Dr. Rogier Schulte:

I thank members for their excellent questions. I wrote them down but do not hesitate to tell me if I skip any.

The 60% increase in demand for food is a global figure, but there are very different challenges and demands around the globe. There is great potential for developing countries to increase yields through the use of science and technology and the application of simple things such as fertiliser. We are working closely with Irish Aid to lend our expertise in agricultural production and have established an international food security committee to co-ordinate that expertise with Irish Aid. Senator Susan O'Keeffe is correct to point out that 1 billion people are undernourished or hungry. That is one of the main drivers of our collaboration with Irish Aid.

There is a certain degree of confusion about the targets set under Food Harvest 2020. It contains only one volume target, that is, an increase of 50% in dairy and milk volume in response to the phasing out of the milk quota. All of the other targets are value based. The changes in the demography of the national herd and land use will be less dramatic than they may appear at first glance. For example, the projection from our Teagasc FAPRI Ireland model is that we will see an increase in milk volume and the number of dairy cows, but it will be partially offset by a projected contraction of the national suckler herd. As these additional dairy cows produce more calves, they will offset some of the suckler cow production.

On whether intensification under Food Harvest 2020 will increase pressures on water quality, this is where management comes in. Our agriculture catchment programme aims to measure the impact on water quality of intensive agricultural production in compliance with the nitrates directive. This is a complex programme, with complex outcomes, but the headline is that the nitrous action plan will go a long way towards ensuring good water quality across the board. When we bring our paper into the equation, a wide range of soils have the capacity to process additional nutrients. This is reflected in the good water quality status we enjoy in Ireland compared to many other EU member states. However, certain soils are approaching their maximum capacity for processing these nutrient loads and purifying water to quality standards. This is where target management comes into play. Some soils can cope with additional nutrient loads, whereas others cannot. The most important achievement of Food Harvest 2020 is that it has brought sustainability and growth in the agriculture industry to the same side of the table. The environment is no longer considered a constraint on production. We are now building on our green credentials. Bord Bia is promoting this as a point of differentiation on international markets. The sustainability of our systems will allow us to grow the industry. Clearly, we cannot afford to sit still because other countries are catching up with us rapidly. We have to keep working on sustainability.

That leads me to the question of genetically modified organisms, GMOs. This is a complex area. Perhaps members saw the most recent episode of "Eco Eye" which featured some of Teagasc's research on GMOs. We maintain a completely scientific position on the subject. There are clear benefits from GMO crops, but there are also perceived risks. We are researching both the potential benefits and the potential risks in highly controlled and regulated conditions and will await the outcome of our research before taking further steps. It is worth noting that the field of genetic modification is developing very rapidly and the distinction between conventional breeding and genetically modified breeding is beginning to blur in laboratories. It may become increasingly difficult to tell one from the other.

I will ask Mr. Fealy to speak on the issue of incentivisation.