Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I am delighted to have the opportunity to initiate the debate on this important matter, namely, the future of the Common Agricultural Policy after 2013. Senator Carty requested such a debate some time ago. This is a very important issue for Ireland, as it will set the context and many of the conditions for the development of Irish agriculture in the years ahead and we need to demonstrate a strong and unified position on the issue. I will begin by outlining the background to and context for the debate on the future of the CAP after 2013. I will then summarise the main issues arising and the developments that have taken place to date. I will also share with the House the Irish view on the matter.

Negotiations on the CAP after 2013 are taking place against the background of an EU budget review and a new EU financial perspective for the period 2014 to 2020. The budget discussions will have a major influence on the amount of funding available for the CAP and the distribution of funds between member states. There will be competing pressures for funds, including strong pressure from some sources for a smaller share of funds for the CAP, both as a share of the budget and in absolute terms. Even though formal discussions have yet to commence on the future EU budget, the pressure already is building in this regard. An early draft Commission paper from November last advocated major policy changes and lower funds for the CAP. It is an early draft but it clearly indicates at least one strand of thinking on the future.

Another new factor in the forthcoming discussions on the future of the CAP is that they will be subject to full co-decision by the Council and the European Parliament. It will make for a more open and democratic process but will be a learning experience for everyone because it is new. Already, the European Parliament is active in these negotiations and a recent draft of an own-initiative report generated approximately 782 proposals for amendments. Clearly the interest and attention of the European Parliament will be fully engaged as negotiations progress.

As to the timing of the negotiations, a formal communication from the Commission is expected towards the end of this year with legal proposals foreseen for the middle of 2011. A first round of formal negotiations will commence on the communication, leading possibly to the agreement of Council conclusions, while the more intense phase of formal negotiations will commence once the legal proposals are tabled. Parallel with this process, the negotiations on the EU budget after 2013 are expected to get into full swing later in the year, again with formal legal proposals in mid-2011.

Although formal negotiations will not commence until later this year, there has been a high level of activity on the subject of the future of the CAP over the past two years. The French, Czech, Swedish and Spanish Presidencies have organised policy debates on the general aspects of the reform and on the specific strands of the future policy on direct payments, rural development and market management measures. These policy debates have illustrated the complexity of the issues and the diversity of views among the 27 member states. It is telling that Presidency rather than Council conclusions were agreed under the French and Czech Presidencies as unanimity could not be achieved. Moreover, the Swedish and Spanish Presidencies did not attempt to obtain agreement on Council conclusions. In addition to the formal policy debates by EU agriculture ministers, there has been a large number of bilateral and other informal meetings and contacts and a substantial number of position papers have been produced by member states, stakeholder organisations and research authorities.

I am conscious that a broad orientation and direction for the future CAP will emerge during this informal phase of negotiations and with that in mind, my Department and I have been fully engaged in this informal process. I met the new Commissioner for Agriculture and Rural Development, Dacian Ciolos, shortly after his appointment and we will have further discussions later in the year. I also had meetings with my colleagues from some of the other member states. In this regard, Ireland was one of a group of 22 like-minded member states that signed up to a declaration in Paris in December last on the importance of a strong and properly resourced CAP in the future. Ireland was one of the leading member states in putting together that document. In addition, at official level we have had contacts and discussions with colleagues in other member states and with the Commission. The Department also has conducted a substantial amount of in-house analysis on issues primarily related to the single farm payment and this work is continuing.

I also have been engaging widely on the domestic front to ensure we in Ireland develop a strong and unified position with regard to these negotiations. I launched a public consultation process in July 2009 and sought stakeholders' views on the policies that would serve Ireland best in the years to come. I was pleased with the number and quality of the submissions received and I will use them to inform the Irish position on these negotiations. Almost 60 submissions were received and they contained a strong emphasis on the need for a robust and well resourced CAP in future to meet food security needs and preserve family farming in Europe. There was a marked preference for retaining direct payments but I noticed differences in emphasis that ranged from retaining the current historical model to updating reference periods and moving to flatter differentiated rates. There was some support for focusing payments more towards the delivery of public goods, including the environment, high nature-value farmland, cultural heritage and animal welfare, but this must be balanced against corresponding calls to maintain and index-link the current regime. There was almost universal opposition to modulation and to co-financing of core EU support payments and there was some support for payment ceilings and for confining payments to active farmers. A number of stakeholders called for re-coupled payments for vulnerable and strategic sectors and there was a good deal of support for the introduction of grassland payments. There also was a strong emphasis on the need to retain adequate market support mechanisms and for an additional mechanism to address increased price volatility. I believe that is an issue to which we must attach increasing importance.

Following this initial consultation process, I recently established a consultative committee to advise me on the CAP after 2013. The committee is comprised of all the major farming and agriculture-related representative organisations involved in social partnership, as well as a number of academics and it will hold its first meeting next week.

The Commissioner for Agriculture and Rural Development, Mr. Ciolos, already has launched a public consultation process providing an opportunity for all stakeholders and any interested party to give their views on the future of the CAP. The Commissioner has posed a number of high-level questions intended to focus discussion on the broad social benefits of the CAP, as well as the specifics of the reform. My Department has written to interested stakeholders in this regard, advising them how to participate in this consultation process and encouraging them to do so to ensure that Ireland's voice is heard at every opportunity. Commissioner Ciolos will host a conference in July to discuss the findings from these consultations. I take this opportunity to encourage as much participation as possible in this process. Members, through their work at constituency level and in this Chamber should encourage people to participate as much as possible when they have the opportunity to put forward their own viewpoints. The Commissioner has accepted my invitation to visit Ireland and that meeting is now scheduled to take place in September. I look forward to impressing on him the firm Irish view that there must be a strong and properly-funded EU agriculture policy after 2013. I will be involved in the all-party Oireachtas committee on agriculture and rural development for that visit and I hope the Commissioner will be in a position to meet and address it.

Having set out the context, background and recent developments in the negotiations, I wish to deal with the main issues that are emerging and to explain the Irish position regarding these issues. As regards the general orientation of future policy, there is good support among European Union agriculture ministers for a strong and properly resourced CAP after 2013. This was the main conclusion of the aforementioned meeting of the group of 22 like-minded European Union agriculture ministers in Paris in mid-December. My over-arching view is that I am conscious of the importance of ensuring security of food supply and maintaining family farming in Europe. However, particularly as Ireland is an exporting country, I also am conscious of the need for competitiveness and innovation and all these points should be reflected in the future CAP.

Full decoupling has been a success for Ireland and I remain committed to that approach. The continuation of a strong decoupled direct payments system is fundamental to stabilising farm incomes at times of market volatility. Decoupled payments remain the best way of underpinning the incomes of small family farms, while allowing them to respond to market opportunities. It is important to recognise the linkage between the income stabilisation role of direct payments and the market stabilisation role of our current market management measures. Staying with market supports, existing market support tools are appropriate and I believe there is broad agreement on this point among member states. One must retain the capacity and flexibility to react promptly and effectively to market instability and price volatility. The need for such measures was evident during 2009 in particular, when one reflects on the difficulties faced by the dairy sector. The application of intervention and aids to private and public storage in the dairy sector during 2009 illustrated the usefulness of these measures in contributing to market recovery and stabilisation, albeit at very low prices. These mechanisms should remain in place. I believe that, while they may require some adjustment, for example, in terms of periods of application and volumes, they are pitched at safety-net level at present and should remain available after 2013.

In addition to the current market supports, there is an increasing emphasis on risk management mechanisms and close examination of the possibilities offered by such measures is required. Ireland does not possess much experience of insurance systems and consequently is cautious about the benefits of establishing EU-wide insurance regimes.

Our main concern is that the diversity of production systems and range of risks across the 27 member states are too wide to accommodate a single EU-wide scheme. Therefore, I would like to see a suite of options available to member states to use at their own discretion within funding limits. There is also a need to address increased market volatility and we must have effective mechanisms to manage this. We should consider the potential usefulness of new additional tools to combat increased market volatility. In that regard, it might be worthwhile to consider in more detail the mechanisms used by other countries such as the US, particularly those concerned with underpinning farm revenue or income. I am not suggesting that we immediately adopt similar measures in the EU but we should certainly examine them to see whether they would deliver benefits on the EU market. I also want to ensure future policy continues to recognise and reward the high standards that apply to agricultural production in the European Union. Above all, this policy must be simple and not encumbered by unnecessary bureaucracy.

In summary, I want a CAP in the future that is based on the twin goals of competitiveness and sustainability, that is simple to justify to EU taxpayers, simple for farmers to understand and operate and simple for member states to implement and enforce. There is good support from the Agriculture Council for my position on the general direction of the CAP and I am encouraged by this.

With regard to the last few remarks, the agricultural community in general at Government level and at representative organisation level throughout the European Union has failed to get the clear message across to the citizens of Europe at large that the 495 million citizens of the European Union are all beneficiaries of CAP with regard to food security and the provision of public goods. We often read simplistic national media commentary that the Common Agricultural Policy is only about support for the farming community. It is not, rather it is about supporting all the citizens of the European Union. That is a message the new European Union Commissioner to anxious to get across to enable us to strengthen our case to ensure we retain our share of the budget.

The single biggest issue now emerging is the amount of funding that will be available after 2013 in view of pressures to reduce the EU budget and the share going to agriculture, specifically Irish agriculture. The key context for Ireland is food supply and sustainable management of natural resources, including climate change. We need a coherent approach to this based on the family farm structure. There is good support for the Irish position, namely, that we need a strong and properly funded CAP after 2013, and I will continue to press this point in the negotiations.

There is also pressure from the new member states for redistribution of funds in their favour. They believe that the use of the reference period 2000 to 2002 to calculate payment levels militates against them. They have called for abolition of the historic model and the application of flatter rates of payment across the European Union. They and others take the view that the further in time we move from the reference period, the less credible the historic model becomes. I am prepared to look at all options on this, but I will also require our partners in Europe to be equally realistic in their expectations. A debate which focuses solely on the distribution of direct payments without any reference to other EU funding would not be balanced.

Ultimately, the distribution mechanism must be fair and must underpin the goals of competitiveness and sustainability. However, fair does not necessarily mean equal. Any new mechanism must take into account the wide diversity of farming between member states. Pillar 1 direct payments are income supports and we must recognise that the cost of living and cost of farming vary widely throughout the 27 member states.

There is some tension between those who see a primary purpose of the CAP as being that of a guarantor of food security, income supports and EU family farming and those who see the function of the future CAP exclusively as a supplier of environmental and other public goods. It is clear there will be renewed emphasis on the delivery of public goods in the CAP of the future. There are positives for Ireland in all of this and we should not shy away from the debate. However, we must be vigilant at all times to ensure this does not come at the expense of the income support function of the direct payments system.

Many of our partners in Europe are now questioning the credibility of the historic basis of direct payments. The starting point for Ireland is that we see no compelling reason to change from the current historical model for determining single payments. We see the historical model as having a distinct advantage in linking the payment with level of farming activity, albeit activity in the 2000 to 2002 period. That having been said, it appears that Ireland is in a very small minority of member states that hold this view and we need, therefore, to be open to looking at alternative models that might command the support of a larger number of member states but would be beneficial to our country. While I am prepared to look at the alternatives, especially if other countries move from the historic camp, there is a need, however, to find a basis that is acceptable and fair to all member states and that meets our objectives of improved competitiveness and sustainability.

There are no concrete proposals as yet on this matter but it is clear that most member states, including ourselves, are carrying out analysis to determine which system might suit us best. From our analysis so far, we know that Ireland would lose out under a simple EU-wide flat rate by nearly 20%, based on current European Union single payment scheme funding levels. We also know that movement to a regional or national flat rate in this country, based on our current national envelope, would broadly have the effect of shifting funding from farmers in the east to the west and from cattle fattening and tillage farms to cattle rearing and sheep farms with little change on dairy farms. It is clear that there is a long way to go in this debate and that we will seek to have the option to maintain our current system and, failing that, to ensure there is a fair and equitable division of funds that supports family farm incomes in Ireland and allows our farmers to get on with the business of farming.

The positioning and status of rural development funding will be an issue, including whether elements should be integrated with cohesion-regional policy and whether the current structure with three axes of competitiveness, environment and diversification remains relevant. The new challenges identified in the CAP Health Check, namely, water management, bio-diversity, climate change and bio-energy, will again feature and there will be a greater emphasis on measurable outcomes. The core purpose of rural development policy is to support farmers in developing their productive capacity while securing the environment and ensuring the well-being of the wider rural society.

I support the continuation of a two-pillar structure. Our recent revised rural development programme shows a clear focus on competitiveness in the form of targeted investments and sustainability in the form of a new agri-environment scheme with clear benefits for all. This points the way forward for that pillar. Axis 1 measures, particularly those directed at investment and which promote competitiveness, perform a pivotal role in encouraging efficiency and innovation in farming for the future. These measures are critical to the future of Irish and European farming and should be maintained and enhanced.

It is very early days in these negotiations and we have a long way to go before the final outcome emerges. For me, the important issue is that we are well prepared and that we speak coherently and consistently with a unified voice. The negotiations ahead will be very difficult but I am determined to ensure the best possible outcome for Irish agriculture. I do not need to remind Members of the importance of agriculture to the Irish economy. It is our biggest indigenous industry and we have much to gain from a successful outcome.

Paul Bradford (Fine Gael)
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I welcome the Minister and thank him for being present. I and many of my colleagues on both sides of the House have sought this debate for a number of months because we recognise, as the Minister fully does, the importance of this debate, the necessity of getting, in so far as is possible, a broad consensus on what the Irish negotiating position should be and to try to succeed at Brussels level, first, in securing sufficient funding for Irish agriculture and, second, in attempting, and it is to be hoped succeeding, to distribute that funding in the fairest possible way.

The Minister spoke in his concluding remarks about the need for Ireland to speak coherently, with which I very much agree. That is the reason it is necessary to achieve some balance and consensus in our approach. The Minister spoke about the need to do so with a unified voice. While it would be pleasant if we could achieve this quickly and effectively, it is, perhaps, not possible to do so. We must be realistic, given the range of views, opinions, choices and alternatives being presented, not alone by farming organisations but also countrywide. On this occasion we need to listen to everybody. The loudest and strongest voice is not always correct. It is important the Minister is in a position to take with him to Brussels an overview of the thinking of every farmer and farm family on these proposals and how they wish to see him representing their views and concerns.

On where we should be attempting to move to, I suggest we should be seeking what I describe as the blessed trinity of the three Fs - food production, food quality and farm families. That is what this debate should be about and what we should aspire to achieve. We must be able to assure not alone the people of Ireland but also the people of the European Union that the package, when agreed, be it in 2011 or 2012, will secure adequate food production on the continent of Europe, that it will be food of the highest possible quality - it is imperative in today's environment that food is of the highest quality - and, from an Irish perspective, that we will put in place an agreement that will keep farm families active and as the cornerstone of Irish agriculture.

The one dramatic change on the agricultural map of Ireland since our joining the European Union in 1973 has been the huge reduction in the number of farm families. In a sense, this is part of the price of progress. I can safely say that when I entered politics, there were a number of dairy farmers in every townland. Now there is possibly only one in most townlands. If this trend continues, we will arrive at a situation in ten, 15 or 20 years time where there will be only one dairy farmer in each parish. The same applies to beef farmers and the tillage sector. Pig farmers have almost disappeared, while the sheep sector is under pressure, notwithstanding the arrangements the Minister recently put in place. We must aim high in attempting to ensure we maintain as far as possible the highest number of farm families.

When attempting to sell and defend the concept of the Common Agricultural Policy, it is necessary that we reflect a little on from where it has come. The policy was put in place on the continent of Europe in the aftermath of the Second World War when the population of western Europe was virtually starving. It was a time when there was not enough food being produced for the tables of Europe. The primary purpose of the original policy was to give to the peoples of Europe a solemn commitment that they would never again suffer food shortages. In this regard, the policy has been a success. Since its introduction, there has been an abundant supply of food across the Continent. We have also been able to produce a surplus amount which we have been able to export, creating jobs in the process.

