Thursday, 14 Nov 2013

Priority Questions

Single Payment Scheme Payments

Ceisteanna (1)

Éamon Ó Cuív

Ceist:

1. Deputy Éamon Ó Cuív asked the Minister for Agriculture, Food and the Marine the number of farmers who have received letters regarding over-claims under the single farm payment scheme and other schemes for 2013 due to the EU ordered review of all claims for the past five years; the number of cases examined to date; the number of cases still to be examined; the amount of money being sought back from farmers to date for previous years; the number of 2013 payments held up pending the review of claimed area; and if he will make a statement on the matter. [48460/13]

Freagraí ó Béal (19 píosaí cainte)

Deputy Éamon Ó Cuív

Many farmers are receiving letters from the Minister looking for payments back over five years. Many are wondering whether those letters will drop in the post some day. Some of them are for hectarages of 0.01, 0.02 or 0.03 hectares. This is a matter of great concern and the penalties in some cases are disproportionate. I mentioned a case to the Minister which involved an equivalent penalty of €12,000 per hectare. We need to see the end of this matter.

Minister for Agriculture, Food and the Marine (Deputy Simon Coveney)

The Deputy will be fully aware of the importance of payments made under the single payment scheme, the disadvantaged areas scheme and other direct payment schemes to the annual income of farmers. To date, my Department has paid €582 million in advance payments to more than 115,143 farmers under the 2013 single payment scheme since payments commenced on 16 October. Some 84,800 farmers have received just under €180 million under the 2013 disadvantaged areas scheme. Payments continue to issue under both schemes as cases become clear and eligible for payment. I reassure farmers that no payments are held up due to the ongoing LPIS review.

Department officials met the Commission in July of this year about possible disallowances and, in response, my Department is reviewing all land parcels claimed. This means in effect a review of all 950,000 land parcels. This is a mammoth task but my Department is making every effort to ensure it will be completed in a manner that satisfies the Commission and avoids significant disallowances for Ireland. As a result of this phase of this review, any payments made to farmers in respect of claimed areas which were found to be ineligible must be reimbursed. That is for 2013. No decisions have yet been made in respect of retrospection and there is no detail regarding that in the letters that have gone out to farmers. The review of the 950,000 parcels contained in the LPIS database is well advanced at this stage, with more than half the parcels reviewed, and it is on target to be finalised in time to allow a comprehensive response to the Commission which is required by 15 December.

To date, 19,418 over-claim letters have issued to farmers, together with maps of the land parcels in question. It should be borne in mind that for 75% of farmers, the over-claim will have no impact on payment as many farmers declare more land than payment entitlements, and a further 18% of farmers have a minimal payment reduction. The average over-claim is less that €90 or just over €300 for those applicants with a reduction and penalty. These figures are based on 2013 payments only.

Additional information not given on the floor of the House

In the letters issued to date there is considerable detail and maps to advise of the particular over-claims. Farmers are also informed of the appeals process should they disagree with my Department's findings. The appeals process I have introduced is robust and comprehensive. In the first instance, applicants are entitled to have their case reviewed by submitting their appeal on the form provided by my Department. If they are not satisfied with the outcome of the review, they can appeal their case to the independently chaired land eligibility appeals committee, details of which I announced recently. This committee will consist of an independent chairman and appeals officers from the agriculture appeals office.

Deputy Éamon Ó Cuív

The Minister said that no farmer had received a letter detailing a fine. I have two comments to make. I can produce-----

Deputy Simon Coveney

They are not fines.

Deputy Éamon Ó Cuív

It is a disallowance or a penalty or whatever one wants to call it.

Deputy Simon Coveney

It is not a penalty. It is a reimbursement of money that should not have been paid out. The Deputy should not heighten an already difficult situation for many farmers.

Deputy Éamon Ó Cuív

I know I have only one minute but I am entitled to ask the question without interruption. The second thing is that when farmers get the letters at the moment, there is a general sheet outlining the penalty regime, but they are not told specifically what the penalty is in their case. Can the Minister tell me why this is the case?

Why is it that at the end of October, despite the guff about all the money the Minister has spent, the Department is €96 million behind profile in spend? In other words, €96 million that the Minister had programmed to send to farmers has not yet been paid. Can he explain the reason for this €96 million underspend by his Department at the end of October against what was expected at the beginning of the year? It is outrageous.

Deputy Simon Coveney

It is not outrageous and I will explain why.

