Wednesday, 16 October 2002
Adjournment Matters. - Disease Eradication Schemes.
I thank the Cathaoirleach for accepting this matter and the Minister of State for being here to reply. I want him to investigate the circumstances surrounding the disposal of TB cattle belonging to farmers from County Sligo to a meat plant in Dublin, which has subsequently gone out of business. What steps will he take to ensure that the farmers concerned are compensated for their loss?
Since I tabled this matter on the Adjournment, I discovered that there are 191 farmers nationwide who found that they were not paid for cattle. In respect of the TB eradication scheme, the Department of Agriculture and Food licences haulage companies to take the cattle and also, under a tender process, licences the meat factories where these cattle are slaughtered. The farmers concerned have no say whatsoever in who collects their cattle or where their cattle go. Due to a problem that arose early last year under that scheme, cattle were collected from some farmers in my county and across the country and taken to a meat plant which, unfortunately, has gone into liquidation.
Some farmers have not been paid. There would be a greater outcry over the matter but for the fact that, for certain farmers, it involved only one, two or three animals. Unfortunately, a farmer in my county lost half his cattle – 18 animals – and this is a blow from which he is unable to fight back. That is why I am raising this issue.
I understand that farmers across the country are getting together to fight this case because I and they believe that there is an obligation on the Department to honour the debt owed to them. This is because they had no say in where the cattle were taken. The amount of money involved is around £200,000. We all know what will happen if the case goes to court. Half a million euro will be spent on legal costs and, ultimately, the farmers will be paid.
The disposal of reactor animals under the TB and brucellosis disease eradication schemes operates countrywide on the basis that meat factories tender on a weekly basis for the slaughter of these animals. The Department selects the meat factories on the basis of the prices that they offer for different types of animals.
The position in regard to the Department's schemes was that during 2001 and up to 1 April 2002, compensation for reactor animals comprised the salvage value of the animal, which was paid by the factory directly to the farmer, and a reactor grant or live valuation, less the salvage value, paid to the individual farmer by the Department. From 2 April 2002, the reactor grant regime was discontinued, when the valuation system was extended to all breakdown cases. It is important to note that, at all times, the ownership of the reactor animal continues to reside with the farmer and, therefore, the contract for the salvage value is a matter for the farmer and the meat factory involved. The Department's responsibility is solely to ensure the secure removal of the animal to slaughter and pay the appropriate reactor compensation thereafter.
In circumstances where a factory goes out of business, such as has happened in this case, the recovery of any losses incurred by farmers is a matter for resolution between the farmers and the company's liquidators. I understand a liquidator for the meat plant concerned was appointed in November 2001. The liquidation process is continuing and I am informed will not be concluded for some time. While no decision to compensate any of the farmers concerned has been taken, I am advised that to make such a decision at this stage would be wholly inappropriate from a legal point of view and any such decision should not be considered until the liquidation process has been concluded. While I have the utmost sympathy for those farmers who have suffered losses as a result of the closure of the plant, nevertheless, as I stated, the recovery of such losses is a matter for resolution with the liquidator and legally, even if we wanted to intervene, we are precluded from doing so at this stage.
I am pleased to note from the Senator that the farmers are getting together. They should do so and appoint a lawyer, and perhaps an accountant, to represent them and negotiate with the liquidator. On that basis they will all get equitable treatment on the residue available to the liquidator once he has disposed of the borrowings or other debt owed on the premises or the trading company. It is important that they be represented as a group because if farmers take an isolated approach, it will cost them money and their chance of getting an equitable settlement may be remote. If the Senator is able to provide us with a list of the names and addresses of those involved, we will keep them in mind in the Department's handling of this file.