Vol. 560 No. 3
I move:
That Dáil Éireann condemns the Government for its failure to recognise the difficulties in agriculture and food and calls on it to take some measures to re-establish confidence in the sector.
I wish to share my time with Deputies Hayes, Deenihan, McCormack and Enright.
That is agreed.
I agree with the second half of the Government's amendment to the motion which deals with opposition to the Fischler proposals. Fine Gael is opposed to the Fischler proposals. Our agricultural community bought into an agreement in Agenda 2000 to base its farm projections on that agreement. However, we are opposed to it because we do not agree with decoupling or modulation and we believe that many of the reports that have been published are based on false assumptions. We also believe that the nice rhetoric used by Commissioner Fischler concerning emphasis on quality is an aspect that could have been addressed within the current CAP system.
In addition, Commissioner Fischler continually reiterates the importance of a new system when he goes to the WTO, but we point out that the American farm Bill provided for putting $40 billion into agriculture in America, which would seem to contradict the line used by Commissioner Fischler.
The CAP is basically an agreement between the member states of the EU to protect farmers by paying subsidies to fix prices of farm products. It attempts to ensure an adequate supply, a stable market, a fair price for the farmer and a reasonable price for the consumer. It is important to realise that the ultimate beneficiary of subsidies is the consumer, a fact that many commentators fail to realise. Subsidies which are provided by taxpayers come back to them in the form of cheap food.
We are not here to debate the second half of the Government's amendment to our motion but to debate our motion and the first half of the Government's amendment to it. It is important to realise that not all agricultural policy is made in Brussels. The Government has an input and can influence how the industry operates. We are here to prosecute the Government for its failure to live up to its commitments to the agricultural community.
We are also here to complain about the failure of the input by the national Parliament on agricultural issues. One of the topics covered at length during the Nice referendum debate was the lack of Government accountability. In recent weeks a document was passed to the Committee on Agriculture and Food dealing with rules for negotiation on the agricultural input into the WTO. However, by the time that document came before the committee it had been accepted by the Government the previous day or the Monday beforehand, which I ask the Minister and his staff to bear in mind.
It is important to realise that agriculture is an important industry. Some 200,000 people are employed in the agri-food business. It accounts for 9.5% of our gross domestic product. We have agricultural exports of €7 billion, but the industry has experienced difficulties in the recent past. While our economy doubled in size in the 1990s, the agricultural industry stood still and, on close analysis, one could say it regressed. In the 1980s the gross value added to agriculture was 23% or 2.3% per year. However, in the 1990s it was only 6% or an average of 0.6% per year. This industry regressed at a time when our economy doubled in size.
Farm incomes have decreased – last year they decreased by 8.5%. During the tenure in office of the Government parties, from 1997 onwards, farm incomes have fallen behind those engaged in other industries. They have fallen behind the average industrial wage and those employed in the public sector. Others could argue that other sections have done well, and perhaps they have, but the farming community has lost out.
Those in the agricultural community sought support from the Government and thought there would be an understanding of their position. Consumers spend in the region of 20% of their disposable income on foodstuffs. However, such consumer spending has decreased by 1% per year over the past five years, which presents another difficulty for the agricultural community.
In fairness to the Government, the agricultural community was in difficulty so it held out the hand of friendship and produced the programme for Government, which with perhaps the exception of one point was based on the Fianna Fáil election manifesto. Despite claims by the Minister of State, Deputy Parlon, that he helped to negotiate the programme for Government, I must hand it to the Minister, Deputy Walsh, that he outbid the Minister of State on it in that the Mini ster of State appears to have been responsible for the inclusion of only one point in it, classification of the BMW region as disadvantaged. Up to November the Minister of State, Deputy Parlon, had not sought to even make representations to have the counties of Laois and Offaly, which he represents, included in that programme. I do not know if that position has changed.
I must table a parliamentary question on this matter. In a reply to a parliamentary question – I do not have the reply with me – the Minister stated that no Minister or Minister of State had made representations for additional area to be classified as disadvantaged. I hope I will not receive a letter on that matter from the Minister of State, Deputy Aylward, in the next few days. Up to the middle of November, the Minister of State, Deputy Parlon, failed to secure such a classification despite giving a commitment to his constituents in the run-up to the general election that he would do so.
The programme for Government refers to the opening of the markets. I was not a Member of the Dáil during the 1995 to 1997 Government, but from the few snippets of the proceedings of this House that I saw on television, I recall two members of the then Opposition from Cork East, Deputies Ned O'Keeffe and Michael Ahern, were up and down like popcorn on a hot range calling for markets to be reopened. What have they done since they went into Government? Were it not for the outbreak of foot and mouth disease in Britain our beef industry would have collapsed altogether.
The famous Marie Celeste set off for Egypt in April with a cargo of 65 tonnes of beef. The opening of the Egyptian market was announced with great fanfare in September 2001. One shipment was made in April 2002, but no shipment was made prior to or since that date. Deputy Cregan should use his influence with the Minister to change that.
That is not true.
It is true. I will not go into too much detail on this because I do not want to embarrass the Minister, but on close examination it will be found that that shipment was heavily subsidised, which means that basically it represented a false economy. We have been unsuccessful in opening up markets.
The Minister said that Teagasc would be dedicated to the improvement of agriculture, but the Government reduced Teagasc's budget by €12 million. The Government spoke about progressing the organic industry, but due to the cutbacks in Teagasc the agricultural college in Athenry, which is in the constituency of the Minister of State, Deputy Treacy, may have to close.
More will also have to close.
Probably more will have to close. I did not believe it was possible to close any more, but it appears the Government can achieve the impossible.
The Government said that Bord Bia would promote Irish food abroad, which is important, and Bord Glais would promote the vegetable industry, but I note there is a reference in one of today's newspapers to amalgamating and streamlining those agencies. The Department seems to be led by the so-called three wise men.
The Government said that the beef industry is underpinned by the national beef assurance scheme. When I was preparing to speak on this motion, I wondered where I would get material. I was disappointed to realise we would have only 120 minutes to deal with this matter. It is not in my nature to be critical, but I noted the swarm of material on this issue relating to schemes that have not been implemented. I noted that the beef industry was underpinned by the national beef assurance scheme, which was passed in the Dáil in 1998, but which has not been fully implemented, not to mention the national dairy herd certification scheme, which has also not been implemented. Our dairy industry lost out last year, of which the Minister, given that he comes from Cork, will be aware. That scheme must be brought back on stream. There was a the drop in dairy prices – at a rough estimate, €32 million was lost in the past year to the economy of County Cork, which is responsible for about 25% of our diary output. That loss is equivalent to in the region of 1,200 to 1,300 industrial jobs losses.
The Government spoke about protecting the environment. It allocated €234 million for the REPS, but only spent €175 million on it. That scheme is co-funded by the EU, which means that we lost €30 million in that regard. The Government referred to making REPS a more attractive scheme, but I have yet to see that happen. People are not taking part because the inputs have increased and it is not worth their while doing it.
