(Wexford): I wish to share my time with Deputy Tom Foxe.
Private Members' Business. - Sheepmeat Sector: Motion (Resumed).
The following motion was moved by Deputy Cowen on Tuesday, 7 November 1995:
That Dáil Éireann, acknowledging the crisis in the Irish sheep sector and mindful of the many thousands of jobs on farms and in factories dependent on the industry, condemns the Government and the Minister for Agriculture, Food and Forestry for the sustained indifference they have demonstrated to the needs of the industry and hereby calls for urgent steps to be taken to address both the immediate crisis and the long-term structural problems of the Irish sheep sector.
Debate resumed on amendment No. 1:
To delete all words after "That" and substitute the following:
Dáil Éireann endorses the effective measures which have already been taken by the Minister for Agriculture, Food and Forestry to address the difficulties which have been experienced by sheep producers this year and commends the intensive efforts by the Minister at the Council of Agriculture Ministers to secure further support for the sector.
—(Minister for Agriculture, Food and Forestry.)
Is that agreed? Agreed.
(Wexford): Having attended public meetings in my constituency where I come in contact with farmers almost on a daily basis, I am very much aware of the serious problems confronting sheep farmers, particularly in the lowlands. I am not sure if the same could be said of the Minister for Agriculture, Food and Forestry, Deputy Yates, or his Minister of State, Deputy Deenihan, as little action has been taken in recent months. Sheep prices also collapsed in 1992 when I was Minister of State at the Department of Agriculture, Food and Forestry, but the difference is that the then Minister, Deputy Joe Walsh, recognised the enormity of the problem and secured a top-up payment of £6 per ewe to ease the burden.
According to the Minister, sheep prices have fallen by 6 per cent this year. They have fallen dramatically since March, this at a time when incomes in every other sector of agriculture have increased substantially. Sheep farmers in my constituency, which I share with the Minister, are up in arms. They are frustrated and disillusioned and many, including some of the Minister's supporters, no longer see a future for themselves and their families in sheep production.
Prices rose in October, but this was too little too late for many sheep farmers who were forced to sell their stock early in the year at prices as low as 93p per pound. The Minister, who is surrounded by an American style PR team, has lost the common touch. He does not seem to realise that the sheep sector faces a major crisis.
What did the Deputy do about it?
(Wexford): It would be far better if the Deputy showed more concern for the plight of sheep farmers rather than engaging in a slagging match across the floor of the House.
Hypocrisy.
(Wexford): He should do something productive and vote with the Fianna Fáil Party at 8.30 p.m.
The Minister should seriously consider the request made by the IFA for the extension of the rural world premium, a single method of calculation of ewe premium, a top-up payment of £8 per ewe or, alternatively, a permanent top-up mechanism. On the question of carcass reclassification, what is the current position? Although there has been much talk about the need for quality the Minister has not delivered on his promise to date.
Were it not for the efforts of the Wexford branch of the IFA, sheep farmers would have been abandoned long ago not only by the Minister, but also by the IFA at national level. The Wexford branch deserves great credit. It has been a lone voice on behalf of sheep farmers, particularly in the lowlands. I think the message is beginning to get through. We will offer the Minister our full support in his attempts to secure a top-up payment of £8 and the extension of the rural world premium.
I wish to share my time with Deputy Mildred Fox.
Acting Chairman
Is that agreed? Agreed.
In the mid-1950s when people worked a half-day on Saturdays, the price of a pound of wool was ten shillings, the equivalent of one-eighth of the average weekly wage of £4. Last year it was 18p with which one could buy less than one and a half cigarettes at a cost of 14p each. It cost £2 to have a sheep sheared. All the farmer gained in return was £1.30 approximately, which meant he was losing 70p per sheep. This is an indication that the bottom has fallen out of the market.
In 1988, according to the figures produced by Teagasc, a farmer made a profit of £35 per ewe. By 1994 this figure had fallen to £22 or by 35 per cent. This is an indication that the bottom has also fallen out of the lamb market.
This issue is of importance to the sheep farmers of Wicklow and east Kildare. I wish to emphasise three main points. A top-up payment of £8 per ewe would make all the difference to many sheep farmers, who will either sink or swim depending on whether it is paid. It would, however, only be a short-term solution. The Minister should press for the introduction of a single method of calculation. As there is no price convergence throughout Europe, in the words of George Orwell "some are more equal than others". The increase in the volume of New Zealand lamb imports has had a detrimental effect on the Irish sheep sector. It needs to be drastically reduced. We should not allow ourselves to be sold out in this manner.
I wish to share my time with a number of Government Deputies.
Acting Chairman
Is that agreed? Agreed. The time to be shared is 30 minutes.
I never thought I would speak on the crisis in the sheep market, given that I represent part of Cork city which is severely disadvantaged but one subject on which it does not face a crisis is the price of sheep. I was asked by the Whips' office if I would like to contribute to this debate. I said I would have to think about it and decided there was a connection between my area and the farming industry. The subject before us in overproduction in the sheep industry in the first part of 1995 and the rationalisation in the second half of the year. I decided if the matter concerned grants and intervention I should speak on it.
I am concerned that periodic crises in the agriculture sector such as currently experienced by sheep producers lead to further patching up and selective expansion of the Common Agricultural Policy. The cracks in the CAP will not be resolved by the "band-aid" approach. Despite our reservations about his departure to Europe the former Commissioner, Mr. MacSharry introduced some excellent reforms. However, there is still need for a root and branch overhaul of the CAP, which is fast becoming unwieldy, unsustainable and unworkable.
I categorically deny Fianna Fáil's assertion that this Government has failed to tackle the problem facing Irish sheep producers. With the average price of lamb falling by 6 per cent in the first half of this year because of over-production last year, sheep producers are facing a serious problem and they have my sympathy. The position was slightly alleviated in May when the Minister, Deputy Yates, successfully lobbied for the introduction of aid to the private storage scheme for the old season lamb, which was followed by a further scheme in June.
A hoax.
(Wexford): Well done. Did the Minister write Deputy Lynch's contribution?
