I wish to share my time with Deputy Kenny.
Private Members' Business. - GATT Negotiations: Motion (Resumed).
The following motion was moved by Deputy Yates on Tuesday, 16 February 1993:
That Dáil Éireann reaffirms its opposition to the proposed GATT deal as it is currently framed in view of the prospect of reducing gross agricultural output by 5 per cent and as it extends beyond the level of volume and value restrictions on agricultural output agreed by the Council of Agriculture Ministers in June 1992, as part of Common Agricultural Policy reform; and calls on the Government to ensure that Ireland's vital national interest and employment are protected before these proposals are ratified.
Debate resumed on amendment No. 1:
To delete all words after "That" and substitute the following:
"Dáil Éireann fully supports the efforts of the Government in its defence of Ireland's vital agriculture and food interests in the ongoing GATT negotiations."
—Minister for Agriculture, Food and Forestry.
Is that agreed? Agreed.
As I said last night, the situation is pretty grim in relation to the GATT negotiations. In my constituency of Cavan-Monaghan dairying is the most important source of income, not just for the farmers but for the whole area, co-ops and industry included. Over the last ten years more than 50 per cent of farmers have been forced out of dairying. That was before Common Agricultural Policy or GATT. Obviously, if the current GATT agreement is allowed to go through in its present form that exodus will continue and will mean that young farmers will not be able to get into production and the damage to rural life will be major, not only in Cavan-Monaghan but throughout Ireland.
I mentioned last night that there was no curtailment of production in the USA, Australia or New Zealand. However, we must remember that Eastern Europe produces almost twice as much as EC countries and there is no curtailment there either. In fact, maybe some of these areas will become part of the EC and that will cause their own problems. It must be taken into account that in the agreement in 1983 which brought in the milk quotas there was a stipulation that if extra milk quotas were to be given Ireland would get its fair share and would be treated as a priority area. However, this year under and Irish Commissioner for Agriculture, Ray MacSharry, the Italians benefited by obtaining an increase of 10 per cent on their quota and at the same time Ireland had to take a decrease. Under the present GATT proposals that decrease could be a further 5 per cent over the next five or six years. This is something we cannot allow to happen. This Government must treat the present situation as a very serious one for the small and medium sized milk producers and must oppose the GATT proposals in the strongest possible way.
In recent days we have been informed that farmers have had an 18.5 per cent increase in their incomes. Of course, we were wise in asking from what base that increase occurred. With the increase in sheep numbers which Minister O'Kennedy encouraged, there has been the total failure of this Government to provide adequate safeguards for sheep producers and, more recently, the total failure of this Government to handle the currency crisis has resulted in total loss of faith in the Minister's and Government's ability to deal with the EC, not to mention international GATT agreements.
In relation to the meat industry, the Irish Commissioner, Ray MacSharry, allowed a rule to be brought in that stops animals over 340 kilos being accepted into intervention. While we have negotiated some extension to the introduction of this rule it will militate against policy production of cattle, especially from the suckler herd, which we have been trying to encourage. As a former committee chairman, with others, I encouraged the introduction of continental type cattle. This means simply we will not be able to afford to bring them into proper weights to meet the different marketplaces because, if the market is not there on a given day, intervention will not be available and that is the only safeguard. With regard to heifer meat, from 1947 until about 1989 we had a special arrangement with our colleagues in the UK. For instance, from 1973, when we entered the EC, the UK value of a premium paid on both heifers and steer meat going into the UK was mainly financed by the UK budget. This was in place until our own Commissioner, Ray MacSharry, had it abolished which now means, first, we have no support for heifers and, second, ——
He has left Sligo.
——we do not have special opportunities in the UK that we had all those years for meat in general. In fact, we are now in open competition with German bull beef and all other meat from outside the EC.
It is interesting to look at sheets from 1982, heifers were making 94p per pound in July of that year and the cost of slaughtering for ten heifers was £13.75. Perhaps that would be a reasonable price this year but the stoppage per beast is a lot higher now than it was in 1982. While the heifer price may be reasonable at present one does not have to stretch one's imagination too far to realise what will happen with an extra couple of hundred thousand steers being forced onto the market if the GATT proposals are allowed to go through.
Again, we may not be able to dispose of heifers at all; maybe in the west we will but not in the rest of the country. This is the sort of problem that the Minister, the Tánaiste and every other member of the Government must treat seriously. We must make sure that the GATT agreement now proposed does not and will not stop Irish farmers, especially young farmers, remaining in business.
I would like to make a few brief points in relation to this fundamentally important motion. First, for years we have prided ourselves on our instructions to farmers and directions from advisory services to use and to breed the best possible cattle. Breeding pedigree cattle from better quality bulls has meant production of bigger carcases. The weight limit of 340 kilogrammes will certainly very much limit access to the intervention market for the kind of cattle that would be produced from all the instructions over the years. It is a very negative and retrograde step to contemplate this.
A 38 per cent cut in export volumes means some 200,000 fewer Irish cattle being eligible for export to non-EC markets. This is of particular importance to the west as many of the plainer type cattle are priced upwards because of this market and it will put a complete blockage on the smaller farmer on the poorer land in the west from being able to dispose of the kind of cattle that he raises in general.
A further 5 per cent reduction in the milk quota would certainly considerably reduce the milk pool available to the west by an estimated three million gallons. As dairying has been one of the most profitable aspects of the agricultural business over the last number of years it is important that the quota would be retained and expanded. As mentioned, the Italians were able to negotiate an increase whereas we have not been able to negotiate any despite the fact that the Treaty of Rome indicated clearly that comparative advantage for individual countries should be exploited and our comparative advantage lies in the production of milk and beef. It is a failure of the Government and of the Department not to have negotiated an increase in the milk quota here.
The pigmeat sector had gone through very disparate stages over the last 20 years. If the GATT negotiations go through as proposed, an extra 500,000 tonnes of pigmeat imports will be allowed into the EC, this will devastate the smaller pig producer and something must be done about that. These proposals would dramatically hit the agri-business in general and will lead to a further decline in jobs and farm incomes. It should be borne in mind that rural Ireland is being devastated on a number of fronts. One has only to drive through the more remote parts to see the number of houses closed as a result of emigration, unemployment and an enforced decline in agricultural incomes. It is simply not on. Somebody must put a stop to it. I call upon the Minister and the Government to take the matter to the EC and to ensure that the proposals in this motion by Deputy Yates are implemented for the good of all our farmers.
I wish to give five minutes of my time with Deputy Leonard.
Is that agreed? Agreed.
My colleague the Minister for Agriculture, Food and Forestry, Mr. Walsh has already given a detailed presentation on the GATT dossier. I would like to take the opportunity to deal more specifically with the agri-food industry and the impact which the GATT agreement will have in this area. I would also wish to return to particular points of relevance in the GATT discussions.
