SELECT COMMITTEE ON AGRICULTURE, FOOD AND THE MARINE debate -
Wednesday, 28 Nov 2001

Vol. 4 No. 8

Estimates for Public Services, 2001.

Vote 30 - Department of the Marine and Natural Resources (Supplementary).

The Select Committee went into private session at 4.30 p.m. and resumed in public session at4.35 p.m.

Chairman

I am a bit unlucky as Chairman. Every time I have an agreement from the Minister for Agriculture, Food and the Marine, Deputy Walsh, to attend something crops up. He was scheduled to attend this meeting, but he is in discussions about the beet issue. This morning when I was arguing with him he reminded me that Deputies Dukes and Penrose wished him the best in those negotiations. I welcome the Minister for the Marine and Natural Resources, Deputy fahey, and his officials. This meeting has been scheduled to consider a token Supplementary Estimate of £1,000 under Vote 30 for the Department of the Marine and Natural Resources. This Supplementary Estimate represents the transfer of funds to subheadings covering grant aid.

I remind members that we are considering this Supplementary Estimate only. Members may not suggest increases or decreases and debate should be confined to the specific subheadings referred to in the brief on Supplementary Estimates, a copy of which was circulated with the agenda. We agreed last week that we would take two small Supplementary Estimates today, one for the Department of the Marine and Natural Resources and one for the Department of Agriculture, Food and Rural Development. We will allocate ten minutes to the Opposition spokesman and five minutes to other Deputies. The Minister will have time to reply.

Minister for the Marine and Natural Resources (Mr. Fahey)

My speech has been circulated. I will summarise it in order not to take up the time of the committee.

The Supplementary Estimate is requested for two reasons. Additional funding is needed for the Marine Institute and for the petroleum infrastructure support group. The additional funding sought is £4.16 million and as the additional expenditure in each case is to be made up from savings, the Supplementary Estimate sought is a token one of £1,000. The Marine Institute provision of £7.2 million is in respect of payments being made for the RV Celtic Explorer. This new research vessel is being built in Holland. Provision of £2.41 million, giving a total provision of £9.65 million in 2001, for the marine research vessel will enable the Marine Institute to enhance the profile of the contract by bringing one payment forward from March 2002. That will ensure the early targeted delivery in 2002 is met. The bringing forward of the payment will ensure the project costs are not subject to further inflationary pressure, possible funding constraints in 2002 will not impact on the project delivery and the new vessel will be available on schedule for survey work as part of the national seabed survey.

The biotoxin programme is being carried out by the Marine Institute. We have had a major difficulty, as members will be aware, with biotoxins. They arise from naturally occurring phenomena in our waters called toxic algae blooms. Toxicity during 2000-01 has been at unprecedented levels and has caused the closure of 32 bays for prolonged periods with damaging results for industry. The purpose built laboratory operates a monitoring programme designed to detect toxicity in shellfish growing areas before harvesting and, therefore, provides the necessary information to restrict the placing of toxic shellfish on the market. It consists of in-house testing. The cost of testing has increased as a result of difficulties from £2,500 to over £8,000 and over £1 million in current expenditure is required for this extra work. An additional £500,000 is required for the purchase of a liquid spectrometer.

The third subhead is the petroleum infrastructure programme. An additional £250,000 is required to allow a contribution from a petroleum exploration company to be charged and made to the Department to use to make grant disbursements from the Vote. This programme was established by the PAD in July 1997 in conjunction with the award of exploration licences under the Rockall Trough licensing round.

A provision of £125,000 was made under subhead L3 in this year's Estimate. This sum has already been paid under the programme in 2001 in appropriations-in-aid by way of contributions to the petroleum infrastructure support group. Since then an exploration company has made a contribution of £250,000 to the programme in lieu of non-fulfilment of a drilling obligation under licence 1195. To allow this contribution to be used to fund the scholarship scheme to allow selected postgraduate students to undertake studies relevant to the oil and gas exploration industry, an additional £250,000 is required under subhead L3 in 2003. It should be noted that this transaction is Exchequer neutral. It is proposed to meet the additional funding for the Marine Institute and the petroleum support group grant-in-aid subheads from savings in the Vote amounting to £4.159 million.

