Diarmaid Ferriter: The Irish beef industry is enveloped by greed

The politics of Irish beef has been paramount and poisonous since the foundation of the State. Every decade since the 1920s has witnessed controversy about beef.

There was the privileging of cattle exporters by the State’s first minister for agriculture, Cumann na nGaedheal’s Patrick Hogan. In the 1930s cattle were centre stage in a new, difficult chapter of Anglo-Irish relations when de Valera’s government withheld land annuities owed to the UK government and it retaliated by imposing 20 per cent duties on Irish exports of livestock. Then there was the wrath of the farmers led by Rickard Deasy with his hawthorn stick and black beret on an 11-day march from Bantry to Dublin in 1966; he then sat for 22 days on the steps of the department of agriculture. In the late 1970s came a reduction in the rapid rate of increase in agriculture prices under the Common Agricultural Policy (Cap) as the EEC got frightened of overproduction in the late 1970s, coinciding with minister for finance George Colley, battling straitened public finances, proposing a 2 per cent levy on farmers’ sales. Colley had a compelling case, as income tax on farmers in 1978 accounted for only 1 per cent of their gross incomes compared with 16 per cent for the average industrial worker; farmers again became wrathful and PAYE workers retaliated with their own large-scale protests.

The following decade, private beef processors were given huge amounts of government export credit to trade with Iraq, and in summer 1990 the Dáil reconvened for an emergency session in order to pass emergency legislation to appoint an examiner rather than a liquidator for the Larry Goodman beef companies. The onset of the Gulf war left the Goodman group with uncollectible credits of £180 million. Lack of state control and regulation of the beef industry meant awesome private fortunes had been made, particularly after the EU began to buy beef into intervention to keep the price from falling.

Comeback king

Goodman has made a remarkable recovery. His ABP group is one of Europe’s leading privately owned food processors; it operates across nine countries and consists of four divisions: beef, proteins, renewables, and pet food. It had a turnover of €2.9 billion in 2018.

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Some people make a remarkable amount of money from Irish beef processing but not the meat factory workers where “meat-processing operative” jobs are advertised at €22,000 annually, described by Mick Browne of Siptu as “the absolute minimum” that could be “legally applied”. He has pointed out that many workers in the meat-processing sector depend on the Government to subsidise their income through family income support. Contrast, as Browne has, the high standards of animal welfare and food quality, hygiene and traceability in the meat sector with the pay and conditions of those workers.

In its submission to the Low Pay Commission in 2015, Meat Industry Ireland argued trenchantly against any increase in the minimum wage rate as it “would significantly increase the cost base for the meat-processing industry and have a negative impact on the sector’s ability to compete globally in both servicing new and existing markets. There would be a resultant expectation among other pay grades that their rates should increase proportionally. Ultimately such an increase in the minimum wage would prove a threat to the competitiveness of the Irish meat-processing sector at a time when the industry is considering future expansion to put the sector on a strong footing to compete globally into the future”.

Price increase

The small-scale farmers who have been so voluble in their protests in recent weeks are being offered a pitiful €3.45 per kilogram for their cattle and have suggested, hardly unreasonably, that the solution to the problem is a modest increase in this base price guaranteed for a few months. Suckler farmers continue to depend on Cap direct payments for their livelihoods, with average incomes just below €13,000, according to Teagasc. Other figures released by Teagasc show that average farm incomes for 2018 dropped 21 per cent compared with the previous year. Overall, incomes on cattle-rearing farms dropped 22 per cent, from €10,642 in 2017 to an estimated €8,318 last year.

The latest chapter in the history of our beef controversies is yet again a reminder of how the industry is enveloped by greed and imbalance alongside compartmentalisation and inconsistency by the State. The deal that was brokered by Minister for Agriculture Michael Creed is, he maintains, “as much as can be done”. As much as can be done by whom exactly? And what about retailers’ responsibilities? Creed and his colleagues directed their frustration at the wrong target by suggesting it was beef farmers who were holding the industry and its attendant livelihoods to ransom.