All members are well aware of the significance of the agri-food sector to the Irish economy. It is, as the Culliton report acknowledges, the most important element of the indigenous sector of Irish industry. It accounts for almost one-third of the gross output of all manufacturing industry in Ireland, some 30 per cent of the employment of Irish-owned manufacturing firms and over 20 per cent of total manufacturing employment. These figures, however, do not do full justice to the importance of the agri-food sector because they omit the fact that the inputs to the sector are home-produced to a far greater extent than the inputs to any other sector of the economy, nor do they take account of the contribution which the sector makes to the preservation of rural areas.
Since joining the European Community there has been a strong emphasis on the production of commodity products such as beef, milk powders and butter with a significant volume of output being put into intervention. While this has resulted in increased production levels and reasonable returns to our producers, nevertheless it did not encourage the food industry to diversify or to promote a wide range of products on international markets. In recent years the ever escalating cost of intervention operations and the acceptance that it was no longer possible to continue producing goods which had no real markets have made it essential for the industry to adapt to the demands of the market place and to become more competitive. It has been accepted by all parties, including the farming organisations, that over-production could not continue and that a more rational system geared to the needs of the market had to be put in place.
It was in recognition of this fact that the Government devoted special attention under the Programme for National Recovery to the expansion of the food and drink industry, the importance of which was again underlined in the recent Programme for a Partnership Government. Policy over recent years has been clearly directed towards developing a modern industry to develop the significant job opportunities and exploit the potential of the sector. Major investment has taken place in the beef, pigmeat and dairy sectors. Our pigmeat sector now has modernised slaughtering plants capable of competing with international producers. The dairy sector has been undergoing rationalisation in recent years and we now have a number of major agricultural co-operatives which export significant quantities of Irish food products. Furthermore, these co-ops have expanded their operations by acquisitions in Europe and the United States. There have also been expansions in the beef sector.
The various State agencies have also played their role. In particular, they have been instrumental in emphasising the importance of the market led approach and impressing on companies the need for them to have a clear strategy for developing their markets. Grant assistance is now being directed towards companies who are committed to providing quality Irish products for export markets. Overall the emphasis is being put on the market place and away from production.
Much, however, remains to be done. The agriculture and food sector is facing new challenges in the years ahead from the advent of the Single Market, the eventual GATT agreement and the likelihood that greater market access will have to be conceded to the new democracies in East Europe. There will have to be an even more decisive shift to marketled production. Ireland has a lot of natural advantages — in particular I am referring to our largely extensive production methods and a relatively clean and pollution-free environment. In addition, there is now a mechanism in place to cope with our long-standing seasonality problem which should assist the securing of a greater share of Community markets with a consequent reduction in the dependence on intervention. The farming and processing industries must take advantage of these resources and build markets for premium high quality products.
For its part, the Government will continue to work in co-operation with the industry to provide the support and encouragement necessary to meet future challenges. A programme of investment has brought about the major developments in the food processing industry and the extensive modernisation of facilities already referred to. More than £44 million in FEOGA processing and marketing aid has been made available to the Irish agri-food industry. It is anticipated that the new Structural Funds, when they come on stream, will add further to the achievements to date. Some £20 million has also been contributed by the Exchequer. All this has brought about substantial upgrading of plants, increased processing and improved quality and hygiene standards.
The development of a successful marketing strategy will be an essential element in the future strategy of the food industry. Several State agencies are involved in the promotion of food products but while they do a good job, a more rationalised approach is needed. Accordingly, the Minister for Agriculture, Food and Forestry established an expert group on the food industry last year whose task it is to prepare a national food industry development plan for the coming years. The group consists of retailers, producers, processors and State agencies under the chairmanship of the Secretary of the Department of Agriculture, Food and Forestry. It is expected that the group will submit its recommendations for action to the Minister shortly.
Irrespective of the outcome of the GATT negotiations, it is clear that the current and future trend of agriculture and economic policies will be to move away from market support towards direct payments to farmers. More and more the agri-food industry will have to compete on its own merits. This will, I feel, be benefical to the industry in the long term provided it is done in a gradual and balanced way allowing time for the necessary structural changes to be put in place.
Turning back now to the GATT negotiations, I must point out that, contrary to what some speakers have indicated, there is as yet no GATT agreement. What is under discussion is an agreement reached by Commission and US negotiators on agriculture which has still to be accepted by the Council, the US Congress and the other parties in the GATT. There are also 14 other topics in the negotiations, some of which are providing as difficult, if not more so, to resolve, for example, services, market access and intellectual property rights. it has been presumed that once the EC and US resolved their differences on agriculture then agreement would be possible in all the other sectors. However, this has not been the case and many parties, including the US, have raised difficulties in these sectors which will not be easily resolved.
The Minister outlined here last night the main thrust of the current proposals on agriculture, which will cover the three areas of domestic support, border protection and export competition. There has been little reference in the contributions here to date to the domestic support aspect, because the EC will not have to do anything additional to meet the proposed 20 per cent reduction in expenditure. The reason for this is that estimated current expenditure, which takes account of Common Agricultural Policy reform, will be significantly lower than in the base years. I should add that the choice of base years was put forward by Mr. Dunkel and was not chosen arbitrarily by the EC, as one Deputy seemed to suggest last night. The Commission estimates that there will be a surplus of some 13,000 mecu which can be used to cushion the impact of measures in other areas.
The domestic support aspect also covers the now infamous "green box" of policies which will not be subject to reduction under the GATT agreement. There were several references to premia payments in the debate last night and I would like to take the opportunity to clarify a few matters. Firstly, the Commission has clarified that the ewe premium would fall into the green box because it will not be subject to quantitative restrictions following Common Agricultural Policy reform. The Commission has also confirmed that the other headage payments in the disadvantaged areas would be exempt from reduction and the provisions of the Final Act will have to cover this. This is one of the aspects that we will be seeking to clarify in the on-going discussions at expert level. It should be recalled when the Council mandate was agreed in November 1990, the Commission gave a firm undertaking that the level of these payments would not be reduced. Our aim is to ensure that not alone is this commitment respected but that nothing in the agreement would prohibit the level of payments from being increased in the future. The proposed "peace clause" gives rise to some concern in this respect and we will be clarifying the position with the Commission during the discussions already referred to.
Reference was made last night to the possible introduction of national aids by other member states as an alternative means of supporting agriculture and the difficulties which would arise for Ireland under that scenario. It must be stated that EC rules are absolutely clear on such aids — any state aid which distorts or threatens to distort competition is not allowed. National aids which upset the competition position between member states are not permissible.
Border protection covers the tariffication of border measures such as variable levies and commitments on current and minimum access. The proposals put forward by the EC in relation to tariffication, together with the suggested safeguard clause, should provide adequate protection for almost all sectors of interest to Ireland. A risk was identified in respect of skim milk powder and sugar but the Commission is proposing a lower rate of reduction for these products. Deputies have correctly identified the minimum access commitment, and in particular whether aggregation of meat products will be permissible, as the most critical concern in this area. The Commission has proposed the aggregation approach in its submissions to Geneva and has assured the Council that this has been accepted by the US but our concern is that the Final Act, as currently drafted, does not make this explicit. Ireland, and other member states, have been emphasising this point to the Commission and we are insisting that the draft Final Act must be amended in order to prevent future challenges in the GATT. It is absolutely essential that there is no misinterpretation on this point and that all parties accept it.
