I move:
That a sum not exceeding £114,361,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of December, 1976, for the salaries and expenses of the Office of the Minister for Agriculture and Fisheries, including certain services administered by that Office and for payment of certain subsidies and sundry grants-in-aid.
The sum of more than £114 million I am seeking is almost £24 million greater than the final provision for 1975 but includes over £25 million for consumer subsidies on butter and milk. The provision for these subsidies in the 1975 allocation was about £10 million.
After deduction of the consumer subsidies the net amount is £89 million, compared with over £80 million in 1975. The net provision for farm modernisation, including the schemes which the EEC scheme is superseding, is nearly £13.3 million. Over £6 million is included for lime and fertiliser subsidy as compared with an expenditure of £4.4 million last year.
The gross provision for headage payments is around £17.5 million compared with a provision of £16.5 million in 1975.
The net provision for bovine tuberculosis and brucellosis eradication is £17.8 million, about £7 million more than the 1975 figure.
Over £6 million is being provided for education and over £3.5 million for county committees of agriculture. The provision for research is over £6 million, the bulk of which is by way of grant to An Foras Talúntais.
The net provision for market support is about £2.7 million, virtually all of which relates to market intervention operations in respect of beef and dairy products.
Total pay and travelling expenses is estimated at £14.4 million in 1976 as against £13.1 million in 1975. Pay and travelling expenses associated with the former land project work are now shown with the main provisions in subheads A.1 and A.3.
Detailed notes on the main activities of my Department have been circulated to Deputies and will be of help to them in the debate on the Estimate.
At the outset, it is appropriate that I should outline recent developments in regard to the common agricultural policy of the EEC which is so important for farmers.
During the past year the common agricultural policy was comprehensively reviewed by the Council of Ministers, the European Parliament and the Economic and Social Committee. This review was carried out on the basis of a stocktaking done by the Commission at the request of the Council. It is desirable to recall the main conclusions of that review not only because of the adverse criticisms which one frequently hears about the common policy but also because these conclusions are an important background to subsequent decisions taken by the Council of Agricultural Ministers. The outcome of the review can be summed up briefly as follows:
Firstly the review endorsed the importance of the common agricultural policy and its vital role in the process of European integration.
Secondly the review noted that the policy had contributed positively in the achievement of increased agricultural incomes, relative stability of prices, security of supplies and increased trade within the Community in agricultural products.
Thirdly the persistence of imbalances in certain sectors of European agriculture was noted, particularly income disparities, regional imbalances and market imbalances for certain products especially dairy products, cereals, wine, beef and veal.
Finally the review noted the need for improving and simplifying the various mechanisms of the common agricultural policy as well as the difficulties posed for the policy by the lack of progress in other areas of European integration especially in the areas of economic, monetary and social policies.
It was against the foregoing background that deliberations of the Council of Ministers on the fixing of prices for 1976-77 took place in March last. In addition, the general economic background to the Council's deliberations was one of continued inflation in many member states, sharply rising costs of agricultural inputs and wages generally as well as serious monetary fluctuations especially for the pound and the lira on foreign exchange markets. The Council agreed to an average increase of about 8 per cent in Community support prices. In our case this was augmented by the alignment step towards the level of the Community common prices.
The Council's decisions on prices were linked to certain adjustments in the monetary compensatory amounts and representative rates for certain currencies. Thus I secured agreement for a 2 per cent devaluation of the representative rate of the Irish £—the green £—which resulted in a corresponding increase in the level of our support prices. These increases will contribute to a substantial improvement in Irish farmers' incomes this year.
In the beef and veal sector the basic intervention price was increased by about 14 per cent and in the case of milk, the increases in the intervention prices for butter and skim powder are equivalent to about 2.5p per gallon in March and a further 0.9p per gallon in mid-September. In view of the existence of surpluses—particularly skimmed milk powder—in the dairy products sector, the Council is to decide by 1st September on the introduction of a system of financial contributions by milk producers with a view to applying the system as from the beginning of the 1977-78 marketing year. In the cereals sector the target price of barley has been increased by 8.5 per cent and intervention price by 4.5 per cent. The Council also agreed on new pricing arrangements for wheat. A special intervention price for wheat of bread-making quality has been fixed and the the intervention price by 4.5 per cent. The Council also agreed on new pricing into line with prices of other feed grains. The basic price for pigmeat was increased by 8 per cent and the intervention price for sugar and the minimum price for beet were also increased by 8 per cent.
