Dáil Éireann díospóireacht -
Thursday, 15 Dec 1988

Vol. 385 No. 8

Supplementary Estimates, 1988. - Vote 33: Agriculture and Food (Resumed).

Debate resumed on the following motion:

That a supplementary sum not exceeding £1,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of December, 1988, for the salaries and expenses of the Office of the Minister for Agriculture and Food, including certain services administered by that Office, and of the Irish Land Commission, and for payment of certain grants, subsidies and sundry grants-in-aid.

—(Minister for Agriculture and Food).

Mr. Kemmy

Before the adjournment I was saying that most Irish politicians have in the past adopted a low and critical attitude to the Common Agricultural Policy and to farmers in general. Rarely if ever outside this House is the Common Agricultural Policy criticised. This uncritical attitude has led to a lack of an agreed regional policy, dear food, large food surpluses that are expensive to store as Deputy Stagg commented, and, above all, lopsided agricultural development. This means Irish efforts are not concentrated on the development, regional or social funds or on the other important mechanisms and policies necessary for the country as a whole, but have concentrated on the Common Agricultural Policy which is a mistake and has resulted in many lost opportunities.

How many times have we heard in debates on agriculture in this House that the Common Agricultural Policy functions as a regional policy? That is nonsense because that description is simplistic, inaccurate and confusing. The Common Agricultural Policy will have to change and our perception of it will also have to change because the other 80 per cent of our population—the non-farmers —must be considered. In other words, financial aid to agriculture must be measured not from the point of view of putting more money into farmers' pockets but from a much wider perspective. The sooner this kind of expensive and selfish madness is ended the better for all of us.

No one can deny that the Common Agricultural Policy has created costly and unwanted food surpluses and has damaged Third World agriculture. It is also clear that the Common Agricultural Policy has served the interests of agricultural big business, has encouraged environmentally damaging farming techniques and has led to uneven economic development throughout the EC and throughout this country. In this connection, there should be an opportunity for us to cash in on Ireland's increasingly unmerited image among Europeans of being clean, unspoilt, unpolluted, etc. The promotion of agricultural industry based on the image of organic farming would be very important in this context.

The fact that agriculture accounts for two thirds of the EC budget is testimony to a gravy train out of financial control, and also reflects the relatively low level of public spending by the EC on regional social policies. The recent increases in "structural expenditure" to tackle unemployment and regional under-development agreed at the Brussels Summit is a poor response given the scale of the economic and social problems in Ireland and throughout the EC.

As a people and a Community we must face reality sooner or later. For a start we will have to face the fact that the Common Agricultural Policy will have to be drastically reformed. The Common Agricultural Policy was originally set up to make European agriculture more efficient and productive and to bring order and stability to the marketplace. What has happened? We now have expensive butter and beef mountains, overflowing wine and milk lakes and this year every man, woman and child in the EC will have to pay £110 in higher food prices and £59 in higher taxes to keep the Common Agricultural Policy going. These figures are worth concentrating on.

There is an old saying that there are more ways of choking a cat than pouring hot butter down his throat, but in a world where millions are starving and many more millions are on the poverty line, EC wine is being turned into paint and EC butter into lipstick as a direct result of the Common Agricultural Policy.

Our farmers must diversify their products to meet the changing needs of European markets. At present we have only a mere toehold on this market and that is not good enough. Our survival as a people could very well depend on far more enlightened and effective responses from our farmers and their organisations. The importation of hundreds of thousands of pounds worth of food, including a wide variety of vegetables, is a continual scandal which we cannot justify. There is no reason we should not grow our own food, including vegetables.

In regard to taxation, farmers always say they are willing to pay their fair share of taxes but not just yet. As long as I have been in politics — for the last 25 years—the farmers, most of whose leaders come from the Golden Vale area where I come from, stand up and say, "Yes, we will pay our taxes but not just yet". No matter what scheme we try to devise for them, they will find some argument, some disagreement, some loophole. That attitude must go. The farmers must play their part in the financing of this country. They have got away with murder for far too long. The land tax seems to be the fairest way and the progressive way to impose taxes on them. I appeal to the Minister concerned to use whatever influence and power he has to push and force the farmers into the tax net. We cannot continue to subsidise them as we have been doing. They admit they are paying £30 million to accountants to doctor their books. How much better it would be for all of us if they paid £15 million which I believe they owe— not £30 million — to the Exchequer directly. We would all benefit from that. I hope the Minister when replying will address himself to the question of taxing farmers because for too long every politician has evaded it.

Mr. Sherlock

It is interesting to note the contributions that have been made to this debate. A previous speaker said he and his party would not wish to be seen to be anti farmer. Deputy Kemmy has made a very good contribution and we in The Workers' Party want to make it clear that we are not anti farmer. We want to put forward good, constructive points and not the kind of thing we have heard from the Government party and the main Opposition party. A number of important items are covered by this Estimate. It is not possible to refer to them all in any detail but a few specific items need to be mentioned.

