Select Committee on Agriculture, Food and the Marine díospóireacht -
Wednesday, 2 Feb 2022

Vote 30 - Agriculture, Food, and the Marine (Revised)

Chairman

No apologies have been received. Before we begin, members now have the option of being physically present in the committee room or may join the meeting via MS Teams from their Leinster House offices. Members may not participate in the meeting from outside the parliamentary precincts. However, it is important to note that in order to participate in a division in committee, members must be physically present in the committee room. If joining on MS Teams, I ask members to mute their microphones when not contributing and to use the raise hand function to indicate.

Members and all attendees are asked to exercise personal responsibility in protecting themselves and others from the risk of contracting Covid-19. They are strongly advised to practise good hand hygiene. Please do not move any chair from its current position. I urge all those present to maintain appropriate levels of social distancing during and after the meeting. Masks, preferably of a medical grade, should be worn at all times during the meeting, except when speaking. I ask for full co-operation in this.

Members are reminded of the long-standing parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to him, her or it identifiable.

This meeting has been convened to consider the 2022 Revised Estimates of Vote 30, Agriculture, Food and the Marine, which were referred by the Dáil to the committee on 15 December 2021. I welcome the Minister of Agriculture, Food and the Marine, Deputy McConalogue, and his officials. I note the Minister is accompanied by Dr. Kevin Smyth, assistant secretary; Ms Rebecca Chapman, principal officer; and Mr. Paul McNally, assistant principal. They are all very welcome to this meeting.

I invite the Minister to make his opening statement.

Minister for Agriculture, Food and the Marine (Deputy Charlie McConalogue)

I welcome the opportunity to present the Revised Estimates for 2022 to the committee. Budget 2022 was set with the ongoing challenges of Brexit and Covid in the background and in the transition between the current Common Agricultural Policy and the new CAP. The agriculture Vote for 2022 provides my Department with the resources to deal with these current challenges and opportunities across the various sectors in agriculture, food development, marine and forestry.

My sole focus as Minister for Agriculture, Food and the Marine is the protection and enhancement of the incomes of those who are the bedrock of the sector, namely, farmers, fishers and food producers and their families.

In a time of transition, farmers can have confidence that the budget protected farm family income and supported action to improve safety and sustainability on farms. We succeeded in protecting all the crucial farm schemes and the budget provision allowed us to provide additional funding for a number of policy priorities.

The resilience of the sector is demonstrated by the fact that exports of agrifood products in 2021 are estimated to be around €15.2 billion, an increase of almost €1 billion or 7% on the 2020 figure of €14.2 billion and a 70% increase on the €8.9 billion recorded in 2010. These figures include €1.7 billion in non-edible agrifood sector goods, including forestry and animal feedstuffs, which are not included in the Bord Bia food and drink figure of €13.5 billion. My Department and its agencies, in consultation with stakeholders, continues to monitor the impacts on the agrifood sector as the situation evolves, and to provide appropriate supports to the sector coming out of Brexit.

For 2022, the total Exchequer contribution to the Vote of my Department amounts to €1.891 billion. That is comprised of €1.574 billion in current expenditure and €317 million in capital expenditure. This figure represents a gross increase of approximately 4% or €65 million on the 2021 allocation and builds on the 11% increase on the allocation I secured in budget 2021.

It is anticipated that the Department will receive further funding from the Brexit adjustment reserve during 2022 through Supplementary Estimates, thereby giving the committee an opportunity to examine the proposals at that stage too. We are working closely with the Department of Public Expenditure and Reform in this regard.

When appropriations-in-aid are considered, the 2022 net Vote is estimated at €1.461 billion. This is arrived at by deducting the income we receive in appropriations-in-aid from our overall expenditure. The agriculture Vote is subdivided into four expenditure programmes corresponding to the four key strategic objectives set out in the current statement of strategy. I will now speak about each of these four programmes, A to D, and the key themes.

Programme A relates to food safety, animal and plant health and animal welfare. The total allocation for programme A in 2022 was €341 million, an increase of 6%. Irish farmers, fishers and agrifood companies produce world-class food that is known across the world. They produce products to the highest international standards of food safety and quality. Our food safety and traceability systems continue to be recognised as among the very best in the world. Regarding programme expenditure, I am continuing to fund vital services to ensure those standards are maintained, including the meat inspection service and the various supports provided by the Department testing laboratories.

The level of bovine tuberculosis in Ireland continues to be relatively low with progress being made during 2021 thanks to the new TB strategy I launched at the end of 2020. TB levels are lower than in the previous year for the first time since 2016. Enhanced actions to clear infection from herds experiencing extended breakdowns were initiated in June 2021. The goal is to eliminate TB infection from such herds to help them go clear as soon as possible and reduce the risk of repeat breakdowns. The TB forum, supported by Department officials, will continue, during 2022 and beyond, to implement the policy options outlined in the bovine TB eradication strategy. Our focus will be set on reducing disease year by year. The strategy is not set in stone. It is very much a roadmap and will be subject to revision on an ongoing basis in line with the trajectory of the disease. I have increased funding in the wildlife programme to help to further drive down TB rates this year and beyond. I have discussed with members the importance of this matter at meetings of the committee over the past year.

The programme for Government committed to a doubling of the ex gratia funding for animal welfare organisations within two years. Funding has been provided in 2022 to fulfil this commitment. Funding in programme A will also support the wind-down of fur farming operations in the State. I will be progressing Report Stage of that legislation in the Dáil later this evening.

Programme B relates to farm sector supports and controls. It is where the vast majority of our farm schemes are housed. A total of just over €939 million is available to programme B in 2022, to be paid almost exclusively to farm families. That is in addition to €1.2 billion funding from the European Union in respect of the various direct payment schemes.

Keeping farmers farming and assisting them in producing the world-class, safe and sustainable food they do is a key priority of mine. This support is also vital to farmers who deliver public goods and environmental benefits. As well as the inherent environmental benefits involved, this investment enhances our sustainability credentials, which are invaluable as we serve increasingly demanding and knowledgeable customers at home and around the world.

There are several key provisions in programme B in my Department’s Estimate for 2022. Conscious of the pressures on the tillage sector, I will allocate some €15 million of this sum specifically for that sector. This is an increase of €5 million on the outgoing year.

Beef and sheep farming is the lifeblood of many rural communities and helps ensure a balanced regional economy. The 2022 Estimate provides €104 million in targeted supports for livestock farming. I am providing more than €85 million to support sustainable beef farming. This includes over €40 million for the beef data and genomics programme, BDGP, during the transition period. It also includes over €44 million for the beef sector efficiency pilot, based on the BEEP-S scheme.

The sheep welfare scheme provides a valuable support to sheep farmers for undertaking actions which make a positive contribution to flock welfare. I was pleased to be able to secure additional funding for the scheme in budget 2022. This underlines my commitment to the sheep sector. The allocation for sheep welfare scheme has increased from its original allocation of €17 million in 2021 to €19.5 million in 2022 to cover the continuation of the scheme in 2022 and the change of reference year, leading to an increased number of sheep being able to avail of the scheme.

