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04-02-1999 Speaking at the Irish Farmers Association AGM, in the Irish Farm Centre


President of the IFA Tom Parlon; Deputy President John Dillon; General Secretary Michael Berkery, Committee Members and ordinary Members ; distinguished guests.

It is a pleasure for me to be here today to address the annual general meeting of the IFA.

Social Partners

Your Association has, over the past 44 years, established itself as one of the leading forces in Irish society. There have been disagreements with the Government of the day from time to time. I am glad that, in these days of social partnership, we can say that the IFA and the Government have a relationship of mutual respect and trust. The IFA has played its full role, along with the other social partners and the Government, in creating a new, positive and effective set of relationships that lie at the very heart of our economic achievements of recent years. It is a model other countries now study as an example of how things should be done, as in the past we looked abroad to learn from those more successful than ourselves.

This is not to say that trenchant criticism is not sometimes forthcoming from your leaders, and the Government is well aware that the IFA is an organisation that will always speak clearly and fearlessly on behalf of its own members.

In recent times that has meant highlighting the problems faced by farmers on livestock markets, caused in particular by the BSE crisis and the collapse of the Russian market, and the difficulties that have arisen in many parts of the country due to poor weather conditions.

Your organisation has also fully grasped the importance of the European and international dimension that is now so important in agriculture policy, and has fully engaged with this process in a sophisticated and effective manner.

Farming will always matter politically in this country. While national prosperity is no longer solely dependent on it, the problems of farming will always be of great concern to me and all my colleagues in Government.

Farm Income

Irish farming is right now going through a very difficult phase. But the challenges are not just temporary and cyclical. Farming is also undergoing structural change. The current difficulties of Irish farmers are made all the more acute by the contrast with the success of our economy generally, and it is possible that this could cause some resentment. However, agriculture remains a major and vital part of the Irish economy and Irish society. I am sure that you will accept that the sector you represent has benefited greatly from the stable and sound economic environment we have created in national partnership, which has resulted in lower taxes and lower interest rates.

The Government is, of course, keenly aware of the income problems faced by farmers. Some recent figures from Eurostat have underlined that farm incomes across Europe declined last year, including in Ireland.

This contrasts with the overall progress made in the 1990s as a whole, when average farm incomes in Ireland grew faster in real terms, than in 12 of the 14 other EU countries. During the current difficulties, my colleague the Minister for Agriculture and Food Mr. Joe Walsh, T.D., has worked extremely hard and effectively, to ensure that everything possible is being done to help support farm incomes:

· a range of changes in EU market support arrangements have been    negotiated,

· direct payments to farmers, which amounted to over £1 billion in 1998, were speeded up and special advances provided, and

· a fodder package was introduced before Christmas to help those worst affected by the weather.

Farm Assist Scheme

This year, as you know, will see the introduction of a revamped scheme to support low income farmers. I regard the Farm Assist Scheme as a very important innovation, and a clear expression of my Government's commitment to practical action on poverty, whether it arises in urban or rural areas. As our economy improves, and we see more young people than ever before going into well paid jobs, we must not ignore our responsibilities to those who are left behind. This is a core part of Government policy, not just in agriculture but right across the social spectrum.

The Minister for Social, Community and Family Affairs, Dermot Ahern, T.D., yesterday secured Government approval to bring in the new Farm Assist Scheme with effect from April, with an additional £10 million for the new scheme in 1999, bringing the total to £43 million in a full year.

This will benefit the existing 6,600 on the Smallholders Scheme, and a further 6,800 Low Income farmers. Farm families with or without children, as well as single farmers are all eligible.

Further Fodder Scheme

I know that more remains to be done. In particular, farmers in some areas are facing enormous difficulties due to a shortage of fodder, arising from the bad weather last year. The Government has therefore decided that a further £20 million scheme should be introduced to help farmers with fodder problems in the worst affected areas. As you know already the Minister for Agriculture and Food Mr. Joe Walsh, T.D. announced a £70 million package yesterday, comprising that extra £20 million for fodder, and the bringing forward of £30 million under the Suckler Cow Scheme and £20 million under the Rural Environment Protection Scheme (REPS).

But we must also ensure that the aid gets out quickly to those whose needs are immediate, and that means keeping the scheme simple and straightforward.

The Department of Agriculture and Food deserves great credit for the efficiency with which it operates, and I believe that it is also recognised that its performance in delivering a record level of direct payments in 1998 was extremely good. I know that your organisation has a good and effective working relationship with the Department, in working towards a common goal of achieving what is best for Irish agriculture.

I am aware that there is a strong opinion, which to some extent I would share myself, whereby emergency aid could be more closely targeted, and therefore more generous to the farmer in real need, and still be delivered speedily, without being open to significant abuse or accusations or partiality. If a better or speedier system of doing that can be devised and agreed with the farm organisations and Teagasc, the Government will be very happy to consider it.

Agenda 2000

In looking forward over the next few years, the issue that dominates the horizon is, of course, the Agenda 2000 negotiations. I am not going to repeat what you have heard before, except to say that the Irish Government remains resolute in its opposition to the Commission's proposals. The Minister for Agriculture and Food, Joe Walsh, and his officials have pulled no punches in expressing Ireland's position.

