Thursday, 26 January 2012
Seanad Éireann Debate
Minister for Agriculture, Food and the Marine (Deputy Simon Coveney): I do not have a script because I hoped this would be a question and answer session which Senators could get as much out of as possible, in terms of getting the information they are looking for. I will try to keep my contribution as brief as I can. We will spend the first hour on agriculture and the next on fishing. One session can eat into the other if that is appropriate; I am in the hands of the House in that regard.
I would like to focus on two things from an agricultural point of view. First, we are going through a very good time in agriculture. The year 2011 was a bumper one. Prices, by and large, were strong, with one or two exceptions. Markets are strong. If one was to measure the success of the agrifood sector in 2011 in terms of exports, one would find 85% of everything we produce has to find a home and buyer outside Ireland. One would have seen 12% growth.
Almost €1 billion extra in food and beverage exports from Ireland was achieved last year, which is impressive. More than one quarter of the total increase in exports from Ireland last year was directly attributable to agrifood. On the dairy side, exports increased approximately 17% last year on top of an increase of 17% the previous year, a 34% increase in the value of their exports from Ireland in two years. The exports include cheeses, milk powder, infant formula, yoghurts, nutritional drinks, ingredients for dairy foods and so on.
In the past ten years, particularly in the past three or four years, we have seen our top dairy companies move away from commodity-based products to become food companies. Such companies include Glanbia, Dairygold, the Kerry Group and the Carbery group. They are now leading names in areas like nutrition, flavours and the development of new exciting products. That is very much where we want to go in terms of the food industry. The basis of that is primary food production from our farms, which need to produce quality, safe, reliable, consistent and sustainable products. That is the driver of all of the current policy direction in terms of efficiency and output. My brief is also about broader rural issues, but in terms of the business of producing food that is what we are about.
The beef sector also grew last year, not in terms of value but volume. A lot of the increase in the value of the food sector and income for farmers has happened because commodity prices for grain, dairy products, beef, lamb and even pigs have increased significantly in recent years. We have an obligation to try to build on the good fortune that we have in terms of commodity prices, which are catching up following a decade of stagnation in agrifood prices during the boom years in Ireland. The irony is that during the golden so-called Celtic tiger period farmers did not do particularly well. Now we are in a recession, European and global demand and food prices have caught up with a lot of other price inflation over relatively a short two-year period and we have seen a dramatic increase in the income of farmers to the tune of between 20% and 30% on average.
Having said that, farming is still quite a low income industry. The average income for farmers is approximately €21,500 a year. One has to take into account that half of farmers or farm families also have alternative incomes. There are not too many millionaires in farming unless they have sold land. Producing food for a living is a sustainable way of life and has become a more exciting business for people to enter. That is why we saw a 27% increase last year in the number of young people studying food science and agricultural science in our universities and colleges, which is a good thing.
Young people are now investing in upskilling and educating themselves to take over farms and become involved in research and development on food and beverages. It is a good sign for the future. We need to deliver for those people to ensure they have a future that is about expansion, efficiency, improving margins, getting more from the marketplace and perhaps relying less on the support schemes that are there, even though those support schemes are hugely important, particularly for certain parts of the country.
This is a sector that is going well. We will have another strong year. It will not be like last year or the year before in terms of this massive increase but if we can maintain a position where prices are strong, although we may have a slight weakening in some areas, particularly in dairy, prices should still remain strong in relative terms. We can concentrate this year on consolidating the gains that have been made over the past two years and work hard to upskill farmers in terms of the margins they make and the efficiency they get into their business.
The second important issue, on which I hope Senators will ask questions, concerns the Common Agricultural Policy. We are at the start of a process of reforming CAP and there is a whole series of elements to that process. From an Irish point of view, some of the proposals that are currently on the table from the Commission are very positive while others are of great concern. Perhaps we can tease out some of those issues, if Senators wish.
There is one really big issue of concern in the current Commission proposals and there are many other issues where I would like to amend and improve what is being proposed. For example, around greening proposals, we would like to see change as we consider that to have 30% of the overall payment being applied to a greening payment is too high. We believe some of the conditions sought need to be more tailored for individual countries rather than being the same for everybody. Applying the same environmental or greening requirements to Cyprus as to Sweden does not make much sense when one is talking about an entirely different type of agricultural structure, a different climate and so on. I would like to see more flexibility in that regard. However, these are issues we will resolve.
There are also issues around the reference year of 2014, with which the farming organisations have concerns, as do many Senators and the farmers they represent. We will find solutions to it over time during the negotiations.
The big issue, however, is the proposal currently on the table for a redistribution of the single farm payment within countries and the fact this is based on an entirely new model from an Irish perspective, which is that it would be a flat rate, area-based payment. This means that instead of relying on historical productivity as the basis for the single farm payment, one simply moves to this blunt model whereby the person gets a payment based on how much land is farmed. Regardless of output from that land, its productivity or the investment requirement linked to the farm, the person gets the same payment. In other words, a person who has 60 ha on the side of mountain, with very low stocking rates in sheep, gets the exact same payment for those 60 ha as a person who may be farming a highly intensive dairy farm in Wexford, who needs to spend a lot of money in terms of upgrading and so on.
This is not in the interests of productivity or of the agrifood journey we want to create, which is around growth and jobs and expansion. We are working with the Commission to try to find a solution. While we will achieve it, it will take a lot of political effort and imagination to come up with appropriate models that are consistent with state aid rules, competition law within the European Union and also broader world trade talks limitations. There are no easy solutions and those who pretend there are such solutions are deluding themselves.
That said, the big benefit of Commissioner Ciolos's visit to Ireland is that he has gone back to Brussels understanding in real detail the Irish problem as regards CAP, in particular this move towards a flat rate, area-based system that treats everybody the same regardless of productivity, whether one is a full-time farmer or hobby farmer or whether one is an intensive dairy or beef farmer as opposed to one who is essentially a landowner who just about qualifies as an active farmer.
What I am interested in doing is working in partnership with the Commission because Ireland will play a crucial role in terms of getting this final deal done. Everybody accepts the CAP final deal will not be agreed by the end of 2012, yet we are all hoping to have a new deal in place and implemented from the start of 2014. This means the deal must be done in the first half of 2013 at the latest. Ireland has the Presidency of the European Union during that period so it is our job to get the job done. We cannot do it on our own, however, and we will need to do it in partnership with the Commission and the European Parliament. I am determined to try to achieve that.
We are making it absolutely clear to the Commission and to other member states that Ireland is serious about putting the resources and effort necessary into getting a compromise that all 27 member states can live with, but also, and most importantly from my point of view, getting a compromise that will take the Irish industry forward in a positive way. We will not sacrifice Irish farmers to get a deal on CAP but, at the same time, we would like to be the country that gets this deal done because we think it is in the interests of everybody, including Ireland, that it is done next year rather than pushing it back for two or three years. Who knows where the EU will be then? Who knows where the political priorities may be then in terms of the allocation of significant budgets to the agrifood sector? There is a political appetite to protect CAP funds and to keep a very significant portion of overall EU funding in the CAP bracket to support food production and to support farmers. While that appetite is there, we need to get the deal done.
If Members have questions on any issue, I will try to answer them. This House can play a very useful role in making a significant contribution towards the review of CAP and, indeed, the review of the Common Fisheries Policy, CFP. Both policies are being renegotiated at the same time and both will I hope come to a conclusion during the Irish Presidency, which is a very significant responsibility in regard to those areas of fishing, farming and the agrifood sector generally, which is the real heartbeat of the economy.
Senator Brian Ó Domhnaill: I thank the Minister for being present and the Leader for facilitating the debate. The Minister has clearly outlined the importance of the agrifood and agriculture sector within the economy. As he said, there has been a 34% increase in exports in the past two years, which was in——
Senator Brian Ó Domhnaill: Yes. In total, the sector is worth €8 billion to the economy and we are exporting approximately 85% of the food we produce in Ireland. The reality is that the economy is in a very difficult position but, through agriculture, we can work to stimulate it. Reports show that every €100 of agricultural output creates at least an additional €73 for the local economy. When we take on board the fact farmers spend about €8 billion on living expenses and agricultural costs, and given most of that money is spent in the local economy, it is clear the benefit of agriculture to the economy cannot be overstated.
The Minister has outlined some of the challenges facing the agrifood sector. There have been huge benefits in terms of the Food Harvest 2020 report which is being implemented and which is trying to achieve the goals that have been set out. The industry is buying into that, including the organisations representing farmers, as are the Department and the Minister’s office, which are working towards those goals.
