Michael Creed (Cork North West, Fine Gael)
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There are some common themes running through the questions. I will deal with the beef data and genomics programme. I concur 100% with Deputy Penrose's comments in this regard. With regard to the point made by Deputy McConalogue on funding, the important point to remember is there is a €300 million commitment across the lifetime of the rural development programme.

In the context of it being a co-funded scheme, we will not leave a brown cent after us in the drawdown of that fund. We will use all of that fund for the purpose of that heading. As a result of the delayed establishment, the number of applications originally received as against the number of people who dropped out, there were various fluctuations in the estimated drawdown in 2015. This scheme has the potential to revolutionise the beef sector in the same way the economic breeding index, EBI, has done for the dairy sector, with which many Members would be familiar. I was asked whether it will be reopened. That will remain under active consideration. There is a commitment in the rural development programme of €300 million across the lifetime of that programme. We will use all of that fund in respect of the beef data and genomics programme. Speaking from memory, originally we had approximately 29,000 original applications, we have approximately 25,000 now and we have commenced payments under it. We will maximise the drawdown. If the figures allow for the reopening of the scheme, my Department and I will look at it.

In regard to the points raised by Deputy Martin Kenny, I acknowledge that agriculture is the engine that will drive the economic recovery of rural Ireland furthest. In fact a number of years ago when we faced a very difficult crisis, the then Government identified the key engines that would drive economic recovery, which in rural Ireland were agriculture, fishing and tourism. In many respects because of the collaboration between the public and the private sectors, we have made significant progress in this regard. It is appreciated in a community, like the one Deputy Martin Kenny represents, that we need to be vigilant.

On the issue of delays in payments, I was in opposition, questioning Ministers and officials on delayed payments. It is very frustrating to be awaiting a basic payment or grant from the Department when merchants or agriculture contractors are waiting to be paid. It becomes acutely embarrassing for farmers. I have a number of observations in this regard. Last year was particularly difficult because we had a transition to a new Common Agricultural Policy, CAP, payment system with which we had a number of teething problems. It is acknowledged also that there is a resource issue and Members will see in the Estimates that there is provision for additional human resources in the Department. While the staff will be spread across a series of areas in the Department, I have had negotiations with senior management on addressing prompt payment and the particular issues raised by the Deputy. We have negotiated a charter of rights with farmers, which obliges the Department to facilitate meeting ambitious targets in respect of prompt payments.

I make the case that many of the difficulties that arise with regard to delays in the basic payments arise in particular from paper applications as opposed to online applications. As Members will be aware, the online applications are facilitated with preliminary checks, whereas the paper applications, because of the obligation to put the applications on the IT system in the Department, do not get the benefit of those preliminary checks. Many applications come in signed stating no change, but when the processing of those applications takes place later, problems are identified which results in a tennis match over and back between the Department and the applicant. This delays the applications. The ambition is to get to a situation within the next two years where we have 100% online applications in order that every applicant will benefit from the preliminary checks. It is an ambitious target to get to 100% and I would be interested in hearing the views of committee members. It does offer a very significant benefit to people who make the online application because they get the benefit of a no-penalty preliminary check on their application. It will be difficult to reach that last cohort of people who still make applications on paper.

They are probably, by and large, people who are not IT savvy or who may have difficulties with access to broadband. There are a combination of issues at play, including age. That poses a challenge for us in terms of getting them engaged with the online system and convincing them of its benefits in ensuring prompt payment.

I wish to deal now with the hen harrier issue. We will be submitting an amendment to the European Commission by the end of this month. Part of it relates to the new sheep programme but it will also contain a proposal in respect of the hen harrier. That is the preliminary work that must be done in this area. Then we will need to develop the scheme and my ambition is to begin payments in 2017. Those payments in conjunction with GLAS payments will bring us a long way towards the situation which prevailed prior to the suspension of the previous scheme of which many people were beneficiaries. Many of these people are in my own constituency and I am very familiar with the issue. I also know that other Members present are familiar with it. It has been a very difficult period for those affected. They were unfortunate in the manner in which the process developed when the previous scheme closed. That scheme was very generous, involving payments of up to €14,000. However, a combination of GLAS payments and payments under the new scheme will allow us to get close to the situation which prevailed under the previous scheme and that should make a real difference.

Our amendment to the rural development programme must be submitted to the European Commission by the end of this month. As I said already, part of that relates to the sheep programme and we are currently in consultation with the various stakeholders on the issue. I have never said that electronic tagging would be a precondition of the scheme, but it would be remiss of me not to reflect, in the context of the consultations I have been having with the various stakeholders, the view which has been expressed strongly by the industry in the context of accessing new markets that electronic tagging is used in other jurisdictions with which we compete. The point has been clearly made to me by those selling product and those in the markets into which we are attempting to gain entry that the lack of electronic tagging puts us at a competitive disadvantage. Specifically, that point was made in the recent discussions I had with the US Ambassador and several of his colleagues on market access. It is a point that comes up regularly and we would be burying our heads in the sand by refusing to acknowledge it. There is significant potential in the sheep sector in terms of new markets and an expansion of the industry. However, we must be able to compete with other producers, and traceability is a key issue in this regard. Our product is as close as one can get to the origin green dream, if I can put it that way. It is as close to a natural product as one can get but traceability is the final element which would give us a competitive advantage in respect of other markets.

