Dáil Éireann debate -
Thursday, 23 Jul 1959

Vol. 176 No. 13

Committee on Finance. - Undeveloped Areas (Amendment) Bill, 1959—Committee and Final Stages.

Section 1 agreed to.

SECTION 2.

Mr. Russell

I move amendment No. 1:—

In subsection (1) (a), page 2, to delete all words from and including "cannot" in line 23 down to and including "areas" in line 24 and substitute "can be established or developed outside the undeveloped areas (but excluding the County Borough of Dublin, the Borough of Dún Laoghaire and the County of Dublin)".

The purpose of the amendment is clear. I am encouraged to put it down because the Minister mentioned in the discussion on the Second Stage that this Bill is in fact a re-enactment of the Industrial Grants Act, 1956. Section 2 (1) (a) makes the terms under which a potential industrialist can establish an industry outside the undeveloped areas more difficult than they were under the Industrial Grants Act. The industrialist, in addition to complying with the normal conditions for the grant, has to prove that the undertaking cannot be established or developed in the undeveloped areas and furthermore that the undertaking is of exceptional national importance.

In the Industrial Grants Act, 1956, the conditions in Section 2 (1) were as follows:

Whenever the Authority are of opinion that the manufacturer of a particular commodity to a substantial extent in the State would be in the interests of the national economy and would be likely—

(a) to provide employment on a substantial scale, or

(b) to make available in the State substantial quantities of the commodity, or

(c) to provide an opportunity for developing an export trade,

the Authority, if satisfied that financial assistance is necessary to ensure the establishment of an industrial undertaking to manufacture the commodity to a substantial extent and that the undertaking will be of a reasonably permanent nature and will be carried on efficiently, may, on such terms as they think proper, make grants towards the cost of the acquisition, construction and adaptation of the buildings and other works required for the purpose of the undertaking.

It goes on to provide for a maximum sum of £50,000 or two-thirds of the cost of the building, whichever is the lesser. The conditions now being provided are more onerous and take away from the advantages of the Industrial Grants Act, 1956, rather than give an additional advantage to those areas outside the undeveloped areas. Furthermore, if we intend to give assistance to areas outside the undeveloped areas, whatever form that assistance takes, it should be confined to that part of the country outside the city and county of Dublin and the borough of Dun Laoghaire. It is a fairly accurate description to say that the country is divided into the undeveloped areas, which areas covered by the existing Undeveloped Areas Acts, the undeveloped areas, which I regard as being the area outside the undeveloped areas, and the developed areas, which I regard as the city and county of Dublin and the area in that vicinity.

If you apply the same privileges to the entire area outside the undeveloped areas, it will follow logically that manufacturers wishing to set up an industry will tend to come to Dublin where they have tended to come over the years in which industrial development has proceeded. I think I am correct in saying that over the past 25 or 30 years some two-thirds of the industrial development which has taken place in the State has taken place in or near the city of Dublin.

From time to time every public man has paid lip-service to the policy of decentralisation, and every one of us at one time or another has inveighed against the growing size of Dublin. If we are ever to take any practical steps to induce industry to set up away from the City of Dublin, with its many advantages, some special inducement to industrialists to set up industries in the area outside Dublin will have to be included in this Bill or, to put it in another way, potential industrialists will have to be discouraged from setting up their plants near Dublin. Is it in order, Sir, to discuss amendments Nos. 1 and 2 together?

An Ceann Comhairle

The Deputy may discuss the two together.

Mr. Russell

As regards the words "exceptional national importance", that is a condition which was not included in the 1956 Industrial Grants Act. I suggest that may lead to difficulties of interpretation. If an industrialist wished to set up a plant to employ a modest number of people, 25, 30, or 50, it could be turned down on the ground that it was not of exceptional national importance. That condition, which is difficult to interpret, should be excluded altogether.

Minister for Industry and Commerce (Mr. J. Lynch)

I do not propose to accept these two amendments. I think Deputy Russell has already made himself familiar with the terms of the White Paper setting out the programme for economic expansion. I am not suggesting that he has to accept everything that is set forth in that document but paragraph 106 of the White Paper reads:

...the improved facilities which the Industrial Credit Company will be in a position to offer following the increase in the Company's resources should, in general, meet adequately the requirements of industrial promoters. Accordingly it is the intention that grants under the Industrial Grants Act, 1956, will in future be made only in exceptional circumstances and for projects of exceptional importance.

As I said during the course of the Second Stage of the Bill, we should not allow ourselves to drift into the acceptance of the idea that the giving of grants is a sine qua non for further industrial development. It is generally accepted amongst industrialists that one of the greatest difficulties they encounter in setting up new industries or in extending existing ones is the possible lack of capital. I also said that the difference between receiving a grant of, say, £20,000 as against a loan of £20,000 for the capitalisation of any industry is not in the long run a deterrent to the undertaking or the expansion of such a industry. The Industrial Credit Co. has been given increased funds and it has been stated that no sound industrial project will fail for want of the necessary capital assistance.

As far as the first section is concerned, the Deputy seeks to delete the words "cannot be established or developed in the undeveloped areas" and to include the words "can be established or developed outside the undeveloped areas (but excluding the County Borough of Dublin, the Borough of Dun Laoghaire and the County of Dublin)". As the Deputy and the House know, the scope for further industrial expansion to meet home needs is becoming increasingly diminished. If we are to achieve further such expansion, it will be on the lines of getting a market for which we have had hitherto to import the commodity or, alternatively, to produce a commodity that will be capable of export at the quality and at a price which will be competitive. If our purpose is to achieve greater export to create a situation whereby if we have the means of producing a commodity and if the only means of producing it for exporting it competitively would be to produce it in the proximity of Dublin, Dun Laoghaire or in the County of Dublin, I think it would be unsound that we should preclude such a possibility deliberately by legislation.