There is a fallacy which dominates some of the debate in the press on the Common Agricultural Policy in terms of the cost of supports for agriculture. When one reflects on the fact that the cost of the policy amounts to approximately 0.5% of the entire GDP of the European Union, one can submit extraordinary value for money is being obtained. We are putting on the tables of Europe food of the highest quality and safest standards at a competitive price. Today the average family spend on food as compared with that in 1973 when Ireland joined the European Union is significantly less on a percentage basis of family income. The Irish and European consumer is getting excellent value as a result of the farming policies put in place under the policy which has secured food supply and assures us that there will be no food shortages in Europe, all of which is done at minimal cost to the European taxpayer. The big spin-off, notwithstanding the disappointing drop in the number of farm families, is that farming in this country and across the continent of Europe continues to employ tens of thousands, perhaps millions, of people. The spin-off in the agri-industry is enormous. This is what the Minister and his colleagues must focus on as they continue to debate the future funding of European agriculture.

That the European Parliament will have a significant role in the negotiating process creates a new political arena. Traditionally, in the negotiations at the Council Prime Ministers and Ministers for Agriculture make arrangements in smoke-filled back rooms. That was how business was conducted and how politics and European arrangements were decided. Now, under the more transparent political system put in place as a result of the Lisbon treaty, the European Parliament will co-decide how agriculture is to be funded in the future. This presents significant new opportunities and challenges, as it is no longer a question of satisfying 27 Ministers and Prime Ministers but of reaching an agreement that will garner the support of almost 800 MEPs from the west of Ireland to the Urals. It will be a difficult task to put together a package that will satisfy all contrasting demands. I appreciate, therefore, that the Minister is facing a serious task, in regard to which we want to work with him. My colleague, Deputy Creed, stated in the other House that this was a green jersey issue, on which we will all work with and for the Minister to secure the best possible deal for Ireland.

Fine Gael has held a number of public meetings across the country on the issues involved. I held such a meeting in Fermoy a number of weeks ago and was pleased when hundreds of people turned up to listen to outside speakers discuss the various options. Another meeting was held in Charleville on Monday night, to which the same applied. Farmers and farm families are anxious to part-take in the debate, offer their views and hear the Minister's. The Minister is facing a serious challenge, but there are also opportunities and choices. Unfortunately, however, we will not be able to arrive at a solution that will make everybody happy, as there are many strands of opinion across the country on direct payments, reference years, allowing new entrants into agriculture and modulation, all of which are tough issues, in respect of which it will undoubtedly not be possible to make everybody happy. We must ask ourselves what should be our aspirations and what funding and programmes should be achieved at the end of the negotiations. As I stated, it is crucial that the issues of food quality and production and the retention of farm families remain top of the agenda.

How does one travel this journey? The historical payments system is supported by many of our constituents who benefit from it and wish to see it retained. The Minister has couched his language in terms of his thinking on the issue. I am aware that his official position and, to the best of my knowledge, that of Fine Gael is that we should fight to retain the current system. However, we must be realistic and truthful. It appears Commissioner Ciolos and many others have indicated that the current system and payment method are not alone up for review but also change. If that is the political message from Brussels and a decision in this regard has already been made at that level, we will need to show flexibility in the policies we advocate.

Our first task - it will be a major one - is to secure the strongest possible national envelope of money. If my figures are correct, we benefit from a sum of approximately €1.5 billion per annum in direct payments and approximately €1.8 billion in total. Our bottom line must be that we secure that level of funding. We must also concern ourselves with the political pressure being applied to introduce co-financing which we must strongly resist because we know our economic situation is far from being as strong as we would wish it to be. We know in regard to the REPS and other EU programmes under which co-funding is required, we may not be in a position to submit the matching funds. Co-funding of agricultural grants and support mechanisms could be disastrous for Ireland and in so far as is humanly possible we have to try to keep away from it.

I need not tell the Minister that step one is to maximise the budget, which will be difficult. The politics of the issue with the input of MEPs could pose certain problems in that regard. I take some consolation from a recent survey of public opinion conducted throughout Europe which indicated that the view of farming and farm families and the need to support farmers under the Common Agricultural Policy was at an all-time high on the continent of Europe. There was a time in the late 1970s and 1980s when the concept of funding for agriculture was seen as a big negative at European level and there was a wrong impression that virtually all European funds were going towards supporting agriculture. Now the European consumer knows better and the value of the European taxpayer's investment. It is significant that this Europe-wide poll showed very strong support for a continuation of the assistance made available to agriculture. I hope this will make slightly easier our task of trying to secure the strongest possible national envelope. Once it has been secured - I hope it will at least be at the current level - we must discuss distribution. Support must be maximised for those actively engaged in farming, particularly farm families. We must also ask ourselves what we can do to assist those who, owing to being in the wrong place at the wrong time, do not benefit from historical payments. What about farm families who receive virtually no assistance and may have a son or daughter who wishes to carve out a future in Irish agriculture for himself or herself? This issue must also be examined.

At some meetings I attended a minimum payment was mentioned. Controversially, a maximum payment has also been mentioned. It is very easy to receive a strong round of applause at a public meeting when one speaks about the amounts received by the Queen of England, Larry Goodman or Greencore. Millions can go in cheques to individuals or groups such as these.

There appears to be radio interference by the Kilkenny world service and Senator John Paul Phelan at the back-----

Rónán Mullen (Independent)
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Wild and windy air.

Paul Bradford (Fine Gael)
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Yes, as has Deputy Hogan. This is a simplistic reaction because if one was to exclude the top four, five, six, eight or ten people, it would still not solve the problem. However, I do not have the answer as to how we should divide the spoils. Many are very happy with the current system because they are the beneficiaries. However, a huge number of people do not benefit as strongly as they believe they should and they tell me and my colleagues that they want to see a change. One group which has emerged very strongly in the past six to 12 months in presenting such a demand is that of smaller dairy farmers. As a result of falling milk prices, they have seen their incomes disappear and, unfortunately, many of them have decided to leave the agriculture sector. They tell me there should be a floor or minimum level of EU support to keep a farmer with 20, 30 or 40 cows engaged in farming. It is one of the many competing demands and questions which the Minister will have to attempt to answer.

Ireland entered the European Economic Community in 1973 and the first huge agricultural policy change - the quota system - was introduced in 1983. It caused controversy and difficulties for persons on the wrong side of the line but people adjusted in so far as they were able to do so. Now that regime is about to come to an end and the circle of EU policy keeps turning. I appeal to the Minister that, in whatever deal is reached, we try to be very proactive in reducing the level of bureaucracy and red tape. I know this is a cliché but bureaucracy and red tape cost the Department and Irish farmers a huge percentage of grant aid. We should be able to reduce significantly the amount lost owing to bureaucracy and red tape.

I ask the Minister to be cautious in the debate on modulation. The concept of rural development and behind programmes such as the LEADER programme is a positive one. However, robbing Peter to pay Paul is not what we should be about. We must try to secure sufficient funding across the programmes in place for rural development, but it should not come from Pillar 1 funding sources.

We have to be conscious of the fact that the environment is very much at the top of the agenda for many and that the carbon issue is of great concern. European and Irish agriculture, under forestry and other programmes, play a very significant role in dealing with the carbon crisis and can continue to do so. I hope this issue and the broader issue of the funding of the REPS can be worked into the provision of more mainline supports for agriculture when the final package is put together.

The Minister will appreciate that we could all speak for some time on the issues involved. We do not yet know the answers, but it is important that we start to pose the questions to ourselves and each other, as perhaps we might find a jig-saw of ideas and solutions which the Minister could present in Brussels. I appreciate the challenge posed. I know that at Commission level there is a view that change is required. We must live in the real world. There is no point in the Minister, me or anyone else telling farmers that there will not be a change when deep down in our heart of hearts we know there will be. We must manage that change and secure the maximum funding which we must try to allocate as fairly as possible. We must provide for active farmers and farm families to enable them to continue farming. We must also aspire to ensuring an opening for new entrants. Every industry needs to sustain itself with new blood. As such, we cannot shut the door on new entrants, whether it be in the dairy, beef or tillage sectors.

I am sure we will debate this matter further. It is the type of issue on which we need to reflect every few months as messages are received from Brussels and when there are views and indications of where the various partners stand and we need to respond. The Committee on Agriculture and Rural Development in the European Parliament has presented its first report, as has the socialist group in the Parliament. I presume the other groupings will do likewise. This is a crucial debate for Ireland and it is vital that we secure the best possible deal. I genuinely wish the Minister well. It is possibly the most important set of EU negotiations for Ireland since 1972 or 1973. It is crucial that we achieve the best result in the talks.

Joe O'Toole (Independent)
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I welcome the Minister and appreciate his comments. I go along with the points Senator Carty made. Since I became a Member of the House 23 years ago, time and again I have praised the work of various Ministers and a number of our Commissioners who fought hard to defend Irish agriculture. I hold the Irish Farmers' Association in great regard but I regularly say it should show more appreciation for the work that has been done. I mention also Ivan Yates who did trojan work. We have been well served by the Minister and his predecessors.

Europe has found a better direction in recent times. We must say to the farmers of Ireland that there is a growing market for food in the world and, therefore, the prospects, if properly handled, directed and regulated, are optimistic. However, it is hard to convince farmers of that because they have not got a very good deal in recent years. There is a slight improvement this year, which is good to see.

One of the great problems with the Common Agricultural Policy was that it turned on its head centuries old activities, directions and objectives of agriculture. For the first time, we started to pay people not to produce and to compensate people to do the reverse of what they learned over many years. That was the time we started to develop wine lakes and butter mountains and to have excess beef etc. At least we have moved away from that, which is very important.

There are issues we must address in that regard. The Minister spoke about the importance of agriculture as part of the infrastructure of this country not only in terms of jobs but of community. The further west one goes from the east coast, the more we see that. Not only do we have a huge economic investment in, and commitment to, agriculture but there is a community issue there, which is hugely important.

What we are discussing is crucial in terms of rural development. The money which goes to farmers is the life blood of much of rural Ireland and that is why we need to address it from that point of view. I completely support the views of the IFA in terms of focusing on sustainable agriculture, sustainable farms and on attractive lifestyles in order that young farmers and new farmers are attracted to and remain in the industry. That is hugely important.

I refer to the question of sustainable food. Our interests have been very well represented in Brussels and elsewhere but we are missing out on practical things. When in other countries, I walk through markets and look at what is happening in their agriculture industries and at how their farms operate. Our best support has always been from France. Anybody who has ever travelled through France will know what a vast agricultural country it is with its dairy-related industry in the north, a huge cereal growing area in the middle and a wine industry in the south. When I walk into a market in France, I wonder whether it is in Europe. I see shiny and beautiful vegetables on display in French supermarkets, farm markets and street markets which would not be allowed in the door of the Dublin market because they would not fit through the sorter. This happens all the time. We are shooting ourselves in the foot. The French take the correct approach. When French people buy vegetables they do not necessarily seek out seven tomatoes of the same size and shape. They know what they are looking for and instinctively buy what looks good and healthy, which we do not do.

I told the Minister of State with responsibility for food that if nothing else was done in agriculture during this term, the single most important change would be the repeal of the Abattoirs Act.

John Paul Phelan (Fine Gael)
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Hear, hear.

Joe O'Toole (Independent)
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This legislation has wrecked the beef industry in small towns all over Ireland. When the Minister and I were young, our mothers or grandmothers would send us to the local butcher to buy a piece of meat for the Sunday roast. The butcher would ask us to tell our mother that the meat came from a farm down the road owned by Brendan Smith who bought the calf from John Carty. While this may be an entertaining point, it is also a serious one. We need to return to those times, albeit not by dropping hygiene or cleanliness standards in abattoirs. If a farmer brings an animal to an abattoir for slaughter, it is pot luck whether the meat returned to him will belong to his animal. People may argue that is completely wrong but the meat comes back wrapped in plastic and it would take a rare genius with the wisdom of Solomon to know whether it had anything to do with the animal delivered to the abattoir.

The Minister should consider the possibility of having State owned abattoirs established in provincial towns to enable local butchers or farmers to rent a chiller and slaughterhouse for a couple of hours a few times each month or week to do their business as they once did. Another approach would be to persuade butchers to organise themselves in local towns but they would never do so.

A serious issue arises in terms of how we do our business. The Minister did not refer to the amount of food that is thrown away, an issue he discussed previously in the House. Food items purchased in supermarkets are labelled with what is known as a "best before" date. I ask the Minister to acknowledge that the use of these dates is a load of nonsense. When the Minister and I were young if one wanted to know whether milk was drinkable, one stuck one's nose into the jug and one knew quickly enough if one could drink it. One did not have to look for a date printed on the bottom of the packaging.

I do not object to "use before" dates, which are completely different, but to best before dates, the reason being that they cause people to throw out and replace perfectly good food, a significant problem which costs money. Not only do consumers throw out food that has past its best before date but supermarkets are also required to remove such products from their shelves. This means the farmer or local stockist is not paid because his product has not been sold. It is completely wrong that the farmer or first producer is forced to pay for this practice.

I compliment the IFA on winning the long-running battle about Brazilian beef. While I do not have a problem with beef from Brazil, I have a problem with Irish farmers trying to compete with it. Although I concur with the Minister on the importance of competitiveness, if Members will forgive the use of a cliché, we also need to have a level playing pitch. I do not propose to dwell on what is being done in Brazil in terms of beef because Irish farmers have made this clear. However, I listened to a documentary on BBC Radio 4 last weekend which highlighted how farming in Brazil is wrecking infrastructure and the Amazon forests. Nobody cares, even though carbon sinks are being developed which cost the world in terms of greenhouse gas emissions. Goods produced in Brazil are then exported to this side of the Atlantic where they put our farmers out of business.

I will be clear on this matter to avoid misunderstandings. I ploughed a lone furrow in the 1990s when I fought the Government and IFA because they were trying to con Irish farmers into believing they could secure a price for their beef in excess of the world price in the long term. It took seven or eight years for my argument to be accepted. It is, however, unfair to require European farmers to compete with Brazilian farmers who ride roughshod over the environmental demands imposed on farmers here.

This brings me to the issue of traceability. When I am buying chicken I want to know where it was reared. French supermarkets have adopted a simple approach by placing on all chicken products a label with the words "élevé a", as in "reared in" or "bred in", followed by a location. I want a similar system introduced here. Why does the Minister not simply decide to do so? When his officials tell him how difficult it would be to introduce such a system he should tell them they should sort out the difficulties by the following Monday. He must make this change to ensure that every piece of chicken sold in this country features a label indicating where the chicken was reared. I do not care where it was processed, had water pumped into it or had tandoori spices added to it. I want to know where it was reared.

On another issue, which I have raised previously to the great amusement of my colleagues and on which I feel strongly, we no longer do certain things in this country. For example, it is virtually impossible to find mutton nowadays. One must fight with a butcher to get mutton to make Irish stew. To describe a one year old lamb as mutton is a marketing ploy. If I walk into a house where mutton is being cooked, I will know from its distinctive smell that it is mutton. It tastes and smells different from lamb.

John Paul Phelan (Fine Gael)
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Could the Senator tell mutton dressed as lamb?

Joe O'Toole (Independent)
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I know mutton dressed as lamb and lamb dressed as mutton. I am lucky to be of a generation which learned the great art of telling them apart. I worry about young men who never had to make the distinction.

The Minister referred to competitiveness and diversification. I ask him to do me the favour of studying a highly technical area of diversification until he fully understands it. Why are farmers who wish to build wind generation facilities on their farms not being paid a decent price for placing spare electricity in the grid? Why is this electricity not counted towards carbon credits? This issue must be examined and farmers encouraged to engage in this area. I know of one if not two farmers who are Members of the other House and have wind turbines on their farms which generate 10 kw or more of electricity. They would be prepared to increase the electricity they generate.

We must examine the things we do not but could do. The Melton Mowbray pork pie is the great pork pie of the United Kingdom. At one stage, one could buy these pork pies in every Tesco store in the UK, which meant the tiny town of Melton Mowbray would have had to produce 1 million pork pies every day to meet demand. People in the town asked why the name of their town could be used on pies produced elsewhere. They took legal advice and discovered the principle of area of origin, under which certain products featuring the name of a place must come from the place in question. The concept tends to apply to wines but extends to many other products.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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It is known as the geographical indicator.

Joe O'Toole (Independent)
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When people in Melton Mowbray took on the major supermarket retailers in the United Kingdom, they were laughed at but they fought and won their case. As a result, the town owns the title of "Melton Mowbray" pork pie, which means that if Tesco or other retailers want to sell these pies, they must comply with the direction, regulation and arrangements made by the town. I would like the same to be done in the case of Dingle pies, Limerick ham and many other Irish products. There are, for example, many cheeses in Senator Prendergast's county - Cashel Blue is one - which are defined by their name.

