SELECT COMMITTEE ON AGRICULTURE AND FOOD debate -
Wednesday, 31 May 2006

Vote 31 — Agriculture and Food (Revised).

Chairman

The Revised Estimates for the Department of Agriculture and Food have been referred to the committee by the Dáil for consideration. On behalf of the committee, I welcome the Minister for Agriculture and Food, both Ministers of State at the Department of Agriculture and Food and their officials. It gives me great pleasure to welcome Deputy Mary Wallace, my former constituency colleague, who is appearing before the committee for the first time as Minister of State. For every good man, there are two good women. I welcome the Minister of State and wish her well in the Department.

The clerk to the committee has circulated a timetable, which provides for opening statements by the Minister and Opposition spokespersons, followed by a question and answer session. I call the Minister to make her presentation.

Minister for Agriculture and Food (Mary Coughlan)

The Revised Estimates show a continued commitment to the agrifood sector, with significantly increased provisions in the major demand-led schemes such as REPS, early retirement, on-farm Investment schemes and forestry, and in key areas for future development such as research. These Estimates are, therefore, in line with the vision for the future articulated in the Agri Vision 2015 action plan. In all, the Voted Gross Exchequer Estimate for 2006 is almost €1.517 billion, including the capital envelope carryover of €18 million. This is €162 million, or 12%, higher than the 2005 outturn. In addition to the voted Exchequer funding, my Department is responsible for expenditure of EU funds on the single farm payment, and market supports such as intervention and export refunds. This expenditure takes place outside the ambit of the Department's Vote and is estimated at approximately €1.526 billion, mostly on the single farm payment, in 2006.

The single farm payment has been a major success story in Ireland and almost 90% of 2006 payments issued last December. Farmers are adapting to the new system and more than 135,000 applications have been received for the 2006-07 round. The successful administration of the scheme will continue to rely heavily on the co-operation of the farming sector.

I return to the issue of Voted expenditure. The administrative budget for 2006, at €286 million, is some 3% higher than the 2005 outturn. This increase results primarily from agreed increases in salaries, wages and allowances under Sustaining Progress and benchmarking, and from increased costs relating to office machinery, supplies, and IT outsourcing.

On the programme budget, almost €35 million is provided for research and training under subhead B in 2006. This is almost double the outturn last year and excludes other research funding to Teagasc and Coford, provided under subheads I and J, respectively. This expenditure is critically important for the continued adaptation of the agrifood sector to an era of increased competition. Key elements include €6 million for the research stimulus programme, which provides funding for research and development in production agriculture, environment and the rural economy, and €14 million for the food institutional research measure, which supports essential pre-commercial research and innovation in the food sector.

Subhead C funds measures for the protection of human and animal health, animal welfare and plant health. The 2006 allocation is just over €149 million, which is slightly up on the corresponding 2005 outturn.

There have been a number of significant success stories in this area in recent years, including the dramatic decline in the numbers of BSE and brucellosis cases. BSE case numbers have declined from 332 in 2002 to just 69 last year. This trend and the favourable age profile of cases continues for 2006. The committee will also be aware that we moved from whole herd to partial herd depopulation this year and this has been well received.

In the case of brucellosis, there were only 144 new herd restrictions in 2005, representing a fall of almost 50% on 2004. With the continued co-operation of all and the prudent sourcing of replacement stock by farmers, we can realistically look forward to early eradication of this disease. This does not imply, however, that there are grounds for complacency in this area. There is the continuing challenge of bovine TB and other animal diseases and the Department is alert to the continuing threat from the H5N1 strain of avian influenza. In this regard, the Department is working closely with the relevant bodies to ensure that we are ready to deal effectively, efficiently and in a proportionate way with any outbreak of that disease. While our record in this field is good, the provision of the necessary assurance to consumers on the safety and quality of the food they eat will continue to be a core priority.

Subhead D amounts to just under €26 million and covers technical and ancillary costs of some FEOGA operations. Subhead E provides over €238 million for disadvantaged area payments to more than 100,000 farmers. In addition, in 2006 applicants will benefit from the payment of some €18 million from modulated funds outside of the Vote, bringing expenditure to approximately €257 million.

Funding for REPS, in subhead F, amounts to over €322 million in 2006. This is a 14% increase on the 2005 outturn. It will be sufficient to meet demand at the increased payment rates introduced in 2004 under the REP III scheme. Subhead G provides €72 million for the early retirement scheme and €7 million for the installation aid scheme.

Under subhead H provision is made for grants for on-farm investment, horticulture, marketing and processing, development of equine and cattle breeding infrastructures and other schemes. Some €76 million is provided for this in 2006. The largest scheme under this subhead is the farm waste management scheme, which has an allocation of €43 million. This is over double the 2005 expenditure. A revised scheme was introduced in March, with a new standard grant rate of 60%, or 70% in the four zone C counties.

In addition, the maximum eligible investment ceiling was increased from €75,000 to €120,000 per holding and pigs and poultry have been added to the scheme for the first time. As the scheme closes for applications at the end of 2006, I urge those farmers planning investments to ensure their application forms are received by the Department in good time so as to avail of these attractive grants. I am examining the standard costings under the scheme and any increases will be applied to applications since the beginning of 2006.

Subhead I provides for a 2006 allocation of over €136 million for forestry, including €18.3 million in capital savings from 2005. This is a 24% increase over the €110 million spent last year. The 2006 allocation covers funding for annual premium commitments for existing plantations as well as for new planting in 2006. We are also looking at the potential for developing wood energy uses for forestry thinnings. The forests planted in the past few decades offer a source of alternative, carbon-neutral and renewable fuel. There is need to develop to maximise the energy potential of those forests and of biomass in general.

I am in consultation with the Minister for Finance on two new schemes, one to support the purchase of specialised biomass harvesting and processing machinery, the other to support the planting of short-rotation willow coppice as a source of energy. I hope to be able to make an announcement on these initiatives soon. The whole area of biofuels presents an important opportunity for the agricultural sector, one that we must be ready to pursue actively and effectively in the future.

Subheads J and K deal with the annual grant-in-aid payments to both Teagasc and Bord Bia. Their 2006 allocations are €122 million and €22 million respectively.

My Department's food aid contributions to the United Nations world food programme are in subhead L. All our food aid is given in the form of untied cash donations to the World Food Programme which uses this money to feed the hungry in the most effective way possible. Our total projected contribution to the WFP in 2006 is above the corresponding base allocation in 2005. However, in 2005, an additional €1 million in food aid contributions was made available by my Department, specifically to assist the UN world food programme in dealing with the emergency food crisis in Niger.

Subhead M provides a total of €16 million to cover a variety of headings, including miscellaneous pension payments, annual contributions to international organisations, beef classification, trade exhibitions and promotion costs and legal expenses. In 2006, it includes €1.9 million to cover the costs of independent on-farm inspections and associated certification processes under the Bord Bia quality assurance scheme for beef.