In order to be competitive, one of the primary factors in the manufacture of such a commodity is accessibility to a port of export. It may be that some undertaking will come to light which it would be impracticable, for one reason or another, to establish in any part of the areas outside the scheduled undeveloped areas other than in the proximity of Dublin.

I share the feeling which Deputy Russell has about the growth of the City of Dublin. It is easy for me since I am not a Dublin man myself. I believe that we have to do all in our power, but within reasonable bounds, to ensure that, in so far as the growth of industry or the expansion of population can take place, it should be in areas outside Dublin. Having regard to the needs of the day when, in order to achieve more industrial production, more employment and, again, in order to help balance our foreign payments and our home income, I think it would be in the long run unwise if we tied our hands to the extent that we should preclude such a possibility by deliberately writing it into our Statutes.

What I have said applies generally to the situation against which Deputy Russell wants to provide. I should also like to say that to exclude the words "cannot be established or developed in the undeveloped areas" would be a serious departure from the policy that has been well established and accepted in this House and throughout the country—that we should endeavour, in so far as we can, to give preference to the undeveloped areas over and above the rest of the country in the matter of giving grants and assistance in the setting up of industries and in the creation otherwise of employment.

I might agree in general with the division that the Deputy created in the country of undeveloped areas, underdeveloped areas and developed areas. There are, perhaps, people in County Dublin who would claim that their area would qualify for inclusion even in the extreme category, the undeveloped category, suggested by Deputy Russell.

As he knows, Dublin is a small area and one need only go, perhaps, west or south west—at any rate 10 miles, 12 miles, or certainly less than 15 miles— and get outside the restrictive scope of the amendments he suggests. Therefore, it might be impracticable from that point of view, apart altogether from the other considerations I have mentioned.

As far as the use of the words "products of exceptional national interests" are concerned, I think the difficulty which he envisages is hardly likely to arise because "products of exceptional national interests" will naturally include projects for the manufacture of goods which we have not been manufacturing hitherto and will also include projects for the manufacture of exportable goods. I believe that other areas in the country, apart from Dublin, and particularly Limerick, with which Deputy Russell, naturally, is particularly concerned, will be equally qualified to come within the existing definition as the bigger ports such as Dublin and Cork. In general, I think that the provisions contained in the original section are not only consistent with the ideals set out in the White Paper but are also consistent with what I think should be sound national policy in the long run. I, therefore, do not propose to accept the amendment.

Mr. Russell

The Minister seems to agree in principle with what I propose through the media of my amendments, particularly in regard to the ever-growing size of Dublin but he does not propose to do anything about it. The whole principle that some part of the country must be assisted at a disadvantage to other parts of the country has already been accepted in the original Undeveloped Areas Act. The mere fact that an arbitrary line has been drawn which includes mainly, I understand, the old congested areas, together with certain areas like West Cork and parts of Kerry, does at least set the precedent which the Minister's predecessor accepted. It is a fact that special consideration was needed for these areas.

I am, however, trying to make the case that special consideration is also required for areas outside the undeveloped areas because, taking the case of Limerick in which I am particularly interested as the Minister said, it is between the devil and the deep blue sea as regards the attractions, in the first instance, of the undeveloped areas and, in the second, of Dublin, the centre of the biggest area of population in the country with its other advantages such as nearness to the British market, its shipping and transport facilities and other inducements to manufacturers to come to Dublin.

As I mentioned when I spoke a few minutes ago, that argument is reinforced by the fact that the vast amount of industrial development up to date has taken place in Dublin, and unless we give some inducements to areas outside the undeveloped areas and away from Dublin, I cannot in any way see that they can ever induce industrialists to set up in places like Limerick and similar centres.

In any event, the more I read this amending Bill the more convinced I am that it is disadvantageous in its terms compared with the Industrial Grants Act and that instead of improving the position of centres outside the undeveloped areas, it is disimproving them. It is making the conditions much more onerous than the Industrial Grants Act which, as far as it went, I thought was quite a good Act except that the grants it gave were confined purely to buildings. I suggested on previous occasions that if that provision were extended to include machinery and equipment, it would be a very good step in the right direction.

However, if the Minister does not accept the amendment, there is nothing more I can do about it, but I should like to express my regret that he has not thought it worth while to accept these amendments which I suggest would tend to take away some of the disadvantages the Minister is creating under a Bill allegedly intended to improve areas, like Limerick, outside the undeveloped areas.

Amendment, by leave, withdrawn.

Mr. Russell

I move amendment No.2:

In subsection (1) (a), page 2, line 27, to delete "exceptional national".

As the Minister said, there is no obligation on me or anyone else to accept the White Paper on Economic Expansion, but I want to know if any legislation coming in, that is allied to this programme, would be automatically accepted by the Minister. I presume he can speak only for himself, and that any suggestion of deviating from that will not be accepted by the Minister. The Minister referred to this programme and said he was just carrying out the Government's programme. Does that mean this automatically wipes out any amendments that might mean any departure from that programme to a minor degree? The word "national" is not used in the White Paper, for instance; the phrase used is "exceptional importance." I take it that we can still put down amendments——

Mr. O'Malley

The White Paper is not a Bible.

Mr. Russell

I take it that if a Deputy puts down an amendment, he will not be faced with the obliterating argument that it is not desirable.

Mr. J. Lynch

I think I qualified my reference to the White Paper, but, on the other hand, as Deputy O'Malley pointed out, the White Paper is not intended as a Bible. It is intended to set out certain principles and lines upon which we ought to go. It has been frequently stated that it will be adapted, restricted or extended as the need arises.

Amendment, by leave, withdrawn.

