Northern Ireland Assembly Flax Flower Logo

Northern Ireland Assembly

Tuesday 9 October 2001


North/South Ministerial Council: InterTradeIreland

Social Security Fraud Bill: Further Consideration Stage

Committee Business: Assembly Standing Orders 

Livestock and Meat Commission

Safeguarding Industries in Northern Ireland


The Assembly met at 10.30 am (Mr Speaker in the Chair).

Members observed two minutes’ silence.


North/South Ministerial Council: InterTradeIreland

Mr Speaker:

I have received notice from the Minister of Enterprise, Trade and Investment that he wishes to make a statement on the North/South Ministerial Council meeting, in its trade and business sectoral format, held on 28 September 2001 in Newry.

The Minister of Enterprise, Trade and Investment (Sir Reg Empey):

The fifth meeting of the North/South Ministerial Council in its trade and business development sectoral format took place at the InterTradeIreland offices in Newry on Friday 28 September 2001. Dr Farren and I represented the Northern Ireland Administration. The Irish Government was represented by Ms Mary Harney TD, Tánaiste and Minister for Enterprise, Trade and Employment. This report has been approved by Dr Farren and is made on his behalf also.

The Council received a verbal report form the InterTradeIreland chairperson, Dr Martin Naughton, and chief executive, Mr Liam Nellis, on recent progress by the body. This included progress on the establishment of the body and progress of the major programmes launched within the 2001 operating plan, which had been approved by the Council. Key areas discussed included the equity network, which focuses on increasing awareness of the potential for, and availability of, equity funding; and the knowledge transfer initiative with its two cross-border projects - Fusion and Focus - which bring together, on a cross-border basis, companies, graduates and institutions of third level education.

The Council considered and approved InterTrade­Ireland’s corporate plan 2002-04. The plan has two main strategic goals. The first is to increase the quality and quantity of knowledge concerning cross-border trade, and the second is to ensure that this improved knowledge and information is made available to those involved in decision making on cross-border trade.

Working with and through existing agencies, the body’s strategic goals will be translated into several activities, including the development of an all-island business model; the development of an electronic all-island business directory; a knowledge transfer initiative; and an equity awareness network.

The Council considered InterTradeIreland’s draft equality scheme, which had been revised following public con­sultation. The Council agreed that the draft scheme should be submitted to the Equality Commission for Northern Ireland for approval.

The Council accepted the resignation of two board members of Tourism Ireland Ltd, Mr John Dully, former chief executive of Bord Fáilte, and Mr David McAuley, former acting chief executive of the Northern Ireland Tourist Board. The Council appointed as their replacements Mr Niall Reddy, acting chief executive of Bord Fáilte, and Mr Alan Clarke, chief executive of the Northern Ireland Tourist Board.

The Deputy Chairperson of the Enterprise, Trade and Investment Committee (Mr Neeson):

I thank the Minister for his concise report on the meeting, and I welcome the fact that InterTradeIreland has now developed a corporate plan for 2002-04. When will the full corporate plan be made available to the House? Can the Minister update the House on the work that is being carried out by Tourism Ireland Ltd? Is the Minister satisfied with the present staffing levels at the Belfast office of the Northern Ireland Tourist Board?

Sir Reg Empey:

In response to Mr Neeson’s final question, which is slightly off centre in the context of the report, the staffing situation at the Northern Ireland Tourist Board is not satisfactory. We recently appointed a chief executive, and advertisements will soon appear for several posts which have fallen vacant after people have moved on. It is to be hoped that a reasonable complement of staff will be restored shortly.

The Member will be aware that the staff members who deal with selective financial assistance are to be transferred to Invest Northern Ireland, and others will be transferred to Tourism Ireland Ltd, if they so wish. How­ever, several key vacancies have arisen recently; also, several key members of personnel are now to take maternity leave. Those factors combine to create shortages. The Department is in discussion with the Tourist Board, and we hope to put interim measures in place.

The corporate plan will be published in the next few weeks, and it will be available for inspection by Members and the public. Detailed operating plans will appear annually, and these will be linked closely to budgets.