On the initial question, this is not penalties for farmers. It is about reimbursement of money that was drawn down on land that was ineligible for payments. We are legally required to collect that money. Unfortunately, we have had, and we continue to have, many corrections in the mapping system which is the basis for farmers' claims of their payments. Let us be very clear about what happens if we do not do this. We know what will happen because the Commission has imposed fines on other countries that have not responded satisfactorily to this. The Commission calculates the level of overpayment, multiplies that figure by five and applies that disallowance or fine to Ireland. Much bigger and more politically influential countries in Europe have had massive fines imposed on them, such as the UK, France and Italy. I am seeking to avoid that eventuality because it will mean we would have to take that disallowance from the budget we have to spend on farms.

On the €96 million-----

An Leas-Cheann Comhairle

I must be fair to both sides, Minister. You must conclude. I am in a very sticky position.

Deputy Simon Coveney

The Deputy knows well what the answer is about the €96 million. That money will be spent before the end of the year.

An Leas-Cheann Comhairle

I will come back to the Minister after the Deputy asks a supplementary question.

Deputy Éamon Ó Cuív

Perhaps the Minister will explain something. There is a disallowance due to errors that were made, minor errors in many cases, in the last four or five years. Some of these are as small as 0.01%, 0.02% and 0.03%, but when small farms are involved there is a disproportionate penalty.

Deputy Simon Coveney

There is no penalty involved.

Deputy Éamon Ó Cuív

Why are the farmers bearing the brunt of this mess? Second, can the Minister explain why there is €100 million in the coffers of the Department which should be in farmers' pockets to allow them to pay the people to whom they owe money?

Deputy Simon Coveney

I will respond to the second question because the Deputy is deliberately trying to cause trouble. He understands exactly what the situation is in the Department, having previously been a Minister. A huge portion of our payments are made in the last third of the year. This year, the date for the budget was brought forward significantly, but we will spend the Department's allocation for the full 12 months that was made in last year's Estimates for this year. There was a €96 million underspend at the time of the budget, but that money will be spent.

Deputy Éamon Ó Cuív

The underspend is at the end of the month of September. The Minister is holding money back.

Deputy Simon Coveney

The Deputy should let me answer the question. He knows the answer but he is trying to be deliberately mischievous.

Deputy Éamon Ó Cuív

I am not. I am being factual.

Deputy Simon Coveney

The Deputy should judge my Department on whether it has an underspend at the end of the year. We are budgeting for the year and there will not be a significant underspend at the end of it.

Trade Agreements

Ceisteanna (2)

Martin Ferris

Ceist:

2. Deputy Martin Ferris asked the Minister for Agriculture, Food and the Marine the health information Canadian beef and pork producers will be obliged to provide before their exports will be allowed onto the Irish market. [48506/13]

Freagraí ó Béal (8 píosaí cainte)

Deputy Martin Ferris

The Canada-European Union Free Trade Agreement, CETA, was welcomed by the Canadian establishment and particularly by the Canadian Prime Minister. It means the removal of all tariffs from much Canadian produce on the EU market. What will this mean for Irish industry, particularly farming? I recollect that when John Bryan was chairman of the Irish Farmers' Association, IFA, livestock committee he fought tooth and nail against Brazilian imports and he fought that campaign mainly on health and safety grounds. Last year the second largest beef producer in Canada-----

An Leas-Cheann Comhairle

The Deputy just has 30 seconds to introduce the question. He will have an opportunity to speak again.

Deputy Martin Ferris

What will it mean for Ireland?

Deputy Simon Coveney

Under the EU-Canada trade agreement initialled last month by President Barroso and the Canadian Prime Minister, Canada was awarded a tariff rate quota for beef of 50,000 tonnes carcase weight equivalent. This equates to a quota of 39,000 tonnes of boneless beef. The quota is split between fresh and chilled beef comprising 31,000 tonnes, plus the existing 4,000 tonnes quota as part of the hormones agreement, and frozen beef comprising 15,000 tonnes. As regards pigmeat, Canada was awarded a quota of 75,000 tonnes.

The agreement has yet to be endorsed by the EU Council of Ministers and the European Parliament. Moreover, certain matters, including details of the management of tariff rate quotas, have still to be finalised. However, under EU veterinary legislation the principle of equivalence will apply. This means that all imports of beef and pigmeat into the EU must be produced to standards equivalent to those applicable in the EU and in plants that are approved by the EU Commission. The regime is monitored by the EU Food and Veterinary Office.