Mr. Russell

I move amendment No. 3:

In subsection (3), page 3, line 15, to delete "one-third" and substitute "one-half".

The effect of this amendment would be to increase the grant covering the cost of machinery and equipment from one-third to one-half of the cost involved. As I understand this section—the Minister will correct me if I am wrong —it is intended to grant two-thirds of the cost of land, construction and adaptation of the building and other works, and one third of the cost of providing machinery and equipment and the total of the two is not to exceed £250,000. Is that correct?

Mr. J. Lynch

Yes, the total is not to exceed that amount.

Mr. Russell

So, if that is the case, it does not much matter what proportion you provide for building or equipment as long as the total does not exceed £250,000. The reason I make that argument is that, as I said on the previous amendment, I think that as big a grant as possible should be given towards the total cost of machinery and equipment, which, after all, is the thing which creates wealth and provides employment. It is not the buildings which do so. I would suggest that the grant for this should be increased, even if the other grant were to be decreased.

Mr. J. Lynch

The Deputy is aware that under the Industrial Grants Act, no grants were available for equipment and machinery. The grant was limited to building, site development, etc., up to a maximum of £50,000. This Act extends the grants to cover machinery and equipment as well, but it was desirable, and I think it should be insisted upon, that so far as we can maintain a differential between the Undeveloped Areas Act and the Industrial Grants Act, it should be maintained. The Undeveloped Areas Act provides for a maximum grant of the total cost of building and one-half the cost of machinery and equipment. The Industrial Grants Act, when this Bill is passed, will provide for two-thirds of the cost of land, construction and adaptation of buildings and one-third of the cost of machinery.

I think it is desirable that we should maintain that differential in favour of the undeveloped areas. The Deputy will have observed that the overall maximum in connection with any one venture has been increased from £50,000 to £250,000, which is, I think, a very attractive inducement. I feel sure that in the administration of the grants, Foras Tionscal will not be unduly restrictive with regard to the overall amount, if it is proved that machinery and equipment might form a very high part of the total cost. The fact is, they are restricted to one-third but I do not know whether they could adjust the one-third as between the rest of the content of the grant. In any case, I would suggest that the facilities, as they are provided for in this Act, are very reasonable.

Mr. Russell

Do I understand the Minister to say that there is room for adjustment in the figure of one-third?

Mr. J. Lynch

Not in the figure but in the approach to the grant, having regard to the cost of equipment.

Mr. Russell

What does that mean? How do they adjust their approach, if they are not to adjust their conclusions? Perhaps I misinterpreted the Minister, but I understood him to say that in a specific case, if it appeared to Foras Tionscal that the machinery content of the undertaking was unduly large, they might be induced to increase the figure of one-third for the machinery. The Minister gave me that hope, that there was room for manoeuvring, if the machinery cost was very high in proportion to the cost of building.

Mr. J. Lynch

In the event of machinery costing an unduly high proportion of the total cost of the project, it is not impossible that the grant-giving authority could adjust their approach to the project to suit such conditions. I am not suggesting they should raise the one-third limit, but I think they have within the section a reasonable latitude to treat such cases as generously as they can. As the Deputy knows, applicants for grants will not qualify in all cases for the maximum amount, so I think within the limits of the section there is scope for favourable treatment to be given in connection with machinery vis-a-vis the overall amount of the grant.

Mr. Russell

I cannot say that I am any clearer about the position. What I gather is that An Foras Tionscal can alter their approach, but not beyond one-third. If you have a project where the buildings cost £50,000 and the machinery and equipment costs £150,000, that is obviously an exceptional case. In a case like that, where the machinery and equipment are of such enormous value, some extra grant above the one-third should be given— even if it means reducing the grant for the building. Fifty per cent. on both would be a better solution than is set out here.

I agree with the Minister that it is an improvement on the Industrial Grants Act. In fact, I said so when speaking a few minutes ago. From my own knowledge of industry—and I know the Minister would not disagree with me—the cost of modern machinery is far in excess of quite a substantial building. A substantial factory building now could be put up for £20,000, but machinery for any type of light or medium industry could run into £50,000, £60,000 or £100,000.

Mr. J. Lynch

I might explain it better by taking the example which the Deputy has just given—£50,000 being the cost of the buildings and £150,000 the cost of the machinery. In those circumstances, the maximum grant would be two-thirds of the cost of the buildings, that is, about £33,000; and the maximum grant in the case of machinery would be £50,000; making a total of about £80,000. It may be that An Foras Tionscal would not be disposed to give two-thirds of the cost of the buildings, nor the full one-third of the cost of the machinery; but while reducing what they propose to give for the buildings below the two-thirds, they might be inclined, having regard to the cost of machinery, to bring the grant for machinery as near the maximum one-third as possible. I do not know if I have made that clear to the Deputy.

In the example he has given, assuming that £50,000 is the cost of buildings, then £33,000 would be the maximum grant. In any case An Foras Tionscal might say that £10,000 would be sufficient for that. Now, £150,000 is the cost of machinery; £50,000 would be the maximum grant; and if they were inclined to say that £20,000 would be sufficient under ordinary circumstances as a grant towards the machinery, they might under exceptional circumstances be inclined to raise that £20,000 to nearer the one-third limit. That is the degree of flexibility I think they would have under the section, in the exceptional case to which the Deputy refers.

Mr. Russell

The Minister's statement makes it even worse than it was.

Amendment, by leave, withdrawn.

Section 2 agreed to.

SECTION 3.

Mr. Coogan

I move amendment No. 4:—

In subsection (1) to add a new paragraph as follows:—

(c) make grants for the purpose of providing electric current at half the lowest rate obtaining in the State.

I hold that these moneys will not be used unless there is industrialisation and unless industry is a success. I submit that if we are to waste moneys in this country on social welfare it is high time to cry halt. I see this as a way out of helping the undeveloped areas. If you are prepared to give to us with one hand and not get back anything in return, you can give it with the other hand and get something back.

