Michael Creed (Cork North West, Fine Gael)

I thank Deputy Crawford for sharing time with me. This is an extraordinary Bill, by any stretch of the imagination. It is an amalgam of various revenue-raising proposals. It provides for child benefit cuts, a public service levy and charges on health professionals. As Fine Gael's agriculture spokesman, I am most concerned about the section of the Bill that will defer payments under the farm waste management scheme.

We have to acknowledge that these economic times are unprecedented in the history of the State. We have almost run out of appropriate terminology to describe it. I do not think we have reached the bottom of the pit yet. People outside this House have not yet recognised the gravity of the situation we are in. I believe the Government will be obliged to introduce a new budget in the not too distant future. The public finances are unravelling at such a pace that a new budget, with tax-raising measures at its centre, is inevitable. The most regrettable thing about all of this is that no cohesive plan is emerging from the Government benches. The Government is not willing to adopt a bipartisan approach to solving this problem. The Government's "we know best" approach is not serving the nation at this critical time in its economic history.

It is not sustainable to borrow €55 million a day as we are doing at the moment. I wish to make it clear, before I move on to the parts of this legislation that relate to the agriculture industry, that Fine Gael will oppose this Bill on Second Stage because we do not believe it represents the comprehensive panacea that is required. While there is a price worth paying for the security that comes with public service employment, it is indefensible that the proposed public service levy is disproportionately skewed against lower-paid workers in the public service. As I have said in previous debates, the political classes in this House have to lead by example. If the Taoiseach had made a commitment, in the first instance, to start leading by example in this House, he would have gone some way towards addressing the problem. The current position is untenable. We need to address it.

I assure anybody who is not familiar with the problems in the farm waste management scheme that the point I would like to make in respect of the scheme does not represent special pleading. Farmers had to invest in waste management systems to enable them to stay in business. The systems do not generate any additional income for them. In fact, farmers are exposed to a liability as they will have to pay for the balance of the works over a number of years. Deputies who are involved in the business or farming communities outside this House will be familiar with the well-established principle to the effect that if one pays one's taxes late, one will have to pay penalties and interest. The same principle should apply to the State in respect of the contract into which it freely entered with farmers throughout the country who had obligations under the farm waste management scheme. Some 17,400 farmers were run up a chute when they were told they had to complete works under the scheme by 31 December last.

I do not know where to start when highlighting the debacle that was the handling of this issue by the Minister, Deputy Smith, and the Department of Agriculture, Fisheries and Food. If the Minister had accepted the thrust of the Private Member's motion on this issue that was proposed by Fine Gael last November, he would have extended the deadline and allowed farmers to complete these works throughout 2009. He could have made it clear to farmers that payments would be staggered if works were completed in 2009. It is entirely unacceptable to pull the rug from under farmers after they have organised finance with their banks and completed their works. That is what the Government is doing, in effect, by providing for staggered payments over three years without proposing to cover interest payments. It is entirely unacceptable, as I have said.

This House introduced the prompt payments legislation, with much fanfare, some years ago. It provides an example of how the State should do its business. Under the legislation, the State is obliged to pay its customers within 30 days. If I recall correctly, the charter of farmers' rights requires payments to be made within eight weeks. It is entirely unacceptable that such contracts are being unilaterally torn up by one partner to them. The Government would not get away with it if it were not for this legislation, which is a signal of the weakness of a Government that is trying to weasel out of contracts into which it freely entered.

I will propose two amendments to this Bill on Committee Stage. The first amendment will require the State to cover the interest liability that will accrue to farmers while they await full payment. I hope the Minister of State, Deputy Sargent, and his Government backbenchers will support that amendment. In the current climate, the cashflow problems of farmers are exacerbated by other problems in the Department of Agriculture, Fisheries and Food. I refer to problems with the refund of VAT that is due on certain works, for example. There are delays in getting documentation back.

A range of problems is associated with farm waste management. The Department can share the blame for the collapse in the dairy sector, which has been caused by the failure to invoke adequate market support measures. The House does not need to be reminded of the pork dioxin crisis. The agriculture sector is an engine that can contribute to the revitalisation of this country's economy. It needs to be recognised as an indigenous industry in which people work hard to create employment in their own farms, while sustaining thousands of off-farm jobs. In addition to our first amendment, which will deal with interest payments, we will propose a second amendment to provide for the payment in two instalments, of 40% and 60%, of the liability associated with the farm waste management scheme.

As the Minister for Finance is not here, I would like to ask the Minister of State a specific question. Some 17,400 farmers are involved in this scheme. If one works on the basis of an average payment of €33,000, the liability can be estimated to be approximately €575 million. Some €125 million has been provided in the budget of the Department. It is proposed to pay 40% of the liability in 2009. I estimate that 40% of the total liability is €230 million. I want clear answers. I do not want to tell farmers in a week or two weeks' time that it is proposed to pay 20%, rather than 40%. Where will the Government make up the shortfall for the €125 million provided for in its estimate, and the €230 million that is required to make a 40% payment in 2009?

The Government's mathematics simply do not add up. Its mathematical failings led us into this debacle the first day. Anybody with any understanding of that scheme would not attempt to hide behind a claim that they miscalculated because they did not expect as many farmers to be involved. It was widely known that the Government's liability was going to be in the region of €500 million, yet it failed to provide adequately for even 40%. I would like clarity on that issue. I also invite the Minister of State's colleagues on the backbenches to support the issue of interest payments on this matter.

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