Seán Connick (Wexford, Fianna Fail)

I have listened with interest to the comments from all sides of the House. I thank Senators for their contributions and especially for their engagement with the Food Harvest 2020 report, which we all agree represents an excellent blueprint to see the sector into the next decade. I wholeheartedly agree with the sentiments expressed by many speakers on the potential of the agriculture, food, fisheries and forestry sectors. The food and drink sector has significant potential as part of an export-led recovery. Export-led growth will play a key role in our economic recovery, not least for the reason that the agrifood sector has strong links with domestic economic activity and has a significant geographic spread. We hear much talk about stimulus, and the agriculture, fisheries and forestry sectors are a natural stimulus. We hope it is an area that can be protected in the budget in order that it can lead us from our difficult economic challenges.

The issue of the economic situation was raised by a number of speakers. We are living through challenging economic times. Through a combination of internal and external factors, the economy has suffered a sharp decline in recent years. To ensure we can develop a platform for renewed economic growth, we must address our fiscal situation. The Cabinet spent Monday and Tuesday of this week considering budgetary options for the December budget and for the multi-annual plan to meet our stated commitment of reducing our deficit to 3% of GDP by 2014. Difficult decisions must be taken but the aim is to ensure they do not have an unfair impact on any sector of society. This backdrop presents significant challenges for all actors with a role in developing the sector. The report is addressed as much to farmers, fishermen and industry as to the Government. While there will be significant resource requirements, the 2020 committee agreed that it envisages the prioritisation of policy from the report will be based on the re-prioritisation of existing resources as opposed to making new resources of State funding available. Regarding Government funding, the report offers a strategy and a vision to guide our prioritisation and the allocation of Exchequer resources. It is critical to ensure all Government and EU spending in the sector achieves maximum bang for our buck. Having a clear strategy to guide our choice of priorities is an important step to achieving that.

The immediate outlook for the agrifood sector is improving. Farm output has increased by €300 million compared with 2009. The value of exports, at almost €3 billion during the first five months of 2010, is almost 8% higher than one year earlier. This is good news for farmers, their families and the rural economy. It provides a positive and realistic platform from which to continue to grow. I was struck by the positive attitude throughout the development of Food Harvest 2020 and it creates a useful springboard to ensure the successful implementation of actions detailed in the report. Senator Phelan pointed out that money filtered down from the farmer and that when the farmer had money, everyone had money. This is a theory to which I aspire and which I can support. I have seen it at first hand. Senator Phelan is a neighbour of mine and lives not too many miles away from me. His late father used to buy his cars from my late father. The connection exists and the money filters down through the system. When the farmer has money, everyone has money and the economy benefits.

I refer to the impact the successful achievement of the goals set out in the report will have on employment. I also wish to expand on the subject of implementation, which was highlighted by many speakers. The increased output identified in the Food Harvest 2020 report has the potential to create further employment in the SME, artisan food and processing sectors. In light of countervailing trends in the processing sector towards further consolidation, lean manufacturing and rationalisation at primary producer level, however, further analysis is required to determine the precise net impact on employment levels. The initial estimates by Enterprise Ireland based on the output growth targets proposed in the report suggest a net gain of 3,500 to 4,000 jobs in the food sector by 2020 is possible. This more than counteracts the net loss of 1,500 jobs in the past decade.

Prospects of increased employment are also good in micro-food companies employing fewer than five employees. These micro-enterprises are generally not captured in statistics but are important local generators of employment and innovation. I was heartened by the response to Enterprise Ireland's call for food innovation vouchers which the Minister for Agriculture, Fisheries and Food, Deputy Smith launched with the Minister for Enterprise, Trade and Innovation, Deputy Batt O'Keeffe, during the summer. In excess of 100 food companies identified an innovation need and a third level research partner that can assist them in providing solutions using a €5,000 voucher. To date, 94 have been awarded vouchers. The clustering of food companies and the identification of areas of competition where distribution networks may be shared are also contributing to the resilience of the sector. The additional funding provided to Bord Bia from marketing initiatives and to Enterprise Ireland for lean manufacturing has improved competitiveness and contributed to the stabilisation of employment in the sector. A second cohort of 25 Bord Bia Smurfit marketing fellows have begun work with food companies. Individually, these are small steps but are well targeted and are producing direct gains that build capability and confidence in our capacity to achieve the ambitions set out in Food Harvest 2020.

