Vol. 1 No. 2
I welcome the Minister for Agriculture and Food, Deputy Walsh, and his officials to the meeting. We have been asked to consider the revised Estimates for the Department and Agriculture and Food. The clerk to the committee has circulated a draft timetable for our consideration which will allow us to focus on aspects of the Estimates and facilitate questions and answers. Is the timetable agreed? Agreed.
I invite the Minister to make his opening remarks.
I thank the Chairman and members. I am pleased to have the opportunity to meet the select committee to discuss the 2003 revised Estimates. I will set out the context in which they have been drawn up, identify the key priorities in the allocation of funding and say a few words on the main subheads.
I commend the revised Estimates to the committee. They were framed against the background of changing economic circumstances and after a lengthy period of unparalleled economic growth in the economy and public expenditure. Government spending on agriculture increased by 36% between 1997 and 2002. This reflected a significant increase in overall support by the Government for the agri-food industry generally. Total public pending on agriculture and food is expected to reach approximately €2.8 billion this year. The Estimates for voted expenditure by the Department for 2003 are somewhat lower than the outturn for last year but this is partly due to the fact that certain expenditures incurred last year do not have to met this year. For example, some of the BSE and foot and mouth disease outbreak related costs spilled over into 2002. In addition, there were non-recurring expenditures in 2002 relating to the arrears of compensatory payments in disadvantaged areas and the final tranche of agri-monetary compensation.
I am pleased that, having regard to the overall budgetary situation, the revised Estimates provide for gross expenditure of €1.246 billion. The provisions for some of the more significant schemes operated by the Department are well up on those for 2002. For example, the provision for the REP scheme is up 12%, while the allocation for the agricultural elements of the national development plan is 28% higher than the 2002 outturn.
One cannot fully describe the background to the revised Estimates without making reference to the substantial sums paid by the Department to farmers and the food industry on behalf of the European Union, which are not included in the Vote. Expenditure on these payments amounted to €1.6 billion in 2002. These payments are of enormous importance to farmers, particularly in the beef, sheep and arable crops sectors. When these measures are taken into account, total public spending on agriculture is expected to reach approximately €2.8 billion this year.
The main priorities in the 2003 revised Estimates are the protection of human and animal health by implementation of the national development plan and the CAP rural development measures and the provision of agricultural education, training and research. The protection of human and animal health is a major priority for the Department in the context of the development of our agriculture and food sectors. In the final analysis, for agri-food industry to flourish, consumers at home and abroad must have full confidence in the methods used in the production and processing of food and that the controls in place ensure only safe food products reach the marketplace and the final consumer. Some €258 million is provided in the Estimates, under a number of subheads, to enable the Department to meet these concerns, mainly through the implementation of effective disease control measures and a comprehensive cattle and sheep traceability system. In addition, about 48% of the salary costs in subhead A1 relate to almost 2,000 staff working on human and animal health. This is a reflection of the wide remit of the Department.
The provision under subhead C1, which covers the TB and brucellosis schemes, is €67 million. This is 13% lower than the outturn for 2002 and reflects an improved disease situation. During 2002 the incidence of brucellosis was down 22%. The progress in relation to TB is reflected in a reduction from 34,000 to 29,000 in the number of reactors disclosed in 2002, compared with that for 2001. This progress is expected to be maintained this year.
The reduction in the provision for subhead C2, which covers measures related to BSE, reflects a significant reduction in the incidence of BSE and a phasing out of the subsidy for the disposal of meal and bonemeal. With regard to the incidence of BSE, there is clear statistical evidence that the controls in place and enforced by the Department are working to protect public health and consumers while bringing down the numbers of animals with the disease. For example, up to the end of April this year, there has been a 38% reduction in the number of BSE cases, compared with the number in the same period last year. In addition, the trend in the age profile of animals identified with the disease provides clear evidence that the disease is being effectively controlled and will eventually be eliminated from the national herd.
Subhead C2 provides for financing of meat and bonemeal and a rendering subsidy. This subsidy was introduced in January 2001 as a short-term measure to allow time for the industry to adjust to the new situation. It was never the intention that it would be paid indefinitely and, in general, the policy of the Government has been to return financial responsibility for the disposal of waste to the industry.
In furtherance of this policy, I announced earlier this year that the remaining subsidy would be terminated at the end of February. However, in view of the difficulties which this situation would pose for the industry, I extended the subsidy at a lower rate until the end of this month in order to allow more time for the introduction of greater efficiencies in the area of the handling and disposal of animal waste. The cost of this extension is estimated to be €11 million, bringing total expenditure on meat and bonemeal this year to almost €40 million. This was a significant gesture to the farming community, particularly in the view of the background of difficult financial constraints on Exchequer spending generally. The overall Exchequer expenditure on supporting the disposal of meat and bonemeal since the introduction of the ban has been €140 million.
The Government has been generous in its support of the livestock sector in recent years, with public funding of some €500 million to help it through the BSE and foot and mouth crisis. We are continuing support for the storage of meat and bonemeal and for rendering of depopulated herds and of fallen animals.
The Government has also established an interdepartmental agency committee to examine the disposal options for meat and bonemeal in Ireland. The committee is currently examining all the options permissible under EU regulations and I expect its report shortly. It is evident that domestic disposal options would reduce the cost burden in this area.
I am providing €11.2 million this year under subhead C4 for the national beef assurance scheme and cattle registration and tagging schemes. The aim of the national beef assurance scheme is to provide an effective cattle identification and tracing system and to develop common high standards of production and processing of beef. The cattle identification and tracing element of the scheme has been in place since the beginning of 2000 and the bulk of expenditure proposed this year will be used to maintain the current arrangements and to develop the system further by introducing the new animal health computer system and by re-engineering the current movement monitoring system.
There has been substantial investment in this area over the past decade and this resulted in significant developments in the traceability of cattle in the same period. The CMMS is used extensively for disease control and to verify entitlements to the various EU livestock premia. On the latter point, the CMMS has enabled the Department to make payments under the cattle slaughter premium since 2000 without requiring farmers to submit formal paper based applications. This has helped to simplify procedures for this scheme and minimise bureaucracy. In addition, the Department has committed, in the recently adopted partnership agreement, to use the CMMS to the maximum extent possible, commencing this year, for the calculation of stocking density for the extensification premium.
Total expenditure on agricultural education, training and research will reach €120 million this year. Teagasc has a very important role to play in the implementation of the Government's strategy in this area. For that reason, substantial Exchequer resources are provided each year to enable Teagasc to provide first class research, training and advisory services for Irish farmers and the food industry. The funding provided by my Department to Teagasc for non-capital purposes has increased significantly in recent years, from €81 million in 1999 to €109 million this year. In addition, in spite of the tight budgetary situation this year, the allocation to Teagasc is the highest to date, representing a 5% increase from last year. These are substantial resources and reflect the Government's continuing commitment to supporting Teagasc. Nevertheless, I acknowledge that the level of grant aid to Teagasc for this year is somewhat lower than that sought by the organisation and that it will have to make certain adjustments to accommodate the actual provision.
It is a matter for the board and management of Teagasc to prioritise its activities in the delivery of agricultural research, training and advisory services and to allocate its resources in accordance with those priorities. Teagasc recently decided to rationalise its activities and concentrate the delivery of its services at fewer centres. However, I want to emphasise that, when these decisions are implemented, Teagasc will still have a network of more than 70 advisory and training centres nationwide, as well as nine major research centres and 11 agricultural colleges. The ability, therefore, of Teagasc to provide its range of services will not be diminished.
Under the CAP rural development plan, a total of €503 million is being provided for the three accompanying measures. In the case of the agri-environment programme, REPS, for example, the 2003 allocation of €190 million represents an increase of 12% on the outturn for last year. At the end of 2002, some 36,800 farmers were participating in REPS. In the case of the other two agricultural measures, the early retirement scheme and the compensatory allowances scheme for farmers in disadvantaged areas, the combined allocation of €313 million should suffice to meet expected commitments.
