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Sugar Beet Sector.

Dáil Éireann Debate, Tuesday - 4 July 2006

Tuesday, 4 July 2006

Questions (488, 489, 490, 491, 492)

Jack Wall

Question:

501 Mr. Wall asked the Minister for Agriculture and Food the position of the discussions on the compensation payments for the sugar beet growers; when the final decision will be made in regard to this matter; if there is an appeal system available to applicants for reaching the final agreement; and if she will make a statement on the matter. [25535/06]

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Jack Wall

Question:

502 Mr. Wall asked the Minister for Agriculture and Food her views in relation to the beet growers’ concerns in regard to the share of the EU compensation that will be allocated to the growers; her further views on correspondence (details supplied); and if she will make a statement on the matter. [25536/06]

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Jack Wall

Question:

524 Mr. Wall asked the Minister for Agriculture and Food if the continued participation of Greencore in the sugar industry impedes or effects their application for a share of the reconstruction fund as agreed by EU Ministers; and if she will make a statement on the matter. [25889/06]

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Jack Wall

Question:

525 Mr. Wall asked the Minister for Agriculture and Food the position of the Mallow and Carlow factories and the refining machinery of both processing units in relation to the reconstruction fund; will the plants be dismantled before the fund is available to all applicants; and if she will make a statement on the matter. [25890/06]

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Jack Wall

Question:

526 Mr. Wall asked the Minister for Agriculture and Food if she has been notified of environmental problems or difficulties that have arisen due to the closure of the Mallow and Carlow sugar factories; and if she will make a statement on the matter. [25891/06]

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Written answers

I propose to takes Questions Nos. 501, 502 and 524 to 526, inclusive, together.

The compensation package negotiated as part of the agreement on reform of the EU sugar regime contains three elements. The first element is the compensation to beet growers of up to 64% of the reduction in the minimum price for beet. This compensation, which will be incorporated in the existing Single Payment Scheme and will be payable from 2006, is worth approximately €123m to Irish beet growers over the next seven years.

The second element of the compensation package is the restructuring aid covering the economic, social and environmental costs of restructuring of the sugar industry involving factory closure and renunciation of quota. In Ireland's case, this would be worth up to €145m.

The third element of the package is the diversification aid, worth almost €44m in Ireland's case, which would be drawn down in the framework of a national restructuring programme to be prepared and submitted to the Commission by the end of the year.

Regarding the second element, the restructuring aid provided for in Council Regulation (EC) No 320/2006 is subject to the submission by the processor of a detailed restructuring plan for the industry following consultations with the beet growers. The Regulation also provides that at least 10% of the restructuring aid shall be reserved for sugar beet growers and machinery contractors in order to compensate for losses resulting from factory closure under the restructuring scheme. That percentage may be increased by Member States after consultation of interested parties provided that an economically sound balance between the elements of the restructuring plan is ensured. In that context, my Department in May issued an open call for submissions which will be subject to scrutiny by Indecon International Economic Consultants, who have been appointed by the Government to provide me with independent expert advice on matters relating to the implementation of the restructuring aid. Those who made submissions were subsequently invited to a series of consultation meetings to afford them the opportunity to make any supplementary points regarding their submissions. This consultation process is separate from any consultations engaged in by the processor. A final decision on the percentage will be made shortly having regard to the independent expert advice and following the recent publication of the Commission Regulation laying down detailed rules for the implementation of the restructuring aid.

The timescale for implementing the restructuring aid is very tight where, as in Ireland's case, restructuring takes place in the first year of the new regime. The Council Regulation requires that the application for restructuring aid must be made by the processor by 31 July 2006. The application must include a detailed restructuring plan for the industry, including an environmental plan detailing the actions planned. The application will be considered when received and a decision on the application must then be made by the Member State by 30 September 2006 at the latest.

It is my intention that the restructuring aid will be implemented in a fair and equitable manner and strictly in accordance with the relevant EU regulations. The Regulations do not provide for an appeal system. Sugar factories that had closed before 1 July 2005, such as the Carlow factory, do not come within the scope of the restructuring aid. I have not been notified of any environmental problems or difficulties that have arisen due to the closure of the Mallow and Carlow sugar factories but, in any event, any such issues would be a matter for the environmental authorities.

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