I call on Senator Dardis, who has 12 minutes.
Beef Industry Crisis: Motion.
I move:
That Seanad Éireann calls for urgent and ongoing ministerial intervention to tackle the detrimental impact of the BSE crisis on our beef industry; calls for measures to safeguard employment in the sector; and seeks a concerted campaign to counteract the crisis of confidence among consumers about the safety of beef products.
I welcome the Minister of State. I will grant him some Kerry latitude because I realise they are not as punctual in County Kerry as in Dublin.
I was dealing with a Bill in the Dáil.
I realise that.
It is difficult to be in two places at the one time. Even I cannot do that.
We will proceed with the motion.
The question arises as to which House takes precedence.
I am here; my Bill is still in the Dáil.
I thank the Minister of State for his attendance. On a point of order, will we be able to extend the debate by ten minutes if necessary?
We will provide the full time allocated. The debate will conclude at 8.7 p.m.
Two months ago I said in the House that BSE was the biggest crisis to have confronted the agricultural industry in Ireland since the Economic War and that it must be dealt with effectively and efficiently. At the time it was suggested that I was overreacting. However, nothing has happened since to make me change my mind. I am still convinced that our biggest and most important industry is in crisis and that the livelihood of many thousands of farm families, workers in the meat plants and suppliers to farming is at risk.
The day after the House of Commons statement that precipitated the BSE crisis, Seanad Éireann was treated to a rare gem of ministerial understatement when it was stated: "The latest controversy is expected to cause difficulties for beef consumption in Britain". It was also stated that the House of Commons announcement had "generated a great deal of interest and a certain level of concern". We were told that Bord Bia was "formulating a strategy to counteract any negative impact on Irish beef".
It is clear from these statements that the response of the Department of Agriculture, Food and Forestry was complacent and predicated on the not uncommon attitude that the best approach to any crisis or abuse in the beef industry is to say nothing in the pious belief that the national interest is best served by ignoring reality. The reality now is that total Irish livestock disposals are down by more than 100,000 head on this time last year. Across mainland Europe livestock numbers are building up and beef consumption has fallen by 30 to 40 per cent, with little signs of a recovery. Important third country markets are closed to Irish beef and livestock and 90,000 tonnes of European beef have been taken into intervention. Unless the Government and the EU can come to grips with this crisis and deal with it effectively, we face the real prospect of a total breakdown in our cattle trade when winter fatteners refuse to or, more probably, are unable to buy in cattle next autumn for finishing.
These are the people who have borne the brunt of this catastrophe. They already faced heavy losses even before the BSE crisis. At factory prices down to 90p per lb. at present they have suffered losses of £150 to £200 per head. Even the whole of the EU Commission's £60 million proposed compensation package would scarcely make up their losses. The £8 million "fleximoney" left over after allocations to special beef premiums and suckler premiums is no more than a nod in their direction and, as ever, heifer producers do not appear to exist at all as far as the EU is concerned.
All of the compensation package should go to those who have been most severely hit — the winter fatteners — and the Minister must also secure a permanent increase in the ten month and 22 month suckler premiums.
What will happen when those who were unable to pay off stocking loans and borrowings go back to the banks to restock next autumn? This is a problem which demands the Minister's attention now. The whole beef sector is now riven with uncertainty. Farmers have no idea whether or not there will be an outlet for their animals or what kind of prices they will command. They do not know if they will have a future in the cattle business, to say nothing of production being profitable. The Minister has a responsibility to restore producer confidence as well as consumer confidence. Stability must be restored so that investment decisions can be made.
When the Progressive Democrats were in Government the Oireachtas was recalled during the summer recess to give emergency consent to parts of the Companies Bill so as to ensure that the Goodman controlled plants could avail of examinership. The legislation was introduced by the then Minister for Industry and Commerce, Deputy Desmond O'Malley, who could not be described as a fan of Mr. Goodman, to make sure that adequate slaughtering capacity would be available for the autumn glut of fat cattle. In this much greater emergency similar decisive and effective measures are needed to restore confidence and stability to the entire livestock industry.
In reply to a question in the Dáil last Thursday, 23 May 1996, the Minister said that effective market support measures had been put in place at EU level to overcome what at least he had now come to describe as a "serious crisis". If these measures are so "effective", why is it that factory quotations for fat cattle have been sliding down to the 90p a pound level I have already described compared to the 105p a pound quotes which were being offered at the beginning of the winter?
Now that the renderers have resolved their differences with the meat factories, which own them in many cases, does the Minister expect that the 4p a pound the dispute had allegedly cost will be restored by the factories? What studies have been carried out on alternative safe methods of disposing of offal? Research could do much to help solve some of these problems and to provide the scientific answers to the causes and spread of BSE and to provide reassurance for consumers. The BSE crisis has removed any lingering doubts about the supremacy of the consumer and that the consumer's demands, even if based on nothing more than perception and hearsay, must be met.
To those accustomed to the culture of beef intervention it has taken some time for this reality to sink in, and it is a pity that the lesson has been such a painful one. Unfortunately, our clean green image, of which we boast, and the assured safety of Irish beef count for nothing unless we can convince consumers at home and abroad that Irish beef is safe and good. That is why Bord Bia must be given every support and encouragement to effectively market Irish beef. Has Bord Bia been given the resources required to carry out this essential task? Can the Minister specify the initiatives that have been taken by Bord Bia since the crisis began? The radio advertisements were good; but were they just a case of another short-term response to create an illusion of ministerial activity rather than part of a coherent and meaningful sustained strategy to restore consumer confidence in Irish beef?
I believe, as I am sure the Minister believes, that Irish beef is safe and nutritious; but our belief is irrelevant unless the consumer believes that too. We have got to the point where every crackpot can get air time and newspaper coverage for unfounded statements on the safety of food. Surely, the Department of Agriculture, Food and Forestry can find some experts of established scientific standing from the long litany of expensive consultants which it employs who can rebut extravagant claims?
Given the huge drop in European consumption and the probability that it may be impossible to recover consumption fully, there is a strong case to be made for a European funded campaign throughout the EU to promote beef.
I am pleased that the Minister has finally recognised the need to have direct consumer representation on Bord Bia. I moved an amendment to this effect on behalf of the Progressive Democrats when the Bord Bia Bill, 1994, was being enacted by Seanad Éireann. Unfortunately, there was very little support for the idea at the time, and it is good to see that parties who then would not support the amendment have now been converted.
As part of the overall research effort required to counter the crisis, there is a need for good up to date market information. We should have details of how Irish exports to Britain and continental markets have fared since the outbreak of the BSE crisis, and we should know by how much sales to our main European markets have fallen. If we are to target markets effectively, this type of information is essential.
Third countries account for half our beef and cattle exports. If Ministers could travel around the world for St. Patrick's Day parades, it should have been possible for them to get their passports to defend a vital national interest and to fly to countries which had closed their markets to us. Sending the Secretary of the Department of Agriculture Food and Forestry to the Middle East was a step in the right direction, but it was not enough. Iran and Libya remain closed, and these markets alone are worth a combined total of between £140 million and £150 million a year to Ireland. Only personal intervention at the very highest level will ensure that these markets are reopened. On two occasions the Tánaiste indicated he would go to the region. Instead, we have seen him travel on behalf of the Troika to South America and other places.
Last Thursday Minister Yates stated in the Dáil that he proposed "to visit Libya as soon as the necessary arrangements can be put in place." What are the necessary arrangements? I share his "disappointment" that the visit has not taken place. He said it was important to ensure that the timing and circumstances were right. What does this mean? The right time for him to go was when the market was closed and large chunks of it lost to Australia. Given the unprecedented number of Ministers in this Government, surely it should have been possible to find somebody to travel on Ireland's behalf.
The arrival of an Iranian veterinary delegation in Ireland is welcome, but it seems this is going about things the wrong way round. We should pay our Arab markets and customers the compliment of visiting them in their environment and of sending people of stature.
The dominant priorities for the Minister must be, first, to provide adequate compensation for the producers who have lost most heavily from the BSE scare and, second, the reopening of Ireland's third country markets. Consumers must also be reassured, and if that means maintaining a ban on British exports, that is what must be done irrespective of table thumping by the British.
The magnitude of the BSE crisis is such that it has the potential to impact significantly on our prospects for economic growth. The economic welfare of much more than farmers and beef factory workers is at stake. That is why I call on the Minister for Agriculture, Food and Forestry this evening to produce a decisive and coherent strategy at home, within the EU and on third country markets to ensure Irish beef and cattle can continue to make the contribution to national welfare that has been so significant up to now.