These measures, together with the allocation of more than €450 million for schemes such as the green, low-carbon, agri-environment scheme, GLAS, the results-based environment agri pilot, REAP, and areas of natural constraint, ANC, scheme will support livestock farmers to improve the economic and environmental performance of their herds while providing valuable income support for the sector. I am also providing €79 million, made up of €50.287 million in subhead B5, which includes a €29.9 million carryover, as well as €29 million in European Union recovery instrument, EURI, funding, including the capital carryover, for targeted agriculture modernisation schemes, TAMS, to support investment on farms and the continuation of the TAMS during the transitional period.

Turning to forestry, which I know is a priority of this committee, I am providing €100 million in support of the forestry sector. This provision is in recognition of the vital contribution it can make in mitigating climate change and supplementing farm incomes. In 2022, our aim is to increase the number of afforestation licences we issue. The overall output of licences increased by almost 60% from a low base in 2020. This demonstrates significant progress and we are determined to see that trajectory continue through this year.

Supplies of timber for the processing sector have thankfully stabilised over 2021. This time last year we were in a real crisis with supply. The backlog of forestry licence appeals, which had been a significant administrative burden and a delaying factor in many licence applications, is being dealt with, piece by piece and bit by bit, making progress each week and month.

In addition, an independent regulatory review of the forestry licensing system has been commissioned, a new system facilitating a pre-application engagement between the forester and the Department is being piloted and arrangements are being made to provide a financial contribution to applicants towards the cost of environmental reports. We will also publish a new forestry strategy for Ireland this year.

The carbon tax allocation has been reduced from €23 million in 2021 to €3 million for 2022. The programme for Government commitment provides for additional current funding of €1.5 billion of carbon tax funding for new schemes that will incentivise farmers to farm in a green and more sustainable way up to 2030. This funding will be additional to that provided for by the Common Agricultural Policy. This commitment is being met in full. It is intended to programme the carbon tax funding to enhance the new schemes proposed under the CAP strategic plan.

In the programme for Government the clear commitment was to direct the additional carbon tax funding specifically towards enhancing the environmental scheme in the CAP. Because the new CAP was delayed by two years and will not start until January 2023, I have reduced the profile of the carbon tax in 2022. The funding will be available to be pumped into the environmental scheme between 2023 and 2027. This is being true to the programme for Government commitment on expenditure of the carbon tax. This will allow funding to be programmed into the CAP strategic plan, ensuring compliance with agriculture state-aid rules and with a view to securing Commission approval for the interventions proposed in the CAP strategic plan. We will see a coherent green architecture in CAP strategic plan that will run from 2023 to 2027.

Programme C deals with policy and strategy. The total allocation for programme C is almost €403 million. Many of the programme C allocations reflect the comprehensive approach to Brexit responsiveness. Access to finance is crucial for business needs and is a key part of the Government’s response to the challenges posed by Brexit. In addition to liaising with the main banks on issues relating to the agrifood sector, my Department and I work closely with the Tánaiste and Minister for Enterprise, Trade and Employment and his Department, as well as with the Minister for Finance, Deputy Donohoe, and his Department. The Estimates for 2022 will provide for ongoing access to the loan schemes through the Strategic Banking Corporation of Ireland for farmers, fishers and food and drink SMEs.

To support our food industry a provision of €7 million has been made for this year through the Enterprise Ireland capital investment scheme. This is to support the meat and dairy sectors investing in greater product and market diversification. We will support Irish research and innovation activity to enable the sector to innovate and deliver greater efficiency and economic, environmental and social sustainability.

In 2022, for the first time, there is a dedicated budget for farm safety of €2 million. I recognise the ongoing work of the Minister of State, Deputy Heydon, in making real progress in this area. This new funding will play a significant role in achieving cultural change around safety on our farms. They are working environments and we must continue to work together to make them safer. Reductions in the rate of fatal and serious incidents on farms will happen only by changing behaviours, increasing awareness, training, and investment in key farm safety and in farmer mental health and well-being measures. The €2 million allocation is in addition to the continued funding for farm safety equipment under TAMS, a recently launched accelerated capital allowances for farm safety equipment scheme, and a range of locally-led schemes focused on farm health, safety, and well-being projects.

In recent budgets increased funding has been provided to Bord Bia to strengthen its understanding of consumer priorities and preferences in Ireland and in distant markets and to communicate these insights to Irish food companies for use in product promotion, development, branding and marketing. The Bord Bia grant is €53 million in the 2022 Estimate.

Teagasc’s capital allocation has been increased by €3.85 million to €10.45 million. With this funding Teagasc proposes to establish the national agricultural sustainability research and innovation centre at Johnstown Castle. This is a strategically important project to support strategic national commitments to increase the sustainability of our agricultural and food systems. The project has been in gestation for some time due to funding requirements. I was pleased to secure €9 million in Exchequer grant aid towards the construction costs from the Department’s capital budget on a phased basis to 2024. The allocation this year is €3 million. This funding represents a strong commitment by the Government to provide farmers and other stakeholders with access to practical solutions to improve soil health, restore and protect biodiversity, improve water quality, reduce emissions of greenhouse gases and ammonia, and enhance soil carbon sequestration.

I was very glad to be able to visit Johnstown Castle prior to Christmas to turn the sod on the new research and innovation centre and officially open the newly revamped Johnstown Castle. It is now opened to the public. It was my first time there and anyone in the area should visit it. It is a tremendous castle that has been well restored. It is well worth a visit. It is on the same grounds as the existing facilities and the new national agricultural sustainability research and innovation centre. Johnstown Castle is where much of the research was done to verify the emissions reduction potential of low-emission slurry spreading, which enabled us to programme the gains we are getting from it into our national inventory to reduce our overall emissions. It is a real-life example of the work that has been going on there. The new innovation centre will help to drive this forward and will be very important in the coming decade.

The allocation to the horse and greyhound racing fund is €89.7 million. This is a reduction of €7.8 million when compared with last year's allocation. As we welcome back spectators to both sports the fund’s 2022 budget allocation is appropriate.

Programme D deals with the seafood sector. The provision for the Department’s seafood programme has been increased by 17% to a total of €207 million for the continued promotion of the environmentally sustainable development of our fisheries sector, aquaculture and wider seafood industry. This sector supports some 16,000 direct and indirect jobs almost exclusively in coastal communities. The provision will help fund vital investment in our fishery harbours, most particularly in Killybegs, Howth and Castletownbere. I also announced significant investment of €25 million for a new deep water harbour in Rossaveel.

The budget allocation for the Sea-Fisheries Protection Authority, SFPA, in 2022 will allow it to continue to meet its national and EU obligations as Ireland’s competent authority for the enforcement of sea fisheries and seafood safety law, and to meet challenges coming from Brexit. The core areas of the SFPA include the costs associated with certifying seafood in food business premises throughout the country and providing 24-7 inspection services at the main fishery harbour centres and numerous secondary ports around the coast.

In response to the impacts of the trade and co-operation agreement I established a seafood task force in March 2021 to examine these impacts and make recommendations on appropriate measures to mitigate them. The Navigating Change report of the seafood task force recommends 16 support schemes with an estimated cost of €423 million to assist the seafood sector and coastal communities to mitigate the impacts of the trade and co-operation agreement, including temporary and permanent cessation schemes for the fishing sector, capital investment schemes for seafood processing and aquaculture, marketing supports, marine infrastructure renewal, enhanced community-led local development through the seven fisheries local action groups, and liquidity support for co-operatives and processors.

Most of the schemes recommended by the task force are proposed to be funded in 2022 and 2023 under the EU Brexit adjustment reserve. An amount of €31.5 million has been allocated to Bord Iascaigh Mhara in this year's Estimate to manage schemes that are approved under the Brexit adjustment reserve along with its other normal important work.