One of the biggest allocations, £8 million, is for agricultural research, education and advice. We welcome that. All these areas are vitally important and everyone would accept the need to invest substantially in them if we are to make the best possible use of our agricultural resources. There is a greater need now than ever before to modernise and adapt to the changing needs of the market. The present methods of producing from the land will have to change within the next few years. Change will be forced on farming because the present levels of intervention payment will not continue indefinitely.

Legislation was passed this year merging AFT and ACOT to form Teagasc. Despite our reservations, we are hopeful that the new body will give the necessary boost to education and training for farmers, but it seems Teagasc have been starved of the resources necessary to do their work. It is ironic that this should happen when farming incomes are reported to be increasing substantially. I note in my area the development, which we welcome, in Mitchelstown Co-operative where it is proposed to increase the number of jobs by 40 in whey processing to cater for markets at home and abroad. I would mention also the recent takeover of Horgan Meats at Charleville by the Halal Group. There have been 200 jobs lost there but I hope Halal will employ that number and many more because of the potential in that business.

A speaker referred to something which I thought a little out of the norm, that is the Sugar Company's tare assessing process. From the public statement issued and from my knowledge of the Sugar Company and the way they do business I would say their tare processing would stand up to any scrutiny. Let me put on record also that in my area, the Mallow Sugar Factory, because of their efficiency, can cope or compete with any factory in Europe at present.

I note a substantial increase in the allocation for disease control and eradication. The failure of successive campaigns by a number of Governments to end disease in our cattle has been one of the greatest financial scandals in the history of the State. More than £1,000 has been spent on various campaigns in the last 20 years and we are no nearer to having a disease free cattle herd than we were at the start.

The vets have made huge sums of money from the campaign: £10.6 million in 1983, £8.3 million in 1984, £11.9 million in 1985, £11 million in 1986 and £12 million in 1987, a total of £50 million in five years. Much of the work done by vets in this area could be done by competent technicians but there seems to be a reluctance to take on vested interests of the veterinary profession. I would like the Minister to indicate how much of the Revised Estimate allocations will be going on veterinary fees. No reference is made to sheepscab control. There is an alarming outbreak of it in County Cork. There is a sixfold increase in the outbreaks this year and a national policy is needed to control movement, dipping and the indentification of sheep. Some county councils still do not have a veterinary surgeon appointed to do this more efficiently.

One area in which money has been saved and is being returned to the Exchequer in this Estimate is subhead D.4, money allocated for An Bord Glas. The Government have failed to get An Bord Glas off the ground and functioning despite all their promises. It is ludicrous that a country with so many natural advantages as Ireland should import £1,000 million worth of food products each year and it is particularly scandalous that we import £200 million worth of fruit and vegetables annually much of which could have been produced at home. The failure of successive Governments and of the farming bodies to ensure that job creation in agriculture was fully developed and robbed people of tens of thousands of jobs that would have ensured from the proper use of development of our land. It has meant also that the country has had to import hundreds of millions of pounds worth of foodstuffs that could have been produced at home.

I have referred to Holland as an example we should aim to follow in this area. They have 4 per cent of their total agricultural land under glass. We should aim at least to put 4 per cent of our agricultural land into horticultural production with a good proportion of this under glass, based on the Dutch experience. This could create an additional 40,000 jobs on the land with as many as 50,000 additional jobs in processing. Unfortunately, there is little or no tradition in horticulture in this country, and that is why a body like An Bord Glas are so necessary. It is regrettable that this organisation are not being put into action yet.

A substantial part of this Estimate relates to various EC schemes, and Irish agriculture has to accept that the days of the CAP as we know it are over. Despite the fact that hundreds of millions of £s have been poured into farming from the CAP, we have an abysmal level of productivity and a declining number of jobs. Some big farmers are doing well out of the CAP but it has done nothing for the rest of them. It has also added substantially to the food bills of the consumers. The British consumers' association estimated recently that CAP was adding £13 per week to the food bills of families in Britian.

I note also in this Estimate an allocation for subsidies on milk and dairy products for human consumption, presumably relating to payments due for the period before their abolition. The decision to scrap food subsidies was one of the most shameful made by the Coalition Administration, and was a severe imposition on the poorest and weakest sections of Irish society. Both bread and milk are items on which low income families rely very much, and they are products for which there is, in most cases, no alternative. Prior to the removal of the first part of the food subsidies in 1984, a pint of milk cost 21p. It now costs 31p in Dublin and slightly less in country areas, representing an increase of almost 50 per cent. Butter was less than £1 per pound and is now £1.40. The price of a standard loaf of bread has increased by 75 per cent since the food subsidies were first cut. The fact is that as a result of the abolition of food subsidies, and the failure to ensure that payments were adequately increased, there is a shocking level of poverty here which has been graphically described in recent reports of the Combat Poverty Agency and a number of "Today Tonight" programmes. Many families on social welfare can simply no longer afford such essentials as bread and milk.

