That a sum not exceeding £12,723,410 be granted to complete the sum necessary to defray the charge which will come in course of payment during the year ending on the 31st March, 1963, for the Salaries and Expenses of the Office of the Minister for Agriculture, including certain Services administered by that Office, and for payment of certain subsidies and sundry Grants-in-Aid.
I propose also to move after the debate on this Estimate a Supplementary Estimate to provide £1 million in respect of creamery milk price allowances to enable creameries to pay an additional 1d. per gallon for milk, and a grant-in-aid to the Pigs and Bacon Commission for the development of export markets. I will deal with these two items in the course of this speech so that the debate may cover both the Main and Supplementary Estimates.
The total net Estimate for 1962/63 shows an increase of £2,928,250 on the original net Estimate for 1961/62, which amounted to £16,145,160. Including the Supplementary Estimate provision for 1961/62, the final total Estimate for that year was, in fact, £26,445,510.
As compared with the original Estimate for 1961/62, the following subheads in particular show substantial increases: K. 11—Bovine Tuberculosis Eradication Scheme; K.8—Lime and Fertiliser Subsidies; N—Marketing of Dairy Produce; K. 14 —Payments to the Pigs and Bacon Commission; I.6— An Foras Talúntais; K. 6 — Farm Buildings Scheme.
Only a few items show a decrease compared with the original Estimate for 1961/62.
Deputies have received a memorandum entitled "Notes on the Main Activities of the Department" giving detailed information on the operations of my Department and on various trade and economic matters with which it is concerned.
Despite some difficulties brought about by unfavourable weather in the latter part of the harvest season last year, and in face of obstacles on external markets, our agricultural industry can look back on a year of striking progress, a year in which new records were achieved in production and exports. Although total cattle in June, 1961, were slightly below the previous year's record level, the numbers of cows and heifers-in-calf had increased; sheep numbers were the highest recorded this century, and pigs were at the highest peak since 1935. The 1961 barley acreage showed a substantial increase, and, although the oats and wheat acreages were lower than in the previous year, the tonnage of wheat produced was slightly higher than in 1960. Potato production in 1961 also increased, despite a lower acreage. Agricultural exports, including processed agricultural products, reached a new record level of £112,000,000 in 1961 and accounted for nearly 70 per cent of total exports. The increase of £27.6 million in total exports in 1961 was largely due to increases in our agricultural trade. There were substantial increases in exports of fat cattle, store cattle and beef, and the total number of cattle exported alive or as meat was the highest ever. Of the 426,000 store cattle exported, 80 per cent were attested—a marked increase on previous years.
The increases in production and exports were reflected in significant increases in the value and volume of agricultural output. Gross output for 1961, excluding the value of livestock changes, is provisionally estimated at £211,000,000, an increase of £16,000,000 over 1960. There was a slight reduction in the value of stocks at the end of 1961, accounted for by a decline of 112,000 in cattle numbers, which was, however, accompanied by rises of 269,000 in sheep numbers and of 135,000 in pigs. The value of these changes in stocks was estimated at £3,000,000, and, when these are taken into account, gross output in 1961 at £208,000,000 was £13,500,000 over the 1960 figure. The value of inputs of feed, seed and fertilisers increased by more than £4,000,000 in 1961. Allowing for this increase and for increases in other farming expenses, it is estimated by the Central Statistics Office that the income of farmers (including employers) rose by £8,000,000 between 1960 and 1961. When output for the two years 1960 and 1961 is compared at constant prices, gross agricultural output, including livestock changes, rose by about 4½ per cent. and net output by 2 per cent. These figures are very encouraging. They show that our agriculture is continuing to make steady progress, that output, productivity and incomes are all advancing. They utterly confound the absurdly gloomy forebodings which our more biassed critics love to indulge in.