Dr McDonnell:

I congratulate the Minister on his succinct, precise and informative statement and the sterling efforts he and Dr Farren have made in the North/ South Ministerial Council. In the light of the events of 11 September, the work of the Council becomes more and more vital. The statement shows the importance and the benefits of working together on a cross-border basis in the area of business development.

However, given the potential for economic downturn since 11 September, does the Minister agree that the work of InterTradeIreland is vital to the economy on both sides of the border? What short- to medium-term benefits does he foresee in that respect?

Sir Reg Empey:

The events of 11 September are having an impact across the board. We have not yet grasped the full implications of events, although later today the House will have an opportunity to debate some of those issues in broader terms.

In the short term, a number of key drivers are at play. The level of inward investment that we have become used to, particularly in the last financial year, is not going to be there. We must face the facts. A downturn was already under way, and that was accelerated by events in the United States. Therefore, we are going to be depending more and more on our own resources, and the key function of this body is to increase, among other things, the level of cross-border trade. It may well be that we will have to make up for the absence of inward invest­ment by trying to increase trade closer to home. That is one of the key objectives of InterTradeIreland.

It is also essential that we measure what cross-border trade amounts to. It may surprise the House to know that this is proving difficult. The statistics are confusing, and a study and work with the authorities are under way to try to assess the current level accurately.

Dr McDonnell:

Is the Minister referring to legitimate or illegitimate trade?

Sir Reg Empey:

We are sticking to legitimate trade. It is difficult to measure. We want to assess that accurately so we can use it as a benchmark against which we can measure the progress and success of the body.

Much work is undoubtedly being undertaken. There is an attempt to alert people to the potential market on their doorsteps. The lack of knowledge and contact and the opportunities missed are staggering. People may be buying materials, goods and services from thousands of miles away when they could be buying them practically next door. The gaps in people’s knowledge are amazing in that respect. This organisation will be redressing that in the next few years.

Rev Dr Ian Paisley:

Can the Minister assure the House that in relation to Tourism Ireland Ltd, the fair employ­ment legislation of this country - as part of the United Kingdom - is being strictly adhered to? Will he now publish the perceived religion of the employees of Tourism Ireland Ltd?

Sir Reg Empey:

My report today, as the Member knows, is on InterTradeIreland, but any body or organisation working and located in Northern Ireland is subject to the laws of this part of the United Kingdom, and that includes all the employment law. Tourism Ireland Ltd will be obliged to file its returns on the religious make-up of its workforce with the necessary authorities just as any other employer will. This statutory obligation also applies to the implementation bodies that are located in Northern Ireland; it is their statutory duty to file such returns.

The first returns from Tourism Ireland Ltd will be due early next year. The company has not yet filed a return because it has not had staff for more than a few months. All the people who have been working for that body have been secondees from the Northern Ireland Civil Service or the Irish Civil Service. However, the recruitment process is now well advanced, and it will therefore have its own complement of staff from now on. It has not yet reached its establishment level. Further recruitment will also be undertaken. All the returns that it makes will be freely available to Members, so that people can see the breakdown of the staff in those bodies.

10.45 am

Ms Morrice:

One of the most important issues affecting cross-border trade is the launch, in less than three months’ time, of the single European currency. To my surprise, I find that it is not on any agenda or given any priority at the NSMC meetings or by InterTradeIreland. Is the Minister playing King Canute with the single European currency and trying to stop the tide? How will he prepare businesses in Northern Ireland, especially those on the border, for that inevitability?

Sir Reg Empey:

The launch of the euro in January will not be confined to InterTradeIreland or any cross- border body; it will apply to all businesses. Whether we are in the European single currency zone or not, the euro will be available as legal tender. Some businesses already trade in euros, and some are already invoicing and paying bills in euros. A forum is working to inform businesses about the euro; seminars have been held, and outreach work designed to upgrade the knowledge of our business community has been done. That work is not confined to this implementation body.

InterTradeIreland acts as a catalyst in both jurisdictions. It does not have a specific remit, but it points out the fact that the Republic and many other parts of Europe are in the euro zone. We have discussed the matter, but the body can take no decisions about the European single currency; that is a matter for the United Kingdom Government and the Chancellor. The role of our Depart­ment is to ensure that all businesses are prepared, and that work is well advanced. A group has been working on that for over two years, and, over the next few months, there will be a series of seminars for businesses. There is also a large amount of literature available, and, when the time comes, businesses will be as well prepared as possible to meet the challenge.

