Paschal Mooney (Fianna Fail)

Cuirim fáilte roimh an Aire and I wish him continued success within the Department of Agriculture, Fisheries and Food.

As I only have a short time, I will cut to the chase. All sides of the House and the farming organisations have welcomed the thrust of the report. We are entering what I hope will be an exciting and challenging time for the agri-food industry in the next decade. Obviously, there are huge challenges facing both the Government and the farming organisations. A number of issues have arisen, particularly in the context of the conference held last week by the Irish Co-operative Organisation Society, ICOS. Questions were raised by some speakers at the conference which the Minister might be able to clarify. The chief executive of the Irish Dairy Board, IDB, Mr. Kevin Lane said it was nonsense that the organisation represented just 60% of the dairy industry. He went on to say the IDB accepted that it would have to, as he put it, walk the walk and prove that it could give the best return for dairy processors and farmers in terms of price.

Why are the other 40% of processors not involved with the IDB, given that the thrust of the Food Harvest 2020 report and mainstream agricultural policy is to try to market brand Ireland in a more cohesive, co-ordinated fashion? While the Stock Exchange is not the best example of logic and common sense, the only two shares consistently going up in value on the Irish Stock Exchange are the two food company shares, Glanbia and Kerry Group. The challenge facing the world in the next decade will not just be climate change but food security. Ireland, with its grassland production system and wonderful brand, is ideally poised to take advantage of this.

Why is it that only 60% of the dairy industry is under the umbrella of the Irish Dairy Board? A leading Dutch co-operative adviser and researcher, Dr. Onno van Bekkum, told the recent Irish Co-Operative Organisation Society, ICOS, conference that several recent developments in the Irish co-operative scene had intrigued him. Among these was the proposal to demerge Glanbia plc and Glanbia co-op. He asked why would Glanbia want to get rid of its US dairy business. He was quoted, "If you retreat onto your island, I do not think that would be a good decision". He pointed to the example of Arla and Friesland Campina and that the future for successful co-operatives was in the world.

Glanbia supplier and IFA dairy committee chairman, Kevin Kiersey, on the other hand explained the demerger proposal was motivated by a desire to take greater control and develop the co-operative's Irish business. Is this the right decision for Glanbia?

Another topic at the ICOS conference was the cost of required expansion in milk processing capacity. Farmers claim disproportionate costs could be imposed on producers. I welcome the increase in the price of milk from 20 cent to 32 cent per litre. It was criminal that those purchasing milk at 20 cent per litre were then selling it on with large mark-ups at the expense of producers.

The Irish dairy industry has the capacity to expand and take advantage of the ending of quotas in 2015. However, who will pay for what seem to be extraordinarily high investment costs to upgrade milk processing? The IFA president, John Bryan, recently said the 30 cent per litre cost was massively excessive. Based on recent investments carried out in the north east, he said the processing and other off-farm investment required should not exceed a quarter of that figure.

I congratulate the Minister for Agriculture, Fisheries and Food on issuing a strong statement today on what he described as ill-informed and inaccurate comments about late payments to farmers. He said farmers can be assured that single payments and the disadvantaged area payments will continue between now and next year. Much of the misinformation about these payments in the press needs to be challenged. One claim was that 10,000 farmers have yet to provide details of stocking density. The figures printed in yesterday's farming supplement to the Irish Independent were quite distorted using combined figures from 2009 and 2010 to include both the disadvantaged area payments and the single farm payments and arriving at a non-payment figure of €175 million when the figure is actually nearer €60 million for disadvantaged area payments.

The UK and Germany, among others, make no advance payments. Between March and June most other member states will still not have completed pay-outs but Ireland will have all its payments made by February. Ireland is only six to eight weeks behind in ensuring the new EU regulations relating to digitised mapping are strictly adhered to. The Northern Ireland agriculture Department will be fined €100 million, which amounts to one third of the disadvantaged area scheme budget, for overpayments due to poor mapping. If this were applied to this part of the island, it would mean a fine of €500 million. The Department of Agriculture, Fisheries and Food is to be complimented for rolling out the map digitisation programme successfully in this difficult year.