Expenditure under the subhead G1 relates to capital development work at five major harbour centres and selected secondary harbours. These were funded under fishery harbours sub-measures of the south east and BMW operational programmes of the NDP. It is proposed to use capital fundings of £2 million from subhead G1 in 2001. Savings in 2001 have arisen due to underspends in certain projects and delays in the planning of foreshore improvements. These were mainly due to delays in planning permission, foreshore approvals and tendering.

Expenditure under subhead 13 relates to the seafood processing measure under the productive operational programme 2000-06. As this scheme has not been launched, no expenditure has been incurred to date. I will set a date for the launch of the scheme as soon as the investment strategy is finalised.

I have outlined to Deputies the details of the Supplementary Estimates, the cost of which can be met by savings. I hope the committee agrees the proposals are reasonable and can be approved as presented.

Mr. Dukes

I thank the Minister for his introduction of the Supplementary Estimates and the very useful briefing material provided to us. Although this is a token Estimate for a net total of £1,000, the changes being proposed are significant in certain regards. I am not making a criticism, but note that this is an important reallocation of expenditure in light of several factors which the Minister pointed out and I welcome the opportunity to consider it.

The first issue relates to the biotoxin programme in which £1 million of current expenditure and £500,000 in capital expenditure is reallocated. As I understood it, the Minister stated there is a requirement to test all bays where there is production on a weekly basis for a range of toxins and that this testing is undertaken prior to harvesting to ensure the products are healthy. This is essential. We are all glad this level of supervision is taking place to ensure the products coming on the market are safe. However, the Minister, or the briefing paper, did not indicate what, if anything, is being done to try to determine the underlying cause of the problem.

The Minister stated that these toxic algae blooms are natural phenomena, but in the briefing material it is pointed out that toxicity during 2000-01 has been at unprecedented levels. Is there any explanation for this unprecedented level of toxicity? What kind of research is being carried out? Are there any indications from this research, if there is any, of measures which could be taken to return toxicity to more normal levels? I assume there is a threshold below which these products are reasonably safe and beyond which we need to be worried. What is the cause of this toxicity and, if it is not known, what kind of research is being carried out to determine it? Without seeking to be alarmist, is there an indication of whether the unprecedented levels are a one-off event or are they part of a longer term trend?

The provision in respect of the research vessel entails a reallocation of £2.4 million in capital expenditure. I understand that what is being proposed is, in the jargon, to rebalance the profile of the contract. I gather a payment is being made early to help bring forward its operation. This appears to be prudent management, of which the committee should approve. I know it is not always a popular thing to do, but I suppose at a time of a relative abundance of funding, it is useful to do something like this when the opportunity presents itself.

On subhead L3 the Minister indicated that an additional sum has been allocated as a grant-in-aid. This has been made possible by a contribution of £250,000 this year by an exploration company in lieu of non-fulfilment of a drilling obligation. Will the Minister indicate the circumstances of non-fulfilment? Is there likely to be drilling activity in the future under this licence or will it be written out of the programme?

Subhead G1, as I understand it, provides for projected savings of almost £5.3 million under the fishery harbours development programme. The briefing note states that this subhead relates to capital development works at the five major fishery harbour centres and selected secondary fishing harbours. In which of these harbours and harbour centres do these savings arise? In particular, I would like to know if any of the projected savings arise in Killybegs and, if so, will they have implications for the work carried out during the course of next year? I am sure the Minister is aware that there is a good deal of worry in Killybegs that the current programme will be either slowed down or restricted. A portion of the work in Killybegs is not connected with the main pier but is on the shoreline nearer the town. It has been the subject of many adverse comments locally. A slipway has been built in a way that local people feel is not very relevant to their needs. They feel its usefulness will be compromised by its location in respect of tidal movements. I am more concerned with the development of the main fishery harbour at Killybegs. Perhaps the Minister will tell us more about whether it is being slowed down or restricted.

The briefing indicated that savings in 2001 have arisen due to under-spending on certain projects and delays in planning and foreshore approvals. It would be useful to know which projects are concerned there.

With regard to the subhead on fish processing, the projected savings involve £2.37 million out of an original Estimate for 2001 of £2.7 million. It appears that, instead of £2.7 million having been spent in 2001 of fish processing projects, we will have spent £330,000. That is very unsatisfactory. I note that the detailed strategy has not yet been completed and I read in the briefing material the following: "A date for the launch of the scheme will be set as soon as the investment strategy is finalised and has been approved by the Minister.". I am around long enough to make a fair shot at decoding that. It means that the Minister, as yet, has no idea when he will announce this programme, so it could be some considerable time into next year before it is announced. What is the reason for the delay in this regard?