For the people of Cashel, this means Cashel Blue cannot be made in Dingle. It is more than an Irish commodity; it is about developing the infrastructure of the area, something we are bad at.

I am not only interested in one-year old lambs. One-year old chickens, or capons, are sold all over the Continent and often numbered, just like a bottle of wine, according to area of origin. They are more expensive to buy, but we are not doing this. At the end of the day, it is all defined by those buying food. That is the objective of farming, at which we need to look carefully. However, we should not look at this issue solely on the basis of the CAP envelope we receive. It is about more than that because the envelope will only continue to be received if we get the other bits and pieces right.

The grass-based production system used in Ireland can deliver. It lifted my heart to drive through the countryside in the last month and see cattle on the grass again. People complain about the weather, but farmers in the south of France cannot let their cattle out in the summer because it is either too hot or they have something they want to grow. We have the production capacity which we need to protect. This is even more attractive for an island nation.

We should support the IFA which is well meaning. There is nothing wrong with being a self-interest group because we have to have people who will look after farmers' interests. The IFA has its own proposals to make on sustainable food production, maintaining young farmers in the industry, rural development and so on, all of which are of crucial importance to Irish society.

I compliment the Minister on the work that he and his officials are doing. It is difficult work and there is not great support for agricultural policy in many of the industrialised countries in Europe which must learn that they must eat, as well as make money. Their long-term prospects are best protected by supporting the Common Agricultural Policy that is in place for the benefit of everybody. Ireland can play a huge role in becoming part of the food basket of Europe. That should be our objective.

Francis O'Brien (Fianna Fail)
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I welcome the Minister. I am delighted to see him in good form and jovial mood, as he has been under a lot of pressure in the past few weeks.

I welcome the opportunity to debate this important issue in the House today. In the Treaty of Rome the main objectives for the Common Agricultural Policy were to increase agriculture production, ensure a fair standard of living for farmers and those in engaged in agriculture and to stabilise markets to ensure a supply of wholesome healthy food for EU consumers at reasonable prices.

Since 2003 the main farm support mechanism has been a decoupled payment in the form of the single farm payment scheme. Ireland was the first country to adopt this policy in its entirety and it is important that we remain committed to this approach. Decoupled payments remain the best way of underpinning medium and small family farms, while at the same time giving each individual the freedom to respond to market opportunities. In the past few years we have seen a steep fall in the price farmers receive for beef, cereals, dairy products and sheep. This has resulted in farmers relying solely on direct payments for family farm income. The latest national farm survey report shows beef, sheep and tillage farmers were actually using direct payments to cover some of their production costs. This has resulted in declining family farm incomes which declined faster than non-farm incomes in urban and rural areas.

The decline in farm incomes is not unique to Ireland. We have seen a decline in farm incomes in the past few years in most EU countries. This has resulted in lower production owing to reduced profitability in the main land-based farming sectors. The European Union is no longer self-sufficient in beef or sheepmeat production. This clearly shows that right across the Union farm subsidies under the CAP are essential as a guarantor of food security and income support in the maintenance of the family farm structure as a way to maintain rural communities.

As well as maintaining a support mechanism through direct payments, it is also important that there be market supports or other structures put in place to reduce the huge fluctuations in farm gate prices that have occurred in the past few years. Small to medium-sized family farms cannot survive large farm produce price changes from year to year. It is important, therefore, that mechanisms are put in place that can be acted upon speedily to lessen the impact of sudden price drops, as happened in the case of milk in 2008 and 2009. The existing market support tools need to be maintained or developed further with a view to controlling sudden market price changes.

Since 2003 direct payments have been calculated on an historic basis, decoupled from current production methods or scale of production. From 2013, a new basis for calculating direct payment entitlements will be needed. In this regard, different options need to be analysed. However, any new system needs to be fair and must enable farming to remain competitive and sustainable. The movement to a flat rate payment system would not meet the aim of ensuring a fair standard of living for active farmers. A recent study carried out by Teagasc shows that a flat rate payment, while moving income from the south east and the midlands to the west and Border regions, would also move payments from those farms contributing most to agricultural output and could, therefore, endanger the future of family farming as a means of earning a family livelihood. A fairer system might be based on calculating rates based on income from farming on a regional basis and rewarding farms in active production, protecting the environment or adding to the well-being of the wider rural community. The current supports to improve competitiveness in agriculture through grant aiding target investments and agri-environmental schemes need to be maintained in the CAP programme post-2013. REPS and schemes like the farm waste management scheme have brought major improvements in the environment and standards of animal welfare on Irish farms. The continuation of schemes such as these would bring extra capital and employment into rural areas that are now unemployment blackspots owing to the economic downturn. As a nation we should support and insist on the main plank of rural development policy to be supporting farmers to develop their farms to full productive capacity and at the same time protecting the environment for the well-being of society in general. Measures such as these are critical not alone for Irish rural communities but for the wider EU farming communities.

Direct payments and rural development programmes are essential for the well-being of rural communities throughout the EU. For this reason alone these programmes should be agreed and funded as a common policy for the entire EU. The proposal to have co-financing of direct payments by national governments would discriminate against communities in poorer countries and would end the only real common policy currently in the EU.

The upcoming review of the CAP will be important not alone for Irish farming and rural communities but also for future EU agriculture policy. We need to develop a strong policy where as a nation we can go forward into negotiations with a clear agenda for the well-being of this industry which is so important for this country. I am confident our negotiating team under the Minister for Agriculture, Fisheries and Food, Deputy Smith, can deliver a new CAP post-2013 that will benefit the farming community and rural areas.

Phil Prendergast (Labour)
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I welcome the Minister of State to the House and congratulate him on his recent appointment. I am delighted to take part in this debate. The future of the Common Agricultural Policy needs to be addressed now. We are fast approaching 2013 and, with every day that passes, the situation for Irish farmers becomes more critical. Agriculture remains at the core of Irish rural life and CAP 2013 is vital to securing the viability of farming as an option for young men and women. We must encourage young people to get involved. CAP reform must protect small producers who form the backbone of rural areas and it must ensure they are not neglected in preference to larger operations.

The single farm payment is key to the livelihoods of most small farmers. The Government must act in a decisive manner to protect the single farm payment from the threat posed by the future negotiations of CAP. The CAP process is not intangible; it is about real people, families and communities. I am from a rural constituency. Not only is it rural, 53% of the electorate come from those rural parts. I am glad this debate is taking place in the House. It is time for an informed debate to begin because we cannot wait until 2013. Now is the time for action. Now is the time to decide what we want from the CAP and for the future of the agriculture industry.

My colleague, Alan Kelly, MEP, recently carried out a survey of farmers. The findings show that 97% of farmers believe that CAP is of major importance or is vital to Irish agriculture but more than 90% of them believe that the future of CAP will have a negative impact, which was a somewhat surprising finding. Mr. Kelly, MEP, revealed these results at the Future of CAP - Crisis or Opportunity for Rural Ireland conference which took place at the end of March. This conference was the first of its kind in Ireland and it saw attendees from throughout Ireland gather to hear speakers, including Deputy Gilmore and the IFA president, John Bryan, discuss the future of CAP for Irish farmers. There was great interest in that kind of debate. It was an additional forum at which people could put their views. As people involved in seeing where laws originate and how we might access funds, it is very important to keep in touch with the people we represent and not to forget that we are supposed to be the spokespersons for them and the buffer between them and what can help them.

CAP is worth in excess of €1 billion to the Irish economy in purely financial terms. Unfortunately, because it is an agricultural issue and one for rural areas, it does not get the attention it deserves. I do not say that lightly. I also do not wish to be unfair in stating that. However, there is nothing sexy about it. We need to present a united front in Europe to protect our national interests and ensure a future for Irish agriculture. We need a strong vision for the future of CAP. We cannot have a CAP that provides almost random subsidies to large farmers and companies. We need a CAP that will protect and foster the family farm structure. Of course we have many examples of that in south Tipperary. We always like to be parochial in mentioning what is good in our constituencies. We have already identified that Tipperary is fairly good on cheeses. We also have the apple farms and good farmers' markets, of which the Green Party have been very supportive.

Phil Prendergast (Labour)
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One always has an eye on the future. We have good produce and good butchers such as Pat Whelan. The Minister of State would be welcome to come and sample it at any time.

Ciarán Cuffe (Dún Laoghaire, Green Party)
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I look forward to it.

Phil Prendergast (Labour)
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If we believe in the future of Irish agriculture, we need to structure CAP in such a way that it will foster and encourage innovation, sustainability and quality. Deputy Sherlock, the Labour Party spokesperson on agriculture, has been calling for this approach for some time. That should not present any difficulty in terms of the Minister of State's philosophy. It is something on which a common response could be agreed. The response from Government so far has been a deafening silence. I welcome this opportunity to put the case to the Minister of State and I acknowledge that he is listening. I also noted that the Minister, Deputy Smith, who was in the House earlier, was taking notes during the debate. This is not like the usual forum where we say something that has no meaning or does not resonate with the Minister who is listening. I would like to think there is relevance to the debate. It certainly has an additional meaning when we can give positive examples and the Minister of State knows that what he is hearing is fact and not just rhetoric.

The devil is in the detail and the CAP is no different in that respect. It is obvious there are real concerns in the farming community that CAP will lead to a significant reduction in income within the agriculture sector. The fact that more than 900 farming families have been awarded a payment under the farm assist scheme since the start of the year is further proof that many families in rural areas are on the breadline. This is a worrying trend and reinforces the need to ensure any decisions regarding CAP will not further negate farm incomes.

We often make the mistake of thinking that the interests of those in rural areas are different from the interests of those who live in urban areas. Nothing could be further from the truth. We are one Ireland and all our interests are intertwined. Deputy Gilmore has said:

Real vibrant communities will not survive and thrive without some support. As the CAP moves more and more away from direct support for farmers, it can have a new role in protecting and enhancing rural life.

Small rural businesses, cottage industries and green energy can all be supported through a restructured CAP. We cannot hope to develop sustainable communities throughout rural areas unless farming is in a healthy and sustainable condition. I welcome this timely debate. It is time for the Government to engage with all stakeholders to ensure a fair reform of CAP to the benefit of all.

Niall Ó Brolcháin (Green Party)
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It is my pleasure to welcome the Minister of State, Deputy Cuffe, to the Seanad and to see him here, covering his brief of horticulture and agriculture, key issues for the Green Party. I thank Senator Prendergast for mentioning the farmers' market aspect.

So far, the debate has been good. Senator Bradford said this was a green jersey issue. That resonates with me, not because of the word "green" but because it is an Irish issue and we must all get behind it. I join others in giving support to the ministerial team which negotiated on behalf of Ireland on the CAP agreement.

The Common Agricultural Policy and food security are very much intertwined and food security is very dear to the hearts of those in the Green Party. Our policy states that food security can never be left to the vagaries of the market, a very important point. I grew up in a rural farming area, a sugar company baby, as one might say. My father worked for the Irish Sugar Company and I grew up in an area that was surrounded by Teagasc, or, as it was known then, the Agricultural Institute, on one side and Erin Foods on another. The Irish Sugar Company was very much part of this landscape. It is very sad for me to see the loss of production of sugar in this country which was introduced during the Lemass era.

Agriculture has always been an enormous part of what we are in this country. It is a much greater proportion of our economy than it is in Britain, for example. I understand that British agriculture forms roughly 1% to 2% of that country's economy, which it could quite easily do without, because financial matters were considered to be much more important than agriculture. The reality is we all eat food and none of us eat money. Agriculture is very important to the security of any country. Ireland is lucky in that we can sustain the population we have, something the new Prime Minister of Britain cannot say because Britain cannot sustain its population with the agriculture it has.

In Ireland, aspects such as horticulture are not valued in the same way as beef cattle farming or the dairy sector. We specialise and that is important. However, food security is crucial for our future and our survival. Again, the Green Party states:

The Green Party will try to lobby for changes in the World Trade Organisation to protect domestic food production from competition from cheaper imports. The Greens believe that every country in the world, particularly a Third World country, must be allowed to take adequate protection measures in order to ensure its own sustainable self-sufficiency in food, thus establishing an equilibrium in the balance of goods produced for home and export.

At present, the World Trade Organisation refuses to let countries distinguish - in their rules on imports or on what can legally be sold in their territory - between products on the basis of the way in which they are produced, if that distinction applies to imported as well as to domestic products. The World Trade Organisation must be reformed to allow countries to ban imported goods that have been produced under substandard animal welfare conditions or by using banned agri-chemicals.

The point of the policy is that it is crucial that the standards we apply in this country also should be applied to the food imported into this country. I spoke once on the madness of flying in broccoli. Importing huge amounts of vegetables such as broccoli into this country by flying them in from South America is simply not sustainable.

We can look at what is happening at present in regard to the Icelandic volcano. I am obsessed by it because it will have a great impact-----

Rónán Mullen (Independent)
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Can the Senator pronounce it?

Niall Ó Brolcháin (Green Party)
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I cannot.

Rónán Mullen (Independent)
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Neither can I.

Niall Ó Brolcháin (Green Party)
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I am not even going to try.

Pat Moylan (Fianna Fail)
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No interruptions.

Niall Ó Brolcháin (Green Party)
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It is having an enormous impact on this country. In some ways it may-----

Ciarán Cuffe (Dún Laoghaire, Green Party)
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Eyjafjallajökull.

Niall Ó Brolcháin (Green Party)
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We shall allow the Minister of State to pronounce the volcano later.

Paul Bradford (Fine Gael)
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The learned Minister of State.

Niall Ó Brolcháin (Green Party)
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Indeed. His Icelandic is far better than mine and I defer to him on that. It is interesting because it highlights the fact that we bring in so many food products by flying them in from other countries. If we can produce these products locally, should we fly them in, burning up carbon in so doing? The importing of people is an entirely different matter but should we fly in products from South America that we can produce locally? I say "No".

Senator McCarthy referred to Baileys Irish Cream. In my working life I had the great privilege of working for Virginia Milk Products which produces Baileys Irish Cream for the market. The cream used was absolutely fantastic. Having the cream from Baileys Irish Cream with a dessert was an unbelievable experience because the quality of that cream was so great. It was one of the nicest things I have ever eaten in my life. It really feels so light compared with the standard stodgy cream which one can buy elsewhere. I will not say where.

Rónán Mullen (Independent)
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We are moving into Miriam Lord territory.

Pat Moylan (Fianna Fail)
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No interruptions, please.

Niall Ó Brolcháin (Green Party)
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I make a serious point concerning the quality of Irish food. We must focus on that quality in this country because while we cannot compete with the huge monocultures of very large countries elsewhere, such as Brazil, we can compete in the high quality of locally produced food.

I refer again to what Senator Prendergast said. The Green Party is taking a very proactive approach in encouraging organic food, farmers' markets and locally produced food. These should be linked to local restaurants and schools. I stress the latter because it is very important we educate people about food production. Sheep farming in Connemara was brought to my attention, for example. We want to encourage Connemara lamb as a product. I mentioned before that some of the carpets in this House were manufactured in Connemara although they cannot be made there now. Increasingly, sheep farmers have an older profile and are in their 50s. Young farmers are not going into this type of farming.

We need a very strong educational programme in schools. When he was Minister of State, Deputy Sargent, who preceded the present Minister of State, Deputy Cuffe - I am mixing up my Deputies and Ministers - put in place a very strong programme of growing food in schools. He also made significant progress in putting farmers' markets in place. Allotments make up another very important campaign. Increasingly, people are moving to the cities and Ireland has become more urbanised. As a result, many people simply do not know how to plant a seed and watch it grow. It is very important, therefore, that young people are educated from an early age in how a simple thing such as growing a sunflower or any other type of food actually works.

The Green Party very much wants to promote organic food and has a target for us to reach 5% organic production in the not too distant future. It is very important we produce high quality organic food and that is the policy of the Government. I would like to see much more money being put into organic food production. In the past, subsidies were put into non-organic or genetically modified food, but we must value and prioritise organic and sustainable food.

The IFA is highlighting grass-based food production which is the right way ahead. As one who worked in the dairy industry, I saw non-grass based milk production, for example, in the United Kingdom. Our production of cheese and milk products is something we can see and export to the highest possible standards. We do not take enough cognisance of this and do not value it as much as we should. I propose high quality organic food production.

Senator Joe O'Toole mentioned windmills and we should look to supplementing farm incomes with non-farm activities. It is very important that we look to underpin rural people so they can make incomes not just from food production or farming, which is increasingly difficult. We should encourage community energy production in a big way as there is not enough of it. We might only be talking about rainwater collection systems or windmills, which would produce wind for specific farms.