Currency fluctuations during the past year continued to affect adversely the operation of the common agricultural policy. As Deputies know, I have never been happy with the way in which the system of monetary compensatory amounts operates. It creates distortions of competition and obstructs trade, especially when the rate of MCA is high and persists over a long period. In order to reduce the level of Irish MCAs I obtained the agreement of the Council of Ministers to three devaluations of the green £ last year and, as I have mentioned already, to a further devaluation in March of this year. These changes had the cumulative effect of keeping Irish MCAs over 17 percentage points lower than they would otherwise be and of increasing the value of EEC support prices in Ireland by about 15 per cent. Unfortunately, however, the weakness of the £ on foreign exchange markets continues to create problems.
I now move on to the EEC programme for the reform of agricultural structures. The total provision for capital grants to farmers in 1976 comes to more than £13 million. This includes the residual payments still being made under the former farm buildings and land project schemes amounting together to £3.3 million and current payments under the farm modernisation scheme for which £10 million is provided. As Deputies are aware, it is the intention to wind up the former schemes on 30th September next. This will mean that from next year onwards all capital grants available to farmers will be payable under the modernisation scheme.
We are now in a position to look back on the working of the farm modernisation scheme over the last year-and-a-half. In taking stock at this time it is well to reflect both on the positive merits of the scheme as well as on whatever shortcomings it may have. At 30th April last, 52,000 farmers had applied to participate in the scheme. That in itself is an impressive number. Nearly all of these would already have had a visit from their agricultural adviser. This direct contact now established between farmer and adviser, particularly in the case of those farmers who had not made such contact before, must be of positive value. The great majority of the applicants—some 42,000 of them —had in addition, been given advice on the future planning of their farms, either through the preparation of detailed farm development plans in the case of development farmers or by way of more general advice on their investments in the case of other farmers.
In the present day when capital investment on farms tends to run to substantial sums, the value of careful planning of all developments is of particular importance. There is always a serious risk that substantial investments, for example, in costly buildings and installations will be seen as the immediate solution for increasing productivity on farms. In very many cases this can be a mistaken approach particularly if a reasonable degree of efficiency in the basic operation of the farm enterprise has not already been attained in such aspects as following a proper fertilising programme or in the provision of adequate feed supplies. Without attaining basic efficiency in these matters then substantial capital investment is liable to prove more an added burden than an easy answer to the problem of increasing profitability.
When capital investment becomes more costly than the return on that investment it becomes of paramount importance. If farm planning means anything, it means making sure beyond doubt that the pay-off from investments justifies the extra expenditure by the farmer. To-day when agriculture is a highly competitive business we cannot afford wasteful investment in the industry. One of the essential merits of the farm modernisation scheme is the special emphasis it puts on proper planned development; and I would expect to see both farmers and advisers looking more and more to this positive aspect of the scheme in future.
It is, of course, a fact that at present something less than 20 per cent of the applicants under the scheme have been classed as development farmers. I am quite satisfied that this figure does not at all represent the proportions of viable and potentially viable farmers in this country. I would therefore, like to see a much wider stratum of farmers qualifying for development status and, as I told the House some time ago, we have made proposals to the EEC Commission which in our view would help to bring this about. These proposals will be examined together with those from various other sources in the context of a review of the EEC directives which the Commission has recently initiated.
Even though we have not the number of development farmers we would like, I should emphasise again that the level of grants available to all farms is generous. Moreover, they are now calculated as flat percentages of costs and this system enables periodic adjustments to be made to take account of cost changes. I am concerned, however, to think that farmers, or indeed advisers, are totally grant-orientated or that grants should be seen as the prime motivation for expansion or development on the farm. The constant preoccupation with grants to the exclusion of any thought of more positive features of the scheme seems to suggest a tendency in this direction.