The recommendations of the task force are being urgently examined and assessed across government with regard to available funds, eligibility under the Brexit adjustment reserve, state aid and the public spending code. A Brexit temporary fleet tie-up scheme recommended by the task force was implemented in 2021 and provided supports to vessels in the polyvalent and beam trawl segments to temporarily cease fishing activity in a particular calendar month, thus increasing the quota available for remaining vessels that were fishing. The scheme had a total of 229 applicants of which 179 were successful. The cost of the scheme was approximately €10 million. The task force has recommended a second temporary fleet tie-up scheme for 2022 and I am considering that.

In January I announced a Brexit inshore fisheries business model adjustment scheme to provide support to assist inshore fishers in adjusting their business model to the post-Brexit market environment. As recommended by the task force, one-off payments of €2,700 are available to owners of vessels under 8 m in length and €4,000 for owners of vessels between 8 m and 18 m in length. That scheme has a total budget of €3.7 million. The Brexit adjustment reserve funding is an initial allocation for 2022 and I will be announcing other schemes in the coming weeks and months. These will be rolled out on a phased and prioritised basis as recommended by the task force.

This is a comprehensive, if not especially brief, overview of some of the key issues and the range of measures that apply in the agrifood and marine sectors for this year. I am satisfied that the 2022 allocation, together with the supports to be provided under the Brexit adjustment reserve, will provide a good, balanced package of measures for farmers, fishers, coastal communities and the food sector. I look forward to taking questions on specific areas and further developing some of the key points on which I have given an overview.

Chairman

I thank the Minister. Before opening the discussion to members, I will ask one or two questions. While I welcome the significant funding for TAMS, as we all know, building costs have increased beyond all recognition in the past six months. The €80,000 ceiling in place for farmer investment in TAMS has become inadequate. Will the Minister review that ceiling? Any construction work on farms now quickly exceeds that ceiling. Changing the ceiling will have an impact and extra funding will be needed. If TAMS is to maintain relevance for farmers in the context of increased costs, the ceiling for TAMS has to be looked at. Costings were examined late last year and have been revised. With the cost of raw materials now, the ceiling definitely needs to be revised.

On TB, I welcome the increased focus on wildlife. We can see the results of that. As the Minister said, we have seen a reduction in the number of reactors for the first time since 2015. Is that completely focused on badgers? Are resources being put into controlling the deer population?

Will the Minister provide a breakdown of the €53 million allocated to Bord Bia? Where will that money be spent and how has it been allocated? If that detail is not available today, I ask the Minister to revert to the committee with an answer.

Deputy Charlie McConalogue

The point on TAMS is very relevant. I have completed and implemented a review of the costings and another review is ongoing. I also announced my intention to increase the ceiling from €80,000 to €90,000 as part of the next CAP. I acknowledge the Chairman's point in regard to the pressure on costs over the past year. I will consider the matter further, taking on board the feedback of the Chair and of some colleagues. It is an issue on which the Chair has spoken to me previously. It is a valid point and one I will reflect on further.

In regard to TB we had a few very challenging years when the figures were going in the wrong direction. It was important that we came together in order to try to put a new strategy in place. I was grateful for the support of all key stakeholders last year to get agreement on a new TB strategy. The new strategy implementation group and its three working groups are up and running and making good progress. All the stakeholders are working well and, for the first time in several years, that is leading to a reduction in reactor rates.

Overall funding for the wildlife unit is significant, particularly for badger vaccination for which funding is increasing from €1.9 million in 2021 to €2.1 million this year. This is a key focus in managing the wildlife impacts. Another important issue is providing targeted resources for advisory staff working with farmers, which has been a challenge, providing increased time, assistance and advice to manage the risks at farm level and ensuring that reactors are removed promptly.

One issue I did not cover in my initial contribution, on which members will be keen for an update, is the removal of the derogation for burning of bushes and scrub. I have engaged with the Minister for the Environment, Climate and Communications, Deputy Ryan, over the last few days on the issues and challenges for the farming community on that issue. I am glad to report that the Minister will provide a derogation for farmers,to enable them to burn scrub. We will engage in terms of looking at future options and alternatives that may be possible in the years ahead. This is an important management tool and I am grateful to the Minister for recognising the importance of providing a derogation and ensuring it is available for farmers, outside of the nesting season of course. It is an important facility for farmers, one which they use in a balanced way. I know the Chair is interested in this matter and Senator Paul Daly also brought it to my attention. I am happy to update the committee on progress in that regard.

Chairman

It is good to see common sense prevail.

Deputy Michael Fitzmaurice

I thank the Minister for coming in. Similar to the Chair, I welcome the common sense being brought to bear on this issue and the Minister's intervention. I note the allocation for administration has increased by between 25% and 30%. Will the Minister explain that?

Deputy Charlie McConalogue

What specifically is the Deputy looking at?

Deputy Michael Fitzmaurice

I was looking at administration costs. Is the increase due to new schemes coming in?

Deputy Charlie McConalogue

Travel and subsistence costs are up from €5.7 million to €8.3 million. The figure for training and development incidental expenses is up from €6.4 million to €9.1 million. That reflects the impact of Covid-19 on activity in 2021 and the expectation that there will be a return to more normal business over the course of this year. Laboratory services-----

Deputy Michael Fitzmaurice

Administration non-pay costs increased by 43%. That is the figure I am trying to fathom. It is in table 4 of programme B.

Deputy Charlie McConalogue

For each of the programmes, A, B, C and D, there is a formula used as to how administration expenses are allocated. They are allocated on a percentage basis for each of the programmes. It is therefore not necessarily directly related to the programme; it is a reflection of the overall administration costs. For anyone who wishes to see what exactly is happening in administration and where the costs are before they are then allocated to the four programmes, there is a separate table here that breaks down the administration costs and where they might be up or down and the subhead within administration to which that is attached.

Deputy Michael Fitzmaurice

I am looking at the overall budgets and farmer participation numbers. Is it not regrettable that there were nearly 49,000 farmers in GLAS in 2020 but that we will now see about 41,650, which will be, to put it simply, 8,000 fewer farmers in an environmental scheme?

Deputy Charlie McConalogue

Yes, it is, but that is a choice farmers made. Obviously-----

Deputy Michael Fitzmaurice

Where is the opportunity to avail of the scheme, though? How would someone who came out of GLAS last year get into a new scheme for 2022?

Deputy Charlie McConalogue

I rolled over GLAS, so any farmer coming out of GLAS was able to opt to do an extension year.

Deputy Michael Fitzmaurice

What is the reason we have 7,000 fewer farmers participating?

Deputy Charlie McConalogue

I am not sure what the various reasons might be. Every farmer's reason will be different. We had the REAP as well, but that was for farmers not currently in GLAS. There was a very successful uptake of that, which shows, even for those who are outside of GLAS, the appetite that is there to come into a scheme. My approach to GLAS was to try to make sure that, while we were in the two transition years, it would be as practicable and hassle-free as possible for farmers to roll over their GLAS participation and to continue it. We saw 42,000 of the 49,000 who had completed five years roll over their participation and avail of the extra second year, which will, I hope, be there next year to-----

Deputy Michael Fitzmaurice

Is 17% or 18% not a huge drop-off?