Anaerobic digestion and bio-gas production can also be increased in the country. Currently there is zero production of bio-gas but in countries like Germany, a significant level of renewable energy is produced through bio-gas. The Cathaoirleach is nodding so I will end on time.

Pat Moylan (Fianna Fail)
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Senator John Paul Phelan will have ten minutes to speak but I ask him to move the suspension of the House until 2.30 p.m.

John Paul Phelan (Fine Gael)
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Having sat all morning through the debate, I am gutted.

Rónán Mullen (Independent)
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The rest of us are gutted as well. There will be time for the people of Kilkenny to get to their representative.

Pat Moylan (Fianna Fail)
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I neglected to welcome the Minister of State, Deputy Cuffe. I wish him well.

Pat Moylan (Fianna Fail)
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I welcome the Minister of State, Deputy Finneran.

John Paul Phelan (Fine Gael)
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I also welcome the Minister of State. I am glad to have an opportunity to contribute to this debate on the upcoming reform proposals of the Common Agricultural Policy and the vital role CAP has played in rural Ireland since we joined the EU, a role which it will continue to play.

It has always been my firm belief that the best form of rural development is trying to keep as many people actively involved in agriculture in rural areas as possible. This should be and probably is the Government's starting point in the upcoming review of CAP. As the Minister for Agriculture, Fisheries and Food stated, the Government will be under significant pressure to change the way the national envelope is distributed to rural communities, namely, less emphasis on direct payments and more emphasis on rural development issues. However, direct payments to farmers are of most benefit to rural Ireland. Money given to farmers in this way is spent in the rural economy on services that provide real and sustainable jobs in those communities.

A number of the preceding contributions were interesting. I do not have a great deal of new information to add to the debate, but I was taken by the Minister's reference to the fact that he was considering events in the United States of America with regard to market supports. It was a suggestion I was going to make to him. A farm Bill enacted in the US not that long ago comprised a range of new market support measures. Most Senators who have contributed to our debate mentioned the detrimental effect of price volatility on the people involved in farming. Many cannot sustain long periods of below-cost production. The Americans have undertaken a number of initiatives aimed at ironing out volatilities in the prices farmers get for their products. Before the review is formalised, I urge the Minister of State and the Department in their negotiations to consider events in the US in a bid to determine whether CAP could adopt some of those measures.

It is worth pointing out that CAP and agriculture in general comprise the only aspect of the European economy that is fully integrated across the Union. Many of the actions taken by the Government in the agricultural sector are dictated by agreements at European level. I agree with Senator Bradford and others who stated that the overall aims and objectives that CAP was set up to achieve have been achieved. We have a secure supply of food for the European market. After the Second World War, there were significant food shortages, but that is no longer a difficulty. In the overall GDP figures within the EU, the amount being spent on CAP is a small price to pay for ensuring a safe and reliable food supply.

I emphasise the points made by a number of Senators regarding the nature of agriculture in Ireland, namely, how our industry is largely grassland-based, and its significant environmental benefits over some other more intensive forms of agriculture. There should be a pay-off for farmers in light of their activities in land management and looking after the countryside, the benefits of which have accrued over a long period.

At a time when everyone has a heightened awareness of the climate and climate change, the significant problems stemming from deforestation, particularly in South America, are worth pointing out. The EU has an open system, in that product is accepted from many third country markets. As well as being of spurious quality in some cases, this product has led to considerable environmental damage in some of those third countries. Ireland already has in place the landscape to produce top quality food without impacting the environment as adversely.

It is vital that whatever comes from the CAP review should ensure farm families are not forced to produce at below the cost of production indefinitely. The Minister referred to this matter and I agree fully. We must provide a sustainable future for young people in agriculture. The current CAP regime and direct payments system pose a difficulty in that they comprise a historical system, making it more difficult for young people who want to get into agriculture to gain access to some of the entitlements still being paid to some people who have ceased production. This matter will have to be addressed. Expecting the European Union to continue to pay in full, based on an historical system with a reference period that stretches back almost ten years, is an approach which cannot be sustained. By the time the review is complete, the reference period will stretch back further than ten years.

Another substantial issue that has arisen during my time in politics is that of the standards relating to products. While I disagreed with some of the comments made by Senator O'Toole, I agree with what he said on the implementation of the different standards, directives and regulations across the European Union. He stated the standards which applied in France and countries in continental Europe in respect of markets, produce and the butchering of animals were very different from those which applied here. It is the fault of the Department of Agriculture, Fisheries and Food and the Government that we have continually used the strictest forms of wording when implementing European regulations, particularly, as Senator O'Toole stated, in respect of butchering and abattoirs.

In every parish throughout the country one or two people would have been responsible for slaughtering lambs or cattle. People brought their animals to these individuals who operated to a very high standard to have them butchered. A service was provided and the moneys generated remained within local economies. On foot of the legislation dealing with abattoirs that has been put in place, the practice to which I refer has been almost completely wiped out. In County Kilkenny there are now only two or three abattoirs involved in the slaughter of animals. That is shocking, particularly when one considers that in any village in France one will find a butcher who is involved in the slaughter of animals. One will also find all types of other local industries that provide services for and create employment in their communities. The French have managed to retain this aspect of rural heritage which has been lost in this country. The Government should reconsider the way we implement EU rules and regulations, particularly in the context of the butchering of animals.

There has been much criticism to the effect that the Common Agricultural Policy does significant harm to agricultural production in Third World and developing countries, but nothing could be further from the truth. The European Union is the biggest importer of food from such countries and allows free access to all of its markets for the 20 least developed nations in the world. Our friends in the United States and other countries should be encouraged to adopt such a model.

The Common Agricultural Policy was described in one of the briefing documents we received in advance of this debate as a social contract between farmers and society. That is certainly true. I grew up in a rural environment. I am not a farmer or directly involved in agriculture but both of my brothers are farmers. It must be central to our policy on this matter that we encourage as many people as possible to be viably employed in agriculture.

The figures relating to agriculture are stark. In real terms, farm incomes have fallen by 50% since 1995. No other sector of the economy has experienced such a drop. Rural areas have been devastated as a result of the collapse of the construction industry. Many young people from farming backgrounds who left education early and went to work on building sites are now out of work. Given that the Government has suspended installation aid and the early retirement scheme, it is becoming very difficult for those to whom I refer to become involved in agriculture. There is a need for significant reforms to be introduced. However, we must support the overall allocation for Ireland in the context of funding from the European Union for agriculture.

Paschal Mooney (Fianna Fail)
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I welcome the Minister of State, Deputy Finneran. It is appropriate that he should be here in succession to his senior ministerial colleague, Deputy Smith. I compliment them on ensuring the interests of rural communities are continually kept high on the agenda. In a sense, that is the essence of this entire debate. Reform of the Common Agricultural Policy means many things to different people. I agree with previous speakers who stated that, from an Irish perspective, the main aspect of CAP reform related to the protection of rural communities in order that they might survive and meet the challenges that lay ahead.

The CAP accounts for approximately 50% of the European Union's budget and covers a wide range of expenditure areas which are divided between pillars l and ll. Since the CAP reforms of the mid-1990s which were initiated by the then Commissioner, Mr. Ray MacSharry - another man who came from a rural background - there has been a shift towards direct support in the form of premium payments. The current single farm payment comes under pillar l and replaces the individual payment schemes.

The discussions under way will lead up to 2013. Ireland's vital national interests will be debated during that period. Whatever shape it takes, the reform of the CAP will mean the country will be obliged to adopt a bottom-line approach because said reform cannot be seen to endanger in any way farm incomes or rural communities.

In the interests of obtaining an indication of the importance of payments under the CAP, I sought some statistics in respect of those in receipt of them. Ireland and Greece are among the major recipients of CAP funds. This is despite the fact that in 2006 agriculture accounted for just 3.1% of GDP in Greece and 0.9% in Ireland. There is a view that much of the CAP money goes to the biggest farmers, namely, large agribusinesses and hereditary landowners. It has been calculated that 74% of the funds goes to just 20% of EU farmers, while at the other end of the scale, 70% of farmers share just 8% of the funds. The Commission states this is heavily influenced by the funding for farms in the new member states. From the perspective of the national interest, this aspect is going to present a challenge for the Minister for Agriculture, Fisheries and Food in the negotiations that are due to take place.

The most recent reform of the CAP occurred when agreement was reached in November 2008 on the introduction of the health check, which incorporated a scheduled review and adjustment of the mechanisms of the CAP which were intended to improve, reinforce and build on previous CAP reforms and include further decoupling of direct farm payments from production in sectors such as arable crops and the phasing out of milk quotas by 2015. The health check also proposed reducing red tape for farmers through simplification of direct farm payments and the requirements of cross-compliance.

The issue of regulation continually arises when discussions with regard to the European Union take place. Members who have had dealings with those who have been obliged to complete the reams of paperwork and traverse various hurdles in order to obtain a small amount of money will be familiar with over-regulation. There is a view abroad that Ireland is a good member of the Union because it seems to adopt the various directives and regulations before many other countries. Perhaps it might be more accurate to state that as well as adopting them, we go the extra mile in implementing them.

For many years successive Governments fought against implementing a particular European directive. However, in January the Minister for the Environment, Heritage and Local Government signed an order in respect of the dispersal of surface water in one-off housing. In that context, some 98% of land in County Leitrim is marginal in nature. In other words, very little grows on it. The county is also unique in that under the initial layer of topsoil there is what is termed in common parlance as "Leitrim daub", a substance otherwise known as mud, and its presence means there is very little downward percolation. As a result of the introduction in January of the order to which I refer, the refusal rate of the planning department of Leitrim County Council in respect of one-off rural housing has risen to between 80% and 85%. In a county that is more rural than urban the continued implementation along current lines of this code of conduct, the guidelines for which were drawn up by the EPA and now are being implemented by local authorities across the country, could sound the death knell for rural communities. The issue is wrapped up in this debate on the CAP and I wished to mention it in passing.

People in Ireland take a cross-party approach to this issue and references have been made to wearing the green jersey by all Members of the European Parliament, successive Ministers for Agriculture, Fisheries and Food and the Opposition spokespersons on agriculture. Whenever interests vital to the country's economy arise, there is no dissent and a unified approach is taken, particularly in respect of anything that tinkerers or tampers with the Common Agricultural Policy. However, from a cursory glance at the websites that have been set up to explain and discuss the CAP reforms one will find that there is a growing and highly significant lobby that is gathering a head of steam to challenge the continuation of direct farm payments and persuade the powers that be in the European Union and individual member states to stop or redirect them. One aspect of this trend is that the Lisbon treaty gives increased powers to the European Parliament in the area of co-decision, specifically in the area of agriculture. Heretofore, the powerful Committee on Agriculture and Rural Development of the European Parliament was able to deflect much of the criticism and efforts made to undermine the CAP during the years. However, on foot of these changes, the European Parliament will have a greatly enhanced role. My concern is that a successful assault on the CAP up to 2013, given our relatively small numerical representation in the European Parliament, coupled with the shift eastwards to the member states that joined the European Union in 2004, could have a detrimental and adverse effect on the payments coming directly into rural communities in Ireland.

Moreover, one does not need to go as far as mainland Europe to find opponents of the CAP. The Department for Environment, Food and Rural Affairs in the United Kingdom makes the point with regard to the health check:

We were ... disappointed that the Health Check was unable to go further in reforming the CAP, and we are concerned about the market distortions created by the increased flexibility in the use of 'national envelopes' which allow Member States to reintroduce production-coupled payments to support specific farming sectors.

This provides an indication of where the United Kingdom stands on the CAP. The Department goes on to state:

In line with our Vision, the Common Agricultural Policy needs far-reaching reform, including the phasing out of spending on Pillar 1, with payments under a reshaped Pillar 2 of the CAP focusing on delivering environmental benefits that the market wouldn't otherwise deliver.

Pillar 1 includes direct income support, rewarding farmers' historic support entitlements, single farm payments and single area payments, while Pillar 2 pertains to the policy's environmental aspects. In this regard, I note the Government has gone a long way towards ensuring the payment of a minimum income to farm families who, in return, will improve the environment in which they operate.

I refer to comments made by the new Romanian Commissioner for Agriculture and Rural Development, Dacian Ciolos, in a recent exchange between the Committee on Agriculture and Rural Development and his cabinet. While on the face of it, he appears to be supporting much of what Members have been advocating in respect of the preservation of rural communities and the enhancement of the environment, I detected in the subtext that he was not as engaged in such support as were some of his predecessors such as former Commissioners Fischler and MacSharry.

A great challenge lies ahead for Ireland. There is momentum sweeping across Europe on the consumer side, aided by significant governments such as that of the United Kingdom, to dismantle the CAP that would have a detrimental effect on Irish farm families. I compliment the IFA on continuing to highlight the issue and wish its new president, Mr. John Bryant, every success. He has a loose connection with my home town of Drumshanbo in that his late uncle, Mr. Dick Bryant, was a bank official there. I have found that Mr. Bryant has the interests of small farmers in Ireland as much at heart as those of the larger farmers in the IFA.

Feargal Quinn (Independent)
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I welcome the Minister of State. I have spoken on the Common Agricultural Policy during the years. Approximately ten years ago Herr Fischler appeared before the Joint Committee on Agriculture, Fisheries and Food. I criticised him for speaking for 20 minutes about food and agriculture without once mentioning the consumer. I have a small hang-up on the issue, that, to a large extent, Members are biased in this regard by being greatly influenced by the interests of farmers, rather than necessarily thinking of consumers. I will try to be more balanced this time.

I served on the expert food group which was established in 1993 to ascertain how we could best handle food production and which eventually led to the establishment of Bord Bia. It was then that I learned of Ireland's great ability to produce food and the huge opportunities that arose therefrom, albeit without guaranteeing it was all based on Irish produce as such. There are two different businesses, namely, the food business and the agriculture business. One of the reasons for my minority report on that issue was that there was a need to emphasise that Bord Bia, or whatever it was going to be called at that stage, ought to be established anywhere but under the aegis of the then Department of Agriculture and Food because the food business and the agriculture business were different.

The CAP is different and of tremendous importance to a country such as Ireland which hasd gained worldwide recognition in and a reputation for the production of outstanding agricultural products. Such produce comprises Ireland's largest indigenous industry which affects us all. One need only consider the facts. A report in The Irish Times states, "Whereas official figures show the Irish agricultural sector made a surplus in excess of €1.6 billion last year, the [result] is that farming would have incurred a €200 million ... loss without the contribution of the EU". According to the Department of Agriculture, Fisheries and Food, nearly €2 billion was paid to Irish farmers and businesses under the CAP in 2009. Moreover, the level of aid under the CAP has maintained production in all rural areas of the European Union, with approximately 27 million people depending on agriculture for much required employment. It is worth remembering that farmers comprise less than 5% of the European population but use approximately 80% of the land of its territory. As other Members and the Minister noted, the CAP is of vital importance in securing the environment, including water, soil and air quality, for future generations.

I turn to the subject of food production. I have noted previously that the agrifood sector in Ireland is a massive growth area, given our inherent strengths. I was glad to see a new report entitled, Pathways for Growth, prepared for Bord Bia by Professor David Bell and Ms Mary Shelman of the Harvard Business School. It states Ireland should adopt a strategy of developing a world-class agriculture industry by 2016 and set itself the goal of becoming the most efficient, most highly innovative food and drink country in the world. The analysis concludes that the agrifood industry is failing to take advantage of its natural resource base and international reputation as a trusted supplier of high quality food products, in spite of the great work being done by Bord Bia. The key inhibitors identified are the fragmentation of both production and processing and the lack of a consumer focus. The report also identifies a clear lack of leadership. It states, "No one has stepped forward to articulate and champion a vision of Ireland as a player to be reckoned with in the world food market". While I have great admiration for the work being done by Bord Bia, this is a reminder that it is not enough simply to produce food. If one wishes to make it a success, it must be valued.

On the issues of food security and the supply chain, the CAP is vital in attempting to give Europe much greater food security. Members should consider the situation in Africa where the Chinese are buying up millions of hectares of land simply to grow food. I was not aware of this until I carried out some investigations.

In the coming decades we will face changing and accelerated demand worldwide caused by growing populations. The population of the world is now 6 billion and it is expected to increase to 9 billion by 2050. Demand will also be influenced by changing diets in emerging countries, the massive uptake in the consumption of milk and dairy products in China being just one such example. Another factor is the risks caused by climate change, particularly in other parts of the world. The position of farmers within the food chain must be examined given the immense buying power of only a few retailers, a business about which I know something.

