Deputy Noonan (Limerick West) has been given permission to raise on the Adjournment the subject matter of Questions Nos. 31, 32 and 33 of last Thursday.
Adjournment Debate. - National Cattle Herd.
(Limerick West): I would like to thank you for giving me permission to raise on the Adjournment the sub-questions on the Adjournment. I propose to speak for ten minutes and two of my colleagues will speak for five minutes each. In view of the unsatisfactory reply of the Minister to those questions last Thursday afternoon this side of the House felt that those matters should be raised on the Adjournment because many of my colleagues had a number of supplementary questions to ask on them.
It is important from the point of view of the national cattle herd and also from the point of view of slaughterings at our meat plants that this aspect is aired in this debate this evening. This side of the House feel that cattle and beef production is the most important agricultural enterprise in the country. It is also the least developed and possibly the most under-capitalised. Our beef and cattle industry has, traditionally, been run on a more extensive rather than an intensive scale, with fluctuating and low profits. It is also characterised by different stages of production. Calf rearing, summer store grazing and beef production are distinctive and certainly are not integrated in one form. The major difficulty has often been that good profits from one sector have been at the expense of another.
The recent trend of encouraging calf to beef production is sensible and should be encouraged. I believe it will ultimately lead to greater stability in the trade. It is important that the crucial role of the cattle industry in our economy be recognised. In 1982 our total output was valued at about £655 million. It is quite feasible to increase this output by 20 per cent in volume alone within a relatively short period. This would result in increased earnings of over £130 million. Questions were put to the Minister and his views and those of the Department were sought about the approach of the Minister and the Government to increasing the national cattle herd.
I feel that an increase in our cattle herd must be a first priority. The withdrawal of the farm modernisation grants scheme will certainly hinder that increase. It is a step in the wrong direction. I feel such expansion would have enormous benefits for the whole country. The effect on the balance of payments would be dramatic. Unlike many other industries the means and the technology to secure this expansion are readily available. The drive to get this increase in numbers must be pursued simultaneously on several fronts. Beef cow numbers, which are very responsive to the prevailing economic climate have fallen by nearly 50 per cent over the past seven years and, unfortunately, they are still falling.
It must be recognised that farmers need to plan well ahead before embarking on such an enterprise. This is where we need Government planning over a period of four to five years. While you can wind down cattle production almost overnight it takes many years to build up the cattle herd. It is incumbent on the Government to provide guaranteed support for at least five years in grants and capital at reasonable interest rates. From what we have heard from the Minister today in reply to a number of questions we put to him, I feel this is not forthcoming. No area is more deserving of some form of subsidy and nowhere else would the return to the economy be greater than in this field. The provision of medium to long-term capital at subsidised rates is essential because of the present recession and the high interest rates prevailing. It would be unrealistic, with the recent decline in farm incomes, to expect many farmers to set up or expand suckler herds under those terms.
The formation of producer groups should be encouraged and positive incentives, possibly in the form of higher grants and subsidised interest, should be made available to such groups. They have been very successful in other EEC countries. Special Community aid is available for their formation. While this side of the House can justificably criticise the approach of the Government and the Minister with regard to agricultural production, nevertheless I feel there is an obligation on us, while we are in Opposition temporarily, to run the Department of Agriculture and agriculture generally from the Opposition benches. We intend to do this.
We will also put up positive, constructive alternatives because I feel there is little point in criticising without putting up constructive alternatives. We hope this is what we are doing here this evening. The disruption caused by the disease eradication programme is well documented. We must make every effort to free the country finally of tuberculosis and brucellosis whilst continuously monitoring the implementation of the schemes, thereby ensuring the minimum amount of hardship on farmers. Therefore, increased production in this area is important.
We have advanced alternative suggestions to the Minister and we hope he and his Department will take heed of what we have said on this side of the House because it constitutes positive alternatives. Also, in order to encourage an increase in our beef and cattle numbers attention must be given to the provision of winter fodder; at present too much of our winter fodder is made from hay rather than silage. I would ask the Minister to make grants available in a positive approach to the making of silage. All of this will help increase cattle numbers, so essential and of such enormous benefit to the country generally. I hope the Minister will have some positive suggestions to make.
Like Deputy Noonan I am grateful to be given this opportunity of raising this issue here this evening. Indeed the reason this question is being raised now is that we were unsuccessful last week in gleaning information from the Minister on his proposals to increase the national herd. Two Parliamentary Questions, Nos. 31 and 32 were put down on 2 June 1983 asking the Minister the proposals he had to increase the national herd. In my opinion the answer given was pathetic and did not constitute an answer at all. Subsequent supplementary questions were treated with contempt and sarcasm. This would appear to be a true indication of the Minister's interest in increasing the national herd. I might quote part of the Minister's reply which read:
A range of measures is already in operation to encourage farmers to expand livestock numbers.