The Minister spoke about assisting in farm investment, yet there was a cutback of €23 million in this scheme which deals with farm waste management and other structural deficits that need to be addressed to improve our competitiveness.
The national development plan reminds me of the Treaty of Limerick and the famous quote: "The treaty broken, ere the ink wherewith 'twas writ could dry." It is the same with the national development plan and the programme for Government. Like the national spatial strategy, there is nothing in the national development plan for agriculture. Even if there were, it would not matter because none of it is being implemented.
The Government said that, as a matter of urgency, we should consider introducing tax incentives to encourage young farmers to lease land. I know the IFA made a submission on this to the Minister before the budget. I did not see anything on it in the budget, but perhaps there will be something in the Finance Bill. However, from what I have seen to date, I would not hold out much hope.
The budget abolished roll-over relief. The "A lot done" section of the Fianna Fáil manifesto clearly outlined how it had set out a nice agreement on capital gains and capital acquisitions tax for people who had land taken from them or who sold it. However, the "More to do" section of the manifesto did not include the fact that Fianna Fáil would abolish tax relief. The Minister for Finance, Deputy McCreevy, flew through that when making his Budget Statement. Members of the Government were not aware of it. The Minister of State, Deputy Parlon, who was party to the agreement, certainly was not aware of it, although he tried to distance himself from it in the following weeks.
The straw that broke the camel's back was the Dáil resolution increasing the bovine diseases levies. It did not amount to much monetarily –€10 million – but it was a breach of faith. This was an agreement into which the IFA and the farming community had entered with the former Minister, Ivan Yates, in 1996, when the system was changed and the levies decreased. The current Government raised them again by 1c on milk and an additional €2 on animals.
That struck a chord with people. Here was a community that wanted assistance and sought something that could be provided by the Government, and all that was given was the abolition of roll-over relief. Everyone should pay their taxes but there is something fundamentally wrong about a person having to pay tax on the proceeds of the sale of an asset, the disposal of which he or she is required to do against his or her will. Will the Minister use his influence between now and the publication of the Finance Bill to address that difficulty?
As regards the tractorcade, I do not know how the Minister did it but he turned a low-key, borderline successful protest into a remarkable success. It was another fantastic achievement. The Minister said the average farm income was €45,000. I sincerely hope we will not negotiate in Brussels in the months ahead on the basis of that figure. Teagasc came up with the figure of €15,800. We should put this issue to bed.
I do not know who advised the Minister or whether he took it upon himself to undermine the protest. Had he been upfront on the first day, recognised that there were difficulties and said he would do his best to solve them, the protest would never have been as successful as it was. He made the protest.
We are having this debate to show that the Government made many commitments which it did not keep. The Ministers of State, Deputies Aylward and Treacy, acknowledge this privately. As a confidence building measure, the Minister should revisit the bovine diseases levies issue as an act of good faith. I know he will have the support of the honourable Minister of State, Deputy Parlon, because through the rhetoric during the tractorcade, he certainly gave the impression that he would support it. The Minister will also have the support of the honourable Deputy Ned O'Keeffe. He stood up on a tractor in Mitchelstown and I hope he stands up for the farming community now by speaking in favour of this proposal.
It is only a question of €10 million. The revised bovine diseases levies were introduced on the basis of the Exchequer returns forecasts. The figures turned out to be much better than anticipated. To revise the levies would send out a positive signal that could result in farmers entering the partnership agreement. It is important that they be a part of it. I understand why they are not because they feel there is no point in being part of it if they get nothing from the Government. The Minister should revise the levies.
The problems of agriculture do not begin and end with the Minister. I remember in the previous Dáil as junior Fine Gael spokesperson on defence that the Minister for Defence, Deputy Michael Smith, made a living out of telling us that the helicopters were coming and that the contract had supposedly been signed with Sikorsky. The new Government had barely been formed before he was out of the traps saying the helicopters were not coming. Then the Minister for Agriculture and Food, Deputy Walsh, made his announcement. He is being used as a crude instrument of government to hit the vulnerable agricultural community. The Taoiseach's thinking is that agriculture should be hit hard to obtain money from it.
Come June of next year after the EU Presidency, the Taoiseach will reshuffle his Cabinet and I would like to think he would retain the Minister, Deputy Walsh, in some form. However, he will probably cast around to identify someone with a lean and hungry look. He may go over the Healy Pass to south Kerry and choose the Minister, Deputy O'Donoghue, who has of late been giving dissertations on dinosaurs, a subject with which he would be familiar being a dinosaur on the political landscape himself. Unfortunately, unlike prehistoric dinosaurs, he has left considerable evidence of his tenure in office in the form of crime figures. The Taoiseach may also go further up the road and choose the Minister, Deputy Ó Cuív. Many in the rural community like him, he would go down well with them and the difficulties the Government has created for the farming community might be forgotten.
I would say to the agricultural community not to be fooled and to remember the hard times and how the Government put the boot in. They should not fall for the rhetoric of Government and blame the Minister, Deputy Walsh, for their problems. They are of the Government's making because it took a conscious decision to remove money from the sector.
I second the motion so ably moved by my colleague, Deputy Timmins. The reality is that life on the land is not good and never before has agriculture been in such a decimated state. The Government is running away from the crisis in farming and has delivered nothing to restore incomes. In the wake of the fight at the Cabinet table and in Brussels, the Government has failed miserably.
It must listen to what is happening on the land. The reality is that 300,000 jobs depend on agriculture, not just in farming but throughout the agricultural industry in sales, marketing, distribution, co-operatives and other businesses in rural areas. Several towns and villages depend heavily on agriculture for their well-being. Thousands of jobs outside farming are at stake if the Government does not take heed of what is happening.
The bottom line is that farm incomes have fallen way behind others. The average farm income is less than €15,000 per year compared with average industrial earnings of €26,000. Average public service pay is €37,000. Farm incomes have fallen from three quarters of average industrial earnings in the mid-1990s to little more than half, or 56%, of same in 2002.
Farm product prices have taken a hammering. Since 1995 cattle prices have fallen by 22%. I could go back further to when the Minister of State, Deputy Treacy, sold cattle in Mountbellew or Tuam. He knows how much prices have fallen since then.
That was without an envelope or direct payments.
Milk prices are down 9%, pig prices by 10% and grain prices by a whopping 30% since 1995. Livestock farmers have a chronic low income problem. Last year dairy farmers and grain growers probably suffered the most disastrous year in the past 50 years. In the past ten years 22,000 farmers have been forced out of full-time farming and had to get off-farm income because farming, as a way of life, no longer pays them. Young people are not coming into farming because they cannot earn a decent income to bring up a family. Only 13% of farmers are under 35 years of age. Agricultural colleges are closing. Rockwell Agricultural College at the heart of my constituency, in the county with the best farming land in the country, is no longer there. The college was closed under this Government.