There are, of course, some advantages to the minimum access commitment and all other parties, including the US, would have to open up their markets so as to meet the 5 per cent commitment, if it is not already being met. In response to a question raised last night, EC farmers will be able to export dairy products to the US market within these limits but they will of course be in competition with the other parties in the GATT.
The proposed restriction on export supports, particularly the volume limitations, is potentially the most damaging commitment in the proposed agreement. The position is exacerbated by what is know as front-loading, that is that exports would have to fall back below base levels — average of 1986-90 exports — in the first year of implementation. This causes very serious problems in the beef sector where current export levels are 200,000 tons higher than in the base period. There will also be problems in the dairy sector, particularly in relation to cheese exports, and in the whitemeat sector. The volume restriction commitment raises difficulties for other member states too, even for staunch free traders such as the Netherlands and Denmark, and the Commission is under pressure to modify the commitment. Our aim is to try to reduce the level of the commitment and also to seek an end of period commitment so that the impact of front-loading is moderated. On a more optimistic note, it should be said that the Common Agricultural Policy reform outcome will lead to a reduced need for refunds in the cereals sector and probably also in the whitemeat sector where refund levels are already low and which will benefit from a substantial reduction in feed costs.
The Minister and his officials will make every effort to ensure that what is eventually agreed can be contained within the outcome of Common Agricultural Policy reform or, if not, that we get firm commitments that our vital interests will be protected. It should be pointed out that even when an overall agreement is in place the impact on the individual sectors and on each member state will depend on the rules and regulations which are subsequently put in place to implement the various commitments undertaken. The implementation of the commitments will be an internal Community matter and will ultimately be a matter for the Council of Ministers to decide. Contrary to what Deputies Yates and Deenihan stated last night, there has been no decision, or even discussion, on how such commitments would be shared out in the EC. Our view is that the burden must be shared equitably throughout the Community with full account being taken of the contribution which sectors make to the economies of regions. The House can be assured that when this stage in the process is reached, the Minister will be seeking to ensure that Ireland's unique dependence on agriculture and in particular on exports is fully taken into account. While it is premature to speculate what from the implementing rules might take, we will certainly be seeking to ensure that the burden of adjustment and cost to be borne by Ireland, such as on the reduction of exports, takes account of our special situation in the agriculture sector and that it will not be based on any member state's contribution to intervention.
Deputy Deenihan expressed the view last night that the proposed agreement would allow the US and others to produce unlimited quantities of product while the Community will be subject to production quotas and other restrictions. This is a concern shared by the Minister and he has consistently pointed out in the Council that the Community will be required to bear a disproportionate share of the burden of reform. He has proposed that the agreement should include a commitment that other participants will observe disciplines on world markets.
I would also like to address the position if there is no GATT agreement. As the Minister already stated, it cannot be assumed that the status quo could continue unchanged. There has been an increasing number of challenges to the Common Agricultural Policy in recent years and we run the risk of many elements of that regime being found to be incompatible with the GATT, if new disciplines and rules are not agreed in the current negotiations. Deputies will recall that the US won two GATT panel procedures against the EC system of payments and subsidies for producers and processors of oilseeds and related proteins. It will also be recalled that the US threatened to impose unilateral punitive duties on many EC agriculture and food exports, including many of direct interest to Ireland such as cream liqueurs, casein and cheese, unless the matter was resolved.
There was, very rightly, grave concern expressed by all quarters concerning this action. The party leaders in their joint statement issued on 6 November called for all steps to be taken to avoid implementation of retaliation and counter-retaliation measures so as to avoid a trade war which would be in nobody's long term interests. We were pleased then, that there was a separate bilateral agreement on oilseeds with the US last November. The terms of that deal, and not the GATT deal as was incorrectly stated last night, would limit the EC production area of oilseeds to 5.128 million hectares. We do not, of course, welcome any such curtailment but it has to be borne in mind that the Community lost two GATT panels and a solution had to be found in order to avoid a trade war which could have had very serious implications for our exports.
An acceptable agreement which prevents future challenges to the Common Agricultural Policy in the GATT would be in our interests and would avoid the threat of a trade war arising again in the future. The proposed peace clause meets some of our concerns on this aspect and we are seeking clarification from the Commission on the precise scope of the measure. Having said this, it cannot, of course be a GATT agreement at any price, but must be one which protects our vital interests.
Deputy Cox made a number of comments last night which deserve a reply. The allegation that the Government and previous Governments had adopted a passive stance in these negotiations could not be further from the truth. Throughout this long process over the last six and a half years successive Ministers for Agriculture, Foreign Affairs and Industry and Commerce, including the Deputy's own Party Leader, have gone to great lengths to explain and forcefully defend Irish agriculture interests in all the relevant fora. Furthermore, no opportunity has been lost at the diplomatic level and in suitable bilateral contracts by the Taoiseach and the Minister for Foreign Affairs to promote Ireland's case. While it is correct to say that Commission negotiators have undertaken their own negotiating responsibilities in pursuing these talks within GATT and with the US side, the basic fact remains that the Council of Ministers will take the final decision on the Community's acceptance or otherwise of the outcome of these negotiations and a GATT agreement will not be accepted at Community level until that decision is taken by the Council.
The Deputy also made an interesting connection between the stance of the Minister for Agriculture, Food and Forestry as explained to the House last night on the eventual outcome of a GATT deal and the conclusions of the Edinburgh Summit in December. Regrettably, Deputy Cox quoted selectively from those conclusions in regard to the growth rate of the agriculture budget guidelines in the future and the possibility of its covering further measures which might be necessary to protect our vital interests. The Edinburgh conclusions also commit the Council to increasing the FEOGA guarantee fund if necessary, in order to finance the implementation of Common Agricultural Policy reform. If the evaluation exercise now underway at EC expert level confirms our view that the GATT outline agreement on agriculture goes beyond Common Agricultural Policy reform parameters, and if that agreement was nevertheless accepted, then the necessary additional resources would have to be provided.
While contributors to the debate last night detailed, with apparent certainty, the financial implications of a GATT agreement on agriculture for Ireland, it is, I hope, apparent to all by now that an assessment of the effect of a GATT deal on the Irish agri-food sector is no easy matter and the precise implications will not be known even when a final agreement has been negotiated. Nevertheless, the departmental services are making every effort to quantify, with reasonable precision, what the effects might be. The evaluation which is currently underway at EC expert level, at the Minister's instigation, will be an invaluable aid in this process. The group has dicussed the proposed agreement on two occasions, firstly in a very general manner and again this week when it focused its attention on the impact on the cereal and oilseeds sectors. Again, this was only a preliminary discussion and a more detailed assessment will take place over the coming weeks. It is clear from discussions to date that this is not a simple exercise and many complex and detailed questions have been put to the Commission for reply. The Agriculture Council will be kept informed of the progress made. Here at home all interests will be kept informed of developments through the GATT Forum which has remained in place since 1988.