It has been suggested that our exports were high last year because we were living off our livestock capital, but the facts are that the total of milch cows and heifers-in-calf and the number of cattle under 2 years on farms last January was higher than in January, 1961. Sheep and pig numbers also showed substantial increases in last January's sample census. The long-term trend of crop yields continues upward. These production records are obviously influenced by the various improvement schemes operated through my Department and the County Committees which, coupled with the reasonably stable price and marketing arrangements for the great bulk of our production, have contributed to the substantial increase of £8,000,000 in farm income in 1961 over 1960—itself a record year. And it should be noted that, in calculating this income figure, expenses such as purchase of materials, maintenance of machinery, depreciation, rates and rent have been taken into account. Criticisms of the state of agriculture, if they are to be helpful, must first begin with an acceptance of these fundamental facts of progress.
Nobody denies that we have agricultural problems, as has every other country without exception, but it is useless to pretend that striking advances have not been achieved in recent years, or that these advances have not been greatly facilitated by liberal Government assistance. The action taken in the recent Budget to relieve farmers of a burden of £2,500,000 in rates and taxation, and more recently to enable the creameries to pay an additional penny a gallon on milk, amounting to £1,250,000 in a full year, furnishes further proof of the Government's concern to improve the position of the farming community as far as lies in their power.
At the same time, there are certain facts which cannot be ignored. We have to remember that one-half of sales off farms has to be sold on export markets where prices are in many cases quite uneconomic, and that this half represents some 70 per cent. of our total export trade. In these circumstances, nobody can seriously question that the Government are right in placing the main emphasis on measures which will increase production and reduce farm costs relative to sales receipts. There are limits to the extent to which either this or any other Government can go to help farmers by way of additional price supports. I agree that price supports are very necessary, but our agricultural future will depend much more on better farming than on increased price support. The Government are providing generous assistance to increase productivity under a variety of schemes, as well as spending considerable sums on price support.
Export markets are extremely competitive and we must therefore concentrate on improved marketing as well as on increased agricultural productivity, while looking to better regulation of international markets to improve selling prices. An Bord Bainne and the reorganised Pigs and Bacon Commission have assumed very important responsibilities and, to assist them in the discharge of their market development functions, considerable sums of money are being made available to them from the Marketing Fund established some years ago. A sum of £100,000 was recently handed over to An Bord Bainne for this purpose and it is also my intention to pay over a substantial sum from the same Fund to the Pigs and Bacon Commission. These bodies are assured of Government support in the carrying out of whatever measures are necessary to improve our marketing methods and diversify our exports.
Turning, now, to some individual products, I will take cereals first. There has over the years been a good deal of controversy about the millability of wheat. Farmers' organisations have alleged that rejections of wheat by millers were excessive. The millers have asserted that they have taken the maximum quantity of wheat for milling, consistent with their obligations to produce flour of a quality acceptable to the consumers. This has been very largely a barren controversy and I am therefore very pleased at the recent announcement of an agreement between the growers and the flour millers for the joint operation of a Cereals Laboratory. This is the type of arrangement which I had looked forward to for a long time, and, while I do not expect it to solve all our problems, I am satisfied that it is a step in the right direction, and I have already assured the sponsors of the agreement of my fullest support and co-operation.
Production of feeding barley continues to increase, and this year's acreage is expected to be a record. A large proportion is fed to livestock on the farms on which it is produced, and the arrangements for the marketing of the balance of the crop which I have made in co-operation with the Federation of Irish Feeding Stuffs Manufacturers have worked satisfactorily.
As regards milk, we had a record production in 1961, and production so far in 1962 is higher than in the corresponding period of 1961. The amount of money paid to creamery milk suppliers in 1961 was the highest ever—£24,732,000.
We must realise, of course, that the marketing of dairy products gives rise to serious problems. There is no need at this stage to go back over the history of the difficulty that arose with Britain last autumn, as the duty which was then imposed on imports of Irish butter was removed some months ago following negotiations between the two Governments. In the present financial year, our exports to Britain may not exceed 12,000 tons, but all the indications are that our exportable surplus will be substantially greater. While the market price in Britain has improved as a result of the import quota régime which is now operated by that country, considerable assistance from State funds is still necessary to bridge the gap between the export price and the price which we have guaranteed to pay to creameries for butter. The marketing of butter in excess of the 12,000 tons for the British market will be no easy task for An Bord Bainne, but they are pursuing this task with determination and zeal.