Deputy Charlie McConalogue

Yes, but there is nothing more we could do to affect that other than to make it as practicable as possible for farmers to continue. We could not do a new scheme for them. It would be much more practical for those who were in GLAS, for example, to continue on GLAS and to continue with the measures they had than it would be to do a new scheme. I do not think doing a new scheme would necessarily have continued to capture those 7,000 farmers. Maybe some are retiring. I imagine there are a myriad of reasons-----

Deputy Michael Fitzmaurice

Is it not that GLAS is very restrictive in that if you were out of land you had leased, it was a problem, and that the opportunity was not there to get the land to re-lease or whatever and it-----

Deputy Charlie McConalogue

That is less of a challenge for a one-year scheme than for a five-year scheme. Farmers only had to opt to extend it for one year. The approach taken was to try to maximise the opportunity for as many farmers as possible.

Deputy Michael Fitzmaurice

I am looking at the number of hectares in forestry. I cannot believe my eyes. I see 2,434 ha for 2020. I see 8,000 ha for 2021 and 8,000 ha for 2022. We did not reach 8,000 ha in 2021. We keep persisting with these figures year in, year out. Is it not a false figure for 2021 and an aspirational figure for 2022?

Deputy Charlie McConalogue

Without a doubt, we did not plant as much forestry last year as we would have liked to have seen. The committee is well aware, because this is something on which it has put a very strong focus, of the challenges we had with licensing and which, over the course of the past year, we have been working our way out of. Thankfully, we are gathering momentum and making a real impact and we will see real, significant progress on that over the course of this year. We had maybe 500-odd - I am trying to find the figure here - afforestation licences last year. That equated to about 8,000 ha. There was-----

Deputy Michael Fitzmaurice

Afforestation licences. No.

Deputy Charlie McConalogue

About 550 afforestation licences were granted.

Deputy Michael Fitzmaurice

We are at 4,000 ha, or we said we would reach-----

Deputy Charlie McConalogue

The actual amount planted was 2,400 ha.

Deputy Michael Fitzmaurice

Yes, but about 4,000 ha worth was given out in licences. I am worried. I have looked at the figures for this year to date. While I acknowledge that the number of licences for felling has improved, on the planting side of it I have looked up the figures for January and February so far and it is backwards we are certain to go again. That is what I worry about.

Deputy Charlie McConalogue

As for afforestation, every felling licence that is granted comes with a reforestation licence. Where somebody clear-fells a site, the obligation is on him or her to replant that within two years. A new afforestation licence is valid for three years. The licensee has to plant the site within three years. Last year's output of afforestation licences was not as successful as, for example, the progress that was made on felling. That will be a focus this year. Our objective will be to double the number of afforestation licences issued this year. The number of afforestation licences granted last year was 500-odd but, in land area terms, that was just over the 8,000 ha mark. We have seen about a 60% uptake of licences that are granted reaching afforestation. Our objective is to make progress towards 8,000 ha. We are making a profile for that and we will continue to do that because it shows our commitment to funding that. At the end of last year, in October, when it became clear what the level of afforestation was last year, in the October Revised Estimate I reprofiled the funding it looked like we were not going to spend in that regard. At the start of this year, we are putting in place funding that would cover 8,000 ha. There will be a significant effort in the Department this year to address afforestation licensing and make real progress on it.

Deputy Michael Fitzmaurice

The Minister talked about the sheep welfare scheme. The Department has made changes to it, and I welcome the new dates. What was the outlay for the sheep welfare scheme? In my understanding, in 2016 or 2017 either €20 million or €25 million was laid out for it. Is that correct?

Deputy Charlie McConalogue

Yes. It was €25 million initially.

Deputy Michael Fitzmaurice

What is it now?

Deputy Charlie McConalogue

I have increased it this year. I think it is €19.5 million in 2022-----

Deputy Michael Fitzmaurice

It has gone down in total since that time.

Deputy Charlie McConalogue

No. It is less than what it was projected to be back in 2016 and 2017. What was projected at that stage was potentially up to €25 million. That was then subject to demand, so I think the level of uptake was €16 million or €17 million. As with all the other schemes that are in place and the outgoing CAP, until we have entered the new CAP in 2023, the only option available to us is to look to roll over those schemes. It is not a requirement of us but it is something I have wanted to do. Therefore, I have rolled over the sheep welfare scheme too but updated the reference year in a way that seeks to maximise the number of sheep that qualify. Updating that reference year means that more payments will be made in respect of sheep this year. The reason I have increased the budget is to facilitate those extra payments. As the Deputy will be aware, under the new CAP, the €10 payment is due to increase to €12. As he will know, many sheep farmers would like that to be more, but that is what we are doing.

Deputy Michael Fitzmaurice

Bringing the debate back to the issue of forestry, unless the dashboard I am reading is wrong, 4,255 ha worth of licences was given out in 2019. In 2020 the figure was 4,342 ha, in 2021 it was 4,255 ha and it is 505 ha so far this year.

The Minister said the figure was 8,000 ha.

Deputy Charlie McConalogue

There were 505 afforestation licences-----

Deputy Michael Fitzmaurice

So far this year, 505 have been given out but last year the Minister said the number of hectares was 8,000.

Deputy Charlie McConalogue

Yes.

Deputy Michael Fitzmaurice

Unless we are getting a wrong dashboard, 4,255 ha was the total for the year and the year before that the figure was 4,342 ha. That is what the dashboard tells us on hectares, and then it shows figures for kilometres and licences issued. What I am reading is that afforested hectares for 2021 come to 4,225, rather than the 8,000 ha the Minister is saying.

Deputy Charlie McConalogue

Yes, that is what is indicated by what the Deputy has there. I was working from memory of a briefing I had in the last couple of days, which was to the effect that the 550 licences amounted to just over 8,000 ha. That table clearly indicates the figures the Deputy has given.

Deputy Michael Fitzmaurice

It is about half what the Department has down for 2021.

Deputy Charlie McConalogue

Yes. The 8,000 ha is our target. Our plan for 2022 is to double the number of afforestation licences issued. At the start of the year, given our level of ambition, we are profiling the level of funding that would meet that ambition. As the year evolves, we will closely monitor and, depending on the drawdown, adjust it.

Deputy Michael Fitzmaurice

The money is the money that is laid out. We will not change it here. No matter what we do, it will be the same. There is no point in holding the Minister all night.

We got a few phone calls in recent days from people about slurry. Next year, from what I can see, most farmers will need to be using the low emission slurry spreading system, LESS, going by the nitrate regulations and all that. I was looking at gear and what it costs. It costs between €50,000 and €80,000 to get the gear in. If the Minister does not talk to the contractors or the Association of Farm and Forestry Contractors in Ireland, FCI, there could be a problem in many areas. That is my opinion having talked to farmers in different areas.

On TB, there seems to be a question, debate or disagreement between different groups about who pays for what test. Is that issue resolved? It is important that there is an agreement on that.

Am I right in saying the 2022 target budget for EU direct payments, which I was looking at here, is something like €28 million less than it was in 2021? It has gone from €1.19 billion to €1.162 billion. Maybe I am-----

Deputy Charlie McConalogue

Is the Deputy talking about TAMS?

Deputy Michael Fitzmaurice

No, I am talking about different things. The last one was EU direct payments, which is also the final area covered in the Minister's presentation. There is €28 million of a deficit. Am I right in that?

