(Limerick West) asked the Minister for Agriculture the plans, if any, he has to consolidate the dairying industry.

5.

(Limerick West) asked the Minister for Agriculture if he is satisfied with the workings of the Irish dairy co-operatives; and if he will make a statement on the matter.

I propose to take Questions Nos. 4 and 5 together.

The dairying industry has achieved considerable progress as regards rationalisation and modernisation. However, there is room for further improvement, particularly as regards product diversification, development of new markets and rationalisation of milk assembly. I will continue to encourage and support efforts by the industry to this end and the assistance of the State agencies concerned is also available.

The high priority given by the Government to the strengthening of the food processing sector generally, is clearly indicated in both the national plan, Building on Reality, 1985-1987, and in the preparation of a number of sectoral studies, including one for dairying, the objective of which is to identify how efficiency, returns to producers and employment can be maximised.

(Limerick West): Would the Minister see a function for the ICOS in the consolidation of the dairying industry.

I certainly do see a very major place for the ICOS in these developments. I have clearly stated that at times. I am in close contact with them on that.

(Limerick West): Would the Minister consider the strengthening of the role of the ICOS by giving them statutory functions?

That has not arisen. I have not had any request to that effect. Any request which I receive from such a responsible body would be given every consideration.

(Limerick West): Is the Minister concerned, or indeed alarmed, at the situation prevailing in some of the co-operatives in some of the Munster counties? Does he see greater scope for rationalisation among those dairy co-operatives in order to further consolidate our dairying industry?

I am concerned. I would hope that things will work out in a satisfactory manner. Might I point out that there has been a great deal of rationalisation in recent years. Between 1973 and 1983 the number of co-operatives was rationalised to the extent that they decreased from 71 to 48.

(Limerick West): But could the Minister foresee further rationalisation?

There may be a demand for further rationalisation where very minor, smaller co-operatives are concerned.

As the Minister has said, the really bright spot in the economy over the years has been the dairy industry, aided by the present development of their value-added products. Would he not agree that there is a very serious situation in that empire builders of co-operatives can and problably will wreck the dairy industry unless somebody steps in? The Minister said earlier that he would not tell us his strategy concerning the EC, but would he use his quiet diplomacy to ensure that those cowboys and empire builders do not wreck the dairy industry, as looks likely at present judging by the manner in which some of the co-operatives are operating?

We all share the Deputy's concern. We would hate to see any venture suffering as the result of, as the Deputy calls it, empire building.

The last supplementary question.

(Limerick West): Would the Minister accept the suggestion that he might, through his diplomacy, negotiate a softening approach with regard to the so-called wars which are taking place?

I have indicated my views previously to the people concerned. I am glad to see the recognition by Deputy Noonan of my diplomacy.

(Limerick West): The Minister is adept at that.

I am allowing Deputy Noel Treacy a short question.

Arising out of the Minister's initial reply, in which he said that rationalisation of milk assembly was one of the objectives that he would like to see implemented, can he give us any indication of what recommendations he can give to the co-operatives who seem to be putting over-emphasis on competition among farmers for milk? Would he agree that in the long term it will be the farmerproducer-supplier who will be the victim of the so-called milk war and over-emphasis on competition?

That was a general question. It is a matter of debate between certain co-operatives involved in certain disputes, if one can call them that, at the moment. I can only repeat what I said previously, that I am very concerned about the situation, that it should not damage the co-operative movement in general.

Has the Minister any direction to give to these co-operatives?

The whole basis of our future prospects for the industry is founded on the meaning of the word "co-operative". I would hope that people would co-operate.