The new partnership agreement, Sustaining Progress, proposes significant changes to the REP and farm waste management schemes. These range from increased support rates to improved eligibility criteria with a view to increasing participation from approximately 37,000 farmers at present to 55,000 farmers by the end of 2005. The farm waste management scheme ceiling has increased to 450 income units and the investment ceiling to €75,000. The investment ceiling for the dairy hygiene scheme will be increased to €50,000. These improvements are subject to EU Commission approval and are likely to be considered in tandem with suggested changes that may emanate from the current mid-term independent evaluations of the NDP and the CAP plan. I am confident that the amendments will boost participation in these two schemes, which have a vital role to play in meeting our agri-environmental conditions.
In the case of the NDP agricultural development schemes, €31 million is being provided in 2003, which is a 29% increase on 2002. Agricultural development covers a range of measures including on-farm investment, development of equine and cattle breeding infrastructures and development of the horticulture sector. The farm waste management scheme is the largest measure under this heading. To date, some 6,000 farmers have applied for participation under this scheme.
The continued development of the food industry is an important objective for my Department. The Department, in co-operation with Bord Bia and Bord Glas, will continue to assist the industry to establish new export markets for Irish food products and to consolidate our presence in existing markets. Significant funding is being provided to the food sector under the national development plan to improve competitiveness, market orientation and innovative capacity. These initiatives cover capital investment, marketing, promotion and research measures. These measures are expected to increase sales of food and drink products by €2.5 billion by the end of 2006.
The grant-in-aid provided in subhead E1 is designed to assist Bord Bia in implementing a wide range of specialist marketing and promotion activities to enhance Ireland's international profile as a producer of quality food and drink products. Bord Bia's grant-in-aid increased by over 40% from €12.587 million in 2000 to €18 million in the past two years. Some 14 additional staff were appointed in the same period. In line with changing economic circumstances, the level of grant-in-aid funding in 2003 has been set at €17 million, which is slightly lower than in 2002. However, this is a significant budget and I am confident that An Bord Bia will continue to promote Irish food effectively this year.
In the context of promotion of exports, the independent Estimates review committee, in its report of December 2002, suggested that savings could be achieved by closer co-operation among Bord Bia, Bord Glas and Enterprise Ireland. The committee also recommended that, in the longer term, the functions of these bodies might be integrated under a single agency to achieve greater efficiencies and synergies in the promotion of Irish produce.
A Government decision formally approving the merger of Bord Glas and Bord Bia was taken on 19 March this year. Legislation to give effect to this decision is being prepared and will be presented to the Houses of the Oireachtas in due course, hopefully this year. The scope for more formal co-operation between these two bodies and the food sector development activities of the other bodies outside the ambit of the Department of Agriculture and Food will be pursued at official level.
Bord Bia and Bord Glas have each been successful. In a changing and challenging world the range of expertise available to a merged body will be of long-term benefit to the horticulture and amenity horticulture sector. It is proposed in the legislation to provide for a sub-board with responsibility for horticulture, including amenity horticulture, to include all Bord Glas activities, including support for producers.
The sum of €37 million has been provided for market intervention, approximately €9 million of which will be used for the storage and ultimate incineration of stocks of meat and bonemeal accumulated from the operation of the purchase for destruction and special purchase schemes. The remaining 39,000 tonnes of meat and bonemeal from the schemes must be disposed of in 2003. Destruction will be completed by the middle of the year which will enable the Department to draw down the final European Union contribution to the cost of purchasing animals for the scheme. The balance of the subhead will be used to finance the cost of operating the intervention system, especially in the dairy sector. A reduced level of activity is expected this year, especially in the beef sector where stocks are expected to be reduced to residual levels by the end of the year.
The budget for running the Department, €240 million, is provided for under subhead A. This represents less than 9% of total expenditure by the Department. The funding covers the cost of managing the measures and services provided for in the Estimates and the administration of non-voted FEOGA expenditure on direct aid to producers as well as the EU funded export and processing aids to industry.
Subheads A5 to A7, amounting to €13 million, are essentially geared to supporting the Department's information technology strategy, a key component of its modernisation programme. Investment in the latest technology is necessary to enable the Department to achieve the goals set out in the strategy statement and provide a top class service for the Department's beneficiaries and clients and the agriculture and food sectors generally. We have made significant strides in this area in recent years.
Overall, the revised 2003 Estimates represent a balanced and well-founded package of measures to support the agri-food industry. I commend them to the committee.
I thank the Minister for his submission. Fine Gael opposes the revised Estimates because, when the original Estimates were published in the first weekend in November, there was an indication that Exchequer returns would be in a difficult position. They turned out to be healthier than envisaged, however. Given that agriculture is one of the most susceptible and difficult sectors for those participating in it, the Estimates should have been revised when the position changed and those areas cut back should have been facilitated.
I wish to raise a few issues and will not deal with the detail until we go through the subheads. The Minister said the Estimates were drawn up against a changed background. At a time when it is accepted that farm incomes have fallen by 8.5%, some measures to establish confidence in the sector should have been taken by now.
Agriculture has had a difficult year and, while there is the belief there is very little we can do, we did not take the few measures we could have. I am not so naïve as to believe the problems can be easily solved. The claim is often made that we do not have an agriculture policy. Every person who contacts me on the issue of agriculture has a solution but unfortunately they have a narrow focus. Trying to achieve an overall solution for the industry is difficult.
A few weeks ago I attended the agricultural consultants' conference and one would imagine from it that the solution is very clear. However, when one meets those participating in the industry, it is not simply a matter of economics. The two pronged approach we have adopted of maximising efficiency and the number of farm households probably impedes economic development. However, there is merit in it because, while money and funding are nice, there is more to life than economics.
There are a number of matters outstanding in agriculture. The Taoiseach indicated the Minister would be lenient in the Estimates and willing to share his knowledge and information with us. That is very helpful of him, although it is regrettable that we do not have more time to discuss this issue in the Dáil Chamber, although it can be argued that it can be raised at committee level.
There is great uncertainty among farmers with regard to the Fischler proposals, of which many are in favour and the concept of decoupling. However, it is a pig in a poke. There are many aspects to it about which we do not know. What is the current position? It appears there will be agreement by the end of June and the Commissioner is adamant decoupling will proceed in its full form. Perhaps the Minister will inform the committee of the position in this regard.
Regarding the other aspects of the proposals such as farm compliance, if they applied to politicians, life would be simplified because we would not have to worry about departmental officials not paying out when they should, the Minister having to make representations to seek intervention for skimmed milk powder and so on. Many are missing the point in respect of several aspects of the proposals which will result in a cut in production, a decline in farm numbers and a reduction in direct funding to the agriculture sector. In time it will become more difficult to sustain the subsidies. I would like to hear the Minister's views on the proposals.
One issue I raised previously was people who never claimed a subsidy. I raised this with the Commissioner and there are such people. Neither the farming organisations, the Department nor the Commissioner is aware of them. They might be small in number but there are those who have never claimed a subsidy. It would be unfair if they were not catered for within the system.
Regarding the ongoing industrial dispute, the Minister may claim it is an industrial relations difficulty outside his remit but it causes great hardship for many. What is the current position? The dispute cannot drag on indefinitely. I met a butcher from the Minister's part of the country who informed me of his difficulty in obtaining cattle and how he could only get half the number he required.
What is the position on temporary veterinary inspectors? I will not adopt the populist line. Reforms are needed in this area. What plans for reform does the Minister have?
One issue which arises repeatedly is that of non-EU products, for example, beef from third countries such as Brazil and Argentina. The Taoiseach in his address to the agricultural consultants indicated that more such products would be imported into the European Union. Tom Clinton spoke that day and said some of the Brazilian factories he had visited would put Irish factories to shame.
Will the Minister inform me of the quotas and tariffs that apply to foodstuffs from outside the European Union? Are we satisfied that what is imported is subject to the same production methods as our own produce and that the food safety procedures and restrictions in place are as strong as those in place in the European Union? Are we satisfied no product is being imported illegally into the Union, especially Ireland? We expend a great deal of energy on this issue and I do not know if it is necessary to do so. I would have always said people should provide proof of malpractice and would have no difficulty in following it up.
As I know Deputy Sargent will elaborate on the disposal of meat and bonemeal, I will not steal his thunder in that regard. This scheme has cost us €140 million since its inception. It is a problem that must be shared by the farm organisations and the Department and they must provide a solution. Have we an indication of what that might be? I do not have one but the situation cannot continue indefinitely. We cannot continue to store this material because it costs a great deal of money to do so. The Minister can extend the subsidy to the end of the year. If he plans to terminate it from the end of May, I hope that, in the spirit of generosity, he will extend it to the end of the year.
