Olivia Mitchell (Dublin South, Fine Gael)
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Question 92: To ask the Minister for Agriculture and Food when compensation will be issued to sugar beet producers; and if she will make a statement on the matter. [3556/07]

Mary Coughlan (Donegal South West, Fianna Fail)
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The compensation package negotiated in the context of the reform of the EU sugar regime is worth in excess of €310 million to Ireland. It is comprised of three elements.

The first is the sugar beet compensation which has been incorporated into the single payment scheme with effect from 2006. It will be worth approximately €123 million to Irish beet growers over seven years. The second element is the EU restructuring aid for the sugar industry, which in Ireland's case is worth approximately €145 million. In accordance with EU regulations, the Government made certain decisions last July regarding the implementation of the restructuring aid, in particular the percentage to be reserved for beet growers and contractors. These decisions are now the subject of judicial review proceedings instituted by Greencore in the High Court. Under the EU regulations, the first instalment of aid would fall to be paid in June 2007. In view of the legal proceedings, it would be inappropriate for me to comment further.

The third element of the compensation package is the diversification aid, also provided for in Council Regulation (EC) 320/2006, worth almost €44 million in Ireland's case. A national restructuring programme has been prepared and submitted to the EU Commission, in accordance with the EU regulations, with a view to drawing down the diversification aid. The regulations provide that payment of this aid would commence in September 2007.

Denis Naughten (Longford-Roscommon, Fine Gael)
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In reality, farmers are getting only approximately a quarter of the available compensation, a far cry from the 60% to 40% split from the sugar beet crop return. Every farmer in Europe, whether he or she produces beet, gets the single farm payment, so that does not form part of the compensation package.

The restructuring fund falls due in June, but does the legal action currently being taken threaten that due date? Could it be the case, depending on how long the legal proceedings are ongoing, that the due date may occur later? Perhaps the Minister could clarify the matter.

Is the diversification fund separate from the legal action taking place, and will it definitely be paid in September, subject to the European Commission being satisfied with the proposals put forward? With regard to tax implications, the Minister for Finance has stated that more than 80% of the compensation package is liable to tax. Has the Minister discussed the matter with the Minister for Finance, as it would have major implications for farmers?

Mary Coughlan (Donegal South West, Fianna Fail)
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With regard to the judicial review and restructuring aid, the case is due to be heard on 1 May, and we all hope it can be finalised soon so we can proceed with the June date. We will have to await the outcome. The diversification aid of €44 million is separate from the disputed amount. The matter of tax implications is currently being assessed by the Department of Finance and I have held initial discussions with its Minister. We await the examination of the proposals forwarded by my Department for further discussion.

On the Deputy's question regarding the single farm payment and compensation, although people receive the single farm payment, they receive a differential in the single payment on the basis of compensation for the reduction in the price of sugar.

Denis Naughten (Longford-Roscommon, Fine Gael)
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I accept that, but everybody involved in the beet industry in the past receives that single farm payment. Discussions have been ongoing with Greencore and the Government has its golden share with regard to the disposal of assets. Will the Government put forward the case that at the time the property was disposed of to Greencore, it was undervalued because of the impact of the golden share? It is now an extremely valuable asset, which should be part of the case being put by the Government.

As a result of this issue, the growers and contractors were hard done by in only getting a quarter of the available compensation, when such a very valuable land bank was being made available to Greencore at a knock-down price.

Mary Coughlan (Donegal South West, Fianna Fail)
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It is important to reiterate that the Government made a decision on the basis of an independent report by Indecon, which took into consideration all aspects of the EU regime. On the basis of that independent expert appointed by the Government, it was decided to reserve 32.38%, which was €47.1 million, for growers and contractors. This sum was made up of €40 million for growers and €7.1 million for machine contractors, relating to loss of specialised machinery.

It is on the basis of this decision we are now being challenged, and it is completely inappropriate for me to make any statement on the matter. Although the Deputies on the Opposition side may smile, I am very aware of the implications of making any statement that could compromise the impartiality or independence of the decision made by the Government, even in the confines of the House. Although anyone would regret the dispute, that is the democracy in which we live. People are entitled to express their view and I hope the matters arising from the judicial review proceedings will be dealt with as quickly as possible.

Denis Naughten (Longford-Roscommon, Fine Gael)
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They got a very valuable asset for nothing.

Mary Coughlan (Donegal South West, Fianna Fail)
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The Deputy is a bit of an asset himself.