The big challenge will be the proposed changes to CAP, which go far beyond the current CAP and some of which would almost go as far as the MacSharry reforms of 1992. As the Minister noted, they include changes to the manner in which payments are made to farmers and challenges in regard to greening. At the same time, many benefits and good suggestions are contained within the proposed CAP, in particular in respect of the benefits that might be available to younger farmers. However, there also are difficulties. The 30% figure for greening, as the Minister pointed out, is too high. When the Commissioner attended the committee last week I made the point that perhaps greening should have been funded from the pillar 2 aspect of the CAP instead of from pillar 1. The Commissioner did not agree. A greening element of 30% will certainly affect productivity, in particular among larger farmers.
I take on board the point made by the Minister in regard to the difficulty the flat rate payment will provide within the Common Agricultural Policy. However, we must also remember and never forget that many hill farmers are prohibited in many circumstances from increasing stocking rates because they cannot re-stock on the hills. The Minister referred to one such farmer who has 60 hectares. As a result, they cannot buy additional stock, even though many of them want to do so. I do not believe they should be penalised by any reform in the CAP. For example, if the funding in the single farm payment scheme were to be directed towards productivity we should not forget these farmers, particularly those in severely disadvantaged or hill areas. They must be compensated. We can discuss that issue later during the question and answer session.
The big challenge facing Europe is the financial one. The fact there has been no agreement to date by the European Parliament on the multi-annual financial framework is a cause of concern to farming organisations, not only in Ireland but throughout Europe, especially as to whether we will have that framework in place in time to implement and activate the transfers from the CAP in 2014. Perhaps the Minister might give us his thoughts on that matter.
I will not continue because we will have questions and I do not want to encroach on the time of other speakers. We will get to the crux of some of these matters when we get to questions, including regarding payments currently available to farmers and the reopening of a number of schemes. The Minister may be able to throw some good light on these matters then.
We had a very good week last week when Commissioner Ciolas was in the House and we had the opportunity to put many questions to him. There is a great deal of sorting out to be done but we will all work to try to bring about the best deal possible for farmers in Ireland. I asked a question about young farmers and was particularly happy with the answer I got. They will be very well looked after in the future regime. That is only right because in the past eight or ten years we have seen many young and not so young farmers working without any single farm payment. They continued trying to farm with no single farm payment. One such farmer was featured on the programme, “Ear to the Ground” , a week ago. It is difficult enough to farm with that payment. I can only imagine what it was like to do so, keeping up the interest, with no such payment.
We must consider some measure that will encourage older farmers to hand over their land at an earlier stage. There used to be a farm retirement package for farmers who could retire at the age of 55. There should be some little incentive for those aged 60 to 65 to hand over to younger farmers who are coming out of agri-colleges. These colleges are full of young farmers who will be looking for some place to go to. We should try to encourage the older farmers to hand over that little earlier.
I also welcome the movement towards a flat rate payment. It is very important that farmers in the more disadvantaged or hilly areas should get an increased payment. The average payment has been approximately €10,000 but in my part of the country many farmers would farm with a payment of less than €2,000. Some measure of flattening must be brought into the scenario.
I agree with Senator Ó Domhnaill that many farmers were de-stocked in the year 1997-98 and were not in a position to put stock back on the hills. I know the Minister will look favourably at that. Something will have to be done because it will take a number of years for those farmers to get back in. They will have to breed the stock on the hills and will not be able to buy them in because stock like that simply would not stay there. There were cases like that in Cooley after the foot and mouth disease outbreak. Farmers were not able to make the stock stay and so they must breed them naturally on the hills.
Senator Michael Comiskey: Possibly. At present they cannot do so. The new system must be fair and must encourage people to farm for the sake of farming and producing material, rather than merely for the entitlements. It must encourage young farmers to try to get onto the ladder.
There are a number of other issues I wish to mention although I realise the Minister may not have the answers today. In County Leitrim where I come from, representing the people of Sligo-North Leitrim, there are national issues. The 80 km rule that was introduced in the budget is a little bit of a problem in that area. We would have some of the poorest land in the country and people in the region must lease or rent land outside the area and travel 50, 60 or 70 miles to get to it. They are prepared to do that, many of them being youngish farmers. Some 60 people in County Leitrim are doing that kind of travelling and they must be catered for. They are based in and spending their money in County Leitrim but they move out for this. The option is to buy cereals and feed the stock indoors or rent the bit of better land where they can produce better lamb or beef.
Stocking density is another small problem. I know the Minister will consider this in respect of the commonage areas where people were not allowed to build up their stock. There are hardship cases where people may have been affected by TB, or other reasons, and were not able to have the necessary stock in 2011, at point 3 of the programme. We will continue to work on that issue.
Another point, which is very important in my part of the country and which was touched on earlier, including by the Minister, is the greening or agri-environment options scheme, or AEOS. The old REPS did the greening business for us. In the future, if an AEOS scheme is in place, it will do some of that work for us.
Before I move away from the subject there is the issue of pillar 2 in the rural development programme. There could be food processing industries in place. It is possible that in County Leitrim we lost jobs to County Cork because of a technicality that existed. People could not draw down a grant to produce food and we lost jobs. We do not begrudge them to Cork but we could do with them in Leitrim. It would be worthwhile considering this under the Leader programme and have people able to draw down a grant for food production in different areas.
Senator James Heffernan: I welcome the Minister to the House and thank him for the comprehensive briefing. As many Members know, the agriculture sector is hugely beneficial to local rural economies. The contribution made by farmers cannot be overestimated. Farming and agriculture are the life blood of rural Ireland. The Minister stated one will not see many millionaires farming and that is true. When one considers the number of man hours and work time that goes into the industry one can see how labour intensive it is. One starts at the crack of dawn and, at this time of the year in particular, one can be up at all hours of the night, with cows calving and so on.
I wish to speak about the growing relationship Irish agriculture has with the emerging economies and the opportunities that exist, for example, between this country and a place such as China. Last year, after the visit of the Chinese Minister, the Minister stated:
The Minister also referred to combining the strengths of the Chinese agricultural market with the technological expertise of the Irish farming community in order that both countries would benefit. He specified animal husbandry, food safety and fisheries as areas in which we could do business. I would like to ask a few questions about this because a return trip is planned for later this year. What is the Government doing to encourage Chinese investment in the food industry, given its potential? Are Chinese food companies seeking a foothold in the European markets by setting up in Ireland and using it as a base? Are they looking to expand their expertise? If so, what opportunities are available to offer education and training to Chinese farmers and food producers?
With regard to CAP reform, the Minister said the proposals suggest that the individual historic reference to the single farm payment scheme will be replaced by a regional model rather than using national averages. He also said that there is not a great deal of support among member states for the retention of the single farm payment model used in this state. He is seeking as much flexibility as possible for member states to determine payment models based on the individual needs and conditions of the farming system. Perhaps the Minister will provide use with a progress report on the proposal for us. I thank him again for his time.
Senator Trevor Ó Clochartaigh: Cuirim fáilte roimh an Aire. I would like to raise a number of issues in this debate, which I welcome. I echo Senator Comiskey’s thoughts on the flat rate payment, as it could be positive for small rural farmers. There are two types of farming. Farmers engaged in industrial type production are doing reasonably well and driving export-led growth, which is welcome, but many small rural farmers are living below the bread line, earning less than the average industrial wage. They also need to be supported by the Government’s policies. Some of the Commission's policies favour this group and I hope the Minister does not sway too far in favour of large industrial farming units. We need to help rural communities to remain vibrant.
I am interested in the Minister’s reference to hobby farmers. We have a different perspective on that in the west in that farmers have a number of income streams. Some depend on a combination of farming, fishing and other work in the locality and we do not call them hobby farmers. We should not lose sight of the fact that this is the integral part of the fabric of the society——
I refer to the issue of branding. While exports have increased, much of the prime beef is used for burgers in McDonalds restaurants throughout Europe. Surely there is a great deal of scope to enhance the value of these products. Where does the Minister stand on the branding issue and increasing the value of grass-fed beef? I refer to the pathways for growth project mentioned by Bord Bia. I agree with the call for including food production under the Leader programme. The failure to include it has held many good projects back and if that could be alleviated, it would be positive.