This was the first time such a scheme was introduced for hoggets—I only discovered what they were today——
I think the Deputy made many discoveries today.
——and it sets an interesting precedent. I am sure Fianna Fáil finds it astonishing that I am being so truthful.
Do not venture into uncharted waters.
Honesty is a commodity in short supply on the other side of the House.
(Wexford): Deputy Lynch knows all about that.
The Minister has argued for a supplementary premium to be paid if market prices in any member state drop 10 per cent or more below the average EU price. Such a premium would undoubtedly alleviate many of the temporary hardships experienced by producers in the face of fluctuating prices.
However, it is on a wider level that I see the correlation between this sector and the area I represent. I am concerned that the periodic crises experienced by various agricultural sectors tend to result in patching-up and arbitrary expansion of what is already an unwieldy system of doubtful efficiency. Within the CAP framework this Government has succeeded in obtaining a good deal for Irish producers; the concessions obtained by the Minister in respect of sheep producers are just one example. However, there is a need for the CAP as a whole to be reviewed. The time is fast approaching when neither Irish nor European taxpayers — the people I represent — will be able to afford to subsidise the CAP unless it is subjected to a root and branch overhaul.
This year we are commemorating the famine; in August we witnessed 2.5 million tonnes of fruit and vegetables, produced at a cost of nearly £500 million in subsidies, being destroyed in an effort to artificially boost world prices. The scandal of set-aside allows farmers to claim an average of £3,292 in respect of land let fallow, a waste. These are only two examples of what can only be termed "mad CAP disease".
That is a well used phrase.
The CAP has fostered a culture of agricultural dependency. Is this too technical for Deputy Byrne?
Deputy Lynch knows nothing about this area.
I know something about taxation, about which Deputy Byrne knows little. Farmers now receive one-third of their income from various EU grants and perks——
——and they pay tax on it.
——and that proportion is steadily increasing. This year over £700 million in taxpayers' money will flow into farmers' pockets, and the figure is set to increase next year. The artificially high prices engendered by the CAP, with the subsidies needed to support the scheme, mean that householders in Ireland pay an average of £20 extra per week in higher food bills and taxes. A recent consultancy report for the European Commission recommended a radical reform of the CAP, yet Governments throughout Europe have put the issue on the political back burner for fear of offending powerful farming lobbies. Unless EU member states grasp the nettle of CAP reform, EU taxpayers may find themselves unable or unwilling to continue subsidising a policy which has gone out of control.
That is Government policy.
As a Member of the European Parliament in the early 1970s, I was on its agriculture committee and one of the few people on that committee who demanded, successfully, that the Parliament should accept a regime for sheepmeat, which was excluded from the other agricultural schemes. The then Minister for Agriculture and Fisheries, Mr. Mark Clinton, pressed for this through the Commission. It has continued since to bring the benefit of the European regime to the sheep farmers of Ireland.
It was of particular benefit to people from my county. I now represent the larger constituency of Wicklow-East Kildare and it is one of our main industries, especially in County Wicklow. The industry is worth £30 million and should be protected and defended. In upland Wicklow there is little alternative to sheep farming; the topography means there is little chance of moving into other agricultural activities. When an industry such as sheep farming is in trouble it rebounds severely on Wicklow.
The current Minister, assisted by his Minister of State, has probably been the most successful Minister in this area since Mr. Clinton. His work for other sectors is well recognised and he will not let Irish sheep farmers down. Nevertheless there is a problem and it would be foolish not to recognise it. We have a difficulty and the Minister is taking action in several areas, as mentioned by the previous speaker, and I commend him for that.
Whether it is imports from New Zealand or the difficulties last summer, where exports did not reach the expected levels, there is a problem. The Minister's aggressive style in European meetings will have raised the issues where they matter. We cannot do much in this House as regards agriculture; it is in the corridors of power in Brussels where changes must be made. Will the Minister continue to air the problems facing sheep farmers? The losses in that sector affect farmers who do not have an income from other sources. However, I recognise that the matter rests with Brussels and there is little we can do here.
I hope the Minister will keep a close eye on non-elected bodies taking over the uplands in my county to the detriment of farmers. I know he is aware of some of the difficulties and representations have been made to him but the demands made by the IFA on behalf of sheep farmers should be taken on board. The Minister will make the strongest possible case in Europe. I know he has successfully negotiated with the Commissioner on behalf of other sectors and I look forward to him improving the market for sheep producers.
I wish to share time with Deputies Theresa Ahearn, Hogan, Crawford and Boylan. It goes without saying that 1995 was a disastrous year for sheep farmers. In County Galway we depend largely on income from sheep. The sheep trade was somewhat better in the last three or four weeks due to the demand for good quality ewe lambs. I hope ewe lambs will be eligible for the ewe premium next year. However, as a result of the number of hoggets that might come on to the market in 1996 early lamb producers may not have it so good next year either.
Last July and August many farmers had to sell 27, 28 or 29 lb lambs and they did not make much money. I was involved on the periphery when the ewe premium scheme was negotiated in Brussels. It has stood Irish farmers very well and the trade would be scuttled without it. However, the mechanism used is the average price across Europe and as the Irish sheep price is worse than it is anywhere else it works against us. It must be adjusted and I know the Minister has spoken to the other Ministers of Agriculture who will not have the same domestic pressures when they attend the meeting in December because continental sheep farmers are not as badly off as the Irish. We need a top up premium but it must be organised quickly. If early lamb producers are forced out of the market, they will go back to mid and late season lambing and there will be a bigger lamb glut than ever. I have every confidence in the Minister and wish him the best of luck at the December meeting in Brussels.
I support my colleagues and endorse the sentiments expressed in urging the Minister to ensure the plight of the lowland sheep producer is recognised in future price negotiations. The Minister will have an opportunity at the meeting in December to use the number one priority he expressed at various farm Council meetings during the last few months and get some respite for the lowland sheep producer. He deserves the support of farm organisations.
