The alternative to the kind of protests which have been building up in the Community since 1980 is a straight-forward reduction in prices of somewhere in the region of 10 per cent. In my view that would be far more damaging to our country and to our farmers than any of the schemes which have been talked about since.
There is a much wider dimension to the problem we are talking about. Before I go on to that, I want to refer to some of the cases mentioned here last night during the course of the debate. Last night Deputy Wilson talked about a particular farmer who has been developing his farm over a period of years and expanding his output. We all want to see a continuation of that. We all want to see people making progress to the limit of what is possible.
I am quite confident that we will get to our objective, but the situation we are facing is one that allows flexibility for the kind of producer Deputy Wilson talked about here last night. In very broad terms, in our dairy sector one-third of our producers are expanding, one-third are staying static and one-third are declining. When we add on to that the kind of headroom for which we are negotiating, we see that within the system there is quite a deal of leeway for those who want to expand and who can expand to continue to expand, particularly if we engineer the overall quantities at creamery level rather than at farm level. That is a factor to which Deputy Wilson did not refer last night because it did not suit the kind of case he wanted to make. It is a factor which is real and offers a margin of leeway to the kind of producer he was talking about.
I want to refer to some of the wider aspects of the negotiation which is going on. We spent quite a deal of time in the latter part of last year following a particular formula for these discussions which, in retrospect, does not seem to have worked all that well. We followed this formula of having special Council meetings where Ministers for Foreign Affairs, Agriculture and Finance of all the member states got together and thrashed out all the issues.
The first point we were determined to establish during those discussions was the fact that there is a link between all of the different aspects of the overall problems which are now on the table. There are four main problems facing us at the moment. We have the agricultural problem which is wider than the dairy sector. Our main concern is with the dairy sector. There is the problem which has come to be described as the problem of budgetary imbalances or the UK problem. There is a problem of overall budgetary discipline in the Community.
Lastly, and in my view one of the most important of the four, there is the whole problem of the level of resources available to the Community to finance the agricultural policy, the regional policy, the social policy and all the other areas. We would like to see the Community in a position to make a greater contribution to the basic aim of redistributing economic activity throughout the member states and favouring the less well off.
We have been very careful to keep on making the point that these four problems are interlinked and that there can be no question of agreement on any one part of the overall package without the overall package itself being acceptable. That is an important point which tends to get lost in a concentrated discussion of the kind we are having here on a particular part of the problem.
In my view it would make no sense at all for us to pursue single-mindedly any one aspect of the problem, whether it was the dairy sector or the budgetary imbalance or any one of them. We need overall agreement on the level of total resources to be made available to the Community. In this country and right through the Community we have seen the effects of the fact that the Community have about reached the limit of the resources available to them. Of course that is an area in which probably we would be a great deal more sensitive than some other member states because we see, perhaps more clearly than do they, the extra contribution that a financially stronger Community can make to the development of a country like ours. We need agreement on that. We have the trade-offs that we ourselves make between different pieces of the package. Of course, in a negotiation, the other partners have trade-offs they make between the different pieces of the package. I am sure it will not take any great stretch of the imagination for Deputies opposite to see that there are some other member states, for example, who would say that they will not agree to an increase in the total level of the Community's resources without getting what they would regard as a satisfactory solution on the agricultural side, to give just one example of the kinds of trade-off they make.
We have a general reserve on all of these points because we do not accept that different pieces of this overall problem should be split up and settled one by one. We have been quite deliberate in our assertion that the four must go together, that no one can be finally accepted as being solved until we have a satisfactory solution to all of them. In this kind of negotiation that is by far the best way for us to ensure that we protect our overall interests. That is the way we can best ensure that we protect our agricultural interests. It is also the way in which we can best ensure that we protect the interests we have in further developing the Community's regional policy, in ensuring that the Community's social policy continues to support the kinds of activities from which we draw substantial amounts of money through the Social Fund and from which we want to continue to draw substantial amounts.
