Thursday, 18 October 1984
Dáil Eireann Debate
Mr. P. Barry: The draft Community budget for 1985 was formally established by the Council of Foreign Ministers in Luxembourg on 2 October. It has now gone to the European Parliament for consideration in accordance with Treaty procedures.
While the draft 1985 budget has been drawn up within the upper limit of the Community's own resources, that is the 1 per cent VAT limit, the Community is assured of being adequately financed in 1985, since Foreign Ministers agreed at the last Council on a declaration to  accompany the 1985 draft budget undertaking to meet by 1 October 1985 the additional budgetary requirements which will arise in 1985 through a supplementary and amending budget for which additional funds will be provided.
Mr. G. Collins: Does the Minister agree that if the draft budget for 1985 is kept within the 1 per cent VAT ceiling the budget will be short at least £2,000 million next year? Will he agree that this could mean there would not be any price increase for farmers in 1985-86 and severe cutbacks in existing support schemes?
Mr. P. Barry: That is why a declaration was attached to the budget when it went to the Parliament. Arrangements to meet the shortfall referred to by the Deputy, though not of that magnitude, will be made before 1 January 1985 to supply the additional funds.
Mr. MacSharry: Leaving aside the question of the supplementary budget and taking the draft budget as formulated and agreed by the Council of Ministers and as presented to Parliament, can the Minister confirm that it is approximately £900 million short for anticipated agricultural expenditure and that there is no provision for £850 million of a refund for the UK nor is there any provision for agricultural product price increases?
Mr. P. Barry: That is correct but we cannot leave aside the question of a supplementary budget. In submitting the draft budget for 1985 to the Parliament the General Affairs Council specifically said they would meet, by way of supplementary budget, on or before 1 October  1985 whatever was required to make sure funds were available.
Mr. MacSharry: I am delighted that the Minister has confirmed the figures I gave a few weeks ago when he stated publicly we were misinformed. Can the Minister state if, in presenting their budget for this 12-month period, the Council are realistic in their approach to the finances which are now known to be necessary to run existing services? There has been an airy-fairy form of words used.
Mr. MacSharry: Is the Minister aware that these words are insufficient? Can he state, if the supplementary budget is brought in on 1 October, where the resources will come from? Will they be in the form of a contribution from each member state or will an increase in the 1 per cent VAT be brought in? Have the Council taken any decision in that regard?
Mr. P. Barry: That is a long question and requires a long answer. I did not dispute the figures referred to by the Deputy. What I said was when the members of the Fianna Fáil Party issued a statement from sunny Sardinia——
Mr. P. Barry: When they found time to put down the long cool drink on the beaches of sunny Corsica and apply themselves for a short while to the affairs of the EC, in a typical reaction they said this was no solution to the problem——
Mr. P. Barry: It was the kind of antediluvian response we have come to expect from the party opposite. This is a commitment by the ten member states, without saying how it will be done whether by own resources or a supplementary budget, that the shortfall will be met on or before 1 October 1985. We must accept that the ten countries comprising the EC would not give such a commitment lightly.
Mr. MacSharry: Can the Minister say if, arising from another aspect of the statement made by the Council to the Parliament, there will be strict budgetary control and control of agricultural expenditure during 1985? Is he satisfied that sufficient resources will be provided to run existing agricultural services from our farmers' point of view and that there will be some product price increases in 1985?
Mr. P. Barry: As regards the question of there being sufficient funds to satisfy farmers under the CAP, I am not sure that there will. The resistance we are meeting over getting a correction in the figures for the milk super-levy is an indication of current thinking at Brussels level. It is only now beginning to dawn on some of the farming organisations in Europe that the deal won by the Irish Government for our farmers was extremely good. Consequently, these other farming organisations are putting pressure on their Ministers for Agriculture to win for them a similar deal.
Mr. P. Barry: It would not be realistic to expect that every demand from the Irish agricultural industry for additional funds under the CAP in the years to come would be met automatically. Where those demands are justified for the development of what is our primary interest they will be taken seriously and we will get the response we deserve as a committed Member of the European Community. On the second point raised by the Deputy, I do not know what the position is. The matter of produce price increases arises in March or April. Perhaps the question should more appropriately be addressed to the Minister for Agriculture. Produce price increases are negotiated within the CAP. The CAP is the agricultural policy of the EC and I have no reason to believe that the Community is any less determined to uphold that policy now than they have been in the past.
Mr. MacSharry: Since the Minister has accepted, and so informed the House, that the CAP expenditure is £900 million short in the draft budget, how can he realistically suggest to Irish farmers that they will be in a position to operate even at 1984-85 levels?
Mr. P. Barry: There is a later question that I will be answering in relation to budgetary discipline. Obviously, it is unrealistic to expect that we can have some sort of blank cheque system to deal with any policy we might wish to put forward. There must be some discipline in the expenditure of the Community just as there must be discipline in the expenditure of finances in this economy and in each Department. We will not have blank cheques that can be filled in for everything we would like in the future.
Mr. P. Barry: We have succeeded in blocking the 1984 supplementary budget and in having the draft budget for 1985 put into place with the promise that whatever gap there may be between that draft budget and actual expenditure for 1985 will be met.
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