Northern Ireland Assembly
Tuesday 9 October 2001 (continued)
Mr Bradley:
I apologise if I repeat points made during the in-depth analysis and presentations given by the Chairperson and the Deputy Chairperson of the Committee. I support the changes to the make-up of the LMC board. Those changes would result in all participants in the supply chain having full confidence in the LMC. Members of the board would then be seen to be acting impartially and independently, with a full understanding of the circumstances faced throughout the chain.
Producers must be represented in order to remove the element of doubt that is always present when the LMC's role is being discussed. The board would gain more credibility with producers if the board of the commission adopted a policy of more all-inclusive membership. The imbalance would be addressed by increasing to nine the number of members of the board, and allocating a third of the positions to farmers. That would provide an ideal foundation on which to build improved relationships.
I support the view that members of the commission should be paid for attendance at meetings and when appointed to work in its interests. Producers should have some access to classifiers' work. If the classifiers have such self-confidence in their work, and if access to that work improves business relationships, why should producers not have a right of access?
Some witnesses called for a better appeal procedure, while others even questioned its existence. The Ulster Farmers' Union gave the considered opinion that the existing appeal procedure needs to be overhauled to make it more friendly to producers, and that a procedure must be implemented whereby all genuine enquiries and concerns would be fully addressed.
Widely used terms such as "openness", "transparency", "quality", and "best practice" spring to mind. Witnesses expressed many different views during the inquiry, but the word "Holstein" was quoted several times. That word seems to set off alarm bells for graders. If the graders did not know in advance that the carcass was a Holstein, I believe that the grades might have been different.
During the evidence sessions, we were told that grade prices varied from £1·70 per kilogram to £1·30 per kilogram. Since we received those figures in May, I have seen producers' dockets on which the price has ranged from £1·25 to £1·15 for a batch of meal-fed Holsteins. I found the figures difficult to believe - we can only imagine how the producer felt.
Putting the issue of Holsteins aside, I share the concerns of the chairman of the Northern Ireland Agricultural Producers' Association (NIAPA). In written evidence, he stated that many farmers believed that grading standards must keep moving as producers continue to spend more on resources to improve their breeding stock. It appears to be a case of improvement without reward. That leads me to the issue of the 20% margin of error that classifiers are permitted, which was referred to earlier. That margin of error is difficult to accept from a professional body such as meat classifiers, and it must be reviewed. Perhaps farmers could be granted similar latitude when completing integrated administration and control system forms (IACS), but I doubt that that will happen. I appreciate that grading is not an exact science and that the number of grades that are in place at the moment are not helpful to anyone. However, I share the view of my Colleagues on the Committee that the classifiers' performance must be made demonstrably better than it is at present in order to build all-round confidence in the payment and grading system.
I support the suggestion that the Department of Agriculture and Rural Development should facilitate producer meetings with the LMC, in consultation with farmers' representative organisations. A series of meetings would provide the opportunity for the LMC and the producers to exchange views, and for producers to learn more about the LMC's activities. The Department of Agriculture and Rural Development could also consider facilitating the proposal to develop an agricultural forum in order to structure the relationships between the LMC, the Northern Ireland Meat Exporters' Association (NIMEA), producers, consumers and all other interested parties.
In the past I have called for information technology (IT), sponsored by the Department of Agriculture and Rural Development, to be made available in the homes of full-time farmers. With appropriate IT training, we could end the nightmare of bureaucracy and form completion that farmers currently face. It should be simple to devise a farmers' computer programme that would be compatible with technology in the Divisional Veterinary Office and with the LMC. The provision of IT-accessible information from bodies such as the LMC would be a welcome factor in customer relationships. It would also keep the producer updated on relevant LMC information.
At no time did the Committee have a "let's-get-LMC attitude". This was not a witch-hunt. Throughout the inquiry the Committee worked positively and constructively to improve relationships between all sectors of the beef industry. Naturally our prime concern was the interest of the farmer/producer. If beef production in Northern Ireland ceases, that will have a knock on effect on many in the agriculture industry.
I call on the Minister of Agriculture and Rural Development to initiate an in-depth study of the Committee's report, with a view to implementing the recommendations. The methods that must be implemented to secure the long-term well being of the producer, the LMC, the meat plants, the graders, and the general beef industry can be found in the pages of the report.
Mr McHugh:
Go raibh maith agat, a LeasCheann Comhairle. I commend the report to the House. It forms a vital part of the inquiries that we have carried out on the agriculture industry. People in the industry - including some of those who gave evidence to the Committee - may well feel that the report's criticisms are directed at them. However, there is a positive side to this also. The report contains 33 recommendations, together with the evidence collected. It is there for everyone to read.