Mrs Carson:

The statement says:

"Working with, and through, existing agencies, the Body’s strategic goals will be translated into a number of activities".

What are those agencies, and how will the work proceed? How many of the agencies are based in Northern Ireland, and how many are based in the Republic?

Sir Reg Empey:

The reference is to agencies such as IDB, LEDU, the Industrial Research and Technology Unit (IRTU) and their equivalents in the Republic - Enterprise Ireland and the Industrial Development Agency (IDA). Those are the main agencies through which the body will work. The cross-border body is not designed to replace or supplant the work of any of those agencies in either jurisdiction; its functions are to raise awareness and to see that every step that can be taken to increase and improve cross-border trade and business is taken. InterTradeIreland does not have the capacity to deliver the services offered by the delegated statutory agencies in each jurisdiction. It is important that that fact be known.

There is growing co-operation between the existing agencies and InterTradeIreland. InterTrade Ireland has facilitated meetings in various places, and it also works with chambers of commerce and other organisations such as the Confederation of British Industry (CBI), the Irish Business and Employers Confederation (IBEC), and the Institute of Directors (IoD). It mounts roadshows to raise awareness and also works through educational institutions. One of the key thrusts of the corporate plan will be the improvement of knowledge. That can be realised only by working through the existing structures in each jurisdiction; it is not intended that they be supplanted or replaced.

Mrs Courtney:

The Minister has spoken highly of the corporate plan presented to the North/South Ministerial Council by the board of InterTradeIreland. He has focused on the two cross-border projects, Focus and Fusion, which bring together companies, graduates and third-level education institutions. Will the Minister tell the House how recruitment to those programmes will take place, who will be involved and how Ministers from the Northern Ireland Executive and the Irish Government will review and measure the delivery of the plan?

Sir Reg Empey:

When the corporate plan is published, the Member will be able to see that a number of agenda items were set out for InterTradeIreland in December 1998. One or two of those proved impossible to advance and were discarded. What we are now seeing is the out­working of some of those agenda items. The knowledge transfer initiative brings companies, graduates and third- level institutions together on a cross-border basis. At a meeting of the body in February, Dr Farren and I pushed to increase the number of people who were eligible to participate. That was agreed, and the number of participants was doubled.

We have focused on giving companies access to the technical skills that they need to develop their products and markets. In other words, we find a company in one jurisdiction that has a perceived need and in another jurisdiction we find a potential graduate, or someone with the required skills, to be seconded to meet that need. The response has been extremely good, and a large number of people with first- or second-class degrees have been identified. We have far more applicants than we have places available. The issue is one of transferring skills to a company that might not otherwise be able to get them.

The Focus project provides a business with a graduate to assist with sales and marketing initiatives. That is one of the weaknesses of businesses throughout this island and further afield. The Fusion project matches a business with a third-level education institution and a graduate to help with the development of new products and processes. We are very encouraged by the early responses we have received to both projects.

Mr Poots:

The Minister’s statement declares that through work with, and through, existing agencies, the body’s strategic goals will be translated into a number of activities including the development of an all-island, or all-Ireland, business model and an electronic all-island, or all-Ireland, business directory.

Does the Minister accept that he is wholly imple­menting the harmonisation aspects envisaged in the framework document?

Sir Reg Empey:

If people feel so insecure in the Europe in which we are now working that we cannot do business with a neighbour because to do so would imply a constitutional weakness or impropriety, that is unfortunate. The objective is to increase business, increase sales and increase efficiency through business.

There is no reason to prevent consistent promotion of the East/West agenda. If someone from the Republic is involved in that initiative, does it mean that he is revisiting the old days of the Union? People have to understand that our focus is on economics, business and trade. Currently, some 146 companies from the Republic of Ireland are among the largest investors in Northern Ireland, second only to investment from the United States of America.

You cannot have your cake and eat it. If you want to do business, then you do business with whomever you can trade with. This is nothing whatsoever to do with the framework document. I personally rejected that document, and it did not include my views or represent me. If people take the opposite view and say "Let us not do any of this", they are taking the easy way out. We could easily neglect the development of trade and linkages. We could adopt that attitude; I had hoped, however, that "head-in-the-sand" economics was now behind us.