Another issue having an impact on small farmers is the necessity for a licence to pull a trailer with a car. Many older farmers did not have a licence to do that and because the regulations were amended recently, this is causing problems in rural Ireland. Those who do not have the correct licences are being asked to re-sit tests and so on. Will he examine this issue in conjunction with the Minister for the Environment, Community and Local Government?
I get the sense that the Minister is pushing for the agriculture budget to be retained on an EU-wide basis. I picked up from Commissioner Ciolos that he will have a battle on his hands at governmental level to maintain his budget. He also mentioned the paperwork people who apply for funding sift through but he indicated that, much of the time, the Commission is not on its own seeking information as members states add a list of questions regarding information they are seeking. Is the Government a culprit in this regard or is this practice confined to other member states? If the information has to be sought in one member state, I expect it has to be sought in every other. Has the Minister added to the paperwork?
Senator Pat O’Neill: I welcome the Minister and congratulate him on protecting the agricultural community in the budget. When quotas, especially milk quotas, are abolished in 2015, milk could become the driving force in the agriculture industry and with more farmers going into milk production, we may experience a major drop in the beef herd, suckler herd and sheep flock. Will he put measures in place to ensure meat production is maintained?
The health committee debated below cost selling of alcohol, particularly in supermarkets, earlier this week. However, it costs approximately €158 per tonne to grow potatoes whereas the price in shops equates to €130 per tonne because the three major retailers control 80% of the market. Some farmers are accepting €70 a tonne in order that they will not have to store potatoes. This is not sustainable. Will the Minister put measures in place to protect potato growers?
I do not agree with Senators Comiskey and Ó Clochartaigh regarding the flat rate payment. I agree with the Minister that if we are to push on with production under Food Harvest 2020, it has to be done on productive land and a flat rate payment would not suit. I wish him all the best in the CAP negotiations over the next year and I am sure he will do a good job. He knows his brief and he will make sure to defend the agriculture industry.
Senator Mark Daly: I welcome the Minister. The area applied for permission for afforestation in 2011 was 38% lower than in 2010. Is he aware that the change made by departmental officials directly contributed to the decline and, as a result, vast areas of productive land were excluded? The grant and premium rates were also cut and severe restrictions were put on the area of land allowable. Other issues are also under the control of the Department, such as acid sensitive areas, hen harrier designation and farmer status. What does the Minister believe has caused the decline and what steps does he intend to take to remedy it? If afforestation has decreased by 38% in one year, something must be seriously wrong. There are people who want to plant land in areas of counties Cork and Kerry, for example, but we are down 38% because the unenclosed land has been cut out for grants and rates.
Senator Tom Sheahan: I welcome the Minister and thank him for giving us his time. He referred to exports and companies such as Kerry Group and Glanbia. I ask him to put more emphasis on indigenous artisan food companies which cannot access credit. Grant aid for such companies is very limited and anything that is made available comes with the caveat that 50% of the funding must be provided by the companies concerned even though they are unable to get the necessary funding from banks. They are unable to complete the cycle for this reason.
Young farmers have to be protected within CAP. The hobby farmers mentioned by Senator Ó Clochartaigh, or slippers farmers as I believe they are also known, are the individuals who sit inside looking out at their land while doing nothing to it. Productive farmers will have to be protected, however. Clarity and security are needed in respect of the reference year of 2014 because farmers will not invest if they do not have confidence in their future. As the Commissioner for Agriculture and Rural Development, Mr. Ciolos, was a rural development officer in his former life, Pillar II will be very important to him. The Minister will have a tough fight on his hands but I have every confidence in him.
The only question on forestry concerns unenclosed land. The issue of acid sensitive areas has been addressed in Sweden and it can be managed here with further science. I commend the Minister on the issue of forestry. His ministerial colleagues want to know how he managed to juggle the figures for the budget because he did an excellent job.
Senator David Norris: Senators may be surprised to find I am interested in farming but my grandfather was a farmer and my maternal ancestors had land in County Laois for many centuries. I compliment the Minister on the work he has been doing and I am glad the Government has negotiated some improvement in fisheries. Like other Senators, I received a document from the IFA which showed that farm incomes have increased. I welcome this increase, which farmers have needed badly for a long time.
My question pertains to free range pig farming. A couple based in the Minister’s constituency run a very good business supplying free range pork. However, a difficulty has arisen in regard to labelling. Can anything be done about this issue? I understand that a business can register the description “free range pork” as a trading name and its products can be sold in supermarkets as free range pork simply because it is produced by a company with that phrase as its registered business name. Is it possible to introduce regulations to define what can be described as free range? The best definition is that given by the aforementioned husband and wife team, whose name I cannot recall. They allow their animals to range freely out in the open, with access to food and shelter as necessary, and the quality of their meat is significantly different as a result. If something can be done about the issue through regulation, it would be welcomed by this valuable niche industry.
The advisory group established by the Minister to deal with the thoroughbred horse industry is very successful but in light of the important role that show horses and half-breeds also play in the countryside, is it his intention to establish a similar advisory group to deal with this aspect of horse breeding and does he have other plans to develop its potential?
Senator Mary M. White: I wish to raise a serious human rights issue. In the context of the Government’s plans to introduce a Bill providing for a quota for women standing for election, I draw the Minister’s attention to a misogynist organisation called the ICMSA. Its council comprises 93 members but there is only one women on it. In contrast, the IFA has implemented an equality agenda under which at least 25% of voting delegates at county level are women and it goes out of its way to ensure women are included as voting delegates. As wives and partners, women are the backbone of a dairy industry that produces exports worth €2.6 billion. Why was an unjust act committed against Eileen Callanan, a dairy farmer in west Cork?
Senator Mary M. White: I raised the matter in the Seanad last week, when I asked the Minister to investigate the lack of democracy and transparency in the ICMSA’s recent elections. Three years ago a gentleman was allowed to vote under exceptional circumstances but when this young woman attempted to do something similar this year, she was prevented from doing so.
As someone originally involved in a small food business and now in a large food exporter, we must pressure the dairy industry to diversify away from the UK. It is not good enough that 41% of food and dairy exports go to the UK. The industry will have to look to China, India, Russia and South America. The Minister has to drive that diversification. I commended the Tánaiste on the reception he held as part of his efforts to reach a trade agreement between Ireland and Russia. However, while it is lovely to go to receptions and trade fairs for canapes and glasses of wine, it takes a strong stomach and shoe leather to increase sales. Increased sales will create more jobs. I want to see the food and export industry get out of that sheltered area of Britain. I am not saying we are not appreciative of the British market, but we have to reach the hundreds of millions of people who are living out there in India and South America. I am relying on the Minister to get democracy into the misogynist ICMSA. I will watch this very carefully. It is my duty here to promote the role of women in society.
An Leas-Chathaoirleach: I have noted that. Senator Brian Ó Domhnaill has already spoken, but he says he has questions. Senators Walsh and MacSharry were to ask questions on agriculture but unfortunately, they cannot be here. It is up to the House whether Senator Ó Domhnaill will be allowed to ask a couple of questions on their behalf. Technically, he cannot speak again.
I ask the Minister to indicate whether he is reopening the agri-environment options scheme, AEOS. He indicated last week at the IFA AGM that he would consider opening it on a limited basis. That would be welcome in Donegal and on the west coast, provided that commonage land and natural heritage areas are eligible, along with special areas of conservation; that mountain-type land that would not be included is also eligible for payment; that the restriction on feeding concentrates to sheep during lambing season on species-rich grassland is removed; and that the commonage and SAC payment is increased from €75 to €150, as I mentioned the last time we had questions and answers here. In addition, can consideration be given to increasing the maximum payment generally, not only for new applicants but also for existing recipients, from €4,000 to €5,000?
When will farmers receive their payments for 2010? The Minister might also outline the changes that have been made to the disadvantaged area payment scheme, which will have drastic consequences for farmers who are in commonage frameworks and so on. He indicated last week that he intended to introduce a number of changes, some of which I have read about. In particular, we need to examine stocking rates on SAC land and NHA land, and the situation of those who are in the rural environment protection scheme or the agri-environment options scheme or within the confines of a commonage framework plan.
Deputy Simon Coveney: As I am anxious to answer as many of the questions as I can, I will try to be quick. If there are some detailed questions I cannot answer, I will correspond bye-mail with the Senators.