I am sure the Minister will not be surprised to hear me say that in recent discussions I had with people involved in processing, I found a number of them rather unhappy with the emphasis in the programme. They think it is not necessarily proceeding in the direction they would wish in order to promote the development of their industry. Will the Minister tell me if he has had any further discussions with the processing sector with a view to coming to a common understanding? I say that without any mischief in mind. I am anxious to see a strong sense of ownership of the policy on the part of the processing sector for a number of reasons, not least of which is that a very good job has been done in recent years in achieving a very wide measure of agreement in the industry on the approach to the review of the common fisheries policy. The Minister might be surprised to hear me being positive about his activities for once, but I think the work that was done on the Common Position on the review of the fisheries policy will turn out to be very worthwhile for us in the future and it will support the Minister in pretty difficult ongoing discussions.

If possible, I would like to see the same unity of purpose when we begin to discuss fish processing because there are enough problems to be dealt with in that regard without our having differences of opinion among ourselves.

Mr. Penrose

I welcome the Minister and his officials and I thank the Minister for introducing this Supplementary Estimate. I am standing in for my colleague, Deputy Bell, who is our usual spokesperson on this topic.

With regard to the biotoxin programmes, I read with interest comments made by the Minister, particularly the reference to the presence of harmful or toxic algae, the potential for algal blooms and the negative impact they can have upon the industry. Will the Minister indicate what level of research has been undertaken concerning the possibility of algal blooms and the growth of toxic algae in our inland lakes? Has he or his Department any role in this regard? There are concerns about the deterioration of inland lakes in which there is a notable increase in the occurrence of algal blooms. Concerns focus on their impact in respect of the utilisation of our lakes and the importance of lakes to indigenous and foreign tourists. Do the Minister, his Department or the Marine Institute Fisheries Research Centre carry out tests or monitoring to ascertain the source of algal blooms, the cause of harmful algae and their impact on the aquaculture industry and the wider fisheries industry?

Do the Department or the Marine Institute Fisheries Research Centre have any role in the measurement of the impact upon water quality of harmful discharges or otherwise in and around the Irish Sea, especially in the area adjacent to the Sellafield nuclear plant which has been the subject of considerable debate in recent times? If not, why not? Does the Minister envisage a role for the Marine Institute in that area as an adjunct to ongoing activity by the Government and others who are concerned about Sellafield and its potentially negative impact?

With regard to fish processing, I am surprised and disappointed to note that £2.37 million will be saved. What impediments are holding up the development of the seafood processing programme? Why has it not been possible to set a definitive date for the launch of the scheme at this point in time, only one month from the end of the year? Obviously, this figure was placed in the Estimates in anticipation of the scheme proceeding. It is particularly important given the number of sea ports that would be involved. Our capacity to reach our full potential in respect of processing might not be reached because of the lateness of the programme.

I am particularly interested in subhead L.3. As a Labour Party member, I would be. What are the returns to date from prospecting licences? The public is very eager to ascertain that. How may companies have failed to fulfil their obligations under their licensing conditions to date? What reasons are they giving or do they excuse themselves from taking up their licences by just paying what, to them as very powerful and deep-pocketed corporations, is a nominal sum of £250,000?

What are the numbers employed in the exploration of our gas and oil resources? What is the number of Irish people involved, if any, in light of the generous licences issued? What sort of scholarship scheme is envisaged? In what way are postgraduate students likely to undertake studies? How many scholarships are taken up under this useful and worthwhile initiative? How many students will be able to participate in that postgraduate research?

Chairman

Deputy Brady, I remind you that you have only five minutes to make your contribution.

Mr. J. Brady

I will not need five minutes and I will give any time remaining to Deputy Sheehan as he is an expert on marine and other matters. He will probably speak on behalf of the Minister as well.

I welcome the Minister and his officials. I am concerned about the harmful and toxic algal bloom in some lakes. Lough Bracken, near Drumconrath in County Meath, from which the public water supply was taken had a serious problem in this regard. I was amazed to hear North-Eastern Health Board and Meath County Council officials saying that while the water may harm fish, it is safe for human consumption. I cannot understand how it could be safe for humans if it is harmful to fish. The lake was a fine lake for pike and trout fishing.

