Fiona O'Malley (Dún Laoghaire, Progressive Democrats)

I wish to share time with Deputy Michael Moynihan. Deputy Connaughton indicated the flavour of the Bill. The last budget was possibly the first to be passed without a vote. It is commendable that the Opposition did not put it to a vote because of the good provisions it contained. The Opposition says it is easy to be generous when the money is in the bank, but it is important to generate the money before giving it out. I commend the Minister on his budget and this Bill.

Deputy Sargent spoke about the lack of provision for biofuels, a topic on which I share his passion. The Taoiseach said there are no provisions for the industry in this Bill because the Finance Act 2004 provided for it. To date nobody has gained tax relief under that provision, which is lamentable. We need to consider why. The Taoiseach said that it is due to procedures. Acquiring state aid clearance is a necessary measure but Germany and France make very generous provisions for the industry which is flourishing as a result. Those countries meet the targets set by EU directives with which we must all comply in respect of the Kyoto Protocol and the development of a biofuel sector. By the end of this year 5% of our transport fuel must come from a biofuel source. We have a great deal of catching up to do.

While I accept provision was made for this last year, the Government cannot take comfort from the fact that the industry has not developed. Although state aid clearance has been in place since last August, some people should be availing of the tax relief at this point. Many co-operatives and organisations were set up when the provisions were introduced with an eye to diversification which complements the development of our agriculture policy.

When I was in school, diversification was the key to the future of the agriculture industry. This is one key way in which agriculture can be helped. If we consider the difficulties at Greencore in Carlow at present, there is an obvious solution to the problems of the workers and the future of the factory. We would benefit from looking at international best practice before seeing what we can do about it. We should not reinvent the wheel in doing this. We need simply to select the best and decide that if it is available to other countries under EU law and legislation, it should be available to us here. For example, last year British Sugar announced it was to build a £20 million plant to turn sugar beet into bioethanol, a type of biofuel which can be used in cars. This is the future and the way we need to go. The workers in Greencore in Carlow need comfort and the Government should provide the comfort that this is a solution to the potential factory closure.

In making this part of the future for a more diverse agriculture, the Government should use the tax system to stimulate markets. This is highlighted to great effect in regard to the much maligned stallion tax relief. While the Minister for Finance last year indicated this was under review, which is correct, it stimulated an industry at a time when this was needed. All of us are grateful that Ireland leads the way in the thoroughbred racehorse industry, which is a major industry here. However, given that the stimulation has taken place, we may need to review the relief.

The tax reliefs that worked for the thoroughbred industry should be applied to the biofuels industry. This would tie in with agricultural policy as well as dealing with our obligations and targets in regard to the Kyoto Protocol and developing a biofuels industry.

It is understandable the Department of Finance, which is charged with collecting money, never likes to see taxes forgone. However, the amount that might be in permitting the elimination of excise on biofuels would pale into insignificance compared with the benefits for the country in terms of employment. There is a live example of this in the instance of Greencore. It would reduce carbon dioxide emissions and help avoid punitive fines which will probably be imposed as a result of the Kyoto Protocol. We must plan well in advance and not take decisions when a crisis faces us full on. We need to plan now, which is why I welcomed this provision in 2004.

My point in concentrating on the biofuels sector, although it is not covered by the Bill, is to demonstrate that having the provisions in legislation is an important first step and an important signal on the part of Government as to what its policy will be. However, this must be underpinned by political will and, most importantly, the confidence and support of the Department of Finance. Without that Department moving swiftly on new provisions, they will not succeed, and I hope this fate does not befall any of the provisions in the Bill.

I am disappointed nobody has benefited to date despite that I get numerous telephone calls from people seeking to develop this industry and very keen to make progress. It is not that nobody is offering themselves. Rapeseed is grown in County Wexford through a provision of the Department of Agriculture and Food which provides a subsidy of €45 per acre. However, what is produced must be exported because our market has not been developed. We must kick-start the biofuels industry. Provisions in the Finance Bill 2004 paved the way but we need commitment and drive on the part of the Department of Finance to ensure these provisions become a reality.

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