First, I want to clarify a number of things about the new eligibility criteria for disadvantaged area payments. It is important that people know what we are talking about here, because there seems to be a misunderstanding. We acted as we did because we worked with farming organisations, farmers and all sorts of stakeholders to try to come up with a way of saving money under the disadvantaged area payment scheme, because we had to find money somewhere. We have managed to reduce the cost of running my Department and its agencies by €18 million in one year, but it was not enough. We had to find money from somewhere else, and there were only two schemes we could consider making savings from. One was REPS, which was a very successful but quite generous scheme, and we have made savings there. Farmers are not happy about it but they understand why we have targeted that area. The other was the disadvantaged area payment scheme. Targeting AEOS, which already involves low payments, would have been impossible.
I said to farmers that I would do everything I could to ensure I did not touch the rate of their payment or the amount of land on which they could apply for a payment, which is currently 34 hectares. In other words, active, practical farmers who are farming to a reasonable stocking rate and are keeping their stock for a reasonable amount of time in the year would not see any reduction at all in their payments. That is what we were trying to do. There are certain people who have very low stocking rates and are keeping their stock for the bare minimum time, which was three months of the year, who really are not farming at all; they are putting stock on land in order to draw down payments. We wanted to ensure that the limited money we do have was given to farmers who are actively farming and making an income from farming. In an effort to do that, we decided to change the eligibility.
The stocking rate required to qualify for a disadvantaged area payment was incredibly low, at around one sheep per hectare. We have doubled that now and asked farmers to have two sheep per hectare, which is less than one sheep per acre. This is still a very low stocking rate. We also said that instead of having to keep their stock for three months of the year, farmers would have to keep their stock for six months of the year. In other words, farmers would have to be farming. We could not have a situation in which people were swapping stock in order to qualify, with stock spending three months here, three months there in order that two farmers could qualify, and so on. What we are saying is that as we have a limited amount of money to spend, let us give it to the people who are actively farming and who need that income the most. That is what we have done.
Certain categories of people who may be vulnerable as a result of those changes, including people who are required to have a low stocking rate because they are in a commonage framework which does not allow high stocking rates, will be exempt from the changes. They still qualify, there is no change for them. Let us be clear on that. People who are farming in commonage areas, particularly in the west and north west, and who have had low stocking rates enforced on them by the National Parks and Wildlife Service or my Department in an effort to protect the environment, will continue to get disadvantaged area payments, uninterrupted, regardless of how low their stocking rates are.
For people who have genuine reasons for having a low stocking rate in 2011 — if, for example, there was a death in the family or a disease in the herd, or a young farmer was taking over and had stock for only four months of the year rather than six months — we will establish an appeals mechanism which will make relatively quick decisions, although obviously all cases must be examined. I have given an assurance to farmers — I mean it — that we will take a progressive approach towards that appeals mechanism to try to support people who are genuine farmers. However, we cannot have a situation in which people see a change in the rules and buy in an extra sheep to try to qualify all of a sudden. As we have to make some savings, we cannot allow people to simply change the way in which they manage their stock in order to continue receiving payments.
I have agreed with the Minister for Arts, Heritage and the Gaeltacht, Deputy Deenihan, that our two Departments will examine the commonage framework programmes. In many mountainous areas, we are actually undergrazing land, which is doing as much damage as overgrazing. If a hillside is undergrazed, elements of growth on that hillside will make it unfarmable in the future, and ultimately, mountainous areas that would previously have been managed through grazing by hill stock will be taken over by aggressive weeds. As undergrazing does as much damage, potentially, as overgrazing, we need to reassess some areas and increase stocking rates to improve management of that land.
This represents a commercial opportunity for farmers. An exodus from hill farming is the last thing I want to see. I am not going to punish those people either in terms of single farm payment allocation under the CAP or in terms of disadvantaged area payments or other mechanisms under pillar 2, which pertains to rural development.
There is a distinction between pillar 1 and pillar 2 in terms of direct payments and rural support mechanisms in the CAP. Single farm payments are primarily intended to support sustainable, safe, environmentally friendly and efficient food production. The scheme recognises the fact that European farmers must operate within restrictions that do not apply to farmers in other parts of the world, and as taxpayers who demand those standards from our food producers, we need to pay for that. That is the primary basis for direct payments. This is not unusual in other parts of the developed world. Every country in the developed world, with the exception of New Zealand and possibly Australia, has mechanisms to support primary food production, and Europe is no different.
The primary focus of direct payments is on supporting food production in areas of high and low productivity. We are to see a redistribution of single farm payments. The question is the level of redistribution. What I am saying to farmers is that the current proposals wouldmean the most productive farmers would lose an average of 60% of their payment, while farmers in less productive areas would gain an average of approximately 85% in their payments. This level of switching resources will significantly damage the productivity of Irishfarming in terms of the capacity of the productive sector to invest and expand as we would like it to do.
We need to change but the idea that the status quo remains intact, whereby the most productive farmers continue to receive the extremely high payments some of them do versus less productive areas, is not acceptable either. The idea that in 2019 single farm payments would be based on productivity in 2002 and 2003, on which the current single farm payment is based, is also a nonsense. Some redistribution of these funds is necessary and we are trying to put in place a mechanism which will allow for this without a massive resource shift from the productive sector to the less productive sector.
We have submitted proposals to the Commission, and the Commission has made a proposal based on a redistribution of direct payments between member states because historically some countries have done much better than others. Many countries joined the European Union halfway through the last CAP process and do not have the same level of direct payments as countries such as France, Germany and Ireland. The Government worked hard with the Commission to put in place a formula to calculate who is doing well and who is not doing well and how EU moneys might be redistributed between member states to ensure everyone gets a slightly fairer deal.
The formula divided the national envelope of direct payments received by countries by the eligible hectarage in those countries and calculated the average payment received by countries. Everybody over the average is doing better and everybody under the average is not doing so well. The formula the Commission has on the table in its proposals is for approximation, which is to move everybody towards the average but not equality. It would mean everybody under 90% of the average payment would be moved towards 90% of the average figure by one third and this would be paid for by everybody over the average. This is not about bringing everybody to the same payment because the cost of farming in some countries in the European Union is not as expensive as in others with regard to the cost of labour, inputs and machinery because of how those economies have developed historically. However, we are moving everybody slowly in the direction of the average.
If we used the same philosophy with regard to the distribution of the single farm payment in Ireland it would mean a redistribution but instead of the productive sector on average losing 40%, 50% or 60% it might lose 10% or 15% and instead of the less productive sector gaining 70%, 80% or 90% on payments it may gain 20%, 30% or 35%. This is the type of compromise towards which we are trying to work and it can be sold to both sides of the equation, including those farming in less favoured or disadvantaged areas.
The alternative, which is what the Commission would like us to do, is that we use flexibility to break up the country into various regions which would receive differing flat rate payments.  Will Senators imagine the political challenge of trying to break up Ireland into 20 or 30 regions with each region receiving a different direct payment based on geography? It would be impossible and would cause civil war throughout Ireland.
Deputy Simon Coveney: Actually Cork would probably not do so well. Cork is a county which reflects the country in many ways because it has disadvantaged areas as well as very productive areas. It is an interesting case study.
We have made a clear case to the Commissioner that what he proposes would not work in Ireland and we must come up with a way to limit the redistribution to ensure it does not damage our aspirations and ambition in the Food Harvest 2020 targets.
A number of Senators have asked about the agri-environment options scheme, AEOS. To be absolutely clear I would love to be able to introduce a new REPS that would be generous and encourage environmental and sustainable farming but I cannot afford to do so. We do not have the money to do it. When one must make choices with the money one has one must choose the key areas to which one allocates one’s resources to obtain the maximum dividend from an environmental point of view or from the point of view of whatever other target one sets. I do not have the money to put in place a full AEOS for all farmers leaving REPS at present. If I find the resources to do so in the meantime I will happily re-examine it but what we are trying to do is introduce a limited AEOS.
This year may well be about drawing down payments next year, but limited to the areas which need priority treatment which are special areas of conservation, SACs. Someone farming in an area with a series of limitations because it is a special area of conservation, which include determining the amount of fertiliser one can use and one’s stocking rates, must be compensated for this. We are trying to put in place a limited AEOS, which will not be as generous as the previous REPS but at least will be an acknowledgement that those farming in special areas of conservation must have some preferential treatment in terms of support schemes put in place. This is why in AEOS 2, which I put together last year, those in SACs automatically qualify. Those outside SACs will qualify if they are under the ceiling in terms of the number of applicants.