What about Rockwell Hotel College?
Inflation is destroying farmers' income. The Government has failed to bring it down. The price farmers get for their products is failing, but inflation is running at between 5% and 6%. Living standards are being eroded every year. The year 2002 was a disastrous one for farming. Farmers' incomes were down by 8.5%. That means a cut of more than 13% in living standards when inflation is taken into account. The Minister, Deputy Walsh, has claimed that farmers' incomes increased by 39% in two years. The Central Statistics Office figures show the increase at 13%. Let the Minister and the Government be judged on their record. Since Deputy Walsh became Minister for Agriculture and Food in 1997, farm incomes have not kept pace with inflation. Average farm incomes have risen by 5.4% over a period when inflation was in excess of 20%
At a time when farming was on its knees, the Government put in the boot with the budget, which hit the farmers to the tune of €20 million with the disease levy. That was the straw that broke the camel's back. Environmental schemes like REPS and the farm investment scheme have been cut by €136 million compared to the Government's commitment in the national development plan. Forestry investment was slashed by €16 million and this has had a huge impact on an area that offered a different way of farming. The early retirement scheme has been affected and the list is endless. The National Roads Authority agreement is the real problem and we in south Tipperary have been affected by it hugely. The way that was cut back was disgraceful. People did not want to sell their land, but they were forced into an agreement. Throughout County Tipperary people are extremely hurt by this.
The mushroom industry, which has developed hugely, particularly in my part of the country, is having a very severe problem with labour shortages. The Tánaiste, Deputy Harney, announced cutbacks that are having a devastating effect on those people. The Minister for Agriculture and Food should look at that, because it will close down an industry that has brought considerable vibrancy to parts of my constituency.
This motion is very appropriate and timely. It comes at a time when we are facing a major challenge with the Fischler proposals and with the next WTO agreement, both of which go hand in hand, despite the fact that Commissioner Fischler seems to be ignoring totally what will happen in the WTO.
I had the experience of being in the Department of Agriculture and Food from 1994 to 1997. It was a time of hope and optimism and a time of buoyancy in the agricultural industry. 1995 was a record year for agricultural income, which was sustained for 1996 and 1997, despite the problems with BSE at that time. All sectors were buoyant at the time and no sector was under pressure. The various schemes, including REPS, were being introduced and taken up enthusiastically. When I left that section of the Department there were 46,000 people in receipt of REPS. Now there is nothing but depression in rural Ireland. People have lost the fire in their bellies.
I have sympathy for the Minister and the two Ministers of State, all three of whom I know. Being at the Department of Agriculture and Food at this time is a no-win situation. People have said there was a major lobby to keep Deputy Walsh as the Minister for Agriculture and Food. It was unfortunate that lobby was not try ing to have him put into some other Ministry. He may have been there in good times but he will leave the Department of Agriculture and Food in drastic times.
It is depressing to listen to the pessimism among young farmers who see no hope whatsoever. This includes people on farms with 100,000 gallon quotas. The price of beef has collapsed. The price of milk has been reduced dramatically and this will continue. In north Kerry, the Kerry Group is subsidising the price of milk by about ten cent and the chairman recently said farmers should be given ten cent less per gallon as he is losing on it. It is all about management.
I admire John Dillon. The action now being taken by the IFA should have been taken five years ago. I will say one thing about the Minister's skills at negotiating. He has embraced the IFA and brought it into the Department. When the Minister left office in 1994, the IFA said it found it very difficult to communicate with Deputy Walsh. However, he successfully adopted a different attitude. In the meantime the farmers of Ireland suffered and were at a loss. The action being taken by John Dillon, as leader of the IFA, should have been taken five years ago. The same pessimism among the farming community would not be there now if that had happened.
The forestry sector is very important to the farming community. The funding available for forestry has been cut by 22% from €106.4 million to €82 million. No approvals for new plantings have issued since last October. This reduction in the provision for forestry will have devastating effects on the farming community. This was one area where farmers were making some income. Dr. Richard Moloney from UCC has estimated that a cut of €24 million in the forestry budget will mean a total loss to the rural economy of in excess of €44 million, which will lead to the loss of 1,160 rural jobs. If a factory were to close tomorrow with the loss of that number of jobs there would be uproar in this House, but there is not a word about the loss of these jobs.
Of the 15,147 hectares of land planted nationally in 2001, some 2,017 hectares were planted in County Kerry, which represents 13% of the national total and was worth about €6 million in direct grant aid to cover the cost of the initial planting. Farmers will receive about €650,000 tax-free in premium payments annually over the next 20 years from the 2001 planting alone. This is critical income for the farmers concerned. The level of planting in 2003 could be reduced to 1,000 hectares in County Kerry, which would result in the loss of between 25 and 30 permanent and part-time jobs and the loss of premium payments to farmers over the next 20 years. As a rural Deputy, it is very painful for me to state the whole rural economy is in chaos and disarray and there is no one to lend a helping hand.
I support the motion. Family members involved in farming and the few constituents of Galway West left in farming have left me in no doubt that morale in the sector is at an all-time low. The IFA organised a well marshalled, peaceful tractor cavalcade to Dublin last month which did not go over the top and the Minister promised those involved he would address their grievances in the national partnership talks. He was quoted on television this evening welcoming the talks, while the president of the IFA, Mr. Dillon, stated the ball was in the Minister's court. It is time this matter, another of the Government's broken promises, was sorted out.
Deputy Deenihan expressed sympathy with the Minister and his Ministers of State at the position in which they find themselves in the Department of Agriculture and Food. He should show more sympathy for the farmers and farm families of Ireland who are very disappointed by their failure to deliver to the farming community.
Recent developments are all about politics, electoral strength and voting numbers. In the eyes of the Government, the rapid diminution of the farming vote means the farming lobby and community can be ignored. There is a great deal more attached to the farming community, its vote and the prosperity of agriculture than the incomes of farmers and farm families. Rural towns depend on a prosperous agriculture sector. We do not have one. It is almost impossible for the children of farmers to remain on the land. They see their brothers, sisters and neighbours working regular hours and receiving regular incomes. Farming is in a depressed state.
The Dúchas proposals in the framework for farming would have a negative effect on the farming part of my constituency, which is mainly located in Connemara. It is proposed that livestock farmers will have to take livestock off the commonages, winterages and mountains between November and May. In other words, the livestock will have to be housed. This would make this traditional style of farming in Connemara uneconomical and, therefore, impossible. It would wipe out the cattle population in Connemara because it would be unviable for farmers, for example, with ten suckler cows and some followers, to have to house their cattle in the winter months. I ask the Minister and his Ministers of State to address this issue.
Some €30 million allocated for the REP scheme was not drawn down. Why do we not improve its attractiveness to help farmers in difficult areas such as Connemara to draw down the money available from Brussels? It is not drawn down because the scheme is not sufficiently attractive.
Like my colleague, Deputy McCormack, I do not share the sympathy expressed by my colleague, Deputy Deenihan, for the three wise men opposite.
