river is a disgrace.
The EU system has promoted a production cycle which means that all one has to do is to put as many sheep as possible on an area of ground to secure a premium. Any system which does that is wrong. It must support the income of the people living in the area, but not at the expense of the environment. I know from climbing the mountains around Lough Currane that the heather at the top is gone as a result of overgrazing.
REPS did not exist then.
REPS has not solved the problem.
Farmers are only entering the scheme following the Department's initiative. There would be no incentive only for REPS.
Those who put together the REPS proposals for Ireland wanted to do something about overgrazing. They were prevented from introducing the measures they recommended at the outset of the scheme. They are only being discussed now when the damage has been done.
The damage was done years ago.
The Minister of State should go to Leenane. I will show him the fenceline on the mountain; one side is brown and the other is green.
I know it well.
I do not understand why Teagasc has put a farm beside of one of the premier salmonoid rivers in the country. There must be proposals to the Commission and these need to be acted upon. Ireland must take the initiative and technical support must be given to the industry to ensure the lambing percentage is increased. Ireland is competitive in terms of income per lamb but it does not have enough lambs per acre or per ewe. There are lies, damn lies and statistics and that is one statistic that points us in a questionable direction.
The purpose of the motion was that the Minister would honour his commitment to change the system of calculating ewe premiums. I quoted from a speech by the Minister for Agriculture, Food and Forestry in the Dáil on 7 November 1995 and asked what the Minister has done since; he has done nothing. The Minister of State said that, despite considerable correspondence and several meetings in the last 18 months, the Commission has not put forward proposals to adjust the premium mechanism to compensate individual member states for low market prices. That is a disgrace. In his Dáil speech the Minister said:
I can say that, if there is any prospect that I can use our Presidency in 1996 as part of the review referred to which may be carried out in the first half of 1996 — I will seek to have it as my absolute top priority so that it will incorporate the points made on price convergence.
What was the Minister's top priority? He came into this House on one occasion and accused me of encouraging the spread of BSE and would not apologise afterwards. This Minister is a disgrace. He has let sheep farmers down. This change is needed, especially as we are an island nation. The principal objection of the Commission to the introduction of the change is the increased burden on the EU budget which would involve improved compensation for sheep producers, but they deserve it.
The price of lamb is good at present because of the BSE crisis and the price of lambskin. These prices are not sustainable and sheep farmers will be in dire financial straits again. Another difficulty with the Commission is that producers operate in a single market but when it comes to milk quotas other countries are getting preferential treatment. Why should Ireland, a peripheral country, not get preferential treatment too? This is an island country with a green image producing the best lamb under extreme conditions.
Sheep farmers will not forgive the Minister and they will let him know at the next general election that they do not appreciate what he is doing. It is no reflection on the Minister of State but I am disappointed that the Minister is not here. He is our representative in Europe and is doing nothing. He gave a commitment that during the EU Presidency this would be his top priority.
That is unfair.
I am only quoting what he said in the Dáil. This is not like saying one was at Dublin Airport when one was really in Wexford. He is letting the farmers down.
He got a great deal for the sheep sector last year.
The sheep farmers are not satisfied.
They are doing better than ever.
They are disappointed. He said that this would be his top priority but reneged on it by doing nothing.
Amendment put.
The Seanad divided: Tá, 21; Níl, 19.
Tá
- Belton, Louis J.
- Burke, Paddy.
- Calnan, Michael.
- Cashin, Bill.
- Cotter, Bill.
- Cregan, Denis (Dino).
- D'Arcy, Michael.
- Doyle, Joe.
- Enright, Thomas W.
- Farrelly, John V.
- Hayes, Brian.
- Howard, Michael.
- McAughtry, Sam.
- McDonagh, Jarlath.
- Magner, Pat.
- Maloney, Seán.
- O'Sullivan, Jan.
- Reynolds, Gerry.
- Sherlock, Joe.
- Townsend, Jim.
- Wall, Jack.
Níl
- Bohan, Eddie.
- Byrne, Seán.
- Daly, Brendan.
- Dardis, John.
- Fahey, Frank.
- Farrell, Willie.
- Fitzgerald, Tom.
- Kelleher, Billy.
- Kiely, Rory.
- Lanigan, Mick.
- McGennis, Marian.
- McGowan, Paddy.
- Mooney, Paschal.
- Mullooly, Brian.
- Norris, David.
- O'Brien, Francis.
- Roche, Dick.
- Wright, G.V.
Tellers: Tá, Senators Burke and Magner; Níl, Senators Fitzgerald and Ormonde.
Amendment declared carried.
Motion, as amended, put and agreed to.