Now for the first time ever, the agricultural industry is, since our joining the EEC entirely market-orientated and in this situation the farmer's decision as to whether he will drain that extra area of land, increase his stock, change his milking system or otherwise intensify must, if it is to be soundly based, depend on the return he sees himself getting in the market place at the end of the day. When this becomes the prime motivation for the farmer's decision, rather than the amount of grant he might get from the State, then I am confident that the premium which it is necessary to place on efficiency of production and the need for an adequate return on the capital invested by the farmer will fall into their proper place.
It is now a fact that a significant number of farmers are keeping farm accounts under the aegis of the farm modernisation scheme. This is a very encouraging development from any point of view. However, the keeping of accounts is one thing—the use which the farmer makes of the accounts may well be another. All these accounts will be of little value unless they are seen and utilised by both farmer and adviser together as a useful tool to point up the deficiencies in the operation of the farm business where these arise and to provide the basis for improved efficiency wherever possible. Again, I sincerely hope that we have reached the day when a farmer thinking of keeping accounts will ask rather what use will the accounts be to him instead of what grant is he likely to get for keeping them.
The scheme of cattle and sheep headage payments operated in 1975 under the EEC disadvantaged areas directive will be continued this year. As Deputies are aware, the scheme aims at maintaining viability and preserving the environment in mountain and less favoured areas and is complementary to the policies operated by the Community for improving agricultural structures. Under the 1975 scheme the amount paid out to farmers in our severely handicapped areas was about £12 million of which 25 per cent will be recouped by the EEC. This year, fortunately, we were able to persuade the Community to increase the rate of recoupment in the case of Ireland and Italy to 35 per cent. The Government have decided that the benefit of this higher recoupment should be passed on in full to the farmer. Our intention is to increase the number of livestock units qualifying for the higher grant i.e. £16, to eight and to pay £10 on the balance up to 30 livestock units—maximum £348. Last year we paid £16 on the first five livestock units; £10 on the next ten and £8 on the next 15 giving a maximum of £300. As part of the disadvantaged areas scheme we will continue to pay grants on beef cows in the less disadvantaged areas. These grants will be aligned to the cattle headage grants in the severely handicapped areas and will be at the rate of £16 on the first eight cows and £10 on the next 22 giving a maximum of £348. Outside the disadvantaged area the grants—if we are to conform to EEC thinking—must be significantly lower than within the scheduled areas and we propose to pay £12 per cow on all eligible cows after the second and up to a maximum of £300.
Sheep grants in disadvantaged areas will also be increased with £1 extra on mountain hogget ewes, 50p extra on other types of hogget ewe and 50p extra on mountain lambs.
I must stress that these are our proposals which we will shortly be putting to the EEC Commission, but we must await their approval before taking them as definitive. We have, of course, kept in close touch with the Commission and have taken their views into account in working out the revised grant structure.
The directive also authorises the provision of certain additional investment aids in disadvantaged areas and of special assistance towards fodder production and the development of hill pastures farmed jointly. We will be introducing a scheme of this kind as soon as proposals which we have submitted to the Commission have been cleared.
Before I leave structural policy, there is another measure to which I should like to refer. This is the scheme of grants which are provided out of the guidance section of FEOGA for certain types of projects approved by the Commission and aimed at improving structural efficiency in agriculture and fisheries. Since 1973, grants amounting to £12.3 million have been allocated to Ireland under this scheme covering a broad spectrum of the agricultural sector including dairying, meat, fish, cereals and poultry. This assistance has made a most important contribution to the industry's development and progress and has been particularly beneficial to the food processing sector in helping it to modernise its existing plant and provide new facilities. For the current year's scheme, Irish applications lodged in Brussels involve grant-aid amounting to £11.5 million. These applications are being examined by the Commissions at present.
I would now like to refer to some of the more important commodity developments beginning with cattle and beef.
Our cattle industry has recovered well from the very serious marketing difficulties of 1974. Market prices have never been better and confidence has clearly returned to the industry. However, it is going to take time for this renewed confidence to be translated into renewed expansion in finished cattle numbers and we must accept that our exports of cattle in live or dead from over the next couple of years will be below the record disposals which we witnessed last year.