This Bill was intended originally to develop the undeveloped areas, but it has been amended now by the Minister because he realises it has not achieved the purpose for which it was originally set out. The moneys will not be used unless the industry is a success. This amendment will encourage industry to be a success.

Mr. J. Lynch

The section as it stands, as Deputy Coogan has suggested, is an amendment of the original Undeveloped Areas Act to meet a situation that had in fact arisen and certain other situations that might arise. There was in the undeveloped areas an undertaking projected in which the cost of bringing the electricity to the project was, compared with the cost of the project itself, exorbitant; and the promoters, having regard to the colossal capital outlay they would have to incur in the provision of electricity, thought twice about going ahead with the project.

This section as it stands is intended to meet such cases where the cost of provision and installation of electricity in the first instance, that is the capital cost, would be out of proportion and may be a deterrent to the proposers of the project. I think it is wise in general that such assistance should be given initially and irrevocably and should not be given by way of continuing subsidy out of the Exchequer.

The remarks I make now will apply also, perhaps, equally well to the other amendment the Deputy has tabled. A continuing subsidy of such a nature might well make for complacency and possible inefficiency on the part of the firm itself. Therefore, the form of capital assistance in the first instance is certainly very desirable and, in the circumstances, it should be sufficient.

Mr. Coogan

While I agree with the Minister in that respect, would he not consider the fact that the moneys cannot be used unless the industry is a success by using the electric power?

Mr. J. Lynch

That may be so, but I do not think that the cost of electricity is so exorbitant as to mean the difference between the success or failure of an industry, once the initial assistance by way of grant for buildings and equipment has been given or, where the need arises, for the capital outlay involved in bringing electricity to the plant in the first instance. It would be unwise and undesirable that a continuing subsidy in the nature suggested by the Deputy should be given.

Amendment, by leave, withdrawn.

An Leas-Cheann Comhairle

Amendment 5 has been ruled out of order, on the ground that the amendment is outside the scope of the Bill.

Section 3 agreed to.

Sections 4 and 5 agreed to.

SECTION 6.

Mr. J. Lynch

I move amendment 6:

In page 4, to delete subsection (1) and insert the following subsection:—

"(1) The aggregate amount of grants made by the Authority under the Act of 1956 and of grants (other than grants under section 12 of the Principal Act) made by the Board and the Minister under the Undeveloped Areas Act, 1952 and 1957, and this Act and of payments made by the Board and the Minister on foot of guarantees given by the Board and the Minister under this Act shall not exceed ten million pounds."

This amendment is moved in consequence of the change in the title of the Bill. The Bill has been introduced, as Deputies know, under the title "Undeveloped Areas (Amendment) Bill," but it has been generally agreed that it would be more appropriate to style the Bill as the "Industrial Grants Bill." Consequent on the change in the Short Title of the Bill, it is intended to introduce this amendment in order to conform with that change.

Mr. Russell

Does that mean it does not apply to the undeveloped areas?

Mr. J. Lynch

It applies to both. It is the same provision except to take account of the change in the Title of the Bill.

Mr. Lindsay

I take it the "Principal Act" still means the Undeveloped Areas Act, 1952?

Mr. J. Lynch

Yes.

Mr. Dillon

Hold your horses now. Does it?

Mr. J. Lynch

It does.

Mr. Dillon

You have changed the Title. It is now the Industrial Grants Act.

Mr. J. Lynch

I noticed that point myself but I accept the interpretation of the Parliamentary Draftsman on that point.

Mr. Dillon

The "Principal Act" means the Undeveloped Areas Act, 1952.

Mr. Lindsay

It is clear "the Act of 1956" means the Industrial Grants Act, 1956.

Mr. Dillon

Is there any precedent —there is none I have heard of and I have been here a good while—for having an Industrial Grants Act without the word "Amendment" incorporated therein or a statement in the body of the new Bill that "in this Act the Principal Act means the Undeveloped Areas Act"? It is quite understandable that that definition should have appeared in a Bill headed "The Undeveloped Areas (Amendment) Bill," but surely the consideration hitherto has been to call legislation of this kind "the Undeveloped Areas Act and amending Acts"? The last place you expect to find an amending Act of the Undeveloped Areas Act is in an entirely new and apparently unrelated Bill called the Industrial Grants Act. Is there any precedent for that? I never heard of a group of legislation where there is reference to the Principal Act in which the Title of one of the subsidiary Acts is entirely different from that of the Principal Act.

An Leas-Cheann Comhairle

Are we now discussing amendment 7?

Mr. Dillon

No, we are amending amendment 6, which the Minister says is rendered necessary by the change in the Title of the Bill. If you look at section 6, you will find in sub-section (2) a reference to the Principal Act. You will have a new section in section 6, if this is adopted, but that would be read with sub-section (2):—

The aggregate amount of grants under section 12 of the Principal Act and section 3 of the Act of 1956 shall not exceed ten million pounds.

When that section was first drafted, the Title of this Bill was the Undeveloped Areas (Amendment) Bill. When you look at section 1 for the interpretations, you are told that the "Principal Act" means the Undeveloped Areas Act, 1952. That is all fully understandable. Now we are about to change the Title. This will be the Industrial Grants Act. When you look at sub-section (2) of section 6, you find it remains unaltered. It now reads:—

The aggregate amount of grants under section 12 of the Principal Act and section 12 of the Act of 1956 shall not exceed ten million pounds.

But look back to the interpretations in section 1 and you find that what is now called the Industrial Grants Bill, 1959, provides that "the Principal Act" means the Undeveloped Areas Act, 1952. I have never heard of that happening before in my experience in the House. I wonder is it consonant with sound practice? I do not know. Is there any precedent?