The Deputy should not do that to Deputy Deenihan.
He was perfectly correct in every other point he made.
He was an excellent Minister of State.
The Minister and his colleagues may not like to hear it but the Government's record to date in agriculture is appalling. I will not single out a particular Minister or attach full responsibility to one of them because the Government is collectively responsible for the position in which we find ourselves. I have repeatedly witnessed colleagues of the Minister scapegoat him and his Ministers of State for our problems and have been told it occurs throughout the country. The reality is that in the lead-up to 17 May promises were made at meetings with the IFA, ICSA and ICSMA and little has been delivered since. Farm families now realise that these promises were of little value.
My constituency of Laoighis-Offaly is in the Shannon region where, as the Minister will be aware, farmers must constantly struggle against repeated flooding of their land. Some areas have been flooded for months at a time with devastating consequences, yet the Government did not provide an aid package after the most recent flood. Those affected are being ignored despite the fact that their land is unusable and their crops are ruined. They also have the added expense of finding feedstuffs for their stock. This cannot be allowed to continue.
To return to the meetings held before the general election on 17 May, farmers heard a great deal about disadvantaged status, an issue raised by my colleague, Deputy Timmins. To be fair, one or two Ministers were brave enough to state what they understood to be the genuine position with regard to improving our disadvantaged status. Not everybody in government, however, was so open and honest about what could be done. In reply to numerous questions on the issue since the general election the Minister has said he is considering the question of disadvantaged status and that, under the programme for Government, the Government will try to have the entire BMW region included. It is farcical that a farmer on one side of a ditch is covered by disadvantaged status, while a farmer on the other side is not. People are expecting progress on this issue. When will they see it?
Some of my colleagues referred to the REP scheme. From numerous conversations, I have discovered that the poor take-up of the scheme is due to its bureaucracy. While I am aware the Minster has made some efforts in recent months to address this and accept that he wants to ensure changes in the scheme are robust and fully justifiable, this process will be time consuming. I cannot see how the problem can be resolved by initiating another consultative process to examine the scheme. This is more likely to add red tape than remove it. I have yet to hear warm praise for the recent changes. During a meeting with the IFA last night to discuss REPS the IFA was adamant that the scheme remains unattractive to the vast majority of farmers because of the bureaucracy involved and the conditions it imposes.
Another scheme which, if properly implemented, would have huge potential is the early retirement scheme from farming. To work as envisaged, older farmers would be encouraged to retire and younger farmers would take up the scheme. However, applications are being rejected for the most ludicrous reasons. Last year I learned of a woman who was refused entry to the scheme because she omitted to get section 12 consent from the Land Commission. In response to a parliamentary question tabled by another Deputy last year, the Minister stated consent had not been refused by the Land Commission at any time in the past five years, yet an application for the early retirement scheme was rejected because such consent, which is nothing more than a rubber stamp, was not provided. An entire section works to rubber stamp sheets of paper while applications are being refused for not containing it.
The application of another person was delayed for almost a year because it included the certified copy of her birth certificate instead of the original. While I accept this is a mistake, it is madness to delay an application for that length of time. It would be much simpler if someone picked up a telephone and informed the applicant that the wrong certificate was included and requested that the correct one be forwarded. The current position creates more work, red tape and expense for all concerned and makes no sense.
The scheme is of very little value to farmers. Since the introduction of the second scheme, they have received only slightly more than when it was originally introduced, which means it is not viable for many of them. Because of the amount of work involved, most farmers have to get a solicitor, an accountant and an agricultural adviser to fill in the application form. By the time they have paid those people, the first year's payment is gone. I could go on to deal with roll-over leases and so on but I will conclude.
The Minister's friends are in the House now.
I move amendment No. 1:
To delete all words after "Dáil Éireann" and substitute the following:
"recognises the substantial and continuing support this Government provides to the agriculture sector each year, acknowledges the series of actions taken by the Government to alleviate weather and market related difficulties which affected the agriculture sector last year and supports the Government's strong stance in defending the benefits achieved under the Agenda 2000 agreement in the current CAP reform and WTO negotiations."
I welcome the opportunity to discuss agriculture tonight and tomorrow night for an hour and a half.
I hope the Minister will be able to say that tomorrow night.
I have no doubt I will. As Deputy Timmins said, it is important that we discuss our major natural resource industry in this House on a regular basis. The record of the Government speaks for itself and completely belies the motion put down by the Opposition. Any reasonable observer would have to conclude that the Government, by its actions, has consistently demonstrated its commitment to the development of agriculture. The Government's approach has always been founded on the unique importance of the agriculture industry in terms of sustaining rural Ireland and as our major natural resource-based industry.
I would like to outline the Government's commitment to farming and the manner in which that has been demonstrated in a concrete fashion time and again. For those suffering from selective recollection, let me remind the House of some of the actions we have taken in recent years. We mobilised the entire resources of the State to fight the foot and mouth disease threat, which could have devastated Irish agriculture – this was an outright success; we put into immediate effect the cattle destruction market support schemes, involving the use of substantial Exchequer resources, to support the beef sector and producer prices during the BSE crisis of 2001 and 2002 – these schemes cost in excess of €400 million; we have adopted, and continue to adopt, a hands-on approach to the reopening of markets for agricultural produce, involving the full deployment of political, diplomatic and technical resources; we developed and implemented, at considerable expense to the taxpayer, traceability systems for cattle, sheep and pigs to provide state-of-the-art food safety guarantees for consumers of Irish products and provide a marketing edge in increasingly competitive markets—
I notice there are no figures in the Minister's speech.
—we put in place one of the most efficient systems in the EU for payment of direct income payments to farmers with the vast bulk of cheques now issuing on the first day allowed under EU regulations – no other member state administration matches this level of service; we negotiated, against all the odds, what has been universally acknowledged as a most favourable outcome for Irish farmers in the Agenda 2000 CAP reform; we copperfastened the Agenda 2000 gains in the recent Brussels summit decision on the future financing of the CAP securing direct payments to 2013; we successfully defended export refunds in the WTO negotiations at Doha; we are providing €2.8 billion in public expenditure to support the agriculture sector in 2003, of which €1.6 billion will be paid in direct payments to farmers – a similar amount was spent last year; we have continued to allocate substantial Exchequer resources to control animal diseases in the national herd – in excess of €200 million will be spent again this year; contrary to suggestions from some quarters, we provided increased financial provisions this year for the rural environment protection scheme, REPS, and the on-farm investment schemes and are committed to further improvements in these schemes; we operate the early retirement scheme and the young farmer installation aid scheme, unlike some other member states, and in addition we provide tax incentives and a full exemption from stamp duty to facilitate the early transfer of land to young farmers; and we published and implemented a long-term plan for Irish agriculture, the Agri-Food 2010 Report.