The other area I talked about was slurry. They are straightforward issues.

Chairman

I support Deputy Fitzmaurice. Agricultural contractors will spread the vast majority of the slurry around the country. The machinery being acquired now is expensive. We had them in with us last week, I believe.

Deputy Michael Fitzmaurice

Yes.

Chairman

They made a strong case to be made eligible for TAMS.

Deputy Charlie McConalogue

Okay. The Deputy is correct on those figures. Do we have an answer as to that €28 million difference in the output targets for 2021 and 2022? We will check that. The 2020 outturn is the same as the 2022 output target. 2021 was the first year of the new seven-year programme; 2022 will be the second year of it. There was an adjustment in the basic payment-----

Deputy Michael Fitzmaurice

Would it be because of Brexit or anything?

Deputy Charlie McConalogue

I do not think so. It is basic payments and greening so there would be a slight reduction in overall Pillar 1 as we move from the previous seven-year period, which ran from 2014 to the end of 2020. There was a small 1% to 2% drop in Pillar 1 payments at the start of 2021. That will stay constant until the start of 2027. Pilar 2 went up but Pillar 1 dropped slightly. That adjustment happened for 2021. I am not sure of the reason for the difference but I will check it. We would expect the 2022 figure for basic payments to be the same as 2021.

Deputy Michael Fitzmaurice

Okay. Will the Minister look into the slurry issue? I can see a problem. I am a contractor. The bit I do will not change Ireland but I am talking about the number of farmers ringing at the moment who are not familiar with what they have to do this year and next. On Sunday evening, two of them rang me wondering what they have to spread with this year. Next year, they have to look at whether they are under 100 or over that. Does the Minister understand me? Most of them will be on the LESS system over 100. Many contractors would be just splash plate at the moment and will not be going down that road for the amount of work they are doing, unless some bit of help is given. This is not about subsidising; it is about the environment that is being played to make sure we reduce emissions.

Deputy Charlie McConalogue

Great progress has been made in the last two, three or four years on the uptake of LESS. We have 3,500 LESS spreaders and machines in the country and there has been about €100 million of drawdown from TAMS to support that. I take the point the Deputy is making. From my recollection, under the CAP there is a restriction on business or contractors being able to avail of it as opposed to-----

Deputy Michael Fitzmaurice

From my recollection and from what the FCI put to us last week, other countries were able to get around it under the rural development plan. I ask the Minister to look at the issue.

Deputy Charlie McConalogue

I will look at it further. I understand where the Deputy is coming from. We have to push on and try to assist that transition. The Deputy is right that much of the slurry will be spread by contractors. They will play an important role and we want as much use of LESS as possible because it makes financial sense from a farmer's point of view every year, this year more than ever. It makes sense from an emissions point of view as well.

Deputy Martin Browne

I thank the Minister for coming. Under programme A, it is noted that the number of import controls will fall to 75,000 in 2022, down from pre-Brexit estimates of 500,000. Is the Minister or the Department doing any forecasting on how this will pan out in subsequent years? Have the staff who were performing these tasks beforehand been reassigned?

Deputy Charlie McConalogue

Will the Deputy repeat what he said on the-----

Deputy Martin Browne

The number of import controls will fall to 75,000 in 2022, down from pre-Brexit estimates of 500,000. Is the Department doing any forecasting on how that will pan out?

Deputy Charlie McConalogue

It was a projection at the outset on the expected level of demand. What we are now projecting for next year is representative of what we feel is likely to be the demand. For the number of consignments of live animals and products inspected at border inspection posts, 75,000 is projected for next year. We had projected for last year that it might be up to 500,000. It has been less than that but we are looking to match the level of inspections with demand based on what we have seen over the last year, which was the first year of Brexit.

Deputy Martin Browne

In programme B, the number of applicants under the organic farm scheme was 1,570 in 2020 and the target for 2021 was 1,800 and is the same for this year. Do we know what the figure was for 2021? Is the 2030 target a realistic one and what is that based on?

Deputy Charlie McConalogue

We have been working hard to try to improve the uptake of organics and the appetite has been increasing among farmers for the organic scheme. In terms of the next CAP programme, we have increased the funding for organics fivefold. It is something we intend to drive on very significantly at Government level and to make real progress on over the next years. The message I have for many farmers is to consider how suitable organics would be for them and how much would be involved for them to go organic, and to look in particular at how their income could be improved for those who take up that option. With regard to the projection for next year, the output target for last year was 1,880 and we are hoping to increase that by about 400 to 2,230 this year. That is certainly doable. We have the funding in place to do it and we will certainly be getting the message out there to farmers to apply.

Deputy Martin Browne

I hate to come back to forestry again because we are blue in the face talking about it. The Minister says he is putting in the funding to reach the target of 8,000 ha but we will not reach it, no matter what spin the Minister puts on it. We need to be honest with the public at this stage and tell them we are not going to reach this. Does the Minister have confidence that we will reach that figure? I know he is saying he is putting in the funding, which is welcome across the board and nobody will give out about that. However, despite putting in the funding to reach that 8,000 ha target we keep talking about, and about which this committee keeps putting out messages to the sector, it is not going to be reached.

Deputy Charlie McConalogue

I have confidence that we will reach it, if not necessarily this year. We need to do everything we can to get there. It is very important for our climate change targets, for farmers’ income diversification and for providing raw materials to displace other more carbon intensive materials, for example, in the building industry. We will get there and we have to drive on as hard as we possibly can. It is unlikely we will make that jump this year. I am profiling the funding that will be available to do it but we would all agree it is unlikely we will get to that target over the course of this year. I will monitor it closely. We are making progress in regard to licensing and we are in a much different place from where we were this time last year. There is still a lot of work to do but we are gathering momentum all of the time. As it moves towards the end of the year, in assessing where we are at, I will then look at the spending profile. Certainly, at the start of the year, there is a clear indication of our intent and willingness to fund this, and I am profiling the funding that will be required to meet our target.

Deputy Martin Browne

Will the Minister comment on claims made by the Minister of State, Senator Pippa Hackett, in a recent press release that the backlog of forestry licence appeals has been dealt with? That is clearly not the case. I note the Minister copied the same line in his opening statement. From what we know at the moment, the backlog alone will take until October to clear and there is nothing new coming into the sector. If we are going to take until October just to clear the backlog, how many more licences are going to come in after that?

Deputy Charlie McConalogue

We are dealing with it. Although it has not been dealt with or completed yet, we are making progress on it every month. Members know, as I do, that this time last year there was a real crisis in the sector. Sawmills that would normally have sourced their logs from Irish forest were not able to get those logs and sawmills that did not want to import logs were importing. Thankfully, we are no longer in that situation and we now have wood flowing freely through the system. In any given year, imports of logs are always dwarfed by exports because the vast majority of the timber we produce in Ireland is exported, although we import timber for some purposes. We are back at that equilibrium that we have been at in terms of supply, in particular the supply to the sawmills.

Prices have gone up in line with international prices and it is not a supply issue at Irish level because we have more than enough supply in the system. The challenge is obviously around licensing in terms of getting through the licence applications that are there. Real progress has been made and, over the course of this year, significant further progress will eat into that backlog. Thankfully, we have moved gradually over the course of the last year to a situation where we are issuing more licences in a week than the number of applications received. We have tipped that balance and, over the course of this year, we will be issuing significantly more licences than applications received and eating into that backlog. Through the regulatory review that is ongoing, we are looking to see where and how we could possibly make the system leaner to give even greater capacity to issue more licences. We are going in the right direction and we will continue to make progress month by month over the next year.

