Breeda Moynihan-Cronin (Kerry South, Labour)
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Question 51: To ask the Minister for Agriculture and Food her views on the very small increase in farm incomes in 2004 as reported by the CSO which are not keeping pace with inflation; the proposals she has to improve farm incomes; the proportion of farm incomes which is derived directly from payments from her Department; and if she will make a statement on the matter. [14189/05]

Mary Coughlan (Donegal South West, Fianna Fail)
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In February 2005 the Central Statistics Office reported a 3% increase in aggregate farm income for 2004. It calculated that the value of the cattle, sheep and pig sectors increased by approximately 8.3%, 6.1% and6.2%, respectively. From an income perspective, the livestock sector had a reasonably positive year, with the dairy sector experiencing steady milk output and prices.

These improvements reflect continuing positive trading conditions on EU markets for beef with consumption within the European Union exceeding production, good national and international demand for sheep meat and strong pig prices, while steady demand for dairy commodities helped maintain milk prices. The consumer price index, which measures the annual rate of inflation in Ireland, increased by 2.2% during 2004 so the increase in aggregate farm income was marginally higher than the rate of inflation.

This increase in incomes should be viewed in a positive light when account is taken of the fact that a substantial amount of the payments on 2004 premia entitlements will be paid this year in conjunction with the single payment scheme. In the past few years an 80% advance was paid on many premia schemes. In 2004 only a 60% balance could be paid. Therefore, the 2005 figure will include a 40% balancing payment due on livestock premia compared with 20% in the previous years.

To underpin the financial stability of the sector, my Department operates a range of measures, including market supports and direct payments aimed at supporting farm incomes. In 1990 direct payments accounted for 23% of aggregate farm income. Since the CAP reform of 1992, direct payments to farmers have risen and by the late 1990s they accounted for 50% of aggregate farm income. Direct payments paid by my Department to the farming sector in 2004 amounted to €1.64 billion or 74% of aggregate farm income.

I have vigorously pursued the goal of supporting farm incomes by maximising the level of direct payments to farmers, ensuring that the European Commission utilises all available management tools to support the markets, and by providing the best possible development framework for the sector. These very substantial direct payments reflect the real commitment of the Government to support farm incomes. These payments are in addition to other forms of market supports and grant aid for investment in farm structures.

Mary Upton (Dublin South Central, Labour)
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I appreciate the statistics on the current situation of the entire farm industry. A significant factor is the large drop in the number of full-time farmers. The number of part-time farmers has increased accordingly, although not quite in the same proportion. What plans are in place to ensure the viability of those part-time farmers? Off-farm income will become more significant than it is currently.

Mary Coughlan (Donegal South West, Fianna Fail)
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I agree with Deputy Upton. As she is aware, the review carried out by former Deputy Alan Dukes indicates the number of farmers involved. That number is detailed in the reply to another parliamentary question, but I cannot locate it. There is a change in profile of farmers. Many of them are involved in part-time farming and it is difficult to get young people to enter farming on a full-time basis. There should be a balance between both.

I do not agree that anything below a certain livestock unit is uneconomic. While it may be uneconomic in some terms it has an economic advantage in that it is part of the fabric of our rural society and that is the way it should be. We have tried to provide the opportunity, through the single farm payment, to those who wish to expand to do so and decide the way they want to go forward when it comes to the development of their enterprise as they are not now tied into retention periods, stocking densities or whatever. The change taking place in respect of practical issues such as marts being held in the evening to support part-time farmers, the provision of education at night and similar ideas reflect what is now happening in agriculture. We should try to achieve a fair balance but we must give particular supports to the people in farming for the long haul, who wish to have a viable income, and allow them to develop and flourish. Equally, there is nothing wrong with part-time farming. It allows investment as a consequence of an off-farm income being available to farmers.

Denis Naughten (Longford-Roscommon, Fine Gael)
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I will give the Minister another statistic to consider as she has doled out many of them in the past few minutes. Since her Government took office in 1997, 70 farmers a week have left agriculture. In the context of the single farm payment post-decoupling and the proposals on the nitrates directive, farmers with less than 20 livestock units will be in severe difficulty, as will the large commercial farmers. In respect of the smaller producer, however, traditionally many small producers in some parts of the country would have used ring feeders for wintering out cattle. That can no longer happen. Teagasc must focus on alternative methods, whether in respect of storage, wintering of cattle and alternative products such as organic products.

In that respect, will the Minister ask Teagasc and the other Ministers, when she meets them, to reconsider the closure of the farm in Ballinamore, County Leitrim? It has a major benefit in terms of the type of marginal land, which could be used as a test farm to try out new enterprises that could provide alternatives for many of those part-time and small farmers in the western region, whether in respect of slurry storage, new wintering out procedures or alternative products, be they free range or organic.

Mary Coughlan (Donegal South West, Fianna Fail)
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I will toss back that low ball to the Deputy and also send him a curved one. The reason many people have left farming is that there are better opportunities available due to the good economic climate that has been supported and progressed by this side of the House.

John Browne (Wexford, Fianna Fail)
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They can do two jobs now.

Mary Coughlan (Donegal South West, Fianna Fail)
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They could do three jobs if they could get away with it. It is a little like ourselves, except we get the same salary.

On the other available initiatives, Teagasc has provided me with the results of some work on earthen banks. It is now preparing guidelines for me. In the next fortnight it will complete some more work with regard to alternative ways of wintering out cattle. That will be made available to me in the next few weeks, at which time it will be made available to everyone.

On the issue of 20 livestock units, I indicated to Deputy Crawford that I am anxious to deal with these issues.

Denis Naughten (Longford-Roscommon, Fine Gael)
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Answer the question, Minister.

Mary Coughlan (Donegal South West, Fianna Fail)
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Ballinamore is closed. It is for sale. The cattle have been slaughtered and I would rather not hear any more about Ballinamore. I say to people in the local communities and the county councils that Teagasc is favourably disposed to facilitating any community initiative people wish to progress. Much of the work that took place in Ballinamore has been transferred to Ballyhaise, which is just down the road.