I am not in a position to promise any more than this but the Department will try to follow through on my commitment to put together an AEOS for SACs. It may not be sanctioned by the Department of Finance because it does not like new schemes because they cost money and will continue do so; it is not about only one year. We will try to put it together and I am reasonably confident we will be able to do so. However, we must find savings elsewhere to finance it.
Another question I wish to answer, because I do not want to return to the matter of the disadvantaged area payments scheme, is on the 80 km rule and farmers in disadvantaged areas trying to expand their productivity by leasing land outside of the disadvantaged area. If one’s primary farm is in a disadvantaged area, leasing land in a non-disadvantaged area will not impact on one’s payment. I clarified this recently at the AGM of the IFA. If one’s primary farm is in a non-disadvantaged area and one leases land in a disadvantaged area to obtain payments, one will receive a percentage payment based on the percentage of the overall land holding which is in the disadvantaged area. Someone outside the disadvantaged area taking land for perfectly valid reasons in a disadvantaged area is not in the same category in terms of being a disadvantaged farmer as someone whose entire holding is in a disadvantaged area. This is why these changes have been made and they were worked out while listening to the concerns of farmers.
I take Senator White’s point on male dominance in some organisations. To be perfectly honest I cannot answer on behalf of the ICMSA. I am not familiar with the case and it would be dangerous for me to start making comments.
Deputy Simon Coveney: I agree with Senator White on the role of women in farming. I made a point of speaking at the women in farming conference organised by the IFA last year. To be perfectly honest it was a fantastic conference and a very good experience and I got much good feedback from it. All of the research on women’s involvement in the running of a farm business shows if two business partners — a man and a woman — run a farm, the productivity and profitability of the farm is significantly higher than if there is not.
Unfairly, I have got a bit of stick about the advisory group on horse racing. No one on that committee is paid anything, be it expenses for mileage or so on. Its members are entirely voluntary and we meet every second month or so. I put the advisory group in place because horse racing was one of the areas in my portfolio about which I was not comfortable I had detailed knowledge. I am comfortable in most of the other areas and am becoming more knowledgeable on horse racing, but I felt the need to put in place a group of people I trusted who understood and were stakeholders in the industry. I take advice from them and they supply it when I ask for it. That is all they do. It is a good group and I thank the key people for being on it. They are great and are committed to their sector.
I probably know a great deal more about sports horses. I often clean out stables on a Sunday afternoon when my wife is out on her horse or my daughter is out on her pony. The sports horse industry is very valuable and is worth approximately €700 million to the economy each year. Unlike racing, and unfortunately from my perspective, my Department does not have primary responsibility for it. Rather, sports horses are covered by the Department of Transport, Tourism and Sport. It would be helpful if the responsibility for sports horses was in the same Department as the responsibility for race horses, but this matter must be worked out within government.
In April I will visit China, which is an important market for us. My counterpart has visited Ireland and we signed a memorandum of understanding on new trade and investment opportunities, which are progressing. Our relationship with China is very much about that, namely, relationships, and personalities trusting one another. It is a different type of economy and political structure on which to make an impact than, for example, the US. Great efforts are under way in this regard. The Deputy Premier of China, an influential and powerful politician, will visit Ireland from 18-20 February. Ireland is the only European country that he will visit. He will travel from the US to Ireland to Turkey before returning home. It will be a significant visit. He is likely to be the next Premier of China, arguably the most powerful politician in the world.
I am familiar with the sugar beet industry. My family farm used to produce sugar and I used to deliver much of it to what was then the Mallow factory. There may be a future for sugar production in Ireland. Due to a demand and supply problem, the price of sugar rocketed last year. A rough rule of thumb is that, as long as processed sugar stays above €500 per tonne in global pricing, producing it in Ireland is viable in terms of farmers getting the returns they need. When it falls below that level, making a commercial case becomes more difficult. The current price is more than €600 per tonne. It was between €700 and €800 for most of last year. I hope that once we pass beyond the current system of sugar quotas, which is due to end in 2015, opportunities will open up for Ireland.
Deputy Simon Coveney: I will. People probably know my views on protecting the suckler herd. I have maintained the suckler cow welfare scheme despite the pressure applied by many people to get rid of it. I do not want to allow the beef sector to become a by-product of the dairy sector, which will be a danger as excitement around the dairy industry grows in the lead up to 2015 when milk quotas will vanish. Milk prices will remain strong in the meantime. Half of Irish beef comes from the suckler herd and half from the dairy herd, but nearly all of the top quality beef comes from the suckler herd, in which case we need to try to keep suckler farming intact. We have a major job to do in upskilling suckler farmers so that they can make more money from the marketplace and be less reliant on schemes. For this reason, I have set aside €5 million to put in place a beef discussion group model, whereby we will bring suckler beef farmers into a room and discuss with them how they can upskill and get more out of their businesses. I might revert to people regarding the——
Senator Denis O’Donovan: I acknowledge the sensitive and compassionate way the Minister dealt with the tragedy off Glandore. He showed an interest in the situation. I was present a few evenings as well. I hope the other two bodies will be found in order that some closure can be brought to the matter for the community. I acknowledge the tremendous voluntary efforts of the community.
I will ask a number of questions, as I do not want to make a long statement on fisheries. The Minister might indicate whether he or his Department intends to revisit the 2006 fisheries Act with a view towards introducing administrative sanctions. The issue was a millstone around my neck while I was a Deputy. In the last Dáil, some Fine Gael Deputies gave a commitment to revisit the Act and to replace the criminal sanctions with administrative sanctions, if possible. Will the Minister assure me that, where administrative sanctions are concerned, the cure will not be worse than the disease? Some of them might not be exactly what the fishermen want. The Minister need not answer today, but the matter has been on my mind.
The then Minister for Communications, Marine and Natural Resources, Noel Dempsey, revoked the wild salmon fishing licences by statutory instrument. Some fishermen were compensated. In some quarters, commitments were also given — I do not know how sincere they were — to the effect that, after five or six years, the situation would be revisited. It is good news to see that salmon stocks have greatly recovered. Is there some way to grant wild salmon licences in a regulated fashion? If the science is against it, I will understand, but the commitment was that everything would be rosy in the garden were there a change of government.
In the House, I wished the Minister well in his pre-Christmas negotiations on total allowable catches and so forth. I have said this privately as well. I congratulate the Minister on his achievements as it is an ongoing see-saw battle each year for whatever Minister is in office. Historically, we all wear the green jersey when we go to Europe, including Members from the Opposition in the previous Dáil and Seanad, and even the fishing organisations praised the Minister for his efforts.
One of the great success stories has been the recovery of herring in the Celtic Sea. Five or six years ago there was little interest from many boat owners because of a depletion in herring stocks and there was not much money to be made. We must credit organisations and fishermen for allowing the recovery, which was industry-driven, as the Minister would acknowledge.
I am concerned about a number of areas. The Celtic Sea herring issue might be like the miracle of the loaves and fishes, so will the Minister give priority to the boats with a track regard in the area, especially in 2008, 2009 and 2010? In so far as is possible, will the Minister provide regulations in order that the boats fishing the Celtic Sea herring land those fish in the Republic of Ireland? The Minister will be aware that a few years ago we had 16 processing plants but we now have four: two in west Cork, one in Dingle and one in Rossaveal. What is important is continued supply when we talk about jobs through fishing. I know from an interest in fishing that some vessels land frequently in places like Castletownbere, Dingle, Rossaveal or Baltimore, and there is a continuity of supply. For the 12 or 14 weeks involved, there is also a continuity of employment, which is very important. I would like the Minister to be mindful of that when he comes to his decision. It is critical to support the jobs on the shore.
Will the Minister ensure that some of the larger oceangoing vessels in the fishing fleets are not allowed to come in to rape the Celtic Sea? I should be careful using that word. It took several years to build up stocks and there is no guarantee that in three or four years there will not be a return to the 4,000 or 5,000 tonne limit. We should carefully monitor Celtic Sea herring and ensure that those who stuck with that stock and depended on it for many years are not excluded to the benefit of the super-trawlers. I know the Minister has a difficult job trying to keep everyone happy but he should be mindful of the reference years, like those in farming.  The reference years for the Celtic Sea should be 2008 to 2010, and the boys fishing out of Dunmore East and Wexford should see fair play.
