I move: "That the Bill be now read a second time." This is a measure designed to confer the legal powers required to carry out the experimental development of the industrial alcohol industry, of which the Dáil has already approved and for which the necessary funds have been voted. The actual provision of the necessary money for the erection of distilleries, the purchase of plant and the carrying on of the operations of distilling industrial alcohol is not sufficient, because the Department has not got the legal authority required to enable it to enter into agreements and to undertake commercial trading in the refined spirit and, consequently, it is necessary to have a measure conferring these powers on the Minister for Industry and Commerce. It is also necessary, of course, in accordance with the general scheme, to take power to require, compulsorily, an admixture of industrial alcohol with petrol for sale as motor fuel in whatever proportion may be considered necessary, having regard to the consumption of petrol and the quantity of industrial alcohol available and at whatever price may be fixed, having regard to the cost of production. One part of this Bill gives the necessary powers in this regard.
When I outlined the general nature of the scheme on the occasion of the adoption of the Estimate I stated that it was intended to erect a group of five distilleries with one refinery plant and that the group would be located in the north-eastern corner of the Saorstát: in North Louth and in the adjoining counties. Since then, however, certain investigations have been carried out, and as a result of these investigations a modification of that proposal is under consideration. It may be that, instead of proceeding with the original intention of erecting five distilleries and a refinery in the North Louth area, the refinery will be established in Dublin, which is the centre of railway communication, and the distilleries located partly in Louth and Monaghan and partly in County Donegal. The Bill, of course, does not affect that position, but I think it is desirable that Deputies should be so informed. That alteration of the plan would permit of an extension of the industry later, if it were so decided, by individual distilleries, rather than by groups of five, as was originally contemplated. The refinery which it is proposed to establish in Dublin gives very little employment and its transfer from the area originally intended to the City of Dublin does not affect the interests of that area to any extent. The industry is one which does not, in any event, give a very large amount of employment, the benefits which it is expected to confer by its establishment being enjoyed mainly by the agricultural community that supply the materials for it.
The Bill empowers the Minister for Industry and Commerce to undertake the manufacture, distillation and sale of industrial alcohol. The Bill, as it stands at the moment, is slightly defective in so far as it does not contain any definition of industrial alcohol. That will be remedied by an amendment on the Committee Stage. It will define industrial alcohol as "alcohol which is of a strength not less than 50 degrees over proof whether de-natured or not." Section 4 of the Bill is the operative section in respect of that part of it. It enables the Minister to do all things necessary to construct and operate these distilleries: that is, to acquire land, to purchase materials for the buildings, to purchase or hire machinery, to enter into contracts for the supply of raw materials, to employ persons, to sell the spirit, and to do anything else necessary for the purpose of carrying on the distilleries as commercial undertakings. Sub-section (2) of the section authorises the Minister to enter into an agreement with persons who are experts in relation to this industry for the purpose of securing their advice and assistance to the preparation of plans, the preparation of contract forms and in the examination of tenders, the operation of the distilleries, the appointment of a manager and of biological engineers, including guarantees by the contractors in respect of the performance of the distilleries erected and the payment by them of penalties in the event of the distilleries having a performance less efficient than the plans contemplate, and so forth. The various matters, which may be the subject of such an agreement, are set out in sub-section (2) of Section 4. There is provision also for the payment to the persons with whom a contract is made of whatever fees may be agreed on in return for their services.
Part III of the Bill provides special powers for the compulsory acquisition of lands and for the construction and operation of transport works. That part of the Bill is similar to sections in corresponding measures, such as the Act under which the beet sugar industry is now being developed. Part IV of the Bill is the part which provides for the compulsory purchase of industrial alcohol by importers and refiners and is, I think, in accordance with the general description I have already given of it. The operation of that part of the Bill will, of course, depend on a number of factors. There is a market, admittedly a limited market, available here for industrial alcohol as such. It is possible that the market may be expanded with the development of other industries in the country, but it is intended that a large proportion of the industrial alcohol to be distilled in these experimental plants will have to be disposed of as motor fuel, mixed with petrol in the same manner that industrial alcohol is mixed with petrol in a very large number of Continental countries at the present time.
