I move:—
That, in view of the economically disastrous consequences which must ensure if there is a serious decline in the value of agricultural produce after the war, Dáil Eireann is of opinion that a five-year plan should be drafted and promulgated by the Government, which will guarantee remunerative minimum prices for the chief products of agriculture.
It will be admitted that this is a very important motion, seeing that the basis of our economic existence depends on the agricultural industry and that that industry depends upon the remuneration which those in it receive. If those engaged in agriculture are not adequately rewarded for their labour and enterprise it is inevitable that production will decline in volume as well as in efficiency. This motion seeks to give some security to those engaged in our basic industry over a period of years. We are all familiar with the disastrous consequences that followed the previous European war. That war produced for agriculture a condition of prosperity for a period of four or five years, but that position came to an end about two years after the termination of the war, when there was a collapse in prices of agricultural produce and of live stock. The collapse resulted in a drastic reduction in farmers' incomes as well as in the incomes of labourers. Farmers who took live stock to fairs found that they were unsaleable, and after some months had to dispose of them at prices that were little more than 50 per cent. of their value.
Employers then had to say to their workers: "I am cut 50 per cent. in my earnings; you must take a smaller cut." There followed a rather bitter conflict between agricultural workers and employers. In some counties the bitterness was more intense than in others, but in all counties it was a state of affairs to be deplored. If farmers and their workers, instead of accepting a state of affairs that was dictated to them after the war, had united and insisted upon guaranteed remunerative prices for agricultural produce, the deplorable conditions experienced in agriculture during the past 20 years would have been avoided. There would not have been such a reduction in the number of people employed on the land, nor such a decline in agricultural production and efficiency.
The advantages of having secured prices for agricultural produce should be obvious to everybody. Such security would mean that agricultural producers could plan with something like the same measure of safety that big manufacturers have when planning their output. For example, manufacturers of motor cars, tractors or agricultural implements can make a reasonable forecast of the price they are going to obtain, and can thereby plan to pay wages in accordance with such prices. Farmers have no such security at present. In Great Britain there has been a continuous agitation during the past few years for secured prices, in order to avoid the conditions which followed the end of the previous great war. It is realised that if such conditions arise after the present war they may be on a more disastrous scale. After the first great war a reduction in agricultural prices was followed by a reduction of wages. At that time the workers were, perhaps, more inclined to accept reductions and to regard them as inevitable than is the case now. The standard of wages generally is somewhat higher now, and there is certainly a stronger feeling amongst workers against accepting drastic reductions in wages. In addition to that, we have the marked contrast between the earnings of those engaged in agriculture and the earnings of those engaged in industry and sheltered occupations. There is hardly any justification for a lower standard of income for the skilled worker in agriculture than there is for the skilled worker in other industry.
It may be said that these proposals are all right, but the question is, can they be implemented, is it possible to guarantee to the primary producer in this country a reasonably remunerative price over a period of years? I intend first of all to set out what I consider to be a reasonable basis for fixing prices for agriculture. The only reasonable basis for fixing agricultural prices must be the costs of production in the industry. Costs of production must be based, first of all, on a reasonable wage for those engaged in the industry. The question must be approached from that standpoint. The worker must get a reasonable return for his labour. Having fixed a reasonable wage for the worker, costings must be based upon that wage. The costs of production having been decided, a reasonable margin of profit must be provided for the farmer, and the price of the commodities must be fixed accordingly.
It may be said that it is not possible to fix the price of every agricultural product. I am prepared to agree that it would be extremely difficult to do so. We are not pressing, in this motion, for the fixing of the price of every product of agriculture. We suggest that prices should be fixed for the chief products of agriculture, by which we mean mainly the key products. As far as certain commodities produced for human consumption within this country are concerned, no great difficulty is raised by this motion. Wheat prices have been fixed for a number of years, and the administrative problem involved in guaranteeing wheat prices is not insurmountable. It has been possible up to the present to fix prices for wheat for one year in advance. I maintain—and I think no reasonable man can dispute—that it would be equally possible to fix a price for wheat for four or five years in advance. I do not intend at the moment to discuss the price that has been fixed for wheat, as to whether it is fair or unfair. I wish broadly to outline the case that it is possible to fix a price for wheat as it is required for the home market. In these circumstances, the price can easily be controlled. In connection with wheat, the question might naturally arise as to whether or not it should be the policy of the State to continue growing wheat after the war. I think most reasonable people are of the opinion that we must continue to cultivate a substantial acreage of wheat after the war.