I welcome the Minister of State to the House and second the motion. There is a crisis of confidence among consumers about the safety of beef products and the implications for the Irish beef industry are huge unless there is a concerted campaign to counteract this. Our present arrangements for the policing of our food industry do not inspire confidence. The weekend press reported that there had been a collapse in the enforcement of food and hygiene regulations. As a result, we do not apparently know if British beef is being imported into this country and sold to unsuspecting consumers.
At a time when consumers right across Europe are only too well aware of the unsavoury reputation of British beef, it is remarkable that our much vaunted controls appear to be breaking down. We have no coherent system for quality assurance in the food industry. The Department of Agriculture, Food and Forestry, through its veterinary inspectorate, has responsibility for ensuring quality control in the processing plants, a task it has discharged none too well in recent years. The eight health boards, through their environmental health officers, are responsible for food quality and food hygiene at retail level in shops, restaurants and mobile stalls. These two separate bureaucracies are engaged in very similar work but do not seem to have any linkages between them.
In fact, due to an industrial dispute, there are serious problems in the implementation of the food hygiene regulations at retail level at present. A spokesperson for the Eastern Health Board, quoted in The Sunday Independent of 26 May 1996, gave a worrying description of the way in which the regulations are currently being enforced. The spokesperson outlined a situation in which there were up to 100 unlicensed food vans and stalls operating around the country, there was an unspecified number of other unsupervised outlets selling food and, in relation to BSE, beef and beef related products were no longer being sampled or checked. Effectively, the public servants responsible for enforcing the basic hygiene regulations have been refusing to do so since the start of the year. It is difficult in the circumstances to take seriously our commitment to quality assurance in the food sector.
Quality assurance and customer assurance are the key to success for the Irish beef industry. As long as market confidence can be maintained in the Irish product all doors will be open to it. Unfortunately, the BSE crisis has highlighted once again our failings in this area. We express great pride in the clean and green image which our beef enjoys, or which we think it enjoys, but this favourable image is useless and will rapidly disappear without proper verification standards. We have an advantage but we are throwing it away because of our inability to convince international consumers of how good and safe is our product.
The Department of Agriculture, Food and Forestry is the organisation responsible for policing the beef industry and it is fair to say its record in this area has left a lot to be desired. Two months ago, at the time the BSE story was first breaking, there was the disturbing revelation that a senior veterinary officer in the Department was facing criminal proceedings over irregularities regarding the sale of Irish cattle tags and health certificates to cover British cattle. This was hardly likely to inspire confidence in our official control procedures. There have been several other instances in recent years which have cast the Department in an equally unfavourable light in its handling of the beef industry.
It is time we looked at putting new arrangements in place for the policing of food production and the food processing industry which is of such vital national importance. We must be able to show that our food industry is being properly and vigilantly policed. We must ensure Ireland's reputation as a producer of natural and wholesome high quality meat is protected and verified. The Department too often sees itself as an agent of the producer and to a lesser extent, the processor. We need more independence, transparency and credibility if our policing arrangements are to be taken seriously internationally. If our food inspection system commands international respect, our food exporters, including our beef exporters, will benefit in terms of increased sales. In the free market, post-intervention era, producers and processors must recognise that unless they are seen to put the interests of the consumer first their industry has no long-term future.
It is, therefore, in the interest of all those involved in the beef industry, including producers and processors, that a new system is put in place. We need to create a single food inspectorate to handle all aspects of quality assurance and hygiene in the food processing industry. This would be an independent executive agency combining the functions of the Department's veterinary inspectorate and the environmental health service of the health boards. Producers and processors could be represented on the board of such an agency, but so also would people from the retail trade and consumer interests. If the consumer really is king in a market economy that should be reflected in the composition of the board of our national food inspection agency.
This option need not involve any appreciable additional cost to the Exchequer but rather the deployment of existing resources in a more efficient and effective manner. The new agency should be not just independent of the Department of Agriculture, Food and Forestry but be seen to be so. To this end, it should report to the Minister for Health or the Minister for Enterprise and Employment.
The new agency would ensure that consumers at home were adequately protected. It would also give assurance to foreign buyers in terms of quality, hygiene and product traceability, thereby ensuring that our food exporters enjoy a good reputation on foreign markets. This will be all the more important as we move inexorably towards an era of free international trade in food products. As we move into the next millennium the future of our beef export trade lies in supplying high value products to retail chains in Britain and continental Europe. This is a demanding, quality conscious, commercial market, far different to the heavily subsidised third country markets which currently absorb half our beef and cattle exports. We cannot hope to make major progress in commercial European markets unless we can demonstrate that we have reliable and dependable systems in place for ensuring the quality of our food products. Otherwise British and continental consumers will not want to buy what we produce.
We are the only European country sharing a land frontier with the United Kingdom and we have devoted considerable resources to sealing that Border to prevent the importaton of cattle and beef from Britain. However, the Minister for Agriculture, Food and Forestry or his colleague, the Minister for Enterprise and Employment, should clarify the position with regard to beef by-products, such as tallow and gelatin. The latter is a key ingredient in literally hundreds of confectionery products and other processed foods and in the Irish context most of these items are imported from Britain. Sweets and biscuits containing British gelatin appear to be freely available on the Irish market, as I am sure the Government is aware. Has there been any formal decision by the Irish authorities to ban these food products? Has that decision been rescinded? Perhaps the Minister could clarify the position on this important matter.
I am pleased with the approach taken by Senator Dardis and Senator Honan to this debate because a great deal of negative talking and thinking has taken place since this issue arose. The problems associated with BSE in Britain must not be permitted to drag the Irish international beef trade down with it, because that trade is essential to our economy and ensures a constant supply of highly nutritious food to consumers. The present crisis highlights the vital need to differentiate between Irish and British beef. This must be done in a sustained and intelligent way.
It never ceases to amaze me that those countries substantially involved in the beef trade — Ireland, the UK, countries of North and South America, Australia and New Zealand — do not join together to promote the virtue of red meat. The proposer of the motion asked for more publicity and for greater efforts at EU level but that is inadequate. I suggest that the Minister ensure that the EU gets together with the other beef producing countries to influence the consumer, who is the decision maker as far as the beef industry is concerned.
There is a lot of iron in red meat and, as we all know, problems related to iron deficiency are encountered worldwide, particularly among women and children. Therefore it makes sense for beef producing and exporting nations to join together to highlight not only the safety but the health enhancing properties of red meat, and beef in particular.
This is also a good time to promote the concept of the island of Ireland for the food industry, especially the meat sector. I have every sympathy for our fellow farmers in Northern Ireland who deserve to share in the image of our island as a source of quality healthy food. Cattle do not carry political tags and out of the present crisis we must develop a positive programme which will see the meat and livestock sectors in all parts of Ireland benefiting in the future when the present excitement and negative publicity have passed.
It is clear from the application of EU control measures to the UK and not to Ireland that our situations are not comparable — this is recognised by the European Commission and other member states. The UK has had over 160,000 BSE cases in a cattle population of 12 million; Ireland has had a mere 127 cases from a cattle population of 7 million and given the size of our national herd these are sporadic and isolated cases. The first was confirmed in January 1989; 11 cases were animals imported from the UK and one was imported from mainland Europe. Investigations into other cases suggest a possible link with meat and bone meal imported from the UK. Such imports, which took place only on a minuscule scale, were banned immediately, and rightly so. The age of the cows affected ranged from four to eight years old.
Beef cattle production in Ireland is based almost exclusively on a plentiful supply of grass and silage or hay with minimum use of manufactured feed. The feeding of meat and bone meal to animals has been prohibited, again rightly so. Nonetheless we have taken stringent precautionary measures to restrict the small number of herds in which a case of BSE has occurred. The implementation of these measures has been facilitated by the cattle identity system and the arrangements already outlined to control our present disease status.
The precautionary measures taken to isolate and eliminate the few BSE cases which have occurred include the following: the disease is notifiable under the Diseases of Animals Act, 1996; the entire herd in which BSE occurs is destroyed under official supervision and is thereby excluded from the food chain; and all local officials, veterinary staff and veterinary practitioners have been instructed as to control measures which should be taken when BSE is suspected.
The importation of meat and bone meal from the UK has been banned. Prior to this ban a licensing system operated with minimal imports. The importation of cattle, beef and beef products from the UK is prohibited in line with EU legislation and the ban is enforced rigorously. The use of meat and bone meal in animal feedstuffs has been formally banned by ministerial order. This has been the main source of BSE infection; I understand that 50 per cent of the cases can be attributed to the feeding of meat and bone meal.