There was concern about the EU-Canada agreement. Ireland has been very involved in this at a very high political level in the European Union. What Canada was seeking initially was a far higher beef quota access to the European Union that did not have the restrictions of chilled or fresh and frozen, so the deal that has been struck is much better than what was sought at the outset. It is also important to note that Canada does not have a beef industry of any scale that produces hormone free beef, which is the beef that will have to come into the European Union because of the restrictions in the Union. The assessment made by Teagasc is that Canada simply does not have the capacity to sell large volumes of hormone free beef into the European market and will not have it in the next three to four years. This might become an issue in terms of increased amounts of Canadian beef coming into the EU, but it will not happen immediately. Also, of course, we have opportunities in terms of significantly increased dairy access into the Canadian market from the European Union.

The deal could have been much worse and Ireland was very much involved in limiting the damage in that respect.

Deputy Martin Ferris

The Minister will be aware that the second largest beef producer in Canada, XL Foods Inc., had its operation closed down due to an E.coli outbreak. A $10 million court case was brought by people who became ill due to the outbreak. The plant owners have claimed that the Canadian Food Inspection Agency's testing practices at the time were not stringent enough to protect consumers from the E.coli contamination. Can the Minister give an assurance that the same stringent regulations that apply to European produce will apply to Canadian produce?

Deputy Simon Coveney

Yes, in so far as I can, but I rely on the European Food Safety Authority at European level to do that. I doubt that we will not see Canadian beef coming into the Irish market, but Canadian beef might come into other markets in the European Union where we currently sell beef so it will undoubtedly be competition. However, I do not believe this will happen overnight, and there are increased opportunities for the European and Irish dairy industries to sell increased volume of product into Canada.

One of the other concerns about this is that it might set a precedent for the EU-US trade discussions on beef and, indeed, EU-Mercosur discussions on a bilateral trade agreement. We have made it very clear that what has been done with Canada was designed for the EU-Canadian relationship and should not be used as a precedent for other trade deals.

Again, this could have been a good deal worse. Canada sought far more access than what it got. While what we have now is of course a concern for the industry over the next five to ten years, it is manageable.

Deputy Martin Ferris

As the Minister said, the concern is that it opens the door and once the door is opened, where does it end? The concern for Irish producers is whether they can compete, given the traceability and stringent measures that are applicable here, with countries over which the EU has no control and which do not have a very good track record.

Deputy Simon Coveney

On the control issue, we will insist on veterinary equivalence. That means beef produced in Canada will have to be produced under the same conditions we have here. There will be limitations on hormone use and other practices regarding welfare and so forth and there will have to be an inspection scheme that reassures European consumers that this is the case.

This will apply to other parts of the world as well.

Clearly, the Irish beef industry can compete. The week before last, I returned from the Gulf states where we are starting to sell more beef again. There was a time when Ireland supplied Saudi Arabia with between 30% and 40% of its entire beef consumption. Ireland has proven its capacity to compete in the beef industry both outside and inside the EU because we provide a competitively priced, very high-quality premium product. In fact, Irish beef has improved down the years and we now have a better product than we have ever had. We can compete, but we need to monitor the situation closely.

There is access for Canadian beef already, but it is limited to approximately 4,000 tonnes of hormone-free beef. If the Canadians want to access the European market in a more significant way, they will need to build a hormone-free beef industry in Canada, which many people claim may never happen, given that it is a different type of beef production.

Electricity Transmission Network

Ceisteanna (3)

Mattie McGrath

Ceist:

3. Deputy Mattie McGrath asked the Minister for Agriculture, Food and the Marine if there has been any risk-benefit analysis carried out regarding the impact that the EirGrid grid link project will have on the agricultural economy of south Tipperary; if his attention has been drawn to the fact that south Tipperary has a thriving beef and dairy industry with major companies having long established businesses there; and if he will make a statement on the matter. [48462/13]

Freagraí ó Béal (28 píosaí cainte)

Deputy Mattie McGrath

I asked this question because there could be implications if we do not do a cost-benefit analysis and impact assessment of the damage that will be done to agriculture in south Tipperary and elsewhere by this ruinous project, which serves big business and will not do what it is supposed to, namely, maintain our energy supplies. I plead with the Minister. His colleague, the Minister of State, met a select group last Monday night, kept his head down and said that the project would go ahead and that the Government could not stop it. I am depending on the Minister. I believed that the Minister of State, Deputy Tom Hayes, would look after south Tipperary, but unfortunately he will not.