As long as the people of this country rely upon bread as their principal article of diet, I think it is wise policy to ensure that at all times there will be a sufficient acreage of wheat cultivated in this country to make it possible, even if we do not grow 100 per cent. of our requirements, to expand the acreage up to 100 per cent. of our requirements should an emergency occur. We must, therefore, face the fact that after the war we shall have a very substantial acreage under wheat.
The same considerations apply in regard to sugar beet. At present we are producing, I think, 100 per cent. of our requirements of sugar and there does not seem to be any valid reason why we should not continue to do so in future.
We find, in relation to the two commodities I have mentioned—wheat and sugar beet—that it is possible and easy for the State to fix a guaranteed remunerative price, not only for one year, but for a period of years. But a guaranteed price for wheat and sugar beet only would not go very far in giving the farmers of this country economic security. The total area required in order to supply 100 per cent. of our requirements in both sugar beet and wheat would be less than 800,000 acres. That is only a comparatively small fraction of our total agricultural land. There are something in the neighbourhood of 15,000,000 acres of land. including agricultural and grazing land. If we are going to provide security for the farmer only in relation to the produce of 800,000 acres, we will not give the farmer economic security or safeguard him against the risk of huge loss which might follow from a collapse in the price of, say, agricultural exports. We must go further and, I maintain, the next step is to consider dairy produce. The production of butter, milk, etc., forms a large proportion of our agricultural industry. They are commodities for which there is a huge and, I think, a growing home market. As far as milk for home consumption is concerned, there ought not to be any difficulty whatever in fixing a price for a long term. At present, we have fixed prices for milk supplied to the larger towns and cities and that does not involve any great difficulty. With regard to butter, it is possible and probable that we shall have a surplus for export and in considering this question we must try to devise ways and means of maintaining the price at a remunerative level. No matter how far production is expanded, our exportable surplus will be only a fraction of the total output.
We have to see that the price of that exportable surplus, if it declines, does not pull down the price of butter on the home market and leave the producer without a possible chance of getting a profit. Therefore, it will be necessary, by some means or other, to create a fund to stabilise the price of any butter which may be exported. In this connection, of course, we shall always have to have regard to a number of important considerations. If the State is called upon to supplement the price of butter, owing to the fact that the price of the exportable surplus is low, the first consideration will always be whether or not it is desirable to export butter. A decision on this matter would have to be taken, bearing in mind the price obtained for the butter in the external market and also other considerations, such as the necessity for exporting butter in order to import some other commodity in return; because it is almost inevitable that in the post-war period there will be a certain amount of barter in regard to external trade. Therefore, a decision in regard to whether or not we should export will have to rest, first, upon the price we obtain and, secondly, on the value of the goods we get in exchange.
What is true of butter is equally true of bacon pigs. We are not at present producing a sufficient amount of bacon for export; but we have reasonable ground to hope that we will have a substantial exportable surplus in the post-war period. Here again it will be necessary to ensure that the price of the exportable surplus does not pull down the price in the home market. Therefore, it will be necessary to create a fund to be used, when necessary, to stabilise the price of bacon. I want to make it clear that the stabilising of the price of bacon pigs and dairy produce will go a long way towards ensuring stability of income for the farmer, because the dairy industry and the pig raising industry are consumers of a very large proportion of the produce of agriculture.
I am not one of those who suggest that everything produced on the land should carry a guaranteed price. For example, I am not suggesting that tillage produce required as feeding stuff for live stock should command a guaranteed price. We have demands from time to time for guaranteed prices for tillage products which are used mainly as feeding stuff for cattle and pigs. I do not think those demands can be sustained or should be met by the State. If the farmer is unable to obtain good prices or reasonable prices for certain tillage products and has the alternative of turning these particular products into butter or bacon or eggs and getting a decent price for those products, then he has nothing serious to complain about. That is why we hold that dairy produce should certainly be guaranteed in regard to price, and that bacon pigs should also carry a guaranteed price. I think the same considerations apply in regard to eggs. I am not suggesting that every branch of the poultry industry should be adequately protected; but eggs, at any rate, as the chief product of the poultry industry, should carry a guaranteed price.
