That Seanad Eireann is of opinion that the price announced by the Government for wheat of the 1957 crop is entirely inadequate and should be substantially increased.
I am glad the Minister is here to deal with this motion. I sincerely hope that if, as last year, he asks any questions, he will have the courtesy to wait until those questions are answered. This motion expresses the disapproval which farmers generally feel towards the level of prices fixed for the wheat crop for the coming year. That feeling of dissatisfaction is well known but, lest there should be any question about it, it might be no harm to quote briefly from a statement issued by the National Farmers' Association during the past week. I am quoting extracts from a letter published in the Carlow Nationalist of 26th January, 1957. The Secretary of the National Farmers' Association writes:—
"Present indications are that many, including farmers, are labouring under the misapprehension that the National Farmers' Association is satisfied with the price fixed for wheat in respect of the 1957 crop. The National Farmers' Association is not satisfied and, as previously indicated, sought a price for wheat based on economic expediency."
With your permission, Sir, I think it would be better to quote the entire letter. He goes on to say:—
"On the basis of calculated costs of production the National Farmers' Association asked for a price of 89/6 per barrel, which was based on the 1954 price plus the increase in cost of production since that date. The Association felt that this incentive would call forth an increase in output of wheat sufficient to obviate the present necessity of spending £5,000,000 on imported wheat, which seriously affects the much quoted balance of payments situation. From this point of view alone, the announced increase, which at most would amount to 2/6 per barrel, is totally inadequate, not forgetting for a moment the rising costs of production. The National Farmers' Association offered the Government a ceiling on the quantity of wheat to be paid for at the full price and the fact that the Government has spurned that offer shows that it realises that the new price is insufficient to call forth the amount we require. We may reiterate that, so far as wheat is concerned, the call for increased production has now been officially abandoned."
There we have a clear statement from a representative and responsible body of farmers indicating that the Government, by their failure to meet the reasonable demands of the organised farmers, have ensured that we will not get the increased production desirable in agriculture. Having regard to the economic condition of the country and to our balance of payments position, it is a very serious responsibility for any Government to retard increased production. Now that we have a representative organisation of farmers, it is unfortunate that the Minister did not endeavour to meet the very reasonable demands of that body. With the farming community organised, I think on sounder lines than ever before, there is machinery at the disposal of any Government to ensure greater output and efficiency in agriculture.
With a Government working in co-operation with the organised farmers, there would be a future for agriculture. But, as this letter has indicated, the Government, in their wisdom or in their folly, have failed to meet the demands of the farmers. If they had met those demands in a reasonable way I am quite sure that the entire farmers' organisation would have gone wholeheartedly on a campaign to increase the area under wheat. However, the Minister has decided he will impose his own policy and is not prepared to accept the advice of the farmers. Neither is he prepared to do as was done in regard to the organised civil servants, nor is he prepared to leave the matter to arbitration. He has chosen to dictate what the price shall be for the coming year.
The Farmers' Association have acknowledged that the price fixed for the coming year represents an increase of 2/6 per barrel on the price fixed for last year's crop. The Minister may or may not dispute that figure. We know that the price this year is on a different system of grading and there is the introduction of a bonus payment in regard to moisture content. The matter has been carefully studied by the Farmers' Association and other wheat growers and the general consensus of opinion is that, while the two systems of payment are not exactly comparable, the net benefit to the wheat grower on the average would be an increase of 2/6 as compared with last year. As the bonus is based on moisture content the price may vary according to the nature of the season. If we get an exceptionally dry season the price paid to the grower may be something more than an increase of 2/6. If, however, we get a wet season the price may be very, very considerably less.
This question was gone into in some detail last week in the Farmers' Journal and the estimate of the price for next year is that, if we get an average harvest, there will be an increase of 3/10; if we get a wet harvest, there will be an increase of 1/3; if we get an exceptionally dry harvest we may get as much as 4/8. On an average therefore, and we know what the average harvest is, we can estimate the increase given as roughly about 2/6 over last year's price.
Now, an increase of 2/6 was given in 1956. In 1955 there was a reduction of 12/6. The cut in the price of wheat in 1955 has been restored to the extent of two-fifths and three-fifths of that reduction is still withheld from the grower. The National Farmers' Association is right in saying that the farmer is entitled not only to the price paid in 1954 but also, in justice, entitled to some increase over the price paid in 1954 having regard to rising costs of production. It must be accepted that the cost of production in agriculture, as in everything else, has increased considerably. In proof of that, we need only compare beet costings, which have been very carefully investigated. When a dispute arose in relation to the increased cost of production of beet this year, as compared with last year, the matter was referred to an independent referee and he decided that the increase in the cost of production per acre amounted to 7/-. If the increase in the cost of producing beet amounted to 7/- we may take it that the increase in the cost of producing wheat is also substantial. It would not be quite as high as it is in the case of beet because, in the first place, the labour content is not as great. Nevertheless, the increase in the cost of production would be substantial.