Deputy Tom Hayes

Misquoting again.

Deputy Simon Coveney

I will not rise to the bait to create some kind of political-----

Deputy Mattie McGrath

Freagair an cheist. There is no bait.

Deputy Simon Coveney

First of all, this question should really have been directed to the Minister for Communications, Energy and Natural Resources.

Deputy Mattie McGrath

He will not answer.

Deputy Simon Coveney

Grid 25 represents a more than €3 billion investment programme to develop and upgrade the electricity transmission network across the country. Of course this will involve a network crossing rural areas. We already have a considerable electricity network crossing farmland all over the country without any significant negative consequence of which I am aware. Perhaps the Deputy can provide evidence to suggest that there is. We already have two 410 kV lines crossing the midlands from Moneypoint to Dublin. The vast majority of that journey is farmland, but I am unaware of any disastrous consequence from that.

There is an obligation on EirGrid to do a proper job, including all of the assessments that are necessary to reassure people and to pick the right route, but it is not for me as the Minister for Agriculture, Food and the Marine to dictate to EirGrid how it should do that. It has a statutory obligation to do it properly. We are in the middle of a public consultation process in that regard and people are having their say. They are vocal and concerned about this matter.

Deputy Mattie McGrath

As the Minister should be.

Deputy Simon Coveney

We need to provide sufficient information and supporting evidence to reassure people, but I do not accept that putting electricity infrastructure around the country, thereby improving our grid, a move from which everyone will benefit in terms of energy prices, as this is not just a question of big and small business-----

Deputy Mattie McGrath

Of course it is.

Deputy Simon Coveney

It is a question of putting a modern electricity infrastructure across the country so that we can do what me must in terms of renewables and move electricity around the country. We need to do this properly, which is EirGrid's statutory obligation.

Deputy Mattie McGrath

I acknowledge that the Minister attended to answer these questions. I tabled questions to the Minister for Communications, Energy and Natural Resources, Deputy Rabbitte, but they were ruled out of order because he claimed that he had no responsibility for EirGrid. He can appear on every radio show, including the local station of the Minister of State and me yesterday, as its spokesperson, but he will not answer to the House. Accountability is gone out the window. The Government complained about this when it was in opposition.

The Minister of State and many of his colleagues were bussed down to Coolmore Stud some time ago, but I have deliberately not mentioned the equine industry or the massive effect that overhead cables will have on it. It is large enough to fight for itself. I am sure that the busload of backbenchers who travelled with the Minister of State will be able to fight for it. I am representing the ordinary people. EirGrid has stated that it would prefer cereals to be grown under these cables, not livestock.

The Minister knows the importance of agriculture. His duty is to spend the money that Deputy Ó Cuív claimed he did not spend. However, his duty seems to be to claim that this is not his responsibility, but that of the other Minister, Deputy Rabbitte. He referred to energy security. I accept that is important, but we cannot devastate the rich farmlands of south Tipperary and we cannot allow big business to plunder south Tipperary. We kept Cromwell out of south Tipperary and we will keep EirGrid out as well. If the Minister will not do it, we will have to do it ourselves. The Minister of State, Deputy Tom Hayes, will unfortunately not do it, but the Minister should.

Deputy Simon Coveney

This is not about big and small business.

Deputy Mattie McGrath

It is.

Deputy Simon Coveney

This is about trying to put modern infrastructure in place-----

Deputy Mattie McGrath

Lies and damned lies.

Deputy Simon Coveney

-----that everyone will benefit from in terms of more affordable electricity and a more efficient mechanism for transporting energy around the country. It will also allow us to put new types of energy generation in place in parts of the country. We are in the middle of a process, but the Deputy is suggesting that I-----

Deputy Mattie McGrath

Protect agriculture.

Deputy Simon Coveney

-----get involved in that process. We have a State-owned company, EirGrid, the responsibility of which is to roll out infrastructure across the country. As part of that, it is going through a legal process involving planning applications and public consultation. This process will take its course. EirGrid is obliged to put infrastructure in place in a way that is responsible, takes account of best international practice and reassures the public that it is safe.