I have a particular interest in the mariculture and aquaculture industry, and the Leader has said there may be a debate on this before Easter. I have criticised previous Ministers on my own side in the past ten or 15 years — I have been in these Houses for many years — because a proposal was put forward in the early 1990s for mariculture and aquaculture to reach certain targets. That would have created many jobs onshore and produced value-added products such as mussels, farmed salmon or oysters. Unfortunately, for different reasons we seem to be standing still, having peaked in the mid-1990s. I am not sure what can be done but the Minister might offer a brief comment — not necessarily today — on the area and how jobs can becreated.
One of the big challenges facing the Government is the creation of jobs and there is a potential along our shore. Nevertheless, there is a notion of waiting six or seven years for an aquaculture licence. It is something the Minister has inherited and I blame previous Governments. This issue should be dealt with more efficiently and we could create 200 or 300 jobs in west Cork, Kerry, the west in general, Waterford or Wexford. There is potential but something is clogging the process and we are not moving forward. We have not reaped the rewards in the way places like Scotland, France, Norway, Chile and others have. We seem to be standing still rather than making progress.
Senator Michael Comiskey: I am learning the brief on the marine and over Christmas I learned quite a bit. There was very good news before Christmas when the Minister announced the large increase in quota. That has brought its own problem, which the previous speaker mentioned. I had a meeting with some of the people who work the Celtic Sea and the west coast over Christmas and they indicated they had managed fish stocks in the Celtic Sea over the previous years, and with the increased quotas, large boats are now coming from outside the area, taking huge catches. That is affecting fishermen’s livelihood. I was told it could be possible to increase the number of jobs in the factories along the west coast and in the south if the boats with a tradition of fishing in those areas could be given the quota in preference to the larger vessels. Perhaps that could be considered, and I believe a paper has been sent to the Minister from those people, and I have done likewise. It is the same as a farmer on a commonage or hill area with a quota but somebody being able to take it from that farmer. It is a significant issue.
There is much potential for salmon farming off the west coast, as the Minister has mentioned before. It could create a significant industry. Many of the boats which fished the herring and mackerel took the catch to Norway and France for processing, which took jobs away from this country. It is important to create those jobs here, as we need them badly; therefore, we should focus on the issue.
Senator Trevor Ó Clochartaigh: I welcome the debate and concur with many of the points made by the previous Senators. Some of them were made at the presentation yesterday by Iascairí Intíre Éireann and the seafood producer groups. I hope the Minister will not follow in the footsteps of previous Administrations, because we have seen a very lopsided approach to the distribution of quota in this country over recent years. It is difficult to see what benefit has accrued from this to the country because a small number of huge ships have taken much of the mackerel quota, decimating the smaller fishing industry along our coast in the process. Even a slight adjustment would do, as Senator Comiskey mentioned, which would create a livelihood for many people on smaller boats along the west coast, who will land in the Republic of Ireland and keep fish producers and factories working. There is much evidence pointing to that.
I echo the calls with regard to the Celtic Sea, and the Minister might consider changing the proposals per boat of a 5% catch in recent years to something like 35% of quota in the past two or three productive years. That benchmark should be used for active fishing boats in those areas in order that the people really fishing the Celtic Sea would get the benefit.
Is it possible to consider a derogation for the inland fishermen who have boats smaller than 50 m long, as suggested by the TASTE Council? It could be like an artisan fishing fleet in order that the smaller boats can fish all species within a number of miles of the shore. That would rejuvenate rural communities throughout the country and bring in jobs that we need. We must consider the overfishing of lobster, which was also highlighted.
I congratulate the Minister on granting licences for mussel farming in Killary Harbour. The policing of the licensing regime has been raised, as well as administrative sanctions in the Fisheries Acts. It is essential that the issue is revisited in order not to criminalise fishermen around our shores. Tá neart ceisteanna eile a chuirfinn dá mbeadh níos mó ama agam ach, faraor, sin sin.
Senator Paschal Mooney: My question crosses agriculture and fisheries but first I echo the welcome to the Minister, who has yet again come to the House, and the clarity he brings to this whole debate.
I echo Senator David Norris’s concern about the pork issue, to which the Minister responded by saying he would contact Bord Bia. The “Ear to the Ground” television programme dealt with it earlier this week. It seems to be a very specific Government obligation to define what is and what is not organic pork and, as a result, we are perhaps losing potential markets.
I wish to pick up on the comments made by my colleague, Senator Denis O’Donovan. Can the Minister give some indication of his policies on value added in the fisheries industry? This issue has been around for quite some time. I have always been of the opinion, and there is a widespread perception, that as a food producing nation, we are soaring ahead with exports but the Central Statistics Office——
Senator Paschal Mooney: I understand. I am setting the context for the question. Food exports seem to be relatively small in comparison to computer services and chemicals. I know about Food Harvest 2020 but it seems there is very real potential here.
Senator Paschal Mooney: In that context, does the Minister believe there is a need for some sort of focused group which will look at how we can develop value added fish products? As Senator Denis O’Donovan said, this seems to have been lying there for several years. Although the intention seems to be good, the execution of it is certainly questionable.
Senator Imelda Henry: I welcome the Minister. My question is on salmon fishing on Lough Gill and I will give a little bit of background information. Tourism is of particular importance in the Sligo area and, as we all know, the county has outstanding natural beauty and is very suited to the promotion of a wide range of outdoor pursuits to attract tourists. One such activity is angling. The county has two major salmon rivers, the Ballisodare River and the Lough Gill and River Bonet system. These have the potential to attract a considerable number of overseas and Northern Ireland anglers and it would certainly benefit tourism generally.
What can be achieved in this area of salmon fishing is clearly seen in the Moy catchment area of County Mayo where angling is regarded as probably one of the main tourist attractions. Unfortunately, salmon fishing on the Lough Gill and Bonet River system, which enters the sea in Sligo town through the Garavogue River, is now seriously restricted in order to facilitate the recovery of stocks.
This reduction in salmon stocks is a reasonably recent occurrence in terms of the long history of salmon fishing in Sligo. A report from the mid-18th century referred to Sligo salmon being caught in nets in the bay as reckoned to be the best in Ireland. This activity of fishing, by way of nets, was continued well into the middle of the 20th century where the fishery was owned by the Wood-Martin family and operated as a commercial venture with up to six men employed full-time during the salmon season operating the boats which stretched the nets across the mouth of the estuary of the Garavogue River right into the heart of Sligo town.
Senator Imelda Henry: This has resulted in great annoyance and, indeed, dispute among long-term anglers, almost three quarters of whom will not be entitled to take a single fish in the current year. All of this has caused ill-feeling and failure to reach agreement as to how the available 15 gill tags will be distributed.
Senator Imelda Henry: There is already a good example of what can be achieved by a serious scientific study of a salmon river system, which was implemented on the Ballisodare River. A similar study of the Lough Gill and Bonet River system would be of immense encouragement to local anglers and would indicate the urgency with which the angling and tourism potential of this important salmon river is being tackled at national and regional levels.
Senator Brian Ó Domhnaill: Will the Minister give an overview of the review of the Common Fisheries Policy and the discussions taking place at EU level in that regard? The inshore fleet, in particular vessels under 15 m, are finding it difficult in many inshore bays due to outdated by-laws. For example, trawlers coming into Inver Bay in County Donegal are tearing up the habitat of local species and are causing damage to fish farms. The implementation of a by-law dating back to 1875 would impose a fine of two shillings and six pence on those trawler owners. Those by-laws are outdated and I have spoken to Inland Fisheries Ireland and the Sea-Fisheries Protection Authority, which indicated that the by-laws need to be updated. Will the Minister consider updating these by-laws to give protection to local inshore fishermen?
Senator Fidelma Healy Eames: We are delighted with the work the Minister is doing. He is really thorough and his interest is very obvious. My first question relates to his big project, the organic salmon project off Inis Oirr. I received a proposal which I sent to the Minister from some small fishermen keen to invest in it. I know Bord Iscaigh Mhara is going all over the world to try to get investors but would the Minister allow Irish fishermen or coastal communities to invest in it? It is a great sign of confidence. There is an issue of fish lice there and the concerns of those on Inis Oirr who will see this project from their island, yet they will not be able to benefit from it because of their issues with the pier and the breakwater.
My second question relates to the oyster fishery in Clarinbridge which, as the Minister knows, is world famous. It is doing great and has considerable exports but it is not getting enough dredging licences because of a new birds and natural habitats regulation. If the fishermen cannot dredge the bay, they will not renew it and the oysters will not grow properly. They are happy to engage in any fishery management plan but I agree with them that it was a bit unfair that the day they were refused the licences was the day they were asked for the fishery management plan. They have no difficulty with consultation.