— a range of measures introduced by the Fianna Fáil Party and reluctantly continued by the Minister. He did not spell out any of his own proposals because he has none. Then the Minister continued in his reply to say:
I am glad to note that slaughterings at our meat export premises to date this year are 8 per cent higher than the corresponding period last year and I hope that this upward trend will continue.
At this stage we want more than hope. That is why I say that the Minister's answer then and indeed his answers today are an indication of his interest in the whole business of agriculture.
The national herd commenced its fall in 1974 when factories paid a ridiculously low price for cattle, when the export of cattle was at an all-time low. We are aware of instances of farmers going to the mart with one calf to sell and sometimes returning to their trailer to find two calves in it, the situation then was so bad and such were the prices being paid. That was followed soon afterwards by the vets strike, one from which the country has not yet recovered. That strike was protracted with gross neglect by the then Government of the seriousness of the matter. That undoubtedly reduced our herd size because of the increase in the incidence of disease. The fall in cattle numbers continued but Fianna Fáil introduced measures to curtail that slide and had a scheme prepared, just before the last election, under which £100 million would have been made available for the purpose of increasing the cattle herd. This Government ignored that scheme totally. As admitted in the Minister's reply, the Government themselves have no initiative to offer. They have discontinued the farm modernisation scheme which undoubtedly acted as a discouragement to an increase in cattle numbers. As I have already said, this Government have reluctantly continued some other Fianna Fáil schemes.
I would pose the question: is agriculture still our greatest natural resource? It is very difficult to believe that that view is shared by the Government. Any Government must tap that great resource. This can be done only by increasing livestock numbers and possibly, to a lesser degree, tillage acreage. Both must be good for our economy. It must be remembered that ours is the best land in Europe, the best for grazing in Europe, we having nine months' growth as opposed to five months in some European countries and as little as three months in others. We must take full advantage of that fact but we have not; in fact we are going in the opposite direction.
Does the Minister recognise the importance of an increase in livestock numbers? I am appealing to him to provide an incentive to farmers to increase their cattle numbers immediately because increased productivity means extra jobs at marts, meat factories and creameries.
Mr. Leonard
The Minister, replying to my Parliamentary Question No. 33 of 2 June last asking the action he proposed to take to have a greater volume of slaughtering at our meat plants, indicated that to date this year we had had an 8 per cent increase over the corresponding period last year. However, it would appear he did not tell the full story because he had not taken into account the weather we have been having, when people were disposing of stock they would not dispose of at other times, because of slow growth, persistent rainfall and scarcity of feed. In my constituency, where there are two meat plants, one was closed a year ago, the second has been closed for the past six months and is unlikely to open for another two months. There is a plant owner in an adjoining county contemplating moving across the border for slaughterings because of the excessive costs involved on labour, energy, telecommunications and interest charges. Indeed a month ago here when we had a debate on unemployment there were meat factory workers demonstrating outside this building, distributing leaflets claiming that 750 people had been laid off and another 150 placed on a two-day week in County Kildare in three plants in that county, in Leixlip, Premier Meats, and Kildare Chilling Company which they claimed had a capacity to kill 30 per cent of all cattle for disposal. It is difficult to reconcile that claim with the Minister's contention that we have had an 8 per cent increase in slaughterings at our meat export premises to date this year. We condemn the Minister for not removing the anomaly which has left Britain in recent months in a favourable position in operating the variable slaughtering premiums in respect of their exports to other areas.
The situation in regard to the national herd is that it is now lower than when we joined the EEC. We must remember that at that time expectations were high as to how we would develop. In fact there was even talk of increasing the herd from something less than 7 million to 10 million over a ten-year period. That was the prediction at that time. We had a cattle herd of 5,783,100 in December last, which was lower than it was in June last. Of course I am not disputing the peak and valley periods. However, I think the Minister would agree that the increase has been minimal. He must accept there has been a substantial decrease in in-calf heifers. While there has been an increase in cow numbers, it is the increase in the numbers of in-calf heifers that is the important factor in the increase in stock generally.
The current difficulties of the meat trade are due primarily to the exceptionally high level of slaughterings in 1980 coupled with substantial exports of live cattle, both legal and illegal. A record factory kill in 1980 took place at the expense of a drastic reduction in the breeding herd. We all know that happened. The national herd goes in cycles. There are the peaks and the valleys. The year 1980 was a particularly bad valley period because of the number of slaughterings that took place. We are still trying to make up the decline that occurred in the national herd as a result of the number of slaughterings in 1980.