It would do a great deal for the clarity of a debate of this kind if members of the Opposition would really sit back a little and not spend quite so much time restating the case we have been making for months in relation to agriculture but rather look at the wider problem in perspective. For example, what will happen in the Community if we do not reach agreement that the total amount of resources available to the Community should be increased? Equally what will happen if we do not get agreement to raise the VAT ceiling? We could have any agreement we like on agriculture, on the dairying sector, on the Social Fund, on the Regional Fund, but after a while we would discover it was not worth the paper on which it was written because we would not have the funds to support the policy on which we had agreed whether that was agriculture, the Regional Fund or anything else. I can assure the House that I would have no interest whatsoever in having a good paper agreement on agriculture, or any one of those other areas if I was not sure that that was backed up by the level of funding required at Community level. I have no desire whatsoever, for example, to have the kinds of regional policy prescriptions that I believe the Community should have unless I could also be sure that the money would be there to fund that policy at a level that would really make some impact on the Community, particularly at a level that would have a considerable impact on us.
This year we have already seen the difficulties that have arisen in the agricultural sector as a result of the fact that the Community is near its financial ceiling. There is no doubt that has created problems. Equally there is no doubt that if we do not reach an agreement that allows us continue to fund the Community properly those difficulties will become more and more pressing, more and more inconvenient for us as time goes on. It seems to me that that perspective has been totally missed by the Opposition in this debate.
The other parts of the problem perhaps are ones we do not really need to discuss here in such great detail although, as I said, it is a pity the Opposition have not shown somewhat more sensitivity to them. I do not believe it would do any of us in this House any good to conduct our negotiations on these various points in public. We are in the process of a very difficult negotiation, at a very difficult stage at present. Certainly I do not intend to add to the difficulties facing the Taoiseach, Minister for Agriculture or Minister for Foreign Affairs by venturing into details of what is on the table at present in a debate of this kind. But it is fairly clear from what I have said, and indeed from what the Minister for Agriculture said last evening, that throughout this discussion with our Community partners we have been very concerned, to ensure that our position was recognised, understood and appreciated by our partners in the European Community.
It is not at all an exaggeration to say that our partners in the Community know how important we believe our case in the dairying sector is to us. Equally there is no doubt that, throughout the process of negotiations, they have come to realise more and more what are the sticking points. They have come to realise more and more the reasons lying behind the negotiating stance we have adopted. They have come to appreciate — and it did not take them long to do so in the way the negotiations were conducted — that we are quite serious in our intent. They have also — and this is particularly important — fully realised the fact that we are quite serious in our intent to be involved in these negotiations in a way that will ensure the future well-being of the Community finances, and they know why. They are perfectly convinced of the fact that, while we are arguing from a position of an extremely strong, fundamental national interest on agricultural policy, on regional policy particularly, we are at the same time arguing from a position in which we take account of the fact that it is good for the Community as a whole to be able to resolve these problems and fund itself at a level we think appropriate.
In the last ten days our partners in the Community have come to recognise the fact that we have been making a case based on one of the fundamental principles of the Community, that is that all of the member states have to show a degree of solidarity amongst themselves and towards one another that properly reflects the spirit and letter of the Treaty of Rome. They have come to that realisation particularly in the last ten days as a result of the action the Taoiseach took, just what position he had to take and what were the motives that led our Taoiseach, on that occasion, to leave a meeting in the way he felt obliged to do. In no small measure that has been a factor which has kept the other member states in a position in which they could continue to negotiate with us because they realised that one cannot run a Community on the basis that one ignores the interests of any one of its member states. That is something every member state must recognise in the course of a discussion like this. We have recognised that throughout.
In putting forward our case it has been part of our concern to make sure that we did so in a way that afforded other member states maximum reasons for accepting the case we put forward. We have been very careful to argue our case not simply on the basis of the effects that different measures proposed would have on us, on the dairying sector and other parts of our economy, but also on the basis of the effects they would have on the overall Community. I am disappointed that the Opposition did not see fit to put this debate in anything like its proper context. I am surprised that they have overlooked the one central point in relation to the dairy industry which is that this negotiation has come about partly as a result of the acceptance from 1980 onwards that there would be limitations on the overall level of milk production at Community level. Deputy Byrne may not have understood it at the time but that is what happened.