Dáil Éireann díospóireacht -
Thursday, 19 Feb 2004

Vol. 580 No. 3

An Bord Bia (Amendment) Bill 2003 [Seanad]: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Mr. Boyle

Before the start of questions to the Minister for Education and Science, I was outlining the reasons that the Green Party opposes this Bill. The intervening hour and a quarter has not changed our position. This Bill seems to have been formed through the Department of Finance. The Department was asked to make savings and rather than think strategically of the needs of Irish agriculture, the civil servants in the Department have instead chosen to see what could be done administratively to make the savings being demanded of it. Ultimately, that lack of a strategic approach will be to the disadvantage of all involved in Irish agriculture, from the individual farmers to the consumer, in whose interest the issue of food quality rests, if there is no confidence in how food is produced and how high quality food is marketed, not only in Ireland but abroad.

The Government must be taken to task for that lack of a strategic approach. I highlighted how food agencies have been far too timid in challenging other aspects of Government policy outside incineration and their effect in undermining food quality in Ireland. However, it seems that for those involved in the administration of Irish agriculture, the best strategy has always been to keep one's head down rather than be innovative and bring about changes for the betterment of Irish agriculture and the quality of Irish food. It is not unfair to say that the Department of Agriculture and Food, in its previous forms, when it included the Department of the Marine, was traditionally the most conservative of Departments. As we face a new century and the new reality of the accession of ten new countries into the European Union and the challenge of where food is likely to be produced within the Single Market of the European Union, rather than face that challenge the Government is instead deciding to retreat into a shell, returning to traditional formats and failing to look at the innovative approaches that we need to produce different and better types of Irish food that can be marketed differently.

From a green perspective, the ultimate disappointment with this Bill is that the organic sector is once again being left aside in how it is valued within the agricultural sector and how it is likely to be promoted. It is particularly disappointing from the Minister's point of view since, to be fair, at least in the past 18 months, because of changes proposed to the Common Agricultural Policy and the nature of negotiations going on in the World Trade Organisation, the Minister has been coming around to the realisation, and articulating in this House, that we need better quality Irish food achieved through better support for the organic sector. Yet in front of us we have a Bill that totally negates that approach. The Minister's words in this House ring ever more hollow because of a failure to follow through with an appropriate administrative structure. The Green Party believes that, if we truly wish to support the organic element in agriculture and its horticultural component, there must be a specified, stand-alone agency. Bord Glas is the obvious vehicle to help that movement forward. The Minister, in summing up this debate when we finish Second Stage, might argue against many of those points.

Aside from what he is proposing in the Bill, which is ultimately administrative, the real challenge facing the Minister, who has been in office for such a long time, is the mind-set that permeates agriculture. On Tuesday, the Irish Farmers Association held a large-scale lobby on the effects of the nitrates directive. On the surface, trying to live up to the directive will cause inconvenience because it requires new practices in agriculture and involves costs. An innovative Government would have risen to this challenge. Rather than placing the burden on the agricultural community by stating it must live with the costs, it would have structured the introduction of the directive in such a way as to combine appropriate incentives with recognition that current farming practices, particularly the use of nitrates and nitrate loads on many farms, cannot continue.

The leadership style chosen by the Irish Farmers Association is an issue, but part of the problem lies in the Department's lack of willingness to properly interact with and confront the relevant issues to ensure the introduction of the necessary changes, whether for environmental purposes or to sustain agriculture in the future. The silence of the Government on this issue is disappointing.

It is important from a food quality as much as a water point of view that we get the nitrates directive right. Ultimately, the disappointment and anger expressed by the farming community is matched and mirrored in the disappointment of many citizens who believe we have a high quality environment which we should do our utmost to enhance and protect. The food quality agencies have been silent on this matter and have shown an unwillingness to state what needs to be stated on these issues.

Part of the reason for establishing stand-alone State agencies, as articulated by Ministers in the past, is the freedom to make policy and statements which would not politically compromise Ministers or Governments. The conservatism of the Department of Agriculture and Food appears to be matched by the conservatism of food agencies such as Bord Bia. If the Minister was intent on shaking up the food marketing and quality elements of State bodies, he should have adopted Deputy Upton's position of establishing a wide-ranging organisation encompassing all elements of food.

There is a fear that separating fishing from the food promotion element of Enterprise Ireland, and submerging Bord Glas in Bord Bia creates two-headed monsters, to the extent that the interests represented by Bord Glas, namely, those of the horticultural industries, will not only take a back seat, but may disappear from the screen. Those of us who oppose the Bill and the merger of these two bodies believe the move will not deliver a new super-agency, but that Bord Bia will do what it has always done, with the same emphasis and priorities. The Minister has yet to articulate how the interests represented by Bord Glas will be represented in the new body.

Like other speakers, I am loath to address the composition of a board whose establishment I oppose in the first instance. It needs to be re-emphasised, however, that the commitment of Government towards gender equality and balance in State bodies and agencies in general is mealy-mouthed and needs to be specified. I am disappointed that we suddenly appear to have lost sight of the 40% quota, which has been stated Government policy since the mid-1990s. As the finance spokesperson of the Green Party, I have been arguing with the Minister's colleague, the Minister for Finance, on the issue of gender balance on the board of the Irish Financial Services Regulatory Authority. One continually hears the argument that it is difficult to find qualified women in various areas. The Green Party and many members of the Opposition will not accept that argument from the Minister in this case because the growth in part-time farming on family farms has resulted in female dominance in the area of food marketing.

If ever there was a case for specifying a gender quota on a State body, this is it. I would even argue that the new body should be the first State agency with a majority of female representation given the manner in which the industry has developed in recent years. That is particularly true of the horticultural sector and for this reason I ask the Minister to specify a quota for female representation on the board should the Bill be enacted.

To allay the fears I have expressed, the Minister should also give appropriate recognition to the role of the horticultural industry by specifying that the new body include a quota of persons who are involved in that sector. The same should apply with regard to organic activities and marketing. If the Minister fails to specify the areas which should be represented on the board, the final result will be the appointment of a group of people by the Minister, some of whom will have direct experience of the general agriculture industry, but many of them will have the coincidental advantage of membership of the Government parties. In such circumstances, we would not know whether the board selected would benefit agriculture and society.

The Green Party opposes the Bill because it is motivated by cost and administrative considerations inspired by the Department of Finance. It also fails to appreciate and enhance the role of horticulture in the agriculture industry. If a new body and administrative structure for the board are established, they must recognise the contribution of women as well as those involved in horticulture and organic industries. Only then should the marketing element be considered in the formation of the board.

While I am not optimistic that the Minister will accept any of my proposals, it is important to place on record that the Government cannot take pride in this Bill, and the House should not be spending time on it. Instead, the Government should introduce more productive legislation on other aspects of the agriculture industry.

Mr. Dennehy

I will first address several of the points made by Deputy Boyle, who argued that the Bill will be a disadvantage to everybody, including farmers. He criticised the agencies involved for failing to comment on certain issues and suggested the House was wasting time dealing with the Bill. We spent much of the past week discussing the Eircom issue, which has become fairly dated. Members will have received a letter from the Communication Workers Union yesterday castigating the Green Party.

It states, "The Green Party says it wants to encourage more employee share ownership schemes."

It goes on to state that if that is the case then the party should learn more about them. It continues:

Attacking the Minister on the basis of the information obtained, without attempting to get a full understanding of the facts, is politics of the worst kind. Eircom workers and indeed retired Eircom staff deserve better than this.

That is the kind of comment one will hear when these people act on an issue and rightly so if what we just heard is anything to go by.

This may appear to be a Bill of little significance and dealing with a topic of limited interest. One of my colleagues expressed some surprise when I expressed a desire to speak on the Bill and he inquired as to my interest in the subject.

Mr. Hayes

I could see from where he was coming when the Deputy started to speak.

Mr. Dennehy

I have a great interest as a consumer and also as a public representative and a taxpayer. It is a very important issue and everybody should have an interest in it.

