It is very nice to have the opportunity of introducing this very important Supplementary Estimate which is for an additional sum of £22.836 million which is offset by additional receipts of £5.1 million and savings on various subheads totalling £17.735 million. The net amount to be voted, therefore, is a token sum of £1,000.
The main items where additional expenditure arise are farm improvement programme, additional grant-in-aid for Teagasc, special premium on exports of beef to the United Kingdom and general disease control and eradication.
On the capital side, I am providing an extra £8 million under subhead L. 1. This subhead covers the various schemes aimed at encouraging on-farm investment as well as such measures as the young farmers installation premium and the western package. The £8 million is being provided to accelerate clearance of all the outstanding grants due under those schemes. As Deputies know, because of the limitations of the funds available there have been delays in the payment of those grants. Not only will all these arrears now be cleared but in future grants will be paid as they arise.
In seeking this extra £8 million from Government I was particularly conscious of the fact that capital works undertaken by farmers by way of new buildings and improvements are extremely valuable in creating employment in rural areas. Farmers continue to plough a good deal of their income into these kinds of activity and I am glad to say that the indications are that investment has been very bouyant this year. As well as reflecting the buoyancy of farm incomes generally, this situation is a clear expression of confidence by farmers in the future of the industry.
Much of the current farm investment is going into the provision of facilities for control of pollution from farm waste. This is a welcome trend in view of the incidents of river pollution and fish kills in the past. Not only did those incidents do serious damage to the rural environment but they also damaged our image abroad. That image of an open, pollution-free rural environment from which we produce pure, natural and wholesome food is one of the most powerful marketing tools we have for boosting sales of our farm products. Farmers themselves now recognise that fact and indeed it is a tribute to their sense of responsibility that incidents of river pollution were very few during 1988. It is clear that while the country benefits in many respects from the favourable green image we have throughout the world — for example in the areas of tourism and industrial investment — the main risk from any erosion of that image attaches to our food exports.
The very generous rates of grant now available in disadvantaged areas for animal housing and for provision of waste storage and anti-pollution facilities are a powerful incentive to farmers to make those investments. These high rates of grant became possible when I succeeded earlier this year in securing a 70 per cent rate of EC recoupment under the revised western package. Apart from enabling grants of 45 per cent to 55 per cent to be paid, that rate of recoupment was a significant breakthrough in the context of the increased structural funds that will be accruing to us. Incidentally, the package we have been negotiating for the last few days in Brussels will have further evidence of that rate of recoupment when it is concluded.
Turning to the main non-capital items, I am providing additional grant-aid of £8 million for Teagasc — the Agriculture and Food Development Authority. As Deputies will recall, the Government's objective in setting up Teagasc was to ensure that by combining our agricultural research, training and advisory services we would establish a strong single agency for the effective delivery of the support services vital to the agriculture and food sectors. The critical importance of these sectors was again underlined by the recent Teagasc report that agricultural output is set to exceed £3 billion this year, for the first time.
It will be recalled that I provided in the Teagasc legislation for priority to be given to the training of young farmers and to food research. In addition, I left the House in no doubt about the commercial orientation which the new Authority would be expected to have. Good intentions alone, of course, are not enough. I, therefore, appointed as members of the Authority a team of highly motivated people with excellent credentials. I took the view that only a high-calibre Authority could provide an efficient and cost-effective service relevant to the present and future needs of those sectors. I am particularly pleased by the manner in which the chairman and his colleagues have set about the task of welding the existing services into a dynamic organisation which will be geared to play a pivotal role in developing the Delors philosophy, involving the development of family farm units, the enhancement of rural society and the preservation of the environment. This will benefit not only the rural community but our economy as a whole.
With increased farm income and the development of new market outlets, the great challenge facing Teagasc is to build on the impetus created by these developments so that we can realise our aim of being a dominant force in world markets.
I expect to have the Authority's detailed proposals on the reorganisation of the services very shortly. I know — and have been impressed by — the members' willingness to explore all avenues in their efforts to meet the Government's objectives in establishing Teagasc. I have indicated many times in the House that the Authority would not lack essential funds and I am now happy to deliver on that commitment by providing an additional £8 million this year under subhead B. 4.