Since coming to office he has sought a top up premium to be paid at the market price in any one member state when it dropped more than 10 per cent below the average EU price and an extension of the rural world premium. He set those objectives as far back as last May. We need a decision one way or the other now and I hope the Minister will not suffer the lapse of memory from which others suffered but will deliver the goods for the sheep producer.
The Minister for Agriculture, Food and Forestry set himself two targets when he was assigned the ministry of agriculture: he wanted to make the Department farmer friendly and he committed himself to being the farmers' representative. I challenge any Opposition Deputy to debate that he has not lived up to those commitments.
This debate could have been fruitful and useful but the tone of the Opposition sent a signal to Brussels that the crisis in sheep farming was caused by the Minister. The Opposition would have done a good job for sheep farmers if it sent a signal to Brussels expressing its deep concern. That would have strengthened the hand of the Minister at the negotiating table. I have full confidence in the Minister. He will debate the matter strenuously with a deep sense of sincerity and commitment since the sheep industry must be rescued. He demonstrated that in the summer when the steps he took stabilised the price of sheep. I have no doubt that the future of sheep farmers is in excellent hands.
I thank Fianna Fáil for raising this issue. Agriculture has not always been afforded the importance it deserves in the House. Sheep farmers especially have suffered not only throughout this year but in recent ones.
I found it strange that the main Fianna Fáil speakers tried to put across the case last evening that the problems of sheep farmers, and of farmers generally, had occurred as the present Minister assumed office. I might remind them that not until some lambs entered Agriculture House did the Minister's predecessor realise how serious was the then crisis. I would not have agreed with such action but it was a indication of the farmer's frustration.
The present disastrous position possibly has its roots in decisions taken in Brussels in 1989. Obviously, it had become more difficult to get a sympathetic hearing from the European Parliament or the Commission to have changes in our favour implemented. Nonetheless, I have no doubt that the present Minister will deliver the goods if at all possible and it will not be his fault if that is not the case.
I appreciate the frustration of sheep farmers, particularly in recent days, when the Minister did not give a categoric assurance that he would be able to guarantee the top-up they require. However it is better that the Minister and Government commit themselves to make the best possible efforts on our behalf in Brussels. I was a junior spokesperson on agriculture when in Opposition, and heard the Minister's predecessor, Deputy Joe Walsh, guarantee on 24 February 1994 that our pig farmers would be catered for immediately. We all know that, when he left office, nothing had happened.
I also remember that when I was in Opposition the port at Greenore was closed. I should like to avail of the opportunity of thanking the present occupant of the Chair for support in bringing this to the attention of the House. It was through such support that we managed to have the port reopened. I do not wish to take from some achievements of the Minister's predecessor but the suggestion that the present Minister has been an absolute failure because he has been unable to deliver on the sheep package is unfair.
I wish to comment on overall marketing. I spent seven years when I was involved with the Irish Farmers Association as a member of a meat and livestock board. There were then many opportunities but there was a dearth of Government funds.
Our budget on that statutory body was cut from £700,000 annually to £300,000. Did that indicate a commitment to the marketing of beef and lamb? The Minister has allocated millions of pounds to An Bord Bia to promote our food industry and that is to be continued in 1996. That investment will bear fruit. However, there is an onus on producers although they may not have had sufficient support from the Department in the past. I endeavoured to promote producer groups and I am proud to inform the House that one such group which is very active in County Monaghan dealt with in the region of 15,000 to 20,000 lambs in the past 12 months and obtained somewhat better prices for them.
There is need for much greater commitment on the part of the Department to promote the establishment of more properly organised groups thereby ensuring better quality lamb reaches the marketplace. I am disappointed that the meat industry has not done very much to encourage such groups. It appears they are interested only in getting lambs to their factories, regardless of price, so long as they make a profit. There is need to ensure production of better quality lambs and that we do not lose out on early production thereby maintaining our position in the marketplace.
I recommend we continue to support the Minister who has done a tremendous job within a few months in implementing the charter of rights for farmers which has benefited sheep farmers and others. Applications for headage payments and so on are being dealt with more expeditiously. I assure all farmers that the Fine Gael backbenchers will ensure the Minister does everything possible to obtain a European Union commitment to better structural support for them.
I welcome this opportunity to contribute to this debate and thank the Minister for the great efforts he has made on behalf of farmers since his appointment. He has been a breath of fresh air in the Department.
Hot air mainly.
Our farmers have every confidence in him and are extremely grateful for his having achieved more in ten months than previous administrations in nine years.
I want to thank him also on having designated my county a severely handicapped area. The campaign to achieve that has been going on for the past ten years and the Minister delivered within ten months of taking office.
He never changed a line.
The Minister reminds me of one of his predecessors, former Minister Mark Clinton, a man who brought home the bacon. He is seen as a capable negotiator, the type of Minister we want representing our farmers, a person who understands his brief, who can take on the European Union, debate the relevant issues and get his points across. With him at the helm sheep farmers, like all sectors of the farming community, can have every confidence that the problems confronting them will be resolved.
The Minister inherited the problem from the previous administration, a spillover of many of the ills from 1994. At that time no market could be found for hoggets and they were dumped on our market in the spring of this year thus depressing lamb prices. The Minister took immediate action to rectify that position.
The statistics quoted can be confusing but the Members who quoted them are not fooling anybody, certainly not visitors to the Public Gallery because they know who is representing them, that they have a Minister who will conduct business satisfactorily on their behalf. They told me so in Buswells Hotel today. They are delighted they have a competent Minister who has a tremendous grasp of his brief.
As a result of the Minister's decision on premia applications in regard to the sheep sector by next spring sheep will not have to be held over until the market becomes saturated——
(Wexford): There will be nobody left engaging in sheep farming.
Farmers will be able to send their sheep to the marketplace earlier. We must remember that we are dependent on export markets. One would imagine it was a matter of merely bringing lambs to Cork, Limerick or Dublin to solve the problem but 80 per cent of lamb produced here is exported to Britain and other European countries. Problems were encountered due to currency fluctuations and the Minister will address them.
What will the Deputy do about that?