I hope that the report will focus people's attention in a way that has not been the case in the past. We have found through our work in the Assembly - and not only in agriculture issues - that there has been a tremendous lack of critical self-examination by industry, and especially by statutory bodies including the LMC. The agriculture industry tends to grind on without necessarily looking at things from the point of view of the individuals who go to make up the industry, such as the primary producers.
Many people may feel that the Committee of Agriculture and Rural Development is biased towards farmers, but that is not the case. The Committee is critically examining the entire situation and, in some instances, has tried to strike a balance on behalf of the producer. In examining what is sometimes conflicting evidence, the Committee has found that the bodies involved, the LMC in particular, have not taken farmers' concerns and opinions into account, nor acted on those concerns. The Department of Agriculture and Rural Development has a role to play as overseer of the industry. In order for there to be an industry in the future, it will have to work as a unit. It cannot operate in separation, with some parts making a profit while others do not. If the industry does not work as one unit, we will have no farming industry here, and we do not want that to happen. That is part of the reason why we have carried out inquiries and targeted groups such as the LMC.
Concerns have been voiced about an inquiry that was conducted by the Department before 2000 and which was not published. This inquiry is therefore timely.
The LMC's role is to support the livestock industry and provide services for the processors. Many people who have given evidence to the Committee have expressed concern about some of the LMC's relationships and its impartiality. It is a difficult issue. I do not know how it is going to be resolved, but it must be resolved. Many farmers perceive that they are being blamed for not taking action, or for not being capable of taking action. For example, as regards grading, many farmers feel that they are being accused - not only by the LMC but, in some instances, by NIMEA - of not being up to the job because they are not large-scale meat producers. We do not want to reach the stage where all farmers in this part of Ireland have to become large-scale producers like those in Argentina. We can never reach that level of production. We will never reach a situation where farmers are committed to large-scale production. We will always have family-size farms and the difficulties associated with them. The blame has been pointed in the wrong direction. It should have been apportioned even-handedly. It was not.
11.45 am
Other difficulties about the LMC were raised by many in the farming industry. Farmers - the primary producers - felt that they were under-represented and that their point of view was not being heard. There were no female representatives. The way appointments were made was mentioned and also the fact that the individuals appointed could sit on other boards. All these things are important. Farmers have always felt that everyone else is against them. We require clarity of purpose for each individual member. Are particular interests being neglected if someone is sitting on two boards? If so, that needs to be changed for the betterment of everyone.
The classification system was probably the most contentious issue for farmers. The grading of animals is one of the services provided by the LMC. Who gets the most out of that, the producer or the processor? For farmers, the question of value for money was a concern. The amount they pay to rear each animal - for little return in many instances - is a problem. In a previous report we read about alleged cartels among the processors. It may be no more than a perception. However, it has never been developed any further than that.
There is a communication problem between the LMC, the processors and the producers which needs to be put right. Both the Farmers' Union and the Northern Ireland Agricultural Producers' Association mentioned this. This is a critical point, and we have made recommendations to deal with it.
The promotional activities of the LMC were also focused upon. Everything was going well before BSE and foot-and-mouth disease struck. Farmers were receiving good prices. Now things are totally different. Markets came under particular pressure at that point, and we have to ask questions about the type of markets that are available. The processors and large supermarkets do not really mind where they source their raw produce. They are happy enough to go to Argentina or Brazil, and both countries have said that they are going to treble their output of beef in the next three years. This is what we are up against. Most of our beef is sold in the British market, with small amounts sold in the European market. Farmers feel they are paying for something that is not really happening. They are not getting to the wider markets, so why should they bother paying at all?
Quality assurance is an extra pressure and expense for farmers, and they do not necessarily gain anything from it, as it is not directly connected with the production of beef. Beef from farms that are quality assured and beef from farms that are not probably go to the same markets and achieve the same prices. This week, the price is 65p per kilo for heifers in local markets. A farmer selling at that sort of price has to ask what is in it for him when steak costs around £14.
These are the difficulties as farmers see them. Everything will have to change over time, and we need to find a way forward. Our recommendations certainly point the way. The retailers, the LMC, the NIMEA, the Department of Agriculture and Rural Development and everyone else have to take account of each and every one of those recommendations. I have been told that some of them will not be taken into account, but most have much to offer.
