Dáil Éireann díospóireacht -
Tuesday, 22 Oct 1996

Vol. 470 No. 4

Adjournment Debate. - County Cork Plant Closure.

Mr. M. Ahern

I thank the Chair for allowing me to raise this most important issue. I am disappointed, however, that neither the Minister for Agriculture, Food and Forestry nor the Minister of State at his Department is present.

The history of vegetable growing and processing in east Cork dates back to the early 1960s. It has been an important source of business for farmers and employment for hundreds of people in the area which includes Midleton and Mallow. The plant in question has been owned by several companies — Erin Foods, Findus, Campbells, Fresh Bake and now Universal Foods.

This is the last remaining vegetable freezing plant in the country. The permanent workforce is around 150 while the number of farmers in the area contracting to the company is in the region of 200.

The decision announced last night to shut down the air drying, that is, mechanical dehydration, plant will have a devastating effect on the area and will mean the loss of 50 to 60 jobs among the permanent workforce. It will also affect the number of temporary jobs, which are of great importance to students in particular, during the summer season when the harvesting of peas and beans takes place. It will also mean that up to 2,000 acres out of a total of 4,500 acres will not be needed for vegetable growing. That is a great loss in this time of restrictive quotas in milk, grain and beet in addition to the problems being experienced in the beef industry, particularly in light of the Minister's decision last week to ringfence Cork.

Since February 1995 the company has acquainted the Minister with the problems facing the mechanical dehydration process and the need for aid for vining peas, similar to that which is given to cereals, to ensure the viability of the plant. To his eternal shame, the Minister did not meet the management despite numerous requests over the past two years. He must take his share of the blame for the decision made yesterday to ringfence Cork for beef sales, in addition to this body blow to the vegetable industry which is turning Cork into a severely disadvantaged area.

I call on the Minister to act now to save this important industry which is worth approximately £6 million, much of which benefits the economy of east Cork. I understand the Minister is meeting some of the executives of the company tomorrow. I hope that meeting will be productive and help to save the jobs under threat as well as the livelihoods of approximately 50 per cent of the farmers who have been producing vegetables for the factory in Midleton for the past 30 years.

Mr. Howlin

I respond to the debate on behalf of the Minister for Agriculture, Food and Forestry. The company's decision to discontinue the air-dried function at its Midleton plant from next spring is a commercial one. It has been taken on the grounds that this part of the business has never been profitable in Ireland. The company points out that some 50 jobs will be affected but it is hoped that many of these will be saved.

The Minister is aware that the ineligibility of vining peas for area aid has been advanced as a compounding reason for the closure of the air-drying facility. The position is that area aid under the EU arable support system is confined in the case of peas to those harvested in a dry state. Vining peas, which are harvested at a green stage and subjected to air or freeze drying, are not eligible for area aid. While the Minister vigorously pursued their inclusion, Commissioner Fischler explained, in a detailed written response, the reasons this was not possible. These were that as vining peas had never been covered by a previous support regime, payment of compensatory aid under CAP reform was not justified unlike the case with cereals and other eligible arable crops for which previous price support were either reduced or abolished; the inclusion of vining peas in the arable support system would create distortions in the market and had been opposed by producers in the major production regions of the EU; and the introduction of an end use obligation such as dehydration would jeopardise the protected status of arable area payments under the GATT.

The Minister wishes to emphasise that, while the exclusion of vining peas from area aid was an issue for the company, the fundamental reason for the planned closure of the air-dried function is its non-profitability. the freeze dried-frozen divisions of the firm provide direct employment for up to 115 people in Ireland and continue to be profitable. The company has identified growth opportunities for this segment of its business. The Department of Agriculture, Food and Forestry and Forbairt remain at its disposal to discuss its plans with a view to possible assistance.

The Dáil adjourned at 9.05 p.m. until 10.30 a.m. on Wednesday, 23 October 1996.