The 2006 allocation for subhead N is a nominal amount to cover any residual payments arising from last year's payments to farmers adversely affected by the special beef scheme quota overshoot.

On the receipts side, the 2006 Estimate for my Department, at just over €450 million, is slightly higher than that in 2005. The increase relates primarily to the expected drawdown of EU co-funding under the NDP for structural measures such as the farm waste management, dairy hygiene and other schemes. Members will appreciate that the scope of the Vote is broad and that the issues facing the Department and its stakeholders are complex and challenging.

There is scope for considerable discussion on each of the individual expenditure headings I have mentioned. The range of issues covered affects consumers, farmers, marts, the processing sector, transporters, exporters and many others. I have dealt with some of these issues briefly in my presentation, but I am, as always, at the disposal of the committee to deal with any further questions.

Chairman

I thank the Minister for her opening statement. Unfortunately, Deputy Naughten will be late because he is attending another meeting. I call, therefore, on Deputy Upton.

Dr. Upton

I welcome the Minister, the Minister of State and their officials. I will begin with some general comments. In an increasingly globalised market it will not always be possible for Irish farmers and food producers to compete favourably with other countries on scale. Against that background, we must put our emphasis on quality and this is something we will strive to achieve. The Irish agriculture and its downstream food industry have already proved their ability to compete successfully on world markets in terms of quality. We should build on that success to maintain current markets, promote our products and generate new markets abroad.

I wish to make some points about the importance of assistance for farm families in terms of their survival in rural communities. Such communities are becoming less dependent on agriculture and other aspects of rural Ireland are becoming more important. Provisions such as the farm assist programme and the rural social scheme should be developed further. They should be more widely available, more user-friendly and more proactively promoted to the farming community.

I wish to place some emphasis on the importance of farmers' spouses and partners. That the same rights as the self-employed, in respect of social insurance benefits, should be made available to them has been the subject of ongoing discussions and needs to be considered. A great deal of bureaucracy needs to be removed from the system. I know the Minister has spoken about this previously, but it is something that should be the subject of renewed interest.

The promotion of on-farm diversification measures is essential if we are to manage the ongoing changes in Irish farming and the countryside. I would like to highlight in particular to two areas of critical importance, both of which were mentioned by the Minister. I refer to organic farming and biofuels. I am pleased that organic farming, which has been something of a niche market before now, is being supported because there is considerable scope for development and promotion in that area. I would like emphasis to be placed on it. We need to develop the opportunities that have been generated in the biofuels sector as a result of developments in the sugar industry, which we would have preferred not to have happened. We need to invest in research and development if we are to promote the biofuels sector.

I would like to refer briefly to genetically modified foods. Ireland has an opportunity to protect its brands by selling and marketing GM-free produce abroad. It is clear that we cannot say every product is GM-free, but there is scope for placing some emphasis on this aspect of crop production. Our aspiration should be to have Ireland declared, within the relevant EU and UK legislation and in the relevant national and international fora, as an island that is free from genetically modified production. We should be proactive in protecting our environment against the unauthorised release of genetically modified organisms. This problem will continue to increase unless we deal with it proactively.

I am pleased that considerable reference has been made to research. The integration of research programmes is important. A great deal of research is taking place in the food and agrifood industries. We need to join the dots, to some extent, between the various levels of funding made available to our universities and Teagasc. I acknowledge that we have become more significantly involved in the development of research interests. I welcome the Department of Agriculture and Food's investment in the food research area. I always believe there is scope for more investment in research because it represents the future. We need to continue to come up with new ideas and different solutions to ongoing problems.

Some consideration must be given to local production and distribution systems. Horticulture was somewhat neglected until relatively recently. There is a great deal of scope for developing the support given to horticulture domestically. The issue of local distribution systems is related to the need to sustain employment in rural areas. We have recently become conscious of things like food miles — we are now more inclined to consider how far a product has travelled by the time it reaches our tables. While "food miles" has become something of a catchphrase, it is quite important. We need to consider how we can promote local production and distribution systems.

I wish to refer to dairy farmers. The EU Agriculture and Rural Development Commissioner recently said, in light of the WTO-related cuts, that the EU will probably lose most of its share of the world dairy export market. She addressed that statement, which continues to be valid, when she spoke in the Dáil Chamber earlier this month. It is clear that Ireland is at risk of bearing the brunt of some of the downward trend in global markets. It is important that we have significant integrated research production and marketing techniques to take account of that. We should concentrate on value-added and specialist products, etc. That will involve a focus on research, which is one of my favourite themes.

There is a need to consider the use of alternative crops in the aftermath of the demise of the Irish sugar industry. The recent increases in the price of oil and the fear of diminishing oil supplies should be seen as presenting an opportunity for Irish farmers. The potential for growth in the biofuels and organic farming sectors will be realised only if intensive research is carried out on the crops which might be most profitably grown in various areas and various kinds of soil. The results of that research should be made readily available to Irish farmers.

The importance of promoting an all-island policy perspective is an issue we have discussed previously. The initiatives which are required in that regard would be welcomed and should be put in place. I mentioned that one of the problems with animal diseases is that they have no regard for geographical borders, etc. The promotion of an all-island policy perspective in many aspects of the agriculture industry would be very welcome.

The Food Safety Authority of Ireland should have overall responsibility for food safety, from farm inspection to consumption. I do not want to dwell on the problems with food labelling because they have been raised on many occasions. It is important that our labelling should be clear and unambiguous. I discovered today that honey that is described as "Irish honey" is not Irish because it comes from all over the world. The safety authority has identified five producers labelling honey that comes from as far away as China as being Irish. This is an indication of the need to make progress with the clarification of food labelling. It is good, in a way, that testing methods are in place to allow us to identify cases of this nature and clarify such matters for consumers. The labelling of some products is so misleading that it will damage the reputation of Irish food if it becomes generally known that products from other countries are being labelled and marketed as Irish.

I will conclude by referring to animal health and welfare. I welcome the positive trends in respect of BSE, brucellosis, etc. I have spoken on many occasions about the issue of avian flu, which will not go away. After it has been dealt with, some other animal disease may well come to haunt our shores. We might have relatively little resistance to such a disease if we do not prepare for it. I welcome the commitment to animal welfare, but I do not know which Department has overall responsibility for it. I raise this issue in the context of puppy farming, about which I have asked on a number of occasions. Does the Department of Agriculture and Food have responsibility for it if it is a commercial process? Is the Department of the Environment, Heritage and Local Government responsible for it? As far as I can see, it is falling among Departments because they are passing it back and forth. While this might seem like a relatively small issue in the context of the agriculture sector as a whole, it is highly emotive. It is an important part of this country's commitment to animal welfare. I would like to ask a couple of specific questions about the Estimates later.