I should like to refer to the ESRI survey recently published which stated that 40 per cent of young entrants to farming had no educational qualifications and that a further 40 per cent had only group or intermediate certificates. This gives a false impression although I am not accusing the authors of intending to do so. The figures in the report relate to a period up to 1982 and the position has changed dramatically since then. The report is six years out of date and that should have been noted in the comments which following its publication. Of the 2,000 young people entering agriculture annually, about 90 per cent participate in comprehensive training programmes run by Teagasc and of those over 60 per cent have leaving certificates. A further 30 per cent have intermediate or group certificates, leaving under 10 per cent with no qualifications. I hope this will get at least as much publicity as the facts relating to 1980 or 1981 which caused so much concern and reaction.
Teagasc have a first-class vocational programme for young farmers, principally the three year certificate in farming course. The introduction of this course — and the fruit it has so obviously borne in the meantime — is one of ACOT's finest achievements. I have every confidence that Teagasc will prove equally innovative in the services it will provide to agriculture.
The £3 million provided for under subhead L. 7 is necessary to enable payment of that amount in variable premium on beef exports to the United Kingdom.
Irish exports of cattle and beef to the United Kingdom qualify for benefit under the UK variable premium scheme. These payments are made directly by the UK authorities to my Department calculate the amounts payable to individual meat factories. It is now estimated that receipts from the UK authorities in 1988 will reach £16 million, an increase of £3 million on the original estimate. There are a number of reasons for this increase, the principal ones being a higher level of beef exports to the United Kingdom than was originally anticipated and a fall in the value of the Irish pound against sterling. The additional £3 million now being sought is balanced by corresponding higher receipts from the UK Government under subhead M. 25.
Under subhead C. 3, which relates to general disease control, it is necessary to make special provision for an extra sum of £2.2 million. This arises out of the very rigid policy which we in this country have followed down through the years in order to keep the country free of exotic animal diseases. Let me assure the House that we will continue to folow that very rigid policy because of our unique reputation in the area of animal health control. The kind of diseases I am talking about are, for example, foot and mouth disease, swine fever, Newcastle disease in poultry, and so on. These highly dangerous diseases are scheduled as class A diseases under the Diseases of Animals Act. They are exotic to this country and the fact that we are free of them gives us an exceptionally high health status for trade purposes. This status guarantees the access of our meat and dairy products to the most demanding — in terms of health standards — importing countries all over the world.
In order to maintain that status, we follow a policy of immediate compulsory slaughter of animals or birds whenever we get an outbreak of one of the scheduled diseases and in such cases full compensation is paid for the animals or birds slaughtered.
Avian influenza is a scheduled class A disease and, following the policy I have just outlined, when outbreaks of this disease were encountered in County Monaghan in 1983 and 1984 the flocks involved were duly slaughtered compulsorily. Since then the matter of compensation has been in dispute with the flock owners concerned. The dispute hinged round the precise value that should be placed on breeding stocks. The flock owners were dissatisfied with the level of compensation offered to them and decided to institute court proceedings for a very much higher sum. In the event, the matter was settled prior to the court proceedings and to the satisfaction of both parties. The sum being provided now represents the outcome of that settlement.
I should say that we have been very fortunate in that we suffer very few outbreaks of class A diseases and up to now we have managed to cope with them very effectively whenever they have occurred. Such outbreaks of disease as have occurred, like the one for which funds are being provided in this Estimate, have been quickly identified, contained and eliminated. The relatively small cost to the Exchequer in such cases is a small price to pay for preservation of our disease free status.
I would like to reiterate the importance of total co-operation from all sections of the community, particularly from people coming into the country at airports and other points of access. I was very conscious of this today. People may take these notices from my Department as matters of routine but they are not. They are very important notices meant to guarantee a very unique health status. We have enjoyed the co-operation of the public at large and the farming community, but it is vitally important that that co-operation continues, particularly over the Christmas period.
It must be said, however, that with the ever-increasing volume of movement between here and Europe — both of people and of goods — the risk of introducing disease is greater than ever. Simultaneously the size of production units is tending to increase and that has cost implications when it comes to compensation. We cannot, therefore, relax our customary vigilance at ports and elsewhere or fail to take every legitimate precaution to avoid introducing disease.
The additional provision of £700,000 under subhead K4. is required to meet payments due to the land bond fund in respect of land acquired by the Land Commission. These payments represent the difference between the cost of servicing the bonds and the total receipts from the use of the land and were underestimated in the 1988 Estimates.