Does the Minister’s China memorandum on trade and investment extend more broadly than food — agriculture and fisheries — because I am involved in a China-Ireland initiative and we believe that what is needed is bilateral investment between Ireland and China — government to government because, as the Minister said, it is a hierarchical society — and to attract foreign direct investment into Ireland.
Senator Maurice Cummins: On a similar theme, which was also raised by Senator Denis O’Donovan, there are tremendous opportunities to create jobs, specifically in the areas of aquaculture and fish farming. Obviously, there are difficulties with licensing, as there have been in the past. What plan is in place to expedite licences and to eliminate the bureaucracy which has been evident on previous occasions? The Minister mentioned supply not being able to meet demand in China and other areas where fish, including salmon, is concerned. Is there a plan in place to develop this area, which needs to be developed and which can create jobs into the future?
Deputy Simon Coveney: I wish to make a brief comment on something Senator Denis O’Donovan raised at the start, namely, the tragedy in Union Hall. I have spent two afternoons there but I would have liked to have spent more time there because at times like this, I have a responsibility to try to support communities linked to areas of my responsibility.
If ever one needed an example of the strength of a community, the tightness of an industry, the professionalism of the rescue services and the extraordinary generosity of volunteers, one will see it Union Hall. People have opened their homes and handed over the keys to total strangers, in order to provide them with comfort and shelter. Muslims are praying with a Catholic priest. It is extraordinary to experience the community in Union Hall since this tragedy happened a little over ten days ago. I thank everybody, in particular the Deasy family, who are deeply involved in the fishing community, and those from the south east, friends, family and relations of the owner and skipper of the boat and his wife, Caitlin Ní Aodha, whom I know well. The failure to recover the body of loved ones adds to the tragedy.
We appreciate the fantastic efforts of everybody involved in the search. I have spoken to the Garda and Naval Service divers. BIM is now supporting volunteer dive teams from west Cork. They are working in really difficult circumstances. Much of the search was conducted with less than 2 ft. of visibility under the water. Divers were thrown around by the currents and waves and were being dashed up against the hull of what is now a wreck. The leadership of the Coast Guard in co-ordinating the search and rescue and the contribution of bodies such as Civil Defence, the RNLI, volunteers and BIM, the Naval Service, the Garda Síochána is extraordinary during this emotionally difficult time. Our efforts are to try to support the families. The extraordinary community in Union Hall could not have done more and I have nothing but good to say about them.
This tragedy is an unfortunate way to start the year and is a reminder of the dangers of fishing. In the broader industry, however, there are opportunities. One of the positives is that Ireland negotiated a good deal in December because we based our arguments on science and took political opportunities as they came. We have got significant increases in the white fish quota and the pelagic quota. It is a done deal and I do not want to crow about it. It is a really positive sign for the industry. For the first time the Irish fleet will be allowed to catch in quota over €250 million worth of fish. We acknowledge we have problems in how we allocate that quota in terms of Celtic Sea herring and other fish stocks that are up significantly, such as cod, haddock, whiting. We must make difficult decisions on the herring and boarfish catch. Boarfish is a new species, that only had a quota for the first time last year and has seen a dramatic increase this year from just over 30,000 tones to 82,000 tones. This new species presents us with an interesting and exciting opportunity.
To those who talk down the fishing industry, referring to the end of fishing communities in an industry without a future, let me tell them that fishing has a strong future in Ireland. We are exploring the potential of new stock, increasing and managing quota, better than we have ever done in the past. We have a marine institute, funded by €6 million each year, to assess and manage stock. It ensures we are making the right arguments to the Commission, and the correct decisions in terms of managing those stocks. There are good things happening in the industry.
We were rightly questioned about the fishing industry. We are looking at ways in which we can add value to the product. Traditionally, fish have been caught and exported more or less intact as a commodity. We are now looking at ways in which we can add value, get more fish, grade it, process and package it and redesign it for the Irish consumer. Last year we spent €2.5 million through BIM to leverage €10 million of expenditure in the fish processing sector and we created many jobs in doing that. We will continue that into this year. We are looking at ways in which we can get non-Irish boats to land in Irish ports, in order that we grade and process their fish for them, because that is where the jobs are. Approximately 1 million tonnes of fish are caught in Irish waters each year and less than 240,000 tonnes of those fish are landed in Irish ports. That is not good enough. At a time of increasing fuel prices, it makes more economic sense for trawlers to land their fish close to where they are catching those fish. A great deal of fish is caught close to Ireland. We have the infrastructure and can build on it to deal with an increasing throughput of fish, which I hope we will be able to deliver. BIM is working hard on that issue.
To respond to the question on aquaculture, we are doing a great deal to develop this area. Licensing has led to a great deal of frustration, but I have granted a series of aquaculture licences in the past few weeks. We must be consistent with EU law in habitats directives, including the Natura 2000 directive. Unfortunately, practically every bay around the coastline of Ireland is a Natura area. There are a few exceptions in west Cork, one or two in other parts, and Bantry Bay for example, is an exception. Generally in order to put a fish farm or any development that potentially changes the eco system in those harbours, one has to go through a process, which is laborious, difficult, expensive and time consuming. We are trying to do that as quickly as we possibly can. Unfortunately we are at the mercy of the European Commission because the way in which we provided aquaculture licences in the past was not up to scratch. The Commission took a case against Ireland and won it. We are now being forced to put in place a gold plated licensing system. This is time consuming but we are staring to get through the applications for bays and will continue to work as fast as we can. In the meantime we are trying to shift the whole dynamic in fish farming. We are supportive of exploring the potential of bays for fish farms, having considered the friction with anglers and their concerns around issues such as disease, lice or whatever caused by fish farms only and will grant permission only when it is appropriate to put salmon farms there. I believe there is capacity for much more fish farming in bays, but outside of that we are moving to a new horizon. Next week I will have a licence application on my desk for a 15,000 tonnes salmon farm off the west coast, but which one cannot see from the mainland. It is nearly 2 km east of the southern most Aran island. One can barely see it from the southern most island on a clear day. We have put the buoys out on the sea to see it visually. I have seen the photographs from that planning. We are trying to take advantage of the extraordinary demand for organic Atlantic Irish salmon. There is extraordinary demand for that product worldwide. We currently have an output of some 12,000 tonnes of farmed salmon each year. If permission for this farm is granted, having gone through a rigorous licensing process — I cannot show any favouritism here — this farm will more than double our national output of salmon. We will have three of these applications in place by the end of the year. We may have six such applications done and granted within two or three years. Scotland produces 150,000 tonnes of farmed salmon. Norway produces more than 1 million tonnes of farmed salmon and wants to increase it to 2 million tonnes. This is the market in which we are playing but the difference is that the world prices for salmon from Norway fell by nearly 40%. The price for organic, Irish farmed salmon remained steady and strong because people associate Irish product with very high quality, high end premium salmon for which they are willing to pay a premium. The challenge for us, and this applies to the food industry generally, is where there is a clear opportunity in terms of markets, we need to keep the standards we have managed to develop in what is currently a relatively small industry intact but work on increasing the volumes and outputs, thus growing the number of jobs.
The capital cost of developing salmon farms will be approximately €50 million. Based on the current price of salmon, the farm to which I alluded would have an annual turnover of €103 million and would employ between 300 and 400 people. The reason I am able to provide such precise figures is that the largest salmon farming company in the country, Marine Harvest, produces between 10,000 and 12,000 tonnes of farmed salmon annually and employs 280 people. These jobs are located in areas which need employment. The development of salmon farms will feed into the processing sector and build a reputation for Ireland as a serious seafood producer, both in terms of volume and quality. We will also start to move from the current crazy system in which many of our fish processors import Scottish salmon to be processed and rebranded and sold as Irish salmon.
Deputy Simon Coveney: Many believe little is happening in the aquaculture and fish farming sector. We are about to change the fish farming landscape in Ireland in a manner with which non-governmental agencies and individuals who have concerns about the salmon farming industry will be comfortable. The scale of the proposed salmon farms is such that they will be offshore — up to 6km to 7km from the coast — and virtually out of sight. As I stated, it is not possible to operate such farms in the open Atlantic.
Deputy Simon Coveney: We plan to exploit this opportunity in a sustainable manner. The Department and its agencies will establish a proper licensing and testing system. The fact that I would welcome these developments does not mean we are not required to go through a thorough, independent and transparent licensing mechanism.
