Vol. 426 No. 7
10 Ms McManus asked the Minister for Agriculture, Food and Forestry if he intends to ensure that the gap between the larger subsidy paid for the export of live cattle and the smaller subsidy paid for killing and processing the animals in Ireland will be eliminated thereby helping to save jobs.
56 Mr. Yates asked the Minister for Agriculture, Food and Forestry if the special spring slaughter premium on cattle will be available for cattle exported live outside the EC during the same time of year; the steps, if any, he is taking to ensure this.
I propose to take Questions Nos. 10 and 56 together.
The deseasonalisation slaughter premium which was negotiated as part of the Common Agricultural Policy reform agreement is designed to encourage a more even slaughtering pattern throughout the year, which is essential for marketing purposes. The premium is payable on eligible animals slaughtered in Ireland in the period 1 January to 30 April 1993. It is not payable on animals exported live. However, the EC Commission recently increased the export refunds payable on live exports to certain Third Country destinations until 30 April 1993.
My overall objective is to ensure fair competition so that a proper balance is struck between providing producers with reasonable returns and providing processors with the supplies they need to sustain and develop trade in value-added products. The improvement in the structure of the beef processing industry to ensure that as much as possible of its value-added production takes place in Ireland is an important policy aim. I am satisfied that adequate supplies are available to meet our present processing needs. However, I am monitoring developments closely to ensure that there are no trade distortions.
Will the Minister accept that there is a gross anomaly in relation to the export refund scheme under which producers are encouraged to export animals live rather than having them processed at home? He stated that there is a policy aim in relation to processing at home which forms part of the Joint Programme for Government. Nothing in his reply indicates how he intends to proceed to ensure that that happens. Is the Minister also aware that serious concern has been expressed by IBEC that the IDA policy in relation to this overall matter is also very specific? Is he aware that there are expressions of grave concern in relation to job creation? How does he intend to realise the aim which, obviously, he supports?
At present there is an expert group sitting within my Department considering this matter, which is to report within the next month or two, advancing a proposal for the expansion of the food processing industry disseminated from the Culliton report on through the Programme for Economic and Social Progress agreement. When that report is available it will be referred to the social partners. However, the Minister for Agriculture, Food and Forestry has already stated — and I reiterate that assurance — that it will not be delayed in the Department. Obviously, the optimum aim is that no beast leaves the country without going to a factory to be processed, and that we benefit from the added-value and the job creation arising therefrom. The present dilemma is reflected in the two questions which have been tabled. Deputy Yates's question relates to the premium being extended to cattle which go outside the Community whereas Deputy McManus dealt with the retention of sufficient stocks. There is no problem in terms of supply, we are continuing to monitor the position to ensure supply and, at the same time, a proper return to producers. At the end of the day our aim is to encourage competition in the market, ensuring returns for producers, but having as much processing as possible of our national herd.
Will the Minister agree that while, superficially, IBEC and Deputy McManus have a point about maximising jobs, if one looks at the position, one will observe that the only buoyancy in cattle and beef prices has been as a result of the reintroduction of live exports? Beef processors said, when MCAs were to be abolished, there would be a cut of 12p a pound in beef, this reduction did not materialise not because MCAs were not abolished — they were — but because of live exports. Will the Minister of State agree that it is essential that farmers, producers, and all the economic spending they generate, means they are entitled to a fair return on their beef and that the best method of ensuring this is to have some level of decent export refunds such as is now in place?
I agree with Deputy Yates that it is vital for the producers to get a proper return. Indeed the fact that live exports are taking place once again shows us clearly the value of competition. The Deputy will appreciate the dilemma to which I referred earlier that we have to get the balance right. When there is distortion of trade the Department and the Minister must move at Community level to have it put right.
Will the Minister agree that if the gap between the subsidy for live cattle and slaughtered animals is to be narrowed the subsidy on live exports should be reduced? Will the Minister further agree that it is only when we have a good live export trade that our factories see fit to give farmers a decent price for their animals?
Current comparison figures would be £53 at the factory and £38 on export refunds. Obviously — I reiterate this — we must cater for the producer. In the context of the producer, competition is very important. On the other hand, we must ensure that every development is made in the food processing industry and that there is a resultant increase in employment, something to which all Members in this House are committed. In the context of the expert group report which is due, we hope to make strides in that regard this year.
While acknowledging the agreed need for competition between the live export trade and the factories, will the Minister agree that millions of pounds have been given by way of grants to meat factories but that instead of real added value all that has happened to date — with few exceptions — is that the workers cut the heads and tails off the animals, freeze them and export them in their raw state?
Obviously, we seek to have the highest level of added value applied to the industry. Since I became Minister of State in the Department it has become clear that we must aim for upmarket goods and sophistication in terms of products. The Government is concerned to do everything possible to ensure that — as I said in an earlier reply — we get the maximum number of jobs from the food processing industry and, with particular reference to this question, from the beef processing industry.
Will the Minister agree that the balance he seeks between the needs of producers, workers and potential workers has not been evident so far? This is one example. Will he guarantee that, in relation to this report and whatever procedure takes place after that, the full potential for job creation will be realised in the whole field of agriculture?
The present position seems to indicate that the live cattle export trade has orders for 80,000 animals. At present, there is a sufficient supply to the existing meat processing factories and we do not have the problem to which the Deputy alludes. On the other hand we have to broaden the base of this industry. I can give a commitment that both partners in Government will be pushing that issue as quickly and as effectively as possible.
In relation to the spring slaughter premium, I would like to bring to the Minister's attention that many people processing for the home market who are approved under the Abattoirs licence are not eligible for the spring slaughter premium because they do not have an export licence. A number of cases in that regard have been brought to my attention and to that of the Department in recent weeks. As these are bona fide steers slaughtered in the country will the Minister ensure that the slaughter premium will be made available to those abattoirs who have the highest hygiene standards etc., and licensed under the Abattoirs Act?
I thank Deputy Yates for raising that matter. I visited such a plant last Monday which provides for the home market. They are making a detailed submission to me and we will deal with it promptly when it arrives.