Prospects for our beef industry in the foreseeable future are good and I expect that our producers will not be slow to respond to this situation and to the very real advantages which full membership of the Community will bring to our beef trade a little more than a year from now. They have the continuing support of the beef intervention arrangements and—on the UK market—the variable premium, and there is every reason to look to the future with confidence and to be expansionist in outlook.
In 1975 a total of over 130,000 tons of beef was purchased by my Department as intervention agency. The handling of this quantity of beef, representing about half a million cattle, involved a huge amount of work and imposed considerable strain on the resources of my Department.
Despite the improved market conditions, substantial quantities of beef are still going into intervention— about 1,500 tons a week at present. Intervention is, of course, a vital safeguard for our producers and is particularly valuable in times of surplus. It should not, however, be regarded as a normal and regular outlet. In the long run we must sell our products on commercial markets and our whole approach must be directed to this.
I might also say that intervention operations have considerable financial implications for the Exchequer. The Estimate provided a net £2.6 million to meet incidental expenses. In addition, pending the sale of the products and the recoupment of losses by the Community we ourselves have to provide the necessary capital to finance intervention purchases. This can absorb very considerable resources. At times last year almost £120 million was tied up in intervention purchases of beef and skim milk powder.
It is sometimes suggested that I should stop exports in live cattle and calves, and that all of our cattle should be processed in our meat plants. From the point of view of added value and employment, I quite agree that as a general proposition it is desirable that as much as possible of our cattle should be processed before export. However, experience has shown that competition from the live export trade helps to maintain price levels for producers and it encourages the increased production which is so important to the factories. In any event, under Community rules I have no authority to restrict the export of live cattle and calves. We just cannot turn exports on and off as we wish. Indeed, we ourselves would be the first to complain if other member states were to do this on the imports side. I might also say that given the good outlook for beef, I see no good reason why our fatteners should not be able to compete effectively with foreign buyers for calves and young cattle.
I have made several appeals recently to farmers to make maximum use of AI. I was very glad to note that inseminations so far this year showed a rise of 17.5 per cent over the figures for the corresponding period last year with Friesian inseminations still accounting for around 50 per cent of the total. I hope that this welcome upsurge in AI usage will continue for the rest of the year.
Turning to milk, the production of creamery milk continues to be an extremely rewarding activity for farmers, with prices in 1976 expected to average approximately 35p per gallon. This price compares with an average of 30.5p last year, 23.8p in 1974 and 20p in 1973 and the effects of the improving price are clearly seen in the level of production of creamery milk which in 1975 reached an all-time high of 629 million gallons and seems likely to set a much higher record in the current year.
The heavy stocks of dairy products, particularly of skim milk powder, in intervention in the Community at present are somewhat disturbing but I must emphasise that since our entry into the Community we have not sold any butter at all to intervention. An Bord Bainne have successfully marketed our entire exportable quantity. It is likely that, later this year, we shall have to face up to proposals of a financial nature from the EEC Commission designed to help reduce these public stocks to a more tolerable level.
Rationalisation and diversification on the processing side of the dairying industry continue. In July last the Dairy Disposal Company's creamery properties in west Cork were transferred to co-operative ownership so the company are no longer involved in milk processing. There is still considerable scope for product diversification and for a reduction in our dependence on a small number of products. Some of our processing firms have been showing commendable initiative and enterprise in this respect and my Department have been supporting suitable projects for grant assistance from the IDA and, where appropriate, from EEC grant-aid through FEOGA.
The consumer subsidy for butter which was specially increased in July last to reduce living costs now stands at £307.29 per ton or almost 14p per lb. The consumer liquid milk subsidy of about 2p per pint which was introduced in August last also continues in operation. These subsidies will cost £9.4 million and £15.8 million respectively in 1976.
Sheep prices have been reasonably satisfactory in recent months and prices for early lamb were well up on those of a year ago. This relatively buoyant market situation has resulted from the development of fairly regular live shipments to the Continent and increasing exports of carcase lamb to North Africa rather than from the more usual export trade in carcase lamb to France. Indeed, the increased restrictions applied by France last year and about which I protested strongly at the time were the prime reason for the weaker market here last summer and autumn. In March this year the French import charges were increased yet again.