As Deputy Fitzmaurice pointed out, afforestation will be a significant priority this year for the Department and we seek to double the level of afforestation licences issued. Over last year, we made massive progress in dealing with the appeals backlog, for example. All of the committee members co-operated in December 2020 in facilitating a change to legislation to streamline the appeals system. At that stage, we had 1,000 applications backlogged in appeals, as well as the challenge in regard to straightforward licensing. That is now down to ten or 20 files in the appeals system compared with 1,000 some 13 or 14 months ago. Again, that has been a significant help and has provided certainty around the pipeline so the appeals did not become a blockage as well. That is a reflection of the progress that has been made.

When we come from such a challenging position as we were in this time last year, we do not flick a switch and get to where we want to be overnight. Thankfully, I can report that we are making progress week by week and month by month. We are on the right pathway and it is one that will deliver more and more progress and gradually clear that backlog. The backlog of applications has reduced by approximately 1,300 over the course of the last year. We want to get to a stage where we have the normal equilibrium of files in the system, potentially around 2,000 files at any one time going through the various stages of the process.

I acknowledge the tremendous work that the Minister of State, Senator Hackett, has done in leading out and turning the corner. It was a challenge she faced when she was appointed. The crisis was coming to its most acute point, and a lot of work had to be done to move it forward. It was also very challenging for the team of officials in the Department, as well as for everyone working in the industry, to gradually work our way out of it.

We are on that pathway now. We have to start changing the narrative because we are at the stage where we are able to process and issue significantly more than we are receiving, which is driving down the backlog. We now want to get the message out to people that we want more licence applications and we want people to look at forestry in a positive way. While we have further road to go in dealing with the challenge, we are on that road and that should bring confidence back to the system and enable us to change the narrative. It is still challenging but we are on the pathway.

Deputy Martin Browne

The Minister has answered my next question as I was going to ask him for a prediction on the afforestation licences. He is saying the figure will double over the next 12 months or so. We will hold him to that.

Given the value of total seafood sales and exports have continued to drop, what is the Minister's forecast for this year and going forward?

Deputy Charlie McConalogue

Is that for total seafood sales?

Deputy Martin Browne

The exports have continued to drop. What is the Minister's forecast for the period ahead? If he does not have that information, he can come back to me.

Deputy Charlie McConalogue

The figure for 2020 is just under €1 billion. The figure for 2019 is slightly higher but I do not have it to hand. The financial provision we are providing in the Estimates this year as an investment in the seafood sector is significantly higher across most programmes, whether capital or current.

Deputy Martin Browne

The dispute on the Northern Ireland protocol has escalated. The Minister of Agriculture, Environment and Rural Affairs in Northern Ireland, Mr. Edwin Poots, has ordered that agrifood checks on the Irish sea border cease at midnight tonight. I ask the Minister to comment.

Chairman

The Minister is here to discuss the Estimates. I would not expect him to answer the Deputy's question.

Deputy Martin Browne

I appreciate that and thank the Minister.

Deputy Michael Fitzmaurice

It was remiss of me earlier not to point out that the former Deputy, Noel Treacy, who passed away earlier today, represented part of my constituency. He was a member of the Chairman's party at one time. I send my condolences to his family and I also extend my condolences to the Kitt family on the death of Mrs. Kitt.

Chairman

We would all like to be associated with the expressions of condolences.

Deputy Charlie McConalogue

I echo the expressions of condolences. Former Deputy Noel Treacy was a very fine public representative and man. He was a former Minister of State at the Department of Agriculture and Food. I pass on my condolences to all of his family and the family of the late Mrs. Kitt.

Deputy Martin Browne

I wish to be associated with the expressions of sympathy. I also extend condolences to Senator Buttimer on the death of his father who passed away earlier today.

Chairman

On behalf of the committee, I extend my condolences to Senator Buttimer.

Deputy Matt Carthy

I would like to be associated with the expressions of sympathy to the family of Noel Treacy, and also to Senator Buttimer on his loss. I apologise for attending online. I am trying to balance attendance at two meetings at once.

I thank the Minister for his attendance and his opening remarks. I will try not to repeat questions that have already been asked and I will try to ask my questions as quickly as possible. On programme A, there has been a dramatic increase in what are described as other controls and the number of phytosanitary certificates. Is that as a result of Brexit? What exactly do those controls involve?

Deputy Charlie McConalogue

Yes, Brexit has been a key driver of many of the transport controls. To which specific controls is the Deputy referring?

Deputy Matt Carthy

I refer to the number of phytosanitary certificates to issue. The 2020 outturn was 1,030, the 2021 output target was 13,050 and I see the 2022 output target is 2,400.

Deputy Charlie McConalogue

Yes, Brexit is the reason. Since Brexit, there has been a significant increase in demand for a number of certifications, health certifications and phytosanitary controls. When we put together the 2020 output target we worked off estimates of what the impacts from Brexit might be. We have a much better line of sight now, having gone through a year of the post-Brexit situation, of actual demand and level. The number has been adjusted to reflect the experience of the past year.

Deputy Matt Carthy

The issue of veterinary alignment has been kicked down the road until the end of the year. Does that output target represent both the deal and no-deal scenarios, to use those terms again?

Deputy Charlie McConalogue

It does. We have import requirements under which certification is required for goods coming into the EU. We must manage those at our border entry points. The other challenge is when certification in respect of exports to the UK will commence. Two or three times in 2021, deadlines that had been set were then moved out. They have moved out again into this year. Our figures are based on our best estimate. The Department has contingency plans for how things will be actioned when this happens. We have already put in place many staff who will cover these tasks and requirements. We are making an estimate at this stage based on the current projection.

Deputy Matt Carthy

In the case of a no deal on veterinary alignment, my understanding is that every consignment would then require the presence of a departmental vet. As the Minister will know, many larger companies operate 24-hours a day, seven days a week. Does the Department have the staff and resources in its allocation to meet those requirements?

Deputy Charlie McConalogue

Yes, we do. We have put a lot of preparation into being ready for that. There has been significant engagement with food business operators on what their needs will be and in trying to give line of sight of the arrangements that will be in place when the new import controls come in. We have had time to reassign staff because of the delays and there are other staff who would be in a position to take on those duties and responsibilities. As such, I am confident that we have the capacity to provide that service. Importantly, we will continue the engagement at individual food operator level on their particular needs and how models can be adjusted to work well when these controls inevitably come in.

Deputy Matt Carthy

On Brexit, I am sure the Minister has been made aware that his counterpart in the Northern Executive, Edwin Poots, has ordered a halt to Brexit agrifood checks at Northern ports from midnight. Does that concern the Minister? Does he have a view on the implications that will have for the agrifood sector?

Chairman

I stopped Deputy Browne when he raised this matter a few minutes ago, so I had better be consistent. We are here to discuss the Estimates so I urge the Deputy to stick to the Estimates.

Deputy Matt Carthy

It in the context of the Estimates that I ask my question.

Chairman

No.

Deputy Charlie McConalogue

I am happy to make a short comment.

Deputy Matt Carthy

The decision will have implications for the resources we put in place for these inspections.

Chairman

The Minister has said he will comment.