None of this detracts from the fact that following two good years, last year was a particularly difficult one for farming. By way of immediate response to the weather and market-related difficulties a series of special actions were initiated by the Government as far back as last May. I will spell those out again.
In 2002 we obtained EU agreement on a number of occasions to significantly strengthen market supports for dairy products. Refunds for skimmed milk powder, for example, increased on six occasions and casein aid increased by a total of 80%. I got Commissioner Fischler to make those amendments following representations made to me by the farming and dairy co-operatives. Dairying was still depressed last year and were it not for those improvements, it would be in a much worse position; we secured EU agreement to allow the use of set-aside land for grazing-fodder; we negotiated the lifting of the Russian county ban on beef exports; we obtained EU agreement to allow an increase by up to 30% in beef export refunds; we secured EU approval to have the advance payments under the bovine premium schemes increased from 60% to 80% this year; we brought forward, with EU approval, advance payments under the arable aid scheme; we made administrative changes to simplify the REPS, including investment by the Department of Agriculture and Food of €1.3 million to facilitate planner access to computerised mapping; we introduced improvements to the farm assist scheme; and we made changes to reduce the paperwork for farmers in applying for extensification premia.
Costing €13,000.
That was all done during 2002, going back to last May. Those actions were taken in response to the difficult weather and market conditions and they resulted in tangible benefits to farmers, although not as much as we would like. I welcome the sober and constructive attitude on the part of Opposition members, which is only right when we are dealing with a complex and difficult industry like agriculture and farming. We are not in isolation here in that regard. We have to compete with EU member states. We will have an enlarged Union in 12 months' time and we have competition also from third countries so it is an industry that has to be taken extremely seriously – I appreciate the seriousness with which the Opposition members made their contributions.
One of my main priorities is to continue to ensure the optimal framework for the development of agriculture and to seek the best possible supports to ensure adequate returns for the farming community. However, we have to recognise a number of facts. First, direct income payments support farmers' incomes to a very considerable extent. For example, direct payments have increased from €485 million in 1990 to the €1.6 billion paid to farmers last year. It is not accurate to say that product prices have not improved since the mid-1990s. Any decrease has been made up with increased payments in premia of various descriptions. I think it was Deputy Tom Hayes who said these subsidies and premia are important because they provide cheap food to consumers. I would prefer if food was much cheaper and I would like the farmers to get a much greater slice of the profit margin but our supermarkets are obtaining the largest slice of the profit from that whole operation.
They have been allowed to do it for a long time.
In relation to many of the products, that is up to 36% and what is left for the farmers is totally inadequate. Second, while these payments make up a considerable amount of the average farm income, farmers and processors in particular have not kept pace with the changes that have taken place on the farm. Compared to a decade or two decades ago, most farms are totally transformed. They are in pristine condition and they produce the highest quality products whereas in many factories, the position is roughly the same as it was a decade ago. That is not good enough because beyond the farm gate we have to maximise the profitability of the product and get that profitability in greater amounts back to the farmers. That is the reason I have initiated a study of the dairy industry. The study is complete and I should have it in the next two weeks because we need to keep pace with the very positive developments that have taken place at farm level.
Third, we have to recognise, especially when considering average incomes, the diverse nature of the farming sector, which is comprised of full-time and part-time farmers, and if comparisons are being made with other sectors, it is important to compare like with like.
On the question of partnership, there is no doubt that the poor weather and market conditions in 2002, a series of proposed reforms and trade changes at international level and the negotiation of a new national partnership agreement have made for an apprehensive time for the farming community. Every business wants a calm, predictable economic climate in which future plans can be made and brought to fruition and farming is no different. Farmers also need that security and stability.
There has been much talk about the social partnership talks, the manner in which they have been conducted and the draft agreements. I emphasise that in these national negotiations no group has received what they initially sought and those who have received awards, primarily in the pay area, must in return give significant concessions in terms of new work practices and productivity.
The farm organisations came to the negotiating table with a package of requests which in another economic climate may have been addressed, but as many of the pillars have discovered, such demands would have cost the Exchequer billions of euro in increased borrowings. Certain demands from the pillars were unrealistic in the current climate and could not under present economic conditions be conceded. I know the farm organisations would agree, as would the rest of Irish society, that there should be no return to excessive borrowing. We had plenty of that in the past and farmers suffered more than most.
On-farm borrowing has increased substantially.
Farmers were in extreme difficulty and some had to sell out because interest rates went over 20%.
On-farm borrowing—
Allow the Minister to proceed without interruption.
We do not want to go back to those high interest rates. The offer made to the farm organisations last Friday and again on Saturday is, within the context of the overall resources available and bearing in mind the budgetary situation, both imaginative and generous.
To indicate the comprehensive approach taken in relation to agriculture there are solid commitments on the CAP mid-term review, WTO, the dairy sector, the beef sector, the food industry, improvement in REPS, improvement in the farm waste management scheme, commonage framework plans, SACs, stamp duty and stock relief for young farmers and land annuities.
To give an example of the type of approach which has been taken by the Government, I cite the instance of the increase in the disease levies. Like any other consumer of services, farmers do not like to have to pay more. However, this increase in levies must be placed in the context of a steep rise in the cost to the Exchequer of disease eradication measures in recent years. Over €200 million was spent in the last couple of years on disease eradication. Up to now, €10 million was contributed by way of levies and that has now been increased to €20 million in an overall expenditure of €200 million.
Some of the Minister's colleagues, like Deputy Parlon, do not agree.
The 1996 agreement was mentioned earlier. I will quote from that agreement's subhead E: "For an extra year levies will be fixed on the basis that they will contribute £10 million per annum or 50% of the cost of compensation, whichever is the greater." Compensation last year cost approximately €50 million and 50% of that is a long way from €20 million. That was negotiated in 1996.
To alleviate the problem an offer has been made, within the partnership process, to the farm organisations to partake in a series of value for money reviews of expenditure. These reviews would take place this year to identify savings for both the Exchequer and farmers while protecting consumer health, animal health and animal welfare and complying with statutory requirements. Much progress can be made using this approach.
Another area where there is a large degree of misinformation relates to Brussels-funded schemes and the claim that hundred of millions of euro of EU funding could be lost to this country. It is true that REPS expenditure is behind schedule but this reflects low demand – my Department has turned no one away.
They were turned away by red tape.
There is time to rectify this situation and I point to this country's track record in drawing down such funding which is the envy of many other member states. Again, within the partnership process and with the draft agreement in place, there is a mechanism to draw down the maximum level of funding and to optimise the spending of EU and national budgets. Ireland's reputation for drawing down every last possible cent of Brussels funding will, with the full co-operation of all parties, be maintained. There will be no loss of revenue from Europe whatsoever.
It is no secret that the current round of partnership talks have been difficult but we have had many difficulties since the instigation of the whole partnership process in 1987. I remind Members of that date, 1987, as this process has been in place for the past 16 years and has helped to contribute to a dynamic turnaround in the economic fortunes of this country and gains for all sectors. The partnership process has served this country well and partnership has served farmers particularly well. I applaud their contribution to the partnership process over the years and their input into the series of previous agreements. I, like all my other colleagues in the Government, would like that input to continue.