I subscribe to the often-expressed view that, with proper organisation Ireland could, and should, be feeding half of Europe. This is a very significant Bill and I am hopeful it will lead to a new approach to some aspects of the food industry, particularly in the area of horticulture, which was mentioned earlier in the debate. A dedicated subsidiary board will be established within the new Bord Bia to cater for horticulture. Many of us were concerned that horticulture would be submerged within the new body. Unfortunately, instead of being able to achieve the objective of feeding half of Europe, we appear to be at a point where we cannot cater for our own needs, particularly in a range of horticultural products. This is an area in which we should be leading the market. I do not know who is to blame for that situation and I have no intention of trying to apportion blame, but things are not right in several aspects of the business. It may be lack of co-ordination at national policy level, an unwillingness to work hard enough at some other levels, climatic difficulties, or simply a case of there being easier ways of earning money other than the hard slog and uncertainty that goes with the growing of the produce. However, I am not in any position to be judgmental. Whatever the reason, it appears we are losing the battle in some areas of the fruit and vegetable business. Regrettably, areas with a tradition for growing fruit and vegetables, such as Wexford, north County Dublin and seaside areas such as west Cork, seem to be fading from the scene as major players. I am hopeful that this new body will help to get all of those growers back into the scene in a bigger and better way in the future.

When we question how the changes in the process came about, there always seems to be an answer that more or less suggests the issue is beyond our control. For instance, on the importation of potatoes the excuse usually given is that we cannot compete with the sunny climate in Cyprus and yet there is no mention of the cost of transport. The difference is that the product from Cyprus is invariably presented in a particular fashion. It is clean, graded, packed so that it is plainly visible for examination and the customer can easily confirm that it is in good condition. In my limited experience, I believe the customer is now willing and able to pay extra for such guarantees of quality.

Deputy Timmins referred to the growers in east Cork. They put a significant effort into grading and cleaning the produce. Unfortunately, the project did not succeed, but projects such as this will need to become the norm rather than a rarity, and not be confined to any particular geographical area.

There will be similar excuses given in respect of many other food items, even though they may have to be transported thousands of miles in 40-foot containers before arriving at Dublin docks, Ringaskiddy or elsewhere. The latest cover-all excuse is that the major players, who control the superstores, want to import everything. These major players are all hard-headed business people and if given the right product, at the right price, will do business locally.

Ireland can and should be a world leader in many of the agribusiness areas. Many of the reasons for not being so do not stand up to scrutiny. Transport costs, for instance, have been coped with by many other countries in this regard. It has been possible for Holland, a relatively small country in geographical terms, to capture the bulb market for most of Europe. Israel, despite all the difficulties it faces and the potential excuses that could be put forward for not being able to do so, can fly plane-loads of fresh flowers through the night to Covent Garden and other British and Irish markets. These are just a few examples of people surmounting great difficulties and I believe that we can do the same in the agrifood business if we show the commitment.

We can supply the product, we have the knowledge. We have the culture that is required, particularly in the meat section of the business, but we need to apply that same drive, expertise and commitment to all other sectors. Despite the proven success of the big operators in the meat sector, we must find some way of encouraging the smaller producer in horticulture. Big is not always beautiful. I do not know what acreage of glasshouses would be required to make someone a viable operator in that sector but we should not adopt an attitude of discouraging producers just because they are not in the super league, as seems to have been the case previously. This is an indigenous business with significant potential. Hundreds of families were able to make a living from it, particularly in north County Dublin. While I accept it would be difficult for a family to do that now, we need to preserve and enlarge the business, rather than reduce it.

There are health-related, employment-related and economic reasons, including the balance of payments, why we should make people more aware and more supportive of the Irish product. We must be able to indicate to people whether or not a product is Irish. We allowed EU regulations to be used in far too rigorous a fashion to prevent us identifying this fact very clearly. Our neighbours across the water never seem to have any problem in getting around obstacles like that.

One of the primary benefits of this Bill is the pooling of resources and expertise that are present in both Bord Bia and Bord Glas at present. Bord Bia has offices in most EU countries and the combined expertise of the amalgamated body will bring together the necessary expertise that will promote the entire food and horticultural industries at home and abroad. It is ludicrous to suggest that Bord Glas could do that business. I am pleased that the interests of concerned stakeholders, staff and the horticulture sector are being adequately safeguarded in what is an extremely important industry for our economy. The Minister detailed in his opening statement how that was being achieved. The representations by the various interest groups were catered for. It is worth remembering that the agrifood and drink sector accounts for more than 8% of Ireland's GDP, 7.1% of Ireland's exports and 10% of total employment. Its importance to the economy cannot be overstated and we need to market it in a professional and modern manner.

We are often told that agriculture is a declining sector in terms of its economic importance. Far from seeing the decline in traditional patterns of employment in agriculture as a negative factor, we should see it as the ideal opportunity to re-focus our employment strategy and to build on our core strengths. Several speakers made that point regarding additional activity to compensate for other areas. Agrifood accounts for 25% of our net exports and is central to the economic well-being of the State.

The accession of ten new member states to the EU, all of which have considerable horticultural industries, will present further challenges and opportunities. The methods used to market our agrifood sector ten years ago may no longer be appropriate. One of the points made by Deputy Boyle was that Bord Glas has been in place for just ten or 12 years. Things are changing by the month, let alone by the year, so it is time to make a move. The amalgamated body will have the dynamism and expertise to confront the considerable challenges that lie ahead.

I am glad to have this opportunity to speak about the labelling of food, which I have felt strongly about for some time. When one is in a supermarket nowadays, it seems as if half of the food one sees is labelled as "home-made" or "farmhouse". These terms have become so widely used that their effectiveness is now devalued. If we do not successfully regulate this area, I worry that we will be left with an extremely cynical consumer base. I would like the newly constituted Bord Bia to engage in an aggressive marketing campaign to promote the best of Irish produce. Labelling and presentation must be rigorously accurate if consumers are to have confidence in the products they are consuming. The Minister, Deputy Walsh, will be aware of a product produced in his area which is sold under the brand name of his home town. People throughout the country can identify the product they want and will ask for it on that basis. This is how many other products should be sold.

I recently discussed with a colleague the subject of the importation into this country of Argentine beef. While I have little doubt as to the taste and quality of such beef, as a layman I feel there is nothing to beat a piece of prime beef from the Golden Vale. While I may not always be able to identify a piece of Argentine beef, I am sure that I know Irish beef at all times. Indeed, I can almost tell the difference between Cork beef and beef from other counties. When consumers, including tourists, order beef in restaurants in this country, they are unwittingly ordering imported beef. It is scarcely credible that this should happen in a country which arguably produces the best beef in the world. A great deal of work is being done to promote Irish beef abroad, but the home market cannot be forgotten about.

When one has the best product in the world, one should shout it from the rooftops. There are many ways of getting this message across without being in conflict with EU directives. Under the terms of the Féile Bia scheme, which is run by Bord Bia, people can sign up to a charter to assure customers that the beef being served is of Irish origin. The appropriate, catchy and simple slogan Great Food — An Irish Tradition is used for the Féile Bia scheme. It is an excellent slogan as one does not have to say much more. It could be varied slightly to be applied in other areas. I encourage the Minister to ask his officials to pursue this matter. We may be too worried about EU regulations in such a context. We saw last week that the GDP pact, relating to 3% of expenditure, was changed, three years after we pointed out that it needed to be amended. There is a need for flexibility in this regard.

It has been suggested that the catering facilities at a number of IFA gatherings, one of which was in Wexford, did not comply with the terms of the Féile Bia scheme. It has been said to me, as Chairman of the Joint Committee on House Services, that the restaurant in this building is not part of the Féile Bia scheme, but this is not accurate. The Dáil has signed up to the scheme and a sign showing the charter is on display at the entrance to the main dining room. I commend Bord Bia for the job it has done to date. I urge the Minister to dedicate even greater resources to this area as I feel that it can generate considerable benefits for the domestic economy.

As a public representative who has spent his political life promoting co-operation between North and South, when I have had the opportunity to work at that level, I feel that there is no better example than the agrifood industry of a sector in which the interests of all parts of the island can be promoted together. I was profoundly disappointed when the Executive in the North ground to a halt earlier this year. It is my firm belief that the cross-Border bodies provided for in the Good Friday Agreement are in the interests of all Irish people. There is no logic in having a food promotion body in the South that exists in direct competition with a similar body in the North. This is surely a natural area of co-operation for our mutual benefit. I urge that an all-Ireland approach to the promotion of our agrifood sector be adopted. We used to have to worry about levies etc., but I do not believe that such difficulties continue to exist. We must work more closely with our counterparts in the North as we are now doing successfully in respect of tourism. Those on both sides of the Border share a common island and should have a common, all-Ireland, approach to global marketing.

