Willie Penrose (Longford-Westmeath, Labour) | Oireachtas source

I thank the IFA witnesses for their presentation. It is interesting, but there is nothing new for those of us who live in my county. We know this at first hand because every time we meet farmers, particularly in the suckler cow area, they tell us exactly what is happening on the ground. The west, as Senator Conway-Walsh has said, is highly dependent on suckler cows. In the midlands it is a fairly important source of farming activity. The fall-off will continue, so let us not start codding ourselves. I have little time for anyone who tries to pretend this will not happen. Of course it will happen. In my country a significant level of dairy conversion is taking place. Farmers are business people. They are gravitating to where there is a possibility of some sort of a decent income. It is not just happening in Westmeath or the midlands. It is happening even in Deputy Cahill's county of Tipperary and in Cork, Waterford and Kilkenny. We have seen a huge drop in suckler cow numbers over the past six or seven years, and 35,000 or 36,000 cows have come out of the system. That is huge. We have lost almost 80,000 cows over the past seven years. I read Professor Hennessy's full report, which is very good and very useful.

I would say the IFA itself, at executive level, was not surprised by the findings. It merely vindicated what it knew what was happening and this report allows it to present the findings to various bodies. It is quite clear that the current trend is going to continue, with income from suckler cow activity falling. When the numbers are calculated at the end of this year, we will see significant increases in input costs because of the drought and the fodder shortages that resulted from the very harsh and prolonged winter.

I probably am one of the strongest advocates for the BDGP. While there have been some teething problems with the programme in terms of stars, breeding and so on, those problems can be ironed out by the time we embark on a 2020 programme. We should start dealing with the various issues now in order to have them ironed out by then. We must be honest, however, and admit that were it not for that programme, a huge number of farmers would have left the beef sector altogether. A significant number of farmers are tied into the BDGP until 2020 and while people may give out about the programme, it does yield some benefits. If farmers were not tied into the programme, the fall in suckler farmer numbers would have been even sharper than that outlined by the IFA this afternoon. I agree with those commentators who argue that the fall-off in suckler farmer numbers could accelerate further after 2020 if we do not get our house in order. Apart altogether from its impact in terms of our carbon footprint, we need a new BDGP to prevent the suckler farmer situation from worsening.

Four farmers visited my house recently. They were in relaxed mode and spoke freely. Those farmers told me that they would be approaching the IFA and others, not in aggressive way, and would tell them to wake up and smell the coffee. Farmers are getting poor prices, while the beef processors are quite happy to see stock numbers remaining relatively level. The processors will continue behaving in the fashion to which we have all become accustomed, namely, the free market model of screwing farmers. I am a member of a party that does not support the absolutist free market model. We have been condemned by many for expressing the view that the free market model is not the healthy option. There should be more socialism operating in this area. In any event, farmers are now saying that they would be better off taking their basic farm payments and giving over some of their land to forestry. If they set aside 10 acres for forestry, they will get X premium but if they set aside 15 to 20 acres, they will get X plus Y premium. This is the way farmers are thinking. The four suckler farmers to whom I spoke are now wondering about the future. One of them has three sons and he told me that he knows that none of them will succeed him. If farmers in Westmeath are talking like that, in a county that has a tradition of beef farming, then we must pay attention. I am not making this up. One of the farmers has sent me on a list of actions that he believes need to be taken and I will send it on to some of the witnesses here today. He believes that we must face reality and stop skirting around the issues.

The equation is simple enough: lower minimal market returns relative to the input costs of production. Without the basic farm payment system the industry would disappear, as it would not be viable.

The IFA is right in identifying something I have been talking about for the past two years, namely, the CAP budget and the loss of almost €11 billion or €12 billion from the UK Government. That is absolutely staggering. If we do not get EU member states making up the deficit, that could well be the situation. There are four or five very large member states that have indicated clearly they have no intention of making a contribution to make up the deficit. We cannot be left alone. We will not be making up the deficit of €10 billion or €12 billion. We have to be very careful about that.

There are good things apart from the impact on rural areas. It is a highly export-oriented industry; nine of every ten animals we produce go to export with a major earning capacity deriving from that. There is sustainability and we have the beef data and genomics programme. The IFA has previously made the argument that given the demand for quality beef across the world, if we do not produce it somebody else will. The Brazilians are ready to capitalise. They are knocking down half their forests and then transporting stuff across the world. That is a double whammy. They are taking out the sequestration capacity and increasing it at the other end by the transport issues.

All of that is there. We have a clean, green, grass-fed image. We better face up to reality. I am acutely aware of family circumstances with a suckler farm close to home. I cannot see my nephews and nieces taking up the suckling enterprise in the current climate. How could they rear two or three children and put them through college on that income?

It is a very big job and it is very easy to give out about farm organisations. For once I will not castigate the IFA representatives in this situation.