Export plants and approved ports are subject to stringent veterinary control. Post-mortem inspections are carried out by official veterinarians at slaughter-houses to eliminate the possibility of suspected BSE animals getting into the food chain. The progeny of some affected cows have been purchased and are kept for research purposes at the Department's veterinary research laboratory where they are held in isolation from other animals.
On the basis of these stringent control measures we can certify that beef and cattle exports from Ireland are derived from animals which have not presented suspected or confirmed signs of BSE and that the animals come from herds in which BSE has not been detected. The beef comes from animals which are slaughtered in approved premises under the permanent veterinary supervision of the Department of Agriculture, Food and Forestry. Each animal is examined live for signs of disease and the carcase and offal are subject to post-mortem examination by an official veterinarian. All exports of beef are accompanied by a health certificate signed by an official veterinarian certifying the whole-someness of the meat being exported.
All live cattle exports are subject to a detailed examination by an official veterinarian at the port of dispatch. This involves a clinical examination and a check on the identity of each animal by examining the official ear tag and card. Following inspection, a health certificate and a fitness to travel certificate are issued by the official veterinarian.
These essential measures have been put into operation. We have had a good deal of bad publicity and we should call on the UK to try to relax the situation. The UK Government is now trying to disrupt the business of the EU which does nothing but highlight its negative position.
The consumer is the controlling factor. Unless we can convince the consumers beef is safe they will not buy it. The Government must act quickly to counteract the bad publicity. I urge the Minister to join the other beef producing countries and to promote the virtue of red meat. Beef sales in America, Germany and France have fallen by 50 per cent. That trend must be reversed if there is to be any future in the long term for beef producers.
I compliment Senator Dardis for proposing this motion. The issue requires urgent attention. Senator D'Arcy referred to the Government taking action on a world scale but it should concentrate on the home industry. I am glad Senator Dardis outlined the inactivity of the Government in ensuring the safety of our beef markets. I am pleased Senator D'Arcy agreed the Minister has not done enough. The Minister's failure to go to Libya last week coincided with the loss of a contract for 140,000 head of cattle.
The compensation package on offer from the EU will not help the Irish farmers worst affected. The Minister has admitted as much but no remedial action has yet been taken. The 6,000 workers in the beef industry are becoming increasingly anxious about their future. The Government blamed the last month's rise in unemployment on the problems in the beef industry. The job crisis in the beef factories is now in danger of becoming a self-fulfilling prophecy brought about by the Minister's declaration that 3 million cattle will have to be slaughtered.
Confidence in the beef sector is very low and there is mounting anger at the Government's approach to the largest industry in the country. The Government must get the message that it must act now. As Senator Dardis said, the Minister should have visited other countries. The Fianna Fail spokesman on agriculture, Deputy Cowen, visited Iran accompanied by two Fianna Fáil Deputies to assure the Iranian Government that Irish beef is safe. The Government should follow their lead.
The problems in the cattle and beef trade could have repercussions in other sectors. This is an indication of the long standing need for a national food plan. I support Senator Honan's reference to the creation of an agency independent of the Department. The reform of the CAP and GATT have led to less access to intervention, lower volumes of product eligible for export refunds and lower rates of export refunds. These factors meant increased products with lower assistance towards disposal. In addition, countries such as Australia began to get a foothold in traditional markets for Irish cattle.
The BSE scare caused a sharp downturn in consumption. The twin problems of increased production and decreased consumption have led to a market crisis which has the appearance of being long term. The loss suffered from the crisis will be all the worse if Ireland does not put in place practices to regain consumer confidence. The downturn in beef consumption is due to the BSE scare and the consequent image of our beef being unsafe. However, that image can be corrected over time.
There is a real danger the European beef industry will suffer permanent damage unless concerted action is taken. However, it would be wrong for Ireland to wait for a European programme of action. Ireland should take the initiative and establish its own programme while at the same time pushing for a European programme of action.
It is likely that recovery will mean that trade in beef will be at prices far lower than experienced in recent years. The main factors in determining levels of profitability will be volume sold and efficiency of operations. The volume sold will depend largely on consumer confidence. Hence, the absolute necessity to tackle that aspect immediately. The longer the delay the more permanent the damage and the longer it will take to rectify it.
The guarantee of safety is the most essential element in restoring consumer confidence. Consumers must be provided with cast iron assurances of the absence of undesirable practices and substances in every step of the food chain. Assurances are useless unless backed by independent certification and that is where the agency Senator Honan mentioned would operate. The Irish food industry should establish an inspectorate to certify all aspects of production, processing and storage. The standards to be certified should be agreed between the producers, processors and consumer representatives. Thus the standards could be reviewed and updated periodically to ensure the highest standards of excellence.
In the dairy industry the producers and the processors co-operated in a programme to ensure quality. They worked together to produce quality products; if producers used illegal substances, such as antibiotics, they were fined and a higher price was paid for premium milk. The dairy products can also be traced. One can buy butter or milk in a shop knowing its origin. Such a system should be introduced in the beef industry to ensure the product will have the image it deserves. Even the best food in the world needs promotion.
Use should also be made of the standards applied which should always be higher than those of the EU and other competing countries. Our island and green status should be portrayed as a unique advantage. The protection of the environment in a manner which ensures that no pollutant enters any aspect of the food chain is vital in the portrayal of the green image of our food. Promotion of food and tourism should be complementary. The best possible environment is an essential ingredient for both industries and, accordingly, joint packages should be arranged.
National events which attract and receive international media coverage including, the All-Ireland Hurling Final, in which Limerick will compete this year, the All-Ireland Football Final, the Five Nations Rugby Championship, the Eurovision Song Contest, which will be staged in Limerick, horse racing, etc., should be used to promote the image of the country as the world best food producing island. There are various ways in which the tourism and the food industries can complement each other. A national plan must be implemented to ensure that beef is produced and promoted in such a way as to restore consumer confidence here and throughout the world.
I am glad to have the opportunity to speak about the problems facing the beef industry because of the BSE scare and other factors. At the weekend I met farmers who were disgusted at the carry on in the Dáil last week when the beef industry, which is worth about £1.7 billion per year, is in crisis. Some Members of the Dáil seem to be more concerned about a mistake in relation to sending a republican prisoner to Northern Ireland. The farmers to whom I spoke thought the priorities of Dáil Members were wrong and that they should be discussing the crisis in the beef industry.
The problems in the beef industry started when the GATT agreement was concluded in 1993 and when the CAP was reformed. Under that agreement the volume of subsidised beef exports from the EU was reduced by 21 per cent while, at the same time, subsidies were to be reduced by 36 per cent over the period from July 1995 to the year 2,000. At the same time the GATT restrictions came into play, the CAP was reformed to dovetail into the new situation and a system of direct payments was introduced for farmers. A subsidy of approximately £200 per steer is now available and area aid stands at well over £100 per acre of barley, etc. The thinking behind this appears to be quite sound in that more beef could be produced at a price which the consumer could afford to pay.
Because of a number of factors outside the control of farmers and the Government, things did not work out according to plan, that is, the price of feed inputs remained very high as did the price of suckler calves and stores. GATT came into play and the EU Commission cut beef export refunds by 12p per pound and £8.50 per hundred-weight live weight. It is clear from that that winter fatteners had the worst of both worlds. This action took place at the worst possible time for the fatteners; it appeared it was designed to put them out of business.
When the announcement on BSE was made in the UK on 20 March beef markets collapsed in the EU as a whole leaving winter finishers high and dry. According to Teagasc figures, farmers lost £71 per head on sales between January and mid-March and a loss of £138 per head is expected on sales between mid-March and June. Producers of factory type young bulls and heifers are also losing heavily.
The IFA's request that winter finishers should be compensated for the loss they suffered through no fault of their own is valid. While I know there is no mechanism to help the producers of factory type young bulls and heifers, they too should be compensated because they were caught in a situation which was beyond their control and not of their making.
The Minister should look at the IFA's proposals on the deseasonalisation premium. As a result of the BSE crisis there was a significant fall off in steer slaughterings at the beef export plants from 25 March. The EU deseasonalisation premium was reduced from £60 per head to £45 per head on 15 April and reduced further to £30 per head on 29 April. In view of the fact that animals could not be sold because of the BSE crisis, the IFA demands that a full level deseasonalisation premium of £60 per head be paid on all eligible steers slaughtered up to 9 June. The IFA claims this proposal is budget neutral for the EU Commission and it is something worth following up. It should not be forgotten that because we export 70 per cent of our steer beef to world markets, Irish cattle prices are more sensitive to cuts in export refunds than those in any other EU member state.