The Minister will deal with those problems. We are seeing a rise in the sheep prices graph and farmers can have confidence going into the winter and look to early spring 1996 — for which they must plan — in the hope that lamb prices will stabilise and yield the profit producers deserve.
While it is not the major industry in my county it is my duty to echo the sentiments of the sheep farmers of west Cavan.
The Deputy has not done so yet.
They and I have confidence in the Minister and look forward to a resolution of this problem soon.
I look forward to the Minister retaining this portfolio not merely over the next two years but over the next decade. The changes and developments in farming generally require his attention.
I wish to share my time with Deputies Power, Éamon Ó Cuív and Clohessy.
Acting Chairman
Is that agreed? Agreed.
I have been in the livestock marketing business for many years, having worked with the Galway co-operative livestock marts and the private marts in County Meath. I am aware of the many ups and downs that may occur in farm incomes — one year may be good and the next two may be bad — but there has been a serious decrease in income for many sheep farmers. The IFA is a strong lobby group when it comes to farm incomes.
Sheep farmers are experiencing very difficult times and I appeal to the Minister and the Government to assist them as quickly as possible. Sheep farming incomes have fallen by 36 per cent or £13 per ewe. Early lamb prices are down by almost £10 per head and mid-season lamb prices by almost £6 per head. Over the last three or four years almost 5,700 flock owners have gone out of sheep production because of the high labour costs and small returns. If the Minister is not prepared to assist sheep breeders now this trend will continue.
Ewe numbers have decreased by 240,000 in recent years. I understand the anxieties of sheep farmers but at the same time we must appreciate and develop our international trade. I appeal to the Minister to make strong representations to his counterparts in Europe that sheep production in Ireland is only a small percentage of total EU production and, therefore, an overall calculation of prices to decide premia is unfair to a small producer like Ireland. Why should Irish milk producers, who only wet the bottom of the EU milk tank, have to comply with general EU reductions and new regulations? As a result of the system of calculation Irish sheep farmers need a top-up premium of £8 per ewe.
The County Meath sheep farmers are lowland producers. They find themselves in a position in which they have little or no control over market conditions. The Minister's counterparts in Europe do not seem to take into account marketing management. There is an urgent need for a change in the present EU rules regarding the date on which a lamb becomes a hogget. The date this year was 18 April which meant that hoggets could not be sold until after that date or they would not qualify for the hogget subsidies. As a result the marketing system we had has changed. The hoggets which would have been sold in January, February and March, as in previous years, now come on the market at the start of the early spring lamb season. Prices for early spring lambs, therefore, reduce accordingly because of over supply at that time.
We should go back to the old system whereby a lamb was identified as a hogget on 1 January each year. This would allow the hoggets to be sold in January, February and March as usual and, therefore, not interfere with the early spring lamb trade. The usual seasonal lamb trade in May, June and July would also be less affected by over supply. It is obvious that this closing date interferes with our own trade and brings down lamb prices. The EU may have it reasons for choosing the date of 18 April but changing it back to 1 January would not cost the EU any extra money as the sheep breeders can only fill their existing quotas.
When Deputy Yates became Minister for Agriculture, Food and Forestry expectations were high. Within a few weeks, if one was to believe what one read in the newspapers, one might have believed agriculture's ills had been cured because the Minister put in train a PR effort the likes of which had not been seen before. Unfortunately, appearances seemed more important than substance and it may come as a surprise to many to see the present crisis in the sheep sector.
A number of speakers have outlined the seriousness of the problem. The IFA has listed its demands to right the present wrongs and Fianna Fáil supports those demands. This is a very important industry which has unfortunately experienced a difficult year. Urgent attention must be given to the problem and assistance provided. There is a serious lack of confidence among sheep farmers as a number of them have gone out of business over the last couple of years. This cannot be allowed to continue. It is important that confidence be restored in the industry and that it receives proper attention.
In County Kildare, particularly on the Curragh, one can readily see the importance of sheep farming, related processing industries and the wool industry. Over the last ten years we have gone about building up the breeding flock but it has declined in the last 12 months. The Fine Gael Members express great confidence in the Minister going to Brussels and I hope that confidence is well-founded. The serious problems have been outlined in this House and by the IFA, and I hope the Minister will take the necessary action to restore the confidence which is badly lacking in the sheep sector.
I am pleased to have the opportunity to speak on this subject. I have noticed that in respect of measures which were in train before Fianna Fáil left power, such as the extension of the disadvantaged areas, credit is claimed by the Government. However, when discussing those measures which might not have been taken before we left power but should have been taken by now blame is laid on the previous Government. It is about time the Minister realised he has been in Government for almost a year and accepted the responsibility of Government. The Minister should be big enough to admit the work that was done before he took office and big enough to direct his attention to the problems that face him now which have not been dealt with.
The problem we are discussing tonight has become acute so it could not have been dealt with before we left office. The Minister will have to deliver. When this problem arose previously in 1992 the then Fianna Fáil Minister for Agriculture, Food and Forestry was able to have the problem dealt with in Europe. We understand the Minister boasts of his relationship with the Agriculture Commissioner but if it is that good he should deliver on it.
Sheep farming is indigenous. The Minister has to ensure that families who depend on sheep farming are given a stable and adequate way of life. It is the Minister's responsibility to ensure that a mechanism is put in place that will trigger a response when prices in Ireland drop beneath a certain level and that farmers will get automatic compensation.
We have tended to concentrate on the problems of the lowland farmers but I will stress the needs of the hill farmers, whose problems are not being dealt with. It might come as a surprise to the Minister to find out that the average price of lamb in Connemara is between £10 and £19 for uain fhireann or wethers and for uain bhaineann £25. An average mountain ewe would yield 2 lbs. of wool and this sells for 35p per lb. I have calculated that a farmer with 100 ewes has a gross annual income, including subsidies, before expenses are paid of approximately £4,360. When the expenses are taken from that very little is left. No wonder so many of our farmers have to rely on social welfare to supplement their income.
