Willie Penrose (Longford-Westmeath, Labour)
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Anything that brings predictability to the situation in terms of the current concerns of beef farmers has to be welcomed. It is a contribution to bringing something forward that it is hoped will make an input in the longer term. People are less likely to be exposed to the vagaries of the market. I can see where it is coming from. I would say, however, that the proposal is inspired by Glanbia. It has tried this before with milk. It is not the first time Glanbia is venturing into this area. Kepak may well see a benefit in it and may have explored it with the farming public or those from whom its buy its product. The issue is the closed loop. It effectively kills competition. If this succeeds, other co-ops from the milk area will probably be rushing in to pair up with other competitors. We will shortly have three or four of the big co-ops with three or four processors. We all have worries about processors at all levels. In the Twenty20 club, as far as I can see, for the animal to get the bonus, the calf has to come from a Twenty20 farm, be reared on a Twenty20 farm, and has to get all its ingredients from one source: Glanbia. I thought prescription medicine was exempted. All the needs and requirements associated have to be got from Glanbia. It shuts out any competition, which is of concern. As Deputy Martin Kenny says, there are relationships built up throughout the whole supply chain that will now be sidelined.

I see the examples there. I am very much attached to the breed bonus and am glad to see it included. It is an excellent idea. I was bemused to see Mr. Goodman Jnr. effectively recognising the importance of breed for market access and penetration. I am sure Kepak and those companies that know more about market than I will ever learn will tell us that if one does not have a quality product, one will not penetrate the high-price markets. I look with interest at that.

Notwithstanding the efforts of Deputy Cahill, who is an excellent farmer and probably produces very good beef, he is correct about Friesians. I am sure he would produce more of them if he thought he could achieve what was outlined in some of the scenarios. I am a little taken aback but I cannot contradict the representatives of Kepak and Glanbia. I believe Glanbia is more interested than Kepak in ensuring that Friesians get recognition in the markets. I would like that being distilled out. I cannot see how the average quota prices would be achieved. If I am wrong about that, Deputy Cahill is making more money that I thought he was, but in any event I do not believe he is.

In all seriousness, this initiative is a contribution and we cannot pooh-pooh such contributions. Some beef farmers, many of whom I know well, are almost drowning in fatalism at this time. Anything that stimulates them to consider various scenarios is to be welcomed. However, I am concerned about the closed loop aspect. There is no point in saying it is not a concern when it is. Representatives of the Competition and Consumer Protection Commission will appear before the committee in a few weeks and we will explore with them if this concept is anti-competitive or if it stands up to scrutiny in terms of an anti-competitive practice. It is important that would be ironed out and taken out the equation. This does not involve Kepak very much, rather it more concerns Glanbia. I note the structure of its company, and Deputy Cahill pointed out that there are GI readings and so on but often the farmers are being rewarded with their own money within that structure. There point has been raised with us on a number occasions.

I am sure this initiative will be piloted with 5,000 or 6,000 animals. Perhaps we will all be proved wrong and our concerns about the closed loop concept will not be vindicated and will be dispelled. If they are, we will be the first to say we were on the wrong side of the argument. I have concerns about what I believe are anti-competitive objectives contained within this initiative. That is the only concern I have about it. My major concern at this time is the viability of the future of the beef industry. Like Senator Paul Daly, I come from a strong beef producing county. It will be interesting to see how this initiative goes down among the farming population of that county.