Taking into account the consequences of GATT, the BSE scare and the way the beef industry is handled, it is not hard to see we have a real crisis on our hands which will not be resolved until consumer confidence in the industry is restored. In that context, we should look at the way the farmer co-operatives looked after and managed the dairy industry in the interests of farmers, consumers and the country. They deserve great credit. Thank God they rather than other people were in charge. The dairy industry diversified, raised standards and cut out bad practices. When people buy a dairy product they can be confident they are buying a good one. I am afraid the beef industry did the opposite.
We should do everything possible to restore confidence in the beef industry. While there are disadvantages in the industry, there are also many advantages in that we produce beef mostly from grass and cereals. We should decide to have a good beef industry and spare no expense in pursuing that objective. We should also make a decision on meat and bone meal. We should burn it and use the ash. Perhaps we should explore ways of using meat and bone meal in the ESB power station under construction. It is in the interests of farmers, consumers, factory workers and the nation that no effort is spared to put the beef industry back on the rails.
I am delighted to have the opportunity to discuss the beef industry. When I spoke about the industry on a previous occasion I raised a number of issues which I would like to tie into this debate on BSE. This morning we had a discussion with representatives from the Norwegian Parliament. In response to a question I put about why Norway did not feel ready to join the EU, they said that their agriculture and fishing industries would suffer if they were part of the EU. I do not subscribe to that view but it is interesting that they should hold such a view. An issue which we need to address is how our industry is surviving in the EU and under pressures like the BSE scare.
I support the motion. The industry needs much support at this time, but the type of support it has received to date is wrong. Other Members will not accept it, but the export subsidy, which is not available to Norwegian farmers, is playing a part in destroying the Irish industry. I will develop this point because people representing farming interests disagree. I am not farmer bashing; the agri industry deserves all the support it receives.
A farmer who buys cattle in the spring or summer to fatten them and sell them after the new year and who depends for part of his profit on the export subsidy is being ripped off from the day he buys the cattle. The farmer is only interested in the margin between the buying price, the cost of fattening the animals and the selling price. People recognise the export subsidy will be available to the farmer when it comes to selling the animals and therefore it is discounted when the animals are bought.
A long-term approach to getting rid of the export subsidy would be in the best interests of farmers because they would buy cattle cheaper and, on a proportionate and percentage basis, their margin, based on a lower buying price, would in effect give them a larger profit and also greater flexibility. I do not expect great support for this viewpoint but it should be suggested and considered. Farmers have been misled on this issue and it should be seriously examined.
It is disgraceful that the agriculture community has been bombarded by incorrect and inaccurate media reports based on unsubstantiated and supposedly academic views on BSE. There was another example of this last night when a supposedly learned professor said that the land on which BSE infected cattle grazed should not be used for a certain number of years. This type of nonsense should be knocked straight on the head. It creates a scare among people buying beef and the rug should be pulled from under it.
The farming community needs support at this time more than it has ever needed it in the past. This involves giving the public confidence. The odds against beef, including UK beef, being unsafe should be made clear to people. The idea that it is unsafe is extraordinary. I was in Belfast recently and I ordered a steak. The man serving me in the restaurant said I was the first southerner to order a steak there in the last three months. I had not thought of BSE when I ordered the steak — I was not making an issue of it either way — but this demonstrates the impact of the current problem.
It is also important that Irish people understand the level of risk or non risk posed by UK beef. It is too parochial, and it will rebound on us in the future, to view this matter just as an Irish problem. It must be looked at from the Irish, UK and European points of view. We must support the Irish beef industry at this time and the way to do this is to explain to people that our beef is safe. This should be done in the most public way possible.
This is a highly political issue and there is a tendency on this side of the House for speakers to blame Ministers, Governments and Taoisigh for not travelling the world and selling the message. However, from an independent stance, the Minister for Agriculture, Food and Forestry has gone out of his way to try to sell the viewpoint of the Irish farmer in the Middle East, Near East and Europe. He has held a firm line and I compliment the Department on the line it has taken at veterinary meetings at European level. It has tried to give some element of understanding of the UK point of view, which is important in a variety of ways. It is too easy at this stage to take a Brit. bashing approach and bury the UK industry. Its position also needs to be understood.
It would be worthwhile if the Minister made clear in his response the reaction of the IFA to a previous Government's decision that the whole herd should be slaughtered if a BSE case was discovered. The farming community should be reminded that it did not enthusiastically support the progressive and visionary position taken by the Government at that time.
I wish to link this matter to other aspects of the food chain. I raised this matter earlier today and I will refer to it when the House is discussing the An Bord Bia Bill. The issue of consumer confidence, which is what this matter is all about, is huge. There have been a number of occasions over the last three weeks when this aspect should have been carefully considered. There was a debate in the past two weeks about the danger or non risk of salt in the food chain. However, much of the evidence is presented by people with a vested interest in the food processing industry.
I do not know whether salt is dangerous; I just know what I read. However, as a consumer I should be told the truth and I should be in a position to insist that I hear it from the Department and the Minister. The same point applies to the current debate on baby food and whether certain brands are dangerous in terms of their ingredients and their reactions. The Department should look beyond BSE and consider consumers' confidence in the food they are eating. It is a wider issue and we should insist that the British authorities divulge all the available information to the Department so the Minister can make it clear to consumers what is safe and unsafe.
I support the motion and I congratulate Senator Dardis for tabling it. People might not agree with all my points, but the industry needs support at this time. It is in all our interests, whether from trade union, consumer or agriculture points of view, to support it.
I welcome the Minister and I congratulate the Progressive Democrats' for tabling the motion. It is important the House has an opportunity to discuss the matter. The Leader of the House said the Government intended providing time for a debate, but we must thank the Progressive Democrats for ensuring the discussion took place at the earliest possible date.
There is no doubt the current crisis is one of the worst to hit the agricultural community in many decades. It is also one of the worst to hit the economy and it will have serious implications in that regard. We must do everything to ensure the situation is improved. The crisis must not be allowed to destroy the beef industry, the livelihoods of many farmers and a vital part of the economy.
Britain's over reaction to the situation has caused a problem which is totally out of proportion to the true position and the severity of the crisis. We must endeavour to do everything possible to counteract this aspect, but one of the difficulties in this regard is the movement in Europe towards the consumption of beef produced in their own countries. It is difficult for another country to secure a footing in that market but we must try to identify Irish beef as prime quality meat which is disease free, produced in a natural environment under strict control systems and subject to strict monitoring throughout the process and identifiable back to the producer.
We must ensure our marketing is aimed in this direction. In the past Irish beef was badly marketed. Throughout the decades individual producers did not ensure added value was applied to beef or that there was a shelf rather than an interim product. Too much of our beef went out on carcass and was not often identified as Irish beef when being processed further. We failed over the years to create a strong image of the quality of our beef. It must be important that we do everything in our power to do so. I would support Senator Dardis in his statement that all beef exporting agents must ensure that they are part of it, that there is a co-ordination. We must recognise that negative publicity will continue for some time and it is going to be difficult as a small nation to counteract it.
I agree with Senator D'Arcy that all exporting countries throughout the world must get together, because it is a world-wide problem and we must bring back support. I talk to people. They are concerned, even though we have regained up to 90 per cent of our market in Ireland. They still discuss, and have fears about, the consumption of beef in Ireland.
We must also ensure there is no cross-Border underground trade in cattle. This would be a worry. The Minister for Justice and the Minister for Agriculture, Food and Forestry have made strong moves in this area, but no stone must be left unturned to ensure there is no cross-Border transfer of cattle. If this were to happen, even on a small scale, it could have disastrous effects on the work we are doing to regain confidence in our beef.
I congratulate the Minister, who has endeavoured to do everything he could within the context of the EU to improve the situation. At an early stage he was successful in efforts to introduce effective market support systems. He ensured compensation to the producers who had lost income during that time. The emergency arrangements were quickly put into effect, including the lifting of ceilings on carcase weight and various other measures. The Minister has been effective and must continue to work towards ensuring all the force of the EU is brought to bear in assisting Irish farmers at this crucial time.
There is concern out there about the future drop in cattle prices. We cannot forecast what will happen, but if cattle prices drop further there is going to be a severe income crisis for many farmers and it will also be serious for consumers. Beef cattle are not exactly the best producers of income for a farmer in comparison to the dairy sector. We must recognise that a careful approach was taken by the Department of Agriculture, Food and Forestry, since BSE was identified in Britain, to ensure our herd and good name were protected. The various measures which came in over a period of years going back to the original identification, including the slaughtering of animals, have ensured we did not go down the road that Britain did. We should also recognise that the renderers and the Department of Agriculture, Food and Forestry did not fall into the trap of easy cost savings by reducing the temperature at which the rendering was completed.