Deputy Charlie McConalogue

I will make a short comment. Obviously the Northern Ireland protocol is important and essential to the flow of goods from north to south and east to west. It is important that diplomatic efforts continue to ensure it works well. I will continue to do all I can to work North and South. I will continue to support the Minister for Foreign Affairs, Deputy Simon Coveney, in his engagements at the EU level and the ongoing engagement between the EU and the British Government to ensure the Northern Ireland protocol works well in the time ahead. It is important for the Republic, Northern Ireland and the island. The relationship between the two islands is also very important.

Deputy Matt Carthy

I know TB has been dealt with extensively. EU funding for this area has reduced on a year-on-year basis. The Minister mentioned that our test results last year pointed in the right direction for the first time in a number of years. Will that have an impact on EU funding? Will we be able draw down funds or will the Minister make the case to draw down additional income supports from the EU for the TB eradication programme?

Deputy Charlie McConalogue

It has had an impact. The reduced efficacy of the programme over the previous years had an impact and reduced our contribution from the EU to the programme. Thankfully, last year was the first year we saw the figures increase again.

I cannot tell the Deputy offhand how that will impact on the future contribution from the EU in support of the programme, but certainly any deterioration in the programme would have led to a further reduction in figures. Obviously-----

Deputy Matt Carthy

Does the Minister know what the EU funding for this programme will be for 2022?

Deputy Charlie McConalogue

I do not have that figure to hand, but I can forward it to the Deputy after the meeting. Two impacts have arisen from the increasing cost of the eradication programme over the past couple of years. The first is the fact that the EU contribution has been reducing and the second is that the higher incidence rates are leading to increased costs to the national Exchequer. Not only do we have to make up for the reduction in the EU's contribution, but the increased costs associated with having reactor animals, having to pay compensation and having to manage that challenge are also leading to an increase in cost. Hopefully, with everyone working together and the new TB strategy bearing some fruit, we will see the overall costs reduce and herd incidences continue to reduce in the years ahead.

Deputy Matt Carthy

On the phytosanitary regime in place and our preparedness for it, we have discussed the issue of seed potatoes and the difficulty with non-alignment at present. Is that conversation regarding potential alignment with Britain over? Are discussions ongoing?

Deputy Charlie McConalogue

They continue to be ongoing and we continue to raise issues at European level. The freer the interaction is between this island and our neighbouring island, the better it will be across all ranges of goods, including all food types. There is a challenge in that Britain is now a third country and, therefore, third-country rules apply. That means that seed potatoes, many of which had previously come from Scotland, cannot come in from now on. The EU is willing to facilitate that on the basis of veterinary alignment between Britain and the EU, but the British Government has not indicated its willingness to go down that route so there has not been progress. We will continue that conversation because we want as much engagement and the smallest number of barriers between Ireland and Britain as possible, but we have to work on the basis that there is no prospect of the situation changing in the short term. We have to turn that challenge into an opportunity to reignite our seed potato sector and supply seed potatoes nationally as opposed to from imports. We have the capacity in this country to grow seed potatoes in the same way that Scotland does.

I have had a number of meetings with members of the potato industry and the IFA national potato committee. I have made it clear and emphasised to them that it is very important that this is industry led. It is our industry nationally that is looking for seed potatoes and it is important they give confidence to those who are considering becoming seed potato growers that they will buy that seed potato from them, if they grow it, because it is a significant step for somebody to get into that industry. We need to see those relationships. We also need ware potato growers to build relationships with existing seed potato growers, in addition to new ones, to give certainty that if they grow seed potatoes this year, the growers will provide the market for them, depending on quality obviously. As Minister, I will certainly be doing all I can to support seed growers and ware growers to build that relationship through investment in the sector, for example, through the targeted agricultural modernisation scheme.

I was in the national seed potato base for the country, Tops farm in Raphoe, on Monday and met the team there, which is led by Gerry Doherty. I had a discussion with them about the work they are doing in providing seed potato and the genetics for it. I also opened a new glasshouse, which the Department invested in last year, that will expand its capacity to grow seed potato. There is an exciting opportunity to reignite this industry. Those working at Tops farm showed me documents going back to the 1970s and 1980s. My father was in the book as being a seed potato grower in the 1970s. The vast majority of farmers in Donegal then were growing an acre or a hectare of seed potatoes. Some 3,000 acres of seed potatoes were grown in the county in the late 1970s, while it is something like 200 ha or 300 ha now. In counties in the northern part of the country, in particular, there is a real opportunity to service that industry nationally and to add value. It is something we have to work to try to develop. I will certainly do all I can to push that.

Deputy Matt Carthy

Therein lies the issue-----

Chairman

The Minister seems to be suggesting it now, as well as the questioners.

Deputy Matt Carthy

It needs to be industry led, if it is going to be successful. Will the Minister or his Department provide guarantees that if those within the sector invest in developing seed potatoes for the domestic market, they will not be undercut if an EU-UK deal transpires, our market will not become flooded and people's investment will not be rendered useless? There is that genuine concern. If we can provide some guarantees, we will see a flow of investment.

Deputy Charlie McConalogue

It is very much within the industry's capacity to do that. I am looking at the means by which we can support that through investment, but it is within the industry's grasp to provide that certainty and to build up relationships. I have said very clearly to it that it should do that. I will very much support it in doing so.

Deputy Matt Carthy

On programme B, I will not repeat everything that has been said regarding forestry. We have had plenty of discussions on this matter. What is the current licence backlog? Does the Minister have that figure for us?

Deputy Charlie McConalogue

I do. As of 21 January, we had 3,597 licences on hand for more than 120 days. The total number on hand was 4,637. That is a reduction of 1,400 since last August. We have seen the-----

Deputy Matt Carthy

The figure I have is 5,000 in early November. The trajectory is going in the right direction, but I am sure the Minister will agree that the reduction is not steep enough just yet. In relation to that-----

Deputy Charlie McConalogue

It is strong and is gathering momentum every month. We will keep making progress.

Deputy Matt Carthy

It is a reduction of 300 since November. The Minister mentioned a number of times that the take-up rate for afforestation licences, that is, the actual implementation from receiving a licence to planting, is approximately 60%. It appears to be spectacularly low in that people go to the effort of securing a licence, and the afforestation process is not an easy one to go through, but then do not actually fulfil it. I previously asked both the Minister and the Minister of State, Deputy Hackett, whether there had been an engagement with those 40% or so who are applying for licences but are not seeing it through in order to identify the particular gaps that bring them to a point. These are people who have received licences. It would dramatically improve the figures if we could move them from having a licence in the drawer to trees in the ground. It would make everybody's life much easier, not just now, but in decades to come. Has a particular piece of work been done in respect of that cohort?

Deputy Charlie McConalogue

The stakeholder group under Project Woodland is looking at that. There has always been a gap between the number of afforestation licences issued and the number that then proceed to plantation, but it is important that is looked at. It is being considered as part of the Project Woodland review work.

On the issue of the Department moving forward with those files, it is contacting farmers who have afforestation licences asking them to confirm that they wish to proceed with their applications.