It is disappointing that there are separate farming unions North and South of the Border. The problems faced by farmers who live in my constituency of Cork South-Central, 37% of which is rural, include acquiring reasonable prices for their products and dealing with EU regulations. I am sure that such problems are also faced by farmers in the Lagan Valley. Although we are separated by a Border, we are not prevented from working together and we should not be concerned by it. Ireland should be marketed, in big letters, as a single food-producing entity.

A previous speaker — perhaps it was Deputy Timmins or Deputy Ferris — said that the quality of Irish produce is recognised worldwide, but this is not the case. Perhaps it is recognised in places where we promote certain aspects of it, but I do not believe we are getting full value for the standard of the produce we export. I do not believe we are getting the full recognition we deserve for our food, with the exception of specialist areas such as cheese and meat. We could work to promote a far wider range of produce throughout the world.

Ten or 12 years have passed since the Acting Chairman, Deputy Kirk, and I put forward the idea of a joint tourism board for both parts of this small country, which has a small population, and it has taken a great deal of time to get it moving. We should work together in all other areas in which we share common approaches and objectives. I do not see why Irish food and drink cannot be promoted on an all-Ireland basis. The basis of such co-operation exists in the Good Friday agreement and we should have the courage to take it forward.

The interests of producers and consumers have been mentioned by some speakers. This issue is of crucial importance. People have the money to pay extra for certain products. Deputy Ferris mentioned that organically produced food was a feature of the Irish market before it was described or sold in such terms. Many people have the wherewithal to pay and they will pay for a good product. The conflict between the interests of producers and consumers will continue to be a feature of this debate. The interests of both groups should be recognised and catered for as much as possible. There may be conflict in some areas, such as availability and price, but there should be no conflict in the area of quality. We have quality and we should ensure that we maintain it. Indeed, as our American friends would say, we have got it so we should flaunt it. We have a lot going for us.

I would like to discuss many other important issues, such as genetic modification, that were raised by other speakers during this debate. Contrary to what was said earlier — I appreciate the concerns of Members like Deputy Upton — this Bill attempts to give horticulture a chance on the big stage. The outlets, marketing and the big personnel team are in place, and Bord Bia deserves its opportunity within that team. I compliment the Minister on this Bill. Deputy Ferris and others referred to health and safety aspects of Irish produce, which is what we should be marketing. We no longer have difficulties in that regard as the problems that existed were dealt with speedily and competently by the Minister. This Bill is another example of his approach to promoting this business.

The international market has changed. Marketing has changed, as the Minister said, and everything has become internationalised. We have to be efficient, competitive and market-orientated. It is fine for Deputy Boyle and others to speak about selling one's produce down the road and catering for various sectors of the market, but we should also be interested in catering for large markets, multiples and big consumers — that is the world in which we live. We would all like the old village economy to return, like the old days, but that will not happen. We are competing. Those who are trying to produce and sell the material are entitled to our strong support and full promotion throughout the world. The Minister has spoken about establishing complementary international branding, which is the answer to many of our problems. I think we should continue to promote the brand we have developed, which is one of high quality Irish food of the old tradition. I commend the Minister on this Bill and I hope everybody, particularly those with a genuine interest in and concern for the agrifood sector, will row in behind him on this issue.

Mr. Hayes

I am glad of the opportunity to speak on this important Bill that will see the amalgamation of Bord Glas and Bord Bia. It is important that we give time to discuss our major industry beyond the farm gate. The Minister's speech was short but to the point. The Second Stage of this Bill gives all Members an opportunity to expand their views on the agrifood industry that is so important to the country. This is at a time when the EU will expand with the admission of the ten accession states. With this, there will be new pressures on the Irish agrifood industry and the whole economy. Agriculture and food is still our major industry and has gone through turbulent and changing times. It needs to be debated.

The question still has not been answered in this debate as to why this Bill is needed. What is the compelling reason to amalgamate these two agencies? I am concerned about combining bodies such as these when there are other opportunities and challenges for us in this area. Take the example of how beef is marketed in Ireland. I hear the Green Party, in particular, speak about organic beef and food. I am in favour of the organic foods sector developing and expanding. However, beef produced in Ireland is closer and more practical to organic standards than that produced anywhere else. Acres of newsprint have been written against the Irish beef industry and the advertisements made during the BSE crisis did not make our industry proud.

In this debate, we should be more focused in promoting the beef industry that has got a hammering in the past. Certainly cowboys were involved, but they were a minority. There are cowboys involved in every industry, including the odd one in politics. However, those cowboys gave the beef industry a bad name. Many producers have gone to huge expense and effort to produce top quality beef. In the Tipperary South constituency, this is exemplified by two efficient beef processing plants that produce some of the best beef in the world. Beef from there is closer to organic standards because of the home-grown grain and grass from some of the safest and healthiest countryside used in cattle rearing. This standard was lost in the past and it has never been properly marketed. No matter where one goes in the world, even in some European countries, it is obvious that good quality Irish beef has not been promoted as well as it could be.

Much work has been done to improve presentation and traceability. It is wonderful that, in supermarket displays, one can see from what farm the beef has come and the pride of the individual producers in their product. The odd time when I do go to the supermarket, I always check for the producer's details. It is great to be able to check the name and address of the producer and the herd number. People should be conscious that this is happening instead of being too critical of farmers, meat factories and the meat processing industry. We have beaten ourselves to death in this regard. Are we sure of the traceability of Argentine beef imports? I question it because the traceability of our beef products is much better.

Where did the idea for the amalgamation of Bord Glas and Bord Bia come from? Who was pressing for it? Is it a money saving exercise promoted by the three wise men who were looking at tightening the budget? Political influence is another area of concern when setting up any State board. I hope that the persons appointed to this new board will be genuinely interested in the production and promotion of food. Only an hour ago, I received a telephone call from a person involved in well-known State board saying that its chief executive's position was threatened because of political interference. Although I have not checked the full details, it seems there was a meeting in recent days and, due to political interference, the chief executive may resign. The food industry has significant money-making potential for some, such as the co-operatives and the Larry Goodmans, and there is much at stake. We, therefore, need clarification on this matter. Every week accusations are made in this House about political interference. The best people, genuinely interested in promoting the food industry, need to be appointed when establishing this board.

There are concerns in the potato industry about this amalgamation. Those who have invested heavily in the industry are concerned that their products are not being marketed as well as they could. There is huge potential in this industry. We need to help producers and promote their business from an Irish point of view. We will come under increased pressure from the ten new member states so we must develop the potato industry and the mushroom industry.

In my constituency, Tipperary Co-operative Creamery with Monaghan Mushrooms have filled a void by creating good employment and opportunities in an area where agriculture has changed. The Minister's good offices helped the mushroom industry in Tipperary but now the industry is under pressure and many of those who invested in the business and borrowed from the banks have closed their units. It is sad to see the units lying idle or in some cases being taken over by co-operatives. One of the banks that provided finance for the industry has been reasonably kind to these people but something must be done to help those in the mushroom industry who are in difficulty. It is a short-term difficulty in a labour-intensive industry. The Minister should look at that in the coming months. Agriculture will change with the advent of the Fischler proposals. There is an opportunity for us to cultivate home-grown vegetables and people could expand their business into that area if they received training and support. We import a large quantity of vegetables but we should be trying to grow more of them. Although the Fischler proposals will change agriculture, we need to continue to employ people in rural areas.

Earlier this week we discussed the nitrates directive. A lobby group of farming organisations met us but I wonder why they lobby the Opposition Members because there is a limit to what we can do. They should be lobbying the Minister who is smiling at me now because as he said some of those people signed up to the agreement. However, more attention should be given to agreements. On a broader scale, the nitrates directive will have a significant impact on commercial farmers who are extremely worried about it because they work full-time in agriculture, have the largest bank loans, create employment, and give work to the co-operative industry. They are essential to the organisations that operate beyond the farm gate. Co-operatives such as Dairygold, Kerry Foods and Glanbia will depend on them. The Minister must fight hard for a derogation for these people. We have been slow and easy in fighting this but it has gone too far. The farming organisations signed up to it but they have made a mistake which needs to be reversed. I urge the Minister not to leave any stone unturned on this. There may be people in the Department of the Environment, Heritage and Local Government who have different ideas but our national industry must be given priority. This nitrates directive will have a serious effect and must be addressed.