Deputy Mattie McGrath

I am not suggesting that the Minister should do anything. I am demanding that he, as the Minister responsible for agriculture with his colleague, stand up and protect rural Ireland and farmers from something that will have consequences for generations. The Minister did not mention Food Harvest 2020, but we in south Tipperary and the Golden Vale play a major part in that. It must be defended. I demand that the Minister step up to the plate as the line Minister, with the Minister of State, who I wish no ill, and tell EirGrid that these lines can go around. The Minister knows this better than anyone. He is a man who likes a bit of sailing. In our case - it is not much good for the rest of the country - they could easily go around the seashore to Wexford from Cork, where they start. They cannot in other cases. However, EirGrid does not want to do this. It can be and has been done elsewhere. I do not want the Minister to become a spokesperson for EirGrid. The Minister, Deputy Rabbitte, is its mouthpiece. Unfortunately, he will not answer questions in the Dáil, but he will go on every airwave, including "Morning Ireland" this morning, to rubbish them. Every Government Member opposed the north-south line while in opposition and promised that, when they got into government, they would shred that plan and put everything underground or else nothing would happen.

Deputy Simon Coveney

When I was in opposition, I was involved in this debate. We did not promise to put everything underground.

Deputy Mattie McGrath

The Minister's colleagues up and down the country did.

Deputy Simon Coveney

They did not, actually.

Deputy Mattie McGrath

I was at public meetings in the north east where-----

Deputy Simon Coveney

I have met the North East Pylon Pressure, NEPP, group a number of times. Many good people are involved in it. I was involved in long hearings at committee level that examined the different technologies, potential alternative solutions and the costs involved. This is not an easy issue to resolve. Anyone who pretends it is, that we could put everything underground and that there would be no problem for anyone, is being misleading.

Deputy Mattie McGrath

The sea has not been examined.

Deputy Simon Coveney

There is a difference between a direct current line and an alternating current line, which is what the grid must be. If one takes electricity from A to B without needing to take any power from that infrastructure between those two points, one can use a direct current line. It is much easier to put direct current lines underground. We do it all of the time. Alternating current, which is what the grid needs to be, poses a more complex problem. The Deputy should know this. We are in the process of trying to roll out that grid while reassuring the public. EirGrid has an obligation to do so to the best of its ability. It is in the middle of that process.

Deputy Mattie McGrath

The Minister has made a nice new appointment of a CEO.

Common Agricultural Policy Reform

Ceisteanna (4)

Éamon Ó Cuív

Ceist:

4. Deputy Éamon Ó Cuív asked the Minister for Agriculture, Food and the Marine the position regarding his consideration of the Common Agricultural Policy programme for Ireland 2014-20; the level of co-funding being proposed for Pillar 2; and if he will make a statement on the matter. [48461/13]

Freagraí ó Béal (22 píosaí cainte)

Deputy Éamon Ó Cuív

Many people are anxious about the Common Agricultural Policy, CAP. As the Minister knows, most of the decisions will be made nationally. There is already significant concern about the 18% cut in Pillar 2 payments in real terms, taking inflation into account, but concern is also growing that the Government will not match European money on a 50:50 basis with Exchequer funding. Will the Minister allay farmers' fears and state clearly that there will be 50:50 co-funding of Pillar 2 payments under the new CAP?

Deputy Simon Coveney

We are in a process and, before the end of the year, as I have said repeatedly, we will provide full clarity concerning the Pillar 1 and Pillar 2 payments. Pillar 1 is more straightforward and I have outlined my views on it many times. Some issues need to be decided upon, including whether we introduce a level of coupling, whether to transfer money between pillars, and the levels of support for young farmers.

The Deputy is right to say Pillar 2 is more complex. That is because I know how much money I have to spend on Pillar 1 and it is just a matter of deciding how to distribute that between farmers. On Pillar 2, however, I do not yet know how much money I will have to spend. Some €313 million comes from the EU each year, but I do not know what level of co-funding we will add to that to make up the full rural development fund. I will have to get a Government decision on that but it has not yet been taken.

This assumption that it is the norm to have 50:50 co-funding for rural development is not true. Even in Deputy Ó Cuív's time in government when we had loads of money to spend, we did not provide 50:50 co-funding. Let us be realistic therefore. Even in the good times in Ireland we were not providing 50:50 co-funding for rural development in terms of the average spend on such development over the past seven years.