We have been told by officials that the yellow scum which has formed on the surface results from excess phosphorus but nobody is aware of its source. Meath County Council had to find a alternative supply as the water became very dirty and discoloured and created an unbelievable stench. Has the Department any control over these lakes? Although the lake is no longer used to provide water for human consumption, many people are very concerned about its quality for fishing. I ask the Minister to send his officials to investigate the lake and try to determine if anything can be done to rectify the problem.

Mr. Sheehan

I congratulate the Minister for laying the Supplementary Estimate before us this evening and I thank him for adhering to my request last week for the allocation of 7,000 tonnes of mackerel to the polyvalent section of the fleet. I was delighted with his response; he has certainly made a step in the right direction. It was wrong and completely undemocratic that 99% of the mackerel quota was owned by 23 fishing boats.

I am very interested in the Marine Institute administration and development grant-in-aid and the biotoxin programme as I have seen the damage toxins have caused in aquaculture in west Cork. Mussel production was halted for two months last year on account of the red tide phenomenon. I would the like the Minister to pursue that as far as possible to find out what is causing the plankton and red tide phenomenon which is affecting mariculture and aquaculture industries in the south-west. I do not know if it is as prevalent elsewhere on the Atlantic seaboard. Anything that could be done to alleviate this problem would be a vital step towards improving conditions for those industries.

The marine research vessel Celtic Explorer will cost £25 million. Will that sum have to be paid once the vessel’s construction is completed or will it be paid in instalments? I note the vessel will be available next October and that its duties will include survey work as part of the national seabed survey. Some of the companies prospecting for oil in the Celtic Sea and Porcupine Bank are not making much progress. I presume the Department is ensuring that all developments in the sector are being monitored. Some of the exploration companies have been known to locate wells but leave them untapped for a generation or more until such time as they become more profitable.

I would like the Minister to accelerate the development of our fishery harbours. Infrastructure is the most important issue for the marine industry. When proper infrastructure is in place, the marine industry will expand and benefit the economy as a whole. Our natural industries are agriculture, fisheries and tourism. We are too far north of the equator to avail of the wine or citrus fruit markets and must nurse and expand our national resources. The more money the Minister can acquire to develop piers and harbours, the better. The Minister can be assured of my support in this area.

We seem to be only toying with fish processing. It amazes me that the Germans can process herrings in wine, oil and beer and export them all over the world. The Dutch and the Danes are also very efficient in this type of processing, I would like the Minister to put more emphasis on fish processing in this country. It is no good exporting our raw materials to Spain, for example, when we could process them here.

Minister for the Marine and Natural Resources (Mr. Fahey)

I thank the speakers for their contributions. Biotoxins are a natural phenomenon which, although confined in the past to the summer months, are becoming more complex due to a longer cycle. We do not know what causes them although there is speculation that they may result from global warming or increases in ocean temperature. Biotoxins are more prevalent in the south-west than in the north-west. We have learned much from New Zealand where similar problems were experienced about five years ago and are examining their approach in an effort to overcome the problem. The Marine Institute has developed early warning research and monitoring on the phytoplankton organisms in the bay and while we have considerably improved our testing methods, we have not been able to get to the root of this serious problem which could have detrimental effects on the industry. The level of investment in this area has increased substantially.

The purpose of bringing forward payments for the research vessel is to ensure we get it as soon as possible and, in reply to Deputy Sheehan, there are stage payments involved. The non-fulfilment of the licence has to do with the fact that licence 11/85 was relinquished by Skerritt, a Canadian company, because the drilling of the well was not warranted. The company negotiated with the Department a contribution of £500,000 in two instalments of £250,000 each in 2001 and 2002. We do not have the power to enforce the drilling obligation especially where the exploration does not warrant results. We have had well commitments from a number of companies for next year, although not as many as we would have liked. We were concerned by the poor results in the drilling that was carried out this year and that has had a negative effect. One of the tasks we have is to attract the exploration industry to continue to drill off our coastline and this remains the main policy prerogative of our Department.

Sitting suspended at 5.15 p.m. and resumed at 5.35 p.m.

Mr. Fahey

My Department's policy is to encourage exploration and get as many wells drilled as possible. This year's disappointing results have made this much more difficult than heretofore. The number of exploration licences we have now is less than ten and is likely to decline further in 2002.