We are part of the European Union, whose functions include trans-European networks and a degree of economic integration within the European Union. We could always pull out of that as well and sit here in splendid isolation and purity - but we would have no trade.

Sir John Gorman:

I was pleased to hear the Minister mention the Institute of Directors. While he was chairman of the Ulster Bank, the chairman of the institute, Sir George Quigley, also chaired an important body involving businesses from both sides of the border which wrote the Quigley report on cross-border trade. It provided a very good guide to the way in which the sort of joint activity mentioned by the Minister could be developed. It would be worthwhile for the Minister to obtain that report and to see how much of it is still relevant. What is relevant is that the membership of the IoD, from both sides of the border, comprises about 1,000 people, all of whom are directors, chairmen or managing directors of companies. There is a great deal of latent availability for cross-border trade within that context.

Sir Reg Empey:

Professional organisations do have contacts. The Confederation of British Industry (CBI) and the Irish Business and Employers Confederation (IBEC) have had contacts for years. The IoD has contacts with its equivalent. We are, of course, focusing here on one particular area of activity. We have to remember that these organisations have links. They are, generally speaking, GB-based bodies in the first place. They also have links throughout the European Union and beyond. They are all linked internationally. If the last few weeks have taught us anything, they should have taught us that we are part of the global economic structures. We are not isolated, and we must not be isolated. The last thing that we need at the moment is to go in that direction.

If we want success, all our key economic activity must be linked outside Northern Ireland. Our main focus - and one of the main policies of our economic agencies - is to encourage exports. If you go around the world saying "We want to sell you our products but we are not interested in you or your products" you will soon get short shrift. The professional and business bodies have grasped that simple fact. They have realised that the more effective we can make ourselves, and the more effective our neighbours are in any direction, the better will be the basis for trade and economic prosperity. That is particularly so in current circumstances, as foreign direct investment (FDI) is going to be in exceptionally short supply in the not too distant future. People should focus on that aspect. It is possible to grow, and increased trade is as good as inward investment. It secures jobs, and I am sure that that is the rationale for the involvement of organisations such as the IoD.

Mr O’Connor:

I welcome the Minister’s statement. Can he tell us what has been done throughout Northern Ireland to publicise the work of InterTradeIreland among small businesses that are not necessarily operating in conjunction with LEDU?

Does he agree that to create a prosperous society here, and for local businesses to be successful, we must expand upon the work of InterTradeIreland and establish an east/west link, a European link and a global link? Does he envisage any expansion of the plan to include other European trading partners?

11.00 am

Sir Reg Empey:

Those are sensible ideas. I agree that our objective should be to focus on increasing links, not only on this island and with the rest of the UK, but with the rest of the EU and further afield. Trade Inter­national Northern Ireland - the trading arm of the IDB - has received support from companies for missions overseas, which I will explain in more detail later.

InterTradeIreland held four roadshows that were well attended by members of the business community: I attended two of them. The purpose of the roadshows was to let the business community know of the organisation’s existence and potential. InterTradeIreland has also held themed events on e-commerce; it has a web site; it has communicated with all the major statutory organisations on both sides of the border; and it has sponsored several events, such as awards ceremonies. InterTradeIreland has also tried to establish itself by linking with chambers of commerce and several local authorities.

One must remember that it is only in the past few months that InterTradeIreland has had permanent staff. When it begins to publish its reports and deliver on the programmes that are now commencing, its work will be more widely known than it is at present.

Approximately two weeks ago, a substantial supplement to ‘The Irish Times’ focused on equity, and indicated the work that InterTradeIreland is doing in that area. The Member will find that supplement in the Library, and he will see how that organisation is doing its best to publicise its activities.

Mr Beggs:

The Minister mentioned the importance of sales and marketing to the Focus and Fusion schemes. Given the advent of the one-hour ferry crossing between Larne and Cairnryan, does the Minister accept that to increase trade with Scotland, the north of England and the rest of the UK will become more important to businesses in Northern Ireland in future?

