Dáil debates

Thursday, 24 October 2024

Equitable Beef Pricing Bill 2020: Second Stage [Private Members]

 

4:30 pm

Photo of Peadar TóibínPeadar Tóibín (Meath West, Aontú) | Oireachtas source

The Government is missing two massive points. First, it is missing the point that the market is already distorted. I have a degree in economics. Anybody who analyses the food market in this country will tell you that it is, by definition, a distorted market. It is not unusual for the Government to preside over distorted markets. Much of the economy, such as the insurance industry, house-building and the banks, for example, comprises distorted markets. The two-pillar bank system we have is another oligopoly, an oligopoly that favours the two providers but really hurts the small businesses and families looking to do banking. We live in a distorted pricing system. It is broken. It is not the case that this Government stands for a free economy and that the invisible hand of the market will resolve the price difficulties here. If only it were that simple. The situation is the Government is presiding over an oligopoly whereby a small number of factories and supermarkets have enormous buyer power. They can do what they want. They can squeeze those farmers down to the last cent if they so wish. There is nothing to hold them back. There are no protections there. They do it on a regular basis. As a result, we see farmers having to strike and protest outside of factories. We see poultry farmers having to strike outside Aldi and Lidl because the price they are getting for their eggs is below the cost of production. We can see it in the beef and sheep sectors as well.

Until we have a properly functioning market, the farmers are going to suffer. The Minister of State mentioned this pot of money here and that pot of money there. It reminds me of what is being done in enterprise. It is welfare for farmers and welfare for enterprise. It is social welfare. It is basically saying, "We know the market is stuffed but we will give you a few bob to make it okay." The Government would not have to provide these schemes if the money was being distributed fairly along the supply chain.

I do not believe there is an understanding of economics within the Government's approach to this. That worries me. If there were such an understanding, there would be a desire to reform those markets. One of the reasons we are such a high-price country in so many ways is the massive power these organisations have. Supermarkets are currently gouging prices from people right across the country on a regular basis, and they are allowed to do it. Insurance companies are gouging prices. It took the intervention of the EU to try to resolve this and put Ireland under pressure with regard to the insurance companies and what they were doing to the market. We live in a distorted pricing mechanism and we live in a distorted market. That is the first part.

The second part is that while it is great to get a few bob here and there, that welfare does not make up for the simple wish of farmers and people in enterprise who just want decent input prices. They want a decent price for their product. They want decent transport infrastructure and decent ICT in order that they can communicate with the world.

Then the Government will not have to provide that welfare for them in the long run.

The second issue, the elephant in the room, is that the sector is in freefall. I gave figures about the price falling. Last year, tillage farmers saw their price fall by 71%. I imagine there are a good few tillage farmers in the Minister of State's constituency in County Kildare. Dry stock has an average income of €12,600. Sheep farmers have an average income of €12,500. This is way below minimum wage income. Even dairy had a collapse of 69% last year, an incredible figure. The average wage is about €20,000, half the average industrial wage. Farmers have been impoverished across the country, so much so that every year farmers vote with their feet and leave the sector. Every year, farming is no longer the primary income in those families because they earn a living from another job and the farm is a hobby. It is a part-time effort for most of those individuals. They only function because somebody works as a teacher, nurse or somewhere else outside of the farm. We cannot allow this to happen. On a humanitarian level, there are a lot of arguments why it should not happen because it is wrong to push people who provide a good product and do all that work into poverty. There is a human justice element in making sure we defend their incomes. In other sectors, trade unions would defend their incomes on a regular basis. Right now, that is where we are at. The Government is ignoring those two elements. In fairness, a lot of pressure has come on the Government and there is the regulator but there have been no efforts by the regulator yet to push back on this inordinate and unfair level of power.

The Minister of State mentioned international markets. This is an issue which the Minister, Deputy McConalogue, often brings up. Farmer Brown, when selling his cattle, does not get the cattle, put them into the trailer and bring them over to Belgium, France or China to end up in the supermarket. He sells them to the factory and the factory sells them over to the international market. Very few farmers sell their cattle directly to any consumers outside of Ireland. The international price about which the Minister of State spoke happens after the factory. The factory sucks up massive profits and has been allowed to do so by the structure. I gave the example of a factory which makes hundreds of millions of euro in profit annually and pays 2.5% tax. That international price for beef is through the lens of the factory; it is on the other side of the factory. Factories having to take a little bit less per kilo and paying the farmer a little bit more per kilo is not going to change the international dynamic of the price of beef at all. Farmers are getting it in the neck at the moment from the Green Party and the environmental issue. Farmers have to stock so damn high because there is such little margin on each unit of produce. Imagine if they did not have to stock so much, got more per unit and could make living from less stock. That would have significantly less of an environmental impact. The solution to the environmental elements around farming could be solved by making sure farmers get a decent price. I am not talking from the position of People Before Profit or a hard left position of interfering with the market. This solution would fix the market. That is what the Government has been missing around this issue for the past five or six years. As a result, farmers are continually in flux and suffering price-wise.

Regional and rural Ireland is emptying out of its young people. The average age in Balbriggan is ten years lower than the average age in Killarney. Most people cannot make a living in rural Ireland. Shops are closing. I canvassed in a town about a week and a half ago and the individual at the door said that in the past ten years six pubs, two hotels and two banks had closed and you could not get a hot meal in the town. That is replicated throughout the country. In many midland towns at around 1 p.m., you could play hurling up and down the main street because everybody is gone out of that town and they are all in Dublin. They all do a three-hour commute in and out of Dublin every day.

There are two economies in this country. There is the greater Dublin area economy and then there the rest of Ireland. On many main streets, every second building is derelict, empty and falling apart. We have a spatial problem. Ireland is developing into a city state. Many solutions need to be used to push back against that. One is allowing farmers to produce world-class quality beef, poultry, pigs and sheep and get a decent wage. The costs do not need to be raised one iota at the checkout. All that is needed is proper distribution of power within the supply chain and, therefore, proper distribution of profits. Until that day, we will have the same situation. My Bill is an emergency Bill. It is not for the long term. This is not how a market should be structured in the long term but it is to give a foothold to farmers so they can properly negotiate with the beef barons who are bleeding them dry.

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