Another point raised concerns a 20% error rate in the grading classification. That should not be the case, but those things have only come to light through the report. There is far too much inbuilt leeway. We have produced a positive report, but there is much justified criticism. However, it should be seen in a positive light, because we want to improve the industry's future for everyone, particularly the producers who have not been looked after so far. Go raibh maith agat.
Mr Douglas:
I too welcome the report. There seems to be a great gulf between producers and the LMC. Producers see the commission as too closely aligned with the meat processors. Reasons for that perception include the inadequate producer element on the LMC board and the apparent processor bias given the number of seats producers hold.
It is imperative that a body that promotes our meat has the necessary expertise of the processing sector, but is it necessary to have the chairman of NIMEA and the directors of two of our major meat processors on the board, with only two part-time farmers? It is difficult to understand how a balance can be achieved.
To correct the perceived bias, we must have a fully transparent and independent nomination and appointment process which is representative of all. If that can be achieved by more openness, perhaps farmers will come to have a greater affinity with the LMC, which should be their board after all. They fund it, and it should be for the benefit of everyone.
We must give credit to the LMC for its work in promoting Northern Ireland meat. That is an important aspect of the meat industry which must be pursued vigorously. I am glad to see the continued pursuit of international markets and the contracts that have been established with potential customers to ensure that, when the European market opens up again, there are good relationships to build on.
We must remember that pre-BSE, when beef was trading at a top price of 240 pence per kilo, as opposed to 160 pence today, that price was obtained by successful exports to Europe through the greenfield brands and a more favourable exchange rate. The Department of Agriculture and Rural Development must press for low-incidence BSE status again soon, so that at least one of those variables can come into play and, I hope, lead to the re-establishment of Northern Ireland beef on the premium market which it deserves.
Unfortunately we cannot control the exchange rate, so we must work on the export factor to increase competition in the marketplace. The LMC can market produce both at home and internationally, but the programme must be funded, and that is a point of contention among producers and processors.
One of the main problems is that any additional levy collected from processors always finds its way out of the producers' pockets. As processors protect their profits no matter what happens, producers need more information on the promotional activities, funded by them, that are carried out by the LMC and the processors. They might then be more willing to consider a small increase in funding, perhaps through a transaction levy at a low level, to ensure that funding comes from the whole food chain and not just the producers.
Many producers feel that most of their levies support grading, and due to their bad experiences with that system they are reluctant to fund such activities. Farmers do not like the words "carcass classification", and the majority of producers do not do not like the present system. The LMC maintains that it is lenient and biased towards the farmers, but that is strongly refuted by most producers. The main tenet of this is the reluctance to have farmers see their cattle graded and the reluctance of the meat processors to have the producer there to see cattle being classified.
Variations of 20%, as the report states, are too high and must be drastically reduced. A 1% difference in classification can result in a 6p per kilo differential in the cost of a carcass, which equates to approximately £30 per animal. That is unacceptable and must be improved on; alternatively, new subjective systems, which are now available mechanically, must be adopted. Producers must be reassured by being actively brought into the system and educated regarding the reasons for giving particular grades. Undoubtedly the producers have their part to play in producing carcasses that meet the demands of today's markets.
Unfortunately, because of the MacSharry proposals in the early 1990s, farmers have not so much been encouraged to keep more cattle, as they have had to keep more cattle to be able to survive and to make a profit. There was little encouragement for farmers to produce better quality. They just kept higher numbers in order to survive. Perhaps that needs to be addressed.
The Department should be congratulated on its attempts to educate farmers through the colleges regarding keeping better cattle so that we have better carcasses. Ultimately there are some cattle that do not meet the higher standards that are now needed in the world. Much more must be done through the farming community and through LMC to promote better cattle for today's markets.
The report is a well-balanced reflection of the LMC's operation. Its recommendations seek, to help advance the aims of the organisation by making it more transparent, farmer-friendly and responsive to the long-term needs of the industry. After all, there is an important job to be done in promoting the Northern Ireland meat industry, and we must have a strong and progressive organisation to do that.
Mr Paisley Jnr:
I welcome the opportunity for the Assembly to take note of another report by the Agriculture and Rural Development Committee. I support the comments of the Chairperson and Deputy Chairperson. I thank our Committee Clerk and staff, and all who participated in the Committee, on coming up with another excellent report.
We are here to take note of the report, and I understand that the Minister will want some time to study it in detail and consider the recommendations and their implications, both for the LMC and for her Department. I look forward to another debate on the details of the report at a later stage. I hope that by that time the Minister will have responded and will have prompted some action to deal with our recommendations.
