Mr. John Bryan:

I shall start with the questions raised by Deputy Harrington. His comments on agriculture are in line with ours.

We see agriculture and food production - whether it is forestry, aquaculture, the suckler herd, or dairying - as critical in creating employment. I agree with Senator Ó Domhnaill and Deputy Barry that the potential of agriculture is underestimated. Glanbia is planning to build an enormous processing centre in south Kilkenny and agriculture can provide countless jobs in the next few years. However, we must sustain the jobs on the farms. On the issue of the €114 million budget, savings have been made already. The fact that the REPS payments and early retirement payments are running out means that €40 million can be saved. There have been staff redundancies this year also and there is probably somewhere between €50 million and €70 million in savings achieved already.

As Senator Ó Domhnaill said, the Government will have to look at areas they did not look at the last time. Last year the Department disproportionately hit the farm schemes. I have urged the Minister to ring fence the farm schemes and look to other areas for savings. I do not think that is unreasonable because some of the other areas were not touched last year. I am not saying I want to touch anything but if the Minister has to make savings he should stay away from the schemes because they are critical to employment. He should look at the other areas.

When I am finished, I will ask Mr. McCarthy to say a few words on the commonage framework plans. The IFA takes the attitude that while something has to be done, the plans were rushed. We do not hold with collective responsibility, for example. If one holds with collective responsibility then if someone in this room commits a crime it means we should all be locked up. That is unreasonable and unfair and we cannot accept it. I agree with Senator Comiskey that something must be done on the commonage plans. Perhaps exempting them from capital gains is an option as there would be no loss of revenue in that. A broader approach is definitely needed.

Senators Ó Domhnaill and Comiskey both referred to the savings that were to be made in the less favoured areas, LFA, schemes last year. We said to the Minister at the time that exemptions had to be applied for those who were in special areas of conservation, natural heritage areas, those with commonage framework plans and those in environmental schemes. When all of that was factored in, the total was never going to drop below €220 million. At the time, we felt that if a stocking density was to be introduced, there should be three different levels. There should be one level for the hill, another for the more severely handicapped land and yet another for the less severely handicapped land. One should never apply the same stocking rate on a hill as on less severely handicapped land. There may be some technical problems with that but sometimes one must take the more complicated route to arrive at a solution. Having the same stocking rate on the top of a hill as on less favoured areas is not appropriate. The IFA believes that different stocking levels for different areas is the way to go.

During meetings we have held all over the country we got the clear message that there are many farmers who are working very hard and who want to sustain jobs but they are very dependent on pillar 1 or pillar 2 funding and any major change in distribution will have serious consequences for them. The proposed savage cuts in the multi-annual financial framework, MFF, across pillar 1 and pillar 2 will create enormous problems. The Baltic states, Romania and Bulgaria are seriously below the EU average at the moment and no-one thinks they will take a cut. Therefore, if there is a cut, it will hit countries like Ireland, which are close to the average, far harder. It would a very serious impact.

I agree with Deputy Barry that at a time of tightening resources, we must distinguish clearly between active and inactive farmers. There is no way we can be all things to all men every day. We cannot say that someone who has made a decision to give up farming should still get his or her single farm payment, disadvantaged area payment or any other payment. We must be very clear in our support for active farmers.

On the issue of land mobility the IFA has a very reasonable proposal that the sale of land which is being transferred for active farming be exempt from capital gains tax. There is no loss of revenue involved because a farmer will simply not sell a field if he or she has to pay capital gains tax. We have done some work on this and it would be revenue neutral but would facilitate a reduction in parcel numbers.

The IFA believes that the Cioloș proposals do not take any account of food security, which is the biggest threat facing the world. The world population is expected to grow from 7 billion to 9 billion, which is a real threat, both to food and water supplies. The water resources in Australia, North America and France are already under severe pressure. Food production in Europe is vital and that is what is missing in the current CAP reform proposals. The CAP budget was reduced from €1.33 billion to €1.24 billion. If another 10% is taken out, that equates to €200 million less before one even starts. We have already had modular and other cuts so the stance the Government takes on the MFF negotiations is vital. Just because David Cameron jumps up, the whole of Europe cannot tremble and agree to cut one of the strongest pillars of the EU. It is essential that countries such as Ireland, France and Germany tell Mr. Cameron to roll back a bit.

The domestic budget is under the Cabinet's control. As I said to Deputy Harrington with regard to the €114 million, we have already hit the agricultural schemes so now it is time to look at other areas. It will not be easy to find savings but some areas lost 0.5% or 1% last year, while the schemes lost 17%. Given the employment potential in agriculture, cuts of 8% are too high. Schemes like REPS and AEOS are absolutely essential. There are a lot of farmers who are in receipt of small single farm payments of between €7,000 and €8,000 and getting an additional €4,000 under AEOS makes an enormous difference to them.

Regarding the issue of penalties, if someone is in my yard, I must treat him or her with respect and dignity and vice versa. Spend a week in a man's yard and one will see a lot. If someone is sick, even more care is required. I was aware of a case in Kilkenny where an inspection was due to take place but the farmer was suffering from depression at the time. When I rang the Department, the inspection was postponed. Depression is a common thing in rural Ireland, especially with isolation and that must be borne in mind by the Department. Inspectors should be trained in how to deal with people and how to have a compassionate and understanding attitude. If they are in doubt, they should cancel the inspection and come back another day because they do not know the pressures that people are under on the ground.

Redeployment of staff could yield some savings, as would other measures, but I would be very conscious, in redeploying staff, of the need to protect frontline staff, whether they are in Teagasc, Bord Bia or other essential areas. I would prefer to see redeployment within the Department itself rather than in the frontline services. I will now hand over to Mr. McCarthy who will deal with the commonage framework plans.