Mr. J. Lynch

I do not know. As I said at the outset, I adverted to the point myself, but having regard to the fact that this section provides a blanket provision for the maximum amount of grants to cover the Undeveloped Areas Act and the old Industrial Grants Act, there is some justification for the wording and the section as it is. If the Deputy will refer to the Schedule, he will see that the Industrial Grants Act, 1956, is repealed. Therefore, it would be impracticable to refer to the Industrial Grants Act, 1956, if it has, in fact, been repealed or will be under this Bill, if it passes. I grant that is not a very convincing justification, but having regard to the fact that the Title was changed after the Second Reading, the tidiest and most expeditious way of providing for the change in the Title and the consequent amendments is the way we have provided for. I do not know if there has been a precedent.

Mr. Dillon

The Minister's unfailing courtesy disarms criticism. Nevertheless, I feel a duty to record what I would be tempted to describe in more trenchant terms in other company. I am afraid that this dilemma derives from an expedient which I must mildly deprecate. The plain truth is that it was Deputy Norton who introduced the Industrial Grants Act in the inter-Party Government. That provided a scheme under which industrial grants could be made available on a separate scale outside the Undeveloped Areas Act.

What happened was that when the present Government came to the conclusion that Deputy Norton's plan should be further extended, the awkward dilemma arose: "Does this suggest we are adopting Deputy Norton's policy and the policy of the inter-Party Government?" The only way of repudiating that blasphemous suggestion is that we shall repeal Deputy Norton's Act triumphantly. We will provide grants in all the areas outside the undeveloped areas, but we will call it the Undeveloped Areas (Amendment) Act and the Schedule will repeal Deputy Norton's Act.

Now we have got ourselves in the glorious mess that the text of the Bill makes it essential to go back to the Title of Deputy Norton's Act, and observe the uproarious situation we are now in. We are introducing an Industrial Grants Bill and the Schedule of this Bill declares that we repeal the Industrial Grants Act. All I shall content myself with saying to the Minister until I feel that his hide has grown tougher than it can reasonably be expected to have become in his present office is—tut, tut!

Mr. Lindsay

On the Minister's amendment——

An Leas-Cheann Comhairle

Is the Deputy moving his amendment?

Mr. Lindsay

I thought the Minister's amendment was still under discussion.

An Leas-Cheann Comhairle

It is usual for a Deputy who has tabled an amendment to a Ministerial amendment to move it when he comes to speak on the Minister's amendment.

Mr. Lindsay

I shall do that provided I am allowed to talk about the Minister's amendment.

An Leas-Cheann Comhairle

Both can be discussed together.

Mr. Lindsay

I move the following amendment to amendment No. 6:

In the seventh line, after "pounds", to add: "of which six million pounds shall be reserved for the purposes of the Principal Act."

On the Minister's proposed alteration of the Title of the Bill, I should like him to consider this position: if he were to translate himself back to practice at the Bar, without Parliamentary knowledge and experience, and he was called upon to draft something under the Undeveloped Areas Act, 1952, and anything appertaining thereto, I do not think he would lay his hands very conveniently on this Grants Bill which purports to amend the Act of 1952. Would he consider his consternation if the defence were to file pleadings against him under certain provisions of the Industrial Grants Act, as it will be, and which never sprang to his mind as an extension of the Undeveloped Areas Act of 1952 at all? That may be only a minor point, but nevertheless some confusion is bound to result.

Apart from the reasons already advanced by Deputy Dillon for an alteration of this Title, there is another reason founded on the desire to avoid the accusation that the principle of the Undeveloped Areas Act of 1952 is being disturbed or altered in any way. If the Minister wants this Bill today he would do well to consider the rather confused situation which obtains with regard to the amendment he has moved and which he says is a necessary consequence of the alteration of the title after the Second Reading.

My amendment asks that after the word "pounds" there will be added the words "of which six million pounds shall be reserved for the purposes of the principal Act." Under Section 3 of the Undeveloped Areas Act of 1952, the areas set out for the purpose of benefit under that Act are the Counties of Donegal, Sligo, Leitrim, Roscommon, Mayo, Galway and Kerry; the former rural districts of Ballyvaughan, Ennistymon, Kilrush, Scariff, Tulla and Killadysert; and the former rural districts of Bantry, Castletown, Schull and Skibbereen, in the County of Cork, plus any other area which may be added by order. I understand Ennis was so added some time ago.

Now I would not be adamant on the £6,000,000 provided that some specific sum is reserved for the purposes of the Principal Act. The Minister visited Roscommon recently—on the 16th of this month to be exact. As reported in the Irish Independent of July 17th, talking about the Bill we are now discussing, he said:—

There had been some confused thinking about the purpose of the new Bill. In the first place it contained no new principle. The Industrial Grants Act, which is replaced, was passed by the last Government and extended the availability of grants for industrial undertakings to the rest of the country outside the undeveloped areas.

Be it remembered that the Industrial Grants Act passed by the last Government did not interfere in any way with the scope and working of the Undeveloped Areas Act of 1952.

Secondly, it did not repeal in any way the existing Undeveloped Areas Acts, but, on the contrary, it increased the overall amount of moneys available for grants, and made better provision for installation of electric power where the E.S.B. would find that the capital cost of making electricity available to an undertaking in these areas was not economic.

Under the heading of "Grant Facilities" the Minister said:—

Thirdly, it continued the preferential grant facilities for industrialisation in the West.

On my reading of this Bill—I raised this point on Second Reading—there is nothing to stop the authority, the Board, the Government, the Minister, or anybody concerned, from making the whole of this £10,000,000 available to people who satisfy them—the method of satisfaction is one which I query—that they could place their industries anywhere near the larger centres of population, such as Dublin, Cork and elsewhere.