Chairman

I think the Minister for the Environment, Heritage and Local Government said today that he intends to introduce legislation relating to puppy farms. I hope it will cover the Deputy's concerns.

Dr. Upton

The legislation relates to dog breeding, which is a different matter.

Chairman

Puppy farming was mentioned today.

Dr. Upton

Was puppy farming specifically mentioned?

Chairman

Yes. If the Deputy wants the Minister, Deputy Noel Dempsey, to come to the committee, we will ask him to come to a meeting to discuss that issue.

Dr. Upton

We might do that.

Chairman

That is a matter for another day.

Mr. Naughten

I apologise for being late. I was involved with a deputation. I thank the committee, the Minister and Deputy Upton for facilitating me.

As we know, agriculture is at a crossroads. Six farmers leave the land every day. The current state of the agriculture industry is typified by RTE's decision this week to abandon Irish farm families, who pay €15.5 million in television licence fees each year, by discontinuing the farming news programme that traditionally has been broadcast on Radio 1.

The average farmer incurred a loss of €3,900 last year, even when the single farm payment is included as part of their income. The average annual income for farmers is €15,557 when the single farm payment is taken into account. When input costs of €15,478 and Government stealth charges are factored in, however, it transpires that farmers lose €3,900 per annum. It is shocking that the average family farm is losing €75 per week. In stark contrast to farm incomes, the average industrial wage has increased to approximately €30,000. The Department and public representatives must refocus their efforts to determine a future direction for the development of the agrifood sector.

In 2003, the Department recorded a saving of €19.6 million on its projected Estimate. The following year, €146 million of the Estimate remained unspent while the equivalent figure for last year was €83 million. The Minister repeatedly referred to the outturn in 2005, but it is at variance with the Estimate for the year. The research and development budget and the beef assurance, installation aid and farm waste management grant schemes were all significantly underfunded, despite being critical for the future development of the industry. It is disappointing that efforts are not being made to utilise funding to ensure that targets are achieved.

While I do not propose to discuss specific details of the Vote, I will highlight a number of items. Based on last year's Estimate, the increase in the allocation for the farm waste management grant scheme is €4.2 million. We are working off 2004 costings, despite the fact that the cost of building materials rocketed in the intervening period. The cost of steel, for example, increased by 30% in the past two years.

I welcome the Minister's announcement that the funding for this scheme will be backdated to 1 January. While this is a positive step, the allocation should have been increased by €11.6 million to match the amount provided in 2005 and cover the cost of the increase in steel prices. Based on the number of applications in hand in the Department, the average farmer will receive €14,500 under the farm waste management grant scheme, an inadequate sum to deal with the implications of the nitrates directive. These figures indicate that tens of thousands of farmers will lose out and will be obliged to use their own resources to implement the directive.

The Minister is seeking an increase in the allocation for wages, salaries and allowances, bringing the total increase in this subhead over the past two years to €17.8 million. In light of plans to reduce by one fifth the number of staff in the district veterinary offices and redeploy staff in other sections of the Department, I fail to understand the reason for this proposed increase.

I ask the Minister to consider ring-fencing some of the staff in question for deployment to provide customer services. Farmers trying to telephone the Portlaoise office are frustrated by their inability to reach officials. I accept that the number of formal complaints made to the Department is low but I ask the Minister to improve services to allow those with a query who try to contact the Department to reach officials rather than answering machines.

The Minister of State, Deputy Mary Wallace, indicated yesterday that a review of the early retirement scheme was necessary to determine whether the scheme should be a priority given the limited amount of money likely to be available for the rural development budget. The early retirement scheme should be a priority because we need to incentivise the release of land to young people. The current scheme may not be working well and its tax anomalies should by all means be addressed but a structured scheme for releasing land is still required.

Chairman

We will proceed through the Estimates in sequential order. Do Deputies have queries on subhead A — wages, salaries and allowances?

Mr. Naughten

Yes, I ask the Minister to respond to the questions I asked on the subhead.

Mary Coughlan

The Deputy is correct that the change in the single farm payment will result in a reduction in staff of approximately 400. Deputies will appreciate the sensitivities attached to this matter. The Department is working closely with staff in this regard and has reached an agreement with the Department of Finance that first option will be given to our staff in the local regions. This approach is working well and my objective is to ensure the greatest possible degree of satisfaction among departmental staff.

Wage agreements account for much of the increase in the allocation for salaries, wages and so forth. A major decentralisation programme is also under way in the Department with up to 600 staff set to move to Portlaoise. An office in Cork city will also move to Fermoy, while laboratories are set to move to Macroom. I hope 150 full-time posts will move to Portlaoise this year as part of the decentralisation programme. Temporary accommodation has been secured and we will liaise with staff and work closely with the Office of Public Works on the implementation plans for Fermoy and Macroom.

In addition, the project to relocate the State laboratory to new premises at Backweston continues. It would be a good idea for the Chairman and members to visit this impressive facility when it is up and running. Some of the academics among us will be highly impressed.

Chairman

Do they include Deputy Crawford?

Mary Coughlan

He is the practical expression of academia. As a result of this massive investment, 250 administrative, technical and professional staff will relocate. There has been a great deal of movement and change in recent times.

The Deputy indicated that the allocation for salaries, wages and allowances has increased by 11%. The change in outturn from last year is only 4%.

Mr. Naughten

I did not mention a percentage figure but noted an increase in the allocation of €17.8 million between 2004 and 2006. On the same issue, the Minister has scope to be flexible with staff. Will she consider extending her Department's opening hours to Saturday mornings and lunchtimes? Many farmers work on a part-time basis and the Department has the flexibility to take this factor into account. Will the Minister ensure that those telephoning the Department will reach officials who will respond to his or her query within 24 or 48 hours or whatever the case may be?

We are all dealing with the problem. Farmers are finding it hugely frustrating that they cannot get in touch with the Department with queries about the single farm payment.

Mary Coughlan

I addressed that issue two weeks ago when additional staff members were made available to do that work. This is not an excuse but if all staff is deployed to answer telephone queries then the work does not get done. We have been able to deliver that service relatively well.

With regard to a change in the work regime of the district veterinary offices, that will be a matter for discussion with the unions and may take some time to bring to finality. That is not to say we cannot deal with these issues. When it comes to issues such as the single farm payment last year, and especially with the threat of any class A disease, the members of staff of the Department have been more than flexible and helpful and have made themselves available to do these additional types of work late in the evening and at weekends. I hope we have addressed the difficulties but, equally, there are many good and hard-working people in the Department.

Mr. Naughten

I acknowledge that. The staff members have worked hard on this matter.

Mary Coughlan

It takes time but I accept there are issues. As a representative of a rural area, Deputy Naughten will appreciate that it is not easy to say to people who have been accustomed to going to the district veterinary office to work that there is no longer work any work and they may have to transfer to another Department. We are facilitating people to the best of our ability but it is disconcerting for staff members and the change must be carefully managed. That is not to say we will not be on target by the end of this year in terms of overall staff numbers.