Commissioner Ciolos indicated that he wants to move towards more local production and quality produce. His big idea is to ensure that CAP mechanisms help small farmers to sell directly to local shoppers, thus bypassing the big supermarket chains. He also wants more precise labelling to encourage consumers to buy local produce and move away from imports. It is interesting to note this development. I have some involvement in Europe on this basis and this change is happening not only in Ireland but elsewhere. It is a welcome development but the recent eruption of the volcano in Iceland shows the vulnerability of the supply chain. Supermarket stocks of certain fruits and vegetables became disrupted within only a few days of the eruption of the volcano. This disruption in supply is affecting a great deal of businesses. Retailers in Ireland buy a substantial amount of vegetables from Africa that it is not possible to produce here.

I remember in one of our supermarkets being criticized by Deputy Rabbitte of the Labour Party for selling South African oranges during the Apartheid era more than 20 years ago. I told him we did not have a choice at that time of the year as we had to import such produce from the southern hemisphere but I told him we gave our customers a choice and that we were selling oranges from Chile. This was during Pinochet's rule and the Deputy said he would not touch those either. He would not buy produce from Africa nor from Chile. This is a reminder that the choices people have are consumer driven and that is the area to which I am referring.

I wish to deal with the issue of genetically modified crops. This issue of genetically modified foods is very much related to the CAP. The fact is that the world must produce more food. According to the UN, an increase of 70% in food production is needed by 2050 by which time it is forecast the world population will have increased to 9 billion. Food production is one of Ireland's strength and such increased demand presents an opportunity for us to develop this sector. We should be able to debate the issue of genetically modified crops and discuss whether crop productivity can be improved with science. I am not sure who is right regarding this issue but I am sure that we should debate it. We should not ban such a debate and I do not believe we are willing to do that.

Three reports published last month documented the benefits of genetically modified crops throughout the world. A review of peer-reviewed surveys of farmers worldwide who use the technology compared to farmers who continue to plant conventional crops, published last week in Nature Biotechnology, found that by and large farmers have benefited. Another report released last week by the National Research Council in the United States concluded that many American farmers have achieved more cost-effective weed control and reduced losses from insect pests. A survey of farmers in Brazil, which is a leader in the global adoption of genetically modified crops, shows benefits for soybean, cotton and corn growers. The Guardian, a British newspaper, reported that last year 14 million farmers in 25 countries grew genetically modified crops commercially, with more than 90% of them being small farmers in developing countries. The benefits were found to be greatest for small farmers in developing countries. The average yield improvements for developing countries range from 16% for insect-resistant corn to 30% for insect-resistant cotton, with an 85% yield increase observed in a single study on herbicide-tolerant corn. I mention this because we have excluded ourselves from such production. Genetically modified crops were also found to help agriculture play a crucial role in preserving the natural environment. This is an important aspect because people think that genetically modified crops will not help the natural environment but they do by reducing the number of insecticide applications on insect-resistant crops and facilitating reduced tillage on herbicide-tolerant crops. In March, the European Commission permitted the cultivation of genetically modified crops of a certain potato which was not allowed previously. Will we debate the issue or take an anti-science stance, which poses the danger that our agricultural industry could be left behind? I mention this issue because it seems clear an opportunity exists to develop this area. Máire Geoghegan-Quinn is the Commissioner for technology, science and innovation and I am confident she will say that such production makes sense. To do otherwise would be like saying we should not have had cross-fertilisation 200, 300, 500 or thousands of years ago when we started such production and that we must leave everything as it was in the past.

I also wish to deal with the potential of hills in terms of food production. It is worth noting there have been several calls in Scotland for better use to be made of hills in terms of producing food. Mr. Tony Waterhouse of the Scottish Agricultural College said he wanted to see a revival of the hill livestock industry as this sector could revitalise the rural economy on the hills. The National Farmers Union Scotland vice-chairman, Mr. Nigel Miller, put forward a similar message. He said:

There is an extraordinary amount of hill land available. A lot of it is not being used and, although it would be a big challenge, it could open up the way for new extensive farming systems to develop. Landlords could be encouraged by tax incentives to let land through limited-duration tenancies. We have to look at these options, otherwise hill farming will die.

Ireland does not have as hilly a terrain as Scotland. Nonetheless, perhaps we should exploit its potential much more in terms of tourism. One need only think of the market for hiking and hill walking in countries such as Germany and Switzerland. The CAP is much wider than we have generally thought in he past. We must make sure we cover all the area under its scope. There is an opportunity to develop our food production under the CAP. We are going in the right direction but we have a lot further to go.

Ned O'Sullivan (Fianna Fail)
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I wish the Minister of State, Deputy Cuffe, who was in the Chamber earlier, well in his food and horticulture portfolio, as the spokesperson on this side of the House for this area. I note his announcement last week of a renewed grant of €3.8 million for the horticulture sector. He is following in the direction of the good work of his predecessor, the former Minister of State, Deputy Sargent. I welcome our colleague and friend the Minister of State, Deputy Finneran.

I listened to most of the debate on the monitor and it has been interesting and wide-ranging with many useful and constructive comments having been made by Members on all sides of the House. I welcome in particular the positive support of the main Opposition parties for the Minister of State and the Government on what they have called a green jersey issue, which it is. It is an important issue for the nation that the CAP post 2013 will be as user friendly and as pro-Ireland as was the last one. That will only be achieved with a hard fight and, therefore, a united front is most important and greatly appreciated.

I acknowledge the good work of Bord Bia and the other agri agencies in promoting the image of Irish food abroad. As has been said on several occasions, we are an outstanding producer of a first-rate product and are entitled to and fully deserving of all the supports we have received from the EU over the years.

The debate took a scenic route for a while. I listened to the contribution of my colleague, Senator O'Toole, who raised the interesting issue of whether we in Ireland too slavishly follow the EU regulation to the letter of the law in terms of how we present our food. He instanced how the French display fruit and vegetables of various sizes, while we want them all to be uniform in size. Some of the joy in food production is lost when there is too much regulation. In that respect, the continued development of the farm market and country market sector must be supported and applauded. It is a growth area, whether it be a weekly farm market in a small provincial town such as one from which I come or the regular markets in Temple Bar and other parts of this city. They are wonderful and they sell Irish products in the main. They provide fresh produce for housewives. I wish the same could be said for fish produce. We have an abundance of fish but fish produce does not seem to percolate on to the tables of householders. The suppliers always seem to have run out of fish. At least, that is the complaint I hear from my wife, although perhaps she does not get up early enough in the morning. That is an area that could also be examined.

Senator O'Toole also referred to Brazilian beef. Members will be aware that talks on a Brazilian beef quota are currently taking place. I have never been anti any country. I have nothing against Brazilian beef or the Brazilians so long as they play on the same level pitch as us. Irish farmers adhere rigorously to regulation in respect of hormones and so on. One would have to be totally satisfied the same standards were being met in South America before agreeing to allow entry to that competitive element. If they do not meet the same standards expected of Irish farmers, they should not be allowed in. I am sure the Department will be vigilant in this regard.

Reference was made earlier to our anomalous situation in terms of our grant aiding and supporting inactivity. We are in many instances paying people not to produce, which is a matter of concern given half the population of the world is starving. I am sure this will be an issue that will inform the debate on CAP and which we might have to fight hard to counteract. I do not believe the Minister's job is easy.

Since its inception, CAP has guaranteed Europe's essential food supply. Ireland, as a leading supplier of high quality food, has most to gain from EU support for the agri-sector. We are the supplier and we must be supported. Our entire farming activity is predicated on continual support from Europe. While change is not unwelcome, it must take cognisance of the fact that Ireland is a supplier to the bread basket of Europe and the world. It was recently leaked from a draft European document that Europe is stiffening up for serious change in regard to the administration of CAP and how grants will be computed in future. The Minister is rightly alert to this and has already consulted widely in this regard with people in the farming sector. I am aware also that the new consultative committee on CAP will meet next week for the first time. The Minister has been proactive, on which I commend him.

The expression "green jersey" was mentioned earlier by Senator Bradford. We will have to get behind the Minister and work as a team on this. I know that the farming organisations, the IFA and ICMSA are anxious for the Minister to succeed. It is important we speak with one voice and that there is no fragmentation in this regard. There is nothing worse than reading of the difficulties being experienced in the small hours of the morning by the Irish negotiating teams in Brussels. This is too important for that. The Minister is leading the national effort and it is important he receives our full support.

The new member states want a new deal and for grants to be readjusted in their favour. There is no denying the have a case. However, we will be the net losers of any gains made by these member states. We are heavily dependent on agriculture and have given much in terms of food production. We would be serious losers should there be a major realignment by 2013. We are in the dark in terms of the proposals being made. The tom-toms are beating. People want to move away from the historic 2002 criteria and introduce a new system that will have a flattening-out effect. As the Minister said in his speech, this might not affect the dairy sector but it would have serious repercussions for beef and other commodities vis-À-vis the west and the east. Whereas the new member states have a right to seek readjustments, this cannot be done in a vacuum. We cannot afford to be net losers of CAP unless there is a complete reappraisal of EU aid for all countries on all programmes. If Ireland is to be the fall guy in terms of CAP, it can then make a case for a total realignment of Structural and Cohesion Funding, peripherality compensation and so on. One cannot consider only one issue in respect of which Ireland would be seen as gaining. We cannot consider CAP on its own but must examine the totality of European funding and support.

There has been criticism of the fact that we are basing our claims on 2002-2003, which is the only criterion related to activity. Farmers are rightly insisting that EU grants and support be targeted at active farmers. An issue brought to my attention during my preparation for this debate is that people active in farming, as opposed to conglomerates, are the ones who should receive supports. I do not wish to repeat what has already been said by other speakers. Ireland is proud of what it has given to Europe in terms of a high quality product, modern technology, progressive farm methods and sheer hard work. No one in the world works harder than the Irish farmer. If the EU were to introduce new systems that would in any way jeopardise Ireland's output, quality and tradition of feeding Europe, it would be doing a disservice to Ireland, itself and the world at a time when starvation is a reality for millions of our fellow citizens. I wish the Minister well.

Paddy Burke (Fine Gael)
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I welcome the Minister of State, Deputy Finneran, and acknowledge the interesting points made earlier by the Minister, Deputy Smith, in his speech. I welcome also the opportunity to say a few words on CAP. This is an important debate, for which I thank the Government side. As stated by previous speakers, agriculture is the largest indigenous industry in Ireland. Why then should we not give it prominence? It is only right and fitting that we have a proper debate on CAP reforms.

I congratulate Deputy Michael Creed and my party leader, Deputy Enda Kenny, on engaging on this issue throughout the country. They have held several public debates on CAP reform. I attended a public meeting in Claremorris which was attended by approximately 600 people from the ICMSA, IFA, ICA, other organisations, press and so on. It was an important and interesting debate at which the IFA, ICMSA and ICA representatives and journalists made some important points. It is important all of these debates are filtered into the proposals to be put forward by Government in the context of CAP reform in 2013.

There is no doubt that we have witnessed huge changes in agriculture during the past 50 years. I recall there were once at least 400 full-time farmers in my parish of Mayo Abbey. I do not believe there is one full-time farmer in that parish today, as is the case in many other parishes throughout the country. There have been significant changes through automation and new machinery and methods. There have also been significant changes in world prices as well as a major shift in emphasis. At one time, every farmer had a few cows and sent some milk to the creamery. The creamery cans, which every household had, were collected. People had their own vegetables, potatoes, eggs and, in some cases, bacon. They were almost self-sufficient and in many cases all that was purchased was a bag of flour, sugar and tea. Farmers gave freely of excess vegetables and potatoes to their cousins and people living in towns. That is an era many Members of the House can recall. Now we have farm payments but no potatoes, vegetables or creamery cans. However, we have much farm machinery. We also do not have full-time farmers. There has been a major shift which will transcend into the new eastern European member states of the European Union. They will look for their pound of flesh when the time comes during the negotiations on the 2013 CAP reform.

An organisation which played a major role during the past 50 years is the co-operative movement. This is an area the Government should examine. The co-operative movement raised this country from its knees. We had big and small co-operatives for various items, including milk and vegetables, and even the credit unions came from the co-operative movement. It had a significant input into Irish society and the building of the new Ireland. The Government should consider supporting the co-operative movement and taking on board some of its ideas. It still has a major role to play. Some co-operatives became public limited companies or were privatised, but there is now a shift back, and Glanbia is returning to being a co-operative and giving its milk processing back to shareholders and the co-operative movement. The Irish Co-operative Organisation Society, ICOS, has also played a significant role. It has made a submission to the Government which should be examined very closely. It has tabled very good proposals.

As Senator Bradford stated, we should consider the three areas of sufficient food supplies, high quality food and doing everything possible to keep family farms intact. We all have our own ideas of what a family farm is about and it is important to this country, whether it is full-time or part-time. In most cases, a family farm is not let out of the family and people do not want to let go of it. We must bear this in mind.

This country has come a long way in the production of high quality food and it costs an enormous amount of money to produce high quality food to the level it is produced to in this country. This is why it is our largest indigenous industry. We have stuck at it, put quality standards in place and persevered. Europe has helped us with this. One who travels to Europe occasionally looks for Irish products and if they are available, one will buy them. Bord Bia has an important role to play in the promotion of Irish food abroad. We are an exporting nation. We produce more than we can use so we must export it. We must have a good product and, as Senator O'Toole stated, we are up against world trade prices and countries such as Brazil and Venezuela which produce massive quantities of very good quality beef. That will enter this market, as did New Zealand lamb. We must be able to compete with these and this is why supports are very important. The Government must seriously examine keeping supports in place.

The submission made by ICOS is very important in terms of keeping supports in place in the lead-up to the CAP reforms, especially with regard to milk production because as we have seen the number of milk suppliers are dwindling. As I stated earlier, there used to be a creamery can outside almost every house in the parish of Mayo Abbey. I do not think there is a full-time milk supplier in that region at present. There may be a handful of suppliers but I doubt they are full time.

The Minister, Deputy Smith, acknowledged that the support system worked in 2007 when the price of milk was kept up by intervention. If that had not been the case, we would have seen further milk suppliers leaving the industry. We must also take note of the weather and the high and low seasons of milk production. We have higher costs than other countries which have a longer high season than us. We have a shorter high season which gives us peaks and troughs. Processors have difficulty with production because they have either a glut of milk or no milk. These are the hardships they must put up with.

I compliment ICOS on the work done in the submission it made to the Government. It has made seven proposals which could help the Government stabilise milk production and increase it by up to 20% if the proper supports were put in place. ICOS proposes issuing contracts between suppliers and co-operatives; an order of priority; and where capacity is fully allocated and additional capacity is necessitated, those suppliers wishing to supply additional milk should contribute to the cost of the expansion. These ICOS proposals should be seriously considered by the Government, and ICOS is to be complimented on its submission. Mr. John Tyrrell is to be congratulated on behalf of ICOS and its board on tabling those proposals.

I am delighted we are having this debate on the CAP proposals. As I stated, it is very important. I hope it is not finished today and that we will return to it. The Minister was very positive in what he stated on some of the issues. He is well aware and up to speed with what is happening. The farming organisations will also welcome the opportunity to have an input.

Fiona O'Malley (Independent)
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Like the previous speaker, I am glad we are having this debate because it is very timely that we examine the future of Irish agriculture. It is also very important that people who have no vested interest contribute to the debate. In that sense, I count myself as one such contributor as I do not represent a rural constituency but, as a Senator, the nation as a whole. Given that agriculture is such a vital part of our community, a point to which the Minister referred in his speech, and the importance of the network and community level involvement which agriculture represents, it is incumbent on all of us to be interested in the future for Irish agriculture.

We need to have a very broad overview as to what will happen. I attended the meeting of the Joint Committee on Climate Change and Energy Security today, at which the Minister, Deputy Smith, is giving a presentation. Unfortunately, I did not have a chance to ask him a few questions, in particular on new departures in agriculture, such as forestry. I was very conscious of how farming today will not be the same as it was previously as a result of advances in practices. We need to be honest and real about this. The money which was previously available will not be available again. We need to develop sustainable ways of farming and agricultural practice. What I mean by the term "agricultural practice" is something that is all-encompassing.