Particular potential also exists in the sea fisheries and aquaculture sector for a step change in development and an increase in employment from 11,000 to 14,000 full-time equivalent jobs by 2020 and by capitalising on strong demand and adopting the strategy set out in the report. Senators McCarthy and Carroll referred to the aquaculture sector and fisheries. That is my area of responsibility and we have tried to work our way through barriers that prevent the development of the aquaculture sector and the job creation and export potential that exists. There is a multi-million market for aquaculture.

This brings me to the matter of action. While some reservations have been expressed about the implementation process, I emphasise my commitment and the commitment of the Department to delivering on the potential identified in the report. I refer to the Government assurances that it will do all it can to allow the sector to deliver on its potential. The Government has wholeheartedly endorsed Food Harvest 2020 and, in particular, the substantial growth prospects in the sector, recognising that the achievement of this requires the application of smart technology and processes, the necessary structural and operational changes to maximise competitiveness and the achievement, communication and branding of scientifically validated sustainability credentials.

We intend to ensure the strategy will be successfully implemented. I referred to the establishment by the Minister of a high level implementation committee to ensure effective, joined-up implementation, including consideration and prioritisation of how best to pursue the 200 recommendations made. This action group comprises part of the flexible structure put in place to ensure the appropriate actions are taken. The flexible structure will facilitate an action orientated working method, and the recently announced dairy expansion group is a good example of how this will operate.

On the dairy side, there is a clear need to take immediate and commercially sensitive decisions to ensure we expand production and have sufficient and competitive processing capacity. With that in mind, we have set up an activation group involving Teagasc, which has the expertise and best practice on maximising output, farmers, who are able practitioners and are best placed to assess the advice given and use it to increase production, and the industry chief executive officers, who are the key movers on ensuring streamlined, competitive processing capacity. This group must report back to me through the high level committee in November with its decisions. It is evident it is not just a talking shop. Rather, it is a focused action group representing the key actors along the food chain. It has a specific task to work collaboratively and constructively to arrive at the necessary decision within a short timeframe. This cohesive, directed action group is the best way to achieve the desired buy-in by participants to ensure the outcomes envisaged in Food Harvest 2020.

The importance of research and innovation was emphasised in the Food Harvest 2020 report as a prerequisite to achieving the growth targets for the agrifood sector. In response to the report and to ensure the agrifood industry continues to play a key role in Ireland's smart economy, the Minister recently announced a call for research proposals worth €10 million. This will include a joint firm-stimulus desk-based analysis to address the issue of competitiveness raised in the Food Harvest 2020 report. Those examples clearly highlight the urgency with which we are dealing with the priorities identified in the report.

Senator Mooney raised the issue of the Irish Dairy Board, the expansion of the dairy industry and who pays. On why only 60% of processors are involved with the Irish Dairy Board, the answer lies with the choice of individual processors and the paths to market they choose. That can be based on individual processors' commercial considerations but the Food Harvest 2020 report stresses the need for greater collaboration among stakeholders in the agrifood industry and dairy sector. The other question that arises is who is paying for the expansion. That is a key issue that is being examined by the dairy activation group.

I thank Senators for their suggestions and active engagement with this important debate. It is obvious each speaker places great significance on the potential of the sector and in ensuring it flourishes. It has been evident to me that there is a real intent on the part of all stakeholders in the sector similarly to step up to the challenge associated with the implementation of the report. Much hard work has been done to get us to this stage. I assure the House that the Government will do all in its power to ensure the growth and vision clearly identified in the Food Harvest 2020 report is fully achieved. That will ensure the sector's potential contribution to our economic, environmental and social well-being is maximised.