In this amendment I want to preserve the principle of preferential treatment for the areas already set out in the Principal Act by reserving a specific sum for those areas. On the same day, 16th of this month, that the Minister gave utterance to what I have already quoted at a luncheon in Roscommon celebrating the opening of a new factory, the Bishop of Elphin, Most Rev. Dr. Hanley, also spoke. He took the view that this amending Bill is taking away whatever advantages there were before:

If the flight from the West is to be arrested this disadvantage must at least be neutralised.

He was talking of the disadvantage of setting up factories in the West.

With a view to securing this objective the Undeveloped Areas Act was passed in 1952, but apparently it did not go far enough. It is, therefore, a matter of grave concern to hear that it is about to be amended in such a way that it will be of no benefit to the West.

I might say that not one line of that appeared in the Irish Press, the Government organ.

"Let us hope," said the Bishop, "that instead of the amendment contemplated another will be substituted which will provide further attractions sufficient to neutralise the disadvantage under which we labour, and, at the same time, achieve the objective of the Act."

Let me say at once that I had tabled this amendment before I read that. Let me say, secondly, that no part of the diocese of Elphin is in my constituency. It is to ensure the preservation of the preferential treatment which the Minister told the people of Roscommon will be preserved that I am asking that £6,000,000 of the £10,000,000 be reserved for the purposes of the Principal Act. I would be prepared, as an earnest of the Minister's goodwill and of the Government's goodwill, to accept a lesser figure by way of reservation.

Mr. J. Lynch

To take Deputy Dillon's point first, the Deputy will remember I announced on Second Reading that I thought the Title, Undeveloped Areas (Amendment) Bill, inappropriate since grants would be made available under it to parts of the country outside the undeveloped areas scheduled. I thought for that reason it would be advisable to amend the title. From the point of view of draftsmanship it might be tidier perhaps to leave the title as it is. I do not know what was behind the original title. As the Deputy knows, I only came into the Department long after it had been drafted. I doubt if there was any intention of changing the title for the sake of registering disapproval of something that had been done by the previous Government.

With regard to Deputy Lindsay's amendment, the section provides an overall upper limit to funds available for grants under the Undeveloped Areas Act and under the Industrial Grants Act. There is, it is true, no subdivision as between the limit for the one Act as against the other. The existing limits, as the House knows, were £4,000,000 under the Undeveloped Areas Act and £2,000,000 under the Industrial Grants Act. I think I could allay any fears Deputy Lindsay may have if I refer him to the expenditure under the Undeveloped Areas Act since its introduction. Between expenditure and amounts of grants approved but not yet paid over, the total sum is £2,293,490 and that would represent something less than an average of £500,000 a year for each of the six years or so that the Undeveloped Areas Act has been in operation.

I do not know whether the amount of industrialisation in the western undeveloped areas will increase. I hope it does but I doubt if it will increase to an extent that it would prevent the overall limit of £10,000,000 being applied fairly between the two areas or that the increase in grants given to the areas outside the undeveloped areas would increase either in that fashion. It is anticipated that the £10,000,000 will cover whatever payments by way of grants will have to be made up to the 31st December, 1963, which is the date up to which this Bill will continue to be law if it is passed. I do not think there is any danger that any projects within the undeveloped areas will suffer by reason of lack of funds in that period and if, in fact, the fund is exhausted within that period the Government, I am sure, will come back to the House and seek more moneys for grant purposes in the undeveloped areas. I think I remember Deputy Norton, when he was Minister for Industry and Commerce, having to come before the House for a similar purpose and there was no opposition then from our side as, I am sure, there would be no opposition if the situation had been reversed.

In all the circumstances, there is every reason why Deputy Lindsay's fears should be allayed. I think there would be no danger of grants in relation to one area or the other, and certainly in relation to the undeveloped areas, suffering by reason of exhaustion of funds before December, 1963, and, even in that event, I think adequate provision can be made for it.

I would urge that the drafting amendment, even though, perhaps, it offends Deputy Dillon's sense of draftsmanship, be accepted as being reasonable and, certainly, reasonably capable of interpretation even in the event envisaged by Deputy Lindsay.

Mr. Lindsay

Will the Minister not concede that the position might be this, as a result of this Bill? Assume for one moment that there are people outside this country and in the country willing to invest money and to set up industries, provided they do not have to go into the congested areas. Assume they see now that it is possible for them to operate in Dublin or within easy reach of it, and that they come in such numbers—I would like to see them come—and with projects of such a size, that they could satisfy the Board, pursuant to the provisions of Section 2, that they are going to the right places, the whole of the £10,000,000 could be exhausted in that way, leaving the areas scheduled in the Principal Act entirely out of consideration. Is it not possible? It may not be probable but is is not possible?

Mr. J. Lynch

I would not deny that it is possible but it is hardly likely.

Mr. Lindsay

I should like it to be probable and I am sure the Minister would, also, but, in that event, does not the Minister think that there should be some sum reserved? I want to put in this way—there could be industrialists coming in who would like to come nearer to Dublin or Cork or to some shipping centre. They might not like to go to Galway but could be persuaded to go to Galway by being given greater facility from the Board. It is for that reason that a sum should be set aside for the areas mentioned in the Principal Act, that the Board could use its influence and even bring pressure to bear on a prospective investor to go to the area that it was designed to serve and to benefit under the Principal Act. That is my reasoning. I think the Minister has conceded that my fear is a genuine one in this respect, that it is only a transitory period until the West will be probably abandoned, not necessarily by the Government but by prospective investtors who can take advantage of this piece of legislation.

