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Dáil
‹ Ceisteanna — Questions. Oral Answers. - Meat Industry Project.

Cattle supply and project viability

Summary

Deputies pressed the Minister on whether the project depended on increased cattle supplies and would add slaughtering capacity. He described it primarily as an investment in technology and value-added processing, said any extra slaughtering would depend on additional cattle, and cited efforts to expand the beef herd; questions about funding production and project procedures also arose.

John Bruton Mr. J. Bruton Fine Gael

Will the Minister state if the fact that grant-aid is linked to adequate supply, as he indicated in his reply, means that if there is not an adequate supply of cattle the package will not go ahead? Is the Minister in a position to confirm that the package may not proceed if adequate supplies are not available? Will the Minister indicate his answer to Question No. 57 which seeks information on the present slaughtering capacity of each meat processing plant and the slaughtering capacity that will be obtained after the full implementation of this project? I do not think the Minister answered that question. Will the Minister indicate if the project, if fully implemented, will involve extra slaughtering capacity? If so is the Minister satisfied that in the event that there is not an increase in supply that the extra slaughtering capacity involved in the project will not have the effect of prejudicing employment in other plants?

Comment on this
Seán Treacy An Ceann Comhairle Independent

I should like to dissuade the Deputy from putting a large number of supplementaries in omnibus form?

Comment on this
John Bruton Mr. J. Bruton Fine Gael

As it is the intention of the Chair to operate a rotation system among all the questioners I thought it would be better to get all my supplementaries in now.

Comment on this
Seán Treacy An Ceann Comhairle Independent

That is all the more reason why the Chair would like brevity.

Comment on this
John Bruton Mr. J. Bruton Fine Gael

Will the Minister state what will happen to the project if FEOGA is not available? Will it fall due to a lack of finance or is there a possibility that the State might be asked at that stage to provide more money? Will the Minister say how the Department of Finance were expected to examine the details of the project in between a meeting of the IDA authority on 12 June, over the week-end, and a Government meeting on the following Tuesday after one working day?

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

I should like to emphasise that the main thrust of the project is greatly enhanced added value and not any increase in livestock throughput. This project can operate on the basis of the company's present kill which is 40 per cent of total slaughterings and even after implementation of the project there will be plenty of room for competitive processing. The three new slaughtering processing facilities will have an additional planned throughput and already the expansion of the beef cow numbers is the subject of a promotional campaign launched by ACOT. That body are bullish about the numbers as a result of their campaign. The reduction in interest rates will also improve the climate for producers and processers but if a shortfall occurs the IDA have the right to review those elements of support which might be linked to additional cattle throughput.

Comment on this
John Bruton Mr. J. Bruton Fine Gael

It is all conditional?

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

Yes, it is conditional.

Comment on this
John Bruton Mr. J. Bruton Fine Gael

What additional throughput is involved?

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

I am anxious to answer the questions as fully as possible. The Deputy questioned me about procedures and I should like to assure the House that all normal and correct procedures were followed in the submission and the examination by the IDA of the proposal and in the ultimate recommendation for approval by the Authority. This proposal was under discussion for a number of months and a formal application was submitted on 9 April. The Authority, and the board of the IDA, were made aware of the project during those months before the board recommended approval on 10 June. The Authority approved it on 12 June. In the last few weeks, because of the scale of the project, there was frequent consultation between Government Departments. That consultation made it possible for the Government to give a quick response to the recommendation of approval given by the IDA.

Comment on this
John Bruton Mr. J. Bruton Fine Gael

How much additional slaughtering capacity is involved?

Comment on this
Seán Treacy An Ceann Comhairle Independent

I am calling Deputy Jim O'Keeffe.

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

This project can stand on its own.

Comment on this
John Bruton Mr. J. Bruton Fine Gael

How much additional slaughtering capacity is involved?

Comment on this
Jim O'Keeffe Mr. J. O'Keeffe Fine Gael

Will the Minister of State confirm that the existing slaughtering capacity can cater for a throughput of 65,000 head per week, a figure that has never been exceeded? Will the Minister agree that the maximum throughput per week has never gone beyond 63,000 head and is usually a lot less? Second, has the Minister given any consideration to a provision of funds to ensure an adequate and possibly an increased supply of raw material in the light of the major investment of national funds now proposed for the processing end?

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

The main thrust of this project and programme is that this is an investment in new technology rather than an investment in bricks and mortar. It is not an investment to increase slaughtering capacity. What we want is more processing and to create more jobs at home. Last year we exported 322,000 head of cattle live and I would hope that by the end of this programme we would substantially reduce that number. Additionally we have too great a dependence on intervention and third countries markets, both of which are coming under increasing pressure. Too high a percentage of the meat exported is in carcase form and in many instances the additional processing is done outside the country. At the end of this programme we should be creating all that added value and additional jobs in Ireland.

Comment on this
Jim O'Keeffe Mr. J. O'Keeffe Fine Gael

While I am in favour of investment in additional added value, the point I was raising dealt with additional slaughtering facilities since the existing maximum facility of 65,000 has never been exceeded. There are four new operations involved in this proposal. What will be their effect on slaughtering capacity? I am interesting in getting a true read out of the impact of this investment in relation to slaughtering capacity.

Secondly, what were the Government's intentions in the light of this major investment in relation to the production end? I would agree with the Minister on the question of trying to divert live exports into our meat factories, but that will not provide the answer. There is need for investment in beef cows and there seems to be no intention on the part of the Government to make an investment at that end——

Comment on this
Seán Treacy An Ceann Comhairle Independent

May I appeal for brevity?

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

On production and increasing the beef herd, as I have said already, it is a major part of ACOT's programme to increase the beef herd. They have communicated with me to the effect that there will be a 12 per cent increase this year in the beef herd. Additionally, with reducing interest rates, it will create a better employment environment for the farming community to expand the beef herd.

Comment on this
Jim O'Keeffe Mr. J. O'Keeffe Fine Gael

No funds?

Comment on this
John Bruton Mr. J. Bruton Fine Gael

Does the Minister know how much money there is in cattle production?

Comment on this

The Minister does not have 1,000 acres of winter grass.

Comment on this
John Bruton Mr. J. Bruton Fine Gael

The only Deputy I know who had that was on the other side of the House.

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

The Minister, Deputy O'Kennedy, has already had consultations with the banking groups——

Comment on this
Jim O'Keeffe Mr. J. O'Keeffe Fine Gael

Is there any State funding proposed to increase the number of available heads of beef?

Comment on this
Joe Walsh Mr. J. Walsh Fianna Fáil

As I said, we are not so much throwing money at the problem but creating a better environment——

Comment on this