The remedy for this very unsatisfactory situation is, of course, a common policy for sheepmeat. I do not have to tell the House how strongly I have been pressing this issue in Brussels for some considerable time past. The most recent development has been that the Council of Ministers passed last month a resolution undertaking to adopt, before 1st August, interim measures to improve the conditions of intra-Community trade in the sheepmeat sector and asking the Commission to submit a report to serve as a basis for a Council debate on the broad outlines of definitive regulations for sheepmeat. I can only express the hope that after all the frustrations, particularly in the past year or so, some positive progress will now be made towards providing equitable treatment for sheep producers under a common Community policy.
Conditions in the pig industry improved throughout 1975 notwithstanding the general recession and the difficulties experienced by all sectors of the industry in 1974. Pig prices advanced substantially and the prices obtained for bacon and pork on export markets rose to new record levels. By December, 1975, the female breeding hard had recovered to 100,900 from 88,700 a year earlier and the numbers of pigs delivered to bacon factories so far this year are up by 10.8 per cent over the corresponding period in 1975. This increase in production is most welcome and the indications are that the upward trend will continue. A higher level of output is necessary for the more efficient utilisation of factory capacity and in order to restore the industry's contribution to farm income and to our balance of payments.
A substantial increase in production should be attainable reasonably quickly, taking into account existing pig-housing capacity, the grant aid available for pig production under the farm modernisation scheme and the more active part being taken by factories in promoting increased production of pigs for their plants. Prices of feeding stuffs for pigs have been increasing and may reduce producers' margins for a while but the lesson of the past two years is clear— that is, those who maintain efficient production units of economic size and who are prepared to accept temporary fluctuations in profitability can, in the long run, expect reasonable overall returns on their investment and are in the best position to benefit from the high margins when these occur.
In 1975 the estimated output of our poultry and eggs industry was valued at about £35 million. Eggs accounted for over £16.0 million, broilers and hens £12.3 million, turkeys £5 million and ducks and geese £1 million. In 1975 the poultry industry in Ireland and other member states did not show any recovery from the recession which began in 1974 due to increases in feed costs, reduced demand for poultry meat because of competition from other meat products and, in some instances, because of over-production and surplus stocks.
Broiler production, which is operated on a contract basis between growers and processing plants, declined slightly in 1975 but there was some increase in turkey production and duck production. In the case of ducks I should say that about 70 per cent of production was exported oven-ready. Egg production has remained fairly static in recent years. About 65 per cent is now produced in intensive commercial units and the output is entirely for the home market.
I now come to the subject of livestock disease. State funds to the extent of £17.8 million net are being provided in the current Estimate under the bovine tuberculosis and brucellosis eradication schemes. This is almost double the amount spent in any previous year. The funds provided would permit a full round of TB testing in all counties including for 1976 herds in the seven north-western counties which, for some years past, have been tested only biennially. Provision has been made for an increase in the fees payable to veterinary surgeons for work done under the schemes. I am also considering extending compulsory brucellosis eradication measures to County Dublin as the next step in the nation-wide drive against that disease.
In the absence of normal rounds of testing for over a year, my Department's efforts have been concentrated on testing reactor and problem herds, especially in areas with an unsatisfactory disease history. As a result, the total number of reactors taken up in 1975 was almost as high as the 1974 figure. In the southern half of the country, the pre-intensive brucellosis scheme continues to operate. Because of the active support of the major co-operative creamery societies, there has been an upsurge of interest in the scheme. I am confident that significant progress in reducing the incidence of brucellosis can be made in these counties in advance of the introduction of compulsory eradication measures.
There is now an urgent need to resume full-scale rounds of TB and brucellosis testing and it is a great source of disappointment to me that the latest settlement proposals which I made in a final effort to resolve the current dispute with the Irish Veterinary Union have not been accepted. I am not at all satisfied with the progress made to date in our efforts to combat TB and brucellosis and I can only stress once again that it is vital, if we are to maintain and expand our exports of livestock, meat and dairy products, that there must be a real commitment on the part of all concerned to intensify our efforts against these diseases. The funds being provided in the Estimate are a clear indication of the Government's concern and commitment in this regard.