Mr. Crawford

I agree with the Minister and Deputy Naughten on what was said about the work done by the Department officials. I have come across farmers who were very pleased that they received phone calls out of hours to try to sort out their problems and I acknowledge that.

I wish to raise the issue of the anxiety among staff members in the Cavan office, about which the Minister of State, Deputy Brendan Smith, is also aware. Some sections have been changed to other offices, or are in the process of being changed. I would like some clarification on what is happening in that regard.

Mary Coughlan

To allay the Deputy's fears, I salute the competence the Minister of State, Deputy Brendan Smith, on addressing the fears of the people of Cavan and Monaghan. Deputy Crawford is correct that some issues arose in that office. We are moving work around to reduce the burden on some of the people working in the Portlaoise office and work has been moved to Cavan. That will continue to be the case.

In addition, I have said to colleagues who complain they do not have adequate staffing available to them to do certain types of work that I have competent people in the Department who are more than prepared to do outside work. If it is possible to do that, we will.

The Department of Agriculture and Food is probably one of the most decentralised institutions in the first place and, as a consequence, people are quite adept at doing things outside their usual framework. Work has been moved from parts of the Department to Cavan and other centres.

Mr. Crawford

A significant amount of work has been moved out of Cavan.

Mary Coughlan

A great deal of work has been forwarded to Cavan. People will be moved out of local offices in due course. We will manage that in such a way as to take into consideration people's concerns. In addition, as the Deputy is aware, one of the reasons I am anxious for decentralisation to occur is to facilitate people in offices that are already decentralised. If the decentralisation programme can be rolled out it will fit in very well with my programme of work.

Chairman

Before we move from subhead A, I wish to say the joint committee would be delighted to visit the State laboratories.

Mary Coughlan

That would be a good idea.

Chairman

The clerk of the committee will arrange that in due course. We now move on to subhead B — research and training. Are there any questions on this subhead?

Mr. Naughten

There has been underspending in this area in recent years. For example, last year the Estimate was €28.805 million but only €22 million was spent. It appears that consistently in recent years we have not met our targets. For example, in 2004 and 2005 there was €8.2 million underspending in the area of research and development. What is being done to improve on this? We should try to push the barriers out in this area rather than coming in under budget every year.

Mary Coughlan

One of the difficulties in the Department is that we are very much demand led. Therefore, issues outside of everybody's control arise that lead to consequential savings. That said, one of the unique things about research in the food sector is that although funding is available to the Department sometimes the drawdown does not come until the second or third year but I still have to provide for a full drawdown within each year. It was on the basis of the methodology in which the drawdowns have been taking place that we have increased the funding this year for the research programmes. We have doubled the Stimulus grants and the amounts for FIRM this year. That will allow the drawdowns to take place.

In addition, it links in strategically with what we all agree is the absolute necessity for driving the research and training side of the Department and the groups that are involved. That is one of the issues under the auspices of the new vision document in which we see an opportunity in the development of the sector, which is something to which Deputy Upton referred, in terms of the alternative way we will do our business.

I hope there will be an additional drawdown in the research and training area. To date, a total of 139 proposals have been externally evaluated under the FIRM and Stimulus programmes. There is significant interest in them. A great deal of liaison takes place between Teagasc, the universities, the institutes of technology and industry. People are speaking to each other about the areas in which we need research and using it not just as an academic exercise but for the public good. There is no point in doing research to put it on a shelf, as opposed to ensuring there is a practical application for it. There has been significant interest from the institutions and the industry which is most promising.

Dr. Upton

I welcome the commitment to research which is very important. I accept what the Minister said about the drawdown but what is happening is not peculiar to funding for this Department. A great deal of bureaucracy often surrounds the drawdown of funding and perhaps the Department can make an input in this regard. This is a complaint of which I am aware from my previous life in terms of the form filling that is required. There is also an element of uncertainty in regard to repeat availability of grant funding. It is welcome that funding is being made available for research but the problem is not peculiar to this Department. It is widely recognised that a great deal of bureaucracy and form filling surrounds the grant system which adds to the trauma and makes it more difficult to access funding. I welcome the support for the research.

Mary Coughlan

Simplification might help.

Dr. Upton

Yes.

Mary Coughlan

One could be shot for saying it in the House, but there is such suspicion in respect of the procurement process that the Comptroller and Auditor General and the Committee of Public Accounts are on people's backs. The process is so regimented and regulated that it is difficult to spend money. However, there must be checks and balances to ensure somebody will not run away with it and there will be supervision of the outcome. I heard from a number of institutions which engaged in some fairly good research processes that the money either dried up on them or that it took too long to be delivered. There is something to be said for availing of any opportunity for simplification that arises.

Mr. Crawford

Some time ago, this committee visited Moorepark in Cork to consider this issue. There is a serious need to circulate products, dairy products in particular. One will remember that Baileys Irish Cream was highlighted to us as a success story but it is many years since it became available. I welcome the money being provided, but we must utilise it in every possible way if we are to compete in the real world.

Mary Coughlan

We have done much work at Moorepark. The incubation work has been very successful in allowing start-ups to take place. Under the auspices of the Minister of State, Deputy Brendan Smith, we will be considering bringing together a number of players. Instead of people making a decision in one direction, our decision, based on a common research and marketing perspective, will lead us all in the one direction, irrespective of whether it involves State bodies, the industry — including big and small players — and the farming enterprises and institutes.

I agree that much work has been done in the milk industry with regard to infractions and derivatives of proteins. Included in this work is the study of probiotics. Technology led to the creation and success of Baileys in that the basic difficulty of mixing a cream and a whiskey that would not normally coagulate was overcome.

There are no two ways about the fact that there are health promotion opportunities associated with milk. Much work has been done on this area and many Irish companies, both here and abroad, particularly in the United States, have been to the forefront of the research. However, Deputy Crawford is correct that we need another Baileys-type story for the dairy sector such that the newer technologies can be utilised and so pharma possibilities can be considered.

Minister of State at the Department of Agriculture and Food (Mr. B. Smith)

Deputy Crawford will agree that the good cream produced by Glanbia and Lakeland Dairies in Virginia was a very important ingredient in the success of Baileys.

Chairman

I thank the Minister of State for that.

Mr. Crawford

I know more about producing than the Minister of State.

Mr. B. Smith

That does not prevent us from commenting on matters.

Chairman

We will proceed to subhead C, which deals with food safety and public health, animal health and welfare and plant health. I will take all the questions on this issue together rather than asking the Minister to respond after every question.

Mr. Naughten

Is the Minister of State not very lucky to have someone of the ability of Deputy Crawford to assist him in his constituency?