Money has been allocated for the beef assurance and dairy herd certification schemes. I am sure the Minister has received representations about the tendering process for cattle tags and about having more than one agent for it.
The Minister alluded to Teagasc. I know that he is not responsible for that organisation - he referred to the closure of centres - but what are his view on it?
Between 1997 and 2003, there may have been approximately 600 additional staff taken on by the Department of Agriculture and Food. The Minister referred to modernising the Department. We are aware that many staff are busy dealing with the payment schemes. If the Fischler proposals are introduced, will the Department's workload be radically reduced or will staff be re-assigned? Will the Minister say indicate the number of staff involved in the administration of the schemes?
I thank the Minister for his attendance and for providing the committee with an overview of the main issue.
I wish to express my concern about the funding of Teagasc and, in particular, any reductions in spending on research and testing. Ireland has a number of advantages when it comes to food production. We are certainly perceived abroad as having a clean, green image and a good environment, which is very important. We have to be able to compete at European level in terms of development in new and value-added products. When I say value-added products, I do not mean inserting a bundle of additives that add to the colour, flavour and texture of foods; I mean the development of new products. It is of some concern that Ireland might be seen to be lagging behind in terms of producing consumer ready and ready-to-eat meals as value-added products. Franz Fischler referred to it and Bord Bia referred to our lack of competitiveness in that area.
With the inevitability of the CAP and the reforms that will arise from it, we should be intensifying our interest and efforts in the research area. It is more important than ever that research is sustained in order to take account of those changes. The kind of areas that we should consider are food product development, basic agricultural research in the rural economy, environmental factors and sociology. Research is a vital prop in those areas, which all relate to sustainability.
There has to be continued investment in education and training for young farmers, in particular. I would be concerned that, if there is any reduction in its funding or budget, Teagasc might not be able to deliver on that level of education and training that will be even more important in the future if we are to compete. We have to accommodate change and we must educate and train people and produce research that will allow us to do that.
When farming becomes less intensive, as will inevitably be the case on foot of the CAP proposals, the fallout is that people living in rural Ireland will be looking for alternative employment opportunities. I would like to hear comments on what opportunities exist for rural tourism and also environmentally friendly opportunities.
We do not want a situation to develop where people who have traditionally been involved in farming and living in rural areas will virtually be driven from the countryside. They should be able, even if they are not in mainstream or full-time farming, to engage in employment that would allow them remain in their own environment. Development of areas such as e-business, access to broadband and a quality environment must be part of a renewed structure in rural Ireland.
I am pleased to see the Minister prioritising an area which is of great interest to me, namely, that of food safety and animal health. There is always a huge public response and genuine concern regarding food scares. The scientific and technical development and market restructuring will have to take account of our needs in the area of food safety. We must continue to examine the impact of new technological developments on new food product development and any implications there might be for food safety.
We will be addressing the enlargement of the EU in the near future. There will be 106 million extra consumers and this has both advantages and disadvantages. There are opportunities from an exporting perspective, but equally competitive opportunities for the accession countries. We need to look carefully at our aggressive marketing opportunities through An Bord Bia. I would be concerned if the role of An Bord Bia was diluted in any way. I ask the Minister to comment on the amalgamation of Bord Glas and Bord Bia. I regard Bord Glas as having quite a distinct role from that of Bord Bia. Its role in the production of horticultural produce might be diluted if it is to be amalgamated with Bord Bia and we should examine this further.
I welcome the decline in TB and brucellosis, but I have some concerns that the level of decline has not been as sharp as would be desirable. I call for a more aggressive approach against TB and brucellosis in the same way as the successful attack on foot and mouth. I know that one cannot make a direct comparison, but there was a positive and aggressive policy in respect of foot and mouth and perhaps some of the same effort should be applied against TB and brucellosis.
There is no reason for complacency with regard to other animal diseases. We must be aware of the risk from Johne's disease, which has been flagged on a number of occasions. If this disease is not dealt with in a positive manner, it may get a grip in the way TB and brucellosis have done. It is perhaps easier to deal with, but we should address it immediately rather than allowing it to take hold and then trying to deal with its aggressive effects on the animal population.
I welcome the downward trends in the numbers of cases of BSE and I hope that will be sustained. There is every reason to believe that the trend will continue. It is of some concern that, even at this stage, there are still younger animals testing positive for BSE. We need a thorough investigation, and we need to be informed about the outcome thereof, into any younger animals that have tested positive. Deputy Timmins referred to the meat and bonemeal and its disposal and I look forward to the interdepartmental agency report on it. I acknowledge that it is not an easy matter with which to deal.
I wish to comment on the national beef assurance and cattle registration and tagging schemes. In spite of great improvements, there are still problems in respect of tagging, its application and, at times, even its effectiveness and efficiency. Will the Minister consider reviewing the developments that are occurring in Europe and the proposals there for electronic tagging? I have raised this issue on previous occasions and I realise that it is not something which can be implemented immediately. I know that there are very positive moves at European level in respect of it.
I must mention the Control of Horses Act and the provision of financial assistance to local authorities. In my constituency, I have observed that very often mainstream agricultural matters do not engage my constituents on a daily basis, but, apart from food safety, one aspect that is of interest is the control of horses. I occasionally receive representations in respect of problems with horses so I welcome the Act.
I wanted to mention the responsibility and the role of Ireland with regard to developing countries and how it might impact on their developing economies. There is an inequality of agricultural production and incomes. Millions of people in developing countries are starving and this clearly imposes a moral responsibility on Ireland, as a producing country, to be aware and to take some action to reduce that level of inequality. If developing countries are to grow, they must be given the opportunity to do so, the space to compete and the opportunity to trade. I realise that what I am saying would have implications for Irish agriculture in relation to subsidies. However, I ask the Minister to take the issue on board. He should take a generous view of our attitude to agriculture in developing countries and give them the chance to be self-sufficient to a certain extent.
I want to comment on the role of women in agriculture and note their major contribution. The women concerned are not just farmers' wives, they also make a huge contribution in terms of farming. If this was acknowledged, there might be an opportunity for the promotion of the recognition of the role of women in agriculture. Looking around me I note the gender balance.
I thank the Deputy. She should not worry, we will look after her.
I welcome the Minister and his team and thank him for his presentation. No one likes to see money decreasing but we must now look at matters in a different light. I am pleased there is an increase in REPS payments, which will make a tremendous difference to farmers.
I want to say something about food safety and hygiene. A few years ago I visited central France and was amazed to see bread and meat being sold under canvas on the streets. There seems to be a contradiction, given the testing farmers must go through and the various hygiene standards with which they must comply.
On the Fischler proposals, I am aware the Minister is facing tough negotiations in which I wish him well. At times I wonder about the guidance he receives, given that the IFA has now completely changed its position. He was getting a different story a short time ago. I have just heard the ICMSA giving a very good presentation. When the Minister seeks guidance from farming groups and receives different signals, it is difficult to make the correct decision. Farmers are telling me that they favour the Fischler proposals but with certain modifications. If I was to select one, it would be modulation and the low level of €5,000. I am sure no one would mind if farmers getting upwards of €100,000, €200,000 or €300,000 in subsidies were to contribute a greater percentage to rural development. I find a great leaning generally towards the concept of the Fischler proposals. Listening to my colleagues, I realise that the current system is not working to the advantage of farmers and believe big change is coming.
I am pleased at the decline in the level of disease. It is about time, because the country has been through a very rough time. I congratulate the Minister on his guidance during the food and mouth disease outbreak which I hope will not recur.
I have nothing else to contribute on the Estimates because my colleagues covered many issues. I just want to say the burning issue at present is the Fischler proposals. I wish the Minister well in the negotiations.
I thank the Minister for his presentation and apologise for being a little late. It is an understatement to say the farming community and farming, in general, are going through a testing time, particularly small and medium-sized family farms. My party is in favour of the Fischler proposals, particularly the decoupling and modulation aspects. Modulation has a major role to play if ring-fenced for the development of rural communities.