I have heard talk of pillars in this present process being removed and pushed out of partnership. This is not the case and I hope all the pillars can sign up to the newly negotiated agreement. There are difficult choices for the farming organisations and some aspects of the agreement may not suit them. Similar choices are faced by all the pillars, which, in a difficult budgetary climate, may have to accept that the resources previously available to them will have to be restricted. However, by signing up to this agreement their input into partnership is not restricted. Through mutual agreement with regard to priorities and resource allocation, this country can ride out the present externally unfavourable economic weather and restore Irish growth to its previously high levels.
Another aspect to the document on the table is also being overlooked. There is an overall issue that is more important than what is available for a particular industry, sector or group. The overall goal of the process is to continue the progress of Irish society as outlined in the NESC vision. This outlined a view of the continuation of Ireland's economic success and a nation that will be economically inclusive based on full employment and which will also continue a trend of consistent economic development, be socially inclusive and continue to adapt the country to change. It is appropriate to quote from the overall approach adopted in the proposed agreement to underpin national development:
The degree of uncertainty about the economic outlook, both domestically and internationally, and the reality of a fiscal environment in which current constraints have implications for prioritisation and timeframes for delivery across policy areas and programmes, have resulted in a different approach being taken in the development of this agreement.
The achievement of the general overall measures within the new programme and within current resources is just as important as any sectoral measures. Of equal significance is the fact that measures that have been taken in this programme will, among other things, protect the general well-being of the economy which is, of course, of primary importance to farmers as it is to other sectors and will result in higher economic growth, lower interest rates and lower inflation.
In addition, the farming community has a vested interest in many of the ten special initiatives being undertaken during the period of the programme. These include the cost and availability of insurance – which is very important – tackling educational disadvantage, ending child poverty, care for people with disabilities and older people, and waste management. In the case of each initiative there is the need to put in place appropriate arrangements involving all the pillars to develop these initiatives further. The successful implementation of these initiatives will make a major contribution to our quality of life. All major stakeholders in society must contribute to this process and it is for this reason that partnership involving all four pillars is so vitally important.
There are very serious issues being raised in relation to the manner in which agriculture is supported in the context of the mid-term review proposals and the WTO negotiations. Those are challenges facing agriculture and the combination of those sets of negotiations could have a profound effect on the future shape of EU and Irish agriculture. It is vital to remain focused on these major drivers of change, while enlargement of the EU will also be an issue next year. In the mid-term review we have decoupling and modulation, both of which have to be tackled. We would bear a disproportionate cost compared to other member states because of our dependence on agriculture and any supposed increases in prices will be negated by the WTO, which may well support and dilute tariffs. There would be increased imports into member states, including Ireland, so there are no guarantees of an increase in prices as a result. I made this point strongly in the Council of Agriculture Ministers last week and my colleague, the Minister for Foreign Affairs, also took action in the Foreign Ministers' Council last week, which I shall describe later, to protect vital Irish interests.
In relation to the WTO, the current round of negotiations is reaching a crucial stage. Last week the EU position on modalities under the new round was agreed at the meeting of the Foreign Ministers' Council. Political endorsement of the EU position on modalities was necessary in order to demonstrate to our WTO partners the determination with which we will engage in these negotiations. That endorsement was also necessary to strengthen the Commission's hand in the difficult negotiations it faces in Geneva.
For these reasons, I insisted, together with my French colleague, that the Council should discuss the Commission paper. The discussion took place last week in the Foreign Affairs Council where Agriculture Ministers also discussed the EU position informally.
In the Foreign Affairs Council, the Minister for Foreign Affairs managed to secure a Commission declaration to the effect that specific tariff reductions under a new WTO round, which are a matter for internal EU decision, would be submitted to the Council for agreement. The Commission will remain vigilant with regard to the negotiations concerning products which are exposed to international pressure and, furthermore, will give special consideration to sensitive products.
Ireland must be extremely careful in this area. Though we are a relatively small country, we import a substantial amount of food products. Last year, for example, we imported €1.8 billion worth of food products. Some 12% of the beef consumed in Ireland comes from outside the European Union as do a substantial part of our poultry and pig meat products. We need to ensure that Bord Bia's Feile Bia programme is observed and that Irish consumers at least inquire when they go to hotels and restaurants as to the origin of the food products they consume. There is no other way because Irish people import, distribute and consume these products. We must be vigilant with regard to these products because of the substantial imports and we want to reduce rather than accelerate the level of those imports.
What is the quality of imports?
I inquire about this on a regular basis in Brussels and Commissioner Byrne, who is responsible for food quality and consumer matters, has assured me that quality is to a very high standard, equivalent to that of Irish food. The Commissioner also assures me that, on a regular basis, inspectors from Brussels visit countries that export to the EU to test the products concerned at various plants to ensure they are free of harmful residues and are processed according to the standards we would insist on in Ireland.
They use hormones while we do not.
Any country in which hormones are used is excluded from exporting to EU countries. We insist that no hormone produced products are admitted for sale to the EU. There is a section of the Commission, under the aegis of an individual commissioner, to ensure that continues.
With regard to the WTO, I am now satisfied with the negotiating position the EU has taken on modalities. I would not underestimate the difficulty which the EU faces in the forthcoming negotiations, the outcome of which has the potential to create the conditions for further major reform of the Common Agricultural Policy. I am not convinced of the need, for either internal or external reasons, for the EU to embark on any significant reform of the Common Agricultural Policy at this time.
The point has been well made, including by Deputy Timmins, that farmers are entitled to security and a period when they can plan ahead, and they have been asked to do that by Dublin and Brussels. Agenda 2000 was negotiated and put in place in 2000 to last until the end of 2006 yet, in 2002, there were proposals for a major reform of the CAP. Those proposals were put on the table last week in Brussels and not only do they involve major reform, but they totally change the traditional way in which farming and the agricultural industry were supported.
De-coupling is a classic example of a major change in the underlying support for farming in that traditional farming is expected to be discontinued, and a cheque is to be issued once a year without any need for production. That would have an extremely detrimental effect on farming, farm supplies, co-op supplies and all the upstream and downstream parts of the industry, not to mention the damaging effect on our processing industry. That is why I vehemently opposed those proposals.
I saw a poll in the Irish Farmers' Journal last week which suggested that a substantial number of Irish farmers were attracted to some of these proposals.
That is because they are fed up with the bureaucracy that is driving them to it.
It could be attractive as a redundancy type payment to those who want to get out of farming for one reason or another, and it might suit those who have another job so that they do not have to tend livestock. However, that is short term. We have an important and worthwhile industry to support and it should be supported. With the Agenda 2000 regime in place up to 2006, this is no time for radical reform.