I wonder about the cutbacks to Teagasc around the country. Closing down local offices that have been of such benefit to small producers should be reconsidered. Cutting back on the Teagasc budget is not helpful. Whatever people may think of Teagasc, it is involved in education and that is essential if our industry is to grow and develop. If the Minister is saving money by this amalgamation he should put that money back into marketing, training and education in the industry. Teagasc is the only agency that can teach people how to produce mushrooms, potatoes and other vegetables, the production of which is important to our economy.

This issue also touches the health of the nation. I am amazed at the effort dedicated to selling fast foods that are bad for us. Obesity is a major problem around the world yet at every ten yards one sees an advertisement for burger outlets. Next month the Government will introduce a ban on smoking in the workplace — although Deputy Walsh was not happy about that. There should also be some kind of restraint or tax on advertising for food that is harmful. I urge some restriction in the future on those foods which contribute to obesity because that is a serious problem for families and for our society.

Can the Minister tell me the real reason for this proposed merger? Is it to save some money or is it in the interest of agriculture? This debate is positive and it is important to cover every aspect of the issue because food and agriculture are connected and we have benefited greatly from a vibrant agricultural sector. We should be proud of our food industry. Many of our co-ops have made a significant international impact and there is great opportunity to develop further but we must meet more challenges too. I defy any other European country to say their air or water is cleaner than ours or their grass is as good as ours. We have the best and we should be prouder of our industry.

Mr. Eoin Ryan

I wish to share my time with Deputies Wilkinson and Mulcahy.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. Eoin Ryan

I welcome the Bill and congratulate the Minister on bringing it before the House. The primary purpose of this legislation is to amalgamate Bord Glas and Bord Bia. Bord Bia was established in 1994 after the amalgamation of CBF and ABT and has the statutory function of promoting Irish food and drink at home and abroad. Bord Glas, the horticultural development board, was set up under the Bord Glas Act 1990 to improve all aspects of horticulture.

Ministers are often accused of not consulting when they introduce legislation or make changes. In this case, however, the Minister consulted 34 organisations. The main concern expressed was that there should be a dedicated horticultural subsidiary board of this new body. The Minister has done that. I welcome the fact that horticulture will be given a proper role in this new body.

Members of the Opposition asked why this Bill was necessary. Bord Bia has 55 staff, while Bord Glas has nine staff and a board of 12. That does not stand up to scrutiny. Under this new body, Bord Glas will be able to benefit from all the expertise in Bord Bia and will be able to use the logo, existing quality schemes and offices Bord Bia has abroad. One of the success stories of horticulture has been the mushrooms we export. I hope we will be able, through our offices abroad, to get new markets for our mushrooms which are of high quality. This Bill offers the horticultural industry an opportunity to avail of many new services and the expertise which has benefited Bord Bia.

I agree with Deputy Hayes about the quality of our meat. Irish lamb and beef are as good as the best produced anywhere in the world. The way lambs are reared means the meat is organic and the beef is almost the same. We have two great products which are doing extremely well. There have been difficulties over the years, but they are doing extremely well because of their high quality. We should recognise that. I have no doubt the same can be done in the horticultural area.

There are challenges ahead. Ten new countries will soon join the European Union, which will create further difficulties in the horticultural area. I spoke to growers in north County Dublin recently who told me that tomatoes are being imported for €4 a box. It is impossible for anyone to compete with that. Products in France are sourced locally and that has been successful. We must ensure that our retailers source their food and vegetables locally when they are in season. Small and large towns in France also have markets where farmers sell their goods. I am glad that is becoming more fashionable here because it will help to develop our horticultural industry.

People want quality. They want to know that the fruit and vegetables have been taken from the farm that morning or the day before. They want to know they are fresh and wholesome. There has been an increase in the amount of fruit and vegetables eaten in this country. People are becoming more health conscious and eating healthier diets. I hope that continues. There is a great opportunity for the horticultural industry to develop as a result. However, products must be sourced locally because we will not be able to compete against some of these new countries which produce vegetables in larger markets and sell them throughout the European Union. If we have good quality food and vegetables which are sourced locally, the horticultural industry will be able to develop and expand.

The amount of packaging on food and vegetables in supermarkets drives me mad and I hope the new body will examine this. The Department of the Environment, Heritage and Local Government is trying to get us to reduce the amount of packaging we use, yet everything in supermarkets is in some type of package such as a plastic tray with cellophane wrapping or cling film. It is almost impossible to touch the fruit and vegetables in the supermarkets. They are all pre-packed. It is an environmental disaster. The new body should try to minimise the amount of packaging we use. People want to know that the products are fresh and that they have just been taken from the farm.

I wish the new board well. It will face many challenges, but the existing expertise and success of Bord Bia in exporting beef, lamb and other products means the horticultural industry has a good chance of developing and succeeding in this country and in export markets.

Mr. Wilkinson

I thank the Leas-Cheann Comhairle for giving me the opportunity to speak on this Bill. The primary purpose of the Bill is to provide for the amalgamation of Bord Bia and Bord Glas. Many changes have occurred over the years in the production and sale of food products. Our meat industry, especially beef and lamb, has enjoyed great success throughout the world. Part of that great success is due to our efforts.

I compliment the Minister on moving quickly when disease threatens. We are conscious of that. I thank him for moving quickly when the poultry industry was threatened with disease. It means a great deal to many areas. I refer to Cappoquin in west Waterford where the production of chickens is seen as an alternative enterprise. Many smaller farmers became involved over the past 20 years. Farm production, factory sales and diversification added value to the industry and meant that there was full employment in the area during the difficult years of the late 1970s and 1980s.

The agri-food industry continues to play a pivotal role in the economy. The food industry has undergone considerable modernisation to meet the demands of consumers at home and abroad. It is now fitting for us to look at the two bodies involved to see how we can progress them. It is important to move with the times and great challenges are facing agriculture, with CAP reform, decoupling and all the other changes. Not everyone feels all these are good. Before these changes were mooted, farming was changing anyway. Many of our young people were getting further education and may have seen easier ways of living. However it is important that the best price and the best production and sales methods are employed to promote our food sales across the world.

Given its low import content, the sector accounts for 25% of our net export earnings. Our markets are balanced between the United Kingdom — once our only significant market — at 40%, the eurozone at 30% and the third country markets beyond the EU also at 30%. I am confident that the outlook for the entire food industry is positive as well as challenging.

The value of horticulture in 2003 was €40 million. This is ranked third after beef and milk, which is difficult to believe. Another diverse and well-developed sector comprises two main areas: the production of amenity products such as trees, shrubs and flowers; and the food sector, which produces a range of edible fruit and vegetable products. Sales of plants, flowers etc. at garden centres increased by 9% last year. Some €59 million was spent on outdoor plants, €6 million on indoor plants and an amazing €4 million on cut flowers. This shows the great outlook that exists for agriculture and horticulture production.

The amalgamation of both bodies is timely. Significant work is to be done. These are challenging times with greater consumer numbers. The Minister is correct in his approach, on which I compliment him, and I support the Bill.

Mr. Mulcahy

I also welcome the Bill and congratulate the Minister on introducing it. All the functions of Bord Glas can properly be subsumed into Bord Bia. It is desirable for a single authority to have a central focus for the development of food and agricultural products. I believe Deputy Hayes said Ireland has an enviable reputation for the quality of its agricultural produce. It is literally famous throughout the world for its beef, lamb and dairy products. We can be very proud of our food products.

There are two important sections in this Bill, section 11, which defines agricultural products, and section 12, which enunciates the functions of the board. There is no mention of the dreaded GM in the Bill. The people do not want to consume genetically modified food and do not want it in the food chain and this should be made clear in the Bill. Perhaps this could be considered on Committee Stage.

A few years ago this House debated two European regulations on that topic. At a meeting in Brussels on 8 December 2003, I learnt with some concern that Ireland had voted in favour of allowing the introduction into the European market of genetically modified sweetcorn, known at Bt11. As it happened this was a draft Commission proposal that was not passed at that stage. As Ireland now holds the Presidency it will fall to us to determine whether Bt11 should be allowed in. We should refuse to do so. We do not have sufficient scientific research to show whether genetically modified food could corrupt the food chain. I make no apologies if I am treading on corns on this matter as I hold strong beliefs.