Mr Speaker:

Order. I have listened to several questions, and I must say that Members are using the opportunity afforded by statements, and questions to them, to rove wide of the statements themselves. That is inappropriate. It seems to have come to the point where I will have to talk to the Business Committee because the matter of questions on statements is being abused by some Members.

It is up to the Minister whether he wishes to respond to Mr Beggs’s question. However, it has nothing to do with InterTradeIreland, which was the subject of the statement.

Rev Dr Ian Paisley:

On a point of order, Mr Speaker. I hope that you do not include my question, because that was relevant to the statement.

Mr Speaker:

Order. I did not mention any particular Member. If Members sense that what I said is relevant to them, that has nothing to do with me.

Rev Dr Ian Paisley:

I do not feel that it refers to me. I will continue to ask my questions.

Mr Speaker:

Order. I did not mention any particular Member. However, I caution on the general issue because I have listened carefully to all the questions - at least those that were questions, because not all of them were. I leave it to the Minister to decide whether to respond.

Sir Reg Empey:

In response to my Colleague, 37% of goods that we produce go to the rest of the United Kingdom. There is no doubt that that is our single largest market. There is scope for the British-Irish Council to take up that aspect of the work, and there is no reason why that should not happen.

The Member refers to the links between Northern Ireland and the rest of the UK. Ferry crossings are undoubtedly one of those key links. Activity by any of our statutory agencies that ignored that fact would indicate a failure by those organisations, because they would not have focused on their nearest and most significant market.


Social Security Fraud Bill: Further Consideration Stage

Clauses 1 to 18 ordered to stand part of the Bill.

Schedule agreed to.

Long title agreed to.

Mr Speaker:

That concludes the Further Consideration Stage of the Social Security Fraud Bill. The Bill stands referred to the Speaker.


Committee Business: Assembly Standing Orders

The Chairperson of the Committee on Procedures (Mr C Murphy):

I beg to move the following amendment: In Standing Order 52 delete all and insert


(1) Each Committee ("the parent Committee"), in the discharge of its functions, may establish sub-Committees.

(2) Unless with the approval of the Business Committee and the Assembly, a parent Committee shall establish no more than one sub-Committee to operate at any one time.

(3) A sub-Committee shall be appointed to consider specific, time-bounded matters within the terms of reference set by the parent Committee and shall:

(a) report only to that Committee; and

(b) stand dissolved on disposal of those matters.

(4) A sub-Committee shall not take any decision on behalf of the parent Committee.

(5) A parent Committee may appoint a member to be the Convenor of a sub-Committee.

(6) Each sub-Committee shall, in as far as it is practicable, reflect the party strengths in the Assembly.

(7) The quorum of a sub-Committee shall be determined by the parent Committee.

(8) The proceedings of a sub-Committee shall be such as the parent Committee shall determine."

(Mr Deputy Speaker [Mr McClelland] in the Chair).

Go raibh maith agat, a LeasCheann Comhairle. As part of the ongoing review of Standing Orders, the Committee on Procedures has reviewed the procedures for establishing Sub-Committees.

The Committee focused primarily on the purpose of Sub-Committees and the procedures by which they are established. In its consideration, the Committee sought and received the agreement of the Chairperson’s liaison group to propose a Standing Order. The Committee drew on the practice used in other parliamentary institutions.

The purpose of the motion is to clarify the existing Standing Order that deals with Sub-Committees, which is Standing Order 52. That facilitates the establishment of Sub-Committees and formed part of the original Standing Orders agreed by the Assembly on 9 March 1999. However, the Committee concluded that several important issues are not addressed in the Standing Order. There is no provision for setting a quorum; there is no provision for setting procedures under which a Sub- Committee will work; and no account is taken of the possibility that a Committee may wish to establish two or more Sub-Committees to operate concurrently.

The proposed amendment to the Standing Order is designed to take account of those omissions. Sub- Committees can be useful to enable Committees to make progress quickly and efficiently, especially when a Com­mittee is faced with a heavy work programme, or when there are other pressing engagements on Members’ time that could make it difficult for the Committee to operate effectively. I refer to recent difficulties faced by some Com­mittees during the recent Westminister election campaign.