However, it is important to sound a note of warning and caution. I hope that this report does not suffer the same fate as the other three reports that our Committee has produced: they are published and the fundamental matters that we address are considered, but nothing else appears to happen. I have no doubt that today all sides will unite and endorse the report. Unfortunately, that is where it all appears to come to an end.
There is a sigh of relief after public representatives have spoken on these matters, but no action appears to flow from them. As a result of our previous reports, the Department has implemented the minimum, not the maximum, amount of activity. The Department has other issues and its own agenda, but it is important that these issues are taken up and implemented as fully as possible.
What I am going to say next is not just a criticism of the Department of Agriculture and Rural Development, it is a criticism of all Departments. Indeed, it is a criticism of Government generally. Departments appear to be a big, amorphous sponge. They are able to soak up all the criticism.
They are able to note all the concerns, but without any apparent change on the surface. There is no change in direction or policy, and no change in legislation. The only Bill that the Department of Agriculture and Rural Development had to give time to was the Dogs (Amendment) Bill - a minor piece of legislation - and that was in the previous session.
12.00
Sooner or later, someone is going to look at our Government and ask whether they are doing anything that is more strategically helpful to local farmers than previous Administrations did. If we have to search to see whether we are making a difference, the Administration, in general, fail the test. We must face up to that. All the excuses of the day will be levelled at me for those remarks, such as the fact that our hands are tied by regulations from Europe and by European Directives, or that we have had a major foot-and-mouth disease crisis. I accept that.
However, such problems limit what is possible; they do not prevent the Government from taking action. We must not allow the Department, or any Administration, to padlock itself into a cage and stand still. The world goes on in spite of those crises and setbacks. The Administration will be judged on how they work through those crises to achieve their goals.
A report from the Committee for Agriculture and Rural Development is before the Assembly. Previously, after debating such reports, the Committee was right to anticipate action from the Department in view of the unanimous endorsement that those reports received. I hope that the Minister will say today that, if this report also receives a unanimous endorsement, it will not suffer the fate of previous reports and action will be taken.
It would be disgraceful if the report were shelved. I hope that the Department is prepared to implement the report's recommendations that directly affect it. If the Minister is prepared to implement them, I hope that she will be able to provide us with a timescale for implementation. We can only judge the Department by the timescale that it sets, and it should let us know whether it has a timescale in mind. It is important for Members to know the answers to those questions; otherwise we are wasting our time, and we do not want to feel that we are doing that.
The Chairperson has said that it is time for the LMC to re-invent itself, and I agree with other Members on that. If it is time for the LMC to re-invent itself, the Minister must take the necessary action to bring that about. Does the Minister agree that the producers do not perceive the LMC in a favourable light? Does the Minster agree that the LMC requires more than a makeover and, if so, what is she going to do about it?
I refer to paragraphs 2.1 and 3.4 of the recommendations of the executive summary about the perception and communication of the LMC. It is important to put on the record the points that have been summarised in the report. The report states that
"Both the Committee and representatives of producers believe that the relationship between the LMC and the Northern Ireland Meat Exporters Association (NIMEA) is perceived as being too close, compromising the independence of the LMC in the eyes of the producers."
It is important that the recommendations to deal with that are fully implemented. It goes on to say that there is
"poor communication between the LMC and producers. This has contributed to suspicion and scepticism on behalf of the producer in relation to a range of LMC activities and must be addressed."
On page 207 we see NIMEA's paranoia in a submission that it made to us. One of the members of that body, instead of addressing the issue of communication between the LMC and the producer, spent two or three paragraphs criticising the Committee for raising that matter. That shows that either paranoia exists at the LMC and within NIMEA or there is a failure even to recognise that the producer has a legitimate concern, which the Committee attempted to get them to address. It is essential that the LMC and NIMEA tackle that issue. The criticisms that were made on page 207 by NIMEA were fundamentally wrong. Until NIMEA faces up to that and realises that the Committee's comments and its activities were designed to help the entire industry, it will continue to miss the point.
The Committee made several recommendations on funding and levy charges. We did not make them lightly, but we received a caveat that the Committee could support such a move only if producers here were receiving similar prices to those that their colleagues in Great Britain were getting. That is certainly not the case at present. We list seven or eight issues that relate to funding, which we hope the Minister and the LMC will be able to address, if not today, then when the Minister has had an opportunity to consider them in detail. We should not ask the Minister for a knee-jerk response to those important matters, which have important implications for the entire industry.