I would like to take up one point raised by Senator O'Toole which is important. We should recognise the UK point of view. We should be understanding of their situation. I was glad to see that the Minister supported Britain in its recent bid to improve its situation. We are all partners in Europe. It is easy to be populist in how we react against Britain within the European scene, but it is important we do not go overboard on this. We should be sensitive and supportive to the British view.
One man's meat is another man's poison. This affair developed from the manhandling of the BSE scare in Britain. That is of vital importance because as late as today I was informed that in Germany there are signs up saying "no Irish, no Northern Irish and no British beef on sale in this supermarket." The Minister and his officials will have to take this up at a high level within the EU. While this pertains within the EU we have no hope of dealing with the falling cattle prices and the closing of markets throughout the EU and the rest of the world. Something must be done at EU level to ensure EU markets are open to Irish beef.
Two things must be done. There must be a long term marketing strategy and we must assure we have standards in place that can guarantee the safety of Irish beef. In the meantime I make a strong plea to the Minister of State to go back to his Government colleagues and make sure a package is put in place. This should include cheap interest loans, or a mechanism through the Department of Finance and the lending institutions to override the problems we face with farmers who have stocking loans and cannot dispose of their stock at present market prices. If we do not do this we will have a crisis in that farmers and their families throughout the country will go to the wall.
When the veil of public relations is lifted from the Minister he will realise he has been inactive in this instance. We can talk about marketing and long term strategy, but in the short term a package has to be put in place to alleviate the burden being placed on thousands of beef fatteners here. People are bringing their cattle back from mart. Farmers are being informed their cattle cannot be slaughtered because there is no market for them. Farmers are in dire financial straits. Incomes are dropping rapidly and they could lose their livelihoods.
Minister Ivan Yates has done a lot in regard to public relations. Everyday we see statements from the Minister. But his practical approach in trying to market Irish beef across the world, particularly in Iran, Libya and other Third World countries, is disappointing. The Iranian or Libyan markets are not accessible for Irish beef. For Senators opposite to talk about a global approach to the red meat trade is impractical. Australia and Argentina are laughing at the failure of this Government and the EU to come to terms with this crisis. While Irish beef is banned, Australia, Argentina and other beef exporting countries are soaking up those markets. If they are not open soon to Irish beef I fear for the long term viability of the beef industry. Boats presently anchored were booked to take cattle to Libya and Egypt; but because of the current difficulties there is no guarantee the animals will be paid for when they arrive. While we would like to think that the Minister or the Government have done something, they have failed. Irish beef is not acceptable within the EU——
There is a shortage of proposals.
——and if we cannot convince our European counterparts we have no hope of convincing Third World markets and those farther afield because they always consider Ireland to be a part of Britain. This problem must be resolved immediately. Third World countries, for what-ever reason, immediately lump us with the United Kingdom. We have failed miserably to point out that we put in place definite procedures when BSE was first identified as a threat to beef herds and that we took stringent measures to ensure it would not escalate and wipe out the entire industry, as has happened in Britain.
In the last few weeks the IFA has spoken to various political parties and I am sure the Minister is in regular contact with it. However, I am disappointed with the approach taken by the IFA and the Government in the handling of this affair. If we had a crisis of this magnitude at any other time, I am confident Molesworth Street would be black with people protesting about it.
Why does the Senator not give us some proposals?
I have been giving some, if the Senator had been listening.
All he is doing is criticising.
There is a lot to criticise.
That is typical of all his colleagues.
I have some constructive proposals. First, we must alleviate the income crisis currently facing farmers. I urge the Minister for Finance to provide funds through the various lending institutions to help farmers with the credit problems they will soon face. We will not be able to open up markets in time to ensure their products are sold. Second, we should meet at the highest level the Germans and other nations, who are obviously biased against our beef if they allow their supermarkets to conduct this unfair trading. We should tell them that this must be rectified immediately. Finally, the Minister and the Minister for Foreign Affairs should travel to the markets currently closed to our beef and point out to them that it is safe, that in the past we put in place procedures that ensure BSE is not a problem and that, therefore, there is no reason for closing those markets to our beef.
Markets are being closed to Irish produce. Neither the Minister for Foreign Affairs or the Minister for Agriculture, Food and Forestry have done enough in their own personal capacity to ensure that markets are reopened to our beef producers. The Minister might achieve something at the end of the day if he took these ideas on board.
Consumer confidence is central to the ongoing success and expansion of the beef industry which, together with the wider food industry, is one of the main pillars of the Irish economy, providing both direct and indirect employment and playing a central role in our export economy. Rumours of angel dust, the shenanigans revealed during the Beef Tribunal and the recent British BSE scare have all combined to undermine consumer confidence in Irish beef. Irish beef is one of the best products on the market today.
Senator Kelleher referred to boats being held up in Cork harbour. I have been advised by a producer that these boats have been there for some time. While I was given a different reason to that put forward by Senator Kelleher, it is still a fact and some producers are paying excessive interest rates. I ask the Minister to let us know at a later date the cause of this problem. At least two producers brought it to my notice. I did not raise the matter because I thought it might have been resolved by now but this does not seem to be the case.
There is undoubtedly a handful of unscrupulous individuals in the production and processing sectors who willingly place profit above consumer safety. While they exist, they are in the minority. I could not put a dossier together on the complaints one might receive, but underhand dealings do exist. Tags could be switched, for example. I cannot supply positive proof but there is no smoke without fire. I have no doubt they will be weeded out and I want to see this happen. It is in the interests of the beef industry as a whole for all those involved in it to unite with the Government in ensuring that rogue operators are not allowed to sully the reputation of Irish beef.
The response to the current BSE scare by the Department of Agriculture, Food and Forestry has been both rigorous and principled. The Minister's assurance that in future meat from all herds where BSE has been identified will be destroyed is continuing evidence of the Government's determination to ensure that the high reputation of our beef is maintained. In the long term there is a need to establish a more distinctive Irish identity for our beef — other speakers referred to this — and I look forward to further progress in this regard. We have no evidence that progress has been made despite the fact that the issue has been raised on previous occasions. This will go a long way towards allaying consumer fears, especially in the export market, and avoiding confusion of the Irish product with products sourced elsewhere.
Our beef industry is being asked to pick up the tab for UK mismanagement, especially during the 1980s when the Tories promoted wholesale deregulation with a missionary zeal. In this regard I hope that Ireland, together with our EU partners, will call the Tory bluff in regard to its bizarre threat to block all EU business until the ban on British beef is lifted.
The interim EU decision to maintain the ban on British beef until appropriate measures are put in place was taken in the best interests of farmers and consumers throughout the EU, who have been hit hard by an EU wide crisis of confidence in beef following the BSE scare, which originated in the UK. This is not the first time the UK has assumed a lone ranger role in the EU. Attempts to block State aid packages for Aer Lingus and Irish Steel are some of the most recent examples of UK intransigence.
The time has come for the EU to call the Tory bluff. In reality there will be few debates during the Intergovernmental Conference which are likely to be affected by a UK veto. I hope that EU Agriculture Ministers will not allow themselves to be influenced by Tory bluster during the Council meeting in early June and that they will continue exerting pressure on the UK to put in place a scientific programme to deal with BSE in advance of the ban being lifted. The long-term cohesion of the European Union will be severely threatened if EU member states cave in to the UK in this regard.
Our agriculture industry and entire economy faces a disastrous future if immediate action is not taken by the Minister and the Government to tackle the on going BSE crisis. The entire affair is a disaster for our whole economy, which is highly dependent on a successful agricultural industry. As a result of the BSE crisis, agricultural incomes have collapsed. As beef prices continue to fall this week, beef procedures are losing huge amounts of money with no sign of any improvement in the market. Cattle sales throughout the country in the past week are reporting disastrous prices with most cattle unsold. In one case a mart had to close as no bids were being offered. Factory quotes are low again this week.
Live exports to third countries have fallen by 40 per cent in the first five months of 1996 — from 93,192 in 1995 to 55,572 in 1996. Prices to farmers have dropped by £100 per head since the BSE crisis arose and it is anticipated they will drop by an equivalent amount again if urgent action is not taken by increasing export refunds. There was the lack of foresight on the part of the Minister for Agriculture, Food and Forestry in not supporting a drive to increase export refunds for live cattle to third countries during the spring season, resulting in Australia shipping 40,000 cattle to Egypt in the first five months in 1996.
