Denis O'Donovan (Fianna Fail) | Oireachtas source

I welcome this debate, as I welcome all debates on agriculture or fisheries. I heard the Minister's comment at the time but accepted it was a slip of the tongue, which can happen to any of us. I appreciate the correction he has made.

On the issue of sustainable agriculture, Fianna Fáil believes sustainable agriculture must involve a fair price for farmers who produce food in an environmentally sound manner. Farmers are the custodians of the land and must be recognised for their role. The Government has washed its hands of the issue and has failed to live up to the commitment of the Lisbon treaty in ensuring that farmers get a fair standard of living from the land. We call for an independent beef regulator to rebalance the power between the various actors in the market and for a special €200 per head beef genomics payment in 2015 to boost incomes. The Government's task is to create a strong, fair framework for the market to operate in so as not to leave farmers hanging in the wind at the mercy of big processors and large supermarkets. The Minister should prioritise working with the new Agricultural Commissioner, Commissioner Hogan, at EU level to place renewed emphasis on achieving a fair return for farm produce. There is a great opportunity for the Minister to do this.

In regard to the agrifood industry, the Minister has outlined the significant benefits this industry adds to the economy. The Rubicon of reducing the CAP budget has been crossed and the CAP will, inevitably, be further reduced in future years, no matter who is in power. This highlights the pressing need to emphasise a fair price for farmers in the future.

Looking at Pillar 1, single farm payments for Ireland have been reduced by €42 million per annum, from €1.255 billion to €1.213 billion, a 3.3% cut. However, if we factor in inflation at 7%, this is a 10% cut in real terms over the period. I know the Minister has done, as the late Jackie Healy-Rae used to say, "his level best" within Europe to get the best deal, but we must face up to the fact that Pillar 2 funding for Ireland, €2.2 billion, is a decrease of €313 million, a 14% decrease in funding. If we factor inflation into this, it is a 21% cut. This is hard to accept.

I have listened to the Minister in regard to the difficulties in the dairy industry. It is unreal to think that many farmers got out of milk because of the quota system imposed on them many years ago. Most of the dairy farmers in the part of west Cork in which I live have long got out of milk production and dairy farmers are scarce in peninsular areas. Now that the quota system is being abolished, there is huge fear and apprehension among farmers about what will happen. It is a terrible turnaround for them to think that if Teagasc predictions are anywhere near right, they could lose 10 cent per litre of milk. Most dairy farmers have spent large amounts of money and some of them have borrowed to develop their dairies and this vista will be difficult for them to live with.

I made the point in the House before that I would hate to see Ireland develop along the same lines as New Zealand, where major factory type farmers operate, milking 1,500 or 2,000 cows. If this happens here, we will reduce the number of active dairy farmers to approximately one quarter of the number we have currently. This would not be good for family farms and is not something we would like to see here.

The annual Teagasc income report 2014 recorded grave disparities in farm incomes, with dry stock farmers falling seriously behind their counterparts. Cattle rearing farms saw incomes decline by 22%, to €9,469 due to higher production costs associated with severe fodder shortages in the previous year. In particular, suckler cow farms are heavily reliant on the single farm payment to keep their heads above water. The gradual reduction in the staged farm payments will cut the ground from under their feet if the Government does not step in to ensure a fair price for their produce in the marketplace.

Farmers operate small businesses in effect and are extremely vulnerable to the economies of scale and market power of larger actors in the industry. Large supermarkets have used their buying strength to unilaterally reduce prices on a wide variety of produce by offering special deals etc. These short-term measures inflict long-term damage on the industry by eliminating margins. Supermarkets and processors need to live up to their responsibilities. The Government has a key role in ensuring this. Without a fair price to the primary producer, the entire food chain will collapse.

A number of factors, including labelling issues and processor manipulation, have created a sharp 12% reduction in beef prices, following hard on high prices for purchases last year. This is driving farmers under pressure over the edge across the country. Without going into too much detail on the beef crisis, there is a huge problem facing beef farmers. The Minister set up round table discussions with the relevant industry interests, which is welcome, but he must ensure he keeps on top of this issue. If the farmers producing milk, suckler cow farmers, or farmers producing calves and weanlings or farmers fattening cattle are not getting a fair price, there will be major implications down the line.

In the short term, a special €200 per head beef genomics scheme should be introduced, particularly for farmers in the suckler cow sector. This would cost approximately €107 million and would provide a shot in the arm for the agriculture economy in 2015, when payment support from the European Union will slip to an unprecedented low and other schemes wind up. I also have grave concerns about the operation of the new GLAS scheme and the maximum of €5,000 that can be obtained. Some time ago, the Minister assured me here that in so far as possible red tape would be reduced. Some of the farmers I met in the Beara peninsula recently have grave concerns, because without GLAS, previously REPS, payments, they will find it hard to survive.

The Minister is faced with many challenges, whether in the beef or dairy sectors.

We have a brilliant agrifood industry. I wish the Minister well in this regard. It is not easy to deal with all of these different issues, some of which are outside his control. He has a battle on his hands and I wish him luck with it. We should all wear the green jersey, fight for Ireland and fight for the farmers and try to get the best results for them. Whatever some people in this capital city might think, farmers do go through tough times, whether it is with weather, prices for milk or beef, or other ongoing challenges. I hope the Minister will do his utmost to ensure they get a fair return.