Dáil Éireann díospóireacht -
Wednesday, 10 May 2000

Vol. 518 No. 6

Written Answers. - Agriculture Industry.

John Bruton

Ceist:

231 Mr. J. Bruton asked the Minister for Agriculture, Food and Rural Development his views on the opinion of the agri food 2010 group that to achieve an optimum industry structure in the food industry one would have to reduce beef slaughtering capacity by up to 35%, reduce the number of EU approved poultry meat plants from 23 to seven and increase capacity by 20% and consolidate the dairy processing sector with no more than two or three processing sectors for the main products; his views on an optimum structure for the industry; and his policy to achieve that optimum structure. [13023/00]

Minister for Agriculture, Food and Rural Development (Mr. Walsh)

The 2010 committee report was presented to me on 24 March. It contains a considerable number of recommendations and findings. I am undertaking a round of consultations with the representative organisations on these findings and recommendations in the period ahead. It would be inappropriate for me to take a definitive position on any individual proposal in the report until these consultations are completed, which should not take longer than three months from the date on which I received the report. At that stage, it is my intention to formulate a comprehensive response to the report.

Specifically in relation to the beef sector, I would point out that the opinion of the agri food 2010 group that the optimum structure can best be achieved by a 35% reduction in slaughtering capacity is consistent with the 1998 McKinsey report on the beef sector and the 1999 report of the task force on the beef industry, which was chaired by the secretary general of my Department. I share the view expressed in these reports that the removal of excess slaughtering capacity would both improve the profitability of the industry through lower unit costs and enhance its ability to compete on the European market. In addition, it would provide for more full time jobs and the development of a more skilled workforce and, accordingly, improve the attractiveness of employment in the beef processing sector. It should be noted, however, that the agri food 2010 report recognised that such extreme rationalisation is unlikely because of seasonal or regional patterns of production, that the realistic scope for Government action is limited and that responsibility for dealing with this issue rests primarily with the shareholders in the industry.

Nevertheless, the Government does have a role in this area and, in order to secure a better industry structure, it has decided in the context of the national development plan to give priority to the beef sector at primary slaughtering and processing level. An operational programme to give effect to this decision is under preparation. This initiative, operating in partnership with the industry itself, should facilitate development and rationalisation in the beef processing industry in a planned way. Issues of the capacity and structure of the processing industry in the other sectors referred to also require attention, and these matters will form part of the consultation process on the 2010 committee findings.