The impact of the overall GATT agreement on employment levels in Ireland will be a major point for consideration when the Government is taking a final decision on the round. As already indicated there are 14 other topics under discussion in the round, including such sensitive sectors as textiles, services, and so on. My colleague, the Minister for Tourism and Trade, Deputy McCreevy, has overall responsibility for the GATT negotiations but a final decision will be the collective responsibility of the cabinet. That decision will have to take account of where Ireland's balance of interests lie in all sectors. However, in view of the importance of agriculture to our economy the impact on this sector will be the principal consideration in that decision.
The House will be interested to note that the Minister for Tourism and Trade has decided that an independent assessment should be made of the overall implications for Ireland of a Uruguay Round agreement. This assessment will take into account all of the areas under negotiation likely to impact on international trade including, of course, agriculture. It is understood that he will shortly commission a consultancy study that will be undertaken in consultation with the Tánaiste and Minister for Foreign Affairs and the Minister for Agriculture, Food and Forestry. The study will examine the impact of the round on Ireland from two perspectives: (1) the indentifiable sectors specific implications, and (2) the overall international trade and macro-economic implications. The Minister for Tourism and Trade intends to submit the conclusions of the study and his recommendations in relation to them to the Government for consideration as soon as possible thereafter.
The timing of such an exercise may of course be influenced by the rate of progress in the negotiations. As the Minister for Agriculture, Food and Forestry indicated last night, the latest reports are that the US will seek an extension of its fast-track negotiating authority for an additional six to nine months. Consequently, it is expected that an overall agreement covering all sectors will not now be concluded until late this year or early next year. The agreement, and thus the implications for each sector, may not become clear until much later this year and so the consultancy group may not be able fully to complete its task until then.
I would like once again to reiterate the concerns of the Minister regarding the proposed EC-US agreement on agriculture. Based on available information and evaluation carried out to date, his view is that the agreement is not compatible with the outcome of Common Agricultural Policy reform and that it would require additional cutback in EC production levels. If this is indeed shown to be the case, then he will be seeking firm commitments that appropriate measures will be taken to protect our vital interests.
The Government, including the Tánaiste and Minister for Foreign Affairs and the Minister for Trade and Tourism — who has overall responsibility for the GATT and these negotiations — are fully committed to this objective also and all will be working in concert to ensure that it is achieved. I therefore commend the amended motion to the House.
I support the amended motion. The farming sector has faced considerable uncertainty in recent years as the Community reviewed and eventually agreed measures aimed at reforming the Common Agricultural Policy support arrangements. The sector continues to face some uncertainty in light of implementation of the various measures agreed last May. It is therefore inevitable that farmers remain concerned that the eventual GATT agreement might require some further adjustment to Common Agricultural Policy support at production levels. I was therefore very pleased to hear the assurance last night, from the Minister, Deputy Joe Walsh, and tonight from the Minister of State, Deputy Brian O'Shea, that the Government will continue to oppose any outcome to the GATT negotiations which would be damaging to our vital interests in the agriculture and food sectors and in particular that they will oppose any agreement which is not compatible with the reformed Common Agricultural Policy.
It is clear that the agreement reached by EC and US negotiators could have adverse implications for some of our more important sectors, especially our beef industry. I hope that in the ongoing negotiations it will be possible to secure the changes to the agreement identified by the Minister. I am confident that the ongoing analysis being undertaken at expert level in the Community will bring home to all member states that the commitment in the EC-US agreement will require the Community to go beyond the Common Agricultural Policy reform outcome and that appropriate measures will be taken. The Minister has clearly identified the proposed limitations on export subsidies as a main source of concern. They would impose a disproportionate share of the burden on some Community producers while others may escape relatively unscathed. The Minister is quite right to seek significant changes in terms of the commitment made and in the rules for implementing such a commitment. I agree that the Minister should seek to ensure that farmers in other countries make an appropriate contribution towards restoring a greater balance on international markets.
There are a number of positive elements in the draft EC-US agreement. It is essential that any final agreement should exclude Common Agricultural Policy reform compensation and headage payments from the GATT disciplines. Equally, there should be clear trade rules to avoid challenges in GATT to our domestic support and trade arrangements. Clearly considerable work remains to be undertaken before a final agreement is reached. I am confident the Minister and his colleagues will continue to outline the vital importance of the agriculture and food sectors to our economy in the ongoing negotiations and that they will be able to secure an outcome that will protect our interests.
I mentioned the beef industry as being an area of concern. Let us look at the amount of beef put into intervention in the last number of years. In the early seventies we exported 40,000 tonnes of beef per year to Germany but in the early nineties that figure dropped to 12,500 tonnes at a time when 85 to 90 per cent of our kill was going into intervention. That is a matter that will have to be carefully examined.
I congratulate you, a Leas-Cheann Comhairle, on your position. I wish to share my time with Deputy Boylan.
Is that agreed? Agreed.
The proposed GATT deal will have a fundamental impact on Irish agriculture. Indeed in the opinion of many it poses the most serious threat ever to Irish farmers and the Irish agricultural sector. As it has potential to cause a loss of almost 20,000 jobs and a total diminution of the family farm enterprise, thereby threatening the survival of our rural communities, our vital national interest must be protected at all costs. The Government has a responsibility to vote against the present deal or else to secure special treatment for the Irish case. So weak and ineffective have been the attempts by the Government to date to protect the livelihoods of Irish farmers that I ask: does anyone on the Government side of this House really understand the precarious position of the agricultural sector and the threat of new extensions that these proposals hold? Despite the protective stance taken by the Minister of State, I agree with Deputy Cox that the stance taken by the Government to date has been nothing short of passive.
The combination of the Common Agricultural Policy reforms and GATT negotiations represent a fundamental change in agricultural policy in Ireland and the European Community. These two issues are clearly interlinked. Common Agricultural Policy reform decisions were influenced by the demands of other GATT participants. More importantly, it is now sadly obvious that perhaps further Common Agricultural Policy cuts will have to be implemented to accommodate the GATT outcome.
The whole nature of farming is changing, eliminating any scope for decision-making by the individual farmer to undertake a particular enterprise, confined and restricted as he is by quotas. There is also a drastic change in the structure of farm incomes with a significant cut in the value of agricultural output and a major increase in the role of direct payments. The cheque in the post replaces increased production. Comparing the structure of national agricultural output and income last year with that envisaged in 1995, when Common Agricultural Policy reform is fully implemented, it is likely that gross agricultural output will fall by a massive 14.5 per cent. Direct payments, which now contribute 25 per cent of net farm income, will in 1995 contribute 50 per cent of net farm income. This is the type of future that faces Irish farmers, particularly those in the beef, cereal and sheep sectors who will depend to an alarming extent on direct compensation payments. What is being created is a nation of parttime farmers; family farms will no longer be viable. The outcome of this will be that the agricultural sector will have no prospect whatsoever of providing industrial or service jobs necessary to contribute to the creation or preservation of employment. Having a very weak industrial base, we need a strong agricultural industry to stimulate jobs in very fast fading rural communities.