Indications are that there was a gradual shift away from live exports in favour of meat plants in 1982. Cattle slaughterings at meat export plants increased by more than 6 per cent on their admittedly low 1981 volume. As I said last Thursday, in the first few months of the current year there was an 8 per cent increase over the corresponding period last year. The levels in 1981 and 1982 were relatively low and I agree with Deputy Leonard in that. I am not trying to make a case for something that occured in the period of office of another Government. The national herd numbers rise and fall in cycles. Fortunately we are coming out of the downward swing.
In 1982 slaughterings accounted for 73 per cent of total export disposals compared with 68 per cent in 1981. The outlook for 1983 suggests a continuation of this trend and, consequently, an increased share of available supplies is likely to be sold to meat export plants.
With regard to legal exports, a prohibition is not permissible under EEC rules and would not be in the long-term national interest. It would reduce competition for cattle supplies and by weakening prices would affect the returns to producers. As a result it would affect production in future years.
Exports of live cattle to non-EEC countries have increased dramatically in the past few years, mainly to north Africa. The increase in live exports to north Africa coincided with a sharp decrease in the traditional live exports to Britain and member states of the EEC. The overall level of live exports in 1982 was the lowest for over 30 years with the exception of 1979. In that year we exported a large number of cattle to Britain but this is not the case nowadays. Live exports in 1982 were 125,000 head lower than in 1980 and 62,000 head lower than in 1981.
The live export to north Africa is a development of recent years. Such exports are possible because of the EEC system of export refunds which are designed to bridge the gap between high EEC prices and low world market prices. These refunds apply to both cattle and beef exported to third countries.
With regard to the cattle supply outlook, recovery in disposals will be gradual. I have heard the word "immediate" used here tonight. There cannot be an immediate increase: the increase will only be gradual. We will not get dramatic results overnight. The main problem is low cattle numbers and the main concern of the Government is to improve that situation.
The calf premium and calved heifer schemes are two of the special measures that have been introduced with a view to increasing cattle numbers. The reduction last year in EEC export refunds both for live heifers and heifer beef is an additional incentive in this regard. As in any expansionary phase of the cattle cycle, some of the extra numbers are retained for stock accumulation rather than sales for slaughter or live export.
Total cattle numbers declined from 7.18 million in June 1979 to 6.93 million in June 1980 and 6.7 million in June 1981. In June 1982 total numbers were again 6.7 million. Over the period 1979 to 1981 the national cow herd fell from 2.11 million in 1979 to 2.03 million in 1980 and 1.98 million in 1981. However, in June 1982 this trend was reversed and the national cow herd recovered to 2.02 million, an increase of 37,000 over June 1981. Cow numbers were again up last December, this time by over 53,000 and total numbers were up by 25,000. I think it is fair to say that the underlying decline in numbers has been arrested.
Finally, I should like to take this opportunity to announce the continuation in 1983 of the calved heifer scheme which the Minister for Finance, Deputy Dukes, launched in February 1982 when he was Minister for Agriculture. This is worth £70 for each additional calved heifer. This is in contradiction of what Deputy Byrne stated——
To every farmer?
I did not interrupt any of the three Opposition speakers.
I am trying to get some information.
If the Deputy kept quiet he might pick up information a little better. I have been accused of bad manners but the antics and the behaviour of some of the people on the Opposition benches has been disgraceful in recent days.
The Minister can leave that to the Chair.
This year's scheme for which application forms will be available shortly in local offices provides for payment of a grant of £70 on additional heifers calving down in 1983 and is open to all applicants regardless of whether they had borrowings or not. I hope that will shut up the Deputies opposite.
(Limerick West): That was always there.
With the continuation of this scheme very generous incentives are available to farmers to expand numbers. In fact, a farmer in the disadvantaged areas can receive grants of up to £169 for a cow and calf in a beef herd or £138 in a dairy herd. Elsewhere the comparable figures are £118 and £93.
I wish to repeat that the £100 million Euro-loan which has been referred to by Opposition Deputies would cost over a five-year period something in the region of £25 million. The previous Government, irrespective of what they may say here, did not make any provision for this money in the 1983 Book of Estimates which are there for anyone to examine. In our endeavours to get an improved national herd we provided £3 million in the current budget for increased prices for reactors. We also provided £3.26 million for AI services which were not provided for in the previous Book of Estimates. Those are positive incentives to increase the national herd. I should like if those points were borne in mind.
The Dáil adjourned at 11 p.m. until 10.30 a.m. on Thursday, 9 June 1983.