I am trying to maximise the funding for rural development programmes and the rural economy generally. I will do that as effectively and proactively as I can. I will be talking to my Government colleagues to try to secure the maximum level of funding, but we need to design a rural development programme that reflects the ambitions and challenges of Irish agriculture for the next seven years. I assure the Deputy that I will not be designing a rural development programme which is simply to draw down all the EU money and minimise the Exchequer contribution. I will try to maximise the financial contribution and the effect of the programme that it will fund over the next seven years. The Deputy will see the actual numbers before the end of the year.

Deputy Éamon Ó Cuív

I have the figures for the previous programme in front of me. Effectively, it was just under €2.5 billion from Europe and just over €2.3 billion from the Exchequer, so it was a 53:47 split. Can the Minister confirm he will match that in percentage terms and stop trying to obfuscate? People are concerned that, under the environmental programme in particular, the payment could be much more skewed than that. Will the Minister confirm that the Exchequer funding will be at least 45%? Why not make the decision now? Why put it off? He has to work on a multi-annual framework in any event.

Will the Minister confirm that the second payment of the single farm payment this year under the new multi-annual financial framework will be reduced by just under 5% due to the new MFF? Will the Minister confirm there will be a cap on payments per hectare in the single payment? Will he explain the position on variable greening versus flat greening? What justification can he give concerning his preference for variable greening?

Deputy Simon Coveney

I am not sure how long I have to answer these questions. The Deputy has asked four or five questions that require detailed answers. Let me start with the last one.

An Leas-Cheann Comhairle

I have to obey Standing Orders.

Deputy Simon Coveney

We have had the debate on variable versus flat rate greening. My view on this, for which I campaigned at European level, is that a country should have the option for what is called variable greening. In my view, that will ensure all farmers will have the same incentive to implement the greening requirements.

Deputy Éamon Ó Cuív

What? Can the Minister repeat that?

An Leas-Cheann Comhairle

Please allow the Minister to reply.

Deputy Simon Coveney

It is not the first time the Deputy has heard it.

Deputy Éamon Ó Cuív

Is the Minister saying the incentive is the same regardless of whether one is paying €150 or €400?

Deputy Simon Coveney

It is the same percentage incentive.

Deputy Éamon Ó Cuív

The Minister did not say that the first time. What is the percentage?

An Leas-Cheann Comhairle

Deputy Ó Cuív will have another chance to speak.

Deputy Simon Coveney

If the Deputy wants to keep talking we will run out of time, but if he wants to listen to the answer I will give it to him.

Deputy Éamon Ó Cuív

What is the percentage?

An Leas-Cheann Comhairle

I will call Deputy Ó Cuív again.

Deputy Tom Hayes

That is six questions.

Deputy Simon Coveney

The European Commission refers to what is called a 30:30 greening obligation on farmers. That means that 30% of Pillar 2 moneys will be guaranteed to be spent on environmental schemes, and 30% of a farmer's payment will be withheld unless he or she passes the greening criteria. If somebody is on €400 or €500 per hectare versus someone on €150 per hectare, one needs the incentive for the person on a higher payment to ensure they implement the greening criteria. We have tried to simplify this for farmers whereby 30% of their payment will be withheld unless they pass the greening criteria. That is what I mean when I say that the incentive must be the same. Otherwise people on higher payments will not have the same incentive to abide by the greening criteria. I do not think that would be a sensible policy perspective.

Deputy Éamon Ó Cuív

I take it that the Minister will not give any more information on Pillar 2 funding. He is getting a lot of trouble from his colleague, the Minister for Public Expenditure and Reform. Can the Minister confirm that the second payment under the single farm payment this year will face a 5% cut due to amendments in the MFF? Perhaps he can tell farmers whether that is correct.

Deputy Simon Coveney

Farmers know the consequences of the MFF, as we have been very upfront and transparent about it. The Deputy is repeating negative messages to try to upset people. The MFF negotiations were a significant success. We limited the reductions in direct payments to about 3%. Two years ago, people were talking about reductions of 30%, so the Taoiseach did a great job in protecting Common Agricultural Policy money and forming alliances with other countries, particularly France, to limit the losses. There is some loss, however, and farmers know that. We have been open and transparent about it. I cannot give figures on Pillar 2.

Deputy Éamon Ó Cuív

Is there a 5% cut?