From the point of view of the WTO, Agenda 2000 was designed specifically to prepare for the current round of negotiations and it can hardly be strategically prudent to embark on a further round of reform before we know the likely shape of the WTO round. The CAP was reformed in Europe in 2000 to prepare for the next round yet, before the next round has even begun, there is a further attempt at reform.
Last week in the Council, I strongly opposed the Commission's proposals on the mid-term review. I will continue to seek to preserve the benefits to the Irish agri-food sector which were negotiated under Agenda 2000 and to secure the best possible support for Irish agriculture and rural communities in the years ahead.
It lacks credibility to suggest that the Government is anything other than fully committed to the agriculture sector. The focus on agriculture, given its importance to this country, is welcome. We seldom get a chance to discuss farming and agriculture in the House and, for that reason, this debate is welcome and that it has been so constructive is more important again.
We need more Government time.
That is because we are facing a period in which there will be immense change. Agriculture, in both practical and policy terms, has become much more complex. The external environment within which it operates is subject to rapid change and the scale of change over the next few years will be greater than anything the sector has faced since we joined the European Community 30 years ago. The combination of CAP reform, the WTO and enlargement will mean that the sector will be operating in a completely different landscape in a few years. We cannot and should not close our eyes to these changes. We should and must prepare to ensure that the sector can prosper in the years ahead. This is the real challenge which requires leadership, vision, optimism and confidence.
Agriculture is central to economic and social life in this country. The Common Agricultural Policy has had a significant and positive impact on Irish farming. Apart from the support and market opportunities which it has provided, it has encapsulated the vision of agriculture which the Government, the farming sector and society in general share very strongly. This is centred on sustainable family farming, which protects the rural environment and provides safe food. This is the basis on which the sector merits such strong public support from the European taxpayer. Against a changing background we have a clear vision for agriculture. It is one where the sector remains our major indigenous industry, which is competitive and sustainable and which provides good, wholesome food from a clean environment.
Those involved in the industry must earn a decent living. I visited an agricultural college yesterday to give out certificates to farmers. Despite all the bad-mouthing of farming, more young men and women are attending agricultural colleges than ever before.
That is rubbish.
I was pleased to hear a representative of one of the farming organisations who gave a special merit award to a graduate, say that he had five sons and one of them stayed on the farm.
We have been too soft on the Minister.
He said that son was the best off of the five, despite the IT sector, dot coms and everything.
At the rate jobs are being lost, that might be right.
In an international context we must and will negotiate with our usual sense of focus, determination and unity of purpose. Our track record proves that. As well as negotiating, it is my job and that of the farm leaders to help prepare and position the industry to adapt to the changing circumstances. In many ways, that is the most profound challenge for the period ahead.
I wish to share my time with Deputies Moynihan-Cronin and Sargent.
Is that agreed? Agreed.
I cannot claim to make any great political capital on behalf of my constituents in this debate because they are not worried by the immediacy of agriculture. However, the spin off from what will happen in agriculture will be of great significance to them. Our only claim to the immediacy of agricultural production or profit in the area is that we have a thriving equine centre. They will be concerned about the quality and safety of our food and about job losses in the processing industry. All these issues will have a direct impact on them.
I want to refer to the recent farm protest at the beginning of January. That highlighted a number of issues of which we should remind ourselves in our debate this evening. Those issues have not gone away. Farmers do not have an average income of €45,000. Farm incomes were down by approximately 8.5% last year. The Book of Estimates and the budget were a combined slap in the face to farmers, particularly in light of the poor year they had in 2002. Doubling the disease levies has been a cause of major problems for farmers. Instead of doubling the disease levies, we should consider something to which the Minister alluded, namely, the eradication of such diseases. We should concentrate on ensuring we get rid of diseases, such as brucellosis and TB.
I am also concerned about the drop in the budget income for Teagasc. It is retrogressive and negative to take away a budget in the area in which we will need it most in the coming years, namely, the advisory services, research and training. I am concerned about the proposal during the week to consider closing Mellows College. It is the only college which undertakes significant organic farming, production and training. This is a niche market which should be examined, promoted and marketed aggressively rather than looking at it in a negative and retrogressive way and considering closing it down.
The differential between the price the farmer gets for the raw material and the price paid by the consumer is alarming. It seems the supermarkets gain most. Farmers get approximately 38% of the retail price. Some 62% of the value is mopped up somewhere along the way. Even allowing for the cost of slaughter, overheads, distribution etc., there is still a huge gap. The middle men are doing well, while the producer and consumer are badly hit. I raise this issue because the Minister should ask questions about this practice from the Director of Consumer Affairs and the Competition Authority. He should inquire where the piece in the middle goes and who benefits from it. He should find out why there is such a small take for the farmer and such a high payout by the consumer at the other end of the chain.
There is no doubt that farm incomes and life in rural Ireland have changed significantly and will continue to change even more significantly in the future. The Minister and I are at one on that and we both agree there are challenges which must be addressed. It is important that farming is secured where it is strong and viable. There must be diversification of rural employment options and the rural population must be retained through resource-based development in other sectors, such as forestry, marine and natural resources. If I am listening to Mr. Fischler correctly, he does not seem to be interested in forestry. He does not seem too concerned about developing that as an option.
Areas such as tourism in rural Ireland must be supported and enhanced. Rural towns must be supported with the labour supply and skills which will complement rural development. In that regard, there is a strong market for organic farming if it is properly developed and aggressively marketed. We pride ourselves on our image as a clean green country. We should capitalise on that as a niche market. I am not suggesting nor is it viable that the entire country turns organic. However, it is negative to consider closing Mellows College when there is a strong niche market for that type of farming.
Small farm holdings are becoming less viable. Increasing the size of holdings is the only reasonable and economic way to provide a viable future for farm families. However, small farmers should not be sacrificed to the larger enterprises. That is where I believe new ideas must come forward. Off farm work must be highlighted. We must link that with local infrastructure and we must see how that can be accommodated.
I mentioned research and development. We will depend more on good research and development programmes and on education programmes which the Minister mentioned. I was interested to hear him say that of the family of five, the farmer is doing best. He may be a protected species. I was surprised to hear that because most of us are aware that fewer young people are going into farming. The intake in the agricultural colleges is skewed because of the interests people are pursuing, such as in the equine area, rather than going into farming directly. We must be clear about what is happening in agricultural education. It is not fair to say that young farmers are the most lucrative compared to their brothers who take up alternative employment.
Deputy Enright mentioned bureaucracy and red tape. Farming has been strapped by bureaucracy and red tape, although some of it is necessary and essential. I would be the first to call for traceability and accountability. However, there is an enormous demand on the time of the farmer to complete the plethora of forms. Simple mistakes must be treated in a reasonable way rather than getting dug in and imposing fines and penalties. One of the positive things which may emerge from the Fischler proposals is that we might have less red tape and bureaucracy. However, I am afraid the current red tape might be replaced by a different type of tape. We might have alternative bureaucracy.