I was interested to hear the speech of the Democratic Left Member. I have a question that the Minister for Agriculture, Food and Forestry and his colleague the Minister for Social Welfare failed to answer. Will the Minister confirm whether farmers in receipt of unemployment assistance, who need that money just to survive, will be assessed on moneys received under the REPS scheme? It is about time that the small farmers were given an unequivocal answer to that question. The Minister said he was favourably disposed to them but being favourably disposed never put money in anybody's pocket. It is about time he persuaded his colleague in Government to make a decision on that matter. If farmers are to be assessed on a pound for pound basis on their income from the REPS the Minister should admit that will be done.
The Minister recently came bearing gifts for the west — I have a copy of the press release.
I got a very good reception in Leenane.
Subsequently a meeting was held to which the farmers were invited and they attended. The Minister's colleague — and fair play to him — also produced a very nice document. The Teagasc advisers were asked about the details of the scheme but they did not know how it would work. They asked me to contact the Department and ask for the regulations but when I did so there was a problem — there were no regulations. There is no scheme, it is a PR job. Furthermore, when the Minister comes to draw up the regulations it might be a good idea to consult hill farmers on the realities of hill farming in the west. They have questions to ask, for example, if they reduce their quota from 100 to 70 and take the money and the scheme comes to an end in five years' time they will have two years to again increase their herd to 100 but a hill farmer cannot do that. The Minister may not realise that but the hill farmers do. One cannot buy ewes and put them on a hill because they stray and the Minister has not ensured there is adequate fencing of our hills and effective division of commonage. The Minister is not willing to provide the staff for that. We want to see the small print of new schemes and ensure they are workable.
The Minister has destroyed the REPS scheme because he will not make a decision on whether the income from it will be assessed as means for social welfare purposes and this scheme will be destroyed because there are no regulations for it. All that glistens is not gold. I call on the Minister to deliver on his promises and go to Europe to get the top-up premium. If the Minister is successful we will stand behind him but if not we will rightly criticise him. We are also looking for an extension of the rural premium to cover lowland farmers who have been very badly hit this year. A permanent mechanism needs to be put in place that will ensure that if a similar situation recurs there will be a mechanism to deal automatically with the problems.
We will give credit when the Minister delivers because, unlike him, we are big enough to give credit for achievement. We will not claim the credit for his achievements as he has been doing. If he does not achieve this he will be held responsible. Those who are trying to survive will know where the responsibility lies.
I have raised another issue that the Minister has chosen to ignore, the case of a small farmer who returned from England to take up farming on the family holding. His father had died prior to 1992. He has a hill farm with commonage but the only thing one can do with the hills is put sheep on them. He applied to the national reserve but was told he was too old at 43 years of age. I made the point to officials that it is wrong to say that people are too old at 35. I accept the rule existed before this Government took office but the Minister had a chance — which he did not take — to change it.
There are 20,000 ewes in the national reserve.
The suggestion was that the Minister would change the criteria for 1996 and I have no doubt that if the Fianna Fáil Party had remained in power the Minister would have listened to my pleas, particularly for commonage farmers, and dealt with the issue. The Minister chose not to deal with it. It is a tragedy that someone who has returned to farm a small hill farm is deemed too old and is outside the criteria to be eligible for even a small ewe quota that will get him back to farming the traditional family holding.
I thank Members on the Fianna Fáil benches for sharing their time with me. We are all aware of the difficulties facing sheep producers in this country. Those most severely affected are small farmers, many of whom are totally or mainly dependent on sheep for their income. In many instances these farmers are working poor land and switching to alternative farm enterprises is not a realistic option. The sheep sector is in deep crisis. It is not only producers who are seeing their profit margins fall and many are producing sheep only to sell them at a loss.
To put the matter in context, prices for producers of early lambs are down this year by 15 per cent compared with 1994, and the total net margin per ewe is estimated to have fallen by one third in the same period.
This crisis has been brewing for some considerable time. The Minister for Agriculture, Food and Forestry has been in office for almost a year now and has had plenty of time to acquaint himself with the developing situation. The solution to it lies in Brussels and that is where he should exert himself. Has he presented any practical proposals to resolve this crisis to the Council of Agriculture Ministers, or has he raised the matter in the Council at all?
The demands made by Irish sheep producers can be comfortably met without any increase in the overall budget for the Common Agricultural Policy. Buoyant market conditions for grain and dairy commodities have relieved the pressure on the CAP budget and there was plenty to spare to accommodate the needs of our sheep farmers.
The difficulties facing the sheep sector were highlighted only last week with the publication of the Farm Management Survey of 1994. It showed the average income per acre for different types of farming enterprise. For dairying the figure was £233; for tillage it was £130; for cattle it was £87; and for sheep it was just £80. Since then, that figure is likely to have fallen even further, pushing the country's 48,000 sheep farmers to the brink of economic disaster.
It was estimated last year that 92 per cent of sheep-farm incomes derived from direct headage and premium payments. With many sheep farmers expecting a loss, that figure could now have risen to 100 per cent. The real question now is whether the EU will maintain this level of direct payments and continue to support the sector in this way.
Brussels has a responsibility to act in what, in effect, is a breakdown in the single European food market due to currency fluctuations. Ireland's principal export market is France. Last year, we shipped over 50,000 tonnes of sheepmeat to the French market, with a total export value of more than £104 million. France accounts for 80 per cent of our total exports in the sheepmeat sector. It is a market which is becoming increasingly competitive, but our main threat comes from the British. The weakness of sterling has helped British exporters to increase their shipments to France. During the first six months of this year, for instance, British exports to France increased by 6,000 tonnes, a rise of 10 per cent over the same period the previous year.
An Board Bia is now forecasting that for 1995 as a whole, British exports to France will be up by about 8 per cent on 1994 levels. These increased British shipments are effectively crowding out Irish produce and forcing down market returns for Irish producers.
The fall in Irish exports to France in the current year has been dramatic. Figures from the Central Statistics Office show that in the first quarter of 1995 Irish sheepmeat exports to the French market were down by 44 per cent in volume terms and 42 per cent in value terms compared with the first three months of 1994. This represents a catastrophic decline in our single most important export market.