The negotiations are now in a particularly intense phase with a High Level Group of officials meeting every week, to give a greater focus to the negotiations. Decisions which could be made within the next month, will set the framework which will shape the direction of farming into the next millennium, and which will influence the livelihood of Irish farming families. I am very conscious of the human aspect of the negotiations.

We are not just negotiating for an economic sector; we are negotiating for the incomes of Irish farm families. And we are determined to defend the right of Irish farmers to a respectable standard of living. At meetings of EU Prime Ministers, I have made it clear that the Irish Government is totally behind Joe Walsh in the case he is making on behalf of farming families.

I have taken a strong personal interest in the negotiations, and I chair a committee of top officials involved in the negotiations. I am also visiting most European capitals in advance of the Summits. I will be meeting Commissioner Fischler on Friday to further underline the crucial importance of these negotiations, not only to Irish agriculture, but to the Irish economy as a whole. Ireland's voice will be heard loud and clear in these discussions, I can guarantee you.

In particular, I believe co-financing of the CAP will be rejected. France, Spain and Ireland and I believe a majority of member States, are implacably opposed to that route, which would represent a major step towards the disintegration of the CAP. But other alternative forms of restraint on expenditure may not be particularly palatable either.

There are those who complain that the subsidies to farming have been made more explicit through the system of cheques in the post, as if this was somehow replacing a previous CAP régime of robust commercial self-sufficiency. The 1992 CAP reform was not an answer to all problems, as can be clearly seen today, but there have been good years as well as bad ones. In broad terms, without prejudice to disagreements in detail, the IFA's own thinking and proposals have much to commend them. We will try to achieve the best we can, in negotiation.

Structural Funds

The new round of Structural Funds is, of course, part of the Agenda 2000 package. These funds have been very important for Ireland in recent years. Over £1.5 billion has been spent on agriculture, food and rural development measures in the current round.

£25m was provided by the exchequer this year to fund the re-introduction of the farm pollution and dairy hygiene schemes, and £10 million over three years is being provided for a new installation aid scheme. This reflects the commitment of the Government to address both the investment needs of the industry, and the on-going need for structural change.

In relation to the new round of Structural Funds, it is vitally important that we ensure that whatever resources are available are concentrated where they can achieve the best returns. We should not simply continue doing what we have done before, without considering the new needs of the agriculture sector in the new millennium.

Future of Agriculture

And this is no idle pre-millennium sound bite. The fact is that the world in which Irish farming must operate is changing rapidly, and will continue to change over the coming years and unless we manage that change, we will be engulfed by it.

Agenda 2000, and the new round of world trade negotiations in the WTO, will move us firmly towards a more competitive world market. Clearly this offers both opportunities and threats to the industry.

In order to be able to face the challenges, and maximise the opportunities for exports and income growth, we need an agriculture sector that is highly competitive, tightly focused on consumer demands, and actively supported by high quality public services.

We must all take a long hard look at our respective roles in the sector, to see how we can contribute to improving our competitiveness. The next round of Structural Funds should then be focused on achieving real and demonstrable progress on the structural constraints faced by the industry. We must, for example, deal with the issue of the age profile of our farming population. We must also face up to the evolving new structures of Irish agriculture, including the much larger role played by part-time farmers and the potential that Information Technology offers to support farming incomes in future activity.

The role of agriculture in broad-based rural development, and its impact on the environment must also be addressed. That farming should be carried out in the manner that helps to maintain and improve the countryside is something we should support, and REPS-type schemes, which have been a great success generally speaking, will continue to have an important role to play. As will the increasing trend towards organic farming.

In all of this, the status quo is not an option. We must change to remain competitive. In fact to survive.

Recognising the challenges ahead for agriculture, the Government has decided to establish an Expert Group to look at the future of the sector.

The group will be established once the Agenda 2000 decisions are made, and will be expected to provide a clearsighted analysis of the sector. Similar exercises have been carried out in the industrial sector to very good effect.

It will also take on board the conclusions of the White Paper on Rural Development, which will be published in the next few months, to ensure a consistent approach to all aspects of rural renewal.

Agriculture in the Economy

Agriculture and the food industry will continue to play a hugely important part in our economy. This is a point which I have stressed when talking to non- farming audiences. The agri-food sector accounts for around 12% of GDP, exports, and officially measured employment. But in fact these figures substantially understate the overall contribution of the industry. Detailed CSO figures show that 300,000 people work on farms, either full or part-time, and a recent study for the Department of Agriculture and Food shows that the sector accounts for one third of our net foreign earnings from trade. Irish food products are on sale and display in many places abroad, where they would not have been found 15 or 20 years ago. That gives us all a genuine sense of achievement.

I make these points here to assure you that I, and all my colleagues in Government, fully appreciate how important this industry is to the prosperity of us all.

We should face both current problems and future challenges with determination and confidence, and be willing to embrace change when it is required. I assure you that this Government will spare no effort to secure the brightest possible future for Irish farmers, and we will do so in full and active partnership with the IFA.