There is a need for some adjustments, I agree with the Minister to some extent in that regard, but it is a matter of how these adjustments will be implemented without damaging the nature and quality of farming and farming life. Subsidies must remain an integral part of Irish farming. It would be impossible to implement environmental policies or to sustain marginalised farms without subsidies. Transitional payments must be in place to safeguard the current generation of farmers, while allowing the transition to a new generation which must take on board the new styles and standards which are almost inevitable in farming.
Research, development and education cannot be sacrificed because that is the basis on which the change can occur with as little pain as possible and a positive outlook for future generations. It is up to the Government, particularly the Minister, to define how those changes will take place and to protect agriculture while that is happening. The scene must be set for gradual change which will give a new look to farming without damaging the quality of life or the acceptable level of income for farmers.
I welcome the opportunity to contribute to the debate tonight and I commend the Fine Gael Party for tabling the motion. I am not able to discuss it in great detail as I do not have enough time. Everybody has mentioned the recent tractor protest. If it did nothing else, it brought the issue of the decreasing income in farm families to the top of the public agenda – for the first time the public is behind the farming community – but, unfortunately, it did not bring it to the top of the political agenda. I was disappointed in the Minister's speech tonight. When the farmers took their tractors to Dublin in the first week of January, the Department of Agriculture and Food, the Government press office and the Government backbenchers were wheeled out to list off the figures about investment in agriculture in recent years.
However, the Minister missed the point. He repeated the same presentation tonight but both he and Government backbenchers failed to mention the Book of Estimates and cuts in Government expenditure. This relates to domestic politics. I will not deal with European issues as the negotiations in that regard are ongoing. I will list some of the cuts in the Book of Estimates. Under the heading of education, research and advisory services, there was a 24% cut in research and testing and a 13% cut in grant aid to Teagasc. Under livestock improvement, the budget for the cattle breeding authority was reduced by 11%. Grant aid for Bord Glas was cut back by 32% and by 13% for Bord Bia. The budget for REPS was cut by 19% while technical assistance for rural development was slashed by 85%. On-farm investment is down 58% for 2003. The budget for agricultural development under the national development plan was cut by nearly €25 million while the scheme of installation aid to young trained farmers has been savagely cut by 75%.
What kind of commitment is that to agriculture? I have been meeting farmers recently, individually and at meetings where the absence of Government representatives told its own story. While farmers may be disappointed in the Minister for Agriculture and Food and his Department, they are doubly disappointed in the Mini ster of State at the Department of Finance, Deputy Parlon, who voted for a Book of Estimates containing those cuts, having spent years lobbying Deputies on behalf of farmers. I recall meetings of farmers at which politicians were attacked by the Minister of State in his former role as a farm organisation leader, yet he voted for the Government cutbacks. Farmers will look with interest to how he will vote on this motion tomorrow night.
It is difficult for Government representatives to understand what farmers are experiencing if they will not even meet them. They should meet the farmers, who are very decent people, and hear their concerns. Farmers are not interested in whatever investment took place in the past. Their concern is for their future, which looks very bleak. I have listed the cuts in the Book of Estimates. Farmers are also concerned about CAP reform and the World Trade Organisation trade negotiations. They are also worried about the national pay talks. I support the call by the IFA for intervention by the Taoiseach. Like a three legged stool, this process will fall without its fourth leg. I urge the Minister to persuade the Taoiseach to intervene. The farming community, which has been through good times and bad, should be properly looked after in the national pay talks. The issues which the farmers have raised are not huge.
The Government claims that times are bad and refers to economic difficulties. The situation need not be so bad if the Government was prepared to use the money available to it. The people will not be fooled again. They know what the Government is doing. Notwithstanding current Government statements on the difficult state of the economy over the next three or four years, there will be no shortage of money at that stage to buy the next general election as the last one was bought. The Government should put its money where its mouth is and look after the people of rural Ireland.
Ba mhaith liom, ar dtús báire, buíochas a ghabháil le Teachtaí an Pháirtí Lucht Oibre as ucht a gcuid ama a roinnt liom anocht. I speak on behalf of my constituents as well as farmers generally. A number of my constituents participated in the recent tractorcade. They feel disillusioned because they have not been listened to and have not been getting what they would regard as fair results from the partnership talks. They are focusing very much on CAP reform, which gives an air of uncertainty as to the future of farming. On the basis of experience, the CAP has not worked in the manner which was advertised following its establishment back in 1957. The then six EEC member states had 22 million farmers. The present larger European Union now supports less than 7 million farmers and the trend is towards further loss of numbers from year to year.
In that scenario, one might expect that the remaining farmers would have a higher income, with more to share between fewer people. However, that is not the case. Income and living standards were down 20% in 2002, according to IFA figures. If we take the average industrial wage as a reasonable living income, average farm income is about half that level. I am not convinced of Government sincerity in its concern about farming. The evidence on the ground, according to IFA estimates, is that a further 15,000 farmers will be forced out of farming. That does not reflect well on the Government.
In relation to the reform of the CAP, there is clearly a major challenge ahead. The CAP has not been working and the reforms will have to involve far more than paying for the type of destruction schemes in relation to which the Minister mentioned a figure of €400 million. Money is being pumped into farming but the long-term effect has not been to guarantee a future for farmers. Of the organic food consumed in this country, 85% is imported. Why is the Government ignoring Bord Bia's forecast that production will rise by 30% per year over the next three years? The Irish market for organic produce is currently worth €20 million to €25 million per year and there is clearly huge potential. When my party published its organic food and farming targets Bill in 2000, we asked the Government to adopt a targeted approach. That has not been done. Denmark gives 100 times more support to organic growing than Ireland. I have spoken to conventional farmers who want to get into organic production and are afraid they will be left high and dry by a Government which does not take that conversion process seriously. The fiasco in relation to the closure of Mellowes College is a clarion call to farmers not to be tempted by organic farming under those circumstances. That is the message the Government is sending out. I ask the Minister to intervene to have Mellowes College kept open.
The forest service, when contacted by farmers, is unable to state what is the status of the native woodlands scheme or the neighbourhood scheme. The nursery sector of forestry has been losing business and farmers are losing faith in the forestry aspect of farming which had been heralded as an alternative farm venture. The Minister should take stock of this and address the issue.
This country has followed a path of intensification in farming. This has suited the large multiples by allowing them to charge the profits which farmers do not receive on the basis of low farm prices. What we need is a greater level of extensification, having regard to the available land area. Land lying idle in arable setaside could be put to better use in, for example, free range poultry production. I urge the Minister to follow the extensification rather than the intensification route and choose localisation rather than globalisation. We need to be prepared for increased transport and production costs as part of the energy crisis which is around the corner if there is a war in Iraq. The situation must be addressed whereby the large multiples are taking an ever increasing share of the food retail market. I propose that consultation take place with the various parties in this House and farming and consumer groups to build support for a successor to CAP which will reward farmers and protect the environment.