Naturally enough, the current situation has also affected the ability of Irish exporters to sell into the British market. In 1993 we sold more than £11 million worth of sheepmeat into Britain; last year, that figure had halved to just £5.5 million. The currency disadvantage is especially important as Britain is the largest producer of sheepmeat in Europe. British output is greater than the combined production of the second and third largest producers — Spain and France. It is more than four times greater than Ireland's annual output.
The value of sterling is clearly having a devastating impact on our ability to compete on equal terms on the French market and in European markets generally. Accordingly, the Government should press for compensation for Irish producers who are being disadvantaged by sterling's weakness. It is up to the Minister to stress to his colleagues on the European Council the importance of sheep-farming to the economy. Although Ireland has only 1 per cent of the EU population we account for more than 8 per cent of sheepmeat production.
Solving the short-term problem is one thing, but we also have to look at the longer term. Irish sheep numbers have exploded over the last ten years in response to CAP incentives. Total sheep numbers have risen from 4.1 million in 1984 to 8.4 million in 1994. We have to ask ourselves if Ireland can support a sheep population of this size on a long-term basis.
The present regime has created an artificial economy in which, in some cases, sheep are being bred purely to qualify for the premium and headage payments available, without taking any congnisance of prevailing market conditions. This explosion in sheep numbers could not have taken place without having some effect on the natural environment. Overgrazing has done considerable damage to upland areas, particularly in the west. Experts have stated that it could take several generations to remedy the damage done. These are areas with a heavy dependence on tourism and where tourism related projects offer major potential for future economic development. It is vitally important that we balance the respective needs of agriculture and tourism.
We must also be aware that things are changing in Europe and on the world food market. Mr. Chris Haskins, the head of Northern Foods and one of the most important figures in the food processing industry on these islands, spoke at a conference in Dublin last week. He made it clear that GATT reform would lead to a free world market in food even though this might damage the prices achieved by farmers. He felt the move to free trade was inevitable.
As he is one of the key figures in the European food industry, the view expressed by Mr. Haskins cannot be ignored. If, as he says, Europe is heading for a market economy in food, then that will have consequences of the utmost importance not just for our sheepmeat sector, but for every aspect of the food industry. We need to start debating these issues now, and the Minister should take the lead in this matter. Political developments will propel this issue to the top of the agenda in any event.
Plans are already under way to expand the European Union eastwards. Enlargement of the Union could bring in as many as ten new states, stretching the EU from the Baltic to the Balkans, Some of these countries such as Poland and Hungary have substantial food-production and food-exporting industries. The cost of maintaining the present array of price supports would rise dramatically in the wake of enlargement. For the people who have to pick up the bill—the taxpayers of Germany who fund some four fifths of the EU budget—this is not an attractive prospect. All the indications are that enlargement is likely to accelerate moves towards a more market-based pricing system for all agricultural produce, including sheepmeat.
If there is to be a major sea change in European agricultural policy, it is important that we get our act together now. What kind of regime will replace the present one? What transition arrangements will apply? I would be interested to know what views on this subject our Minister for Agriculture Food and Forestry is putting to his European counterparts, or is he adopting a complacent attitude and assuming the present regime will continue forever? Other countries have already made the transition from farm supports to the free market, New Zealand being a notable example. If this process is not properly managed and properly prepared for, we could be headed for trouble. We receive about £1,400 million in agricultural supports of one kind or another from the European Union every year. This is a huge sum for an economy the size of ours and is roughly equal to 15 per cent of current Government spending on supply services. The loss of this huge level of financial support would have dramatic consequences for the economy, but we are carrying on as if this money was guaranteed to us for a long time. I am sure it is not.
The Council of Agriculture Ministers will meet in Spain on 11 and 12 April next. The Minister should come out of that meeting with a package of measures designed to alleviate the hardship currently experienced by this country's hard-pressed sheep producers.
The Minister, Deputy Yates has enjoyed something of an extended honeymoon with the farming organisations during his tenure of office to date. If he fails to deliver the goods next month, I can assure him that his honeymoon will be well and truly over.
During the debate we witnessed hysteria on the Opposition benches about the extent of the problem in the sheep industry, but in the real world that attitude does not solve anything. Members on both sides agree that the problem centres around spring lambs which were mainly produced in high cost production systems and came on the market when prices were disappointing. It is this group in particular that has suffered the most severe income losses. During the summer market prices were sustained at a constant level, although below last year's price level. By September the market began to pick up and in the past six weeks prices have been approximately 5 per cent above those of 1994. Provided they hold until the end of the year — the outlook is good — a substantial number of sheep sold this year will have been sold at prices better than those that obtained last year. This is not to understate the extent of the problem but merely to put it in context.
The Opposition motion does not reflect reality because the truth is that the matter has been tackled head on and action taken. The accusation of indifference or lack of action is a complete misstatement of the facts. My Department's response to the serious market position was quick and effective and no effort was spared to find solutions. The European Commission was quickly persuaded to introduce an aid for private storage scheme for Ireland by the end of April, a practical measure to take the overhang of hoggets off the market.
How many?
It quickly resolved that problem.
Prior to this, having investigated the ewe premium payment system, the Minister submitted a memorandum to Commissioner Fischler setting out clearly Ireland's problem and seeking compensation for our sheep farmers for the inadequate support provided by the ewe premium. At every opportunity we highlighted the absence of price convergence under the current system and the need to redress the imbalance arising from this. In July, at the Minister's request, the Commission launched a further aid for private storage scheme that put strength into the market at a crucial time.
The value of these APS measures has been fully recognised and acknowledged by the industry and that is a matter of record. Members of the Opposition have attempted to denigrate the effectiveness of those measures. What would have happened if they had not been taken? The answer is clear. The position would have been considerably more difficult. Contrary to what has been said, the APS measures did help prices.
At the June Council of Ministers a key commitment was secured that the operation and level of ewe premium would be reviewed. This commitment, secured after considerable effort, is the basis on which current negotiations are focused. It was also due to these demands that the earliest ever payment of the first two advances of the ewe premium was made. Important adjustments have been made to retention periods under the ewe premium scheme which will help the more orderly selling of lambs next year.