There was only one way of meeting the cost of the recent increase of 1d. per gallon in the price of creamery milk, and that was out of taxation:—
(i) Raising the home price of butter to absorb the increase in the price of milk would cause a decrease in consumption and thereby push up the quantity for export, thus accentuating our marketing problems and increasing the amount of the loss on exports, which is shared between the State and the milk producers.
(ii) The fact that per head consumption of butter in Ireland is the second highest in the world is a great advantage which we have been able to use with telling effect in international negotiations. It would be folly to throw away this advantage.
(iii) An increase in the gap between the domestic price of butter and the price in export markets would be contrary to policies laid down internationally, for example by the OECD, and would incidentally be an added incentive to butter smuggling.
Pig production has been increasing since 1959 and this trend has continued during the past year. While our internal price arrangements have kept the position fairly satisfactory for producers and processors, the export market situation in general has not been moving at all favourably. Export market prices for bacon and other pigmeat have been at a low level for most of the past year and the prospective supply position does not offer much hope of an early improvement.
Under these difficult conditions it is more necessary than ever to press ahead with ensuring that the quality of our pigs and the standard of our bacon exports are raised to the highest possible levels quickly. About three months ago certain bacon pig grading changes, to take place in three stages up to the beginning of next year, were therefore introduced to meet the requirements of the export market for lengthier and leaner bacon sides. At the same time stricter controls were instituted at bacon factories over the standard and selection of bacon for export. I am glad to say that recent reports from cross-Channel confirm that the quality of our exports has been improving. Our increased exports have taken place in the form of pork carcases, mainly lighter than bacon weight, rather than as bacon and the quality of our pork invariably receives very favourable comment.
I might also mention that during the past few months trial lots of pork have been exported to the United States and it is hoped that a useful outlet for part of our increasing production can be developed there. On the bacon marketing side I am hopeful that the attention by the reorganised Pigs and Bacon Commission to improved export arrangements on the lines contemplated by the Act of 1961 will lead to a strengthening of our position in that respect also before very long. In the present situation it is vital to adopt every possible way of improving things as the indications are that the measure of export support that will be required in the current financial year will probably be even greater than last year.
As regards pig breeding, I should mention in particular the Accredited Pig Herd Scheme which was introduced in the latter part of 1960 and which now includes all the main pedigree herds. The aim of the scheme is to secure the widest possible distribution of the superior breeding stock from herds reaching accreditation standards. A comprehensive report on the first year's working of the Scheme will shortly be issued. As previously announced the extension of pig progeny testing facilities has also been in hands and, while these will be available somewhat later than we would have wished, every effort has been and is being made to provide them at the earliest possible dates.
Unfortunately, the general situation in regard to the poultry and egg export trade has not improved and this branch of livestock production has consequently continued to be depressed. The numbers and exports of ordinary fowl and turkeys have shown some further decline during the last year and in view of the position in Britain where large-scale production has been expanding considerably it has been difficult to see what practicable remedial measures we could take here to develop larger exports.
The Poultry Production Council, representing the various branches of the industry and my Department, which I established pursuant to a suggestion by the Advisory Committee on the Marketing of Agricultural Produce, very thoroughly examined the prospects of developing broiler production for export but their conclusions in a Report made to me and published some time ago were not very hopeful.
There has been some hope of developing a fairly large export trade in day-old chicks and hatching eggs of improved strains based on imports, under very stringent veterinary conditions, of high-class American strains and every encouragement is given by my Department to efforts being made in that direction.
As the House is aware, a useful arrangement was negotiated some time ago with the United States authorities under which some 5,000 tons of sugar were exported to that country on favourable terms, in consideration of the import of a quantity of maize. My Department was glad to co-operate in this arrangement by giving the necessary undertaking in regard to the import of maize.