I raised this topic at the EU scrutiny committee, as the vote in Europe had not been scrutinised by either House of the Oireachtas. A major report will return to the committee on this topic. The motion passed stated: "that a report be presented to this committee with regard to European legislation concerning genetically modified or novel foods, the extent to which, if any, such legislation has been debated or scrutinised by Dáil Éireann or any of its committees, all relevant decisions in this area taken by the European Standing Committee for the Food Chain and Animal Health, including all votes by Irish representatives."

Section 11, which defines agricultural products, should exclude genetically modified food. We should state that we will not support the production of genetically modified food products in this country. Section 12 should outline a function of the board to ensure the integrity of Irish food and to ensure that foreign and unproven technologies will not be allowed into our food chain. There has been considerable discussion about identifying food products with a GM label. I have never seen any food products with a big warning label stating, "this food is GM". Given the amount of food we import, unbeknown to us traces of GM food may have already crept into our food system. The people do not want Irish farmers producing genetically modified food. I am confident that the Irish consumer does not want to consume genetically modified food.

While congratulating the Minister on introducing the Bill, it affords us ample opportunity to give a statutory expression to our rejection of the whole concept of genetically modified food. Nobody will convince me that putting fish protein into tomatoes will be good. I certainly do not want to eat it and I do not want to legislate so that other people have to eat it. I am not convinced the consumers will have adequate protection or information. Europe should not give in to bullying from the large corporations in the United States of America, which want to impose their will across Europe for their economic purposes. I am against that and I ask the Minister to listen to my plea. I am speaking for many people in this regard. Otherwise, the Bill is an excellent one, which will give added focus to the Irish food industry. I commend the Bill to the House.

Mr. Crawford

I welcome the opportunity to speak on the Bill and also on the issue of agriculture, because we seldom get such an opportunity. I congratulate the Minister, Deputy Walsh — these are the only congratulations he will be getting from me — on appointing my former colleague, Alan Dukes, as chairman of the committee considering the future of agriculture. It shows that the Minister can sometimes recognise a man of significant ability and knowledge of the agriculture sector. As someone who sat on a similar think-tank in the past, I am not too optimistic about what it is likely to do for young farmers on the ground, but I wish it well.

Many Fianna Fáil backbenchers have spoken about the high quality of Irish industry. There is no doubt that we have some of the best producers at every level. Only this week we witnessed the success in Brussels of the Irish Holstein breeders, who won as many prizes as possible, including that of overall show champion. This proves we are among the best in the industry and have some of the best and most efficient producers. Otherwise we could not have competed.

The Minister mentioned in his speech that the food industry has changed and become more international over the last ten years. I can remember a time when we were not even in the EEC, yet we were exporting to America and many other places. The food industry has been on top of things through the years, using every possible avenue to promote and sell its products. In those days there was no intervention scheme. The meat factory in Leixlip, which was owned by farmers at that time, produced high-quality products to be sold at a premium price in British supermarkets. They used every part of the animal, even producing corned beef. I wonder whether corned beef is produced here today. Perhaps it is all being imported from Argentina. We must not forget that we inherited a good industry many years ago and maximised the jobs available in the slaughter industry as well as the live industry.

The Minister mentioned that we need to focus on efficiency, competitiveness and market orientation to make the most of sales opportunities, which is something with which I agree. He says his aim is to assist the industry in addressing these challenges, but I question this. We need only consider the Minister's record over the last number of years in increasing the budget for Bord Bia. I must state at this point that I have an interest in the organisation as I was a member of Coras Beostoic agus Feola as a producer representative for seven years. I am also a dairy farmer in my own right. There are challenges we must meet. Will the amalgamation of these two bodies do anything to improve matters? Is it just a cost-cutting exercise or will more money be made available?

It is possible that the Minister did not even know about this — few people other than Deputy Parlon did — but under the decentralisation programme, 75 jobs at Bord Bia are going to Enniscorthy. As one involved with the board, I cannot understand that. I thought quite a few Bord Bia jobs were already in foreign offices. Will we be bringing all these people back just to move them to Enniscorthy so that town is given a boost? What will actually happen? The Minister is talking to his Dublin colleague, who has a great interest in Tallaght. Would it not be more logical to move the organisation to somewhere like Tallaght so it would be nearer the centre of activity? Much Bord Bia activity is in sales and marketing and there are many dealings with people who are entering and leaving the country. Is it practical for the meat industry of this country to be represented by an office in Enniscorthy? I have nothing against decentralisation — I welcome it — but some elements of it are hard to understand.

The Minister referred to the transfer of functions, but since my own group does not agree with this idea, I will not go into detail. However, some interesting comments were made. Since there was not much to the Minister's speech, I will not be standing here too long. It was stated that any regulation proposed in the matter of levies on live exports would be laid before the Houses in the normal way. This is a return to the issue of the Minister signing regulations without any discussion in the House, good, bad or indifferent. Many of these regulations were issued during the foot and mouth disease crisis, and the Minister agreed he would be back in the House in 12 months to discuss them. They have never been discussed since, yet they continue to be in effect. I raise this issue purely for the sake of it as I know the Minister will not even listen. He will do his own thing but the manner in which these levies were lifted was not very fair. I welcome the idea of change but that is something, along with the whole question of the live industry, that should be discussed in the House in a proper way.

The Minister also mentioned subsidiary companies. I do not fully understand what this is all about. Does it mean he will be setting up companies to deal in meat or vegetables? One person did attempt this years ago, during my time in the IFA and CBF. At that time, when we were dealing with many European structures, there was an opportunity to do this. Perhaps in the Minister's reply he could go into this further.

I will consider a few aspects of the industry and its future. The mushroom industry has been represented by Bord Glas. Earlier speakers said that the amalgamation of the two boards would open up new markets in this area and that the expertise of Bord Bia would add to Bord Glas. There is certainly a long way to go and much work to do. There has been a drop of €11 million in mushroom exports in the last 12 months. There were roughly 1,000 growers up to a couple of years ago, but there are now around 300 and the numbers are still dropping. There is no doubt the mushroom industry is under severe pressure. Can the Minister give me a guarantee that every effort has been made to ensure that no mushroom carrying an Irish label has been produced anywhere else? I have reason to believe that mushrooms from Poland and other areas may be selling as Irish mushrooms in some of the markets we have built up over the years. Along with producers, farmers in my constituency of Cavan-Monaghan worked hard to build up that industry.

As one of the previous speakers said, he had not realised how important agriculture is to the nation. The main product in this country's vegetable exports is mushrooms, and two thirds of those are produced in County Monaghan. It is strange that, while Ireland's production numbers have decreased, the 200 growers in Northern Ireland have remained in business. Major questions must be asked about our efficiency and how we run this industry when so many mushroom growers have gone out of business.

Poultry production is also under pressure. Again, production in Northern Ireland is increasing dramatically while production in this country is either static or decreasing. What is the reason for that? Have we made the best efforts to sell our product or has there been less promotion? Recently, as a result of the avian flu problem, the Minister was given great credit for introducing new labelling requirements. However, two years ago, I challenged the Taoiseach in the House on that issue because I, with my colleagues in the Committee on Agriculture and Food, had visited Chicago and had seen that production constraints were not the same there as here. Undoubtedly, they are not the same in Brazil or Thailand either, while our producers must produce to the highest standards. They are not competing on a level playing field.

There is no need to say much about pig farming because there are few farmers in that sector. It has, in effect, died out. There are a number of large producers but few ordinary family farms make a living from it. It is interesting to record, however, that, in the period 1982 to 1986, the average price a farmer received for his pigs was 152 cent per pound. In 2004, he receives from 126 to 132 cent per pound. Farmers cannot sustain that type of loss and continue in business.

I was interested to hear Deputy Eoin Ryan refer to the fact that only eight or nine people work in Bord Glas while there are 12 board members. We will now establish a new board of 12 members within the new Bord Bia structure, so that will not change. It is possible that two of those members will also be on the senior board. I hope the board members will be representative of the producers, processors and those with a thorough knowledge of the industry. These people know what is required and how to achieve it.