We are agreed on the social importance of agriculture to the economic and social community. Therefore, we need to determine how we will keep people occupied on the land in rural areas, in particular, in an industry which is sustainable. It is never a good idea to have people dependent on subsidies, but we need subsidies which will allow us to kick-start a viable and growing industry. The Joint Committee on Climate Change and Energy Security discussed the issue of agriculture, in particular the new departures in our transport system, for which farmers can provide opportunities through growing bio-gas or miscanthus. It is something about which we need to get real.

In the Minister's presentation to the committee he was quite adamant in saying he is not interested in dealing with the responsibility the agricultural sector has for our carbon footprint in the world. He said cutting down the herd is not an option, which I was glad to hear. Agriculture is universal and global, as is our carbon problem. What is the point in cutting the herd here because it suits our figures when we are importing beef or whatever from halfway around the world? We need joined-up thinking on the matter.

The major opportunity for the agricultural sector in Ireland centres on green energies. As I said, we need to have a system which provides a playing field for farmers to invest in long-term projects such as planting trees and forestry. I can imagine a farmer would be reluctant to begin a project which may not yield any income for many years. Naturally, there must be a stimulus package for farmers which must be based on a sustainable system, in terms of its environmental potential and, more importantly, its economic potential.

I read the IFA's briefing, which stated farmers cannot be asked to produce products at a rate which is lower than the cost of production. When I read that, my response was that nobody is forcing them to do that. Clearly, the normal parameters of a market economy do not operate in agriculture. One would not continue to produce something at a loss to oneself. I am slightly confused as to why farmers continue to operate in that way. Why would they not diversify into an area in which there is more money to be made?

I heard an earlier speaker refer to the fact that in Ireland we can have a cachet for quality. We can produce products at a very high standard. We supply the gourmet market in France, in particular. However, we are not very good at selling the quality things ourselves and recognising and appreciating the value added we can get on the bare minium cost of a product.

On beef quality, about which I do not know a great deal, one knows basic facts, such as that while Brazilian beef may be very good to taste, it is a different product to what we have in Ireland. Rearing cattle in the open is much more beneficial than keeping livestock indoors, which is the case for a lot of the meat which is produced. We need to add value. If one knows one is buying an Irish product, one is getting added value. Therefore, we should encourage farmers into the high end of the agricultural sector.

Many years ago I heard a farming programme on the radio early one morning at a time when there was a problem with Brazilian beef and the IFA was exercised about stopping it coming into Ireland. A man made a very interesting point; he wrote a piece comparing the situation to the Olympics. He said we should imagine cattle and markets were like the Olympics. In the Olympics, everyone is of the one standard; one is not allowed to take growth hormones or performance enhancing products. It is not the case for cows. If one is at the Olympics, that is, the market, a Brazilian cow could be pumped up for performance without a problem, but an Irish cow is not allowed to enhance its performance in the same way because we have higher standards. Yet, both were able to go to the same Olympics, that is, the market.

That piece explained a lot to me. It is deeply unfair. If one is operating in a market, everyone should operate to the same standards. I have a great deal of interest in the developing world and sustainable agriculture within it, but to a certain extent markets in Africa, Brazil or whatever need to be developed in a major way. I can understand why the IFA became very exercised about not allowing beef with hormones or growth promoters into Ireland. People were operating to a different standard. I do not like protectionism of any kind, but I understand we need to keep a level playing field.

We need to be careful about what we allow into Europe, in terms of standards and quality. We are in a good position regarding our reputation, which we do not exploit enough in terms of the quality added value an Irish product can have. We should promote that in a major way through labelling. The European Union might take a dim view of this because we are meant to be in the one market together and cannot promote Irish products above others. However, at the end of the day we must protect our own interests at home and where we have an advantage over others we must use it.

We must not interfere with food production units or where and how food is produced. That is where we have, in some ways, gone too far in terms of land use, in particular in the European Union. We have moved in a big way into the green economy area. There are opportunities for people but we must keep firmly in view the fact Europe must feed itself. I have listened to many people who were involved in agriculture for many years, including when we joined the EU. What they have said is very interesting in that one of the goals of the Common Agricultural Policy should be that Europe can continue to feed itself and that we should not lose sight of that. It could be said that somehow we let that slip with globalisation and with many food products, which are cheaper to produce, coming into Europe from all over the world.

Part of the talks on the review of the Common Agricultural Policy will be about ensuring Europe can continue to feed itself. This should be the beginning of talks about the future of Irish agriculture. So often, it is all about the next few years, the next round of talks or the next round of funding and not about the long term. We should focus on what the future of Irish agriculture will be in ten years' and 20 years' time. We should keep our eye on that as well because there is no doubt that agriculture will continue to be an important part of Irish social and economic life. It is important we get it right and build a sustainable agricultural sector.

David Norris (Independent)
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I believe I have already congratulated the Minister of State, Deputy Connick, but if I have not had that opportunity, I do so now and welcome him to the House. I am particularly glad he is present because, approximately one week ago, a very interesting meeting on safe food was organised by our colleague, Senator Buttimer, with John Dardis, the head political person in Safe Food Ireland, which is a North-South body. We discussed some of the issues around traceability and the impact of good farm products on the Irish diet and people's health. I know this is an issue in which the Minister of State has a particular interest.

Some people expressed surprise that I should speak about agriculture but we all have our roots in the bog. My grandfather inherited three encumbered farms and tried to make a living out of farming. I know something about the hazards of that particular way of life.

I thank the IFA for the very interesting briefing it gave. I will not rehearse the entire thing because I am sure Senators have put much of it on the record. In my experience, farmers are direct and simple people who are capable of giving clear expression to complex ideas. I just met a group of them in the visitors' bar where I was looking for a group of taxi people who wanted to brief me and said they would see me there. I did not meet them but I met the farmers who had some interesting things to say to which I will refer presently.

For all the excellence of the IFA's briefing, it over-estimates my intelligence in terms of the acronyms involved and the very dense language. I puzzled myself in trying to reach an accommodation with what is very complex language. It stated that the two central issues for it are maintaining the real value of the national envelope covering both single farm payments and rural development which is worth €1.7 billion per year. I am sure there is an easier way to express that or a way for it to give a glossary of these kinds of terms.

I can quite easily comprehend the next issue, which is that for individual farmers, the key issue is securing the full single farm payment and continuing to pay it on a historical basis. When one gets into the substance of the document, however, there is a lot about various axes, pillar two, flexibility within member states and so on. The idea of a single farm payment modulation could be expressed simply. I am a supporter of the society for the protection of plain English and suggest it would be useful in dealing with briefings for Members of the Oireachtas if the IFA kept it as simple as possible because not everybody has a direct connection with farming matters.

I support the CAP and the Minister in his entry into the current round of negotiations. I support, in particular, subsidies which are accurately targeted and do not negatively impinge on the developing world. There is a balance to be struck because some of the agricultural policies of the European Union have been perceived as having a negative impact on countries which are sometimes described as the Third World. In conscience, we need to ensure as far as possible that this does not happen.

In a troubled and difficult world, it is very important to maintain the agriculture sector. It has had a very difficult time. Throughout the past year to 18 months, a succession of farming groups have received cuts in their wages even before the real impact of the crash, and I am sure the Minister of State knows that because he will have met some of these people. For example, I have no idea how sheep farmers continue to live on the dwindling returns they get for very heavy work and substantial investment. I do not believe anybody in Leinster House would be prepared to work for those margins.

The other significant factor is the dearth of young men and young women going into farming. It is no longer a tradition that is passed on or, in many areas, seen as a viable option for young people of talent, which it should be. We should support young people in every way possible to ensure they go into the industry and continue the tradition of farming. That would guarantee a stable rural society and food security in the future for the citizens of Ireland. That may very well become an important item in the programme.

We need to look at sustainable food production, especially in a manner that is environmentally sustainable. We should brand and promote the excellence of Irish products, in particular Irish beef. We do not use particularly intensive methods and we are closer to the natural rhythm of life. We do not use chemicals, hormones and so on to the degree which other countries do, including Brazil. I congratulate the farmers' lobby on having had the initiative to go to Brazil to investigate what is happening, to go to the farms and to illustrate on the Saturday morning farming programme on RTE that the traceability of Brazilian beef scarcely exists. At least in Ireland, we can be secure and trace our major food products, including beef.

I wish to raise the concerns of my friends of approximately 15 minutes ago. I was looking for taxi men but instead I found councillors from County Limerick. I did not know at the time they were councillors and I still do not know to which party they belong, if any.

Seán Connick (Wexford, Fianna Fail)
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They were from my party.

David Norris (Independent)
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They were the Minister of State's lot. That is fine by me. I am not prejudiced at all. I am totally politically promiscuous, as the Minister of State knows. I have friends in all parties and do not believe I have too many enemies in any of them.

These people were involved in beef farming, both dairy and meat production. The point they made was that the new grading system introduced by the EU seriously prejudices their interests. They used a certain amount of technical jargon which I complained about in regard to the briefing from the IFA. One fellow could see that I was a bit dazzled and he said he would put it simply. He said that if he turned up at the mart with a lorry with 15 animals in it, in the old days he got more or less the same price for the lot. He said that now the grading system has become so minute, particularised and sophisticated, he would get 12 different prices for the 15 animals. This makes it difficult for the farmer to organise his budget. This is information I have received by accident direct from the coalface today. We need to review the system of grading.

Having mentioned Brazilian farming methods, I will comment briefly on American farming methods because they serve as a warning for Ireland where farming is a great tradition, including in my family. The United States has moved away from small farms and small farmers hardly exist any longer. What one has are corporations and enterprises that are quoted on the New York Stock Exchange, vast ranches, highly artificial methods of production and tasteless beef. Chicken, on the other hand, sometimes tastes of fish meal. When one puts a forkful of it into one's mouth one thinks one is eating cod, which is most unpleasant. One also has watery eggs and there is little in terms of guarantees.

Where intensive farming is used - this is particularly true of the poultry industry as opposed to the beef industry - the corporations operate a high security system and will not allow investigation by members of animal welfare organisations because they are ashamed of the practices used. This is not only a matter of humanity and dealing with our relatives down the DNA chain. Animals are our relatives, have feelings and deserve respect. It is not only a matter of showing respect for the rights of our fellow creatures but also of the effect the practices in question have on the quality and taste of animals. We must be aware of the American approach which has squeezed out small farmers and created huge ranches. I would hate to see this happen here as it would be bad for agriculture, production, consumers and, most certainly, rural society.

The Minister framed this debate in the context of a European Union budget review and the new EU financial perspective for 2014 to 2020. This makes it an important discussion. The Minister also committed himself to an objective that is dear to my heart, namely, the preservation of family farming in Europe. There is, however, a political dimension to this issue. If that were not the case, the matter would be redundant for those who have a view of farming at one remove. We are all interested in the political dimension and support the Minister of State, Deputy Connick, and his senior colleague in what they are doing. They have worked politically to create a support network among other Ministers in Europe for a strong and properly resourced Common Agricultural Policy after 2013. I was heartened to read in the Minister's contribution that, after the meeting of the group of 22 like-minded EU Agriculture Ministers in Paris in December, there was a feeling of cohesion. In other words, we have allies in Europe with whom we can work in the interests of European agriculture.

As I stated, there are a number of significant elements to this issue on which the Minister will have been briefed. He will also have been told by my colleagues about the importance of rural development funding, young farmers and sustainable food production, about which I have spoken.

The Brazilians are among the world's major exporters of beef and the European Union is the largest importer of Brazilian beef in the world. This has an impact on our agricultural sector and, through deforestation in the Amazon basin, on the environment. Having had the privilege of visiting the Amazon basin, I have seen its beauty and remarkable capacity for sustaining life in all its forms. It is a very important resource in terms of drugs, plant life and so forth. The cattle sector is responsible for 80% of deforestation in the basin. This is a further reason for Ireland to sustain its beef industry, even if it is at the expense of our neighbours, albeit not very close neighbours, in Brazil.

I commend the Minister. All sides in the House will support positive moves. I hope that in this troubled and difficult world, we will take wise and judicious measures to secure a supply of good food, encourage agriculture and ensure young people enter the farming sector.

Jim Walsh (Fianna Fail)
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Cuirim fáilte roimh an Aire Stáit. I congratulate the Minister of State, Deputy Seán Connick, on his appointment. He and I served together on New Ross Town Council more than a decade ago. His business acumen, ability and affability will stand him in good stead in his new position. We are fortunate to have an individual of his calibre in the Department at a time when serious challenges face the agriculture sector. The Minister of State and Minister, Deputy Brendan Smith, will be of tremendous assistance in ensuring Irish agriculture is not seriously disadvantaged as a consequence of the review of the Common Agricultural Policy from 2013 onwards. The determination and interest the former has shown in serving people at local level will transfer to the national level. I have no doubt he will serve with great distinction and wish him well in that regard. It is a pity the Gallery has been vacated because many of the Minister of State's friends and neighbours from adjoining parishes in south Kilkenny have just departed and would, I am sure, have liked to have been acknowledged.

Senator Norris and others noted that during the transformation of national economic life in the decades after independence the agriculture sector was the main driver of economic activity. While the position has changed in recent decades, the sector remains of major importance.

Agriculture is well served by its representative associations, notably the IFA and ICMSA, and other rural development groups. These organisations have become extremely proficient and professional in the manner in which they pursue the interests of their members. These attributes will be required in the debates on the forthcoming reform of the Common Agricultural Policy. I and most Members will support these bodies in the pursuit of their objectives, specifically the maintenance of a fully funded, index linked CAP budget post-2013. The IFA and ICMSA are also anxious to ensure that family farmers are not forced to produce below the cost of production. This is a major challenge and will probably become a key issue in debates between consumers and producers in the European Union given that countries that are net consumers tend to seek to drive down prices.

The development of the co-operative movement over the decades has done much to ensure produce from our agriculture sector secures the added value necessary in order that the benefits of exports accrue to the economy generally.

We all support the continuation of sustainable and viable food production, which is among the objectives of the farming organisations. They are also anxious to ensure that the annual allocations of €1.5 billion for the single farm payment and €100 million for rural development continue. An extra production link payment for vital production systems, including suckler beef and sheep, is also on their agenda.

They are looking for a continuation of the co-financing commitment by the Government.

Recent events within the EU cannot be ignored, even though there has been a certain amount of posturing involved. Leaked Commission draft papers certainly have raised concerns, as major policy changes were advocated including lower funds for the CAP. While they may be early drafts, they are significant and we need to be cognisant of what is happening. A timetable has been set out wherein formal communication will come from the Commission this summer, followed by legal proposals in 2011. The challenge this time around is greater, because we are facing a larger number of countries than before. As there are now 27 EU member states, there is great difficulty in getting consensus on any issue. That is addressed to some extent in the Lisbon treaty.

As somebody who is critical of our public service from time to time, I must acknowledge that those who have assisted in negotiations with the EU have generally done a very good job and served this country very well with their acumen, their ability and their determination to ensure the deals that were made served the national interest as well as the European interest. The Minister and the Minister of State have the personalities to build the contacts and the relationships that are essential at EU level to ensure the interests of the agricultural producing countries are very evident in the outcomes of those deliberations. France has been particularly supportive in the past, and while we may have differences with countries from eastern Europe on redistribution, countries like Poland will have a strong emphasis on family farming and that is important. The idea of being a guarantor of food security is essential, and the support of EU family farming is extremely important in that respect.

Senator Norris and others referred to the agriculture industry over the decades. I spent most of my school holidays on a farm in south Carlow. They were very small holdings and the people there lived in unserviced houses, and it gave me an insight into the culture and thinking of people in that rural area. There was a very distinct self-sufficient feeling and an air of accepting their lot, which was one of very limited financial resources at that time. However, they were rich in culture and personality. Listening to the story telling and so on, I often thought that young people in better times in Ireland could benefit from some of the education which that process provided.

Senator Quinn made some interesting points about the increase in world population from 6 billion to 9 billion by the middle of this century. When we look at the extent of the current population of the world that is starving, this population increase will require a co-ordinated global management system to ensure our agricultural sector is producing the food at the right price in order to cope with that increase. There is a significant statistic which shows that the importation of agricultural foods from outside the EU is worth about €70 billion annually. The cost of the CAP is about €55 billion. We import more than many of the other countries, including the USA, New Zealand and Australia put together. This is an issue that must be taken into account to ensure the family farming structure in the EU is maintained in the negotiations and is not sacrificed to cheaper food from outside the EU, which may not be sustainable and which may have an impact on climate change.

I wish the Minister and his colleagues well in this area. The House will be returning to the topic in the not-too-distant future as this debate rolls on.