Under Standing Order 52, a Committee of the Assembly currently has the right to establish a Sub-Committee, but it must first seek the approval of the Business Committee and, subsequently, that of the Assembly.

The Committee on Procedures considered that to meet that requirement was an unwieldy procedure. It concluded that the decision regarding the establishment of a Sub-Committee was one for the relevant Committee to make, and that the approval of the Business Committee and the Assembly was unnecessary.

The Committee on Procedures has therefore proposed that the Standing Order be amended and that the parent Committee be allowed to decide whether to create a Sub-Committee, without the prior approval of the Business Committee or the Assembly. However, to ensure that there is no abuse of the procedure, the Committee on Procedures has proposed that the new Standing Order state that Committees must seek the approval of the Business Committee and the Assembly if they wish to operate more than one Sub-Committee at any one time.

A further safeguard to the procedure, which is in addition to the current provisions of Standing Order 52, is that a Sub-Committee may be appointed only to consider specific time-bounded matters and must be dissolved upon disposal of those matters. That would ensure that Committees do not set up Standing Sub-Committees, the danger being that the importance of the Sub-Committee could, in time, outweigh that of the parent Committee.

Several other safeguards have been incorporated into the new Standing Order. It has been made explicit that a Sub-Committee may not take a decision on behalf of the Committee. That is an important stipulation, as it ensures that the Sub-Committee cannot operate independently from the parent Committee.

The new Standing Order also proposes that a Sub- Committee’s quorum should be for the parent Committee to determine. Whether a minimum quorum should be set for Sub-Committees was a matter of some debate in the Committee on Procedures’ deliberations. In arriving at its decision, the Committee acknowledged concerns that full party participation might not be achieved in Sub-Committees. To set the quorum at two or three would not resolve that potential problem. However, the Committee was confident that the new Standing Order would make it explicitly clear that Sub-Committees cannot make decisions on behalf of the parent Committee but must make its recommendations to the full Committee. That would allow full party participation in the decision- making process.

The purpose of the new Standing Order is to clarify the existing provisions of Standing Order 52 and to give Committees greater flexibility to manage their work pro­gramme. The amendment is part of our ongoing programme to improve methods of doing business in the Assembly.

Amendment agreed to (with cross-community support).


Livestock and Meat Commission

I beg to move

Rev Dr Ian Paisley (Chairperson of the Committee for Agriculture and Rural Development):

That this Assembly takes note of the Report from the Committee for Agriculture and Rural Development on its Inquiry into the Livestock and Meat Commission (1/01R).

I call Members’ attention to the corrigenda that have been circulated. Members should keep that information for reference when reading the report. There has been a mix-up between "producers" and "processors," and it is important that the two groups be correctly referred to.

For Members unfamiliar with the subject of the inquiry, I shall set out some background information. The Live­stock and Meat Commission for Northern Ireland (LMC) was founded by law in 1967. It had the task of providing services to the Northern Ireland red-meat industry, which is vital to our economy, and to advise the Department of Agriculture on other related matters. The LMC is an executive non-departmental public body sponsored by the Department of Agriculture and Rural Development.

To many farmers, the LMC is something of an enigma. They believe that it has become too closely aligned or too cosy with the meat processing companies and has lost sight of the farmers’ interests.

In other words, farmers are saying that the LMC is providing services to only one part of the red-meat industry and that its independence is compromised.

11.15 pm

The LMC’s carcass classification service and the make-up of its board are also common causes of complaints from farmers. Against the background of such criticism, the Committee agreed to undertake the inquiry, and it concentrated on two parts of the LMC’s work - promotion and classification, and the way in which it is funded and its members are appointed.

First, I would like to thank those from all sectors of the industry who took part in the inquiry. The LMC gave its full co-operation throughout. Its chairman and the entire board accompanied the chief executive and marketing manager to one of the seven oral sessions that were held. The Committee also received 17 written sub­missions to the inquiry, for which we are most grateful.

Using that significant body of evidence, the Committee aimed to get under the skin of the LMC to discover whether the criticisms of it were justified and to offer constructive suggestions about how things might be improved. With the publication of our report, which we ask the Assembly to take note of, the Committee has achieved its aims.