It will be noticed that I have left out of this list two of what would be regarded as the most important products of agriculture, namely, cattle— fat cattle and store cattle—and sheep. I have left these out for the moment. So far as cattle are concerned, I hold that a long step will be taken towards assisting the cattle-raising industry by ensuring that dairy produce is safeguarded. With regard to sheep, I hold also that it would be a difficult matter to have a guaranteed price in regard to this form of live stock. I think, however, that there would be no difficulty about guaranteeing a price for wool. Wool is a product required in industry, and required to a very substantial extent in industry within this country. Just as people who manufacture wool into clothing are adequately protected and assured of a reasonable profit and their interests are in every way safeguarded, the farmer who keeps the sheep that produce the wool is entitled to the same measure of protection.
Lastly, I come to deal with barley and oats. I have pointed out that barley and oats are required to a very large extent as feeding stuff for live stock; but a percentage of both of these cereal crops is required for human consumption. Barley is required to a considerable extent in the brewing and distilling industry. Oats are required to a very considerable extent in the milling industry for human use. The point which I want to make in regard to these two crops is that it would not be possible for the State to guarantee a price for an unlimited acreage of oats or barley; but it might be worth while considering the desirability of fixing a price for the limited acreage. For instance, a certain number of farmers in a district eminently suitable for barley growing would contract to grow barley for the brewing and distilling industry. They would enter into a definite contract for a certain acreage and they would be assured of a price for their product, just the same as the beet growers are assured of a price. The same would apply to oats for milling. It should be possible to segregate certain areas, particularly areas where the land is inferior and where it is difficult to grow wheat profitably. In such areas the farmers might be allowed to contract to grow oats for the milling industry and have the security of a guaranteed price.
If the various products of the agricultural industry which I have named are assured of a reasonable price over a certain number of years, say five years, I think we will have a certain safeguard against a disastrous decline in agricultural income, and that is what we have to secure at any cost, no matter how great the difficulties are. We may be told that the country could not afford such a scheme. I assert that the country cannot afford to allow the agricultural industry to sink into the condition in which it was before the present war.
Another point which I should like to emphasise in regard to security of price is that it would make for a higher standard of efficiency in the industry. For example, if there is security in regard to the price of wheat, we can hope to get improved varieties of seed, and, which is more important, greater efficiency in production. The same observation apply even to a greater extent in regard to dairy produce, because dairying is a long-term industry, and the man who wants to engage in the production of either milk or butter has to plan many years ahead. It will take many years to build up a dairy herd, and, unless there is reasonable security, the farmer cannot go all-out to get the best dairy cows and build up a most efficient herd. I had experience in my own district of a creamery established in 1929 or 1930. A number of farmers put their capital into the building of the creamery, and also into the purchase of dairy herds to supply that creamery. I found that in a few years they were selling off their dairy herds at less than half the price that in some cases they had paid for them, because the price of butter had collapsed in the meantime and the whole business was uneconomic. You cannot have efficiency in an industry while you have violent fluctuations in price.
Another consideration is that violent fluctuations in price lead to extensive profiteering. As long as farmers are engaged in producing in an isolated way throughout the country, they are always at a disadvantage in regard to price fluctuations, because they are the last people who get inside information as to the trend of prices. Cattle dealers and people closely associated with the cattle trade can always know what way prices are tending. The same applies to corn, wool, and practically every product of the land. The producer is the last person to know what way markets are tending and he is at a disadvantage. In addition to that, there is the fact that these fluctuations enable the middleman to extract a much larger rake-off than if prices were stabilised, because he can always deceive the producer and the consumer. He can quote to the consumer the peak price which has been paid to the producer as the average price. In that way he can rake off an excessive price which would not be possible if the price were stabilised. I recommend the motion to the House. I think that if accepted it will go a long way towards putting the agricultural industry on a firmer foundation.
