Vol. 517 No. 3
16 Mr. J. O'Keeffe asked the Minister for Agriculture, Food and Rural Development if his attention has been drawn to the views expressed by the concerned milk quota holders group; if he will respond positively to its concerns; and if he will make a statement on the matter. [9642/00]
I have received representations from and on behalf of this and other organis ations in regard to the management of milk quotas. I am fully aware of the views of the organisation in question and I have met its representatives on number of occasions. In response to its concerns, which relate largely to the position of quota holders no longer involved in milk production, I have already outlined in detail the options open to its members under the new regime. I have addressed the points raised by the group in the House and officials of my Department have also attended meetings of the joint Oireachtas committee at which the organisation was represented and responded to questions raised by members of the committee.
The changes which I made to the milk quota regime as set out in SI No. 94 of 2000, which came into effect on 1 April, reflect the Government's concern for the livelihoods of Ireland's dairy farmers and the long-term future of the dairy sector. These changes are necessary if the dairy industry is to successfully position itself to face the competitive challenges which inevitably will arise in the years ahead.
The measures to provide for the transfer of quota other than with land are designed to give more flexibility and certainty to milk producers, greater priority access to quota for small and medium scale producers and more opportunity for competition in the milk production sector. The new milk restructuring scheme will allow for the sale of quota without land in a structured manner and directed towards priority categories. These new arrangements are designed to give active, committed producers greater access to quota over the coming years at a reasonable cost.
The system of quota transfer linked to land, which existed up to 31 March 2000 meant that producers were often unable to expand their enterprises and realise their full potential because of the uncertainty within the quota system and the limited availability and cost of additional quota. Furthermore, in many cases producers were required to take on additional land which they did not need for their farming operation to acquire extra quota. This imposed an additional cost and made it particularly difficult for small and medium scale producers to acquire quota. The option of temporarily leasing quota existed but this had the disadvantage that it operated only until the end of each quota year and did not give the certainty which active producers needed to plan ahead for the development of their enterprises.
I am aware of the concern expressed by those who are no longer involved in milk production and whose quota has been leased into the temporary leasing pool on a continuous basis. I will clarify the position in this regard. It will no longer be possible for such quota holders to temporarily lease their milk quota where the quota has been temporarily leased for the preceding three milk quota years, 1997-1999, or for a longer period. With effect from 1 April 2000, such quota holders will, however, have a number of other options, for example, to resume milk production in their own right during the 2000-01 milk quota year, to sell the milk quota into the 2000 milk quota restructuring scheme or to transfer the quota with the holding by way of a family transaction.
In certain exceptional circumstances, persons no longer involved in milk production may apply to my Department for an exemption from this provision. In the case of quotas leased out with land, the lessor will also have a number of options when the lease expires on or after 1 April 2000: the quota may be sold to the restructuring scheme; the lease may be renewed; the quota may be sold to the lessee with or without the land by agreement between the lessor and lessee; the quota may be transferred with the holding by way of a family transaction; the quota may be leased into the temporary leasing pool for one year only; the lessor can resume milk production provided he or she is not a participant in the scheme of early retirement from farming; and the lessor can draw up a lease with a new lessee in a case of a participant in the scheme of early retirement from farming where the original lessee is not in a position to renew the lease agreement.
I have consulted widely and taken extensive legal advice on the new arrangements and I have listened to the different views. The new arrangements are in the best interests of the future development of the industry and those committed to active milk production. All points raised by the group referred to, have been comprehensively and sympathetically dealt with and have been taken into account to the greatest extent possible.
Will the Minister accept that the concerned quota holders' group also includes many people who are not inactive? While many of them are inactive for one reason or another, many are small farmers who do not have access to temporary leasing which they had in the past. Will he accept that the situation in relation to the farm retirement scheme is confused, particularly the position of those involved in the scheme whose leases are now expiring? They are "hands in the dog's mouth" as far as the current lessees are concerned. Is that not also true in relation to new entrants to the farm retirement scheme?
Will the Minister accept that the scheme has major legal and constitutional implications? It amounts, effectively, to enforced sale of quota at knockdown prices by farmers who might have paid a great deal of money for them in the past.
The regulations have been drawn up following extensive and exhaustive consultations with the office of the Attorney General and the legal services of the European Commission.
The problem for people who were temporarily leasing quota was that annual leasing was unsatisfactory. At the end of a year one did not know if one could re-lease the quota so it was a temporary operation. The future of the industry cannot be built on such foundations.
People in the farm retirement scheme have a number of options. They can sell the quota into restructuring, renew the lease, sell the quota to the lessee with or without the land, transfer the quota with the holding by way of a family transaction or lease it into the temporary leasing pool for the coming year. The lessor can resume milk production provided he or she is not a participant in the early retirement scheme and the lessor can draw up a lease with a new lessee. If there is a problem with an existing lessee, the person can secure a new lessee and draw up a lease. There are seven options for participants in the farm retirement scheme. It is an extremely fair system.
If there is a three year cap on milk quota under restructuring and a five to six year minimum lease is required for the farm retirement scheme, how can the retiring farmer operate within those constraints?
Our few remaining farmers are becoming the most bureaucratised group in the world. Did the Minister give any consideration to getting the current temporary leasing, which he correctly described as disastrous for many of the farmers involved, put on a long-term basis of three to five years? I listened to his comments about its implications for the farm retirement scheme. Will he clarify what it means for those in the new REP scheme? How will they fit into it?
The three year cap is on the temporary leasing and there will not be a difficulty renewing the lease or selling it to the lessee. If there is a difficulty with the existing lessee, it will be possible to get an alternative lessee.
Can they do that for five years?
There will not be any difficulty. Typically, the lease will come up for renewal in the next year to three years.
That concludes Question Time.
We will have to return to this issue
Written Answers follow Adjournment Debate.