All of us are acutely aware of the effects of modernisation on the farming sector and rural communities. It has meant that tens of thousands of farmers are being removed from the countryside. It is incumbent on all of us to ensure the measures introduced will take into account the survival of family farms, particularly small to medium-sized family farms, albeit on a part-time basis. Any policies implemented should take account of this aspect.
I support Deputy Upton's proposal in relation to helping developing countries to grow and compete. This may have some effect on Irish farmers but we must support in every forum, either nationally or within the European Union, those countries struggling to develop.
The debate on decoupling has brought about uncertainty within the farming community. I do not think the position taken on decoupling by leaders of the farming organisations was beneficial to the survival of the farming community, particularly weaker and moderate-sized farms. I am pleased that one of the main bodies has now done a U-turn in this regard and hope this will be reflected in the Fischler negotiations. While the CAP has benefited a large section of the farming sector, it has had the opposite effect on a larger sector. The Minister must take cognisance of this fact in the negotiations, the outcome of which must result in maintaining the fabric of rural Ireland by way of the survival of small and medium-sized family farms.
The Minister referred to individual traceability of cattle and sheep, which I welcome. However, food and animals are making their way into markets in Europe, including this country, which do not provide for individual traceability. I am referring, in particular, to cattle imported from South America. While there may be herd traceability, there is no provision for individual traceability. We need a level playing field in this regard. This point needs to be argued within the European Union to ensure whatever restrictions and accountability are imposed on Irish farmers and the European farming community, in general, also apply to anyone supplying food to the European food chain.
The Minister referred to the decrease in the incidence of BSE, which I welcome. However, I am also conscious of the fact that in County Kerry cattle under six years of age were discovered to have BSE, which is a worrying trend. I do not know how many cases have been discovered nationally but it is alarming to find the disease in cattle of that age when we thought they would be safe.
With regard to TB and brucellosis, when we debated the matter previously I suggested that an all-Ireland approach should be taken. There are farms spanning the Border but the restrictions and procedures on one side may not be reflected on the other side. An all-Ireland approach is needed. I compliment everybody concerned on the foot and mouth disease procedures. In that situation the authorities on both sides of the Border worked well together to deal with the problem. It is an example for us for the future.
The figure for salaries, wages and allowances has increased form €181 million to €189 million. What is the reason for this? There is also an increase in the Estimates for consultancies.
With regard to Teagasc and the tremendous work it does in research and testing, the committee was given an alarming presentation recently which showed that premises and farms had to be sold in order to meet the outlay costs for the year. That is fine for this year but if one has to sell assets to meet the daily running costs of the organisation, what will happen next year and the year after? Where does this stop? Obviously, every member of the committee raised his or her concerns about the closure in Ballinamore.
I thank the Minister for his presentation. The forthcoming negotiations are probably the most important he or the Government will have to endure. They will affect the farming community for the next ten years and how it develops. I wish the Minister well.
I am glad to have the opportunity to address some of the matters raised by the Minister. Obviously, the Fischler proposals should be uppermost in our minds as we move towards the end of June. It is a critical juncture for the agriculture sector which is nervous about change but also anxious to know the full story, with no hidden agendas, in order that everybody will know where they stand and what the future may hold, in so far as that is possible.
The percentage of the price of food that goes to the farmer is steadily decreasing. This is unsustainable and putting extreme pressure on the viability of farming. I also fear that cutting corners, in terms of standards, will be more difficult to avoid for those being pushed to the pin of their collar. It is worrying to see the multiple retail outlets being so ruthless in competition with each other because the farmer is the one who will ultimately suffer to the greatest extent. I have not seen the end of year profits of the multiple retailers being damaged in recent times.
We must also deal with perennial problems such as BSE. The Minister has said he is confident that it will be eliminated. That is good to contemplate but I am not convinced that we are out of the woods in that regard yet. How can the Minister be so certain? Like Deputy Upton, I believe we need to be up to date on these matters. A number of farmers have asked me the reason there has not been more debate about Johnnes disease. Some farmers call it Johne's disease. This degenerative disease, which is notifiable, appears to be taking hold in a number of herds. I urge the Minister and his Department to give it their serious attention to prevent its spread and deal with its causes, which might be deeper and more systemic.
A sum of €9 million is being provided this year for storage and incineration. The total sum is €140 million. The Minister mentioned the EU scientific steering committee making a decision on alkaline hydrolysis. At a number of previous meetings he said he would love to act but the steering committee had not yet made a decision. As I understand a decision has been made, we should get moving and give the opportunity, available in the United States, to farmers to dispose of special risk material. It is also capable of dealing with radioactive material, according to what I have read, although I hope we will not have great need to dispose of it. Deputy Upton, however, is more expert on the issue than me.
We will miss Teagasc offices, regardless of what the Minister says about being able to maintain services. From a social as well as farming point of view, the office in Lusk will be sorely missed. That will be the case in many areas. The Minister says services will not diminish but will they be able to expand in line with demand? Many growers in my constituency are facing restrictions with regard to pesticide use. Since they must use applications that are not as strong, they have to use them more often. This has a human health impact because they are applying chemicals more frequently. The health of farmers is being adversely affected. At the same time, they are trying to find out, because they see the writing on the wall, if they can convert to organic production. Some would find it easier than others. Some producers of brussels sprouts do not believe the aphid problem can be successfully addressed organically. Others, however, could convert and should be given the necessary training but Teagasc does not appear capable of doing this, at least sufficiently, at present.
The Minister said market orientation is a critical part of the NDP, a matter about which I have talked to officials in the Department in the context of developing local food outlets. I have in mind the international trend of increased numbers of farmers' markets. However, officials tell me the Department will not get into this. It does not seem to be one of the Minister's interests. However, we should explore it further. As the power of the supermarkets is relentless in this area, farmers need an alternative that will provide some competition for supermarkets with regard to pricing and so forth.
Premium based supports are handicapping the marketability of farm produce. Understandably, farmers are focused on getting their premium payments and cannot think about the demands of the market and the customer as much as they should. Decoupling should be considered in this context in order that we will not have a botched job of partial decoupling which maintains the bureaucracy but does not give the assurance of the premium payment to farmers with high stock levels and so forth. There is a need to come clean about this and say whether we will opt for complete decoupling.
The Minister's IT strategy also begs the question as to whether bureaucracy, as it relates to farms, will be reduced to a minimum under the reform of the CAP.
I understand that Germany and Switzerland - I accept that the latter is outside the EU - have decided to proceed unilaterally with a ban on battery cages. There is an understanding that this ban will apply across the EU by 2012. Will the Department of Agriculture and Food take pre-emptive action on that matter?
Involvement in fur farming is quite low in this country, but even that level of activity does not help our international image. Apart from the escaped animals that cause problems in terms of TB, etc., the animal welfare issues relating to fur farming cannot be overlooked and the activity should be banned. Has the Minister given any consideration to this matter?
I will be brief because most of the points have already been covered. I welcome the Minister and his officials. I congratulate the Minister because we often hear cynical criticism of him and his officials. When the Minister is not present, he tends to get his fair share of bashing.
It is generally fair.
It is recognised that he is doing a good job. I have attended meetings outside of politics and I have been very disappointed to hear some of the criticism levelled at Ministers and officials. It is very unfair. I compliment the Minister and his officials.
People in my constituency are deeply involved in poultry farming. There is great concern about imports of poultry from non-EU countries and, in particular, traceability. I raised this issue previously. Small farmers are very much involved in this industry and when their farms are not viable, they can make a living from poultry. They are extremely concerned about these imports.
Much has been said about the Fischler proposals. I also wish the Minster well in the negotiations. In recent weeks, people who have taken advantage of the early retirement scheme for farmers have become concerned. Under the Fischler proposals, people availing of the scheme - which allows them a nest egg when they are aged 60 or 65 - will find that the premium payments will go to the person leasing the land and not the person who owns it. That is not just. When these people decided to retire and avail of the scheme, the opposite was the case and the premium payments went to the land owner.
When the people to whom I refer approached me on this matter, I asked if they were receiving the support of the farming organisations. They stated that they were not receiving such support. I found that strange because these people have spent their lives farming and they are now being boycotted. I would not like to repeat some of the comments they made because I would be afraid that I would be the subject of litigation. I would like the Minister to give serious consideration to this matter.