Mr. B. Smith

When I was milking cows, I had a much smaller herd than Deputy Crawford, unfortunately. My family has never been able to scale up.

Chairman

We will have none of that.

Mr. Naughten

I wish to move away from the dairy industry. Under subhead C6, there is just short of €2 million less available in this year's Estimate for the national beef assurance scheme than there was in the 2005 Estimate. Some €14.2 million was made available last year and the sum is €12.6 million this year. Will the Minister explain why that is the case?

Deputy Upton made a very important point on the mislabelling of honey. The report on this is the latest in a series of reports by the Food Safety Authority of Ireland, some of which concerned the mislabelling of beef and salmon. Given that the matter falls within the remit of the authority, it is not necessarily under the Minister's remit. Mislabelling is undermining confidence in food safety within the sector. Will the Minister elaborate on this and outline the current position regarding countries of origin within the catering trade? When can we hope to see country-of-origin labels in that sector?

Dr. Upton

There seems to be a significant increase in the amount available for rapid testing in respect of BSE. The Estimate increased from €57 million to €108 million. Why is there such a significant increase, given that the number of BSE cases is decreasing? The fall is good news but the testing cost seems to have increased.

The Estimate in respect of scrapie is also increasing.

Mary Coughlan

The Deputy should ask the Minister of State, Deputy John Browne, that question.

Chairman

Perhaps he brought the information with him.

Dr. Upton

Have I touched unwittingly upon some sensitive subject?

Mr. Naughten

I have one relatively happy constituent regarding the matter.

Dr. Upton

Is there a story about which I do not know?

Mary Coughlan

I will inform the Deputy later.

Mr. Ó Fearghaíl

I acknowledge the great progress in tackling BSE and brucellosis. It is wonderful and farmers throughout the country will be delighted about it. Is there continued improvement in the fight against TB?

Notwithstanding what the Chairman stated at the outset, let us consider the point made by Deputy Upton regarding the dog breeding industry, which has been particularly topical in recent days. The report deals with animal identification and welfare and there seems to be an anomaly in that the greyhound industry falls under the remit of the Department of Agriculture and Food, while the rest of the dog breeding industry comes under that of the Department of the Environment, Heritage and Local Government.

We must admit that, while there have been some frightening instances of cruelty throughout the country, the vast majority of people involved in dog breeding are animal lovers who take breeding very seriously and who maintain very high standards. We must accept that dog breeding, be it commercial or simply for the love of it, is much easier to carry out in a rural setting than it is in an urban one. It lends itself readily to an alternative farm enterprise. We need to consider seriously issues such as this. Will the Minister state the role, if any, the Department has in securing the welfare of greyhounds? This is obviously within the remit of her Department at present.

On the issues of traceability and identification, the CMMS system is working superbly. One of the ideas concerning the management of the dog population and the development of this sector is that there should be ready identification. The Department has a system that works very effectively. Why, therefore, should the State consider farming out responsibility for canine identification to some other agency when it is already doing a superb job identifying animals?

Mr. Crawford

I welcome the fact that the Minister has changed the BSE regulations. I was seeking that change for years and it will save a great deal of money and hardship.

In that context, does the Minister intend to support those with cattle suffering from Johne's disease? Many of those who were obliged to sell their herds as a result of BSE discovered, when they restocked, that their new cattle had Johne's disease.

Disease costs have dropped because of progress in respect of BSE and brucellosis. Will the Minister consider doing away with the disease and dairy inspection levies? We are competing with farmers north of the Border who are not paying such levies. It is a small amount overall for the Department but it would be a gesture of goodwill for farmers who, in the case of Lakeland Dairies, have seen an increase of 6 cent per gallon.

Will the Minister re-examine compensation for TB? She is aware of individual cases, particularly in pure-bred herds, where the losses are colossal. It does not seem fair that if a herd goes down with BSE, full compensation is provided. If, however, it is affected by TB, that is not the case.

Chairman

I welcome the decline in the number of BSE cases and the changes the Minister has made. I have spoken to the Minister about testing of animals over 30 months. Will the Department now increase that figure to 36 or 40 months because of the decline?

I agree with Deputy Crawford, I am aware of too many sad cases involving people who restocked after their herds were lost to BSE and who discovered that their new cattle were infected with Johne's disease, for which there is no buy-out scheme. Will the Department consider the position in which these people find themselves?

Mary Coughlan

There has been a reduction in some diseases and, on the basis of the co-operation between farmers and the Department, we have been able to ease some of the legislative requirements, such as the BSE whole herd depopulation mechanism. Similarly, we should regularly evaluate outcomes in respect of disease eradication. When we can progress and change, we are prepared to do so. On the basis of the Chairman's point, I wholeheartedly support a change in the 30-month rule. We have approached Europe on that basis. Unfortunately, some of the legislative requirements reflect European requirements. Therefore, we need Europe to change. We are active and will seek to achieve that. It would be appropriate to pursue that avenue.

I do not like to compare myself to the British because they often have a different attitude to farming and the support of agriculture. The respect we have for agriculture is not always reflected in their policy framework but issues such as levies can be considered.

TB compensation has been raised on a number of occasions. It would be great if we did not have to compensate anyone because we would not have the disease problem. When a disease issue arises, it is horrendously difficult for all families. We appreciate that. The stakeholders have negotiated with the Department in respect of how this work will be carried out. That is not to say that people cannot change it. However, we use the 50% of the disease levies for the compensation payments and that has been reduced by €10 million. To keep costs low, it was agreed there would be a ceiling and that this should include livestock for milk and meet and pedigree stock. There is an issue where those in pedigree business would say they have a greater worth. It is an argument that can be made but there has not been agreement to allow that happen among the stakeholders. That is not to say that things cannot change.

Last year we discussed Johne's disease, about which Deputies were anxious. It is a chronic disease globally and I was anxious that we look at the management issues appertaining to it. Early last year we approached a number of people to participate in a pilot programme to look at the management issues without any success. We provided financial wherewithal and support to a number of farmers to participate in this scheme to allow us to develop farming practice that would address the issues related to the disease. That is not to say that I have not redoubled my efforts to allow a situation where that happened again. It is important those involved in the commercial sector participate with the Department in looking at the frameworks we must introduce. That is the only way to proceed. It is important but we must deal with it progressively.

We do not cover greyhounds, they come within the remit of the Department of Arts, Sport and Tourism. We cover horse breeding and responsibility for the remainder of the programme lies with the other Department. Issues have arisen in respect of puppy farms because there is no legislation to stipulate that it is an animal welfare issue. The Minister for the Environment, Heritage and Local Government is examining the area. Much of this stemmed from the county councils but I provide substantial money every year for animal welfare, which is very important.

Chairman

We will suspend for the vote in the Dáil and will take four subheads at a time when we return.

Sitting suspended at 4.10 p.m. and resumed at 4.25 p.m.