Deputy Simon Coveney

I cannot give figures on Pillar 2 because we have not yet decided on that. It is not my decision alone. It is my decision along with the Minister for Finance, the Minister for Public Expenditure and Reform and their Departments. We need to put expenditure in place for the next three years and I need an expenditure commitment for the next seven years. I assure the Deputy that I will be fighting hard, as I always do, for agriculture, farmers and the agrifood business to ensure we put as much public money as we can into those areas, both from Europe and the Exchequer. As the economy starts to grow, I want to ensure we can increase funding for a sector that is giving far more than it is taking from the economy. Until those decisions are finalised, I cannot give the Deputy a figure.

Sugar Industry

Ceisteanna (5)

Martin Ferris

Ceist:

5. Deputy Martin Ferris asked the Minister for Agriculture, Food and the Marine the position regarding restarting the beet industry as a result of the proposed end of the beet quota in 2017; and if he will make a statement on the matter. [48507/13]

Freagraí ó Béal (6 píosaí cainte)

Deputy Martin Ferris

We in Sinn Féin, and many others, totally opposed the closure of the sugar beet industry. It should never have been privatised but should have remained in public ownership. That industry served rural Ireland very well. Sugar beet should have been retained as a rotation crop for corn and wheat producers. There are encouraging signs at the moment, so can the Minister provide an update on whether a private consultancy is at an advanced stage in trying to bring this industry back into the country?

Deputy Simon Coveney

No one would be happier than me to see the sugar industry back in Ireland again. I have delivered many tractor-loads of sugar beet into what was a viable and profitable beet factory in Mallow. I have produced beet and have a reasonable understanding of that industry. Along with many others, I was sceptical and critical of how that industry ended in Ireland.

I do not believe the question of whether the business was privatised at the time would have made a difference. The Government at the time made the decision to end the sugar industry in Ireland, which I am sure Deputy Ó Cuív knows all about. This Government, through me, has provided the opportunity for this industry to re-emerge. We fought hard for the abolition of sugar quotas and it is now up to the industry to put together a proposition around rebuilding a sugar, probably linked with ethanol, plant in the future and to make the numbers in that regard add up.

I have met with two different consortia on this issue, both of whom are, in my view, very credible. I have remained in contact with one of them. There are very good people involved, including people like Mick Hoey from Country Crest and others, who are giving great leadership in this area. This is a significant commercial proposition. It will cost between €250 million and €350 million to build a significant processing plant of the scale required to compete in the European sugar processing area. I hope it can happen. The Government will be as supportive as it can be. However, I will not subsidise an industry only to find in the future I cannot further subsidise it and it collapses. This industry must be able to stand on its own two feet. I believe it has a fighting chance. There are great people involved in trying to make it happen. I hope it will happen. Time is on their side because sugar quotas remain in place until 2017. There is a great deal of credible work going on to make this happen.

Deputy Martin Ferris

I welcome that people are attempting to make this happen. It would appear from the Minister's reply that those attempts are credible and that the project is being advanced. The Minister mentioned that the State would not provide financial support. I ask that if some support is required to get it over the line the Minister would reconsider that decision. I am not suggesting that this will be necessary. The re-establishment of that industry in the country from an agricultural and job creation point of view is important. When the industry collapsed many jobs were lost in Carlow and Mallow. I was in this House when political assurances were given that the Mallow plant would remain open. However, it closed within 12 months.

Deputy Simon Coveney

People should not underestimate just how positive a sugar industry is for agriculture. It is a great crop and a cash crop for farmers that is not reliant on payments and subsidies. If we can rebuild this industry, we should do it. My understanding is that approximately half if not two thirds of the hectarage of sugar beet that was grown when we had a sugar industry is still grown in Ireland. Farmers like to grow it. They use it as a sweetener and feed source for livestock. Farmers are good at and like growing this crop. The issue is whether the level of investment will be able to provide a return that is commercially viable and bankable and whether we can put together a consortium that can make this happen. It is a huge investment.

The arms of the State are available in the normal way in terms of support, including Enterprise Ireland and so on. Ultimately, this needs to be a commercial proposition so that farmers know that if they start producing sugar beet for a sugar or ethanol industry it will be a lasting industry. Financially, the commercial proposition must stand on its on two feet. I will be as supportive as I can be.

An Leas-Cheann Comhairle

We will move on now to Other Questions.

Deputy Simon Coveney

On a point of information, a Cabinet meeting has been called this morning, which I have to attend for approximately 15 or 20 minutes. My colleague, the Minister of State, Deputy Tom Hayes, will deal with some the questions while I am away. I will return for the remainder of oral questions, if possible. I appreciate the understanding of Members in this regard.