Is the Department going to invest in a new and more accurate classification system? That is important. The LMC does not have the resources to do that. The responsibility falls to the Department, and in paragraphs 4.2, 4.3 and 4.4 of the report we have highlighted some of our concerns in that regard. The Committee thinks that the accepted standard error in classification of 20% is too high and that actual performance must be regularly assessed should an error rate occur between 5% and 10%.
Farmers are dissuaded from viewing the grading of their animals. We recommend that farmers should be able to see their animals being graded, and we ask the Minister to implement that recommendation.
I hope that the Minister accepts that much of the concerns and animosity among the producer, the LMC and NIMEA arise from the perceived grading problems. The sooner that we have new technology in that area, the better for us all. I hope that the Department will respond to that request by providing the LMC with the resources and equipment that it requires.
Mr Armstrong:
I commend the report to the Assembly. In recent times, the LMC has failed to demonstrate independence and even-handedness in its work. The perception of the commission by farmers is relatively negative in various areas. In turn, that reflects on the flow of the entire supply chain.
The Committee for Agriculture and Rural Development's duty is to investigate such matters with the aim of creating an environment in which farmers can maximise their potential, and in which housewives can get value for money and products of the highest quality. It is our intention to raise concerns and make recommendations to ensure that agriculture in Northern Ireland is a viable industry.
The investigation found that the current system of animal classification is ambiguous, confusing and unaccountable. It is unacceptable that one in five animals receive a classification that is not totally correct. I reaffirm the report's recommendation that farmers should be encouraged to view the grading of their beef cattle. Producers must be clear about the process, and their animals should receive a fair grade.
LMC officials are seen to be partial to the interests of the processors. A system of appeals should be set up to safeguard producers' interests further. Immediate steps must be taken to restore farmers' confidence.
I support a reduction in the number of payment grades to make the system clearer. There could be around 25 different grades.
Does the housewife benefit from the present system? I do not believe so. I welcome the initiative on mechanical grading, which will help to reduce the extent of human error and inconsistency in the grading process.
The current links between the LMC and NIMEA are too close to allow farmers to have confidence in the LMC. It is unacceptable that the chairperson of NIMEA also sits on the LMC board. It is vital for the LMC to extend its grading process to benefit the consumer - our families. Consumers should be informed of the quality grade of meat products on display at retail outlets.
Finally, the LMC should work for the benefit of the farmer and monitor the complete supply chain. If Northern Ireland's agriculture industry were to disappear, there would be no need for the LMC. We all know the pressure that the agriculture sector is under these days. It is unacceptable that the primary producer has been made to feel alienated by the present workings of the LMC. I therefore encourage the LMC to take on board the Committee's recommendations and give confidence to the Northern Ireland farmers, thus enabling them to meet the needs of the consumer and processors.
Mr Dallat:
The inquiry could be a milestone on the way to recovery for the red-meat industry. I would not be so worried about the report gathering dust on the Minister's shelves; I would be more concerned about there being no Minister, because the LMC, like many other organisations, did its own thing during direct rule. It was answerable to no one.
Given that democracy will continue, the LMC cannot ignore the report's recommendations. If common sense prevails, the LMC will have to accept the findings and begin the process of rebuilding confidence, which is critical to the farming industry.
Without doubt, there is a serious image problem, but it goes much further than that. The LMC must convince the farming industry that it is totally impartial, independent and in no way influenced by the processors. That is no mean task, but it must begin immediately. The present conflict serves only to sap the industry of its energy and vision for the future. Reference has been made to funding, which is critical to the efficiency of any modern organisation involved in such important work. Consultation and sensitivity are required if radical changes are to occur.
The report concludes that the classification service is the major problem, and the Committee advocates a much greater degree of separation between the classification service and the LMC's other activities. The margin for error in classification performance is too great. It results in a serious lack of confidence - a confidence that must be rebuilt. There is a perception that the primary producer is undervalued by the rest of the supply chain. That is totally unacceptable.
Several Members have referred to marketing, which is one of the most critical aspects of our meat industry. However, I was not convinced that the issue was addressed with the degree of enthusiasm that it deserved. The LMC certainly failed to convince us of its success in that respect. Whatever the truth is, there is no doubt that more visible work on the domestic market would be beneficial.
Appointments have also been mentioned. They are often a contentious issue, and nowhere more so than in relation to the LMC. The report contains positive and useful recommendations to make the LMC more talented and representative in carrying out its duties. It would be foolish to ignore those recommendations.
Much of the concern expressed in the report relates to transparency and how the LMC carries out its functions. There is genuine concern that processors have undue influence and that that is to detrimental to the farming industry. The report's recommendations are intended to bring improvements to the operation of the LMC and to the greater interest of the red-meat industry.