I agree with Deputy Upton that the role of women in agriculture is important. The role of women on small farms, in particular, is never recognised. As we say in the country, they are out dredging from morning until night. I assure Members that they are not well paid. The point was made at a number of meetings I have attended that nobody speaks on behalf of these women.
Teagasc is an important organisation. Despite the financial constraints on the Department of Agriculture and Food, the Minister gave Teagasc a 5% increase on its 2002 budget. I do not know why it had to sell much of its land and property. That is mind-boggling. Teagasc was one of only organisations granted a 5% budget increase. Regardless of whether we are Members of the Oireachtas or otherwise, we do not always get what we demand. Perhaps the Minister might comment on this matter.
I again compliment the Minister and his officials, particularly on the excellent job they did during the foot-and-mouth crisis. Full co-operation was received from many people who had no interest in agriculture. The Minister went about that matter in the right way; he encouraged people and put the countrys best interests first. I thank him sincerely for that.
Under subhead C1, which covers TB and brucellosis schemes, there is an allocation of €67 million. Does that include the buy-out of herds from affected farms? I welcome the reduction in the incidence of the disease. I support Deputy Upton and others who have spoken about this issue. The efforts to eradicate TB, in particular, have been going on since I was at school. I do not want to say how long it is since I left school. Brucellosis has been eradicated and returned on numerous occasion. Good work has been done in that regard. However, the eradication of TB has become an industry and, as long as that remains the case, I do not believe it will ever be fully eradicated.
Members of the committee visited Hungary recently. While there, I asked about the eradication of TB in that country. We were told it had been eradicated. There are fewer cattle in Hungary - slightly less than 1 million - than there are in Ireland. We were told that in Hungary the disease is spread by foxes, while in Ireland we are told it is spread by badgers. If foxes in Hungary carry the disease, I do understand why foxes in this country are not also carriers. The veterinary experts in Hungary told us that they eradicated the disease by using helicopters to spray antibiotics on to animals in the wild that were infected with TB. They were very confident in their claims. If that can be done in one country, I do not understand why it cannot be done in other countries. Perhaps the veterinary experts from the Minister's Department should travel to meet their counterparts in Hungary as soon as possible to investigate their methods.
With regard to Johne's disease, is the Minister considering culling affected bull herds? This disease has a severe effect on the welfare of animals and on the financial situations of the farmers involved. Will he consider introducing a scheme of culling?
Deputy Timmins referred to imports of beef to this country. It has been reported that meat factories are importing beef in an effort to keep down the price of Irish beef. If that is true, it is a disgrace and should not be tolerated. The animal health controls in operation in this country are stringent and I must compliment all concerned in that regard. It is unacceptable that Ireland should import beef from countries which have less effective controls than ours.
I share Deputy Upton's concern regarding stray horses. While it may be an unusual problem in rural areas, it is occurring in my area. County councils are supposed to have responsibility for the control of stray horses. However, they are not exercising any control and it is time the Minister and his Department gave serious consideration to removing that control from them. In my area, it took the county council three years to take action on a problem with stray horses and, even then, the action taken was very limited, despite my pointing out to the officials concerned that they might be forced to take firmer measures in the event of a serious road accident arising from this problem.
With regard to the over-run of premiums, what is the current situation and what developments does the Minister anticipate? What are the prospects of compensation at a later stage for the farmers concerned? I am aware that the Minister and his officials have raised the issue in Brussels and I would appreciate information on the up-to-date position.
I wish the Minister well in the mid-term review at EU level. On Monday last, the clerk to the committee and I attended a meeting of agriculture committee people from across the EU, at which there were indications of strong support for Commissioner Fischler's proposals. It was also evident from my discussions that the Minister, Deputy Walsh, is highly regarded in EU circles and I believe his views on the mid-term review will be taken into consideration. I wish him well in the difficult task ahead, both in the mid-term review and the WTO negotiations. As I pointed out to Commissioner Fischler, the WTO negotiations should have taken place before the mid-term review. However, he disagreed, maintaining that the EU will have a strong hand in the WTO negotiations.
I would welcome the Minister's comments on the points which I and other Deputies have raised. First, however, we will deal with the various subheads of the supplementary estimate. Is that agreed? Agreed. Are the provisions in subheads A1 to A8 agreed? Agreed. Are the provisions in subheads B1 to B3 agreed? Agreed. Are the provisions in subheads C1 to C4 agreed? Agreed.
What is the position with regard to the Department's policy on scrapie? Has that policy been finalised yet? Perhaps the Minister would comment on that matter. I also wish to refer to a few other points later in the meeting.
Does the Minister wish to deal with that question now or later?
I will include this question in my reply to the debate, if that is acceptable to the committee.
Is that agreed? Agreed. Are the provisions regarding development aid in subheads D, E, F1 and F2 agreed? Agreed. Are the provisions regarding pension payments in subheads G1 to G3, inclusive, agreed? Agreed. Are the provisions regarding schemes operated in implementation of quarantine regulations under subheads H1 to H7, inclusive, agreed? Agreed.
As regards subhead H5, the early retirement pension, has the Minister any plans to increase the level of farm retirement pensions? Perhaps he will comment on that in his reply to the debate.
Are the provisions regarding schemes operated in implementation of EU structural regulations, subheads I1 to I3 agreed? Agreed. Are the provisions under subheads J1 to J9 agreed? Agreed.
Will the Minister indicate if he intends to reduce disease levies?
As regards subhead J9, what is the reason for the significant reduction? Will the Minister also comment on the position regarding animal welfare organisations, under miscellaneous services?
Are there any other questions before the Minister responds to the debate?
Was the position with regard to tendering for cattle tagging discussed?
Yes, it was discussed. I call on the Minister to reply to the debate.
I thank you, Chairman, and members for their contributions to this useful discussion and overview of the farming situation and the position of agriculture in the national economy. We need to bear in mind that agriculture is still our primary industry, accounting for about 9% of GDP, almost 9% of employment and about 27% of our export earnings. Accordingly, it is a critically important industry. We are now at a stage where the future of the industry is being challenged in terms of the direction it will take in future years. The mid-term review and the World Trade Organisation negotiations are about the direction of the industry, more than financial issues as such.
In the last round of negotiations on Agenda 2000, the issues related to the level of special beef premiums, headage payments and, in general terms, the financial return to Ireland from those negotiations. In the present negotiations, the issues involve decoupling, modulation, degressivity and other such matters affecting the future of the industry. The present indications from most farmers, farming organisations and a general cross-section of members of this committee are tending towards approval of full decoupling. Full decoupling has fairly serious repercussions for the industry. First, on the positive side, it means that farmers can get payment without the need for bureaucracy and red tape. They will not be required to buy or sell cattle at particular times of the year or to adhere to retention periods. They will not have to engage in, possibly, loss-making operations such as having to finish cattle in order to collect subsidies. They will be in a position to collect their premia without such requirements.
From an overall national point of view, we are 1,000% self-sufficient in beef. Having encouraged farmers to fatten cattle and retain them, we have difficulties in finding market outlets. In the last few years, we have been fortunate that the UK market has been very good, taking up to half of what we produce. We also sell considerable quantities to other EU member states and to Russia. However, there are considerable quantities for which we are trying to find a home and invariably we have to ask the Commission for subsidies to dispose of them it rather than market them. That leads to the difficulties mentioned by Deputy Upton about developing countries and least developed countries. We support, promote and encourage the finishing and retention of cattle in the country in order to collect subsidies and use export refunds or export subsidies for dumping or disposing of the finished product, sometimes at the expense of developing or least developed countries. It would obviate that particular problem also which has implications in the context of the WTO negotiations because there will be pressure on export refunds, not least because of the damage done to developing economies. We want to protect support for Irish farming and Irish agriculture. By decoupling the payments, by breaking the link with production, those payments can be protected in the context of the WTO negotiations. All those are in favour of decoupled payments.
A growing number of people have jobs outside of farming and either spouse is working. They are trying to keep the farm going in the evenings and at weekends. Decoupled payments would give greater flexibility to those in rural areas to live on the farm and carry out whatever type of farming they felt comfortable with and from which there was a return from the marketplace, as opposed to collecting premia on it. There are a number of advantages in decoupling.
