Mr. John Bryan:

Deputy Martin Ferris asked very pertinent questions in respect of Pillar 1 and Pillar 2. We are stating that the single farm payment underpins production and that taking 15% from it would be a bad move. As he stated, it can be done. The UK Government is going to take 15% from Pillar 1 and transfer it to its own coffers. The money involved will actually be used to pay a subsidy on state forestry. The French Government is in the process of carrying out a large transfer from Pillar 2 to Pillar 1. We have informed the Government that we would not be in a favour of any major transfer. We might agree to a small amount being transferred to underpin a suckler welfare scheme but it should not be more than 3%.

In the context of Deputy Deering's question, we want a focused scheme. We do not believe people should be given money for doing nothing. We believe in higher animal welfare - such as that provided under the suckler welfare scheme - data collection and breed improvement.

The abolition of the milk quota will be of major benefit to the Irish economy. The Food Harvest 2020 targets in respect of milk are modest and I am of the view that we will achieve more than 50% and that we could hit 70%. If we consider the south Leinster and Munster regions, that is, north and south Tipperary, Cork and Waterford, a massive number of heifers are to be found on the farms there. This can assist yield improvement. As a result of the fact that we were constrained by the quota for 30 years, people did not push in this regard and we now have the lowest yields in Europe. The average yield across European countries is more than 150% of ours. Cows in this country will produce more than 5,000 kg. They will produce 6,000 kg or 7,000 kg. In my opinion we will substantially increase milk production and go well beyond the 50% projected. However, I remain of the view that there will be no more than 2,000 entrants. Banks will not loan money to farmers with 60 or 70 acres of land but they will loan it to those who have 250 or 300 acres and a large number of stock. Conversion is not available to small or medium-sized farms as a result of a lack of availability of cash. What will be the result of this? Production will increase in north Kerry but I doubt if it will happen in south Kerry. One cannot generalise but farmers in north and mid-Kilkenny will expand their operations but I do not believe those in the area in which I live will do so. It will happen more on a regional basis.