Ireland shipped 37,000 fewer cattle to Egypt in 1996 than in the same period of 1995. Due to the BSE crisis Egyptian consumption of beef in the past month has dropped by 30 per cent. Market price has fallen by 20 per cent along with a seasonality drop of 10 per cent. The Libyan market is closed to Irish cattle. Market potential for the year 1996 was 50,000. Funds were available in Libya to purchase that quantity of cattle. The Irish Government should send a trade delegation, which includes the Minister for Agriculture, Food and Forestry and other Ministers, to Libya for trade negotiations.
Irish beef is a product of unique quality and consumers should have no fear of buying our beef. That is the message we must get to our markets. The Government must urgently ensure the return of Irish beef to its former markets throughout the world. Ireland acted promptly in all cases of BSE, quickly slaughtering the entire herd in which an outbreak occurred. Since 1989 there have been only 124 cases of BSE in Ireland out of a population of seven million animals. In Britain there have been 160,000 instances of BSE in a cattle population of 12 million. Britain took no action and, as a result, all of Europe has suffered from this problem since 1979.
The action of the British Government this week in disrupting European Union business is outrageous. I urge the Government and the Minister to stand up to these shameful tactics. They must not allow Britain, which has brought such hardship and financial ruin to our country, to blackmail the European Union. Had Britain taken the same action as the Irish Government when the first instance of BSE emerged — the immediate slaughter of herds and the imposition of a ban on the use of all meat and bonemeal for cattle feed — we would not be in this situation today.
Ireland is suffering more than any other area of Europe because the beef industry is such a large sector of our economy. It is worth over £1.6 billion per annum, or 10 per cent of our GNP. I call on the Minister and the Taoiseach to fully compensate the loss incurred by Irish farmers due to the inaction of the European Union and Britain on this matter. The evidence is that Irish beef is a quality product with disease free status. That is accepted nationally and internationally. The Government, An Bord Bia and our exporters must launch an aggressive campaign to promote Irish beef at home and abroad and to counteract the crisis of confidence among consumers about the safety of our beef product.
I ask the Minister of State to convey our message to the Minister and the Taoiseach. I hope we will get results and that our farming community will receive the Government's support.
I wish to share my time with Senator Farrelly.
An Leas-Chathaoirleach
Is that agreed? Agreed. Each speaker has four minutes.
I am pleased to have the opportunity to debate this motion and Senator Dardis and Senator Honan deserve our thanks for putting it before the House.
No Member of the House would minimise the problem facing the Irish beef industry and the farming community. Everybody is aware of the severe drop in cattle prices that is causing considerable problems for farmers throughout the country. Figures have been produced by the IFA, Teagasc and the Department to show the losses that have occurred. In some cases losses were calculated at about £80 per head up to the end of March. There has been a loss of approximately £150 per head since then. Factory prices have seen a reduction from £1.12 per pound in May 1995 to about 90p to 92p per pound in 1996. That illustrates the problem we are facing.
Irish beef is unquestionably one of the finest and safest foods available and it is important to ensure that customers and consumers are aware of its excellence. An Bord Bia and the Department have succeeded in obtaining many new markets for Ireland and they have done much excellent work. However, their efforts must be redoubled.
The Minister for Agriculture, Food and Forestry has been criticised for not doing enough and not visiting enough countries. My recollection is that he was caught up in Brussels for long negotiations when the crisis arose and he was good at putting forward the Irish viewpoint. Few will argue that the Minister is an able, energetic and skilled negotiator. He has visited Spain, Italy and France. He is in Russia today, where he opened an office on behalf of An Bord Bia last October. It is hoped that this year 100,000 tonnes of Irish beef will be sold to Russia at a price of approximately £350 million. Further visits are planned.
This crisis was not of our making. Ninety nine per cent of the blame for the crisis rests with the Department of Agriculture in Britain and with the British Government. I regret that I must criticise the British Government for obstructing the business of the European Union; I condemn its future plans to disrupt that business. This will be a major mistake and will only succeed in highlighting the wrong images. If somebody wishes to cover something up, they go on the defensive and people recognise there are problems. The British should tackle these problems rather than attempting to cause disruption.
Consumers will not be bullied into buying beef. The only way to encourage the customer and restore confidence in Irish beef is to explain the nature of our product. This has been a fair debate and Members have displayed goodwill in attempting to resolve this difficult problem. I wish the Minister and Minister of State every success in their task.
I thank Senator Enright for sharing time with me. I also thank the Progressive Democrats for providing us with the opportunity to debate this motion.
The Irish cattle industry has entered a state of crisis in a very short time. This was not the result of our own actions. I firmly believe the BSE problem in Britain got out of hand following the identification of 160,000 cases of the disease. The authorities decided the only way to deal with the problem was to raise it on the European stage and obtain compensation for the removal of infected animals from the system. Unfortunately, they did not realise the consequences of their actions.
The Irish media has played a disastrous role in exacerbating this situation. I agree with the point made by Senator Farrell on today's Order of Business that, every time this problem is discussed on television, RTE shows footage of a cow which is not of Irish origin. I take exception to the continuation of that publicity which is damaging many people. When the Minister of State at the Department of Foreign Affairs, Deputy Gay Mitchell, was recently en route to a Third World country, Ireland's 127th case of BSE was identified. Before he arrived in that country, Sky News issued a report that further cases of BSE had been discovered in Ireland.
The media has a responsible role to play in ensuring that Ireland is given a fair crack of the whip with regard to its beef products. The media has been completely irresponsible where the livelihoods of thousands of individual families can be affected. I would welcome visits by members of the media to farms where these animals are produced. They would discover that Irish farmers are not responsible for the situation that has developed.
I am glad the Taoiseach has established a committee to look into the serious consequences of this affair on the Irish economy. During his term of office as President of the European Union, it will be the only way to progress the argument that we require further help in this area.
In conclusion, I hope that heifer producers will be considered when the compensation is being paid. I refute the argument that nothing has been done to deal with this problem which is the most serious to affect our major industry. I would like to believe that, as politicians, we can help to rectify this problem. I identified some of the issues with which we must deal and journalists describing these issues must do so in a particularly responsible way.
I would like to share time with Senator McGowan.
An Leas-Chathaoirleach
Is that agreed? Agreed.
I support the motion. This is a very serious issue. I support Senator Farrelly's criticism of the media. It is very sad to see the national television station showing seven year old footage of an animal staggering around a farmyard. The Government, farmers' organisations and farmers themselves must then scramble to restore confidence in the quality of Irish beef at home and abroad. This national sabotage occurs daily and Irish housewives are being scared away from buying quality Irish beef as a result. Would RTE accept it if a rival television network used questionable footage to damage its image? I recently met with representatives of the farmer's organisation and informed them that they should bring this matter to the attention of RTE.
We are facing a crisis which could be as bad as the one that occurred 22 years ago when calves were abandoned at marts because it was not worth the owner's while to bring them home. The price of calves has already dropped to between £20 and £30. The price of beef, store cattle and calves have been badly affected by this crisis. We have seen only the tip of the iceberg. It does not bear thinking about the lengths to which average European farmers will be obliged to go to feed and educate their families, particularly if their bank mangers are breathing down their necks. Senator Kelleher made the point that banks should provide short-term loans until farmers can sell their cattle. The situation must not be worsened.
Some shipping agencies are refusing to transport sheep and cattle from this country. It is shocking that this problem exists and I am aware that do-gooders may have caused it. We face enough difficulties attempting to build up foreign markets without being unable to transport our products out of the country. The Minister for Agriculture, Food and Forestry should do all in his power to restore our markets in Egypt, Libya and elsewhere. No other country in Europe depends more on the export of beef and store cattle than Ireland. The Ministers for Agriculture, Food and Forestry and Foreign Affairs and the Taoiseach must deal with this matter.
What we are experiencing now is worse than the economic war between Britain and Ireland in the 1930s. I appeal to the Government to deal with the matter urgently. There is no point despatching senior civil servants or departmental secretaries to do so. This does not indicate enough seriousness and urgency on our part to rectify the situation. I request that the Government invest more money in research and into the marketing of Irish beef. Much research is required into the problem of mad cow disease. We are facing a serious crisis and we should work together.
A great deal has been said by Members of the Oireachtas on this very serious problem. The fact that a neighbouring country has 162,000 cases means we have to be realistic. Our problem is our neighbour. Our 100 mile border with Northen Ireland presents us with a difficult situation. I listened this morning to those complaining about gardaí being transferred to the Border. However, we should ask what would happen if they were not transferred. Some farmers in England who had to have their cattle slaughtered were allowed to take them home for their own use. There is no control of that situation. It is not too hard to land a container of beef in the North. If our borders are not protected the number of cases here will soon be in line with those in Britain.