Compliance with the Warble Fly Order, 1971, had the effect of reducing the incidence of warble infestation from 22 per cent in 1971 to 0.2 per cent in 1975. Although revocation of the order in 1975 made general autumn dressing no longer compulsory, the farming organisations with the help of the AI stations organised a voluntary dressing campaign last autumn for the twofold purpose of further reducing the number of animals likely to show warbles in the spring and dealing with lice. My Department gave every assistance to this voluntary campaign.
I would appeal to all herdowners to co-operate in the measures now being taken to eradicate the remaining pockets of warble infestation and to rid the national herd, once and for all, of this pest.
Under the Sheep Dipping Order, 1965, flock owners were required to dip their sheep twice each year—in the summer and in the autumn. It has now been decided that a single annual dipping, if carried out during the period between 1st October and 31st January when the mite which causes sheep scab is most active, should give more satisfactory results in eradicating the disease and the sheep dipping order has been amended accordingly.
In view of the alarming spread of rabies across the Continent of Europe and the consequent increased risk of the disease entering this country through the smuggling of dogs, cats or other mammals, my Department are giving intensified publicity to the serious threat from this dreaded disease. All our air and shipping companies particularly the car ferry service between Rosslare and Le Havre as well as harbour authorities, travel agents, home and continental yachting clubs and so forth have been alerted to the danger of illegal importations. These precautionary measures are being taken in collaboration with our Customs, Garda Síochána and portal authorities. New statutory measures which I have introduced replace our existing regulations and substitute a more comprehensive procedure for dealing with possible outbreaks of rabies here.
Turning to tillage, the 1975 cereals harvest was generally good and returns to producers were satisfactory. The area under cereals, at 850,000 acres approximately, was however far short of meeting our home requirements. I have been using every suitable occasion to advocate increased cereals production by our farmers and am encouraged by the indications that there will be an expansion this year. I hope that this increase will be maintained over the next few years to provide at least the 400,000 tonnes or so of grain which we import annually. The returns to cereals producers are good relative to other farming operations especially with the higher yielding varieties now available and so there is every incentive for farmers to produce more grain.
On sugar beef, I am glad to note that the upturn which commenced last year in the acreage under beet is being continued this year with an acreage of about 84,000 acres. This amply demonstrates the confidence of Irish beef growers in the profitability of the crop. During the year the EEC Council of Ministers agreed that we might import about 32,000 tons of raw cane sugar annually on the same terms as sugar imported by refiners in the UK. The refining of this sugar will provide welcome employment during the offpeak period at the Carlow factory.
Ex-farm prices for potatoes have been generally satisfactory in recent years and indeed prices for the 1975 crop rose to unprecedented levels in a situation of scarce supplies and high prices throughout Western Europe generally. Preliminary inquiries show there will be an increase in the potato acreage this season and assuming reasonable yields prices can accordingly be expected to be at more normal levels.
The specific provision for horticulture in the Estimate amounts to £195,000. The major part of this is to meet commitments under the old glass-house and mushroom grant schemes which have now been superseded by the farm modernisation scheme. There is also an allocation of £25,000 for aid to producers' organisations in the fresh fruit and vegetable sector. The horticulture industry had a reasonably satisfactory year in 1975. While there was a slight drop in acreage and the yield of certain crops was affected by drought, overall quality was good and favourable market conditions gave the growers a satisfactory return. Exports of fresh fruit and vegetables continued to increase, the main items being tomatoes at £2.1 million and mushrooms at£1.7 million.
As regards the lime transport and fertiliser subsidies, I am providing and additional £1.8 million for the phosphate subsidy. After the steep world wide increase in fertiliser prices over the past two years, present indications are that world fertiliser prices are levelling out or even falling. I would again appeal to our farmers not to exercise false economy by reducing unduly their purchase of fertilisers.
Because of the cut back over the past two years increased usage of fertilisers has now become an urgent necessity. Generally speaking our tillage crops receive adequate fertilisers but, if we are to make full use of the potential of our grassland, we must keep up and improve its fertility. This can only be done by adequate application of the proper fertiliser nutrients, including lime.