The disadvantages are that there would be a considerable reduction in the national herd, the suckler herd and the sheep flock, all of which would have serious implications for animal feed supplies and various other requirements on farms. If farming was not carried on, various stores in towns and villages around the country that supply farmers would have less to supply. At the other end, in the factories and abattoirs there would be less throughput so that would have a negative effect in that area. We sought to establish the overall effect by having economic models drawn up by Teagasc with FAPRI. Those economists produced two reports, one in January 2003 and the other a week ago. Both reports suggest there would be a substantial decline in the suckler herd - the last report suggested a decline of about 16%. There would be a reduction of 7% to 8% in the ewe flock. The decline in both cases would not be too dramatic because farmers would still have an incentive to farm but to farm in niche products such as high quality food products for which there is a market. On balance, the majority of people are in favour of decoupling.
Within the European Union the position is that a majority of the member states are in favour of partial decoupling. Neither the member states nor the Commission have spelt out what they mean by partial decoupling. Partial decoupling is a tricky formula because one could couple 50% of production and decouple the other 50%. That would leave one with all the red tape, bureaucracy, deadlines and criteria attached to the current system. Partial decoupling could take out some enterprises. For example, if one was worried about the suckler herd, one could leave it coupled to payments. My Department and Teagasc are examining a number of models on the different types and impact of partial decoupling, whether horizontal or vertical. About 11 of the 15 member states are in favour of decoupling of some kind or another.
Modulation is the other main aspect of the mid-term review. Modulation is interesting enough. The downside is that modulation or a reduction in payments clicks in at a threshold of €5,000. That is quite a low threshold. We will argue for a much higher threshold to exclude smaller farmers. It is hard enough to make a living in farming without having one's income reduced. We will try to increase it from €5,000 to €50,000. Over seven years there would be a reduction of 12.5% in payments and from €50,000 upwards there would a reduction of 19%. Most people would not lose sleep over the high income earners having some of their income reduced or diverted to other areas of activity. The whole idea of modulation is to take some of that money from direct payments and put it into another pillar - the rural development pillar. That has been alluded to by a number of members of the committee - the retention of the small and medium farmer, farming as we know it, what the Europeans call multifunctional agriculture.
Modulation would have a place and a role because it would put that additional funding into rural development activities. They have not been spelt out to any great extent yet by the Commission. We have a meeting of the Council of Ministers next week and a further meeting in June. By the end of June we expect considerable development in the mid-term review and in the negotiations but whether there will be a conclusion remains to be seen. Ireland is only one of 15 member states and has only three votes out of 87. There is an acceleration in the negotiations and a greater desire to get a conclusion to the round because many farmers are uncertain about the future. The matter is in mid-air, they want to know where they stand and want to plan for the future. If we get a good deal it would be attractive to get it concluded as quickly as possible. If not, we will dig in and get the best possible result. The whole future of farming and the future of the industry is at stake in these negotiations and in the mid-term review.
There is also the world trade talks and enlargement. The next key meeting in the world trade talks takes place in Cancun in Mexico in September 2003. The world trade talks will have major implications for Irish farming and Irish agriculture because the support for agriculture and direct payments will come under pressure. That is why some people want them decoupled. The decoupled payments or direct payments in Ireland last year amounted to €1.6 billion, which made up about 60% of farmers' incomes. If that €1.6 billion, or 60% of farm incomes, was threatened we would have a severe problem.
The other matter which will come under considerable pressure is export refunds or export subsidies on which we depend for the export of beef and dairy products. Decoupling would be helpful because if export refunds are diluted or got rid of, which is what the WTO wants, and there is a reduction in output, we will not need export refunds to the same extent as at present.
The Fischler proposals, raised by a number of Deputies, are critical. We want to get the best possible deal and protect the gains of Agenda 2000. We aim to ensure there is multi-functional agriculture of the type that will retain small and medium farmers on the land. We can underpin agriculture for the future with a combination of decoupled protected payments up to 2015 - the kind of timespan envisaged - and an enhanced rural development pillar.
Deputy Timmins raised a number of other matters, some of which are technical such as that relating to the retirement scheme and where people stand in regard to it. It is a serious matter and we have not yet had the position clarified by the Commission. The reference years for the mainline decoupled payments are 2000, 2001 and 2002; in other words, if a farmer received premia in those years, the average payment would be the yardstick for future payments. Some matters have yet to be ironed out in regard to those who did not receive payments in those years such as those involved in the retirement scheme or those who had leased land - it is not clear whether the lessor or the lessee will have entitlements. Young farmers who acquired land or bought farms in the past year or year and a half are most concerned about where they stand. We need to have fairness and equity in regard to these matters. All of these technical matters will be taken into account. The final critical meeting during the Greek Presidency will be held in the latter end of June. If the committee wishes to have a technical presentation on these matters prior to that meeting, we will be glad to arrange it.
The strike is another of the issues raised by a number of Deputies. There is a strike by departmental staff in a number of centres in four parts of the country, the detail of which is quite well known. It is contrary to partnership and should not be taking place as there are mechanisms for resolving issues such as this. Notwithstanding that, officials of the Department of Agriculture and Food and the Department of Finance are engaging with the trade union involved - the CPSU - in order to find a solution which we want to find to see staff back at their places of work providing services for the industry - farmers and the agriculture sector, in general. It would contribute greatly to goodwill if the staff concerned adhered to the mechanisms available under the partnership arrangements. I am as aware of the difficulties as anybody else - probably more than most - that this is causing to individual farmers. We are trying to find ways to reduce the inconvenience, particularly to farmers who need to sell or transfer stock. We have received co-operation from staff in regard to hardship cases concerning animal disease. One could imagine the potential problems caused if a herd could not be depopulated in the case of a disease such as brucellosis.
A number of Deputies raised the matter of TVI, temporary veterinary inspection, an issue we need to address. Inspections at meat plants by temporary veterinary officers are costly. They operate on a four hour shift system that is costing a huge amount of money. We are in discussions with the industry and the relevant people to find a better way of providing inspections at meat plants; one which would suit everybody but, particularly, one that would maintain the high health status of our food and food products. The public health aspect has to be kept to the forefront. Over the next couple of months there will be intensive negotiations and I hope we can find a way of resolving the matter. A root and branch reformation of the service is required.
The issue of imports of beef from third countries has been raised. It is a cause of much anxiety and concern. As I mentioned, although we are completely self-sufficient in beef, considerable quantities are imported. We produce some 500,000 tonnes of beef, about half of which we export to the United Kingdom. Somewhere between 85,000 and 90,000 tonnes goes to Russia while some 130,000 tonnes goes to the European Union. For those good at sums, that should leave some 45,000 to 50,000 tonnes which are consumed by the domestic market.
Most of the 12,000 tonnes imported is for use in the convenience food industry and the catering sector. It is used by the convenience food industry as toppings for various dishes. Meat sold through a retail outlet or butcher's shop must comply with the provisions of the traceability and labelling system. However, the situation is less clear in regard to the catering and convenience food market where there is not the same degree of follow-through and labelling. I initiated a review study of labelling last year because of my concerns in this regard. That report was finalised and produced before Christmas. I subsequently set up an interdepartmental group to look at ways of tightening the area of labelling, which, incredibly, is the responsibility of three or four Departments and agencies. The same applies in regard to the humble potato. New potatoes will be out shortly and one will really not know where they were grown. I want to have the matter tidied up once and for all.
In recent years a Commissioner has been appointed with specific responsibility for public health and consumer protection, currently Commissioner David Byrne, with whom I continually raise the question of safety, hygiene and the quality of food in the European Union. Due to the Single European Act some of the food imported into the European Union can end up here. Processed foods have been discovered with various additives, including other forms of protein, or sometimes water added, I assume to increase the weight of the product. We want to ensure food contains the ingredients shown on the label; that they are natural ingredients and that beef or poultry protein is not replaced by soya protein and so on. We also want to ensure it is microbiologically and hygienically safe for consumers to eat. I am assured by the Commissioner that his officials go to considerable lengths to ensure the food imported into the European Union is monitored and that spot checks are made. There is regular sampling and laboratory analysis. Personnel from the services involved travel to the various countries from where the food comes, such as Brazil, to inspect factories and ensure there is full traceability. We are given constant assurances in this regard. As I said, a study of labelling was carried out and I would like to ensure matters are tightened up even more.