Chairman

We will group the subheads.

Mr. Naughten

In regard to subhead E and the modulated funds, when will we know what will happen with the budget for 2007? I welcome the fact that it will cover the disadvantaged area payments in 2006.

In regard to subhead G, early retirement and farm retirement, the Estimate for the installation aid scheme for 2005 was €10 million but for 2006 that has been cut to €7,201,00. Why did the Minister make this cut?

What type of increase has the Minister sought from the Department of Finance under subhead H, the farm waste management scheme? While it will be backdated to 1 January, which is a positive development, it is critically important that it comes in line with the current actual costs for farmers and that it is not a historic figure or one that is plucked out of the sky. There has been a 30% increase in the cost of steel over the past two years. Can the Minister assure us that those costs will be covered by the increased costings on the level of grant aid available?

There is an increase of €8,000 in the organic sector for 2006 but only 50% of the funding available in 2005 was drawn down. That is disappointing when this should be a growth area, particularly in light of the large volume of produce coming into the country because we cannot meet the demand here. What is being done to ensure that the target, which is probably inadequate, will be reached, particularly as it has not been reached in recent years?

Does the Minister have any plans to amend the forestry grant schemes to facilitate biomass, willow, short rotation coppice and so forth? What additional steps will be taken in the current year to try to maximise the draw down so that it will meet the estimated target? Of the €92.7 million estimated for the afforestation last year, only €79 million was drawn down.

Will the Minister return to the committee to explain her role in the sugar compensation scheme and the timetable for its implementation? It is not directly related to today's discussion but could the Minister come back to us to discuss that issue, about which many people are confused?

There is no allocation under subhead M, hardship, and there was none last year. As we all know, however, farmers are in difficulty because of the poor weather in recent weeks. In the Shannon callows and the Shannon and Suck basin, for example, much of the land was devastated by the recent bad weather. This year, much of what emerges from it will be worthless as a fodder crop to feed cattle in the summer months. Many farmers will find themselves in severe financial difficulties as a result. The compensation scheme has not yet been put in place, even though discussions have been ongoing for years. We do not know what kind of weather we will have over the next several months. Will the Minister include a token figure in that subhead in order that it can be used if funding is required later in the year? It appears that, based on the recent weather, quite a number of farmers will become severe hardship cases later in the year.

Dr. Upton

Although I welcome the input for the organic produce sector under subhead H, it is important that should be used to promote the organic produce sector and the funds should be fully drawn down. Will the Minister comment on the significant increase in funding for alternative enterprises and provide an indication as to the nature of these enterprises?

Why has the allocation under subhead L, which relates to food aid donations, reduced from the figure for the 2005 outturn?

Subhead M, general legal expenses, has gone from €3.1 million to €7.3 million. Why has there been such a large increase? It is ironic there has been an increase in the subhead for the production and marketing of honey. Labelling is important in this regard. We must ensure that Irish honey is correctly labelled and that we are not marketing Chinese honey as Irish. Under the miscellaneous heading in subhead M, there is a substantial increase from €16,000 to €150,000. Why has this occurred?

Mary Coughlan

That is an estimate. The other figure is the actual outturn. It is a contingency fund and not a case where I could run off having parties on this money.

Dr. Upton

It seems like a significant increase.

Mr. Blaney

In regard to subhead I and biofuels, I know the Minister recently addressed a conference in Donegal on biomass energy. With the small farmholdings in County Donegal and other similar counties, inroads could be made in biomass energy for those farmers. The Minister stated she will soon announce two new initiatives in biomass. There is not enough emphasis placed on the possibilities of oilseed rape production. A large killing could be made in this market. It is a market that needs to be taken by the horns. It could reap much potential for our farmers.

Mr. Ó Fearghaíl

Subhead G deals with the early retirement scheme and installation aid. While I know there is no correlation between the two figures, €72 million is allocated for the ongoing process of early retirement and €7 million for the installation scheme.

Deputy Naughten earlier expressed concerns regarding the future of agriculture. In a recent debate with the president of the IFA, it was pointed out that only 18% of farmers are under the age of 35 years. I must express concern that, because of the barrage of negativity as to the future of agriculture emanating from some sources, there is a real danger that many farm families, particularly those involving parents under 50 years of age who are rearing children, will actively discourage their offspring from pursuing a future in agriculture. It behoves us all, notwithstanding the challenges that will always be there, to put our best foot forward. We must declare there is a future in agriculture despite the challenges. Does the Minister see the need for any specific initiative to encourage people to look more positively at the industry, and in particular to encourage the parents of children growing up in the agricultural sector to consider a future in the business?

Mary Coughlan

I will leave the horticulture, forestry and biofuels matters to the two Ministers of State.

The fund for general legal services is there in the advent of payments having to be made for legal issues. There are two substantial cases before the courts and I am not in a position to comment on them. It may seem a considerable amount but it is contingency funding.

The outturn last year for the early retirement scheme was €5 million and the Estimate this year is €7.2 million. Last year, the Department received 795 applications in respect of the scheme. One problem is that there are parallel discussions taking place in the partnership talks that may have implications for several of these initiatives. When it comes to installation aid, I am fairly disposed to increasing that as an initiative to support young farmers. It has been linked with several tax initiatives introduced by the Minister for Finance. I appreciate that the committee, particularly Deputy Wilkinson, did much work on the early retirement scheme. A new rural development programme will be launched soon. Several of the issues raised by the committee will be considered in this context. In light of my ministerial experience in a previous Department, I am conscious that any changes that may be introduced by me cannot have a detrimental effect on the social welfare side. A ha'penny can make a large difference between the two schemes and, as a consequence, it may leave people less well off. That is not to say increases cannot be included in the next round, which brings us to Deputy Naughten's question on modulation. That was separated as a programme only last year, and it is now all part of the rural development programme. As members know, we have had many meetings discussing REPS and other rural development programme issues. Discussions have been taking place with stakeholders, and I hope to have the plan's framework decided around the end of September.

Mr. Naughten

Under the rural development plan.

Mary Coughlan

It is the rural development plan; the modulation funding is part of that.

Mr. Naughten

Perhaps the Minister will correct me if I am wrong. My understanding was that the Department had sought submissions regarding the modulation funding specifically.

Mary Coughlan

Yes, for 2006.

Mr. Naughten

Therefore, the Department decided to park those proposals and to put the money into disadvantaged areas.

Mary Coughlan

It is only for 2006. In 2007, it will be part of the overall package. We will have to decide by September what to put into it.

Mr. Naughten

Are the submissions made then now abandoned or obsolete?

Mary Coughlan

No. They are for this year.

Mr. Naughten

The decision has been already made for this year.

Mary Coughlan

The €18.5 million is this year's money. We discussed this last year, although it is to do with this year. We made the decision in 2005 on what we would do.