The current round of GATT negotiations focuses on agriculture. Sadly, the objective of the US and others, such as Australia and New Zealand, is to progressively dismantle the EC's Common Agricultural Policy by demanding that the EC reduce import barriers to the extent of even ignoring the over-supply problems within the EC itself, that the EC exports less, thereby reducing the volume of EC products to be converted by export refunds, and that the EC reduce internal Common Agricultural Policy support to its own farmers. These demands, we must all admit, are a lethal attack on European farmers, particularly the Irish farmer who will suffer most. It should be noted that despite the major cuts already implemented in agricultural prices and supports, the US Government is still not satisfied. The implications of these demands for Ireland are disastrous.
My colleague, Deputy Yates, last night outlined very clearly the implications for each sector and the alarming consequences for the beef, pigmeat and dairy sectors. As he pointed out, no sector is spared. The cereal, poultry, sheepmeat and soya sectors will have a high price to pay. All these matters make our economic outlook bleaker. What is most alarming is the failure of the Government to acknowledge fully the extent of the effects of the GATT deal on Irish agriculture. Can any Minister for Agriculture stand over a proposal to force Ireland to cut its volume of exports of beef to non-EC countries by the equivalent of up to 100,000 cattle per annum? What will happen to the surplus? As Deputy Yates asked last night, where will all the unwanted stock go? These are the crucial questions that must be asked. We all know that the result will be to force down prices in Ireland and ultimately there will be no future whatsoever for the Irish beef industry.
Dairy producers face a 5 per cent cut in the national milk quota. This is caused by increased import excess and a cut in export volume. We are particularly vulnerable to a cut in export refunds because of our high dependency on non-EC markets. The cheese industry will be particularly affected by these cuts, causing a disastrous effect on employment, mostly in rural areas where there will be no hope of a replacement industry. I am thinking of small industries in my constituency, such as the Mullinahone Co-op where the cheese plant employs 135 people in the Slieveardagh area. At present unemployment levels in that area are way above the national average. Any deal or proposal that will affect small local industries such as this will have a disastrous consequence for the entire locality. This simple local example outlines the real and unwanted consequences of the GATT proposals.
On a personal level I have an interest in the cereal sector. GATT demands a 21 per cent reduction in the volume of cereals exported. The present set aside programme, starting this season, is causing severe stress to tillage farmers who understandably cannot cope with leaving any of their land uncultivated. It is an attack on their way of life and an assault on their tradition. It conflicts with their work ethic which is to utilise to the maximum all of their land. I might add that the set aside programme at present is in a state of confusion. When will cereal farmers receive compensation payments? Will they have to wait months as is the case with other supports from the EC? If so, profit margins will be further reduced in a sector where they are already too low. Not only will these farmers have to cope with a 15 per cent set aside programme this year, but they are also faced with the threat that the figure by which exports will be reduced will increase to 30 per cent. The Minister must come clean and outline the effects of those proposals on the cereal sector.
The cereal sector will also have to cope with a major market loss in compound feed demand due to reduced beef, milk and pigmeat production. This briefly outlines the severe consequences of the GATT deal, but even worse is that any cuts in support and protection negotiated under GATT are irreversible. This is why Irish farmers and the future of our agriculture must be protected. We cannot and must not allow the US to dictate our future. The whole idea behind GATT is to scale down the heavily subsidised agricultural reforms in both the US and Europe and to expand free trade. The US went into the GATT round adopting a very high moral tone against the EC Common Agricultural Policy. At one stage President Bush described Common Agricultural Policy as the iron curtain of protectionism. With its bulging food mountains it is to our loss that the EC found it difficult to shake off those attacks and found itself on the defensive. The Government must play its role and must do so now. We must clearly support France, Belgium and those who do not accept the MacSharry view that the GATT deal does not go beyond the Common Agricultural Policy cuts. Our stand and the stand of the Government must be to ensure no GATT cuts in excess of Common Agricultural Policy reform.
We cannot just sit and wait to see what will happen. The future of Irish agriculture depends heavily on the attitude, determination and action of the Government to forcefully resist the present GATT proposals and at a minimum to ensure full compensation. Ireland must simply take its fair share of cuts. Under no circumstances must it carry the can for other countries who are creating major surpluses, which are the cause of this crisis. Failure of the Government to protect Irish agriculture and secure its future will be dearly paid for by massive unemployment, an exodus of farmers from the land and the death of our rural communities.
I thank Deputy Ahearn for sharing her time with me. I join with the good wishes to the Leas-Cheann Comhairle on his appointment. I hope we will get along amicably.
I am delighted to have the opportunity to make a brief contribution to this very importrant legislation. I congratulate Deputy Yates for raising this matter. The present position in relation to the GATTEC talks comes as no surprise to me or to the farmers and rural organisations, from all of whom I have had correspondence. There has been no real commitment in this regard from this Government, the previous Fianna Fáil Government, or the Government previous to that which was in office when I first came into this House. That truth came home to me after I entered this House in 1987 when an application to have all of Cavan and Monaghan declared severely handicapped was withdrawn by the Government.
Shocking.
That application has not been resubmitted since. This brought home to me the truth that Fianna Fáil has no contribution to make to farmers. The Coalition Government between Fianna Fáil and the Progressive Democrats brought nothing but promises. I will not fault the Minister, Deputy Walsh, as he is still relatively new to the post but I expect much more from him, as do the people outside this House. The Minister promised that all headage payments would be paid in the calendar year, but that has not been done. Perhaps the Minister will tell me the reason for that. There are many farmers whose bank managers and creditors are knocking on their doors looking for money. They were told they would be paid by Christmas but through no fault of farmers they could not do so because the Minister did not deliver the cheques.
Where is the Labour Party tonight, the people who were to change the whole face of politics? We are discussing the most important industry in this country, yet there is not a Labour Member in the House. They do not care a straw about it. I know where they are. They are probably out looking for more jobs for family members. Many farmers are losing their jobs; the basis of their income is gone because of the policies pursued by the present and previous Governments. The EC debates were not properly negotiated. No real effort was made for farmers, many of whom said to me, "God be with the days when we had Mark Clinton and Austin Deasy to fight our corner". We expect the Minister to do the same. We have only to look around the country to see the commitment to agriculture. Agriculture is a sour word in this Government's mouth. They do not want to hear about it. Afforestation is now the big deal. On my way to Sligo on Monday for a very important regional meeting I saw one farm after another wholly planted. As these trees grow, other farmers will be pushed out. Afforestation is the buzz word. The Minister, titled Minister for Agriculture, Food and Forestry, should have the title Minister for Forestry, Agriculture and Food because forestry is being promoted primarily. There is no future in afforestation, in planting good arable land.
I acknowledge and appreciate the presence of Deputy Leonard from my own constituency whose commitment to agriculture goes without saying. I ask him to urge the Minister to renegotiate the GATT deal which will have such a devastating effect on the development of agriculture. Whether or not the Government like it, we have an agriculturally based economy. Our very existence depends on a thriving agricultural industry, but this industry is being slowly decimated and farmers are being pushed out.