I have a proposal to make, regardless of whether it is important to make one at this stage. We can make as many speeches as we like but the bottom line is restoring consumer confidence. The one way to do that is to destroy every cow. I have stated on numerous occasions that a cow has a life of eight to 12 years and is dosed four to six times a year for mastitis and so on. When a cow reaches the age of eight or ten years she has done her service. Dairy farmers and those who own cows might complain but there is a need to restore consumer confidence.
There is no point in just destroying the aged animals as the consumer will not accept that. Those who own cows should be compensated by the EU or the Government. I listen to the comments of beef consumers every day and most are in the same situation as I am. I ask the Minister to think about this because drastic action must be taken to restore consumer confidence. It is sometimes suggested here — and all the time in Britain — that the older animals must be destroyed. That is not acceptable. There has to be clear action which everyone will understand. It might be drastic, but such action has to be seen to be taken. I ask the Minister and the Department to look at that proposal, which I make with the knowledge and consent of hundreds of small farmers who depend on cattle production.
I compliment Senators Dardis and Honan on raising this matter. It is a very serious matter of crisis proportions and is unlikely to go away for some time.
I propose to respond to this motion under a number of headings. First, I think it is important to place on record the position of Ireland in relation to BSE. To date, Ireland has had a total of 127 cases of BSE since the first case was confirmed in 1989. This incidence, which represents an average of 16 cases per year, must be viewed in the light of a cattle population of seven million animals. By comparison, the United Kingdom has had over 160,000 cases in a cattle population of about 12 million. Ireland is classified by the OIE as having a low incidence of BSE.
A comprehensive system of control measures has been put in place in Ireland to ensure that consumers, both at home and abroad, can have confidence in Irish beef. BSE is compulsorily notifiable. Monitoring, including both ante and post mortem inspection, is carried out at meat plants and any suspicious cases are referred for diagnosis. The use of meat and bone meal in ruminant rations has been banned since 1990. BSE confirmed animals are destroyed and buried or incinerated, with full compensation being paid by the State to the herd owner. Entire herds in which BSE occurs are depopulated at full market value and the carcases of such animals are now rendered into meat and bone meal so there is no possibility they can enter either the human food or animal feed chain. The progeny of infected animals are traced and destroyed or otherwise held for research purposes.
The current crisis in relation to BSE was triggered by the announcement by the British Health Secretray in the House of commons last March regarding possible links between BSE and its human equivalent, CJD. Notwithstanding the tentative nature of this link, this statement had a significant effect on consumer confidence in the safety of beef, not only in the United Kingdom but in all EU member states, including Ireland, and in third countries. In this respect, the Government here acted quickly to reassure Irish consumers through the establishment of an experts advisory group composed of experts from the medical and veterinary professions, as well as representatives from various Departments, the grocery trade and consumer interests. The group concluded that on the basis of all the medical, veterinary and scientific advice available to it, Irish beef and beef products were safe to eat and could be consumed with confidence by consumers.
The developments also demanded a response at EU level. In the immediate aftermath, the Commission decided on 27 March 1996 to prohibit the export of all live bovine animals, semen, embryos and products containing bovine material from the United Kingdom to any other destination, with the exception of those containing bovine material which originated from animals slaughtered outside the UK. Since the adoption of that decision, the World Health Organisation and various EU scientific committees have re-examined the situation and have concluded that products such as gelatine and tallow which have undergone certain manufacturing processes and bovine semen could, with safety, be excluded from the export prohibition. As the standing veterinary committee was unable at its meeting on 20 May to give a favourable opinion on a Commission proposal to this effect, the Commission has now submitted the proposed decision to the Council, which is likely to consider it at its meeting on 3-4 June. Ireland has supported this partial lifting of the EU ban on the export of products from the UK in line with the scientific advice to this effect.
Since the introduction of the EU prohibition on 27 March, a huge Garda and customs surveillance operation has been in place along the Border to ensure animals or products are not illegally imported into the State in contravention of the prohibition. This operation, which is undeniably necessary to ensure purchasers in markets overseas can continue to have confidence in Irish beef exports, has enabled Irish exporters to provide cast-iron gurantees as regards the origin of their exports. However, some seizures have been made during the course of the Garda operation, and I know all in this House will join me in condemning without reservation the small minority who appear to be willing to put at risk our entire beef industry.
As a major beef exporter, the Irish beef industry could not be insulated from the fallout of the BSE crisis. As the House is aware, the industry exports approximately 85 per cent of all cattle and beef produced in the country to a range of destinations both inside and outside the EU. One of the most immediate effects of the 20 March announcement was to raise serious concerns in the minds of consumers about the safety of beef and this led to a dramatic fall in beef consumption worldwide. It was evident from an early stage that this crisis was not going to be short lived and that it would creat major problems not just for the British beef industry but also for the European beef industry generally and especially in those member states such as Ireland with a heavy dependence on export markets.
It was for that reason that all of the services available to the State were marshalled with a view to assisting the Irish beef industry to cope with the crisis and minimise its effects. The Minister also directed his efforts to ensuring that the EU Commission, in the first instance, introduced effective market support arrangements to remove surplus beef from the market and, second, provided for compensation to be paid to producers who had suffered income losses as a result of the crisis. Any reasonable observer would agree that the Minister has been extremely successful in his efforts in regard to these objectives.
As far as effective market support arrangements are concerned, the EU Commission introduced emergency intervention measures early in April, subject to a ceiling of 50,000 tonnes on purchases into intervention under the two April tenders. When it became evident that these measures were inadequate, Commissioner Fischler responded to the Minister's request for more effective arrangements by temporarily lifting the 340 kg. weight limit on carcasses which may be sold into intervention and extending the scope of intervention to include grade 04 steers.
These adjustments significantly improved the effectiveness of the system to the extent that 40,000 tonnes of beef were removed from the European market under the second tender in April. The emergency intervention arrangements were extended into May subject to the reintroduction of a weight limit of 420 kg. on eligible carcasses. However, offers into intervention under the first tender in May showed that the 50,000 tonne ceiling for the month was too low and the Commission increased the ceiling to 65,000 tonnes. Approximately 40,000 tonnes was accepted into intervention under the first tender, leaving 25,000 tonnes available for the second tender, which will be adjudicated on at the meeting of the beef management committee on Friday, 31 May. This meeting of the management committee will also decide on the intervention arrangements for the month of June.
These intervention measures have been extremely successful in helping to eliminate the backlog of cattle which had built up on farms in the immediate aftermath of the onset of the crisis and in removing surplus beef from the market. The scale and depth of the crisis across Europe is evidenced by the quantities of beef offered into intervention, especially in Germany. Clearly, these emergency intervention measures prevented what would otherwise have been a total collapse in the European market, which would have had devastating consequences for the Irish beef sector. In this instance, intervention, for all of its faults, has been used very successfully to support the market.
The 12 per cent increase in export refunds on cattle and beef on 1 May was very welcome, as indeed was the positive response of the Irish beef industry to the increase. The volume of licences taken out in the days following the increase — 26,000 tonnes of beef and 5,000 head of live cattle — demonstrated a renewed confidence among Irish exporters in export possibilities on third country markets. I hope that this confidence is justified and that trade with third countries will return to something approaching normal levels in the near future.
Of course, effective intervention support arrangements and increased export refunds are only two of the instruments available to the Commission to support producers' incomes. I accept that, in spite of the intervention arrangements, cattle prices have fallen and producers have suffered substantial income losses as a result of the crisis. Indeed, it was recognised from an early stage that market support systems on their own would be unable to maintain cattle prices at levels which would return reasonable incomes for producers. This is highlighted by the fact that the Emergency Council on BSE on 1-3 April provided for the possibility of compensation being paid to producers. The meeting of the Agriculture Council on 29-30 April confirmed that compensation would be available and the council on 20-21 May discussed informal Commission proposals for compensation.
These proposals provided for increases in both the suckler cow and special beef premium at an overall cost of £540 million to the EU. At that meeting, the Minister, along with a number of Ministers from other member states, called for better targeting of the compensation at those producers who had suffered most from the crisis — in our case the winter fatteners. Commissioner Fischler has revised his proposals to take these views into account and I understand that they were formally adopted by the EU Commission this afternoon.
In summary, the revised proposals provide for an increase of almost £21 in the suckler cow premium and approximately £17.50 in the special beef premium at an overall cost to FEOGA of approximately £440 million. Overall, it should be worth approximately £52 million to Irish producers, which must be welcomed. A further £96 million will be allocated between member states to provide compensation to producers whose income difficulties were not fully addressed by the general increases in the premiums. Ireland would get approximately £8 million from the fund.
