Bernard Durkan (Kildare North, Fine Gael)
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Question 381: To ask the Minister for Agriculture, Fisheries and Food her plans to ensure the future development of the agricultural industry with particular reference to the meat and dairy sectors; and if she will make a statement on the matter. [21915/07]

Mary Coughlan (Donegal South West, Fianna Fail)
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Ireland is a food trading country. The industry serves 80 million customers throughout Europe and the world. This Government's vision for success is focused on the objective of ensuring that the Irish agri-food sector compares to the best in the EU and in the world in terms of knowledge base, competitiveness, innovation and marketing. My own approach and commitment to the future is based on the Agri Vision 2015 Action Plan, which I launched in 2005. This sets out the Government's vision for an agri-food sector that is competitive, consumer-focussed, which contributes to a vibrant rural economy, society and environment, and which also exploits opportunities in non-food areas.

The Action Plan sets out a wide range of actions that are required of all participants in the agriculture and food sector. These actions are needed to equip the sector to meet the challenges of a more competitive and liberalised market. Farmers, the processing industry, researchers, the advisory services, exporters and all those involved in the industry have a role to play in an integrated food chain if we are to achieve the vision that is set out. As commercial subsidies will play a much-reduced role in the future, success or failure will be determined primarily by the skills and energy of private business of all sizes and at all levels in the sector. Our vision for the future has been framed in the context of the Lisbon Agenda, which sets the overall EU policy framework for the economic and social regeneration of Europe if it is to remain a leading player in the global economy. The EU has committed itself to more growth and more jobs and, in particular, to investment in knowledge and innovation in unlocking business potential. This Government is convinced that the indigenous agriculture and food sector can make a significant contribution to the Lisbon process by retaining employment in rural areas in a modern efficient and competitive farming sector, in high-tech jobs in Research and Development and in the processing industry.

Meat Sector

To support the beef sector in responding to the very real challenges it faces on an ongoing basis in a very competitive environment, I have announced a number of policy initiatives and proposals. Amongst these is the Animal Welfare and Recording Scheme for Suckler Herds, aimed at assisting improvements in both quality and productivity, and thereby further underpinning competitiveness. Negotiations on finalising the scheme with the Commission, as required under EU law, are ongoing with a view to resolving outstanding issues as rapidly as possible. In addition, Bord Bia are intensifying their promotional efforts, particularly in our principal European markets. This will build on the already well-established marketing efforts, which are carried out on an ongoing basis by Bord Bia and the industry itself. In addition a Market Access Group has been established recently comprising representatives of my Department, An Bord Bia and the industry. Its main aim is to facilitate trade in Irish meat to non-EU markets. These initiatives are among a series of measures designed to assist and strengthen the beef sector and further position it to face the challenges of the future. Others include the Capital Investment Aid Scheme for the beef and sheepmeat sectors, which is directed towards improving efficiency and competitiveness in processing, expansion of Quality Assurance Schemes, and advances in Breed improvement programmes being progressed by ICBF.

Dairy Sector

To date in 2007, the dairy industry has experienced strong demand and prices for all dairy products and the outlook for the remainder of the year looks very positive. This has had a positive effect on producer prices, which have been increasing in recent months. Over the next years, intervention and market support measures will diminish in importance and the dairy industry will face internal and external price pressures. Capital investment and research and development in the industry are priorities in the Agri Vision 2015 Plan of Action. In this context, I launched a new dairy processing industry investment package in 2006. The package recognised the critical need for the State to engage with the processing sector in order to achieve the most favourable climate in which it can operate. The package will also assist the sector in terms of increasing scale and efficiency. In April 2007, a total of 19 capital investment projects were approved and awarded Government grant assistance of €114 million, which will generate an estimated capital spend of €286 million. The Dairy Processing Investment Fund will support capital investment related to the processing of dairy products, to underpin competitiveness and viability of the dairy industry in Ireland.

There is also a need for improved efficiency and long-term competitiveness at producer level. Reducing costs and increasing scale means getting more milk quota into the hands of active and committed producers at the lowest possible cost. I introduced a new Milk Quota Trading Scheme for the 2007/2008 quota year. I announced the 2008/09 scheme last week and the next quota trading exchange is due to run before the end of the year. The current Milk Quota regime was extended to 2014/15 as part of the Luxembourg Reform of the CAP in 2003. A Health Check review was agreed as part of this, but a Council Decision will be required for any proposed changes to the regime. The review will take place in 2008 and the key issue is the future of milk quotas. The Commission has already made it clear that it will be proposing the abolition of quotas from 2015, with a phasing out period before then, and will put forward a number of options in Spring 2008.