I am alarmed by the deficiency payments in the GATT green box. Do people fully realise what this means and what the consequences of this are? The objective of the Common Agricultural Policy was that there would be common prices throughout Europe. We are not yet near catching up with our European counterparts in relation to the prices they achieve, and there is no denying that fact. Figures presented to the Government last Monday in Sligo in relation to the Structural Fund showed that the income of farmers in the north-west is less than half that of the rest of the country. I am sure the Minister is aware of these figures. The average farm income in 1991 in the north-west, including Donegal, Sligo, Leitrim, Cavan and Monaghan, not to talk of Mayo and Galway, was £2,400 per annum. How could any farmer rear a family in this day and age on £2,500, £44 or £45 a week? The social welfare officer would say those people are well off and are not entitled to assistance. In the rest of the country the average farm income of £5,400 is nothing to shout about. I was amazed at this figure. People in urban areas believe that these farmers, on £108 a week are well off. They call for them to be taxed and the Government supports them, believing they are not paying their fair share.
What does the green box mean? That proposal means that wealthier states such as America — although figures published last night show they have debts of billions of dollars, so there is no great wealth but apparently borrowing continues — and the wealthier EC states, such as Germany and France, will be allowed to subsidise their own farmers. Can we afford to do that? Of course, we cannot afford to do it. We are dependent on support prices from the EC. The consequences of the green box payments are that prices are floated in the marketplace. If the price is reasonable and will give a profit, that is grand; but if it has to be subsidised directly by member states that is another question. How can our farmers take less than a profitable price for the goods they produce? Commonsense must apply. This measure has serious consequences.
In my region the movement of quotas, such as they are, to the south must be stopped. The only hope for our farmers is the dairy industry, but this industry is being gradually eroded. We were told that under the Common Agricultural Policy there would be no movement of quotas. Farmers in the beef sector also find it difficult to exist. As regard to the cheque in the post, we must be the good boys of the EC. Every letter of the law must be abided by and if the farmer makes a mistake, he is denied subsidies and grants for two or three years. I will give an example in my area where a mistake was made. I am not blaming the Department officials — people can make mistakes and I accept that — but it is wrong for officials to set themselves up as judge and jury of a farmer who makes a mistake and to penalise him in an unacceptable manner.
In this instance the Department paid out cheques on the double. The money was very welcome and people thought this must be the EC bonanza that was promised, but a letter followed shortly aferwards stating that there was overpayment and that the cheques should be returned immediately. Needless to say money coming into any household with a family is used to pay bills and buy extra goods which are necessary. This money was not spent wilfully or thrown around, but the cheques were demanded back. I wonder would the officials who made those mistakes lose their salaries for, say, the next two or three years? Not at all. A mistake made by a farmer is treated differently. If a farmer makes a mistake the Government believes he is out to do it, but that is a wrong attitude and it must be changed. We should not be so miserly with farmers who may experience difficulty in compiling herd numbers. Where a genuine mistake is made people should be level-headed enough to say they understand, and if the herd numbers are all right farmers should get their grants.
I will give another instance of this Government's attitude to farmers and of driving farmers off the land. This matter has come to light in the last month and it relates to the whole question of pollution control. Neither I nor anybody else condones pollution. If there is pollution control there should be grant-aid to support farmers in tackling the problem. But what is happening at present? The fishery boards are using the Air Corps, an arm of the Army that was set up to protect the people, to spy and harass farmers in my constituency. This is not good enough and it will not be tolerated. It is unacceptable. How dare these people come in and frighten stock and people in their households? Farmers go about their business, trying to earn their livelihood above the law. These people are not breaking the law, they are not criminals. The Air Corps should be used to chase criminals along the Border and people who commit foul deeds. How dare anybody categorise the farmers in my constituency in that class? I will not accept it and I know the Minister would not accept it. He cannot be aware of everything that is happening but I bring this matter to his attention in the hope that he will have it dealt with.
Democratic Left intends to abstain on this motion because, while we support reform of the Common Agricultueral Policy, we recognise it is only one step in the right direction. I have heard many Deputies argue the case for the status quo and that is understandable. The case for the bigger farmer always has been well represented in this Chamber, but I agree that there should be no further concessions from the US in view of the new administration there.
In view of the great North-South divide, we should be considering a global view of the GATT deal. The purpose of GATT is to end protectionist trade barriers and distortions, particularly as they relate to agricultural commodities, a necessary prerequisite for economic recovery in developing parts of the world. The payment of EC export subsidies and the systematic restriction of access to EC markets is deeply unfair to the many Third World countries struggling to develop their farming sectors. The purpose of trade liberalisation must be to try to bridge the huge gap between North and South. The Irish debate regarding GATT has focused almost exclusively on its possible effects on Irish agriculture and how it related to the Common Agricultural Policy reform proposals. We must face up to our global responsibilities even if this means a certain adjustment in farming patterns in Ireland.
The GATT and some of the proposals regarding the multilateral trade organisation are flawed in many ways, but unless there are some steps taken towards the dismantling of trade barriers there is little chance of sustainable development in a way that meets the needs of the present without compromising the ability of future generations to meet their own needs. Even at this late stage there is room to amend the proposals so that the MTO becomes a body able to support environmentally sustainable economic development. With this in mind we call on the Minister responsible for foreign trade, Deputy McCreevy, to press for this condition to be written into the preamble and articles of the MTO proposal.
The principal cause of distortions in the world agricultural system relates to the payment of export subsidies in the rich countries of the north. There is an incentive to produce massive quantities of food which are dumped onto world markets. The GATT proposal to reduce the volume eligible for subsidisation is a step in the right direction and the EC should support this proposal. However, more radical measures are needed which would ultimately lead to a ban on export subsidisation, together with the banning of the marketing of agricultural produce on world markets at prices below the cost of production. This would obviously raise the cost of food imports for developing countries who already face a severe squeeze on their balance of payments, thereby threatening the security of their citizens in terms of food. In the long term these countries will have to become more self-sufficient in food but in the short and medium term a realistic programme of adjustment support, in some cases for a greater timespan than the ten years underlined by GATT, will be required.
The EC in particular must be prepared to step up its developmental assistance to allow Third World countries to develop viable national agricultural sectors. A too speedy move towards trade liberalisation in the South would help only the rich countries. Of paramount concern must be the provision of food security to the poorer nations. Therefore, a distinction must be made between subsidies which sustain over-production and distort world markets and subsidies used for rural employment and to promote ecologically sustainable agriculture. A more prosperous South, with a substantially alleviated debt burden is in all our interests.
Apart from the inadequacy of some of the proposals of the GATT deal itself, the whole approach of GATT is too narrowly focused. Whatever follows from GATT must embrace the question of global economic development. It is not sufficient to deal with international trade policy in isolation from broader economic considerations. The successor to GATT must have among its founding objectives technological transfer of developing countries and the control of transnational corporations.
The Fine Gael motion seeks to oppose the GATT deal on the basis that it goes beyond what has been already agreed in the Common Agricultural Policy reform proposals. One suspects, however, that lurking behind this is an antipathy to the practical consequences of having to live with Common Agricultural Policy reform. It has been obvious for some time that the writing is on the wall for the Common Agricultural Policy. There has been plenty of time for successive Governments and the main farming organisations to prepare themselves for the inevitability of reform and to seek alternative structures for agriculture and rural development. At least Common Agricultural Policy reform goes some way towards the undoing of a system which proved to be ruinously wasteful as well as having a pernicious effect on the world agricultural system.