The problems of Irish sheep producers have been firmly kept on the negotiating table. I can say with confidence that every Minister with responsibility for agriculture in the European Union as well as the European Commission is fully conversant with the difficulties in the Irish sheep market and we will not rest until this effort has delivered tangible results.
Good.
Because of the budgetary position in Brussels we were always aware that there was no scope for special concessions until the 1996 budgetary year which began in November and that a solution is not likely until the December Council meeting. Any solution depends on the Commission coming forward with a proposal and it receiving sufficient support at the Council of Ministers. This is why so much effort has been devoted to convincing the Commission and individual EU Ministers of the merits of our case.
Apart from looking to Europe we must see what we can do to improve the position at home. A working classification system that rewards the producer for quality is crucial to the improvement of the standard of Irish lamb production. It is essential that it is workable and effective. A voluntary scheme would stand a better chance of being effective. There is no question of surrendering to vested interests, as was alleged. We are making substantial progress on this issue. The intention is that the carcass classification will be standard practice in the industry by 1 January next.
The motion before us does not fairly or accurately reflect the progress made or the extent of our efforts. I recommend the amended motion as a truer reflection of the position.
The Minister should ask Kepak about that.
I wish to share my time with Deputy Hugh Byrne.
I am sure that is satisfactory and agreed.
I came to listen to the debate, not to contribute because there is a sufficient number of Fianna Fáil Members who wish to speak. However, I requested permission to speak for two minutes because I am appalled at the Government's complacency about this crisis. I expected at least to hear an admission that there is a crisis and an expression of concern for farming families who depend on the sheep industry and have suffered greatly in recent times. It has become normal practice for the Government to wheel in members of the Democratic Left. Government members smiled gloriously as Deputy Lynch denigrated the farming community, expressed concern that subsidies were not slashed and promoted consumer resistance to subsidies. I wish to put one question to Deputy Lynch and members of that wing of the Government who lack knowledge of, and do not care about, the current crisis in the sheep industry, and they are supported by other Government members in this regard. If the subsidies are so worth while and farmers are doing so well, why are so many of them getting out of farming? There is no other business that people are leaving so fast. Why do farmers find it difficult to encourage their sons or daughters to follow them in farming? When a genuine motion is put down by the Fianna Fáil Party to deal with this crisis it is a shame that it should meet such complacency and unadulterated ignorance about the current problem in the sheep industry.
I want to make one plea and it is not about public relations, politics or the Minister of State's solution which is so long-term that farmers will have forgotten they were ever in the sheep business by the time they benefit from it.
The Deputy is blowing hot air.
He had his chance.
Deputy Deenihan is not in St. Brendan's in Killarney now.
We need action and solutions now.
We make no apology for raising this issue. It is disappointing that Government members should indicate that we should not have tabled this motion. Where have they been for the past six months? This matter is of major concern to all sheep farmers and members of the Government know that.
We want to strengthen the Minister's hand when he goes to Brussels and to encourage a change in attitude. Fianna Fáil will support any attempt to improve the lot of sheep farmers. The former Taoiseach, Charles Haughey, once remarked that the way to become a success in politics is to be in the right place at the right time. By any standards, the Minister, Deputy Yates, is a very lucky politician. No Minister for Agriculture in modern times took up office with a better sense of timing.
It is rich testament to his predecessors that virtually all the Minister had to do in 11 months in office was travel around the country announcing good news, with his powerful media machine making more noise on the roads than the old threshing mill. Years of Fianna Fáil Government have left Irish agriculture in the best state it has been in years. The generally healthy state of the agriculture industry results from Fianna Fáil courage in Government to face the issues without fear of sectional interests. Fianna Fáil Ministers went to Brussels with vision and courage. It seems the Minister, Deputy Yates, is determined to rest on the laurels so hard won over seven years by successive Fianna Fáil Ministers.
I spoke already about the buoyancy in Irish agriculture, which is general but not absolute. There is one serious exception, the sheep sector. Recently the Minister has been busy playing down the extent of the problem. A meeting organised by the IFA recently in Enniscorthy was attended by about 400 sheep farmers. I compliment the IFA and ICMSA for the pressure they have applied on all of us. On that night all we heard were excuses for the nondelivery of their request. Today in Buswells I heard the same old line. I do not know whether it was evident to the Minister or whether it was out of respect that the people at today's meeting did not tell him that there is much disappointment, disillusionment and anger about his defeatist attitude.
The Minister's spin doctors have been pouring cold water on the fading hopes of him bringing home a desperately needed solution from the Council of Ministers' meeting on 11-12 December. When he came into office the Minister identified the crisis in the sheep sector as his number one priority, and rightly so, given the excellent conditions in other sectors and having experienced the best weather in years. Not only was the sheep sector his most important problem; it was his only major problem. In the cereal sector there were tremendous yields of sugar beet and in the dairy sector there were good yields and good prices. As the Minister said last night, pig prices are cyclical, and he came into office just as they increased. It is important to put the crisis in context in terms of the Minister's agenda. In 1995, apart from claiming credit for the achievements of his predecessors, the Minister had little else to do. The bottom line is that doing something about the crisis in the sheep sector was not an easy photo opportunity and therefore nothing was done.
Fianna Fáil put this very important issue on the top of its agenda but the Government ignores it. When opening the debate on the Fianna Fáil motion our party spokesman, Deputy Cowen, made a persuasive case on why intervention in the sheep sector is necessary. The measures that must be taken are well known and were put to us at today's meeting as well as in the recent past. Sheep farmers and Fianna Fáil demand the extension of the rural world premium to non-disadvantaged areas. Just as important is the £8 top-up needed on the present premium. Fianna Fáil is not asking the Minister to do anything that it did not do in power. In 1992 Fianna Fáil in office delivered the ewe premium top-up when it was desperately needed.