I have no doubt that the Department will give every assistance to the LMC to repackage itself as an organisation that is free from unfair influence and that is dynamic enough to change for the common good of everyone.
12.15 pm
Mr Kane:
I support the motion. The inquiry into the LMC has been extensive, and those Members who are not directly involved in farming may be surprised by the diverse role that the commission plays in modern livestock farming. The commission's role is extensive and so too must be its obligation to its largest contributor - the farmer. That is why, almost unfailingly, farmers' representative organisations have questioned the level of farmer representation on the LMC board.
Farmers demand nothing less than appropriate representation on a body that claims to act impartially between them and the processors. It is hoped that the recommendations to resolve that problem will be adhered to.
LMC funding is fraught with controversy. Producers who have received minimum returns for produce are compelled to pay, whereas processors - and everyone knows how well they have done - contribute voluntarily. Not one farmer in the Province is fooled. Farmers know that the processors' stake is all too easily recovered from the producers, and the belief is that a stake from processors will serve only to increase the control of the sector over the LMC's activities. Therefore it is time to review the make-up and size of the commission board as contained in the recommendations.
Classification has been an area of extreme difficulty. Despite that difficulty, it is essential that those who carry out the task do so with impunity. Producers must be assured that the grading of animal carcasses will be done subjectively. An animal's value can be changed considerably by the grade awarded to it. The increasingly disturbing scenario is that classification is conducted by staff recruited by the processors. That is a daunting prospect and will render as useless any recommendations contained in the inquiry document. Members must act quickly in the event of such a development.
The LMC's reaction to strong branding of Northern Ireland's meat products has been lukewarm. Instead, it has favoured a farm quality assurance scheme as a more effective marketing tool. That is not as acceptable to producers, who have to pay up to £50 per year to participate in the scheme. Green Field was an effective selling brand for Northern Ireland beef before the BSE crisis. There is a strong suspicion that because the commission and the processors are so closely associated, and because a poorly administered farm quality assurance scheme means that all sorts of products are successfully marketed under the farm quality assurance scheme, that is the reason that the scheme was chosen over the branding approach.
It is also striking that even though the LMC is aware of price quotes for cattle and sheep - indeed, it compiles the figures in Northern Ireland - it has not questioned the disparity in price between the Province and the rest of the United Kingdom.
The inquiry has been extensive and protracted, but its recommendations are clear. The Assembly looks forward to the LMC's speedy adoption of the Committee's recommendations, not least its active participation in an agriforum. The agriculture industry eagerly awaits changes as a result of the proposals. Therefore, the onus is on senior figures in the commission to act or to accept the responsibility for the delay.
Mr Poots:
I support the report. However, part of our problem is that Northern Ireland beef producers cannot export. As has been highlighted, differences exist between the views of processors and producers. There is not as great a disparity between the producers and processors in other sectors of agriculture as there is in the beef sector, the reason being that since BSE the processors have been able to wring the producers for every penny.
The producers have been suffering ever since the ban was put in place, so there is a great burden on political representatives, especially the Minister of Agriculture and Rural Development, to see that the ban is lifted at the earliest opportunity. Until that happens, we shall not have a level playing field.
Members have highlighted the problem that allows 20% of grades to be wrong. I do not want to go any further with that as it has been spoken about for long enough. However, there are 42 different grades for animals, and there is a disparity of 60p per kilo, which could result in a difference of anything from £150 to £300 in the price of an animal. That should be addressed. Therefore, many grades are unnecessary, and we could have a much tighter grading system.
The grading system should be transparent so that producers feel that they are getting fair grades for their animals. I am concerned that the Vision Group's report considers transferring responsibility for carcass classifications from the LMC to the meat companies. Much of what we have heard this morning and read in the report has shown that producers are greatly dissatisfied with the meat companies. However, the Vision Group suggests that we should transfer responsibility for grading animals to the people who will buy them. The processors had the producers in a difficult position before, and to transfer grading to the processors will put the producers in an even more difficult position. I trust that when the Minister looks at the Vision Group's report she will throw that recommendation out of the window and have no truck with it.
The processors have said that levies should be passed on to the markets, so that every time an animal goes through the market there should be a levy on it. That would be wrong. Hill-sheep farmers bring their store lambs down from the hills each year to sell on to the lowland producers who buy lambs for fattening. If a levy were put on the market, lambs could be levied two or three times. That would be wholly unfair and go against the markets and, again, the producers.