We have been living with a policy which produces goods for which there is no market, which adds up to £15 per week to consumer food bills, which consumes up to 60 per cent of the entire budget and which allows 80 per cent of all price supports to go to the top 20 per cent income bracket. This policy does not have a future and is not worth fighting for. It is clear that Common Agricultural Policy contributed to the uneven development of Irish agriculture and is equally clear that the promised benefits to the whole country never materialised. After two decades of EC membership the agriculture sector's net contribution to the Common Agricultural Policy remains unchanged. The numbers obtaining a living from farming have declined by 40 per cent and the number at work in the food industry has declined by nearly one-third — from 46,000 to 33,000. The Common Agricultural Policy has acted as a transfer of wealth from smaller farmers, consumers and taxpayers to larger, wealthy farmers. It does this because price support mechanisms benefit farmers who already have a large output.
The NESC in a document, The Impact of Reform on the Common Agricultural Policy, argued that, from an Irish perspective, Common Agricultural Policy reform is desirable as well as inevitable. Firstly, a viable and sustainable framework for agricultural production is of strategic importance to the performance of the Irish economy. Secondly, a reformulated Common Agricultural Policy could address more effectively the structural problems of Irish agriculture, including the problem of low and volatile incomes. Thirdly, a reorientation of policy measures could contribute to the development of the food industry, especially if it reduces the current seasonal pattern of production. Fourthly, the distribution of resources from the Community's budget is quite uneven, with Irish producers receiving significantly lower levels of support than their more intensive and more economically developed counterparts in other countries. The document concludes that a reorientation of support measures could strengthen the cohesive impact of Community agricultural expenditure.
We believe that price support mechanisms should be dismantled over a phased period in the context of international GATT negotiations. This would create a liberalised agricultural market which relies more on the market to establish prices than on artificial price-fixing mechanisms. The funds Ireland at present obtains in export subsidies could be redirected to direct income support, structural improvement and a serious programme of integrated rural development. It is important to emphasise that the problems of Irish agriculture are primarily structural and it is the function not only of the EC but of the Irish State to tackle these problems.
Deputy Yates has kindly agreed to allocate me five minutes of his time, which I appreciate. I wish to deal with some of the issues raised by the last speaker. Fine Gael is extremely concerned about the GATT proposals as they are currently framed and their implications for the Third World. I am anxious to alert the Minister opposite and indeed his partner in Government, Deputy McCreevy, the Minister responsible for the final decisions in relation to GATT and the signing of any treaty or introduction of legislation in this regard, to a number of matters which are of great concern. I call on the Minister to proceed very slowly bearing in mind that in December 1992 Arthur Dunkel produced a draft final Act which embodies the results of the Uruguay Round.
In the context of that draft there are very significant proposals, which were touched on by the last speaker, for a new and powerful multilateral trade organisation. These proposals, which could have very far-reaching significance for us as a small nation and for the countries of the developing world have received no attention. We could serve our own interests, by very carefully watching this development, by seeking to achieve as much as possible in relation to the GATT proposals and particularly by trying to ensure that the proposal for a new international body is reversed. Such a body would have a marked impact on the right of national Governments to decide upon and employ trade policy measures. While there is need for new institutional arrangements the proposals as they stand are seriously flawed in that such a body would have great effect on settling disputes over trade and the criteria by which the validity of trade policy measures are judged.
Most importantly it is proposed that free trade would be an absolute goal of any policy in this regard. Given our known concern for the Third World, particularly for Africa which is suffering at an unprecedented level, the position in relation to trade undermines the vast aid given by the western world. We are net beneficiaries from the economies of that region. That is a horrific reality that any negotiator from a Christian and Catholic society should never turn their back on.
I am concerned that there is absolutely no commitment to environmental issues in the context of the draft Bill published in December. I am concerned that the proposed governing body of the multilateral trade organisation would be similar to ministerial conference, that the new dispute settlement procedure that is suggested would be even more inadequate than the previous one which was untransparent, taking place behind closed doors, where nobody could query proposals until the result was delivered and no means of satisfying ourselves on matters. It effectively further diluted the lines of democratic control in nation states. This is a matter about which we should be greatly concerned. Together with other Governments we are under increased pressure to promote the environment, to create and maintain employment and improve standards of living as well as seeking free trade, all valid objectives for us and our partners in the Third World.
These proposals would reduce direct national control over vital economic matters. Unlike the original 1947 GATT proposal this new proposal makes no provision to address the international commodity crisis, control restrictive business practices or protect labour rights. Matters such as protection of the environment and fair trade rules for the Third World are essential in considering the GATT proposals. I would ask the Minister present and Deputy McCreevy to seek to have this proposal in relation to the multilateral treaty put aside until we have a clear and explicit commitment to protect the environment, to promote sustainable development and to raise the incomes of the poor in the Third World. We should ensure that for countries such as Ireland direct control over decisions would be made by a club of two or three of the richest nations in the world. It is in our interests as well as those of the Third World, to examine this proposal, to raise questions about it at every level and to ensure that it does not go ahead as currently proposed.
I congratulate you, a Leas-Cheann Comhairle, on your recent election to that office and wish you a successful and enjoyable period there.
Thank you, Deputy.
I thank all the Deputies who contributed to this well informed debate. My first criticism is not of the Minister; it is that in all organs of the media today there was not one line about this debate. On the 6 o'clock news today there was fanfare about 2,000 jobs, and rightly so. There will be 20,000 jobs at issue if this GATT deal goes through as it is currently proposed. Yet the matter is regarded as a big yawn by the public and the media. Because it will not immediately impact on people, they do not understand the gravity of the matter, and I very much regret that. There is a great responsibility on the Minister and the Government to lead in this regard. If the Government is seen to be deeply agitated and anxious about the GATT proposals, the country will realise it is a major national issue. Together with the unemployed budgetary issue and the unemployment crisis, this is a major issue and it must be preceived as such, not just by the Minister but the Taoiseach and the Tánaiste.
I will deal first with the Minister's comments because at the end of the day the steps taken on this issue will be most important. Disregarding the points made by the Minister last night on analysis of the proposals, the bottom line is his statement, and I quote: "I have made it crystal clear to our European partners that I will not accept an outcome which goes beyond Common Agricultural Policy reform parameters unless such an outcome is accompanied by firm commitments that our vital national interests will be protected in the further measures that will be necessary." In his speech tonight the Minister of State said that the Minister and his officials will make every effort to ensure what is eventually agreed can be contained within the outcome of Common Agricultural Policy reform or, if not, that we get firm commitments that our vital national interests be protected. What does that mean? Does it mean a 4 per cent cut in our national quota, or does it mean 100,000 cattle are to be sacrificed? We need to take a far more aggressive line on this matter. Deputy McManus was right in that lurking behind this motion on GATT and Common Agricultural Policy reform is that instead of having parishes with 30 or 40 family farms there will be only two ranchers. We are talking about the annihilation and depopulation of rural Ireland. I make no apologies for saying that a line has been drawn in terms of Common Agricultural Policy reform — that is not something to which I would have willingly agreed — and beyond that line we cannot go.