Mr. J. Lynch

It is well known that when people enquire about grant or loan facilities available for the establishment of industries, they are generally directed to the undeveloped areas in the first instance. It is made very clear to them that, should they go to the undeveloped areas, the amount available by way of grant is more favourable than would be the case if they started their industries elsewhere. That differential will continue. The amount of the grant under the Undeveloped Areas Act, contained in this Bill, is full cost of buildings and development of sites, half cost of machinery. Under the Industrial Grants Act, it is two-thirds of the cost of building and one-third of the cost of machinery. There is that differential and that preference in favour of the undeveloped areas but I want to assure the Deputy, in the first instance, that in so far as An Foras Tionscal will operate, they will see that the funds will not be gobbled up by people who do not desire to go to the undeveloped areas. Secondly, I should like to assure him that, as far as I am concerned, if I saw a trend developing that there was a danger, by reason of there being no upper limit in respect of each of the Acts specified in legislation, I would come back to the House and seek such protection as he suggests, but I do not think the situation is likely to arise.

Mr. Lindsay

The Minister could protect himself now by accepting this amendment, even if he included a lesser figure.

Mr. Dillon

There is this additional point of view. After this Bill leaves this House, its administration becomes a matter for Foras Tionscal and we cease to have a daily contact with what is happening. We cannot escape from the expressed declaration of the Taoiseach on the Second Stage of this Bill that the effect of this amending Bill, in his own words, is to draw the people out of the undeveloped areas to the industries rather than to encourage the industries to go into the undeveloped areas to the people. Those are his own words.

Deputy Lindsay makes the case, that being faced with that declaration, that if that tendency predominates and that you have available £10,000,000, £7,000,000 of which is going to industrial projects outside the undeveloped areas, before things have reached that stage the Minister for Industry and Commerce will be forced to come back to Dáil Eireann and tell the House that all the money available for areas outside the undeveloped areas is gone, and that he must have more money. Whereupon it would be open to the House to say: "Have you abandoned the undeveloped areas altogether? We gave you £6,000,000 for the undeveloped areas and £4,000,000 for the others. You are now back in the Dáil saying that you have oceans of money for the undeveloped areas, because nobody is applying for it, but you have run out of money for industrial projects in the outside areas which confirms us in the belief that the new policy of drawing the people out of the undeveloped areas to Dublin, Cork, Limerick and Waterford is in full career."

I think the Dáil has lost all realisation of what we are doing. I look at the Fianna Fáil Deputy from Sligo smiling blandly there and I remember the hoots of joy with which he greeted the Undeveloped Areas Act.

Mr. Gilbride

Does the Deputy remember calling it Fianna Fáil slush money?

Mr. Dillon

Yes, and I am completely vindicated. Fianna Fáil has now got back the votes and it does not matter any longer. Did the Deputy not hear the Taoiseach say that the purpose of the Bill is to draw the people out of the undeveloped areas to the industries in other areas?

Mr. J. Lynch

He said: "The effect of it."

Mr. Dillon

The Minister for Industry and Commerce intervenes to correct me and say that the Taoiseach did not say the purpose of the Bill would be to do that but that what he did say was that the effect of the Bill would be to do it. The effect of the Bill will be to draw the people out of Sligo, Galway, Clare and Roscommon into the cities.

Mr. Killilea

He never made that statement.

Mr. Gilbride

He said that might be the effect of it.

Mr. Dillon

The Minister corrects me to say that he did say it. Deputy Killilea says that he did not say it and the Deputy from Sligo that it would have that effect.

Mr. J. Lynch

What the Taoiseach did say was that it could have that effect.

Mr. Lindsay

Yes. He said that was one of the effects it would have.

Mr. Dillon

We now have Fianna Fáil Deputies divided into three schools of thought and the obiter dicta of the present Taoiseach are being parsed and defined to get their real meaning. Deputy Killilea says that the words were never spoken at all. Deputy Gilbride says that they were spoken but that he did not mean what he said. The Minister for Industry and Commerce says that the words were spoken but that what the Taoiseach meant was that one of the effects of this legislation might be to draw the people out of the undeveloped areas. Out of all this, one thing is certain and that is that the official record of this House says that the Taoiseach expressed the opinion that the result of this Bill, when operated, could be to draw the people out of the Gaeltacht to industries situated in Dublin, Cork, Limerick and Waterford.

I understand that our objective and the purpose of Dáil Éireann is to encourage industry to be located near the homes of the people in the congested areas in the west of Ireland. Does the Deputy realise now that such is not going to be the case?

Mr. Gilbride

I shall speak myself in a few minutes.

Mr. Dillon

I shall sit down and let the Deputy speak.

Mr. Gilbride

I am delighted that Deputy Dillon has been converted to the Undeveloped Areas Act of 1952. When that Act was going through this House, he described it as Fianna Fáil slush money. That Act has not been in operation for five years and the Minister for Industry and Commerce has told us that the amount spent under it is about £2,000,000. The Government, in their wisdom, see that they have not been able to attract people to invest in the undeveloped areas and, as a result, the ceiling of £4,000,000 or £5,000,000 which was fixed in the Act has not been reached and all the money has not been spent.

The Government now sees that it might be possible to bring some big industries into the country, industries that would not be prepared to go into the undeveloped areas, so they have brought in this Bill to attract those industries into the country. Is there anything in the world wrong with that? If we cannot get people to invest in the undeveloped areas I see nothing wrong in trying to get people to set up industries in some other part of the country so that the people of the west will have to go there. There is no need for the Minister for Industry and Commerce to have to apologise for that. The Taoiseach said that this Bill could have that effect.

Mr. Dillon

I doubt if Deputy Gilbride knew, until he stood up, that he had become converted to the fact that the purpose of this Bill is that we should lead the people out of the West of Ireland to find employment in other areas, that we should abandon the idea of trying to establish industries in the West of Ireland.