Deputy Matt Carthy

Direct contact is being made with those farmers who have not-----

Deputy Charlie McConalogue

Yes. This is being done in particular to ensure we can maximise the percentage. Each application takes a great deal of work and it makes sense to work on applications that applicants want to proceed with. The Department is double-checking that they intend to continue and want that work done, which makes sense, to ensure then the percentage is as high as possible. The figure for those proceeding to plant is approximately 60% currently. Afforestation licences are valid for three years and planting is to be done in that period. A clear-felling licence is a replanting licence and anyone who clear-fells has an obligation to reforest the cleared plantation within two years. The afforestation licences are for forestry in addition to the existing forestry stock. As the forest is clear-felled, it is replanted within two years and the afforestation then adds to the national stock.

Deputy Matt Carthy

In addition to making contact with the landowners involved, which is welcome and important ongoing work, we should also audit and carry out extensive research into why those with planting licences are not planting. As the Minister said, the level of work, cost and man-hours involved is substantial so we should not allow that to go to waste in the case of 40% of the licences issued when there may be a small number of relatively easy measures the Department could take to bring those licences across the line. It would be important to do that.

I will not discuss organics as we are short on time other than to ask one question. On the procurement of organics by Departments and statutory bodies, has the Minister examined measures to support the purchase of organic products by bodies expending public money, for example, in the case of hospitals and schools?

Deputy Charlie McConalogue

I do not believe we have done that but I will certainly take up Deputy Carthy's suggestion and pass it on to the Minister of State, Senator Hackett.

Deputy Matt Carthy

I have a number of other points which I wish to raise but I will allow others to contribute if they wish to do so.

Chairman

As no one is indicating, I will allow Deputy Carthy to continue.

Deputy Matt Carthy

On programme C, the allocation to Teagasc has been more or less static for the past number of years. Considering the reliance which so many sectors have on Teagasc-led research, is the Minister satisfied that its budget is sufficient to do all that we have been asking it to do? In every sector we discuss at this committee, we refer to the need to Teagasc to carry out some work. Is its budget sufficient to allow it to do everything that is required of it? Obviously there are additional pressures on the organisation arising from the ongoing climate action debates.

Deputy Charlie McConalogue

The Teagasc allocation increased by approximately €10 million in the 2022 Estimate. Last year, the total grant to Teagasc was €145 million, €139 million of which was for current expenditure. Its allocation has increased by approximately €8 million this year to €152.5 million. The biggest part of that increase, of which €3 million is current expenditure, is for capital expenditure, which has increased by approximately €4 million. The main dynamic and rationale behind that is the expenditure of €3 million for the national agricultural sustainability research and innovation centre in Johnstown Castle, which I mentioned in my opening address, and Ballyhaise Agricultural College in County Cavan, which I visited last week when I turned the sod on new student accommodation there. There is €1.5 million in the Estimate for this year towards that facility which will see the development of a new student block with 24 bedrooms to accommodate 50 students at an overall cost of €3 million, split between this and next year. This is a great facility and will be a very important investment in both the Deputy's region and my region. There is a strong allocation to Teagasc, for which funding has increased on both the current and capital expenditure side.

Deputy Matt Carthy

I thank the Minister for his reply.

On subhead C10, the Strategic Banking Corporation of Ireland, SBCI, loan scheme, reads as a decrease from €18.7 million to €13.2 million. Is that new money or is it the case that when money is repaid, it goes back into the pot? In other words, can it be re-loaned or is this an actual decrease in the money available?

Deputy Charlie McConalogue

If the money is not fully utilised or taken up, it becomes available again. We prepaid some of this money from capital savings and free capital this year in forward payment. We have fully supported both the Brexit income loan scheme and also the Covid-19 income support scheme through that funding.

Deputy Matt Carthy

My understanding is that the money that is allocated for agricultural programmes is almost 100% utilised, which is obviously positive. What I am trying to get at here is an understanding of whether, when farmers are repaying their loans, that funding comes back for reissuing or is that the end of funding in the scheme and we then rely on whatever the headline figure is on subhead C10?

Deputy Charlie McConalogue

By virtue of the State covering the cost of the risk, farmers are able to avail of a lower interest rate. That is how this works. In both the Brexit impact loan scheme and the future growth loan scheme, 80% of the risk of the loan is covered by the Strategic Banking Corporation of Ireland. This leads to a reduced loan interest rate for the farmer concerned. There is a cost associated with this and a payment to the banking institution for the reduced interest rate that is ultimately made available to the farmer. If loans are not fully used up, payments are not made to the banks for the unused parts, leaving spare capacity which we could look to use in an alternative way. There is a cost-----

Deputy Matt Carthy

My apologies; I am probably not explaining myself properly. Last year, in the 2021 Estimate figure, some €18.7 million was available under these loans. Assuming they were all drawn down, farmers would have been repaying that money. When that money is repaid to the banks, does it become available to be reissued under the same scheme or are new farmers who apply relying wholly on the €13.2 million that has been earmarked for SBCI in the subsequent year?

Deputy Charlie McConalogue

The way this works is that because the farmer is availing of a lower interest rate, part of the cost of that interest rate is made up by the SBCI. Ultimately, the farmer is paying back less because the SBCI is making a paying to the banking institution. While the farmer will be repaying the loan, it will be at a lower interest rate because the additional interest that would have applied has been covered by the SBCI.

Deputy Matt Carthy

I will move on to programme D, for which the allocation increased by €30 million or thereabouts. Does that increase include the €25 million announced for Rossaveal Harbour? With Deputy Mairéad Farrell, I have met campaigners in the area a number of times, so I welcome that funding. For clarification, will that funding come out of the budget allocation before us?

Deputy Charlie McConalogue

Yes, although it will not all be provided in one year. Our plan is to go to tender by the end of this year and for substantial work to be done next year and into the following year. The funding will come from the national funding allocation.

Deputy Matt Carthy

The full €25 million is not coming out of the increase of €30 million in this Estimate. Is that correct?

Deputy Charlie McConalogue

It will be spread over two or three years.

Deputy Matt Carthy

Does the Minister have any sense of what the 2022 outturn will be?

Deputy Charlie McConalogue

It was €22 million last year. I do not know what it will be at this point. We have a total of €31.9 million in the capital Vote for 2022. That is for the fishery harbour centres. Alongside that, we have the local authority funding, which I am using the Brexit adjustment reserve to draw down. Over the next two years, it is planned to spend €35 million on the smaller piers and harbours. That work will be funded to the tune of 85%, with local authorities providing the other 15%. In terms of the six fishery harbour centres, the funding this year will be €31.9 million in total.

Deputy Matt Carthy

Will the funding required to implement recommendations in the seafood task force report be drawn down entirely from the Brexit adjustment reserve fund, will it come from these Estimates or does the Minister plan to bring in Revised Estimates?

Deputy Charlie McConalogue

I am continuing to engage with the Department of Public Expenditure and Reform on the Brexit adjustment reserve to try to ensure we are supporting the fishing sector in every way we can. That is where the €35 million for the local authorities comes in. Obviously, I am continuing with our normal funding for the fishery harbour centres. That remains in place, but I am also looking at other opportunities, working with the Department of Public Expenditure and Reform.

Deputy Matt Carthy

That is all from me.

Chairman

As no other members are indicating, we will adjourn. That concludes the select committee's consideration of the 2022 Revised Estimate for Vote 30 - Agriculture, Food and the Marine. In accordance with Standing Orders, a message to this effect will be sent to the Clerk of the Dáil. On behalf of the select committee, I thank the Minister and his officials for assisting the committee with its consideration of the 2022 Revised Estimates and for dealing so comprehensively with the questions of members.