Minister for Agriculture, Food and the Marine
Introductory Speaking Points at the Joint Oireachtas Committee,
30 September 2015.
· I am very pleased to accept your invitation to the Committee hearing this morning. This is a valuable opportunity to review how we are progressing with the various challenges and opportunities presented across the various sectors in agriculture, food development, marine and forestry sectors and to talk about market prospects across these areas and new investment opportunities for the coming year.
· The agri-food sector continues to play a considerable role in our economic recovery. The sector remains Ireland’s largest indigenous industry and accounts for almost one in nine jobs, many in rural and coastal areas where few other employment opportunities exist.
· Earlier this year Bord Bia confirmed a fifth consecutive year of growth in agri-food exports. The value of Ireland’s food and drink exports grew by some 4% during 2014 and reached almost €10.5 billion, which is another all-time high. This is some €3.2 billion higher than in 2009, an increase of over 45%.
· In July the Taoiseach launched a very important plan for a new ten year strategy for the agri food sector, aptly named Food Wise 2025. Food Wise 2025 predicts that over the next decade Ireland can;
o increase the value of agri food exports by 85% to €19 billion,
o increase value added to the sector by 70% to €13 billion,
o increase the value of primary production by 65% to €10 billion.
· This should deliver a further 23,000 jobs in the agri food sector by 2025 and will present many challenges for us to face.
· In April this year the milk quota ended and opened up opportunities and sustainable growth for the dairy industry in the years ahead. Nationally, we can conservatively predict that the next five years of dairy expansion will deliver approximately 10,000 new jobs in rural Ireland. Ireland’s plan for a 50% increase in milk volume in five years is unmatched in the EU; other member states expect no more than 20% extra milk.
· Almost simultaneously with the ending of the quotas a number of factors including the Russian ban, reduced demand for dairy product and increased stocks and production in China have resulted in significant downward pressure on dairy prices. This is putting significant pressure on farmers. This is a global issue, as well as an Irish issue, which is not possible to address in isolation.
· I am engaging on a continuous basis with EU counterparts and the Commission to ensure that every possible measure is taken at EU level to mitigate the effects of the current situation.
· The key measure recently given effect by the Commission is the facilitation of advance payments of 70% under the direct payments scheme and 85% for rural development schemes before completion of controls. This will be of significant benefit in terms of easing the cash flow of farmers.
· Furthermore the EU Commission announced earlier this month that it is providing a €420 million direct aid package for European farmers. Ireland’s share of this fund will amount to nearly €14 million. Among other measures announced, the increase of more than 100% in the rate of private storage aid for skimmed milk powder is very significant.
· I can assure the members of this Committee that I will continue to work with industry, other member states and farm organisations to consider how we can refine and improve mechanisms to help farmers to cope with downward price cycles when they arise.
· Today’s meeting will allow us to look back over the year to date, look at the remainder of the year and, as we are now close to budget 2016, to let me hear from you what you consider to be the key priorities for investment and support for the Agri-food, forestry and marine sector in 2016.
· In the financial data we have supplied we have tried to tie the financials and the outputs together in the briefing and I am happy to elaborate on any elements that you wish to discuss.
· This year the Exchequer contribution to the Vote of my Department amounted to amount to €1,260 million; €1,044 million in current expenditure and €216 million capital expenditure. This represents an overall increase of €41million over last year’s figures and is the first time my Department’s budget has increased since 2009. Expenditure so far this year is in line with profiles and it is expected that this will continue over the remaining quarter.
· My overarching priority for 2015 has been to deliver the first part of the Government’s commitments to the farming and fishing sectors in the commencement of actions under the new rural development and seafood development programmes. These supports prioritise vulnerable sectors and support the incomes of family farms.
· Overall, I secured €439m for investment in the Rural Development Programme – up from €405m in 2014m. Schemes under the new RDP including GLAS, Beef Data and Genomics Scheme, TAMS II and Areas of Natural constraint are up and running and I am pleased that, despite an additional two weeks allowed for application, €114m of ANC payments issued to farmers last week.
· Next month will see payments under Agri-environmental schemes begin to issue. This year €155m worth of payments will issue to 17,000 REPS farmers, closing out that important scheme; 19,000 farmers under AEOS and to up to 26,000 farmers under the new GLAS - the Green Low-Carbon Agri-environment scheme. This scheme, when fully open, will support up to 50,000 farmers and require funding of €250 million, will build on the success of these earlier programmes and encourage farmers to farm in an environmentally manner.