Agriculture is at a serious crossroads. The Minister has been in office for a long time and has done much good work, but if he considers what is happening in the industry and talks to anybody involved in it, he will quickly realise the extent of the fear and uncertainty. I am aware of one person involved in the industry who has brought together groups of roughly 20 farmers to discuss their future and to find out, from the industry's point of view, what direction they will take. He told me that every meeting is the same. The farmers tell their stories and it is clear that they do not know where they are going. There is the issue of decoupling. Those in the dairying sector wonder if they should sell their quota now or continue in business.

Bord Bia cannot ignore the dairying sector because it produces most of the product in the meat sector from culled cows and calves. One of the Minister's colleagues presented a cup in Virginia last year to the top dairy farmer in this country. The farmer has approximately 140 cows but he says he is getting out of dairying because there is no future in it for him or his family. That is frightening. It is partly because of where he lives and partly because of the situation created by the nitrates directive, slurry accommodation and the uncertainty that has been created. The Minister has agreed there is €1.41 for this year's dairy quota but he has given no indication of what it will be next year. That creates uncertainty. If we allow people of that calibre to leave the industry, what future does it have? Will this be the Minister's legacy or will he clearly state what support he will provide to allow these farmers to provide the 24 week slurry accommodation that is required?

It is 24 weeks in County Monaghan. Half of the parish of Killanny is in Louth and half is in Monaghan. A farmer told me the other day that he is delighted to be living in County Louth even though half his farm is in Monaghan because he will get away with 16 weeks. Across the river, it is 24 weeks. Is there any scientific basis for that? The third rural environment protection scheme is under threat. It was to be introduced on 1 January but that has not happened. The Teagasc budget has also been cut.

The Minister told the House that farmers need to think wisely and market their products properly. Last year, however, he allowed the budgets for Teagasc, the advisory body that is needed more than ever to advise farmers for the future, and Bord Bia, the promotional body for their produce, to be cut. At the same time, the Minister allowed the grant aid to help farmers restructure their farms to deal with these changes to drop dramatically.

Every day Members of the House are told what was spent in 1997, when the current parties in Government came into office, in the various Departments and how much is being spent this year. I wish to put on record some figures given to me by the Minister. In 1997, €94 million in grant aid was made available to farmers for farmyard pollution control, dairy hygiene and so forth. Last year, it was €24.9 million at a time when farmers never needed it more. Housing prices have at least doubled in that period but only one third of the grant given in 1997 is available seven years later. This shows how farmers are being supported.

Bord Bia deals with beef products as well as poultry and other produce. The beef industry is most important to this country. Decoupling has been introduced and moneys are now paid directly to farmers. There will be little support through intervention. Hopefully, export refunds will support exports to Russia and other markets. What markets has this Minister opened for producers? I clearly remember sitting on the Government benches behind the then Minister, the former Deputy Ivan Yates. The industry was in a crisis as a result of BSE. The Taoiseach, the Minister for Agriculture and Food and other Ministers who were then on the Opposition benches told us it was only a matter of getting on an airplane to sort out the beef industry. They promised they could open the Egyptian, Libyan and other markets.

There have been difficulties with BSE and so forth but the only reason Irish producers have received reasonable prices for their cattle is that the outbreak of foot and mouth disease in the UK led to a change in regulations and opened new markets to them. The figures make that clear. Are we selling any significant amount of beef to markets outside Europe, aside from the low price beef exports to Russia? We are not. If this new structure is to work, it must be properly financed. The Minister must work at Cabinet to ensure we get a proper budget for Bord Bia so that it can, with the new available market structure, ensure our beef is sold as a premium product at a premium price.

Another issue, which I hope to have the chance to discuss some other day, is the issue of disease. Two years ago a farmer's stock was bought out as a result of BSE. The farmer was told exactly what to buy in replacement by Department officials. He has now ended up with Johne's disease on his farm, for which he gets no compensation. I beg the Minister to change the regulations with regard to BSE. I ask him not to take out the clean quality animals or force the farmers to replace them with animals with they know not what disease.

Mr. O’Connor

I propose to share my time with Deputy Callanan.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. O’Connor

Listening to the previous speaker reminded me of the challenge I face in dealing with this issue. I have not had the opportunity often to speak on matters relating to this particular brief or this particular Minister.

I suppose I could be sensitive about my inner city background and my rearing in Crumlin, which was a long way from farms and fields. Now I represent Dublin South-West and I am centred in Tallaght. Sometimes people forget there is a farming community in Tallaght. It is not large but it is vibrant above the hills in Bohernabreena. The Minister knows many of the farmers there quite well and has been supportive of them. As an urban based Deputy, I have often pointed out that this Minister has been supportive of my work and efforts to read myself into agricultural issues, issues which Deputy Crawford and other colleagues can rattle on about at ease. I am quite happy to put my hands up in that regard.

I will paraphrase Deputy Crawford's comments about the Minister for Agriculture and Food, Deputy Walsh. I think he is a great Minister. Even in urban areas, that is what one hears.

Mr. Crawford

History will judge him on that.

Mr. O’Connor

People are proud of the efforts he has made on behalf of the farming community and the people generally. We should not be afraid to say that. As a Fianna Fáil backbencher I am proud of the work the Minister does and am happy to applaud him.

Mr. Crawford

He got full support during the foot and mouth disease crisis.

Mr. O’Connor

The Minister has done his job. Out on the streets, whether in Monaghan or Tallaght, one will find he is popular. That has been my experience.

I note that the primary purpose of the legislation is, as others have said, to amalgamate Bord Bia and Bord Glas. Bord Bia was established in 1994 and it has had the statutory function of promoting Irish food and drink at home and abroad. Bord Glas was set up in 1990 to improve all aspects of horticulture. Both agencies were the subject of a special review in 1998. At that time it was decided that Bord Glas should be retained as a special agency for the time being but that amalgamation with Bord Bia should be reviewed within five years. Now five years later, it is clear times have changed. Given the economic importance of the industries, what the Government is now doing will get widespread support. However, as with any legislation or proposal there will be lots of dotting the i's and crossing the t's.

In various contributions I have made on different Bills over my time in the Dáil I have never been afraid to debate the issues and to be constructively critical or, as some might say, helpful. If we read through this legislation or look at the websites of both organisations, we get all sorts of ideas on the issue. I have never been afraid to make it clear I support Government policy while at the same time I attempt to dot the i's and cross the t's. Sometimes — I am sure Deputy Perry will not do it — we get a little reaction from Deputies on the other side of the House who do not really understand the role of Fianna Fáil backbenchers or the democratic process of our large party. We all participate in this manner and ours is a good process.

This Bill is driven by cost considerations. Looking at the two boards from outside, there is clearly some duplication and an overlap of functions. It is a sensible course to remove the duplication by merging the two bodies. However, other considerations should be borne in mind. People who argue for mergers sometimes forget that business entities have a culture inescapably tied up with their individual identity. A successful identity develops into a team with a driving motivation and collective loyalty of its own. In my little bit of research on this subject I see that both Bord Bia and Bord Glas have an energy and enthusiasm centred and focused on what they are trying to do. I believe, however, that Bord Glas faces a challenge to maintain that focus as part of the larger Bord Bia. I hope Senator Quinn will not mind if I quote from his contribution during the Seanad debate. He stated:

The main reason some mergers are not successful is that they destroy the essential energy in an organisation. The promised benefits and the expected financial savings do not always result either. We must tread carefully in order to retain the energy, enthusiasm and culture we have seen previously in small organisations.

I said earlier that I have great confidence in this Minister. Therefore, I am quite confident he will take that on board.

I wish to record my admiration for the achievements of Bord Bia over the years. From my understanding of what it has been doing I cannot but be impressed, as many people are, by its achievements. Agriculture and food are central to Ireland's economy, accounting for 9.2% of GDP, 8.5% of total exports and the employment of 10% of the labour force. The industry incorporates 144,000 family-run farms and 700 companies employing almost 47,000 people. In 2001, the Irish food and drink industry was valued at €16 billion, of which almost €7 billion was exported to over 130 countries worldwide. In excess of 70% of Irish food and drink exports go to markets within Europe.