I wish to express a note of caution. The markets offer an alternative for producers, which is why the meat plants do not like them. Where lambs can be exported, the markets allow farmers to maximise their returns in the conditions prevailing. Therefore, it would benefit the processors if the markets were hit with that levy.
I welcome the recommendation that a processor levy, fairly applied on a statutory basis, be imposed. The processors are currently paying that levy voluntarily, and they appeared to emphasise their generosity in their submissions by pointing out that they give that money to the LMC.
They have received a reasonable return for their benevolence, but it would be fairer for a statutory levy to be imposed on all processors.
The Minister of Agriculture and Rural Development (Ms Rodgers):
The LMC is a significant organisation in the Northern Ireland red-meat industry. It has a specific responsibility to advise the Government on industry-related matters, and it provides important services to the industry. It is therefore appropriate that the Committee for Agriculture and Rural Development has undertaken an inquiry into the LMC's activities. I welcome the publication of its report.
It would be inappropriate to give a detailed response to the report's recommendations because I received it only a few days ago, and it needs to be reflected on and studied properly. The Committee has asked me to respond in substantive terms in due course and I will do so, taking account of Members' comments made today.
In reference to the main recommendations of the report, the future funding of the LMC is an important issue. Nearly all the reserves that had been built up for several years have been used to help the LMC to undertake core activities. It is 13 years since the levy was increased, and another increase will be necessary if those core activities are to continue. I shall issue draft legislation for consultation to provide for an increase in the levy and to make statutory the levy currently paid voluntarily by processors. The size of that increase will be determined after the consultation process. I note the Committee's view that the increase should be limited to the rate of inflation.
I note also the Committee's comments on the classification service and the series of recommendations addressed to the Department and the LMC. The majority of contributors to the debate referred to classification. I recognise that, by its very nature, classification is a subjective process and that it is often, therefore, a controversial one. Undoubtedly, a mechanical system would provide the necessary objectivity, which , it is to be hoped, would remove a large element of the controversy. I agree with the Committee that we should work towards the development of a satisfactory mechanical system, although it would take some time to develop such a system and to achieve EU approval. In the meantime, I shall study the report's recommendations on the present system.
The Committee has also asked the LMC to consider recommendations that relate to its promotional activities, especially in the domestic market. I look forward to reading the LMC's response. The LMC undertakes considerable work in the local market at retail level. Moreover, it encourages young people - the consumers of tomorrow - to understand the nutritional value of Northern Ireland red meat. I was pleased to be able to assist the LMC in the launch of its summer lamb promotional campaign, an evaluation of which will soon be completed.
The Committee also made recommendations on the appointment of members to the LMC board. That issue was also discussed today by Mr Bradley, Mr McHugh and Mr Dallat, among others. I shall consider the matter in full. Reference was made to the regrettable absence of women on the LMC board. In the past, the board included a few women, but not enough of them. When the most recent advertisement for members was published, no women applied for the post, despite the fact that they were encouraged to apply. Women have a substantial contribution to make, especially in the area of marketing.
When forwarding the report, the Deputy Chairperson, Mr Savage, asked me to consider it in the context of a forthcoming appointment to fill a vacancy in the LMC that will arise at the end of the year. The appointment process has already started, but I assure Mr Savage and the Assembly that the skills and qualities required for that post were discussed fully with the chairman of the LMC before the advertisement was finalised. That advertisement will appear in the agriculture press, and the relevant industry organisations will be notified of the vacancy.
Mr Savage and Mr Bradley asked about the facilitation by the Department of discussions between the LMC and the producers. I am happy to confirm that the Department's facilities are available for meetings between the two bodies. They have been used for that purpose in the past. I agree with Mr Bradley's comments on the need for co-operation among all parties involved in the food chain and his recognition of the interdependence that exists throughout the chain.
12.30 pm
Mr Paisley Jnr referred to the problem of perceptions. I may have powers, but I do not have the power to change perceptions, especially in Northern Ireland. If I did have that power, we might have a different society.
In relation to Mr McHugh's point about the quinquennial review report, the final report was made available to the main industry organisations last year. I delayed its formal publication pending the outcome of the Committee's inquiry into the LMC. I have already told the Committee that I shall publish the review report as part of my response to its inquiry.
Mr Paisley Jnr made a point about my response to earlier reports. I have responded to the recommendations made in the Committee's previous reports where appropriate, and I have implemented them where appropriate. Not all recommendations can be implemented, because I must take account of wider issues, which include, unfortunately, budgetary considerations. Those represent a considerable constraint.