The national beef assurance and national herd certificate schemes have been raised. The national beef assurance scheme, being implemented by means of traceability and tagging, is working very well. The on-farm inspections element has not come into place, however, because the veterinary union is refusing to co-operate, essentially because it wants to be paid by the taxpayer, not the farmer. Plugging into the national Exchequer would be much easier for vets than going to farms for a round test and a livestock examination, certifying the herd's health as being of a high standard, writing the bill and being paid by the farmer. The veterinary union wants to make an industry out of this by plugging into the Exchequer but I do not propose to facilitate it in that regard.
There is a fairly similar situation in relation to the dairy certificate. It is similarly outrageous that the veterinary representatives are dragging their feet and refusing to co-operate. They are jeopardising our exports as one needs a dairy certificate to export certain products to certain destinations. We have gone to considerable extremes in discussions and negotiations with the veterinary union in order to implement the schemes. Sadly, they have not been implemented so far but we are continuing to work on them. The industry, including the ICOS and the farming organisations, are working with us to get this done.
Teagasc, which does a good job in research and development, advisory services and training, has been mentioned by a number of speakers. It has grown considerably in recent years, particularly in the last decade. Its Exchequer allocation has increased each year, from about €78 million in 1998 to about €98 million this year. Deputy Collins mentioned that there was a 5% increase last year. As about 70% of Teagasc's expenditure has been accounted for by salaries and wages, the various increases have been gobbled up by benchmarking and the different pay rounds. Teagasc needs to streamline its activities, which is what it is now doing. If that is not done, it will become insolvent. It still has 70 units throughout the country, including about seven major research centres and the agricultural colleges. Not only has the Exchequer allocation for current spending increased in the last four or five years but considerable capital investment has also been made available. Teagasc has used this capital expenditure to improve and upgrade its centres and agricultural colleges.
I take the point made by Deputy Upton in relation to research and development and product and process development. We are lagging behind our competitors in that regard. It has been a while since I saw a breakthrough in terms of product or process development in the food industry. The amount of new products or processes is minuscule in relation to the size of the industry. We have considerable exports of food and food products. Four or five years ago we had star performers in the area of prepared consumer foods which saw huge increases. Companies like Green Isle Foods and Custom Foods made great strides - Ireland was probably the pizza capital of Europe at one stage - and the Kerry Group led the way in ingredients for incorporation into a range of food products. Research and development, whether conducted in-house, by Teagasc or universities, has slowed in recent years, however. I would like to see increased momentum. It is important, therefore, that Teagasc should streamline its activities in such vital areas. Research into new products and process development should continue.
Education and training are absolutely vital. Farm leaders, especially, do a disservice to farming and the industry by continually talking it down. I do not know of spokespersons in any other profession or occupation who continually talk down their industry. More young people entered agricultural colleges and pursued agricultural courses in 2002 than ever before, in spite of the bad-mouthing of the industry. If one picks up the farming newspapers such the Irish Farmers Journal or the farming section of yesterday’s Irish Independent in the Oireachtas Library, one will read details of the prices being made by farms. They are selling for up to €20,000 per acre. I do not think anybody in this House could afford such money, with the possible exception of the Chairman.
Perhaps the Minister can afford it.
I compliment the young people making such an investment in the future of farming.
Deputy Upton raised the question of retaining people in rural activities such as rural tourism. I have alluded to the fact that modulated payments will go to the second pillar for rural development which I hope will give a shot in the arm to a number of schemes. The Deputy also mentioned e-business, particularly broadband roll-out, in regard to which Eircom should pull up its socks. A large allocation has been made to it and its lethargy and procrastination is unsatisfactory. People living in rural areas do not have a chance if they cannot have the same IT facilities as those living in the larger urban areas. If a company in a technology park in a town in the west or elsewhere in the BMW region cannot process data in the same way as it could in Dublin, where ERS and broadband facilities are available, it has no chance. If it is charged every time it uses the Internet, without having an "always on" facility, in place in the larger urban areas, it is at a huge disadvantage. Rural areas will be disadvantaged if they are not given the IT facilities they need.
Deputy Upton is an expert in the area of food safety. I am not sure, therefore, if I should comment at all in the face of such expertise. We are putting a great deal of resources into food safety, responsibility for which, under legislation, comes within the remit of the Department of Health and Children. The Food Safety Authority of Ireland has that remit, but the Department of Agriculture and Food has a staff of more than 4,000, almost 2,000 of whom are engaged in food safety and regulatory activities. We do that under contract to the Food Safety Authority and the Department of Health and Children.
Deputy Upton also raised the issue of women working in agriculture. We have made great strides in this area. I recall a time when there would have been various discussions at ICA meetings about the woman's place and it usually came down, on a show of hands, to the fact that the woman's place was in the home - not tied to the kitchen sink, but not too far away from it. The main aspect was that the women would look after the menfolk doing the hard work on the farm and so on.
We have made some considerable improvements in this area. I was sufficiently concerned about this matter to institute a study on it. That study was produced about a year and a half ago and I am glad to say that most of its recommendations have been or are being implemented. A copy of the study is available to any Member who wants it. If we need to review the study, I will be glad to arrange for that.
Under many of our schemes, farmers are obliged to pay PRSI usually from the age of 55 up to 65, when they reach pensionable age. Members will be aware of widows who come to their clinics to complain that they cannot get their pensions and asking for help. When they are asked if they have PRSI, they invariably say that, unfortunately, it was "himself" who paid the PRSI and that they do not have any. If "himself" went to the bother of making sure the PRSI was paid on behalf of his spouse, there would not be a problem because they would be entitled to their pension, as of right. However, it would cost a little more to ensure that both spouses had their PRSI payments and that women, who not only looked after the house but sometimes the farmyard, the lands beyond and reared children, were left high and dry. They were then given a means-tested, non-contributory pension, which was totally unfair. I feel strongly about this victimisation, which still exists.
We have made some improvements. Women were generally described in social welfare literature as adult dependants. In other words, they were dependent on "himself" for anything that was going, but, worse than that, if they were not described as adult dependants, they were called "others assisting". They were usually referred to as the spinster who might be left unmarried on a farm and they usually did more to bring up the younger family members than anybody else. They were left high and dry. Much of that derogatory description has at least been removed from our literature and various schemes, but we have a long way to go in that regard.
We are making good progress on eradicating brucellosis and TB and thankfully the numbers are reducing. I hope that we can continue with the progress that has been made. A major part has to be played by farmers, and biosecurity on farms is the responsibility of individual farmers. They cannot expect everybody else to look after their biosecurity for them. Brucellosis is an infectious disease. Most farmers are highly responsible. However, a small number of them are downright irresponsible. They go to marts and places where livestock are assembled and they take little care in buying in animals into their herds. Sometimes they go to dealers and look for a particular animal and they have little idea about from where the animal comes and what the circumstances were in that particular place. A great deal of onus remains on individual farmers in respect of these diseases. However, we are making progress.
The tightening up of the regulations during the foot and mouth crisis, with the increased use of disinfectant and so on, was a contributory factor in the improvement in eradication of brucellosis, in particular, and in TB, with the putting in place of an improved traceability system. We have reduced the amount of trafficking in cattle and the bed and breakfast type of operation that was practised. As members will be aware, livestock here are moved from farm to farm to a far greater extent than in nearly any other European country.
The question of Johne's disease was raised. I am glad that it was because this serious disease is something of a time bomb. There were about 90 cases of Johne's disease in the 50 years up to the mid-1990s. Last year, however, there were more than 100 cases in 34 herds. It is alarming that there have been more cases of the disease in one year than there were in the previous 50 years. Farmers need to be careful about where they get their stock from. A good deal of stock is imported, sometimes from other European countries. When farmers have a disease breakdown, they sometimes replace their herds with imported animals. They need to double check such animals and ensure that the health certification relating to them is up to a high standard. I have established a group of experts, comprising officials from the Department, those involved in farming and others, examine this matter closely before it becomes a real problem.
My difficulty with the control of horses usually applies to the final furlong. That is very difficult. The strike rate has not been great in recent times.
Deputy Finucane was very good at them in Limerick at one time.
Yes.