Joe O'Reilly (Fine Gael)
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There is a very poignant background to today's debate. A leading member of the agri-industry, the largest pig farmer in Europe and a great member of our county community has died today. Patrick "Buddy" Kiernan would be very well known in agricultural circles and his death is a sad backdrop to the debate.

There is a number of core issues that merit mentioning as we look at this question. A total of €1.3 billion comes into this country every year in payments to agriculture from Europe. That is an extraordinary figure and one that merits preservation. Agricultural incomes have been on the floor in recent years. The average agricultural family net income is €13,000 and that is not sustainable. It underlines the importance of the CAP to our farmers.

There is great potential for economic recovery through our agriculture sector, including our food sector, our value-added product and our grassland based product. Irish food has a potentially enormous market. The world population is growing enormously and feeding that population will be necessary. The potential for the Irish food brand to stand out must be great. We have a clean environment, good grassland production, a good reputation, and we have much to market.

There will be a co-decision dimension to CAP reform and the European Parliament will be involved in it. This makes it incumbent on all of us to lobby our respective groupings in the European Parliament. As Senator Bradford pointed out, it is a green jersey issue. The Commission is reviewing the European budget, and it is critical that agriculture holds its portion. It is encouraging to learn from the Minister that 22 like minded member states have recently come together in support of the Common Agricultural Policy. This is good news. As the world population figure of 6 billion is expected to grow to 9 billion, obviously food security in Europe is a major issue. It should be a pillar of our future position.

There are dark clouds on the horizon in that the South American states around Brazil have come together in an effort to re-enter the European market. While we have no objection to free trade and the development of their agriculture sectors, we need to be particularly vigilant, given that there have been critical meetings of a number of South American states in recent weeks. Our contention must be that the same standards of veterinary and environmental compliance and animal welfare should apply in countries from which we import. This is critical to the concept of a level playing pitch that we should advocate. While the flood of Brazilian beef has been halted, the problem may be emerging again, with enormous implications for the beef industry here.

The bottom line for Ireland must be the preservation of the single farm payment. If we need to concede a little, the wise money suggests we should concede that we might look at having a maximum payment, not modulated payments. That would involve the maximum figure anybody could receive, but we would be equally conscious of the need to maintain a very sensible minimum payment in order to preserve basic incomes. The bottom line needs to be preservation of the single farm payment, although people talk about preserving the environment by other methods, etc. It is worth mentioning that cross-compliance is required to receive the single farm payment. Farmers are required to be compliant with environmental standards for water quality, etc. The preservation of the environment and the production of healthy and good food are achieved under the existing single farm payment system. This is a point we need to reiterate strongly at European level.

I pay tribute to Deputy Creed for organising meetings on the Common Agricultural Policy around the country. Last week I attended one such meeting in Castleblaney chaired by my constituency colleague, Deputy Crawford, who is an expert on agriculture, given his background in the leadership of the IFA. At the meeting Mr. Matt Dempsey of the Irish Farmers Journal said that if a flat-rate payment, towards which there is movement, particularly in eastern European countries, was introduced, this country would lose at least 20% of its payments. Obviously, the bottom line for us is retention of the single farm payment, although we might look at having maximum and minimum payments. The point was well made at the meeting which was attended by several people with expertise in the area who said land values would fall greatly and that we would lose considerable amounts of money if a flat rate payment was introduced. They also made the point that if we were to renationalise the Common Agricultural Policy to the degree that each country would decide on its own payment levels and make its own payments to its own farmers, we would also lose in the allocation. Therefore, we need to preserve the status quo.

It is good that we have 22 countries on board supporting us. There will be a united position on the part of the IFA, the ICMSA and all the political groupings here. The Irish view will be united on this national question, on which our entire livelihoods and the future of the country depend. Irish agriculture has great potential. The world population will need to be fed. As the years go by, there will be greater demand for food from a healthy environment in which production is green grass-based and without the level of industrialisation achieved and pollution in other countries. There is great marketing potential, based on the nature of farming here and its traditions.

There is a case for considerable investment in innovation. We are not doing enough in the food sector in terms of investment in innovation and research. We need to ensure the Irish label stands out and eliminate the process whereby a few breadcrumbs are put on food and it is rebranded as Irish when it has been imported. I appeal to the Minister to take these considerations on board as we develop an Irish position. There is probably nothing of more significance to the areas represented by Senator Carty, the Leas-Chathaoirleach and me which cannot survive without the CAP.

Rónán Mullen (Independent)
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Ba mhaith liom fáilte a chur roimh an Aire. Seo an chéad uair dom bualadh leis sa Teach seo. I welcome the Minister of State.

I am very glad to have an opportunity to make a statement on the Common Agricultural Policy and that this House has an opportunity to discuss an issue of such strategic importance to the economy and the future of rural areas. I know this will be one of a number of such debates we will have. Rural areas have been subject to a disproportionate amount of the pain during the current economic crisis. The implosion of the construction sector has hit employment in rural areas hard, while the collapse in the value of sterling has impacted negatively upon Ireland's food exports and prices paid to farmers. Unprecedented volatility in commodity prices, in particular the price of milk which has only recently begun to improve, resulted in the incomes of farm families being slashed.

To understand fully why rural areas are suffering so much one must understand the nature of employment in these areas. Some 42% of the population live in rural areas, but these areas account for a mere 28% of the total number of employment opportunities. In urban areas women form a slightly larger percentage of the workforce than men, but in rural areas men form a much greater percentage - approximately 60% - and many of them were working in construction. Rural areas are, therefore, feeling the pain and the agrifood sector is one of the few palliatives available to ease it.

The agrifood sector is of fundamental importance to the economy. Almost 50,000 people are directly employed in the food and drink sector, with a further 60,000 employed indirectly in all regions of the country. The industry uses 90% of the output of Ireland's 120,000 farmers. In 2008 it accounted for a figure of €8.3 billion or almost half of all purchases of Irish goods and services offered by manufacturing industry. It is one of the few major industries controlled mainly by indigenous companies. While the agrifood sector is of importance now, it will become even more important in the future.

The world not only faces a global credit crunch, but also population growth in the Third World, the rate of which will only begin to decrease by 2050. The impact of climate change and peak oil also need to be considered. Paradoxically, tackling some of these global challenges offers real opportunities for rural areas. The world's population is predicted to reach a figure of 9.2 billion by 2050, thus creating an enormous market for Irish food producers. After 2050 it will decline, massively so in Europe, which means exports to countries outside the European Union will become key. Furthermore, the need to move away from fossil fuels offers opportunities to Irish renewable energy companies to exploit Ireland's potential to grow biomass for fuel production.

We need to look at new ways to develop the food sector and maximise the number of jobs we create from what is, after all, our greatest indigenous industry. The development of the sector has been hindered by a view in some Departments that agri-food is a sunset industry and merely a means of providing subsidies to farmers. This is a nonsensical view which is not shared by the Minister of State or his Department. Agri-food is one the leading elements in the smart economy and the best of our dairy farmers are among the best educated and professional workers in the State. The industry is a leader in research and development of new food products and ingredients.

If one speaks to a dairy farmer, the first thing that may strike one is how knowledgeable he or she is about global economic affairs. Dairy farmers know as much about the strategy of Fonterra, the New Zealand dairy company, as they do about the local hurling club and are as much concerned by growth in China as by prices in the local mart. The reason is that the price of milk is set as much now by international markets as by Glanbia. Price and income volatility in agriculture have increased greatly since the 2003 CAP reform, with a decoupling of payments from production and greater exposure to an increasingly liberalised and unregulated world market which threatens the viability of the family farm structure. EU policy makers must learn from the experiences of recent years and mend CAP structures appropriately to counteract this volatility. EU food security can only be attained through promoting policies that secure the production of sustainable high quality food produced in Europe for European consumers.

After 2013, the Common Agricultural Policy should form a framework that will enable Ireland to develop fully its sustainable grass based agricultural potential while equipping farmers to work and survive in an incredibly volatile market place. Ireland's grass based production system ensures that Irish agricultural production is much more environmentally sustainable than that of other key exporting nations such as Brazil, Uruguay and Argentina. CO2 emissions per kilo of beef are twice as high in Brazil and CO2 emissions per kilo of milk are five times greater when compared to Ireland. The EU is the biggest importer in the world of agricultural products from non-EU countries and Brazil is the largest beef exporter into the EU. The rapid growth of beef production in Brazil in recent years to facilitate the major growth in exports to the EU and other countries has resulted in the destruction of thousands of acres of Amazonian rain-forest, as noted by Senator Norris. The cattle sector is responsible for 80% of all deforestation in the Amazon region which, as the Senator mentioned, has removed essential forestry carbon sinks.

In a policy environment where climate change measures are being negotiated and agreed the demand for sustainable food production is rising. Irish agriculture is well placed to meet this challenge and must be supported to ensure the continued production of food produced with low emissions for the EU market. In any negotiations on the future of the CAP we can and should play the green card. As Senator Bradford said, it is a green jersey issue. The card is not that of Irish nationalism but of sustainable food production. If we do this we can create and secure a brighter future for both Irish agriculture and rural Ireland in general by creating employment and contributing towards balanced regional development.

I was very taken by Senator Bradford's excellent summary of the issues, in particular, his three "F"s - food security, food quality and farming families. I was present for the Minister speech and listened to it very carefully. It was very noticeable that the Minister is in a very difficult position and this was reflected by the great caution in the language of his speech. I was not just reading between the lines: it was clear that very tough negotiations lie ahead. The communication paper issued by the Commission last November already advocates major policy changes and lower funds for the CAP.

In the first place we find ourselves striving to find a unified position among the different interest groups in Ireland. I am grateful to the IFA for its excellent summary. Although I understand the organisation is anxious to maintain the historical basis for the single farm payment, I emphasise that we must look also at every method of supporting the entry into agriculture of talented young farmers and the promotion of land mobility. I accept there are issues that must be kept in tension. We are conscious we must show solidarity with countries within the EU that face even greater challenges than we do. We also must find a way to show solidarity with the developing world and ensure that our policies at EU level must not be selfish enough as to exclude their interests. That would be out of synch with our great tradition of missionaries and voluntary workers abroad, the great globalisation of the Irish humanitarian mentality.

At the same time, just as all politics is local the agenda must have a real emphasis on the value of local life and rural life, the value of being able to consume local food produce and how important that is for sustainable communities and healthy living. We may think of the concept of subsidiarity in other areas when we discuss the need to keep things local. That is especially true when we are talking about not only quality food but locally produced food. I was impressed with what Senator Ó Brolcháin had to say about the flying of broccoli although at first I was not sure what he meant. He made the point very clearly and cogently.

There are issues in tension with each other. They include our global vision of solidarity and our recognition of the demands of other newer countries within the EU but also our sense of the importance of maintaining our traditions and way of life . We must try to ensure the national envelope is maintained as high as possible while recognising that these negotiations will be extremely difficult and we must be realistic about the changes that are to come.

As a speaker from the west, I recognise that some, whose payments have been based on production, have probably done better in some parts of the country than in others. Obviously, I would like to see equity for farmers in the west in particular. It is very important we do not lose sight of that.

I assure the Minister of State of the good wishes of everybody on all sides of this House. We know what a difficult battle lies ahead but know also the importance of putting the best foot forward. The issue will be more difficult because of the new co-decision role for the European Parliament in the determination of the CAP. The Seanad will return to this topic with great interest and concern and will follow its progress over the coming months and years.

Fidelma Healy Eames (Fine Gael)
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The Minister of State is very welcome. It is my first time to address him in the House. It is interesting to note the number of speakers on this issue which shows how important the renegotiation of the CAP is to Ireland.

At present we get €1.3 billion from Europe in single farm premia. That is a substantial amount of money which helps many people in this country. I was encouraged to see, however, that the CAP represents less than 0.5% of the overall EU gross domestic product, GDP, budget. I would be very fearful that the CAP would end or that the single farm premium would be taken away from Irish farmers but am encouraged to see that it represents such a small amount of the EU budget and that 22 countries are already on board. The Minister of State might tell me when I finish which countries are not. If I were to guess I would say the giants.

I have seen farming go through enormous changes over the years. I grew up on a dairy farm and am married to a farmer. I saw a time when it was possible to produce in dairy as much as one wished. Then there was the time of the milk lakes and beef mountains - oversupply - followed by the quota systems. As a result we went through control. Once a farmer is controlled he or she must be supported in some way to maintain an income.

I did not catch every speaker today but I listened to some, such as Senator O'Malley, who asked why we did not offer subsidies as a jump start. There are only two ways in which an Irish farmer can make money at present; through market price by getting the price for the produce, or through subsidy in the form of the single farm premium. I, too, have asked that very question. However, the fact is that the subsidy exists for the consumer not for the farmer. We must get that message out loud and clear. It is only because the farmer gets a subsidy in the form of the single farm premium - previously there were other premia - that the cost of food is not enormous. The consumer would suffer otherwise. The market alone will not allow farmers to realise enough money from their produce.

I spoke to a small number of farmers today in preparation for this debate and asked them why this issue is so important to us. The view was that the continuation of the fund was needed and farming cannot survive on its own in the country. We are a special case as our parcels of land are too small and we need relatively intensive farming compared with other countries in the EU. As a result, farmers are dependent on subsidisation.

For example, we cannot run one bullock to ten acres as we do not have the scope or the space. Other states in the EU have large tracts of land. I spent time in Romania which has very large tracts of land, and France and Germany are the same. I am sure the Minister of State will be part of the negotiating team when we go to Europe and that team must come up with a two-way process that will ensure fair play for the whole of Europe and the Irish farmer. Negotiation between these two goals must be kept in mind.

Ireland, which has been part of the process for a long time, has its payments based on the 2000 to 2002 reference years. That will not work for the newer states, some of which have very large tracts of land. The negotiating team will have to be measured and one size will not fit all. The variations must be taken into account but we are a special case in that we cannot produce or remain viable without the subsidy and our parcels of land are small.

Decoupling has been a success, although there are different views on this as it has made it possible for farmers to plan. It is also possible to farm better with fewer animals in Ireland. Outside of the subsidy, we are totally dependent on exports to achieve a market for our produce, and our exporting is largely through meat plants. Beef and sheep farmers are the subjects of meat factories and, when a person is the subject of anything, he or she is being controlled by it. The price is controlled like this.

Live export is our main hope because we are an island nation and it provides competition in the livestock trade. That is always under threat and especially at times by the Minister of State's partners in Government, the Green Party. We must consider the issue because farming is so volatile. As a member of a household reliant on farming, I can see how unreliable it is as a job and how significant are the costs. We are subject to so much volatility from the weather, disease and regulation. The costs are also significant so without a good renegotiation of CAP, many more farmers will leave the sector.

The more livestock that leaves Ireland on the hoof through live export, the better it is for farming and competition. It is not necessarily better for the economy. If we sell cattle and sheep through the meat plants, we keep jobs in the country and there are spin-off effects into the local economy. That must be borne in mind and there is a market control on us in the need to negotiate a good CAP deal.

These are reasons CAP is so critical and we are so dependent on it. We are, ultimately, talking about keeping farming viable and providing a secure food sector with good quality food. Others have mentioned the growth in population across the globe, and by 2050 we will be up to 9.2 billion people. There should be an extremely healthy outlet for our food production, and, across the world, we have a great reputation for food. Our industry is based on grassland and we should make more of that. I concur with a former Senator who said we must spend a little more on innovation and research in the food industry.

We are fortunate that Máire Geoghegan-Quinn has the research portfolio in Europe and she should consider Irish agriculture and the food industry to see how it can benefit. Creativity is critical in leading to enterprise in this sector. Senator Joe O'Reilly mentioned putting a few breadcrumbs on meat but, with respect to the Senator, there is more involved.

There is a greater dependence on CAP now due to cuts and the mismanagement of public finances by the Government. Installation aid is gone, REPS payments are down 22% and headage is down by 25%. There is a mess in the farm waste management scheme and the suckler cow scheme has been cut, so we are pretty much on our knees.

Fidelma Healy Eames (Fine Gael)
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The suckler cow scheme has been cut. The Senator is talking to somebody who would know. The Government has let farming down and off-farm employment has also dried up. We need to support the family farm and keep the sector viable in Ireland to provide for a good quality food reputation. I look forward to the negotiations and I thank the Minister of State for participating in today's debate, well in advance of the 2013 deadline.