The Committee makes a total of 33 recommendations, the majority of which are aimed at the LMC. A number are also aimed at the Department of Agriculture and Rural Development as the sponsoring Department of the LMC.

The Committee believes that the Department of Agriculture and Rural Development has a significant role to play in improving the sectoral balance of the LMC and in ensuring that it performs its statutory obligations in a manner that is seen to be totally impartial. Having considered the evidence, the Committee concluded that the LMC must re-invent itself to counteract farmers’ perceptions. The Committee believes that the LMC must demonstrate its impartiality and independence much more clearly than it does at present, and our recom­mendations will help it to do that.

I do not propose to list or explain all the report’s recommendations; however, I would like to highlight several of them. To begin with, the Committee considered producers’ concerns about the relationship between the LMC and the meat processing industry. We have called for the LMC to develop and publish a protocol in which it will define the purpose, level and frequency of all contact between it and the processing industry. That is an attempt to overcome the perceptions of cosiness while recognising that those bodies will need to work closely together at times.

The Committee also addressed producers’ disquiet about the fact that the current chairman of the Northern Ireland Meat Exporters Association also serves on the LMC board. The Committee has asked the LMC and the Department of Agriculture and Rural Development to consider the implications of such a situation in an attempt to avoid conflicts of interest.

Secondly, the Committee calls for a code of conduct to be drawn up to establish standards of behaviour expected of board members towards their home sector. Such a code would allow interested parties to make judgements on whether individuals were behaving in an appropriate manner. The code would apply as equally to farmers’ representatives as to those with links with the processing industry.

It is important to consider the fears about the major meat processors. The Committee invited them, through the Northern Ireland Meat Exporters Association, to participate in the inquiry. The Committee wanted to ensure that all sides of the argument were heard. The meat processors participated fully, which the Committee appreciated, although it did not see eye to eye with them on many topics.

However, it became clear that the meat exporters’ interest in the LMC begins and ends with its marketing role. That is, perhaps, understandable. Their livelihoods depend on securing markets and making profits. They forget that the LMC is meant to support the entire industry, not only one sector of it. That includes farmers who have spent time and money, and who have made strenuous efforts to provide the raw materials that allow processors to achieve their profits. Those profits are hand­some in comparison to the farmers’ poor returns. I repeat that the profits of the processors cannot, in any way, be compared to the poor returns of the farming community.

At times, the meat exporters’ attitude to farmers had bordered on contempt. They said that it was not the issue that farmers did not know what promotional work the LMC was doing. They said that once-a-year producers and cattle dealers were out of touch with classification and that mixed farmers had little understanding of classification standards.

The meat exporters wanted the LMC board to be made up of captains of industry who could demonstrate their marketing vision and who understood the inter­national marketing arena. They said that farmers were not the best people to be involved in marketing. They failed to recognise the imbalance caused by ignoring the most crucial part of the industry. In such a scenario, the meat exporters clearly consider the farmers’ needs, aspirations, opinions and expectations to be of little consequence.

From the evidence heard by the Committee, it was all too obvious why producers fear that, as they put it, the meat exporters control the LMC. It is necessary for the LMC to demonstrate that its commitment to producers is not compromised by its relationship with the meat processing industry. The Committee’s recommendations attempt to ensure that the correct balance is restored and that improper influence, perceived or otherwise, is no longer an issue.

The Committee made 10 recommendations on carcass classification. All sides recognised that that area caused greatest contention and farmer frustration. The Committee accepts that there will always be difficulties with such a subjective system, especially when the grade awarded can make such a substantial difference to the price paid to farmers. However, the Committee made an important dis­covery: the LMC’s classification staff are permitted, under EU legislation, to be wrong in 20% of all classifications.

I asked one of the LMC members whether he would tell employees that they could afford to make mistakes in 20% of all their classifications. He replied that he would do nothing of the sort. The Committee said that the LMC should be doing nothing of the sort. Frankly, the Committee was astonished, despite assurances by the LMC that its employees do not err to the permitted extent.

The rules do nothing to reassure producers. Some of our findings relate to the fundamental rights of producers to see and to understand how their animals are graded and to question the results. The Committee’s objective is that due respect be given to the farming community, that the classification service be applied impartially and consistently and that education about the service be targeted at those who need it most.