· The total allocation for the various on-farm investment schemes planned under TAMS II is €395m over the course of the RDP programme. For 2015, I allocated €34m to grants under TAMS, which represents a 100% increase on the 2014 budget. This provides for final payments on TAMS 1, new schemes under TAMS II as well as a new Farm Safety Scheme. I recently extended the period for receipt of applications under TAMS 1 and the Farm Safety scheme by 2 weeks and I am pleased that this additional period of time allowed many farmers to submit applications for finished projects. Officials in my Department are working on those applications now with a view to processing payments for issue over the coming months.
· In August I announced the opening of a new TAMS II Scheme for Pig and Poultry investments and recently opened two more new TAMS II Schemes. One is the Animal Welfare, Safety and Nutrient Storage Scheme and the second one is the Low Emission Slurry Spreading Scheme – LESS. The benefits of the schemes range from the construction of new animal housing, the provision of nutrient storage facilities and the ever important safety elements to a more environmentally-friendly approach to the spreading of slurry, with knock-on benefits for Ireland’s ammonia and climate targets.
· As you know, 2014 was a year when tragedy struck too many Irish farm families. Conscious of the loss of life and injuries sustained on farms in recent years, and particularly during 2014, I opened the Farm Safety Scheme in October of last year. Following on from the demand of the Farm Safety Scheme which saw applications from over 6,000 farmers, I was pleased to be able to re launch the safety component of this new scheme - the Animal Welfare, Safety and Nutrient Storage Scheme. This will give all farmers an opportunity to assess what can be done on their farms to improve safety and save lives on Irish farms. I am determined to do everything possible to reduce these dreadful accidents on our farms.
· The Beef industry experienced a very difficult year in 2014 and I was conscious of the need to give particular priority to providing the kind of support that can contribute to restoring confidence to this sector. I was pleased that we were in a position to fund support measures worth in excess of €73 million in 2015.
· The cornerstone of this support package is a significant increase in the funding allocated to the new Beef Data and Genomics Programme from €23 million to €52 million. This 126% increase will place Ireland at the international forefront of genetic improvements in beef and will make an important contribution to improving the carbon efficiency of Irish production. Payments under this scheme will issue to participating farmers later this year.
· I also prioritised innovation, as part of a the smart agenda through a substantial fund for R&D and Training amounting to €28 million under the FIRM, Stimulus and Forestry funds and Teagasc training courses. A new call for research proposals will issue shortly.
· The allocation of almost €147m for Ireland under the new European Maritime and Fisheries Fund 2014-2020 is very significant for the sector. In aggregate terms, this represented a doubling of Ireland’s allocation of EU funds relative to our allocations under the former European Fisheries (EFF) and EU Financial instruments for sea fisheries control and data collection. The Department has prepared a new Operational Programme in consultation with the industry which has been submitted to for approval by the EU Commission.
· The new and substantially improved allocation of funds combined with over €90m of national co-funding will enable me to launch new schemes under the Seafood Development Programme aimed at driving investment in fisheries and seafood development to 2020 and securing the future of the marine sector.
· Taking account of the fact that the Irish bloodstock industry is of enormous economic benefit to this country, I increased state support to the Horse and Greyhound industry by €14 million to €68 million. It has been estimated, that the industry provides in excess of 14,000 jobs, approximately €1.1bn in economic output and is responsible for exports worth in excess of €200m. The increase in State support to both industries is in recognition of the significant shortfall in funding going into the horse and greyhound sectors in recent years as a result of the downturn in the economy.
· Budget 2015 also saw a suite of taxation measures designed to support modernisation, restructuring and promote growth and expansion.
· Overall 2015 has been a challenging year. We have had to develop and launch the new Basic Payment Scheme which will see some €1.2bn of funding issue to Irish farmers. 70% of this will issue in mid October recognising difficulties farmers are currently experience. We have also had to develop and open new schemes under the Rural Development Programme. Opportunities following the abolition of quotas were undermined by the downturn in world demand for dairy and the Russian trade embargo and required a swift EU response in the form of supports. I remain confident in the future for Dairy in Ireland over the medium to long term however.
· This Government remain committed to both the agriculture and marine sectors and I am determined through the Departments initiatives, schemes and programmes to continue to support and develop these important pillars of Irish society and the Irish economy.