I wish to set out what is being requested. On the rural world premium, of a national flock of 4.75 million, 74 per cent are in disadvantaged areas. The extension of the premium to the remaining 26 per cent of the flock or 1.2 million ewes, would cost £6.6 million. This would surely be a small price to get our lowland producers out of the present abyss — that is no exaggeration of the depths of the crisis. The number of sheep farmers leaving the land is unbelievable and very unsatisfactory and the number of people who have lost jobs as a result, or possibly will lose them, must be of great concern.
I was very interested to hear Deputy Lynch attacking the farming community, as has been done many times in the past by Democratic Left. Does she represent the working class? Does she agree that a fall in sheep numbers will result in a reduction in the number of workers in factories? I was disappointed with the attitude particularly of the Fine Gael Party — they sneered and laughed — to Deputy Lynch's contribution. If they walk through the same lobby this evening as Democratic Left, shame on them. If they have any respect for our biggest industry now is the time to show it. I call on them to dissociate themselves from the remarks of Deputy Lynch and her colleagues. I am sure the people of Galway will be very interested in Deputy Browne's support for that party.
(Carlow-Kilkenny): We will support our Minister.
Support your people.
Nobody did as much for sheep farmers as I did.
In 1995 40 per cent of early lambs were sold at a loss. If the Minister is in any doubt about that, he should talk to his neighbours in the constituency of Wexford. The position of our sheep farmers is desperate. A conference was held in Wexford in the summer at which many promises were made. The big machine rolled in and aid for private storage was promised, but I have yet to hear anyone in the farming community or the industry say that was a success.
To put the total package requested into context, both elements add up to £44 million. The total EU sheep budget is approximately £2 billion. Irish farmers are effectively looking for the crumbs from the rich man's table. I hope the Minister's statement of last night and detail of his attitude do not reach Brussels before he does. I plead with him to visit, between now and the Brussels meeting, all the agriculture Ministers in their own capitals to seek their support. He said he does not have their support; the way to get it is to visit each one of them on their home ground. That must be done before the Minister attends the next Council of Ministers meeting. I repeat that Fianna Fáil will support any attempt to improve the lot of sheep farmers. This is the best case ever presented in that regard. The Minister should believe in the cause and go out with all guns blazing.
Amendment put.
The Dáil divided: Tá, 65; Níl, 58.
Tá
- Ahearn, Theresa.
- Barry, Peter.
- Bell, Michael.
- Bhamjee, Moosajee.
- Boylan, Andrew.
- Bradford, Paul.
- Bhreathnach, Niamh.
- Bree, Declan.
- Broughan, Tommy.
- Browne, John (Carlow-Kilkenny).
- Bruton, Richard.
- Burke, Liam.
- Burton, Joan.
- Byrne, Eric.
- Carey, Donal.
- Connaughton, Paul.
- Connor, John.
- Coveney, Hugh.
- Crawford, Seymour.
- Creed, Michael.
- Crowley, Frank.
- Currie, Austin.
- Deasy, Austin.
- Deenihan, Jimmy.
- Doyle, Avril.
- Dukes, Alan M.
- Durkan, Bernard J.
- Finucane, Michael.
- Fitzgerald, Brian.
- Fitzgerald, Frances.
- Flaherty, Mary.
- Flanagan, Charles.
- Gallagher, Pat (Laoighis-Offaly).
- Gilmore, Eamon.
- Harte, Paddy.
- Higgins, Jim.
- Higgins, Michael D.
- Hogan, Philip.
- Howlin, Brendan.
- Kavanagh, Liam.
- Kemmy, Jim.
- Kenny, Enda.
- Kenny, Seán.
- Lowry, Michael.
- Lynch, Kathleen.
- McCormack, Pádraic.
- McGahon, Brendan.
- McGinley, Dinny.
- McGrath, Paul.
- Mulvihill, John.
- Nealon, Ted.
- Noonan, Michael (Limerick East).
- O'Keeffe, Jim.
- O'Shea, Brian.
- O'Sullivan, Toddy.
- Pattison, Séamus.
- Penrose, William.
- Ring, Michael.
- Ryan, John.
- Ryan, Seán.
- Shortall, Róisín.
- Taylor, Mervyn.
- Timmins, Godfrey.
- Walsh, Eamon.
- Yates, Ivan.
Níl
- Ahern, Dermot.
- Ahern, Michael.
- Ahern, Noel.
- Aylward, Liam.
- Brennan, Matt.
- Browne, John (Wexford).
- Burke, Raphael P.
- Byrne, Hugh.
- Callely, Ivor.
- Clohessy, Peadar.
- Connolly, Ger.
- Coughlan, Mary.
- Cowen, Brian.
- Davern, Noel.
- Dempsey, Noel.
- Doherty, Seán.
- Ellis, John.
- Fitzgerald, Liam.
- Flood, Chris.
- Foley, Denis.
- Fox, Mildred.
- Foxe, Tom.
- Geoghegan-Quinn, Máire.
- Harney, Mary.
- Haughey, Seán.
- Hilliard, Colm M.
- Hughes, Séamus.
- Treacy, Noel.
- Wallace, Dan.
- Jacob, Joe.
- Keogh, Helen.
- Killeen, Tony.
- Kirk, Séamus.
- Kitt, Michael P.
- Kitt, Tom.
- Lawlor, Liam.
- Leonard, Jimmy.
- Martin, Micheál.
- McCreevy, Charlie.
- McDaid, James.
- Moffatt, Tom.
- Morley, P.J.
- Moynihan, Donal.
- Ó Cuív, Éamon.
- O'Dea, Willie.
- O'Donnell, Liz.
- O'Donoghue, John.
- O'Hanlon, Rory.
- O'Keeffe, Batt.
- O'Keeffe, Ned.
- O'Leary, John.
- O'Rourke, Mary.
- Power, Seán.
- Quill, Máirín.
- Smith, Brendan.
- Smith, Michael.
- Walsh, Joe.
- Woods, Michael.
Tellers: Tá, Deputies J. Higgins and B. Fitzgerald; Níl, Deputies D. Ahern and Callely.
Amendment declared carried.
Question, "That the motion, as amended, be agreed to", put and declared carried.