The Bovine Tuberculosis Eradication Scheme has made very satisfactory progress, and the gross amount provided for the Scheme in the current financial year—£10¾ million—is the largest allocation made so far for this purpose. It is my confident hope that the whole country, apart from six southern counties, will be attested by the end of 1962. The temporary arrangement with the British Government in regard to once-tested cattle will terminate at the end of this year, and this emphasises the importance of going ahead rapidly with the final stages of eradication. It is in the interest of every farmer to give his full support so that his cattle will continue to find satisfactory outlets.
I would like to acknowledge the valuable co-operation we have received from farmers and veterinary surgeons, and to acknowledge also the devoted work of the officers of my own Department in operating the Scheme, and I appeal to farmers in the counties still to be cleared to concentrate on bringing their herds to the attestation stage as quickly as possible. We are launching an all-out effort in the six southern counties during the next couple of months. We are arranging to deploy the maximum forces in that area with a view to attesting these remaining counties in the shortest possible time. How soon this will be, will depend very largely on our getting the fullest support and co-operation from the farmers in these counties. Personally, I have not felt in the past that the maximum degree of support for and interest in the Scheme was always forthcoming in some of these southern counties, though I understand the difficulties that existed. An enthusiastic push by farmers in the South could cut at least a year off the period that attestation of that area will take.
As I mentioned earlier, 80 per cent of the store cattle exported in 1961 were attested. That is a measure of the progress we achieved in that year and undoubtedly we are going to do even better in the future.
I should like, now, to deal with some other major schemes the fundamental purpose of which is to increase our agricultural productivity. I am glad to say that, due to the operation of the fertilisers subsidies, the upward trend in the use of fertilisers has continued. This season the consumption of phosphates was about 50 per cent. higher than in 1957/58, when the subsidy was introduced. The quantity of ground limestone used in the year ended 31st March last was 50 per cent. more than in the previous year. The use of potash has also increased substantially. I do not know of any country in Europe, with the possible exception of Britain, where farmers can buy fertilisers more cheaply than in Ireland. The subsidy scheme is, admittedly, an expensive one, but I believe that it is one of the main keys to our future agricultural development, considering that, traditionally, our fertiliser usage has been far too low.
During the past year, approximately 100,000 acres were reclaimed or improved by farmers with the aid of grants under the Land Project. The backlog of applications has been considerably reduced, and the waiting period between the date on which a farmer applies for a grant and the date on which he receives approval to proceed has been reduced to an average of about four months in almost all areas. The Fertiliser Scheme operated under the Land Project could be profitably used by farmers to a much greater extent than it has been in the past. We have had an encouraging response to the scheme for the fencing of mountain grazings and commonages which was introduced last September, and I expect that activities under this section of the Project will steadily increase in the future.
There has been a rapid response to the increases granted last year in the grants for cowbyres and piggeries and for repairs to farm buildings generally. From the commencement of the Farm Buildings Scheme until the end of the financial year 1961-62, grants totalling nearly £6¾ million have been paid to over 200,000 applicants. This represents a total capital investment by farmers and the State of roughly £26 million. Last November, special grants and loans were made available towards the cost of repairing farm buildings damaged by the autumn storms. These special facilities have been of considerable utility to those who were hard-hit at that time.
Deputies have, during the past six months or so, been supplied with several detailed memoranda prepared by my Department on the subject of agriculture in the Common Market. This subject is also dealt with in the White Paper which was presented to the Oireachtas very recently. The position of agriculture in the Common Market is under continuous study in my Department, in consultation with farming and trade organisations, and, during the past year, one of our officers was transferred to the Brussels Embassy to keep us directly informed of all developments and, in general, to look after our agricultural interests in the context of the Common Market. It is also my intention to arrange for a survey of consumer food requirements in the principal Common Market countries by an export firm of market consultants.
The procedures for developing a common market in agriculture are far more complex than those for industry, as is indicated by the rather slow and painful evolution of a common system among the present members of the European Economic Community. We hear all kinds of pronouncements from time to time about how our agriculture will fare in the Common Market, but many of these pronouncements do not seem to be backed up by a serious study of the matter.
