I move that the Bill be now read a Second Time.
This Bill, like the recent dairy produce marketing legislation, derived from a report made by the Advisory Committee on the Marketing of Agricultural Produce; and the Bill is primarily directed towards the improvement of the export marketing arrangements for bacon and other pigmeat. Unlike the case of dairy produce, where there was no general control board already existing, a statutory body—the Pigs and Bacon Commission—has existed in this case since 1939; and, in fact, the Commission then established took over the functions of a Bacon Marketing Board and a Pigs Marketing Board which had been created by legislation in 1935. In view of the existing corpus of legislation on the marketing of pigs and bacon, the present Bill is therefore in the form of amending legislation. There is undoubtedly some inconvenience in this but a codification of the pigs and bacon legislation would only have delayed matters. In order to assist Deputies in following the provisions of the Bill, with particular reference to the earlier statutes, an explanatory memorandum has been circulated which I hope has been found useful.
Deputies will recollect the White Paper issued in December, 1959, stating the Government's policy on the Reports of the Advisory Committee on the Marketing of Agricultural Produce, including the Committee's Report on the Export of Bacon and Other Pigmeat. As indicated in the White Paper, the main recommendation of the Advisory Committee in relation to the export of bacon and other pigmeat was: that the export of bacon, in the form of Wiltshire sides and major cuts including the back, should be centralised in a re-organised Pigs and Bacon Commission which would export a steady weekly quantity to a reduced number of agents in Britain. The Government agreed that the centralisation of these bacon exports would have certain advantages in strengthening the organisation of sales in Britain; and stated that it was proposed to introduce legislation for that purpose and for re-organising the membership of the Pigs and Bacon Commission. These are the two central purposes of the Bill now before the House, which I would remind Deputies is concerned primarily with the export marketing aspects of the pigs and bacon industry.
Before passing on to the particular provisions of the Bill itself, I should like to make some remarks on the situation generally regarding exports of bacon and pigmeat. Since the ending of the bulk purchase of pigmeat imports by the British Ministry of Food in 1956—and, under our pork and bacon agreement with the Ministry from 1951 to 1956, we received fairly satisfactory average purchase prices— we have had in operation a system of guaranteed minimum prices to producers for good-quality bacon pigs known as Grade A and Grade B, and a corresponding guaranteed export price to curers for Grade A bacon. The market assurance thus provided for pig producers, and the incentive to improve quality, have proved valuable but of course there are other factors to be taken into account also. At the beginning of May last, a further price assurance and incentive to better quality was provided by the Government in the form of an appreciably higher guaranteed minimum price for Grade A Special pigs, and a correspondingly higher guaranteed export price for Extra Selected bacon. In the ten months ended 28th February, 1957, 62 per cent. of the bacon pigs graded at factories reached Grade A standard as compared with 69 per cent. in the ten months ended 28th February, 1961, and of the latter 12 per cent. reached Grade A Special standard. Other schemes such as pig progeny testing, boar performance testing, and pig herds accreditation, are now in operation to help in securing the necessary advances on the breeding side. Piggery grants have recently been increased also to encourage more efficient rearing and fattening methods.
The present guaranteed minimum prices of 245/- per cwt. dead-weight for Grade A Special pigs, and 230/- per cwt. for Grade A pigs, are I think accepted as reasonably remunerative for producers who are interested in a serious way in pigs. The actual prices paid of course exceed at times these minimum prices. Pig production has been at a relatively high level during the past three or four years, and has increased substantially since the latter part of 1959. In fact, the 1960 census figures of 967,200 total pigs, including 108,400 sows, were a record for the past 20 years. In the last pre-war census, 1939, total pigs numbered 930,900, including 95,300 sows. In 1950 the number was 644,900 total pigs, including 79,800 sows. Pig deliveries to bacon factories in 1960 were 1,298,000 as compared with an average of 1,026,000 for the years 1937-1939. Already in 1961 deliveries in the first ten weeks are up 17.3 per cent. on the corresponding period of 1960. A noticeable feature now, however, is the decline in pig numbers in the western counties as compared with pre-war.