Funding is always an important issue, and the Committee made a series of recommendations in that regard. All sectors of the industry agreed that more funding for the LMC was necessary. Our inquiry established that Government support in varying degrees is provided to equivalent bodies in England, Wales, Scotland and the Republic of Ireland. The Committee’s recommendations seek to redress that imbalance and to provide continuity of funding, but to avoid the need for large increases of the slaughter levy paid by farmers. I emphasise our belief that the LMC should not be funded from the farmers’ pockets. The meat exporters advocated a large increase in that levy. However, the Committee was satisfied that no such increase could be justified, nor would it be sustainable, given the farmers’ present economic position. The main recommendation was for Government funding of the LMC’s promotional activities as part of a clear marketing strategy. That does not represent the Committee’s unconditional approval of the LMC’s promotional work; rather it asks the Department and the Executive to recognise the importance of the red-meat industry, and acknowledge that EU state-aid rules include an obligation to provide assistance with marketing and promoting the industry’s products.

In conclusion, the report is the Committee’s honest attempt, after spending many hours in interviews and debates, to make a real difference. It sets out to help to overcome some of the problems faced by the LMC, particularly with regard to how they communicate with, and are perceived by, their most important customers - the farmers.

I commend the report to the Assembly.

Mr Deputy Speaker:

This is a time-limited debate, and I would be grateful if Members will limit their remarks to 10 minutes.

The Deputy Chairperson, Committee for Agriculture and Rural Development (Mr Savage):

I support the motion and associate myself with the Chairperson's comments on the report. It is an important piece of work, and I extend my thanks to everyone who participated in the inquiry.

I highlight two recommendations that were not covered in the Chairperson's opening remarks. After we had finished taking evidence, but before the report was compiled, there was discussion in the agricultural press about the creation of an agricultural forum.

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The Committee agreed that that was relevant to the inquiry into the Livestock and Meat Commission, part­icularly in view of the findings regarding communication with producers, and also throughout the supply chain. For that reason, in its report the Committee agreed to recommend that discussions should take place, which would lead to the development of such a forum. More specifically, the Committee has asked the Department of Agriculture and Rural Development to facilitate those discussions, given that it has the necessary resources and accommodation. The proposal concerns development of the supply chain, which is in the Department's remit.

The recommendation is consistent with those made by the Committee in previous reports. For example, in its report 'Retailing in Northern Ireland', the Committee asked the Department to develop a structure whereby retail expertise could be used to improve the export of Northern Ireland goods. The Committee also asked the Department to create a scheme that would allow groups of producers to avail of processor and retailer assistance and advice in areas such as training, marketing and consumer research. In its report 'Restoring Profit for the Beef Producer', the Committee asked the Department of Agriculture and Rural Development to create and lead a production task force that would consult with processors and retailers and focus on serving the markets better.

One stage of the chain has been overlooked; that of the consumer and the housewife. I am glad to see the Minister of Agriculture and Rural Development in the Chamber; she is both our Minister and a housewife. A major problem is staring every farmer in the face. The BSE crisis and other matters have helped to bring the agriculture industry down, but the cost to the housewife has remained unchanged. There is a profit of some 30 to 40 pence per kilo on beef. Where does that profit go?

The pig sector reported encouragement, better com­munication and co-operation among all elements of the supply chain. A properly organised forum could provide a better structure for the relationships in the supply chain. I hope that the Department accepts the Committee's recommendation.

The Committee's second recommendation seeks a thorough and transparent inquiry into the alleged practices of some meat plants in Northern Ireland. All those allegations fell outside the remit of the inquiry. Members agreed that they were relevant to it, given the Committee's scrutiny of the carcass classification service. How can producers have confidence in a classification system that can be inconsistent in the application of standards and the awarding of rates? In fact, that might also be open to abuse, with meat plants changing grades once classification is complete. The allegations must be fully investigated in order to build producer confidence and to safeguard the markets in which the processors operate. Under European law regarding the classification of beef carcasses offered for sale, the Department is the competent authority and it must act quickly and decisively.

I commend the report to the Assembly. I will ask the Chairperson to ensure that the Committee follows up the two additional recommendations that I highlighted.


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