On the issue of Johne's disease, Animal Health Ireland, AHI, is running a pilot project involving private veterinary practitioners. This is a significant issue. Johne's disease is a wasting disease with which Members will be familiar. All the stakeholders under AHI have identified it as a priority area and a pilot project is under way at present. It remains to be seen how the lessons of that pilot project can be mainstreamed, but AHI, which is funded by my Department, has been active in this area. We have paid €500,000 to date to AHI for work on Johne's disease. The problem is recognised. As Members will be aware, AHI is active in a number of areas, including Johne's disease, infectious bovine rhinotracheitis, IBR, bovine viral diarrhoea, BVD, and so forth. These are issues of animal health that must be identified and tackled.

The Deputy also referred to Teagasc. My Department sanctioned up to 77 additional staff in respect of Teagasc's education programme and the green certificate in particular. Under the discretion allowed to Teagasc, it now has greater freedom to recruit to its advisory service. We are making progress albeit it is an area we need to keep under review. We have also given Teagasc some latitude in respect of how it allocates its own resources within the overall cap in terms of additional staff. There is an ongoing review of the green certificate content. International experts are involved in that review along with Teagasc's own advisory and education staff to determine whether the qualification, which is now of long-standing and of which I was a beneficiary many years ago, is up to the mark in respect of the challenges those now entering a career in agriculture face. That kind of review is welcome and Teagasc has embarked on it.

There is no silver bullet to resolve the question of volatility. I do not want to imply that the only area in which there are difficulties due to volatility is the dairy sector, but by coincidence I chaired yesterday my first meeting with the dairy forum. We had a very useful discussion along all of the lines raised in terms of cost of credit and access to it. I have met with the pillar banks on this issue also. While we cannot buck the market in respect of ensuring an additional price is paid to farmers per litre of milk, we can do a great deal in other areas. I have been active in this area of superlevy difficulties but I regret to say my efforts have so far been unsuccessful. I have been in contact with the Commission whose argument is that it does not have the legal framework to give relief to that particular cohort of farmers. There are 3,700 farmers who have difficulty in that area. Although it is not a matter for Commissioner Hogan, we have raised at Council meetings the issue of the tariff on fertiliser, which we estimate could deliver a dividend in the region of €14 per tonne. That would be a significant cost reduction to the farming community. I have discussed the matter with Commissioner Moscovici, who is French, and, one-on-one, with the French agriculture Minister. I have been active in the area but I do not know if it will deliver.

Market access is another critical issue. The Deputy mentioned markets like Iran. I have met the Iranian ambassador in the last month. Historically, we had very significant market access there. We are now in a post-sanction era and the opportunities are there again. There are still some difficulties in the area of banking which make things more difficult. I had recent meetings with Ár-Nua which is now active in that space. Certainly, it is a market we have identified given that there are 80 million people in Iran, but it is also a corridor of access to up to 200 million people in the wider region. We see it as significant but we need to make more progress in that area.

On the issue of access to affordable finance, I salute initiatives by the likes of Glanbia in the MilkFlex area. We have greater room to manoeuvre now in respect of state aids on financial instruments and my Department is actively exploring the options in that space. We are going to appoint consultants to determine if there is market failure here. The Deputy rightly makes reference to the variation in interest rates across the European Union. The quarter 1 report from the Central Bank said the variation was from 2.2% in Austria to 5.8% in Ireland. That is the difference between top and bottom. We are appointing consultants to see if we can establish an ex antemarket failure. My instinct is that if there is one, it is in the area of interest rates. That is where it is most identifiable. On that basis, we will explore the options we can bring to the table on access to more affordable finance.

The issue is not one of access to finance, it is one of access to affordable finance.

One other point I make on foot of consultations I have had with the banks is that all of them are saying, “Please come in and talk to us if you have a difficulty”. That is a good idea. There is a cultural issue whereby most farmers tend to want to have minimal contact with their bank managers even when they are in difficulty. They can head off some difficulties if they engage at an early stage. Yesterday, we launched at the diary forum a new tool in terms of cash flow management and budgeting which is going out to every dairy farmer through the co-operative movement. It will also be promoted by Teagasc through its farm walks. We hope it will be a tool dairy farmers can make some progress with in terms of managing their finances and cash flow. A combination of tax liabilities on foot of incomes earned when milk prices were much higher than they are now, the super levy and merchant credit is going to lead to a particularly difficult period at the back end of the year.

I appreciate that I have digressed but I want to make one closing remark. If I have left anything out, I am sure people will tell me.