Andrew Doyle (Wicklow, Fine Gael)
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Question 5: To ask the Minister for Agriculture, Fisheries and Food the steps he will take to support the sheep industry; the specific resources that will be allocated in respect of the sheep industry in 2009; and if he will make a statement on the matter. [37776/08]

Trevor Sargent (Dublin North, Green Party)
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The sheep sector is an important part of the overall agrifood sector and its future depends on its ability to meet the needs of the market. The sheep industry strategy development group and the subsequent implementation group set the blueprint for the sector's future development. Most of the recommendations fall to be implemented by the industry. However, the Department and the State agencies under its aegis are also playing an active role. Good progress is being made and the following is a summary of the main actions taken: payments of an additional €6 million to qualifying sheep farmers were issued under the national reserve; the Department secured European Commission approval for a new supplementary measure in REPS 4 to promote the mixed grazing of cattle and sheep and under this a farmer can qualify for an annual payment of up to €1,000 in addition to his or her basic REPS payment; the pedigree sheep breeding programme, as operated by my Department in co-operation with the sheep breed societies, is being transferred to Sheep Ireland, a sister company of the Irish Cattle Breeding Federation and an interim sheep board has been established to manage and oversee the transfer; a trial to examine the feasibility of mechanical carcase classification for lamb — the results of which are expected shortly — was conducted earlier this year and it is hoped that the system will allow for the accurate and objective mechanical classification of lamb carcases and that it will gain universal industry support; the lamb quality assurance scheme, which was established in 2007, has led to some 6,500 farms being registered to date; Bord Bia is continuing to organise strategic marketing campaigns in selected European markets and in conjunction with its French and British counterparts, it is undertaking a three-year generic lamb promotion on the very important French market to promote lamb to younger consumers; and Teagasc has developed a comprehensive plan to restructure its sheep support services, including a programme for technology evaluation and transfer farms, which includes hill and lowland areas.

These measures complement those to be taken by the industry in the implementation of the Malone Report. I am satisfied that our Department is dealing satisfactorily with the areas of the report within its remit.

Additional information not given on the floor of the House.

Turning to the resources that will be available to the sector in 2009, it is worthwhile first to recall that €27.5 million approximately was paid under the sheep headage scheme and €107.5 million was paid under the ewe premium scheme in 2000 and 2004, respectively — the last years of operation of such coupled payments. Those schemes are now incorporated into the disadvantaged areas and single farm payment schemes and sheep farmers will continue to benefit under these subject to compliance with the relevant conditions.

I will now outline other financial provisions that will benefit the sheep sector. In the case of REPS, sheep farmers can qualify for the mixed grazing supplementary measure of up to €1,000 and, where appropriate, qualify for the increased payment rates on Natura 2000 land, non-Natura 2000 commonage and on designated NHA land. Some €355 million has been allocated to REPS for 2009.

Under the 2005 national reserve, some 500 hill sheep farmers benefit to the amount of €400,000 annually or €2.8 million over the period until 2012. In addition, a special category was included under the 2007 national reserve for sheep farmers whose existing single payments are less than €10,000 and where individual entitlements are less than the district electoral division, DED, average. Allocations are capped at the DED average value of entitlements or a total single payment of €10,000, whichever is the lesser, and allocations to successful applicants will not exceed €1,000. It is estimated that this measure will be worth some €6 million annually or €42 million over the period until 2012.

The pedigree sheep breeding programme as operated by my Department, in co-operation with the sheep breed societies, is being transferred to Sheep Ireland, a sister company of the Irish Cattle Breeding Federation, ICBF. An interim sheep board has been established to manage and oversee the transfer. To facilitate this transfer and to allow for redevelopment of the breeding programme, funding of €163,000 has been provided to date in 2008. My Department will provide further financial support to ICBF in 2009 for sheep breeding.

A trial to examine the feasibility of mechanical classification for lamb was conducted earlier this year at a cost of €135,000. Additional funding at a similar level may be made available to carry out additional feasibility work, if required, in 2009.

The lamb quality assurance scheme operated by Bord Bia has 6,500 participants and it is hoped to expand this by a further 6,000 in 2009. This could involve spending of up to €1 million depending on uptake. In addition, Bord Bia will spend in the region of €1 million on the promotion of sheep and lamb at home and abroad in 2009.

Teagasc allocated approximately €1.5 million in 2007 and 2008 on sheep research activities and these will be continued into 2009. This also covers specialist staff for the sheep programme established following the sheep strategy group's report. It does not include additional funding related to the advisory service, some of which would be directed towards sheep.

Finally, the problems facing the sheep sector are well known at EU level. The Minister's predecessor ensured they were discussed at the EU Agriculture Council of Ministers in March. This was followed by the Aylward report to the European Parliament and a conference hosted by the French Presidency of the EU in September. These initiatives have kept the sheep sector's concerns to the forefront and, in the context of the current CAP health check discussions, we continue to pursue possible solutions.

Andrew Doyle (Wicklow, Fine Gael)
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The Minister of State referred to wonderful schemes, feasibility studies, marketing tools, etc. Why have sheep numbers decreased by 50% in the past ten years and 240,000 on the most recent 12-month calculation? The disadvantaged areas scheme provides sheep farmers with a direct fillip in the context of their incomes. The owner of a 45-hectare sheep farm comprising mountain-type land will lose €1,055 on foot of the cuts in disadvantaged areas scheme payments. A PAYE worker would want to be earning €100,000 and be charged a levy at 1% to incur the same loss.