Regardless of how I distribute the Celtic Sea herring quota I will probably be taken to court because I will upset someone. When the quota for a valuable stock such as herring significantly increases, as occurred in the past year, everyone wants a piece of it. We also have a herring fishery off the west and north-west coast, close to County Mayo, which was historically larger than the herring fishery in the Celtic Sea. The Department is in the process of drawing up a management plan for this stock to enable the herring fishery in that region to achieve similar levels of growth as the herring fishery in the Celtic Sea. I am engaged in a consultation process and have invited all the stakeholders to comment on an initial proposal from me on the distribution of the valuable herring quota. All submissions have been received and we will have a round table discussion on the issue as I am legally required to listen to the views of all stakeholders before making a judgment call. As I indicated, some people will be unhappy regardless of what call I make. I am obsessed with ensuring the process proceeds correctly and all parties are given an opportunity to be heard and make their point. Ultimately, however, it is my job to make a judgment call as to how we can maximise the benefit of our natural resource of herring for the fishing community, coastal communities and the fishing industry generally.
Deputy Simon Coveney: This is my only objective and it is the reason for the proposals I have made. I am somewhat restricted legally in terms of what I can say, including on which way I am leaning in this regard, because whatever I say will be used as part of any argument that may be made later. However, if Senators wish to speak to me afterwards, I will certainly discuss my position with them.
We are trying to apply the same principles to the Celtic Sea as we are applying off the west and north-west coasts in respect of herring. I hope quota increases will be granted in that herring fishery of a similar magnitude to those approved in the Celtic Sea. Everyone will benefit from such increases. This is an issue of sustainable stock management and linking science with fishing experience to manage and build stocks. It was on that basis that we managed to secure such extraordinary increases in some stocks this year.
On wild salmon, the management of inland fisheries is the responsibility of the Minister for Communications, Energy and Natural Resources, Deputy Pat Rabbitte. I do not have any role in salmon licensing or the linkage between angling and tourism. That may not be as it should be but it is the current position. I have some influence on the relationship between aquaculture and fish farming, on the one hand, and angling on the other. If at some point we are reviewing policy in this area, I may consider ways in which small artisan fisheries could catch salmon. It is my job to speak to the Minister, Deputy Rabbitte, on these issues if we are developing new approaches and so forth. However, I do not wish to raise any hopes that the Government will allow wild salmon to be caught again any time soon. It is good that wild salmon stocks are starting to increase. Angling tourism is a significant industry and we can strike the right balance between angling interests and allowing the commercial, sustainable exploitation of the salmon stock. While this relationship is consistently fractious, we must all have an open mind on it.
Deputy Simon Coveney: I am unable to answer Senator Healy Eames’s question on oysters in Clarinbridge as I am not familiar with the issue. However, if the Senator provides details, I will revert to her. If the issue is one of dredging, it is probably not the responsibility of my Department. However, if I can be of assistance in the matter, I will examine it. When specific cases are raised I prefer to ascertain what is the exact position to enable me to provide a proper answer.
Deputy Simon Coveney: Ireland’s seafood exports to China are increasing. To give an idea of the size of the market, China consumes 91 million tonnes of seafood every year, of which 70% is farmed. Most regions of the world farm a substantial amount of the fish they consume. This is not the case in Europe which is behind the curve in this area. On the basis of current demand trends, the United Nations predicts that we will need to produce an additional 42 million tonnes of seafood each year to continue to feed the world population. Although this additional amount must come from the sea or water, it will clearly not come from wild fish stocks. We need to try to maintain what is currently described as maximum sustainable yield in terms of commercial exploitation of fish stocks while ensuring they remain intact. We will secure significant increases in volume either by finding new species such as boarfish or through fish farming and aquaculture. The challenge is to achieve this objective in a manner that is acceptable to those who live along the coast. It must also complement our tourism objectives and be environmentally sustainable. The deep sea salmon farming project is a good response to this challenge.
Deputy Simon Coveney: While the memorandum signed by my Department was for food, I suspect we will sign another memorandum with the Vice Premier of China next month which will be much broader than food.
Deputy Simon Coveney: Senator Ó Domhnaill asked about the Common Fisheries Policy, CFP, and perhaps we will need another discussion on this. The key issue of concern in that regard is the proposal from the Commission with regard to introducing a system of individual transferable quotas, ITQs. Currently, the way we run our system is that the quota the country has been allocated is reallocated to boats that are then allowed to catch that quota. They are given certain security in terms of access to quota, but the boats do not own the quota. What the Commission proposes is that we change the ownership or control model of quota from being State controlled and owned to being controlled and owned by companies and people who own trawlers so as to give them certainty in terms of quota. The problem with that is that it is like having privatisation of fishing quotas, because this creates a trading market for quota. In that scenario, the wealthiest people would buy up more and more quota, the fleet would get smaller, the boats would get bigger, the number of fishing ports would decrease and we would have consolidation in the industry.
Many want consolidation, because it is easier to monitor in terms of fish stocks and so on. However, that is not what I want in terms of trying to feed local coastal economies with economic activity. Commissioner Damanaki, with whom I have a very good relationship, knows this. She is genuine about what she is trying to do, but what she proposes does not suit Ireland or the Irish fishing model. There is huge danger that not only would there be huge consolidation within the Irish fleet, whereby the wealthy guys would buy up everybody else’s quota, but those people might then be bought out by foreign interests. The Commission may say that is not the intention and that it will put restrictions in place to ensure the trading of quota can only happen within national fleets. However, under EU law one cannot stop a Spanish fishing company setting up in Ireland and buying up quota through buying Irish trawlers.
Irish white fish quota could easily be bought up by Spanish interests, because they have a huge interest in increasing their quota in white fish. The Dutch might also try to buy up a large part of the pelagic quota, because they have colossal vessels that make our biggest vessels look small. Much of the fishing industry in Spain and the Netherlands is not about family owned trawlers or groups of trawlers. It is about multinationals running fleets of trawlers and they have the buying power to buy quota. It may make sense to the Commission to change the system in terms of managing quota, but it makes no sense in terms of keeping coastal communities intact and reliant on fishing. We are insisting on flexibility to allow Ireland not be forced to opt into the ITQ system. We do not have a deal on this — far from it — but we have made a strong case and the Commissioner knows where we stand and that I am very firm on it.
Another issue relates to discards. This is something on which I agree with the Commissioner, although I do not agree entirely with her solution. The idea that we would continue to dump hundreds of thousands of tonnes of fish over the side each year because our trawlers do not have the quota to catch them and do not want to bring them ashore means we are throwing dead fish back into the sea at a time when we are trying to improve stocks. Dumping fish that is marketable on shore is immoral. In some species we are killing three, four or five juvenile fish in order to catch one adult marketable fish because we do not have the necessary targeting mechanisms or do not use the available technology and design to allow juvenile fish to escape. This is not acceptable. The situation needs to change. The industry accepts that and is working with me on the issue. We are making progress with some pilot projects and will continue topush hard to make the change. I hope Ireland will give leadership in Europe on the discard issue.
As I have answered the question on adding value, I will move on to the question on the Fisheries Act. In the programme for Government we have made a commitment that we will try to introduce legislation that will move away from criminal sanction for certain breaches of the law and replace it with administrative sanctions. Nobody likes sanctions, but we cannot fail to introduce administrative sanctions, despite the industry’s dislike of them. If people break the rules, there must be consequences. I am uncomfortable — I was uncomfortable in opposition — with the fact that fishermen who break the rules in a relatively minor way acquire a criminal record which affects their capacity to, for example, enter the United States or other businesses. I see that as being over the top. Therefore, we have given a commitment to look at this issue. We have asked the office of the Attorney General to examine the issue and it will not be an easy provision to make. We are now looking at the issue because of a commitment in the programme for Government on which I would like to deliver.
The legal solution is not as straightforward as one might have thought. The former Deputy, Mr. Jim O’Keeffe, put legislation together on this issue which was used as a basis for testing the issue with the office of the Attorney General. We now need to return to the Attorney General to see if we can progress a short Bill that will ensure that fishermen who do not significantly breach the regulations are not punished in a way that does not fit the crime and are not given a permanent criminal record. This is not to say that we do not need to enforce the rules. We do. We need to protect fish stocks and the rules are there because they are needed. However, the sanction must be appropriate and we are making efforts in that regard.
|Last Updated: 08/03/2013 16:23:45||Page of 10|