The National Farmers' Association was, therefore, justified in asking not only for the 1954 price but for something more than that in order to compensate the producer for increased costs. Against all reasonable arguments put up to him the Minister has turned a deaf ear. He has pursued his own policy of yielding as little as possible to the growers. He took 12/6 off the growers in 1954. Two years later he hands back 5/-. That 5/- represents two very grudging concessions spread over two years. At that rate it will take the Minister another three years to restore the cut imposed in 1954, but I am very doubtful if the Minister will be afforded those three years in which to make restitution.
It is unfortunate that a dispute in relation to the price of wheat should again arise as between the Minister and the farmers' associations. We have heard a good deal of boasting recently about the establishment of an Agricultural Consultative Council and various research bodies. Can the Minister say if the Consultative Council has approved of the price he has undertaken to pay for wheat in the coming year? Has the matter been submitted to that body? Has the body, by a majority or unanimously, given its approval to the Minister's decision? I think those are fair questions because, if we are to have a consultative council in relation to agriculture, then that body ought to be permitted to express an opinion on a matter of such importance. If the Agricultural Consultative Council is not permitted to express its views on matters of this kind, if it is muzzled and gagged by the Minister, then it can serve no useful purpose.
Last year the Minister spoke at considerable length on the price he had then fixed for wheat. He claimed that the price at that time was a generous one. One of the arguments he advanced against paying a higher price was that such a price might in some circumstances lead to a surplus. He challenged Senators on this side of the House to tell him what Fianna Fáil would do if confronted with the danger of a surplus of wheat. When the Minister hurled that challenge across the House I assumed he would wait for an answer. Before I had time to reply, he ran—to use his own colourful words— like a scalded cat. He did not wait to hear my reply. He can listen to it now. My reply is that, unless the price of wheat is substantially increased, more substantially increased even than the farmers' associations demand, there will be no danger of a surplus.
The National Farmers' Association have offered to present the Minister with a plan to deal with a surplus, should such a surplus at any time arise. It is idle to talk of a surplus at a time when we are importing £5,000,000 worth of wheat per year. As far as one can foresee the future there is no danger of a surplus, but, if a surplus should arise, there are reasonable and effective measures for dealing with it. Prices, as we know, are an effective way of dealing with this matter. If the acreage of wheat were excessive, the payment of a better price for some other product such as barley would bring about a reduction in the acreage of wheat. Cutting the price savagely and drastically is not the only way to cope with a surplus; it is the least efficient way to cope with a surplus. If there is a surplus in any industry, a savage slashing of prices is not the effective or the efficient way to deal with it.
I believe that the problem could be discussed and could be solved by arrangement between the organised farmers—as they are now organised— and the Minister's Department. The most important thing is to secure a measure of confidence between the Department and the farmers. If we could create in agricultural Ireland the feeling that those who are appointed as spokesmen for a farmers' organisation, those who meet the Minister, will be treated with due regard, that their views will be carefully considered and that a reasonable attempt will be made to meet their requests, we could look forward to a greater measure of prosperity in agriculture, a greater output from the industry, with resultant benefit to every section of the community.
As I have indicated, the Minister spurned the requests put forward by the farmers and suggested his own price. Let me say, in fairness to the Minister and in praise of the farmers' association, that the change in grading, made by the Minister at the request of the farmers, is a step in the right direction. Farmers for some time past have been suggesting that a cut of 2/6 in the price when the wheat falls below a certain bushel weight is too steep and that a cut of 1/- for each pound less in bushel weight is fairer to the growers. It has been frequently suggested that the millers and merchants were against that system, but I do not think that they were so strongly against it. I have met millers and merchants who have expressed the view that the new grading scheme is quite acceptable. It is satisfactory inasmuch as the Minister met the growers in that respect. I always like to give credit where credit is due. If the Minister could have gone a step further and had met the growers in regard to basic price, everybody would be happy and we could look forward to a substantial increase in the acreage.
The Minister may be reaching the end of his ministerial career. One of the outstanding achievements of which he may boast is that he cut the acreage of wheat by 150,000 acres in two years. There was a reduction of 130,000 acres in 1955, which was followed by a reduction of 20,000 acres last year. That represents 150,000 tons of wheat that had to be imported from abroad because the Minister had prevented the farmers from growing it here. That was a tragic occurrence, which will always reflect discredit on the Minister and his period of office.
I do not intend to probe into the question as to why, when he introduced that savage cut, the Minister did not leave the price at least at the level at which he found it when he took office. Surely the Minister must have realised that no Government, no matter how friendly or sympathetic they may be to the farmers or the wheat growers, could have been paying a price that was excessive to the extent of 12/6. The Minister took that course and the only thing we regret is that he has not fully retraced his steps. He has retraced them to a certain degree but has not retraced them fully. He has not restored the money which he unjustly took from the wheat growers.
One of the arguments which the Minister used fairly extensively last year in justification of the reduction in the price of wheat and in justification of the price which he fixed last year was that certain farmers were able to set their land in conacre at high prices. Anyone who knows anything about rural Ireland and about agrarian and agricultural problems knows that the price paid for conacre is not a true reflection of the real value of land or of the crop grown on it. Prices are forced up by competition between the small uneconomic holders, who must take additional land in order to give employment to their families and to provide work for their horses and implements, and the larger contractors who take land in conacre fairly extensively because the prices and the market are guaranteed.