I had meetings with some local authorities, particularly in Dublin, a number of years ago. We established a centre in Cherry Orchard, which is working quite well. Many of those young people who were riding horses bareback were better than some of the jockeys I fancied to ride horses. Those young people were getting little enough encouragement or support. I got them involved with the local authority, which secured some stabling and other facilities for them in Cherry Orchard. I also got them involved in training at the race centre in Kildare and I am glad to say that a number of them have participated in the jockey apprentice school and are doing extremely well. They have a particular expertise in that area and that should be availed of, promoted and encouraged. There is no point in asking people who have a particular expertise in an area to do a PhD in some other area of activity.
The Chairman has also developed some tremendous expertise in that regard and Barry Geraghty, Johnny Murtagh and others are credit to us.
We are proud of them.
They are world class. We have devolved much of this responsibility to the local authorities. I will take up the matter of the local authority mentioned, but, in general, this activity is working reasonably well in the local authorities
Deputy Upton and others raised the question of our attitude to developing countries, the difficulties created by subsidising the export of product to developing countries and the need to ensure that those countries have opportunities. We contribute nationally to development funds for developing countries, least developed countries and sub-Saharan countries. I am glad that the allocation nationally has increased over the past few years. In Europe, we have taken a number of measures, particularly in regard to the least developed countries. In anything but the arms agreements we have reached, we are giving least developed countries full access to the European Union in respect of anything they can produce. That is a good measure. The European Union as an economic bloc is the largest food importer in the world. We import more from developing and least developed countries than the United States, South America, New Zealand, Australia, Japan and the Pacific rim together. We will continue with that clear obligation we have on ethical grounds to ensure the least developed and developing countries have a chance.
I have dealt comprehensively with the issues of the Fischler proposals and food safety. Deputy Ferris raised a number of issues regarding decoupling and maintaining small and medium-sized farms. I have referred to that.
Deputy Ferris and others raised the issue of BSE, especially in regard to animals born after 1997. There have been seven cases of BSE in cattle younger than seven years of age. They were all born in 1997 except for two cases in the Limerick-Kerry region which were born in 1999. It is extremely difficult to reach a conclusion on the cause or factors and we have been unable to do so in any of the epidemiological tests we have conducted. There may be a number of factors, such as old food possibly adhering to the side of old bins and silos. We do not know. There probably will always be a sporadic case or two. We must remember that we have 7.2 million cattle and two isolated cases constitute an extremely small occurrence of the disease. The main point is that overall numbers are decreasing substantially. I hope that will continue and we have every reason to believe it will and that we can rid ourselves of this problem. There is no doubt the controls and restrictions in place are comprehensive and are having the desired effect. We know the age profile is getting older and is improving and that the number of cases is reducing. With active surveillance, there is more testing of fallen and casualty animals. We are picking up more instances now than before.
Deputy Sargent raised a number of matters, including the Fischler proposals. The price of food is a problem. I wonder about some studies and programmes examining the price of food. They attach much of the cause of the high price of food to producers. That is not the case. In many cases there is a greater mark-up in retail outlets than in any other part of the chain. As the Deputy knows, a result of the MacSharry reforms is that, instead of subsidising or supporting the product, producers receive direct payments. They are not a main contributory factor.
It is difficult to see how the price of food can be reduced. I know my colleague, the Tánaiste and Minister for Enterprise, Trade and Employment, is examining this matter and measures such as the groceries order. I am not sure what those studies will produce, but they all form part of an attempt to see if food prices can be reduced. We all know that the price of raw material and the price farmers are paid for a kilo of beef, horticultural products or a litre of milk is such that, when compared with the retail price, it is obvious there is a significant mark-up. It is something that needs to be addressed.
Deputy Sargent also raised the issue of disposal methods of animal waste. This is a significant problem. There will be by-products and waste from industry which need to be disposed of. The most difficult by-product we have is offal, especially meat and bonemeal. That is a problem and taxpayers have forked out a great deal of money to store and dispose of it in other EU countries, such as Britain, Germany and France. Other EU countries use certain industries as means of disposal, such as thermal treatment for the production of energy in the cement industry and the generation of electricity. We have not yet been able to do that in Ireland.
The Deputy is correct to say we were waiting for EU approval of alkaline hydrolysis for some time. It recently approved the procedure as a means of treating meat and bonemeal. Our difficulty is that the approval was not extended to specified risk material. It is approved as a method of disposing of ordinary meat and bonemeal but not for SRM material. That is a difficulty for us.
We do not have a difficulty with the process once a system is in place that is approved by the Environmental Protection Agency and has the required planning permission. I am forever discussing this with officials and relating the Deputy's representations because he has spoken to me on a number of occasions about it. I know he has examined pilot schemes. We do not have a difficulty supporting alkaline hydrolysis as a means of disposal. It has some shortcomings in that only a relatively small quantity can be dealt with because of the amount of water and sludge left as a by-product. It is something that needs to be promoted in some way, perhaps as a fertiliser if it is certain that the prion is finally and comprehensively done for.
It would not be the first time we would have followed American policy.
The Americans are friends of mine.
They are friends of mine as well.
On the issue of country markets, I call to a country market in Clonakilty almost every weekend. The products on sale there are fantastic. It is situated in an old laneway and there are nice arrangements for some fabulous products. The next time the Deputy heads for the Mizen Peninsula or Fastnet, perhaps he might visit the market in Clonakilty. I think such markets are great and give them every encouragement.
On battery cages, we are aware of the ethical issues for farming. I understand a number of licences exist, but we do not promote the use of battery cages for farming. We have considerable regard for a high degree of animal health and welfare status. Irish people are among the best in the world when it comes to animal welfare. The people I know occasionally care for their animals marginally better than they do for themselves. They ensure that the animals are cared for before they themselves have a meal or go to bed.
I think I have dealt with all matters. If there are any I have not covered, I will be glad to do so. With regard to the mid-term review, the World Trade Organisation talks and the Fischler proposals, we would be glad to make a presentation on and go through the different aspects of them in detail.
I thank the Minister for giving a comprehensive reply. He has spoken for more than an hour and has given the committee a comprehensive overview of the position. I wish him well in the forthcoming talks. He has many skills as a negotiator and they will be needed in the forthcoming months. At another forum which the Minister attended I spoke about decoupling. I hope the Minister does not return from the negotiations with partial decoupling because that would not be good for the farming community. I am sure the Minister will devote a great deal of energy to that aspect of the negotiations.
I urge the Minister to get the strike settled because it is causing great hardship in the farming community. A man rang me today about it. He has 11 heifers and if they are not sold by next Monday, he will lose 25 cent a pound on them because they will be more than 12 months old. However, his cards are held in the DVO.
The Minister answered many of the questions but I raised some other issues. However, they are being raised in parliamentary questions which will be dealt with in the House tomorrow so I will get the response then. I thank the Minister and his officials for coming before the committee and I wish him the best of luck in the weeks ahead.
I also thank the Minister and his officials. I urge him to seriously consider the experience in other countries with regard to development. I attended a conference yesterday on the revitalisation of Irish farming at which international representatives highlighted the success of organic farming in Germany, Denmark, Austria and in up to 50% of the cantons of Switzerland. Participation in this country is apparently less than 1%. The potential of a clean green image must be harnessed.
In the WTO and during the mid-term reviews we will soon face a crossroads. Do we take the GM route which the Americans and the Canadians are encouraging us to do or do we capitalise on our natural advantages, particularly when there is consumer demand for the product? There is no consumer demand for GM products. We have to be clear in our policy and not try to straddle the fence to the extent that we are neither fish nor fowl in the marketplace. The Minister should consider declaring Ireland GMO free and let us move ahead by using our natural advantages.
Does the Minister have anything to add?
I will be glad to take up a number of the other issues mentioned, including scrapie, at Question Time tomorrow. Perhaps we could arrange a mutually suitable date for next month's meeting.
What is being done about the dispute?
There are ongoing talks with the unions. They should adhere to the mechanisms available. Nonetheless, we are talking with them in an effort to secure a resolution. We do not have a free hand in this matter because we must get approval from the Department of Finance for any concessions that are made.
Why were those people let go?
I have to cut the Deputy off. There is a vote in the Dáil and we must conclude our business. I am sure the Minister will deal with the matter. I thank the Minister and his officials for their attendance today. We will invite the technical group to come before the joint committee in June to discuss the mid-term review and its implications.