Part V of the Bill provides for the prohibition of the manufacture of industrial alcohol by any person except under licence. There is included under that part also provisions for the establishment of an industrial alcohol advisory board. Although the Bill as drafted confers the powers of establishing and operating those distilleries upon the Minister for Industry and Commerce, it is intended that those powers will be exercised on his behalf by the advisory board. The legal authority and the legal responsibility will rest with the Minister, but the actual work will be performed by the board, which will consist of certain officers of the Department of Industry and Commerce, representatives of the Department of Agriculture, and outside technical experts. There is power taken in that part of the Bill also for the sale of land, and for the sale of the goodwill, stock-in-trade, and other assets of the undertaking, if that should be necessary; for the laying before each House of the Oireachtas of a report on the working of the industry, for the payment of expenses in connection with the operation and establishment of the industry, and the disposal of the moneys received from the sale of industrial alcohol and any by-products.
I do not know if it is necessary at this stage to re-state the considerations which prompted the Government to undertake this experiment. We are aware that in a number of European countries the Governments have adopted various measures requiring the compulsory mixture of home-distilled industrial alcohol with imported petrol for transport fuel purposes, in order to provide an additional market for the agricultural products of those countries. The position was examined here, and it was at first considered undesirable to proceed with the development of the industry on any large scale, because it did not seem, judging by the experience of Continental countries, that industrial alcohol could be produced here at a price which would permit of its incorporation with petrol for motor fuel purposes except by a considerable increase in the cost of motor fuel, or a considerable loss of revenue to the State. As examination of the problem proceeded, however, it became clear that there were unknown factors in the situation, and that those might well operate so as to reduce considerably the price at which industrial alcohol could be distilled here, as compared with the price at which it was actually being produced in other countries. Climatic and other conditions prevailing here seemed to indicate that it might be possible to establish the industry here under conditions which would produce a more favourable result than had been produced elsewhere. Those matters were, of course, matters of assumption and speculation. No one could say with certainty what the results would be unless and until some experimental development had taken place. We decided that in view of the speculative nature of the enterprise it was desirable that it should be undertaken by the State, rather than that we should seek to enter into an arrangement for the subsiding of some commercial firm to carry out the experiment for us.
When I say that the development is an experimental development, it is, of course, clear that there are many factors in relation to the experiment which are well known. Potatoes are the raw material of this industry as we propose to establish it. It is known that we can grow potatoes here with certain qualities and with a certain yield per acre for different varieties. The actual process of making industrial alcohol from potatoes is, of course, in no way experimental. It is being done in many parts of the world at the present time. The matters upon which we hope to gain information as a result of this experiment are firstly, the possibility of developing here a type of potato with a very high starch content, which would permit of a reduction in the costs of the raw material to the distillers, while at the same time giving an adequate return to the growers; secondly, the possibility of reducing manufacturing costs by reason of the fact that a longer campaign period may be worked in this country than is possible in most European countries. There are certain other matters also upon which it is possible to form at least the hope that the difficulties which had been experienced in relation to this industry in other countries will be less formidable for us, and that we may be able to get down to a commercial basis in relation to this industry. As this experimental development stands there is not likely to be anything like a substantial increase in transport fuel costs in consequence of the compulsory admixture of the comparatively very small quantity of industrial alcohol that will be available in relation to the quantity of petrol used. Also by reason of the fact that this development is being financed in a particular way the only items of cost that will come into account in determining the selling price will be those that are absolutely essential. The position in respect of the transport users and the price they will have to pay for their fuel will not be materially changed as a result of this development, but on the experience gained from this development we hope to be able to determine whether or not it would be wise from every point of view to proceed with a much wider development of the industry than is now contemplated. I do not know if there is any other factor to which I need make reference at this stage. The matter has already been before the Dáil both on the occasion of the Supplementary Estimate at the conclusion of the last financial year, and on the main Estimate for the present year. In consequence of the adoption of that main Estimate by the Dáil a considerable amount of work has been done in the preparation of plans, the examination of sites and the preparation of information in relation to the whole matter, but the actual work of proceeding with the development of the industry cannot be undertaken until the legal powers proposed to be conferred by this Bill are actually available to the Department.