Part of the Estimate also relates to the winding up of Bord na gCapall. The decision to scrap Bord na gCapall was a particularly shortsighted one and should be reconsidered. There is a need for a body to promote horse breeding, outside of the thoroughbred area. This can be a useful source of additional income for small farmers. There is, particularly, a demand abroad for Irish draught horses and for Connemara ponies. The number of registered Irish draught mares went down from 92 in 1985 to 63 in 1988, which seems to indicate a declining interest by farmers in this area, when the Government should be doing all possible to promote it as a possible alternative source of farm income.

The Minister referred to receipts from the EC in respect of market intervention and disadvantaged area schemes and said that the reduction in receipts under the disadvantaged area scheme was directly related to the level of 1987 payments under those schemes which reflected a drop in cattle numbers. That is a scandal and as a result we have to import calves from England. When will the Minister make a statement of his intention to increase the number of disadvantaged areas? I am sure he has received many submissions to fit the criteria for this scheme. It is important that we encourage people to stay in farming and they should get the benefits that are available. The Minister should give us some indication of his intention in regard to that scheme.

An Leas-Cheann Comhairle

I should like to advise Deputy Deasy, who is offering, that, according to the order of the House he will be confined to two minutes.

Mr. Deasy

In that space of time I can only welcome the Minister back from Brussels.

An Leas-Cheann Comhairle

The order of the House requires that the Minister be called at 4.5 p.m.

Mr. Hegarty

The Minister should give Deputy Deasy five minutes of his time.

Mr. Deasy

I will be brief. A lot of what I have heard so far is historical and does not relate to what is happening. We heard a lot about the abuse of the CAP but the problems within the CAP have, by and large, been solved. It is not fair that people should say that we have abuses of the CAP and many surpluses. The days of surpluses have virtually gone. At present the Minister is defending the last bastion of surplus in the EC, the stocks of beef that are in intervention. It is imperative that he wins the day in regard to that product even if he has to invoke the veto. We have got rid of butter stocks and skimmed milk powder stocks and there is not much abuse in those areas.

The main point I should like to make is that the threat to Irish farmers does not come from within Europe but from within GATT, the worldwide organisation for trade. If the Americans get the agreement of a significant number of EC countries it is possible that aids and subsidies to farmers will not just be seriously eroded but may eventually be eliminated. In the course of a parliamentary question I suggested that a Cabinet Minister of the Government attend all meetings of GATT from now on to defend our position because we know that the Americans want to get rid of subsidies. The British and the Dutch also want to do so. If a country like Germany, the major power, decides to go along with that policy we will be in serious trouble. The battle will not be in Europe or on the Common Agricultural Policy; it will be on international trade involving every country in the world. It is important that we have a Cabinet Minister present at those talks. I hope the Minister bears that in mind. The Government should take that suggestion on board.

I agree with what Deputy Kemmy had to say in regard to land tax. It is time that the Government had a rethink on that issue. It is a scandal that so little taxation has been taken in at a time when farmers are willing to pay at least twice as much through the medium of a land tax. It was a serious error by the Government to promise in the course of the election campaign that they would not introduce the land tax. If £70 million can be collected and if we can eliminate the anxieties of many small farmers who have to fill in tax forms we should introduce such a tax. If we can double the take why not do so.

An Leas-Cheann Comhairle

I must remind the Deputy that he is thieving in ministerial pastures.

Mr. Deasy

I should like to congratulate the Minister on providing £500,000 for the refurbishment of race courses, in particular Fairyhouse. In my view Fairyhouse is as good a National Hunt course as there is in England or Ireland and it needs that type of investment badly. The track is perfect but the facilities are pretty dreadful. That money is badly needed and it will be well spent.

Minister for Agriculture and Food (Mr. O'Kennedy)

I thank the House for the response to this important Supplementary Estimate. I also thank Deputy Deasy for raising a matter that I did not mention, the importance of the GATT negotiations. I assure him, and the House, that I am conscious of the importance of those negotiations. With my French colleague we uniquely managed to get an agreement from the Council of Agricultural Ministers which was not thought of, much less talked about. That decision was of immense benefit at the Montreal mid-term review. It meant that there was a solidarity which otherwise would not be there. The presence of a Cabinet Minister at those discussions was a deliberate decision taken after consultation with my French colleague and the Commission. Had we all gone to that meeting we would have put a focus on agriculture that the Americans wanted. It is important that our strategy is right. Had all Ministers of Agriculture gone to that meeting the Americans would have had what they wanted, agriculture up front. I can assure Deputies Deasy and Doyle that while it is up front in our priorities our attendance at particular meetings is a matter of judgment. We are keeping in touch with the negotiations.