Meat and dairy products account for 50% of Irish food and drink exports. More than 80% of Irish dairy production is exported. Irish dairy products are available on all five continents and account for €1.7 billion of Irish food exports. Irish branded butter is the leading branded butter on sale in Germany. Meat accounts for 26% of all Irish food and drink exports. Ireland is the largest net exporter of beef in the northern hemisphere with 90% of Irish beef output exported to some 60 countries worldwide. Two thirds of Irish lamb production is exported, mostly within the EU, with almost 80% destined for the premium French market. More than half of Irish pig meat production is exported to the EU, the US and Japan.

Prepared consumer foods alone now account for 26% of total Irish food and drink exports, valued at almost €2 billion. Now there is an area for further development by the board on a five year programme. Ireland possesses the fastest and longest ready meals production lines in Europe and is one of Europe's leading suppliers of branded pizzas. It is now Europe's leading supplier of pizza cheese. Three of the world's leading infant formulae companies have chosen Ireland as their European manufacturing base. Irish companies are among the world's leading players in food ingredients technology.

Ireland is also home to some of the world's favourite drink brands, supplying more than 90% of the world's cream liqueur market. Drinks account for 13% of all Irish food and drink exports. This country boasts the world's oldest licensed distillery and the most successful drinks product launched worldwide in the past 30 years. All this information is on the Bord Bia website. Congratulations are due to all involved.

Let us look at the development of agribusiness over the past three decades. We lost the local co-ops when the major mergers took place. The PLCs then arrived, profit driven with little commitment to local socio-economic needs in rural areas. Recent downsizing and mergers with the resultant job losses are a classic example of this. While the overall benefit to the nation of this consolidation and growth is not in doubt, the cost in rural development should be cause to reconsider. It is necessary to develop a parallel strategy that encompasses what was great about local agri-activity and the successful agribusinesses which contributed to the great achievements to which I referred earlier.

In the development plan of Bord Glas, its key horticultural targets for the period 2000 to 2006 were to increase domestic output by €62 million, maintain and increase domestic market share for horticultural produce and increase amenity exports by €10 million. It was estimated that the overall farm gate output of horticultural products would achieve a value in the region of €393 million by 2006. In order to achieve these national targets, projected ongoing capital investments of €127 million will be required in the industry.

It is important that we support the Minister in every way. At the same time we are entitled to raise questions, and Government backbenchers are no different in this regard. Having said that I have great confidence in the Minister, Deputy Walsh, and we can rest assured that the legislation is in safe hands. What the Bill endeavours to achieve is both well-intentioned and worthy although the issue of its necessity will be the subject of debate for some time. The Government has made a decision and I am happy to support it.

I look forward to the development of the horticultural industry under the new Bord Bia banner. It should be brought to its full potential in the coming years. I hope we will have other opportunities in future to support the Government in what is being achieved in this regard. I am happy to concede the remainder of my time slot to my colleague, Deputy Callanan.

Mr. Callanan

The primary purpose of the legislation is to amalgamate Bord Bia and Bord Glas.

This is important for both the agriculture and horticulture industries. The food and drink industry is one of the few truly indigenous industries and a key driver of the economy in recent years. It is, perhaps, the only indigenous manufacturing sector that has managed to create sufficient scale and expertise to compete on the world stage.

Some 680 companies operate in this sector. The total number of employees in 2001 was over 50,000, which is equivalent to almost 20% of total manufacturing employment in Ireland. As such, it is the single biggest sectoral employer in the Irish manufacturing economy, twice the size of the chemical and pharmaceutical sector. Some 55% of indigenous exports originate from the food and drink sector. The primary agricultural sector employs 114,000 people, giving total employment of almost 165,000 in the combined agrifood and drink sector. This represents 9.5% of the total number of employees in the country.

In 2002, the agrifood sector accounted for more than 8.4% of gross domestic product. In gross output terms the agrifood sector is valued at €16 billion and exports from the sector totalled €6.7 billion in 2002. Since 2002 the loss of exchange rate competitiveness against the dollar is 41% and almost 16% against sterling. This has made for difficult market conditions for food and drink exporters who sell to over 130 countries worldwide. Irish consumers spent €13.3 billion on food and drink, which is equivalent to 22% of total consumer spending.

Ireland produces the best beef in the world. Exports of meat and livestock increased by 5% in 2003, to reach almost €2 billion. A strong performance in beef and live animal exports offset declines in lamb and pigmeat exports. Further growth is expected in 2004 due to increased penetration of premium EU beef markets assisted by the absence of intervention stock, a decline in EU production and relatively strong consumer demand. We also anticipate reasonably steady prospects for lamb and pigmeat. The European beef market is now in deficit for the first time in 25 years. Irish beef exporters, responding to the improved demand, marketed a record 415,000 tonnes within the internal market in 2003, a volume never previously approached in the history of the industry.

The increased focus on Europe is set to continue. The recovery in demand, following the devastation caused by successive BSE scares, is evident in the fact that consumption in 2004, at 7.75 million tonnes, will exceed the previous consumption peak in 1999. The enlargement of the Union from May is set to offer further opportunities. As health concerns switch to obesity, the role of red meat in a healthy and balanced diet is becoming increasingly recognised.

The recovery in the European beef market over the last two years is remarkable. However, significant challenges remain. The prospective ending of the over 30 month scheme in the UK, possibly in late autumn, could displace 70,000 tonnes of Irish beef exports on an annualised basis. The prospects for the cattle and beef trade as the year progresses are also likely to be affected by any pre-decoupling decisions by producers to reduce cow numbers and to bring forward marketing in advance of the ending of the slaughter premium.

Proposals for EU legislation dealing with the transportation of live animals represent an important issue for the live export trade. The continued recovery in the export of live animals, to 220,000 cattle in 2003, has been an important development for Irish cattle producers. We must ensure that live exports continue. I compliment the Minister for his stand on this issue. Agriculture is in safe hands with the Minister for Agriculture and Food, Deputy Walsh.

The challenge from South American imports continues to grow. In the latest GATT trading year, imports of beef from South America into Europe paying full duty are set to almost double, reaching between 100,000 and 120,000 tonnes. Food safety remains at the top of the international food agenda. BSE in the US and avian influenza in both the Asian and American continents highlight the global nature of the meat trade. They also highlight the vulnerability of trade flows to animal disease and concerns about infection migrating to humans. The speed of the response of the EU and national authorities to banning imports of poultry from Thailand, once the issue became apparent, is particularly reassuring. The substantial decline in the incidence of BSE here during 2003 to 183 cases, from 329 in 2002, is similarly reassuring. The continued rise in the age profile of cases points to continued reduction and a positive backdrop to national efforts to regain greater international market access.

The full implications of CAP reform will depend on the decisions yet to be taken by many member states with regard to the options available to them under decoupling. It is clear, nonetheless, that the performance of the industry in the marketplace will be the key determinant of the future scale and prosperity of the livestock meat sector.

Bord Bia will this year launch the chef's Irish beef club in three export markets, namely, Britain, France and the Netherlands. It is promoting Irish beef and lamb with more than 30 leading supermarket groups in 3,500 outlets across Britain and the Continent.

It is important that the dairy industry does not simply stick to the traditional way of producing butter. We must produce what the market wants, which is manufactured dairy products. I compliment Bord Bia on the great work it has done in promoting the food industry. When the two bodies are amalgamated, I am sure they will form a stronger single entity to promote both agriculture and horticulture.

Mr. Perry

I wish to share time with Deputy Ring.

Acting Chairman (Mr. Carey)

Is that agreed? Agreed.

Mr. Perry

I listened attentively to Deputies O'Connor and Callanan talking about the potential of the market in Ireland. With so many people working in the market, the level of horticulture imports into the country is disappointing because much of this could be developed within the State.

The Bill proposes that Bord Glas, which is involved in an important area of food development, be merged with the larger Bord Bia. While Bord Bia is doing fine work in its defined niche of the food industry, it hardly makes sense to merge Bord Glas with it. I know this was driven by cost considerations and the duplication of work.

The horticulture industry has made a major impact in the economy. Since its inception ten years ago, Bord Glas has successfully worked for the development of the industry. I agree with the points raised by Deputy Upton. Owing to the potential of the horticulture industry, the role of Bord Glas should have been expanded and greater resources given to it. We are all aware of public health concerns. There is much current debate about obesity, diet and health awareness. The level of spending for public health within the Department of Health and Children is minimal. Through effective advertising on RTE and the national press, there is now greater knowledge of horticulture promotions and I hope this is not lost.

