Richard Bruton (Dublin North Central, Fine Gael)
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Question 95: To ask the Minister for Agriculture and Food her views on whether the removal of the current pre-payment procedure for export refunds at EU level is the first step to the complete abolition of export refunds; and if she will make a statement on the matter. [12017/06]

Enda Kenny (Mayo, Fine Gael)
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Question 129: To ask the Minister for Agriculture and Food the impact which the abolition of pre-financing of export refunds would have on the Irish food industry; and if she will make a statement on the matter. [12061/06]

Mary Coughlan (Donegal South West, Fianna Fail)
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I propose to take Questions Nos. 95 and 129 together.

Irish beef exports in 2005 stood at 487,000 tonnes. All of these exports went to the UK and continental Europe except for 35,000 tonnes that went to third countries, mainly Russia. While the beef industry has become in recent years less reliant on third countries these markets are important for specific cuts at particular times of the year. Third country beef exports attract export refunds.

At the Council of Agriculture Ministers on 20 March Commissioner Fischer Boel announced her intention of abolishing pre-financing of export refunds on the basis of criticisms levelled at the system in a 2003 report of the Court of Auditors that controls were complex and not evenly applied across member states. The pre-financing regime allows for payment of refunds at the time the beef is put under customs control and for the meat to remain in storage for up to four months. The regime is of benefit to exporters in that it assists them with cash flow but also provides time for the exporter to build up an exportable quantity of stock and to find a suitable market.

At the Council of Ministers I strongly opposed the removal of pre-financing arguing that its abolition was not justified. Pre-financing is being used currently by most of our exporters of beef to third countries and is an important part of their operation. The system was improved and streamlined in 2003 and the controls are now working well.

An internal impact study by the Commission shows that the main advantage of the scheme was in the administration of beef exports rather the financial element. The Commission propose new beef control measures to replace the present scheme and I and my Department will examine the proposals to ensure as far as possible that whatever is put in place by the Commission to replace the existing system best suits the needs of the Irish beef sector. This proposal on pre-financing of export refunds does not have any implications for the operation of the export refund regime generally.