Mr. Naughten

In 2006.

Mary Coughlan

Yes. It was a public consultation. Then I decided that——

Mr. Naughten

It should be used for disadvantaged areas.

Mary Coughlan

Yes, to be paid in 2006. Much of that information is still pertinent to discussions taking place regarding the rural development programme, which covers REPS, forestry, early retirement and all the other schemes. By the end of the summer, I will have decided where we are going with this programme, which will start at the beginning of 2007.

There are one or two other matters. The hardship fund is closed, but it provides a method whereby, if something happened, I would be able to transfer money without having to go through the rigmarole of the Dáil and Seanad. I stress that I do not lack due regard for democracy, but it would allow a quick response to any situation. Reading the Irish Farmers’ Journal last week, I could feel a scheme coming on, since the photograph really hit home. It is the method whereby we in the Department allow money to be used.

Mr. Naughten

Should there be a notional figure for that to keep open the account?

Mary Coughlan

It is still open with zero. It allows me to do that.

The Minister of State, Deputy Brendan Smith, might deal with organic farming. The other scheme discussed was the farm waste management scheme. We will backdate it, but I do not wish to be seen to pre-empt partnership discussions currently ongoing and I am unable to tell members what is on offer, since no offer has been made. We would hope to be able to conclude the talks soon, at which stage offers can be made. It is a difficult situation, and we thought we would have finished the talks by the time we arrived before the committee and therefore have the answers.

I know Deputies raised one or two other issues in their initial questioning, such as farm diversification.

Chairman

Deputy Crawford wants to speak. We have agreed this for all subheads. Perhaps I might let him speak, if the Minister does not mind.

Mr. Crawford

There was an underspend on installation aid. There are people, perhaps only dozens, but perhaps more, who lost out on such aid because of some minor technicality. Some of them may have had a piece of land put in their name by their parents at a much earlier stage, with the result that they cannot now receive the aid. Is there any way to sort out such anomalies? It is difficult enough for young farmers, and the money is there.

Mary Coughlan

Often the problem is that there is plenty of money but the scheme fails to reflect some difficulties. That is why I always feel, although my Department might not agree, that there should be a section called "St. Jude" in every scheme. We usually end up with such cases. I would hope that, in the context of the new programme that we will introduce, some of those niggly issues that have annoyed people for some time on REPS, farm development, forestry and so on might be addressed. We must learn the lessons, and if there are pertinent issues, we can examine them.

Mr. Crawford

Inspecting farms North and South as a member of the British-Irish Parliamentary Body, one of the things that scared me most was that the situation of a farmer in my constituency — I will not say if it was Cavan or Monaghan — was portrayed to us as ideal. However, when I asked him, it transpired he did not have insulation, either because of technicalities or because he was not in receipt of REPS. Without such things a farmer cannot survive, yet he was presented to us by a senior departmental official as an ideal young farmer showing the way forward.

Chairman

Perhaps, if the Deputy brings those problems to the attention of the Minister, she will be able to resolve them.

Mary Coughlan

The alternative enterprises raised by Deputy Upton have not proven particularly successful, since we had received only 604 applications by the end of 2005. That is why spending on that is much less than anticipated in the last NDP. Such things as deer farming simply did not get off the ground. The real alternative enterprises will be biofuels and energy crops.

Mr. Crawford

The former Minister got many people off the ground, since he left them with none.

Mary Coughlan

They jumped the fence.

On sugar, we are aware of the timetable discussed in the House. We are currently involved in a consultation process and by the end of September we intend to have concluded talks between Greencore, the stakeholders, my officials and me. Given the appointment of Indecon, we hope to have decided the sugar regime's entire framework by the end of September 2006.

Perhaps I will allow my two colleagues to deal with such specific issues as horticulture and forestry.

Mr. B. Smith

Deputy Upton referred to the need for local outlets for farm produce. I presume she meant the growth in farmers' markets. In the past 18 months or so, the number of such markets has grown from 50 to approximately 100, and I am opening another on Saturday. It is a welcome development, and we have worked in conjunction with Bord Bia and the Office of Public Works to provide suitable sites.

A pilot programme is running this year, with several OPW sites being made available to hold farmers' markets throughout the country. We understand they are not the answer to everything, but they provide an important outlet. Through Bord Bia, the Leader programme and local partnership companies, some assistance is being given to promoters. It is an area we wish to see grow and will try to facilitate by all means.

The organic farming sector in Ireland is small by European standards, and it has been slow to grow. I believe it is currently worth approximately €40 million per annum. In 2005, the sector grew by 5,000 hectares, or 15%. An additional 90 farmers registered as organic producers. That modest growth comes on top of a small base, but we have substantial grant assistance. One incentive is participation in REPS. A person need not devote his or her entire holding to organic farming to draw down the REPS payment. One can divide one's holding.

In the next rural development round, the Department proposes operating support for organic farmers separately from REPS, since we are conscious there is a cost to having a REPS plan drawn up, and that is not a great incentive for a person with a small holding. There is also a valuable on-farm investment scheme through which substantial grant assistance is available.

As Deputy Upton said, in the past two years we have given the horticulture sector as a whole added impetus, particularly through additional grant assistance. That has been recognised by both farm organisations and people in the industry. It is often overlooked by society in general that annual farm gate production is currently valued at €300 million, and retail sales are of the order of €650 million. The horticulture sector provides employment for 10,000 people. If potatoes are added, the farm gate value increases to €380 million on an annual basis.

In the past four years, more than €30 million has been paid in grant aid for capital investment by horticultural producers to support investments that have amounted to €38 million. Approvals have been issued this year for proposals from 150 producers, amounting to an investment of €18 million. Having met representatives of the sector, I am aware that there is much enthusiasm out there. Many operators are providing new on-farm facilities, introducing efficiencies and producing top quality products that are displacing some of the imports entering the country. We believe that there is great potential for growth in the sector. Operators and farmers are investing a great deal of money, demonstrating that they have confidence in the sustainability of the sector. We will continue to put substantial investment into the area because we see the value of it in creating employment and healthy products.

The producer organisation scheme is also of particular importance to the horticulture sector. It has been of great assistance in helping individual farmers, co-operatives and producer organisations. From 2004 to the end of 2006, we will have sourced €15 million from the EU in assistance for that scheme. We have encouraged other farmers to join producer organisations. The mushroom sector has been more effective in organising itself into producer groups than other sector of the horticulture industry. There is valuable grant assistance to assist the different producer groups in marketing and technical know-how. Substantial funding has also been given to this sector through the Department's marketing and processing grant aid scheme. During the lifetime of the current national development plan, €45 million has been out in grant assistance in to different agricultural sectors, including horticulture.