Bord Bia is concerned with the promotion of Irish beef abroad. When one goes to London, it is disappointing to note that Irish beef is not marketed to the same extent as, for example, Scottish beef. It is regrettable that Bord Bia has been unsuccessful in having an "Irish produce" label attached to such products. Perhaps supermarket chains do not want to use them.

The value of the horticulture market to the economy in 2002 was €2.3 billion, of which fresh produce accounted for €1.9 billion. This is a growing market and its success should be commended. The Minister has clearly done a good job within the Department. Coming from a background in retail, I know the importance of promotion. The market has changed considerably; one need only look at the frozen and pre-prepared foods markets. Bord Glas has played an important role in predicting future market demands, especially in this time of rapid consumer change.

In its recent report, Bord Glas highlighted the tremendous changes that face the horticulture industry. More Irish families now eat out and there is increasing competition for food staples such as potatoes and vegetables from non-traditional foods such rice and pasta. The demand for pre-prepared organic produce has increased due to the growing health concerns in the sector. It is important that the Minister closely supervises the activities of Bord Bia's marketing within the home market. I have seen some of Bord Bia's effective food promotions. The horticulture board has also done this. We must build awareness with the home consumer. It is important that the board the Minister appoints is tuned into concepts of retailing. It is important that the board be focused on every niche market and it should seek to promote produce in every small town and village. It should also promote the advantages of healthy diets in schools. These changes present an unprecedented challenge to the horticulture sector. Producers and wholesalers will need advice on how to cope with these changes. So far, the sector has risen to the challenge presented by new market demands.

Decoupling will soon be introduced. With the amount of land that will now be available to alternative enterprises, it is important that the Department gives every encouragement to people to set up such enterprises. With the dependence on REPS cheques, farming is becoming a therapeutic pastime for many people. Nonetheless, it is important to encourage enterprise. The new body should adopt consumer-driven and market-led policies.

The sales of pre-prepared and chilled horticulture products increased by 20% in 2002. Bord Glas should be given a good share of the credit for this. It has done all it could to provide the necessary back-up and support to the horticultural sector. This system of support should continue in future. This will be impinged upon with the absorption of Bord Glas into Bord Bia. Perhaps the Minister will outline how he will empower the new body and what resources it will have. What will be its focus? Will it be driven through a home market or an external market? What supports will be given to support new entrants to the market? In light of the country's massive land bank, it is important that encouragement be given to generic, home market businesses.

I had the occasion of going to the Dublin market yesterday. I saw containers of produce coming to it from all over Europe. It is a huge loss to our economy.

Mr. Durkan

It is because of bad marketing techniques by the Department.

Mr. Perry

The consumer is often driven by French or Dutch products. It is important that we can say our product is equally good and that we can compete in that market. Home marketing can often make that case. With Bord Bia, the level of promotion we have seen recently on RTE has been quite effective. That should very much be encouraged, as the level of convenience food is now such that people want washed lettuce and diced tomatoes. That is how far they are going. The issue is the value added to the product the customer now demands. People are quite prepared to pay for that too, so there is a huge market for added value products, which also creates a significant number of jobs.

Bord Glas has also worked closely and co-ordinated its work programmes with other State organisations, most notably with Teagasc. I know Teagasc has been very effective in its support to farmers, whom it has encouraged. It is important in that tie-up that the Minister incorporate Teagasc into the marketability of the re-launch of this agency. It is important that he provide a new focus. We will see massive changes to Teagasc too, and it is critically important that all the sectors from the whole agricultural family be involved on the board. Those close relationships have resulted in important regulations and standards in the horticultural industry, as well as the enactment of a policy to inform and direct State investment in horticulture. That critical investment is also very important.

I am a great believer in small enterprises. Not all the jobs that we have seen are the 365 State jobs. People must be given that enterprise culture, and in the enlarged European Union we should not only be seen as a population base confined to north Dublin, which is very much a growers' centre. We should be encouraging potato growers and vegetable growers across the country where they have a good product. We have seen that very clearly with the mushroom industry, which has also been very competitive.

We have been informed that no significant financial implications arise from this Bill. That said, it is hard to believe that the budget has allowed for cutbacks in spending on key support services in the horticulture industry such as Teagasc, a very important area. We have seen cutbacks; we had the Teagasc board before the Committee of Public Accounts. We also had the closure in Leitrim. We met the Secretary General of the Department. There were obviously cutbacks there, and in many ways Teagasc may not have moved with the times regarding the level of services provided, and not just to farming communities. However, one should spread one's net more widely than simply to farmers, namely those who have extra time on their hands. Farming is very much a part-time occupation in the west of Ireland. Clearly, I am a great supporter of the level of encouragement by Teagasc. The 2003 budget cut its funding by €15 million, and in 2004, the sum will be €5 million. Those are considerable cuts in Teagasc's budget, and they will clearly have an impact. The farming community is becoming concerned at new challenges facing the agricultural sector. It has professed fear for its livelihood, and many fear they may have to get out of the industry. Farming is very much a therapeutic pursuit.

By merging one of their support outfits into a larger body, the Government is ignoring its concerns and reducing services. That is clearly an issue. When one sees Enterprise Ireland and other critical services promoting home industry and creating jobs, one sees it is a marketing tool for the industry — Bord Bia and Bord Glas — in a very critical area of growth. It has huge potential for horticulture as an alternative farming enterprise. It is in many ways regrettable that it is not receiving further promotion. I hope that it does not get totally lost inside Bord Bia as that board is mainly driven by marketing. The horticultural body was very much active in production supports, the focus of which is distinctly different. While Bord Bia was not effectively involved in the production line, Bord Glas was involved in the horticultural sector from the bottom up. I hope the sector in question will not be lost.

This Bill does not guarantee that the sector to which Bord Glas provides support and services will continue to receive the current level of attention. If and when the amalgamation occurs, the Bill provides for a proposal to appoint a subsidiary board, which is to be welcomed. I would like to know the Minister's plans for that other board and whether it will be focused on horticultural interests specifically or be an amalgamation of the two areas. One hopes it will have a balanced membership to represent the industry in its entirety. That is very important, and if the funding and staffing levels are to remain the same, it is hard to see the logic of the integration. Bord Glas has provided the horticultural sector with an invaluable service, and it would be a shame to see it dissolved into a larger body, where it may lose some of its ability to continue this service.

From a retailing point of view, growth in the sale of fruit and vegetables is a key aspect. Some of the larger supermarkets in the country, which I will not name here, import a considerable proportion of their produce from abroad ready for sale.

Mr. Durkan

Shameful.

Mr. Perry

That is in many ways regrettable. We are talking about the creation of jobs. We have mentioned the 165,000 people involved in the food sector. There is currently very little in the way of Government aid or grants available to set up a small company in Ireland. Unfortunately, that work is now left to the enterprise boards in each county, and we know how little funding they get. Their task is to give support to small companies with between one and ten employees. The service sector in this country receives little or no support.

Given that level of support to small industry, the loss of any marketing tool to small companies is a blow. To date, small industry has received very little from the State. Large oaks grow from small acorns; it is all done by sheer determination, hard work and grit. People talk about a 40-hour week, but most people in the private sector work a 40-hour weekend. For anyone setting up a horticulture enterprise, and particularly in the mushroom business, the level of hard work from the owner or manager is very high. Nothing beats the eye of the boss in any business. It demands, especially in a small company, that the proprietors remain on hand to supervise the management structure.

It is in many ways regrettable that any facility for State support such as Bord Glas or Bord Bia should go. They should be there to help people. However, we find in many cases that enterprise boards also stand back. They expect all the risk to be taken by the developer. Unfortunately, they do not get involved, sitting down with the developer and clearly indicating how best they might promote and market that business to make it successful. I hope the marketability and product potential of the horticulture sector will not be lost through this amalgamation. I felt that Bord Bia had an entirely different remit, to do with marketing the food sector. It will be critically important to see the level of cash provision. The briefing note I received indicated that the Bill dealt with the transfer of the current functions of Bord Glas in their entirety to Bord Bia and a comprehensive definition of "horticulture" to include amenity and agriculture.

Debate adjourned.