I thank the Chair for allowing me to raise this matter on the Adjournment. With the permission of the Chair I should like to share my time with Deputy Noonan.
I raise this matter on the Adjournment because of the recent trend in the dairy industry of flouting the Dairy Produce Act, 1924, and in particular in respect of section 32. That section states as follows:
(1) The Minister may by order make regulations for all or any of the following purposes, that is to say:
(a) requiring that the calculation of the price to be paid for all milk and cream supplied to any premises to which the regulations apply shall be made on the basis of the percentage of butter-fat or other prescribed constituent contained in the milk or cream.
Adherence to that section is nothing more or less than what I am demanding. I regard the trend of payment on a flat rate basis as a retrograde step because it pays no attention to the content of solids in the milk which, at the end of the day, is the only portion of the milk that matters.
The present situation has no regard for the improvement of breeding programmes or the management of dairy herds. There is no incentive for the farmer to improve his breed or to feed cattle at a higher level of intake. It is most inappropriate now to allow this flat rate system to continue because of the constraints of the super-levy.
We have been hearing about the problems of the super-levy for the past 12 months and tonight the Minister is trying to recover some lost ground in Brussels. With the constraints of the super-levy and the threshold beyond which we cannot go it would be appropriate to avail of the increase we are allowed on the constituents of milk. We are allowed an annual increase of 0.06 per cent in butter-fat and an unlimited increase in protein. If there is a constraint on volume, why not go for an increase in constituents? However, the Department say they are not interested in the solids content of milk, that they are not interested in enforcing the Act. Illegal practices are allowed to occur, namely, payment by volume. When a farmer takes the white liquid to the creamery or to the co-op he will be paid the same price as the farmer who takes the same volume of milk but containing a much higher fat and a higher protein percentage.
It is appropriate that the Minister of State should be present in the House tonight because he has promoted the testing and recording of milk at farmer level through the milk records co-op. Now, an increasing number of the more efficient farmers are getting a print-out not alone of the yield and volume of milk but also of the fat, protein and solids. One section of the Department are encouraging farmers to produce milk with a high solids content and it is incomprehensible to find another section of the Department allowing the co-operatives to pay for milk on a flat rate basis, taking no account of solids.
The flat rate price is unfair to the farmer who is working hard to improve his dairy herd and the constituents in the milk he is supplying. It is also unfair to the processors. They are told every day they should diversify from traditional products and get into the higher revenue, more sophisticated products. Products such as cream liqueurs have been trotted out as an example of the way the industry should go. How can the industry go in that direction if the Department who are responsible for implementing the regulations are allowing those regulations to be flouted in regard to the payment for milk? Surely it is in the interests of processing plants and co-operatives to get milk that contains the highest possible levels of fat, protein and lactose. I am asking not only for this section of the Act to be implemented but I am also asking the Minister to make an order or a regulation extending the payments system to protein or lactose so that the entire solids in milk will be covered.
No doubt the excuse will be given that a review body in the Department are looking into the matter and that the whole question is being considered. Those old excuses are no good. It is about time we gave up considering matters and having review bodies. All those excuses have run out. We are in the EC. We are competing with countries such as The Netherlands and Denmark who are showing us the way. They are paying their farmers 104 per cent of the target price for milk but, on the other hand, we are paying on average only 85 per cent to our farmers. The major reason for our small price to the farming community is the low butter-fat, protein and lactose content in milk.
In the price negotiations in recent years the level of protein is weighted as more important than butter-fat. We have here an opportunity to increase the incomes of farmers by availing of the increases allowed on butter-fat and protein, thus allowing them to compete with the other dairying industries in the Community. I am calling on the Minister to enforce the Act and, as a matter of urgency, he should extend the section to cover payment in respect of protein and lactose.