I would like to draw special attention also to other items in the Supplementary Estimate. The first is the provision of £0.5 million to the Racing Board under subhead H. 3. This amount is being provided in 1988 as an incentive towards the refurbishment and improvement of racecourses throughout the country. The allocation is a tangible indication of the Government's support for the racing industry and of the extremely valuable role which racing plays in attracting and entertaining visitors to this country.
Most of the £0.5 million has been allocated to Fairyhouse racecourse which has now been brought up to a standard as a centre for national hunt racing that rivals the best known racing centres elsewhere. Smaller grants are being allocated to a number of smaller racecourses around the country to encourage them to carry out the improvements that will provide a more comfortable environment and better facilities for their patrons. By doing this, these smaller courses can build up better attendances of visitors and punters alike.
The other item is the provision of £55,000 under subhead H. 4 to the Equestrian Federation of Ireland towards the cost of sending a national showjumping team to the Olympic Games in Seoul. The House will recall that the Government intervened to guarantee this sum when it became apparent that there would be no prospect otherwise of having a team in Seoul. The Government considered that for Ireland — the country recognised worldwide as the home of good horses — not to have a team at the Olympics would be a very serious omission indeed. A number of the interests associated with the horse industry supported that view.
It has been said, of course, that our team did not do all that well in Seoul. That is a point of view but considering the rushed preparation and the non-availability of some good horses at the time, the team faced an enormous challenge. The important thing is that an Irish team was there. I believe lessons can be learned from this year's experience and that we have every opportunity to be much better geared for Barcelona in 1992.
The programme for the development of the non-thoroughbred horse industry which I introduced recently and which has been very well received all round will, I believe, provide a solid foundation for the longer term production of good horses.
Under subhead L. 10, a sum of £160,000 is being provided to meet expenditure in the current year on the Government's pilot programme for integrated rural development. This programme was launched last October in a number of specially selected areas and will operate for a trial period of two years. In the light of the experience we shall gain a decision will then be made as to whether the programme should be extended.
Special co-ordinators have been appointed in all but one of the pilot areas. Recruitment is under way to fill the outstanding post and a co-ordinator will be appointed to the remaining area — south Kerry — as soon as possible after Christmas. The task of these co-ordinators is to assist the local communities to draw up their own set of priorities and to facilitate them in bringing their plans to reality.
I must emphasise that the programme does not establish any new grant-giving agency. The objective is to encourage the community to make more effective use of the aids already available and the co-ordinators have been specially trained in this work.
The Government's approach to integrated rural development is fully in line with emerging EC policy and our thinking is remarkably similar to what the Commission themselves had to say in the paper on "The Future of Rural Society" which they published recently. Indeed, our initiative has attracted a lot of interest in Brussels and the Commission have indicated their willingness to make a contribution towards the cost of the programme. They will, of course, also learn from the experience we will gain in operating the pilot phase of the programme. And we ourselves will be in a favourable position to avail of the additional amounts soon to come on stream as a result of the new arrangements for the future operation of the EC's Structural Funds.
Under subhead E. I am providing £142,000 for residual payments under the consumer subsidy schemes for liquid milk and butter, which were terminated on 1 January 1987.
A sum of £79,000 is being provided under subhead G. for the winding up expenses of Bord na gCapall. This winding up operation is continuing and the amount sought is required to pay the board's proven creditors without further delay.
The Supplementary Estimate also takes account of additional receipts of £5.1 million under subhead M. for appropriations-in-aid. This is a net sum which also takes into account deficiencies in receipts under some headings. The main excesses arise in receipts from the EC in respect of intervention stocks losses and additional receipts under the exchange rate guarantee scheme. They also include offsetting additional receipts of £3 million already referred to in respect of the UK variable premium scheme, and additional EC receipts under the western drainage scheme of £917,000.
The main deficiencies arise in respect of receipts from the EC in respect of market intervention and disadvantaged area schemes. The drop in market intervention receipts is due primarily to lower stock levels than were originally anticipated. The reduction in receipts under the disadvantaged areas schemes is directly related to the level of 1987 payments under these schemes which reflected a drop in cattle numbers.
I can confidently commend this Supplementary Estimate to the House.