The REPS 4 measure to which the Minister of State referred involves €28 million. In May, only €9,000 of it had been drawn down. The measure is unworkable and the Minister of State is well aware of that.

The Minister, Deputy Smith, stated that Peter would not be robbed in order to pay Paul. What will happen to the single farm payment modulation in the context of the proposed sheep welfare scheme? I guarantee those opposite that a proposal will be made to take that money and pay it out directly by way of some measure relating to sheep. The long-term aim is to end the disadvantaged areas scheme and transfer the moneys relating to it to some rural development fund under the control of the Department of Community, Rural and Gaeltacht Affairs.

Brendan Howlin (Wexford, Labour)
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The Deputy should ask a question.

Andrew Doyle (Wicklow, Fine Gael)
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I am doing so. In light of the statistics to which I refer in respect of sheep, how can the Minister of State say that everything is being done to protect the industry? What he said just does not add up.

Trevor Sargent (Dublin North, Green Party)
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There will be an increase of 8% in disadvantaged areas scheme payments.

Michael Creed (Cork North West, Fine Gael)
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The Minister of State is taking, on average, €1,000 off these people.

Trevor Sargent (Dublin North, Green Party)
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That amount might not be as much as people might like. However, we are doing our best within budgetary restraints that exist. We are not doing what the Deputy is attempting to do, namely, create a negative impression.

Michael Creed (Cork North West, Fine Gael)
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The Minister of State is not increasing it, he is decreasing it.

Trevor Sargent (Dublin North, Green Party)
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Deputy Doyle inquired as to why sheep numbers have decreased and he probably knows the answer to that question. As stated earlier, there is an issue to be addressed as regards the demand for sheepmeat. We must ensure that this demand increases.

Michael Creed (Cork North West, Fine Gael)
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Why is Bord Bia's budget being cut?

Trevor Sargent (Dublin North, Green Party)
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The situation is not helped by the fact that since the advent of single farm payments, farmers are no longer required to retain sheep for premia purposes. There was, therefore, a support based on numbers rather than on the areas in which the people affected were living.

Prices for the year are up by approximately 5% on last year. There has been a drop in recent weeks. This is a market-driven situation and the difficulties relating to it will not be solved by——

Michael Creed (Cork North West, Fine Gael)
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What about the €28 million?

Trevor Sargent (Dublin North, Green Party)
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——the provision of the kind of supports to which the Deputy refers. We must co-operate in respect of this matter.

Michael Creed (Cork North West, Fine Gael)
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What about the €28 million?

Brendan Howlin (Wexford, Labour)
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Deputy Creed should cease interrupting. He did not table this question.

Trevor Sargent (Dublin North, Green Party)
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I travelled to Paris in order to assist Bord Bia in its promotions because the French market is extremely important to Ireland. The reality is that sheepmeat is primarily being bought by older customers. We must try to bring about a change in that regard. This is the challenge we face. If Deputy Doyle has any useful suggestions to make, I would be more than happy to listen to them.

Andrew Doyle (Wicklow, Fine Gael)
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I received a reply to a parliamentary question I tabled yesterday regarding the number of sheep being slaughtered in Irish plants that originate in Northern Ireland, Scotland or England.

Brendan Howlin (Wexford, Labour)
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The Deputy is supposed to ask a question.

Andrew Doyle (Wicklow, Fine Gael)
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I am about to do so. In the reply I received yesterday, it is stated that in week 34 of 2006 some 3,964 animals were slaughtered, while 6,165 were slaughtered in the corresponding week in 2007. Does the Minister of State have any proposals to control the way in which the price in the Republic is controlled and managed by the processors in the context of the ebb and flow of the supply of meat they receive from countries outside the jurisdiction? It is a cartel.

Trevor Sargent (Dublin North, Green Party)
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I am aware of the reply to which the Deputy refers. There is no restriction with regard to sheep movements between the North and the South.

Andrew Doyle (Wicklow, Fine Gael)
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On a point of order, there are restrictions. It is not possible to export breeding sheep.

Brendan Howlin (Wexford, Labour)
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The Minister of State should be allowed to reply.

Trevor Sargent (Dublin North, Green Party)
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In terms of animals for slaughter, the Deputy is aware from the reply in question that Bord Bia promotes Ireland as the "Food Island".

Michael Creed (Cork North West, Fine Gael)
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Bord Bia's budget has been cut.

Trevor Sargent (Dublin North, Green Party)
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We do not have in place the restrictions that would be required if a problem arose. However, there is no such problem. We market the island as the "Food Island" and sheepmeat comes into the equation in that regard.

Andrew Doyle (Wicklow, Fine Gael)
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Not all of that meat originates on this island. Some of it comes from Scotland.

Trevor Sargent (Dublin North, Green Party)
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I take the Deputy's point. There may be a need to contact the authorities in Northern Ireland or Scotland in that regard. As already stated, however, we take a "one-island" approach.

The Malone report must be the point of focus for——

Michael Creed (Cork North West, Fine Gael)
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The provision of €28 million would be of more assistance.

Andrew Doyle (Wicklow, Fine Gael)
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There is also the issue of modulation.

Trevor Sargent (Dublin North, Green Party)
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——the industry, the Department and agencies such as Bord Bia. We are working through the recommendations contained in that report and this is where progress will be made.

Andrew Doyle (Wicklow, Fine Gael)
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It will be too late. There will be no industry left.

Michael Creed (Cork North West, Fine Gael)
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I hope the Minister for Agriculture, Fisheries and Food, Deputy Smith, will have more to say when he visits Tullamore.