Paudie Coffey (Fine Gael)
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I welcome the opportunity to contribute to the debate. I also welcome the Minister of State, who is from a neighbouring constituency in Wexford. I am sure he is well aware of the challenges facing farmers and farming in general. It is very important we debate this issue well in advance of the deadline. We should be fully informed of all issues relating to the debate and the matter should be properly discussed, not only in the Houses of the Oireachtas but also in farming organisations, among members and in farming families. As Members, we should always be listening to the concerns aired by farmers every day.

Farming is one of the indigenous industries in this country and Ireland has a great track record in farm practices and food production. In the current economic climate, farming could be prioritised. Instead of removing supports and grant aid for farmers, we should introduce incentives for young farmers to innovate and engage with new farming practices that will bring new opportunities to exploit the potential of our land.

Some speakers mentioned the direct payment system which is in place. Many farming families have become accustomed to the system and their financial structure and cashflow is built around it. I suggest it cannot be altered unless the possible alternative is properly thought through, especially as it relates to development-led grants or payments.

In Ireland there could be vast areas around the Golden Vale with significant potential for development but lands in mountainous areas could be disadvantaged and would not have the same access to development projects. I urge great caution in the area and we must be very careful that if there is an alteration in the direct payments, it should be properly weighted and there should be proper allowances for people in areas that may not have the potential to develop fully because of geography etc.

I will speak from the enterprise side of farming and focus on that area of the debate. I attended a day-long conference recently in Dunhill which was attended by the current Minister for Social Protection, Deputy Ó Cuív. It concerned sustainable rural development and dealt with innovative ways of creating employment, keeping farms sustainable and keeping jobs in the heart of our communities. We can see how the co-operative society developed in Ireland over the years and it was a good example of farmers and their communities coming together to create jobs with a critical mass to make them viable and sustainable. There is considerable ongoing debate on whether farmers will take over the Glanbia co-op. In a recent vote, 73% of farmers voted in favour of doing that, just 2% short of the percentage required. I did not get involved in the debate because the decision on managing farmers' futures in co-ops is their own, but they should take control of their destinies. Opportunities exist but the Government needs to support farmers and give them the confidence to engage in such rural enterprises and activities.

Under the corporate structure of Glanbia, many smaller co-ops that were the heartbeat of communities closed. They were the places where farmers met every day, engaged with one another, exchanged ideas and gave advice. We cannot afford to lose them. If we do, the expertise and value in farming will be lost as well. We must develop this area.

According to the conference I attended, 50 jobs were created in a small rural enterprise called Dunhill Cuisine. Its model should be rolled out across the country because it is a small enterprise that takes produce from within a 20-mile radius. Farmers produce food as the primary basis for the produce while Dunhill Cuisine packages it and puts it into ready dinners that are sold to the wider public via supermarkets. Getting access to supermarket shelves is difficult, but Dunhill Cuisine has managed to do it and is now running a successful business. I spoke to the managers of the enterprise. It is creating sustainability in the local area and giving farmers a reason to produce quality food that can then be bought by the public or be exported.

Dunhill Cuisine's managers have an idea about school, hospital and prison dinners, namely, that Irish produce should be used. A system used across Europe involves companies cooking ready-made dinners and transporting them to the institutions in question. In these days of obesity and health concerns, in terms of which there will be significant expenditure, this is a fundamental and simple argument. We should give children and others in hospital good quality dinners instead of the processed foods that many of them are getting. We would kill not one or two birds with one stone but many birds. We would give farmers a reason to produce locally, create employment in the preparation and packaging of that product and create further employment in servicing the institutions. We should consider running it as a pilot project for schools or hospitals. I will pass Dunhill Cuisine's figures to the Minister of State, Deputy Connick, as he is interested in the subject. Issues such as this need to be examined.

I am framing my contribution in this way because CAP and direct payments assist farmers by giving them a cashflow to engage in production and to ensure there is a market for their produce. It is all related. I wanted to bring the idea to the attention of the Seanad and the Minister of State.

Farmers, especially young farmers, face significant challenges. The Minister of State and I know the problems experienced when the sugar beet industry left the south east. The impact has been considerable. Young farmers sustain their farms by working in the construction or manufacturing sector, but many of those jobs are gone and farmers are back on the land. We need to give them a real incentive to make money and become viable. This suggestion has potential if the political will to restructure regulatory systems is present. We always seem to jump in and let our European counterparts follow us. We need to step back as regards food. Farmers markets and food stalls are successful and generate a whole economy. Senator Quinn, who is in the Chair, is supportive of that initiative. We need to get back to basics in terms of determining how to promote Irish produce, finding markets and putting supportive structures in place. This will create a momentum and allow the rest to follow.

Nicky McFadden (Fine Gael)
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I welcome the Minister of State. I echo many of the comments of my colleague, Senator Coffey, on the issue of good quality food, a matter close to the Minister of State's heart. CAP encourages traceability, as was evident during the time of the Brazilian beef issue when we were able to stand over the quality of our beef and poultry products.

The spend to Ireland is less than 0.5% of the EU's gross domestic product, representing €2 per Irish person. I suggest that we get excellent value for CAP. It was introduced to ensure we would never run out of food like we did after the Second World War, but we went to extremes with our butter mountains, beef mountains, etc. Our good quality food is a result of CAP. We are also sustainable in terms of climate change and the environment. I applaud farmers for buying into the notion of maintaining the countryside to its current standard.

My time is limited, but I wish to raise the issue of the historical payments to farmers in respect of animals. Will the Minister of State comment on this matter? Turbary rights are being done away with in some areas, an action that will cause considerable hardship for some farmers.

After the recent serious frost, a horticulturist I know and his friends have been devastated. Potato growers were compensated, so why not horticulturists? The man in question lost plants worth €600,000 in total. Surely there is a grant somewhere to compensate him and his colleagues. What is the difference between them and the potato growers?

Many countries have joined the EU, but we must fight and shout loudly to sustain what we have. Our farmers need us to be their representatives and to shout for them at EU level.

Seán Connick (Wexford, Fianna Fail)
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I thank Senators for their contributions. I have been present since 3.30 p.m. and listening to the statements has been interesting.

I am fortunate to be a Minister of State at one of the country's most important Departments. This is a critical time for agriculture and fisheries. As Senators are aware, the Common Fisheries Policy, CFP, is up for review and most of my first seven weeks have been spent working in that regard. The work of the Minister, Deputy Smith, on CAP is ongoing, so we take our role in this respect seriously. Ireland does not have a significant amount of indigenous industry, but agriculture, fisheries and forestry are critical at this point because they present an opportunity for job creation and further development. During the coming months we will watch developments in CAP post-2013 and the CFP carefully.

As Senator Coffey mentioned, I come from a rural constituency in which the loss of the sugar beet industry has caused difficulties. We almost lost the railway line as a result. The various crises we have encountered have had a significant knock-on effect for the social fabric of areas not just in my constituency, but also in the adjoining constituencies. A number of farmers regularly visit my clinic, so I am fully up to speed on the difficulties they are encountering.

In closing this debate, I will address a number of further points. First is the importance of the agriculture sector to Ireland and the EU. Second is the measures we have taken to provide for a competitive and sustainable agricultural industry. The agrifood sector is Ireland's largest indigenous industry, accounting for 160,000 jobs, some 8.5% of total employment, and 16% of industrial sector output. It accounts for 10% of our exports with an estimated value in 2008 of €8.16 billion.

Senator O'Reilly referred to the fact that Ireland is an export-led economy. It is clear that our recovery will be dependent on growth in this area. Agriculture, as the primary source of input for the agrifood and drinks sectors, will have a crucial role to play.

Senator Walsh referred to the lobbying power of the IFA and the other organisations that represent the sector. These are hugely important organisations and they are extremely professional in the way they operate. I look forward to working with them in order that we might maximise returns for the economy in the coming months.

The agriculture and food production sector is also hugely important in the context of Europe's economic and industrial recovery. The primary agricultural sector covers over 40% of the EU landmass - this rises to almost 80% if forestry is included - and is key to green growth and environmental sustainability. Primary agriculture alone contributes 1.9% to gross value added in the Union and 5.6% to employment. The sector is an essential platform for the EU food and drinks sector, which is the largest manufacturing sector in the EU and which represents some 9% of industrial value added and over 10% of industrial employment. Moreover, it is a sector in which global demand is guaranteed to increase.

Modern, productive agriculture, food and forestry sectors will support green growth by assisting in land management and social inclusion for rural communities. It will also ensure more sustainable use of natural resources and support climate change mitigation. From an economic viewpoint it will provide stable, higher-value employment opportunities that will require higher skill levels and qualifications, greater levels of research and development and, importantly, innovation. It will boost European exports and contribute to food security both within and beyond Europe.

In the context of Senator Carty's comments on the EU's 2020 strategy, the importance of the sector is illustrated by the recent decision of the Heads of State and Government at the spring European Council to include a reference in their conclusions to the need for all common policies, including the CAP, to support the new EU 2020 strategy. This is the replacement strategy for the Lisbon Agenda and it is designed to steer the EU to economic recovery, growth and jobs in the period up to 2020. The conclusions proceed to state that "a sustainable, productive and competitive agricultural sector will make an important contribution to the new strategy, considering the growth and employment potential of rural areas while ensuring fair competition". The inclusion of this point was made at the insistence of Ireland and a number of other member states. The proposed strategy was subsequently discussed by EU Agriculture Ministers and there was unanimous agreement that agriculture had a crucial contribution to make to the strategy in terms of sustainable growth, rural employment, territorial cohesion, mitigating climate change, economic growth, increasing exports and social inclusion.

The second matter to which I wish to refer relates to other more long-term initiatives relating to the agricultural sector. Several initiatives are under way to anticipate and prepare for the more competitive environment facing the agrifood sector in the future and to address upcoming challenges facing the sector. Strategies for the development of a consumer-focused, competitive and sustainable agrifood sector capable of meeting the challenges of more liberalised markets and broader societal demands both at home and abroad are already set out in the Agrivision 2015 report. These strategies identify the delivery of safe, high-quality, nutritious food, produced in a sustainable manner for high-value markets as the optimum route for the Irish food industry to take in the future. They span the entire food chain from primary production through processing to market access, which is key to developing export potential.

A high-level committee, which was appointed by the Minister, Deputy Smith, is currently engaged in an in-depth review of strategic policy for the agrifood, forestry and fishing sectors - looking forward to 2020 - to allow them to cope with pressures from the current economic climate, deal effectively with broader sustainability issues, such as climate change, food security and environmental management, and address some structural and other weaknesses that must be dealt with if the full potential of these sectors is to be realised. The deliberations of the committee are well advanced and it is expected to present a report in June. An interdepartmental market access group, chaired by the Department and comprising representatives from the Departments of Foreign Affairs and Enterprise, Trade and Innovation, Bord Bia, Enterprise Ireland and Bord lascaigh Mhara, is currently engaged in a co-ordinated effort to identify potential market opportunities for the full range of Irish food and beverages, prioritise market initiatives and deal with broader access issues.

Bord Bia published a strategy to boost food exports for the period 2009-11. This strategy comprises six key priorities to be addressed, including enhancing the industry's position on its home market to capitalise on the potential for growth and expansion of exports, with a particular emphasis on the eurozone markets. In delivery of this strategy, Bord Bia has implemented a comprehensive set of promotional programmes and services which have been developed in consultation with industry, bearing in mind the impact of the sterling differential on competitiveness.

Senator O'Malley referred to forestry, for which I have special responsibility. Members will be aware that the renewed programme for Government commits to a review of forestry policy to take account of its critical role in respect of climate change, its importance to construction, bio-energy, biodiversity and its potential to deliver long-term employment in other downstream industries, including eco-tourism, furniture and crafts etc. Following this review, which is under way, the current range of supports will be overhauled to facilitate the attainment of an afforestation programme of 10,000 hectares per year. Such a programme will yield significant economic benefits and will contribute to meeting our climate change commitments. In the past 30 years, the level of afforestation in this country has increased from 1% to 10%. That is a major improvement. Members will be aware that this is a long-term project because what is planted today may not mature for 20 or 25 years. I welcome the major commitment that has been made in respect of forestry in the past 30 years. The initiatives to which I refer, coupled with a proactive policy on my part and that of the Department in respect of evolving market situations, will help to position and consolidate the Irish agrifood and forestry sectors in the home and global market.

Senator Norris referred a meeting with representatives of Safe Food Ireland last week. As Minister of State with responsibility for fisheries, I am obviously trying to promote increased consumption of fish. We hope to continue to make progress in this regard. I spoke with Martin Shanahan, host of the television programme "Martin's Mad About Fish", who is doing a fantastic job in this regard. He informed me about the level of contact he has had from fishmongers throughout the country whose business has already increased as a result of his programme. We will continue to promote the consumption of fish, particularly those caught in Irish waters.

As the Minister stated, the Common Agricultural Policy will provide the main policy framework for development of the primary agriculture and agrifood industries in Ireland and the EU to 2020 and beyond and it is of the utmost importance that it should continue to underpin the development of a competitive and vibrant agricultural sector. Ireland's goal in the upcoming negotiations is for a Common Agricultural Policy that is robust and properly funded and that will be based on the twin goals of increased competitiveness and sustainability. Senators Prendergast, Quinn and O'Reilly referred to the need to foster innovation and quality and we will certainly take their comments on board.

Full decoupling of payments from production has been a success for Ireland and we should continue with this approach. We favour the two-pillar structure which is currently in place and which comprises income supports and market management measures in one pillar and more targeted mechanisms for rural development in the second pillar.

A number of Senators referred to the threat to our market as a result of cheaper imports from countries which do not adhere to the same standards of production as the EU. As the Minister indicated, we will be seeking to ensure that future EU agriculture policy will continue to recognise and reward the high standards that apply in respect of agricultural production in the EU and that full equivalence will apply with regard to imports.

Reference was also made to abattoirs and the high standards that apply. A number of Senators referred to the strict nature of domestic legislation in this regard. I accept that very strict rules apply. However, I consider this to be a virtue, particularly as it has resulted in high standards being adopted and led to Ireland being in a position to market meat produced here throughout the world. In addition, it has been able to establish a presence in high-value, well-paying international markets.

A number of Senators also referred to the need to exploit the potential offered by farmers markets. I fully agree with them in this regard. I have also raised the possibility of involving fish markets as part of this sector. However, it must be acknowledged that developing these markets will not, on its own, guarantee the future sustainability of Irish agriculture. We must also focus on business aspects, export potential and our ability to develop niche and high-value markets in Ireland and abroad.

The structure of the new CAP must recognise that the core function of the single payment is the support of farm income. I am of the firm belief that income support in the form of the single payment will underpin farming activity and the security of food supplies and protect the family farm as the platform for the production of public goods. However, there must be some recognition and acknowledgement of the differences between member states with regard to costs of living, comparator incomes etc.

Senator Burke and others referred to market support. We need to retain the market management mechanisms that are already in place and be prepared to have recourse to them as necessary. My view is that they are currently at a safety-net level and must be maintained as part of the future CAP.

Flexibility will be required in the operation of these mechanisms. Moreover, to deal with increased volatility in the markets and provide an additional safety net for our farmers, additional measures will be required to counterbalance severe price fluctuations. There is a good measure of support for these views within the Agriculture and Fisheries Council.

There will be a lot of argument in the forthcoming negotiations about the payment models to be used for the single payment system. Members are aware of Ireland's strong views in this regard. However, before reaching that point, there will be difficult discussions on the future EU budget and the amount of money that will be made available to agriculture. There is no doubt but that there will be great pressure for reduced funding for the CAP. In that context, Senator Bradford mentioned the good value for money one gets from the CAP and both he and Senator O'Brien spoke about its original principles, as enshrined in the Treaty of Rome. It should be remembered that the recently ratified Lisbon treaty reaffirms the principles of the CAP as enshrined in the Treaty of Rome, namely, to ensure the rational development of agricultural production, to ensure a fair standard of living for the agricultural community, to stabilise markets, to assure the availability of supplies and to ensure supplies reach consumers at reasonable prices. In the forthcoming negotiations I will again make this point.

As Members have referred to the wearing of the green jersey, I will recount my experience with regard to the Common Fisheries Policy. I recently briefed the MEPs who also are donning the green jersey on this aspect of the negotiations and would like to think this will also be the case with regard to the CAP negotiations.

In brief, in the negotiations to come we intend to defend robustly Irish agriculture and insist on a future Common Agricultural Policy that will be true to its original aims and provide a platform for a modern, competitive and sustainable Irish agriculture sector.