Export market conditions for pigmeat (especially bacon) in Britain— by and large the only market—have at times been anything but satisfactory. Our bacon support arrangements have to be related to the prices fixed weekly by the London Provision Exchange; and, frankly, we often find it rather difficult to follow the relative pricing of Irish bacon on the Provision Exchange lists and the variations in this. For example, on the 18th June last Irish Extra Selected and British bacon were both priced 263/- per cwt. and Danish bacon 7/- higher at 270/-. By 1st October the Irish price was down by 22/- to 241/- per cwt., the British price was up by 7/- to 270/- per cwt. and the Danish price was up by 20/- to 290/-.
By 18th February, 1961, the Irish price was down by a further 7/- to 233/- per cwt., the British price was down by 30/- to 240/- per cwt. and the Danish price was down by 40/- to 250/- per cwt. No variations in the relative standards of the bacon could be detected to account for this. Even at our increased level of bacon exports in 1960 our supply represented only 5.5% of British bacon imports and 3.8% of total British bacon supplies; and the fact that these exports were sent in widely varying amounts from 36 exporters to even more than that number of purchasers or agents in Britain, and were not all of uniform presentation and so on, did not help us.
The Advisory Committee, which I specially asked to look at these pricing aspects, were not satisfied either in regard to the fluctuations of the price margins from time to time. Summing up, the Committee stated: "The impression we have formed of Irish bacon marketing arrangements in Britain is that they are in no way organised and that this leads to lack of confidence in our methods and results in weak selling and the acceptance of unsatisfactory prices."
It is only right to say, however, that, especially since the introduction of the A Special grade for pigs last May and the Extra Selected grade of bacon (all of which is exported) we have many encouraging reports that the quality and presentation of our bacon exports to Britain have been showing good improvement. But, to get the most out of the market, the case for a unified handling of our, at best, small share of the British bacon trade is very strong.
I may also refer here to the arrangements made last autumn, in view of the uncertain bacon market conditions, to encourage a greater interest in the pork export market in which Irish supplies formerly held a good place. These arrangements have worked with reasonable satisfaction, although the volume of exports has necessarily been on a limited scale because of market reasons and the desirability of maintaining continuity in bacon exports; but the pork exports have, in six months, resulted in a direct saving of some £38,000 in bacon support—and no doubt much more, indirectly, by holding off extra bacon from a weak market. They also have a useful side effect on both the home and export bacon market in absorbing pigs suitable for pork but not so suitable for bacon.
As to the future of the pigmeat export market it is perhaps difficult to be very optimistic that prices will be high in the times ahead. Demand however is good, and the trade is there, but quite a few other countries are anxious to develop their pig industries too. The situation is, therefore, a challenge to us to become more competitive by economising in every way possible on production costs; by increasing efficiency and improving quality at breeding, feeding and factory levels; and by adopting the most effective methods of export marketing. I have already referred to certain additional facilities and incentives given to pig breeders and fatteners. On the factory side, I would like to refer also to the grants being given for the modernisation of bacon curing premises and to the making available of State assistance to the bacon and meat trades for the establishment, by these industries themselves, of a meat research unit. Both of these developments were foreshadowed in the White paper on the Government's Programme of Economic Expansion.
Turning now to the actual provisions of the Bill, I will first take Sections 7 to 9 dealing with the re-organisation of the membership of the Pigs and Bacon Commission. The 1939 Act provided for a Chairman and two ordinary members, both of them being required to have served for at least eight years as officers of the Minister; the Chairman is at present also a Departmental officer. The Marketing Advisory Committee recommended that the Commission be re-organised to consist of three members nominated by pig producers, three nominated by bacon curers and pork exporters, two officers of the Department of Agriculture and an independent Chairman selected by the eight other members. The White Paper on the Committee's reports stated that the Government proposed that the re-organised Commission include two representatives of producers, two representatives of curers and two Departmental officers in addition to the Chairman. In the Bill, this is changed by an increase of one in the curers' representatives and a reduction of one in the Departmental representation. The reason for the change has been that since the issue of the White Paper strong and unanimous representations were made to the Government by the bacon curers that as the primary purpose of re-organising the Commission was in regard to bacon export marketing and the Commission would have wide powers of control over the bacon curing industry it was inequitable that the representation of curers should be only two out of seven.