As regards beef, the level of production in excess of consumption is in the order of one million tonnes per annum. Therefore problems will arise in the event of a reduction in intervention to 350,000 tonnes? Excess beef will not go to third countries because import refunds will be reduced by 36 per cent between now and 1999. The Minister of State rightly pointed out that we are heading for a crash in heifer meat prices, for which there is no intervention ceiling for 1994, because there is no market for this meat. The inevitable conclusion is the systematic slaughter of calves at ten days old in return for a premium of £88. That will result in a loss of jobs in the food processing sectors and the introduction of intervention for cattle weighing 150 kilos, which is totally unacceptable.
In the dairy sector, the New Zealand dairy board is jumping up and down with excitement at this proposal because they are selling milk at 40p a gallon and making a profit of 17p a gallon. If we cut back our national quota by 5 per cent, particularly in relation to cheese exports, where will the compensation come from? It has been acknowledged in this debate that during the Edinburgh Summit a budgetary ceiling was set for the Common Agricultural Policy. Therefore there is no windfall of money to bail us out. That brings me to my central disagreement with the Government. It believes that somehow after all the negotiations are over Ireland will fix it because of our vital national interest, but I do not believe that is possible. For example, we produce 1 per cent of the EC's pigmeat; but if there is a surplus as a result of increased imports of, say, 400,000 tonnes, we will probably contribute 20 per cent of the surplus. Countries who contribute to the surplus and who depend on intervention will pay the price. Why are we so dependent on intervention? It is not because we export 80 per cent of our agricultureal produce but because intervention is triggered where the price is lowest, and the price for virtually every commodity is lowest in Ireland; thus our dependence on intervention. Countries who depend on intervention will be devastated, and that is where we stand to lose. We must insist that any cuts in production are made in proportion to total production levels, not to the excess. That is a fundamental point that must be borne in mind.
As we move towards dismantling a Common Agricultural policy with common prices and a common income, there will be a rationalisation of agriculture. That means that Germany, only 2 per cent of whose population is involved in farming — in Ireland 17 per cent of employment is in the agricultural sector — will be able, as an industrialised economy, to afford major supports by way of direct income aids to their farmers. We do not have that option. The Minister of State said that would not be allowed, but Germany could provide support by way of VAT refunds. This is a national crisis that must be tackled on the basis of the survival of family farms. Deputy Boylan rightly said that the average farm income is well below the industrial average wage. There is a saying that the only way young eligible farmers can make a living is to marry what is called a laying hen, preferably somebody in the public sector such as a doctor, nurse or teacher who could sustain them. With present Government and EC policy there is no way these people will be able to afford to rear their families based on agriculture.
Fine Gael will be presenting our motion. We will not oppose the Government Amendment because we support a tough line. Arising from this debate, I want to see a strengthening of the Minister's resolve and an up-take of this matter by the Taoiseach and by the Tánaiste and Minister for Foreign Affairs. A line has been drawn in the sand beyond which we cannot and will not go.
Amendment put.
The Dáil divided: Tá, 79; Níl, 44.
Tá
- Ahern, Michael.
- Ahern, Noel.
- Bell, Michael.
- Bree, Declan.
- Brennan, Matt.
- Brennan, Séamus.
- Briscoe, Ben.
- Broughan, Tommy.
- Browne, John (Wexford).
- Byrne, Hugh.
- Callely, Ivor.
- Collins, Gerard.
- Connolly, Ger.
- Costello, Joe.
- Coughlan, Mary.
- Cowen, Brian.
- Davern, Noel.
- Dempsey, Noel.
- de Valera, Síle.
- Doherty, Seán.
- Ellis, John.
- Ferris, Michael.
- Fitzgerald, Brian.
- Fitzgerald, Eithne.
- Fitzgerald, Liam.
- Flood, Chris.
- Foley, Denis.
- Gallagher, Pat the Cope.
- Geoghegan-Quinn, Máire.
- Haughey, Seáan.
- Hilliard, Colm M.
- Hughes, Séamus.
- Jacob, Joe.
- Kavanagh, Liam
- Smith, Brendan.
- Smith, Michael.
- Spring, Dick.
- Stagg, Emmet.
- Taylor, Mervyn.
- Kemmy, Jim.
- Kenneally, Brendan.
- Kenny, Seán.
- Killeen, Tony.
- Kirk, Séamus.
- Kitt, Michael P.
- Kitt, Tom.
- Lawlor, Liam.
- Lenihan, Brian.
- Leonard, Jimmy.
- McCreevy, Charlie.
- McDaid, James.
- McDowell, Derek.
- Moffatt, Tom.
- Morley, P.J.
- Moynihan, Donal.
- Moynihan-Cronin, Breeda.
- Noonan, Michael (Limerick West).
- O'Dea, Willie.
- O'Donoghue, John.
- O'Hanlon, Rory.
- O'Keeffe, Batt.
- O'Leary, John.
- O'Rourke, Mary.
- O'Shea, Brian.
- O'Sullivan, Gerry.
- O'Sullivan, Toddy.
- Pattison, Séamus.
- Penrose, William.
- Reynolds, Albert.
- Ryan, Eoin.
- Ryan, John.
- Ryan, Seán.
- Shortall, Róisín.
- Treacy, Noel.
- Upton, Pat.
- Wallace, Dan.
- Wallace, Mary.
- Walsh, Eamon.
- Walsh, Joe.
Níl
- Ahearn, Theresa.
- Barrett, Seán.
- Barry, Peter.
- Boylan, Andrew.
- Bradford, Paul.
- Browne, John (Carlow-Kilkenny).
- Clohessy, Peadar.
- Connaughton, Paul.
- Connor, John.
- Cox, Pat.
- Crawford, Seymour.
- Creed, Michael.
- Crowley, Frank.
- Cullen, Martin.
- Currie, Austin.
- Deasy, Austin.
- Doyle, Avril.
- Dukes, Alan M.
- Durkan, Bernard J.
- Finucane, Michael.
- Fitzgerald, Frances.
- Flaherty, Mary.
- Foxe, Tom.
- Harney, Mary.
- Harte, Paddy.
- Higgins, Jim.
- Hogan, Philip.
- Kenny, Enda.
- Keogh, Helen.
- Lowry, Michael.
- McCormack, Pádraic.
- McDowell, Michael.
- McGahon, Brendan.
- McGinley, Dinny.
- Molloy, Robert.
- Nealon, Ted.
- O'Donnell, Liz.
- O'Keeffe, Jim.
- O'Malley, Desmond J.
- Owen, Nora.
- Quill, Máirín.
- Sheehan, P.J.
- Timmins, Godfrey.
- Yates, Ivan.
Tellers: Tá, Deputies Dempsey and Ferris; Níl, Deputies E. Kenny and Keogh.
Amendment declared carried.
Motion, as amended, agreed to.