The revised compensation package is a significant improvement on the original proposals, specifically in that it provides for better targeting of the compensation. These proposals will, of course, be subject to negotiation in the EU Council of Ministers and will also require the opinion of the European Parliament. The Minister will be seeking to ensure that the final decision more adequately reflects the scale of losses incurred by farmers and that it is framed in a way that best suits Irish conditions.
All the evidence would suggest that this crisis is going to be more severe than any other crisis experienced by the beef sector in the recent past. While it may be too early yet to attempt to forecast how long it will last or how serious will be its effects, it is becoming increasingly evident that it will have a permanent and negative impact on beef consumption on our major markets. The Minister has been exerting pressure on the EU Commission to implement an enhanced beef promotion scheme to counter the inevitable negative publicity associated with BSE. I hope that the Commission will respond positively to this request.
However, we must consider the prospect that consumption will not return to a level which will enable the EU to live within the GATT ceiling on subsidised exports and that measures may be required at European level to restore balance to the beef market by reforming the beef regime. A debate on this issue is already underway, with some member states urging reform sooner rather than later. At this stage it would appear that some type of reform is inevitable and our objective will be to ensure in so far as we can that the premium arrangements continue to promote extensive production and that our share of the payments under the premium system is not reduced.
Turning more specifically to the market situation for Irish beef and beef products, I am pleased to note that following a swift and effective campaign by An Bord Bia, domestic consumption has returned to up to 90 per cent of pre 20 March levels, which is significant. Consumption in Europe, however, continues to be depressed and some markets are operating at 30 per cent to 50 per cent below pre crisis levels. In addition, many European and third country consumers are eating only nationally produced beef and so the market for Irish beef continues to be very difficult.
However, the Department and An Bord Bia continue to work assiduously to restore consumer confidence in Irish beef. Briefing documents outlining Irish beef and animal health controls and consumer information leaflets have been distributed widely. In addition, consumer advertising and promotion compaigns have taken place in targeted countries. I participated in a very successful campaign in Sweden while the Minister participated in campaigns in Italy and Spain and he has today completed a visit to Russia to promote Irish beef. The timing of such campaigns is crucial and further campaigns will be undertaken when market circumstances are favourable.
While only a small number of third countries imposed restriction on European beef products, this included some very important outlets for Irish beef, such as Iran and Libya, which still remain closed. I am pleased to report that Egypt, Kuwait, Lebanon and South Africa have lifted the restrictions on European beef and the reopening of all markets is a priority goal.
I stress that the issues raised by the recent BSE developments are mainly technical and are not amenable to instant political solutions. The Department, the diplomatic service and An Bord Bia have gone to great lengths to reassure the relevant authorities of the safety of Irish beef and beef products. High level delegations have visited Egypt and Iran, and a senior veterinary official has visited a number of Gulf states to discuss the technical issues raised by these countries. Political interventions have also been made where appropriate. As Senators will be aware, the Egyptian market reopened following the direct intervention of the Taoiseach, while ministerial contacts were influential in the reopening of the Lebanese market. The Minister proposes to visit Libya as soon as the necessary arrangements have been put in place. While he is disappointed that the visit has not taken place to date, it is important to ensure that the timing and circumstances are right so that the optimum outcome is achieved. Iran has agreed to send a veterinary delegation to Ireland and arrangements are being made to agree an early date for the visit.
I also welcome the announcement made yesterday that the livestock slaughterers and renderers have reached agreement on the commercial arrangements to be put in place for the continued collection and treatment of offal. The role of the Government in putting in place, as an emergency measure, a temporary scheme of direct financial assistance to the Irish rendering industry was intended to give all parties concerned sufficient time, and the chance, to reach agreement on those commercial arrangements. The scheme has ended and the bulk of payments under it have been made.
It is clear that the problems unleashed by the BSE crisis are farreaching and complex. However, I think all objective observers will accept that the Government has responded swiftly and decisively and that significant progress has been made on all fronts. The restoration of intervention has supported the market while a compensation package is under discussion which the Minister is determined will be sufficient and will target that section of the industry most affected by the crisis. The difficulties in the rendering industry have been resolved and some markets which had restricted European beef must be reopened. While serious problems remain and there is much work to be done, I think the House can be satisfied that the Government has acted in a concerted manner in the current crisis to safeguard the beef industry.
I think I have dealt with a number of the points raised by Senators. Senator Dardis referred to the resolution of the dispute between the livestock slaughtering plants and the renderers. I understand that all the slaughtering plants and renderers are now open, and contracts have been agreed between those plants and the renderers reflecting the commercial realities arising from the decreased value of the "fifth" quarter due to BSE developments. Details of those contracts are not available yet but no doubt producers will be quick to react if any undue financial burden arising from the contracts falls directly on them.
With regard to possible alternative uses for meat and bonemeal, whereas the rendering industry sees itself as continuing to have a commercial future, I can confirm that technical discussions are ongoing on possible alternative uses. These discussions involve both the ESB, Bord na Mona and other Departments.
Senator Kelleher referred to the role of the lending institutions. I can confirm that the Minister, Deputy Yates, has already met with those institutions and arrangements are in place to review the problems faced by farmers, and there will be further such discussions.
If I did not respond to what Senator Honan said, it would be unfair on officials in my Department. Her general comments were both unfortunate and misplaced. The misdemeanours of a single veterinary officer should not be an excuse to tarnish the reputation of the remaining staff who do a good job in difficult circumstances. I know from my dealings with them that they discharge their responsibilities in a professional manner.
It is also not true to say that the Department is solely concerned with protecting the interests of processors and producers. Clearly, the health of the consumer is a major concern of the Department. In fact, this is the ultimate objective of the veterinary health regulations enforced by my Department.
I thank Senator Honan and Senator Dardis for raising this important motion this evening. I agree with a number of speakers that, at this stage, it is time for national unity and a national response. All parties must support each other and come forward with suggestions, as Senator Dardis did this evening. It is an issue which we must all take on together, and I am confident that the Government will take the required actions to minimise the devastating effects which this crisis could have on the beef industry.
Thank you, a Chathaoirligh, for your flexibility on this matter. I know we started a little late, so I will be brief. I thank the Senators who have contributed and I am pleased that the motion is unopposed because it is of the utmost gravity.
I want to say on behalf of Senator Honan that her reflection on an official in the Department is valid; there have been other instances which I could quote. It is not a reflection on the totality of the civil servants in the Department but deficiencies have been found in the way the industry has been monitored and somebody, somewhere, must bear the responsibility for that, whether that be at a political or Civil Service level.
It must also be said that this is an issue the spin doctors, the programme managers and photo opportunities will do nothing to solve. We are down to the real nitty-gritty of realpolitik here, both at European and other levels, and that is what must be done. We must acknowledge that in the eyes of many consumers, even those nearest to the channel, Irish beef is British beef. It will take a major promotional campaign to counter that belief. In comparison to the money spent by multinationals, such as Nestle and Unilever, the amount the State spends on promotion is minimal. I suppose it derives from the beef intervention psychology which grew up in this country over many years with which we are only gradually coming to terms.
Border controls were mentioned. It is important that there should be such controls. I note the Minister, in a reply to a question in the Dail, mentioned that there had been 33 seizures and that the animals had been destroyed or a notice of destruction had been served in 19 of these cases. However, there was a worrying addition, which was that prosecutions for such illegal trade are hampered by the difficulty in determining the actual importer of the animals in many cases or by the fact that the importer resides outside the jurisdiction. Are we going down the same road here as with the growth promoters? If we are, it is very worrying. If there is a loophole it needs to be closed.
I sometimes think we are fast getting to the point where eating is bad for one's health. Unfortunately, many of our concerns derive from a situation where we have food in plenty and at a reasonable price. It is ironic that, at a time when we are commemorating the Famine, we find ourselves in such a position because food is so plentiful that minor deficiencies in it, and even major ones, become so important. That does not mean these deficiencies are not real, that the consumer does not make the decisions and that we must not market our products; of course we must.
I reiterate my appeal to the Minister to ensure that measures are introduced speedily, and I am encouraged by what he said:
All the evidence would suggest that this crisis is going to be more severe than any other crisis experienced by the beef sector in the recent past. While it may be too early yet to attempt to forecast how long it will last or how serious will be its effects, it is becoming increasingly evident that it will have a permanent and negative impact on beef consumption on our major markets.
That is an important and long overdue statement and I welcome it. It has been a reasoned debate and I am pleased the motion is unopposed.
Question put and agreed to.
When is it proposed to sit again?
At 10.30 a.m. tomorrow.