Ms Mairead McGuinness, MEP:

Two Senators asked about rural development funding. I am concerned because there is a feeling we could cut rural development and hold direct payments. We are fighting on the grounds that in a two pillar CAP one must have an adequate budget for both pillars. I have heard recent soundings, as we approach the meeting of the Heads of State and Government in February, that are little better than earlier, so perhaps we might not be as concerned. Until I see the figures I remain determined to push for an adequate budget for both headings of the CAP. If any cuts were made to the Leader programme naturally everything in rural development would be affected. This would be a real shame because the Leader programme is very much a bottom up ground level initiative and has helped to establish businesses.

The point on food labelling ties in with something I said earlier. Our way of making legislation takes time because it involves committees, plenary sessions, negotiations with Council, Commission proposals and then implementation in all member states. It can only be implemented on that date because of the legislative process. With regard to CAP reform we hope the Minister, Deputy Coveney, as president in Council will get an agreement by the end of June. We will not see implementation until 1 January 2015 because we will need time to make the changes.

Senator O'Neill raised a very interesting point about the number of people who used to be on farms.

We need to look back at how that was done and how it was that we could have a number of people living off a farm. In today's world, however, it is extremely difficult. I dare say that the trend in food prices over time has been the problem. Farmers will point out what they used to get for a sheep 20 or 30 years ago compared with now.

I heard the programme that Senator O'Neill mentioned and am aware of the fact that so many chicken products are imported. This concerns the issue of authenticity and what is happening in the food supply chain. In my view, food processors need to understand that for us to trust their products they must have a trusting relationship with all their suppliers. The idea of having blocks of frozen chicken or other meat, and pressing a button to get the cheapest option, is not appropriate in the food supply chain because we know of the practices that happen. We will have to ask the food industry to examine the matter to see if it is appropriate that this should occur.

It must be remembered, however, that we are also a major food exporter. Therefore, we do not want to say that it is all about our food because we want others to enjoy the quality of food we produce. We want it to be exported to the US, Europe or elsewhere, so we need a food supply chain that does not have any weaknesses in it. With a commodity like chicken - and Senators heard the report this morning - it certainly looks like that, as it operates now.

As regards young people in farming, in the Celtic tiger era everybody looked down on farming. There was no interest in it and people left the land. We had a great number of part-time farmers because the building trade helped and supported it. Money was invested in farms because there was a little more cash in hand. We now have a situation where younger people who like farming - and I think people have to like it, rather than being forced into it - want to farm. There is an opportunity with the abolition of milk quotas but it has to be about efficiency in farming as well, not just about having more cows. There are opportunities for young trained farmers to re-engage with the idea of productivity gain, which is referred to in the Treaty of Rome. We had perhaps forgotten about that idea in the switchover towards environmental concerns.

Senator Barrett asked whether subsidies are capitalised.