The agricultural advantages which membership of the Common Market will entail, as well as any possible problems, can become fully clear only by a process of continuous study of the decisions taken in Brussels, according as they become available. I have said before—but I cannot repeat it too often—that the real advantage of the Common Market will be that all farmers in Western Europe should have equal opportunities of fair competition under reasonable market conditions when the common agricultural policy is fully established. The benefit to be derived by any individual farmer will, therefore, depend mainly on how good a farmer he is and not on how much money any individual Government are paying out to him. A self-reliant and progressive attitude by farmers will, therefore, be extremely important in the future, and I believe that, in this direction, the voluntary agricultural organisations have a very important part to play and a very serious responsibility to carry. In the Common Market, it will be no use blaming the Government for everything that goes wrong, because there will be a common system throughout the area, and this system will be the result of decisions taken, not by one Government but by many Governments.
I believe that the fullest possible utilisation of the many aids to agricultural productivity which the Government are now making available should be one of the main objectives of the voluntary agricultural organisations. That the Government are encouraging and supporting these organisations is shown by the fact that in the five years to 31st March, 1963 a sum of over £160,000 will have been paid out to such bodies as the IAOS, the NFA, Macra na Feirme, Macra na Tuaithe, the Irish Countrywomen's Association, the Irish Creamery Milk Suppliers' Association and other bodies. These grants have been made available for a variety of purposes, such as the training of personnel, the defraying of expenses incurred in sending representatives to conferences abroad, the hiring of experts from outside the country, the purchase of building and equipment, and, in one case, the undertaking of a management survey of the organisation in question.
As the House will remember, last year in connection with the Freedom from Hunger Campaign of the Food and Agriculture Organisation of the United Nations, I mentioned that the Irish Red Cross Society had kindly agreed to organise a public national collection in 1962 in aid of the campaign. The society's fund raising programme is in progress and, as the House is aware, it has been decided that the Irish national collection will be used, through the Food and Agriculture Organisation, to assist in the agricultural development of Tanganyika, probably by sending trained advisers from this country to collaborate with the advisory and educational services there. The Freedom from Hunger Campaign is a most laudable project deserving of the fullest support from our people, who whatever their difficulties, enjoy a standard of living incomparably greater than that of the majority of the world's population who are located in the under-developed countries.
I should also mention that another important programme to assist the under-developed countries has recently been launched. It is called the World Food Programme and it will be operated jointly by FAO and the United Nations. It will be initially an experimental scheme, lasting for three years, to utilise food surpluses to aid the under-developed countries. The programme will be operated with the aid of voluntary contributions from Governments aiming at a total resource of $100 million in commodities, services and cash to be pledged by participating governments at a Conference to be held later this year. I feel that there is a moral obligation on this country to contribute to this programme and I expect to be making proposals to this end in the Dáil later in the year.
The purpose of the Supplementary Estimate is twofold. First of all, it provides the money, amounting to £1 million to enable the price of creamery milk to be increased by 1d. a gallon from 1st June, 1962. I have already dealt with this matter in the course of this speech.
The second item in the Supplementary Estimate is a payment of £75,000 to the Pigs and Bacon Commission for the purpose of developing export markets, which amount is being counterbalanced by an increase of the same amount in Appropriations-in-Aid through a recoupment from the Marketing of Agricultural Produce Account. This procedure is necessitated by the fact that, because of a provision in the Pigs and Bacon Acts, a grant made direct from that Account to the Commission could only be paid into the Commission's Stabilisation Fund and used only to meet losses incurred on exports of bacon.
In the White Paper on the Export Marketing of Agricultural Produce, it was indicated that the Government's policy was that the Marketing of Agricultural Produce Account should be used for such purposes as market surveys and sales promotion in respect of dairy produce, pigmeat and some other agricultural products. It was also decided that the bulk of the funds in the Account should not be committed until after the establishment of An Bord Bainne and the reorganised Pigs and Bacon Commission. A grant of £100,000 from the account has already been made to An Bord Bainne, and it is desired to make this grant of £75,000 also to the Pigs and Bacon Commission.