The Irish Bacon Curers' Society emphasised that their members, comprising all the curers, could have no confidence in such a body and would fear the possibility of adverse effects so much that investment in the bacon curing industry would gravely suffer. In the circumstances it was decided to increase their representation to three and to cut the Government's own representation to one. Producer representation was left unchanged at two, which is regarded as reasonable especially as the position of producers is safeguarded by the provision of guaranteed minimum prices for bacon pigs. Contrary to what has been suggested in some quarters the representation of curers, major aspects of whose industry the Commission will control, will not be a majority but three out of a total of seven. There would not be much point in keeping the curers' representation at two if, as was clear, they—the processing and exporting industry concerned—would lack confidence in the re-organised Commission before it commenced.
The Bill proposes that the period of office of the members of the Commission would be three years at a time. There would be an overlap of one year between the period of office of the Chairman and that of the ordinary members, inasmuch as it is proposed that the Chairman of the existing Commission would be appointed by me as Chairman of the re-organised Commission for the first year. This overlap, which would continue in future, should be useful in securing a degree of continuity in the functioning of the Commission, without going too far in that direction. After the first year, the Chairman would be selected by the six ordinary members for a period of three years at a time.
The other major part of the Bill is contained in Sections 23 to 25, which provide for the centralisation, through the Commission, of exports of bacon of specified grades in the form of Wiltshire sides and major cuts which include the back. The intention is to apply this to exports of bacon of not less than Grade A standard to the British market, which as I already said takes practically all such exports. The possibility cannot be excluded that it may be desirable to apply the provisions to exports of other grades or to other markets, hence the general nature of the relevant Sections.
In this connection, orders under Section 25, prohibiting the export of bacon except by or on behalf of the Commission, will of course come before the House under Section 31. As to the precise lines on which the centralisation of actual exports by the Commission would operate, I think that this would have to be left to the Commission itself to determine.
The Commission would, however, acquire title to the bacon before export and would pay curers for it, subject to quality and condition, at prices fixed by me after consultation with the Commission under Section 23 (4) of the Bill. For the benefit of Deputies I may perhaps quote the following recommendations in this connection from the Marketing Advisory Committee's Report:
Paragraph 47. "The bacon should be purchased at an ex-factory price from the curers by the re-organised Pigs and Bacon Commission recommended by us later. This ex-factory price may have to be determined on a rough and ready basis at the start but as soon as possible it should be based on representative costing so that efficient operation of factories will be encouraged."
Paragraph 62. "It (that is, the re-organised Commission) should ship bacon only to appointed agents in Britain, existing trade contacts and arrangements being maintained as far as possible."
Paragraph 64. "Although in the matter of the appointment of agents the Commission should have regard to the curers' nominations, it is important that it should have a free hand in making appointments and also in regard to the renewal of appointments from time to time."
I have quoted these only by way of illustration but as I have said I think it should be left to the Commission itself to decide what is best to arrange in these marketing matters.
Section 27 dealing with powers of the Commission in relation to the development of markets for bacon and other pigmeat, Section 28 dealing with State grants to the Commission, and Section 29 dealing with State guarantee of loans to the Commission are, with appropriate modifications, in line with corresponding provisions in the recent Dairy Produce Marketing Act. I need perhaps at this stage refer in particular only to subsection (g) of Section 27, which gives the Commission ample powers in regard to the development of exports of pork and other diversified pigmeat products. In view of modern trends in regard to pre-packaging, especially with the advent of supermarkets and self-service stores, I am taking powers under Section 26 of the Bill to make regulations on aspects of pre-packaging which, as mentioned in the explanatory memorandum, would compare with control already exercised in regard to canned and open-pack meats of other kinds.
The position of the staff of the existing Commission is suitably safeguarded under subsection (10) of Section 12 of the Bill. As in some other recent legislation, subsection (5) of that Section provides that the manner of the appointment of staff will be by public competition, subject to certain special exceptions which are specified. Provision is made under Section 22, again as in other recent legislation, enabling a staff superannuation scheme to be considered.
The remaining sections of the Bill are, I think, more what one would term "Committee Stage" sections, but I shall of course be glad in replying on this Stage to deal with any points Deputies may wish to raise on any of them.