Minister of State at the Department of Agriculture and Food (Ms M. Wallace)

We would consider that 10,000 hectares represents the critical mass for forestry planting, which was reached in 2005. It is unclear if the improvements from 2003 will continue because the planting rates for 2006 are lower than expected. There is an attractive incentive package because farmers can plant half of their land without affecting their single farm payment. There are 20-year premiums, a plantation grant, a Teagasc income, a growing market for thinnings and so on. We would like to see more farmers planting in 2006. Due to the decline in State planting, we are heavily dependent on the attraction for farmers, who are currently planting 90% of new forestry.

There is a new focus on wood energy, even though attention is being paid to all aspects of renewable energy. The Minister referred to the new incentives being developed for harvesting, for chippers and for the planting of willow. This week is wood energy week and we have been visiting wood burners in Letterkenny, Oak Park in Carlow, Kelly's Hotel in Wexford, as well as Johnstown Castle. A grant will soon be announced by the Department of Communications, Marine and Natural Resources for commercial-scale biomass boilers. This follows on from the €27 million greener homes grant for domestic burners and boilers. The idea behind these grants is to create demand for wood biomass.

To answer Deputy Upton's point, the closing date for research in this area was 24 February. In all, 70 submissions were received and we hope to enter decisions shortly. These submissions represent innovative approaches to alternative timber use, with particular emphasis on reducing dependence on fossil fuels. We are working in all the different areas of the promotion of wood energy and we hope the work will encourage more farmers to plant forestry in 2006.

Mr. Crawford

The Minister of State, Deputy Brendan Smith, has shown strong support for the mushroom industry. Does he accept that the industry is in crisis? The number of farmers has decreased dramatically recently and there is a marketing problem in the UK in respect of Irish mushrooms.

Dr. Upton

Agriculture is in a transitional stage for a number of reasons, including the single farm payment. In fairness, it should be acknowledged that it has worked well relative to other countries. The emphasis in the future will be on quality and on the environment. We must look at the drivers that will promote animal welfare, care for the environment and quality of our products. As we will never be able to compete with quantity, our agriculture and food industries will have to be quality driven. The consumer will also play a more significant role in determining how agriculture is managed in the future.

Mr. B. Smith

Deputy Upton referred to the need to continue to build on the all-Ireland concept. We have all-Ireland garden and horticulture competitions. There is much collaboration in that area.

Deputy Ó Fearghaíl referred to the negativity surrounding farming as a career for young people. I attended a Council meeting on agriculture yesterday during which a detailed discussion on education, research, innovation, etc., took place. Every Minister mentioned the negativity surrounding a farming career in his or her own country. People do not take up farming as a career by chance. They must be prepared through education and training to enter farming. Traditionally, farming expertise and knowledge was handed down. With farm sizes increasing and society changing, however, we should not expect the knowledge and expertise to be handed down adequately. Much investment has been made in the area of education via the agricultural colleges. A young person can enter agricultural college in a place such as Ballyhaise and obtain a certificate, a diploma and, later, if he or she wishes, a degree. It is fabulous that there is such a system. I have been working with Teagasc to develop a degree course for Ballyhaise in conjunction with Dundalk Institute of Technology. We hope to make progress on that. If we are to make farming and agriculture attractive career options, we must ensure that the training and advisory service is available.

One matter we put forward at the Ministers' meeting was that we do not want Brussels to hand down curricula or programmes for courses. There should be a general European framework with national accreditation, in which qualifications have transnational recognition. We must take that route. If we are to encourage young people to grow alternative crops, they will need to know that assistance and advice is available to them.

On a European level, we should try to pool our knowledge and expertise in order that it is available between member states. Negativity, which is evident throughout the 25 member states, is a problem. We must deal with it at home, and education and training is extremely important in this regard.

With regard to Deputy Crawford's point, the reality is that the number of farmers in mushroom growing has declined significantly. However, despite this, the same output has been maintained. A mushroom task force was established by the Minister of State, Deputy Treacy, some years ago, which came up with a number of key recommendations. We have been successfully implementing those recommendations and most have been implemented at this stage. The area of mushroom farming and production is given priority in the allocation of grants under the horticulture grants scheme.

Many farms, as the Deputy will know, have up-scaled and improved on-farm facilities. I regularly meet farmers and farmers' groups as well as their representative organisations. These farmers have confidence in the mushroom sector. They are talking to us about further development and phase 3 composting. They want the new technology to be put in place to ensure that the industry survives. I am confident that not alone will it survive but that it will grow. Extremely good operators and farmers work in the industry today. They are investing considerable sums, assisted by departmental funding, and they intend to succeed. I am confident they will do so.

Mary Coughlan

I thank the Chairman for affording us the opportunity to discuss the Estimate. I also thank the members of the Opposition and my party, who are always very forthcoming.

With regard to agriculture, it is our intention as a Government and a team to support a very progressive industry in which we foresee challenges but most particularly opportunities. This is why the three key themes included in our vision document — innovation, research and development and market and consumer orientation — suggest the direction the industry will take. It will continue to do what it has done well and will achieve a reputation internationally as a food island.

The question is how we can ensure this happens despite the difficulties and challenges. We have certainly been more than forthcoming in the support of the Estimate. In particular, the farm waste management scheme has seen massive investment. I take the opportunity to urge farmers to make their applications by the end of the year because there will be no flexibility at the end of the year. I put an advertisement in the newspapers two weeks ago with regard to discontinuing REPS. If committee members meet constituents, they should remind them to move into the new REPS because I do not want farmers to lose out.

Having the Commissioner to the Houses gave us a great opportunity to hear her views. She very much reflected the work we are doing at present, in particular by having a good cut at Deputy Hayes — as I had given him a whammy the previous week, he will not come to an agriculture debate for a while.

It was interesting to note that many of the issues with which we are dealing, and being forthright about from a policy perspective, are similar to the European perspective. We have challenges in the dairy sector with which we must meet and deal if we want to afford new opportunities to farmers. Moreover, how we will compete will be based on quality, not mass production. Quality is where we have a significant opportunity as a nation. Innovative ways are being developed in the new rural development programme, for example, and many of the initiatives look to the future of agriculture as continuing to be the bedrock of many of our indigenous enterprises.

At the end of the day, no matter what rural policies are introduced, one real rural policy is the development of agriculture. Whatever way that develops, we will certainly have regional rural success. We have made a considerable investment — more than €3.3 billion overall — in agriculture this year. That is a sizeable amount to make available at this stage to support an industry which, we would all agree, is not given the regard it deserves in the public arena.

I thank the Chairman for facilitating our discussion and thank my officials, who have always been forthcoming in providing support on the hard questions.

Chairman

That concludes the select committee's consideration of the Revised Estimates for Vote 31, Department of Agriculture and Food, for the year ending 31 December 2006. On behalf of the committee, I thank the Minister, Deputy Coughlan, the Minister of State, Deputy Brendan Smith, the Minister of State, Deputy Mary Wallace, and their officials for attending the meeting.