David Stanton (Cork East, Fine Gael)

I thank the Ceann Comhairle for allowing me to raise this very important issue. I hope the Minister of State will provide clarification on the levy. The IFA issued a press release on 20 January 2006 which accused the Minister for Agriculture and Food of misleading the IFA annual general meeting by saying that it was not necessary to pay a restructuring levy of €25 million in 2006. Less than 24 hours later, the Commissioner responded to a question on the matter put by my colleague, Mairéad McGuinness, MEP. She asked whether a country like Ireland must contribute to the restructuring levy in 2006 if it grows sugar beet that year and whether it should intend to cease production in 2007. She stated that this issue was crucial as it would determine whether Ireland produces sugar beet in 2006, which could be the last season for growing sugar beet in this country. The Commissioner responded that the only way to avoid this payment to the restructuring fund is to do away with sugar beet production in 2006 and 2007.

The Minister must clarify this matter because the situation is becoming very serious. A total of 3,700 farmers grow sugar beet who need to know now about the position regarding the levy. A total of 1,000 people employed in the sugar beet processing industry and ancillary activities also need to know how matters stand regarding the levy. Greencore Sugar issued a letter to its growers dated 27 January 2006 which mentioned the necessity of clarification regarding the temporary quota cut in 2006. This cut, which appears likely to happen, could range between 8% to 14%. The decision is critical, particularly if the restructuring levy must be paid on the entire quota. The letter went on to state that Greencore Sugar faces substantial risks attached to processing a sugar beet crop in 2006. The company would like to process sugar beet in 2006 but must engage with its partners to see how these risks can be mitigated or eliminated before such a decision is made.

Farmers must decide whether to grow sugar beet this year. They must make arrangements about matters such as conacre, fertiliser, seed and getting the land ready. They are making these arrangements at the moment. The Minister of State must clarify whether or not the levy must be paid if sugar beet is grown in 2006. What is his understanding about the quota cut?

It is a sad day for Ireland to see the end of the sugar beet industry but people are beginning to accept that it will happen. However, it is crucial that we find out whether 2006 or 2007 is the last year for growing it. If 2007 is the last year for growing sugar beet, will a levy of €25 million be paid this year and a levy of €38 million next year? I am pleading with the Minister of State to clarify issues surrounding the levy because it is a matter of smoke and mirrors at the moment. The people affected are angry, upset and confused. I am sure the Minister of State realises that much hinges on the operation of the levy. I could address the compensation fund but it is a matter for another occasion. On this occasion, we need clarification regarding the levy. Must it be paid this year? The Minister told the IFA that it does not need to be paid but the Commissioner has stated that it does. Who is right? We need an answer tonight. I await the Minister of State's answer with anticipation.

See this speech in context