The grant-in-aid provided for An Foras Talúntais to meet general expenses in the current year is £5.6 million. A further £50,000 is provided by way of grant to An Foras for capital purposes.
The amount of the State grant to An Foras has increased very substantially in recent years. The non-capital provision for the current year compares with a grant of £1.28 million paid ten years ago or £2.4 million paid five years ago. The State's financial contribution to the development of the institute's research network since its foundation will, in fact, have exceeded £35 million by the end of the present year.
It is generally accepted that in the period since 1958, when it was set up, the Agricultural Institute have established a research organisation which compares very favourably with similar organisations in other countries. In that time the work of the institute has made a significant contribution to the development of the farming industry. I am pleased to say that farmers themselves recognise the value of the institute's work and that they have backed up that recognition with a willingness to contribute financially to particular aspects of the institute's activities. This is a development which I particularly welcome and, indeed, I would very much like to see all sectors of the farming industry following the example of the dairying industry and of those other sectors which are already contributing financially to the work of An Foras.
The Agricultural Institute will, of course, be incorporated into the proposed National Agricultural Advisory, Education and Research Authority. This must result in still closer liaison between the research workers and the advisory services and in a more rapid and more effective translation of the results of research activities to farmers through the advisory services.
The Estimate provides £3.5 million for county committees of agriculture and other substantial sums for agricultural education and training.
There is general agreement on the importance of ensuring that farmers have a good basic knowledge of the principles of agricultural science and how to apply them in their farming practice so as to obtain the best results for their expenditure of time, effort and money. Success depends on careful planning of the farm programme and on good farm management with ability and readiness to make use of improved techniques. Education and training are necessary to achieve these aims.
Committees of agriculture continue to provide in conjunction with my Department an agricultural advisory and education service to farmers and rural dwellers. The Government published last April a White Paper setting out their proposals on the establishment of a new National Agricultural Advisory, Education and Research Authority. Work is going ahead on the preparation of legislation to give effect to these proposals.
The effectiveness of the existing services has been improved in several ways. To date a total of 59 agricultural education centres are planned and already 25 of these are in operation throughout the country and a further seven are under construction; grant aid of up to £20,000 is paid by my Department for each approved centre.
Last November following consultation with the Agricultural Advisers' Organisation, I approved the creation of 70 posts of senior instructor. This is a new grade in the advisory service and the new posts will be filled from the existing advisory staff. The senior instructor's main job will be to supervise and co-ordinate the work of all the advisers in an advisory district and to help them plan their education and advisory programmes.
During 1975 a scheme of vocational training for people aged 18 years and over and engaged in farming was introduced by county committees to meet the requirements of EEC Directive 161. Under this scheme farmers and farm workers receive special training designed to improve their farming skills and to help them to adapt to modern agriculture.
Before concluding, I would like to refer to the overall performance of agriculture in 1975 and also the prospects for the current year. For farmers, 1975 was a good year with substantial increases in output and farm income. The value of gross output increased by 34 per cent from £634 million to £850 million. There were substantial increases in the value of most products including cattle, milk, sheep, wheat, barley, sugar beet and potatoes. The most significant feature was the remarkable level of sales of cattle, which provided a very large supply of raw material to our meat industry. The rise in the milk intake by creameries, to which I have already referred, was also very encouraging. At the same time, the fall in the national cattle herd was disquieting and the decline in the area under cereals must be reversed. With a substantial decline in the use of feed and fertilisers purchased by farmers in 1975 the volume of net output rose by 10 per cent. The growth in net output in 1975 has meant the total increase in net output over the past five years has been over 25 per cent—not a bad achievement for an industry which is sometimes accused of not being dynamic. The overall result for farmers' income was an increase estimated at about 50 per cent over 1974 and this has brought back confidence to the industry about its future growth.
As for 1976, present indications are that it, too, will be a good year for farmers. Although cattle disposals should revert to a more normal level, cattle prices will be appreciably higher than last year. Given favourable weather conditions, milk yields are forecast to increase and intake of creamery milk is already running at 16 per cent over last year, and in this way we expect a substantial increase. I know that the value of the agricultural industry in the economy as a whole is generally appreciated and that Members of this House will adopt the Vote I have just recommended.