I agree with Mr Douglas's point about the importance of quality. I thank him for his remarks about the Department's efforts to deal with that important issue. The Department injected £2 million into the beef quality initiative, and it is hoped that that will bear fruit and improve quality.
Mr Poots mentioned the reopening of the marts. I am aware of the importance of that issue, and I am working hard on it. The Department is speeding up BSE testing in the hope that it can make a substantial case for reopening the marts by the end of the year. I have already spoken to Commissioner Byrne about this matter, and he is sympathetic. I have also spoken to Lord Whitty, who has agreed to support me when I go to Europe.
In a report published last week, I note that the National Beef Association (NBA) suggests that we should wait until the case is made for the whole of the UK, which would probably happen at a later date. In relation to Mr Poots's comments, it would be extremely unfortunate if, because of the DUP's point of view and current events, I were not in a position to pursue our case when the time comes. It will certainly not be in the interests of the Northern Ireland industry if the case for low-incidence BSE status is not pursued by a local Minister, as I have done.
I agree with Mr Poots's comments about the importance of lamb exports, and I am sure that he will agree that if a local Administration, led by a local Minister, had not been in a position to achieve regionalisation for Northern Ireland, we would not be exporting our lamb now. That issue underlines the importance of retaining our local Administration and of setting aside political stunts. I am serious about that, because the agriculture industry is in a serious position. We have been through difficult times, and it is important that we should be in a position to deal with all the issues as soon as possible.
Rev Dr Ian Paisley:
I welcome the debate, which has been useful in highlighting the report's main points. It is an important report, given the financial interests of farmers, the operation of the LMC, and the concerns and allegations that were made to the Committee during the inquiry. The Committee did not initiate the criticisms. The criticisms came from witnesses, and the report lists those legitimate criticisms. Some people may think that the Committee simply sat down, calculated the number of things that it could say, and put them on paper. That is utter nonsense. What is on paper is hard evidence, tested by close enquiry and cross-examination. The report reflects the views of farmers and of workers in the meat industry.
I agree with Mr Savage's comments, the Deputy Chairperson of the Agriculture and Rural Development Committee. The Committee will follow up the issues of meat plants and the agriculture forum.
Our report has been published at a time when there is a great deal of interest in another report, 'Vision for the Future of the Agri-Food Industry'. The Committee will meet the authors of that report shortly to compare our recommendations with those in the Vision Group's report before we draw our conclusions.
I regret that the Vision Group report proposes that the whole issue of classification be handed over to the meat companies. I am amazed at that recommendation, which falls completely contrary to the Committee's examination of the evidence. However, debate is healthy. The Committee welcomes the meeting with the Vision Group, and those matters will, no doubt, be discussed at length.
The Committee did not expect the Minister to give a considered response to the report, and it is glad that she did not. If she had given a considered response, it would have been a dismissal of the report. The Minister will study the report and may ask for further amplification. The Committee welcomes the fact that the report will be studied carefully - it certainly deserves to be.
I hope that the LMC itself will look at the report. I hear that one person has already dismissed it by saying that the Committee had no right to even consider those matters. As long as this elected body exists, it has the right under law to look into those matters and, no matter who is angry or who does not like it, we shall look into it and give our answers. We shall hear people's legitimate complaints and criticisms. The processing side of the industry has said that it is content with the LMC's work. Why would it not be content, given the cosy relationship that the processors have enjoyed with the LMC? The primary producer side sees things very differently, and those matters must be commented on.
I take off my cap as Committee Chairman in order to reply to the political point that the Minister made. If her party had walked into the Lobbies yesterday with the majority of the House, cross-community support would have been established, and the Assembly would have been unable to fall. It was because her party walked into the wrong Lobby that it will be responsible for bringing down the Assembly. I regret that I must say that, but when the Minister takes sides and lectures people on an issue that has nothing to do with politics, the world must hear that, had she and her party said loudly and clearly that there are Nationalists who want decommissioning and who want it now, the Assembly would not be in jeopardy.
I trust that this debate will continue, that the farming community will be given its rights and that future Committees appointed by the Department will be fairly appointed, giving representation to all sides of the community.
Question put and agreed to.
Resolved:
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).
The sitting was suspended at 12.39 pm.
On resuming (Mr Deputy Speaker [Sir John Gorman] in the Chair) -
2.00 pm
Threshold Assessment (Northern Ireland)
The following motion stood in the Order Paper:
That this Assembly believes that the 'Threshold Assessment (Northern Ireland)' does not provide equality for all members of the teaching profession. - [Mr B Hutchinson]
Motion not moved.