Deputy Dukes mentioned the G1 subhead concerning fishery harbours and Killybegs in particular. The total approved for Killybegs in 2001 was £1.25 million and there is an underestimate of £280,000. The tenders are currently being assessed and the matter is proceeding as quickly as possible. Nothing could be done about the delay which was due to planning difficulties and to the very complex nature of the project. Obviously we are anxious to proceed but this will clearly depend on the outcome of the budget next week. The Deputy can be assured that this is the top priority in the Department. There has not been any undue delay in the Killybegs project to date. In fact, it has been given a very high priority through the planning process and the delays caused are not the fault of the Department.

The same applies to the other projects such as Burtonport where we approved £1.2 million and have only spent a small amount. The delays were due to negotiations with harbour users and delays in the necessary statutory permissions. The same applies to all of the under-spending. I would be happy to give a full list of the detailed allocations for each of these projects, the amount spent and the reasons for under-spending.

Mr. Dukes

Will the Minister circulate that?

Mr. Fahey

Yes. I underline the fact that there is a very complex set of planning and other requirements for marine projects. We now have to consult Dúchas and deal with SACs. We must pay more attention to the environmental aspect of projects. Very complex planning work must be done and there are often difficulties with site investigations which were not anticipated at the beginning of the process. All of these are factors contributing to delays and increased costs. It is now estimated that the Killybegs project will cost about £35 million which is an increase on the original Estimate of more than £20 million. Killybegs is our primary harbour facility and we are anxious to get on with it. We also want to get on with the other two main projects in Rossaveal and Castletownbere which are going through the planning process.

We expect to launch the processing grants scheme in January. We had intended to do it in November but the Indecon report carried out last year was quite specific in its demand to rationalise the industry. We have a small and disparate processing industry which will not succeed in the future if rationalisation does not take place. As Deputy Sheehan mentioned, our processing industry and the added value to our fish product is quite weak. We have one shot at getting it right with this NDP programme. If we do not, then the seafood processing industry will never be able to get up to speed. The demand from the industry is that we give money to everybody who wants it and that is the reason people may feel we are not going in the right direction.

We are going to be very specific about the criteria for the new scheme. It will not be a question of simply adding freezing facilities or other facilities which will do nothing to the added value of the product. We must have economies of scale which will enable companies to compete on European and world markets, and on the home market. Consequently, we delayed the announcement of the scheme until we were satisfied that we had the right criteria in place and that the industry clearly understood that we will not dissipate the £25 million but spend it strategically. The reason for the delay is that BIM, Enterprise Ireland and the Department are now engaged in an exercise which reflects as closely as possible the criteria laid down in the Indecon report. We will launch the scheme in January.

Deputy Brady asked about poor water quality in the lakes which is caused largely by phosphates from agriculture and by domestic and industrial pollution. Water quality in our inland waterways has decreased substantially and we, together with the Departments of the Environment and Local Government and Agriculture, Food and Rural Development, have taken some steps to try to deal with it. This is a serious problem which must be tackled more effectively than it has been in the past.

With regard to the issue raised by Deputy Sheehan regarding the Celtic Explorer, payments are being made in four stages. The reason we brought forward this stage is that the construction of the boat is proceeding quickly and we did not want to hold it up.

The amount of money allocated to various sectors of the Department has increased substantially over the past number of years. In the past 12 months there was unprecedented investment across the spectrum. In the inshore fisheries sector, for example, where most fishermen are employed, the allocation increased from £80,000 to £2 million. The Estimates will show that we are in a more difficult situation this year and there will be some cutbacks as a result of the changed financial position. Deputy Dukes, more than most, will know that discipline is required in the public finances. We must carry our share of that discipline and must bear the pain——

Mr. Dukes

When I preached that, the Minister was not keen to hear it. If he had listened to me sooner, things would have been better.

Mr. Fahey

I was one of the people who enthusiastically supported the Deputy's Tallaght strategy and I have often said, publicly and privately——

Mr. Dukes

That was not when it counted. It counted back in 1983. The Deputy was not keen on it then.

Mr. Fahey

It was a major contributor to the success we have had in the years since then and to do anything other than implement the financial restraint required in this year's Estimates and budget would leave this industry, and many others, in a far weaker position in the years ahead. The Deputies will understand, therefore, why there will be a more difficult situation this year than last year. Hopefully, however, last year's circumstances will return.

Mr. Dukes

There will be better managers after next summer.

Chairman

That concludes our consideration of the Supplementary Estimate in respect of the Department of the Marine and Natural Resources. I thank the Minister, Deputy Fahey, and his officials for attending the meeting and I thank members for their contributions.