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Written Answers - Sugar Industry

Tuesday, 7 February 2012

Dáil Éireann Debate
Vol. 754 No. 3

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 428.  Deputy Tom Barry Information on Tom Barry Zoom on Tom Barry  asked the Minister for Agriculture, Food and the Marine Information on Simon Coveney Zoom on Simon Coveney  if a company (details supplied) received €50 million specifically for the provision of former workers’ pensions upon the cessation of sugar production at the Mallow plant. [6346/12]

[513]Minister for Agriculture, Food and the Marine (Deputy Simon Coveney): Information on Simon Coveney Zoom on Simon Coveney As part of the reform of the EU sugar regime in 2006, a temporary scheme for the restructuring of the sugar industry, was introduced with the aim of reducing EU sugar production in order to comply with WTO and other international obligations. The scheme provided an incentive for sugar processors to renounce sugar quota and dismantle the associated sugar processing plant and it provided compensation for affected stakeholders. Greencore, the sole Irish sugar processor and holder of the Irish sugar quota, decided to avail of this scheme and accordingly the company renounced the quota and dismantled the last remaining sugar factory at Mallow in compliance with the conditions of the scheme.

The total compensation package negotiated in November 2005 in the context of the reform of the EU sugar regime, as modified in 2007, was worth €353m to Ireland, made up of €220m to beet growers, €6 million to machinery contractors and €127 million to Greencore plc. The beet growers’ share was made up of restructuring aid of €53 million, diversification aid of €44 million and €123 million via the Single Farm Payment. All elements of the restructuring aid package have been paid in full.

A High Court judgement in 2007 quashed the original Government decision on the percentage of aid to be reserved for growers and contractors. The ruling also stated that the EU Regulations do not empower the Member State authorities to direct how the restructuring aid is to be applied by the processor. Therefore, the Deputy will appreciate I have no remit in how the aid was allocated by the processor.

 429.  Deputy Tom Barry Information on Tom Barry Zoom on Tom Barry  asked the Minister for Agriculture, Food and the Marine Information on Simon Coveney Zoom on Simon Coveney  if attempts can or will be made to access the remaining processors’ fund finances to assist with the re-establishment of sugar production here. [6347/12]

Minister for Agriculture, Food and the Marine (Deputy Simon Coveney): Information on Simon Coveney Zoom on Simon Coveney As part of the reform of the EU sugar regime in 2006, a temporary restructuring scheme was introduced with the aim of reducing EU sugar production in order to comply with WTO and other international obligations. The scheme provided an incentive for sugar processors to renounce sugar quota and dismantle the associated sugar processing plant and it provided compensation for affected stakeholders. Greencore, the sole Irish sugar processor and holder of the Irish sugar quota, decided to avail of this scheme and accordingly the company renounced the quota and dismantled the last remaining sugar factory at Mallow in compliance with the conditions of the scheme. This was a commercial decision taken by the Company having regard to the deteriorating market situation.

The total compensation package negotiated in November 2005 in the context of the reform of the EU sugar regime, as modified in 2007, was worth €353m to Ireland, made up of €220m to beet growers, €6 million to machinery contractors and €127 million to Greencore plc. The beet growers’ share was made up of restructuring aid of €53 million, diversification aid of €44 million and €123 million via the Single Farm Payment. All elements of the Restructuring Scheme have now been implemented, not just within Ireland but across the EU.

Post reform production is now concentrated in 18 Member States. The present regime runs from 1 September 2006 to the 30 September 2015. There is no mechanism under the present EU Regulations which would allow for the re-instatement of the sugar quota for the growing of sugar beet in Ireland for the production of sugar.

Notwithstanding the current legal limitations, I have strongly supported the abolition of the EU sugar quota regime from September 2015, as part of the CAP reform discussions which are currently underway in the EU Council of Ministers. I also raised the issue with EU Commissioner for Agriculture, Mr Dacian Ciolos during his recent visit to Ireland. In this regard, I have also met in 2011 with two separate groups here who have conducted feasibility studies, [514]into the possibility of establishing a sugar/bioethanol facility. At both meetings I stated that any venture to develop a combined sugar/bioethanol production facility would have to be a commercial proposition, financed in total by investors and interested parties and make sound economic sense in order to be viable.


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