As Deputy Deasy said, it is time we stopped attacking the Common Agricultural Policy. We can leave that to non-Community countries. Very significant disciplines have been introduced and in Ireland we are redirecting the thrust of that policy to maximise employment. Ireland is the only country in the European Community in the position where 10 per cent of our gross national product, 20 per cent of our total employment and 30 per cent of our total exports derive directly from the agriculture and food sector. Those who would simply look at agriculture and food as being for farmers — I do not suppose Deputy Sherlock would insist on that — are overlooking the essential fact that this is uniquely a crucial element in this economy. I have an obligation to enhance and expand it at every level for the primary producer, who must be healthy, to the processor and the employee, and we are doing that. I do not have time to demonstrate how except by indicating that for the market focus we are becoming a dominant force in European agri-food as is evident from what is happening in the agri-food sector in new and major companies. That cannot be done without a healthy basic primary producer. I hope from now on we will stop putting them against each other because they are totally interrelated in this economy.

I have no responsibility for tax any more than the Minister for Education has responsibility for taxing teachers or the Minister for Health for taxing doctors. My only job is to enhance the income of the primary producer. Without going into any detail all I would say is I am doing my best and I think we are achieving results. Taxes follow as a matter of consequence. I will continue to do all possible to enhance the income of the primary producers and the tax will, on the basis of this Government's policy, be levied on the same basis as every other sector. Nobody is going to listen when Deputy Doyle says this Government are endangering agriculture and that this Government have shown no concern for agriculture. I will leave that statement on the record of Deputy Doyle because I think this is a classic case where, as the Romans used to say, res ipsa loquitur, the facts speak for themselves. I do not have to defend or vindicate what I or my Government colleagues are doing for agriculture because the facts speak for themselves.

Mrs. Doyle

Does the treatment of Teagasc and An Bord Gáis speak for themselves?

Mr. O'Kennedy

When we bring in extra money we are being accused of undermining it. I will be seeing the chairman and director of Teagasc as soon as I get away from this House.

Mrs. Doyle

Be sure they are solvent.

Mr. O'Kennedy

That is not their view. I want to make a point because it is very important that this has been raised——

Mr. Sherlock

Give him my regards.

Mr. O'Kennedy

There has been some comment during the course of the debate about the fact that the increase in agricultural incomes was not even across the board, that many of the smaller farmers did not enjoy the same advantage. I accept that. I would like to say two or three things about our policy and I hope my good friend and colleague, Deputy Deasy, will not take objection to one of those points. First, we took action to protect that small person over the last four years in terms of the quota which is a very special asset now. It was the power of the cheque book that determined who could buy a quota. I stopped it. It is now the young farmer and the small farmer who gets priority. Second, in relation to small farmers there has never been such a focus on the western development areas, the western package, the special rate of grants and the whole scheme for disadvantaged areas. Incidentally, I want to inform the House of the good news that early in the new year the surveyors will be out on the field examining all the areas for extension of the disadvantaged areas.

Part of the package which we have not yet concluded — it is under discussion now — is for a very significant scheme of income aids for small farmers which I have been promoting at European Community level. We want to get the right kind of income aid scheme. I want to assure this House and the public that this is priority for us, to create the conditions in which the healthy can better themselves but above all to ensure that the family farms and the small farmers are protected. In the short time that is available to me that is all I can deal with. I thank Members of the House for the points they have made. On a procedural point I want to read into the record——

Mr. Sherlock

Can the Minister say something about TB?

Mr. O'Kennedy

There is no extra estimate for vets or anybody else involved in the TB scheme.

Mrs. Doyle

That is Silver Hill duckling.

Mr. O'Kennedy

That is not involved. I need to read into the record that the savings shown in the second page of the Supplementary Estimate in respect of subhead L.4 should read £12.875 million and not £12.860 million as shown. The total savings figure of £17.735 million is, however, correct and in this regard I am advised that this minor error in the detail does not invalidate the Supplementary Estimate.

Mrs. Doyle

The Minister should be grateful that it was brought to his attention.

Mr. O'Kennedy

Deputies will appreciate because of my late arrival here today I did not see it until I walked in here, a half an hour ago, after arriving home. I thank Members of the House for their contributions and I assure them that in 1989, as in 1987 and in 1988 under this Government, agriculture and food and those who depend on it for their employment is in safe hands.

Mrs. Doyle

What about Bord Gáis?

Vote put and agreed to.