Mr. Gilbride

No.

Mr. Dillon

There was nothing to prevent the Minister from increasing the grants under the Industrial Grants Act if, at the same time, he increased the grants available under the Undeveloped Areas Act, and kept the two systems of grants at the same level in order to induce people to go to the undeveloped areas. The differential between the grants available outside and inside the undeveloped areas has been substantially reduced. There is no use in Deputy Gilbride shaking his head. That is the fact, and it is that fact which will operate to draw people out of the undeveloped areas into the cities and towns of the Eastern counties of Ireland.

Mr. Gilbride

They have been there for the last six years and what has happened?

Mr. Dillon

Deputy Gilbride says they were there for the last six years and people did not avail of them. As a matter of fact, I think there were several grants in Sligo, but let the people go, he says. He is throwing his hat at it. I have already declared my interest in this matter as it affects my constituency. This Bill is an advantage to my constituency but it is going to be a very real disadvantage to the congested areas in the West of Ireland. It is wrong for this House to proceed to the enactment of this measure without a full realisation of what it is doing.

The principal value of Deputy Lindsay's amendment, in the light of what the Minister for Industry and Commerce has said, is that the amendment would impose a duty on the Minister to come back to this House if, as I believe will be the case, the bulk of the grants hereafter bespoken will be in respect of enterprises outside the undeveloped areas. If that is the case, I think it would be a good thing to put the Minister in a position to come back to the Dáil and tell the Dáil about it. That purpose would be effected by Deputy Lindsay's amendment, which I hope the Minister will accept.

Mr. Lindsay

For the purposes of the record arising here from the discussion on this amendment, vis-a-vis the Taoiseach's interjection in the debate on Second Reading, I might state that this is the position as shown in Volume 176, No. 5, Column 740 of the Official Report for Tuesday, 7th July. At that Column Deputy Corish is reported as saying:—

"I think it would be a far better thing to encourage the people from the undeveloped areas to come to other parts of Ireland where industries can be established and established properly. I have nothing to say against people from Mayo and Galway coming to other parts of the country.

Mr. Dillon: Did I understand the Taoiseach to nod his assent to that proposition?

The Taoiseach: One of the effects of this Bill will be to do that."

Does Deputy Killilea still deny that the Taoiseach said it?

Mr. Killilea

That is not the statement you made and exaggerated.

Mr. Dillon

May I draw the attention of the House to the fact that the Taoiseach was in course of operating a very well-known, ancient, political device, a silent nod of assent which he did not wish to have recorded in the Official Report? I invited him to give verbal expression to his silent nod, which he very reluctantly did.

Mr. J. Lynch

He did immediately.

Mr. Dillon

But does that make any difference to Deputy Gilbride or Deputy Killilea? If he said that he cannot have meant it—is that not their case? That is Deputy Killilea's case for consumption in Galway, and it is now Deputy Gilbride's case for consumption in Sligo but, unfortunately, the printed word contradicts Deputy Gilbride and Deputy Killilea and, sooner or later, that will catch up with them.

Mr. Gilbride

I am glad it is not slush money anyway.

Mr. Killilea

He is trying to justify that slush money.

An Leas-Cheann Comhairle

Is the amendment to Amendment 6 withdrawn?

Mr. Lindsay

No.

Question: "That the proposed words be there inserted"—put and declared lost.

Mr. Killilea

Why did you not vote?

Mr. Dillon

Because you have a clear majority in the Dáil. You can do what you damn well please and you are doing it.

Mr. Killilea

And we will have a bigger majority to-night.

Mr. Dillon

Maybe. To-morrow is a new day.

Amendment No. 6 put and agreed to.

Section 6, as amended, put and agreed to.

Sections 7 to 14 inclusive, put and agreed to.

SECTION 15.

Mr. J. Lynch

I move amendment No. 7:

In page 5, lines 43 and 44, to delete "Undeveloped Areas (Amendment) Act" and substitute "Industrial Grants Act"

This is an amendment also consequential on the change in the Title. The purpose of it is to delete subsection 2 of Section 15 as it stands.

Mr. Dillon

No, it is in subsection 1.

Mr. J. Lynch

No. Subsection 2.

Mr. Dillon

Lines 43 and 44—that is subsection 1.

Mr. J. Lynch

I am sorry. I have two amendments and I took them in the wrong order.

Mr. Dillon

Are you taking amendments Nos. 7 and 8 together?

An Leas-Cheann Comhairle

Amendment No. 9 is also related. If the House wishes to take the three amendments together that can be done.

Mr. Dillon

Amendment No. 9 is the Long Title. If you take out lines 45 and 46 you are simply—though you have in the definition article the principal Act defined as the Undeveloped Areas Act—leaving no codified form of reference for the series of Acts at all. That is if you take out subsection (2) altogether. I suppose it is a drafting matter. You had better clear it up yourselves but you have made a haymes of it.

Amendment agreed to.

Mr. J. Lynch

I move amendment No. 8:—

In page 5, to delete lines 45 and 46.

Amendment agreed to.

Section 15, as amended, agreed to.

Schedule agreed to.

TITLE.

Mr. J. Lynch

I move amendment No. 9:—

In page 2, to delete the Long Title and insert the following Long Title:

"An Act to provide for the making of grants in aid of industrial development in areas other than areas to which the Undeveloped Areas Acts, 1952 and 1957, apply, to amend those Acts, and to provide for other matters connected with the matters aforesaid."

The amendment is self-explanatory.

Mr. Dillon

May I direct Deputy Gilbride's attention to the fact that the Title now is: "An Act to provide for the making of grants in aid of industrial development in areas other than areas to which the Undeveloped Areas Acts, 1952 and 1957, apply..."?

Mr. Gilbride

The Undeveloped Areas Act is still there and the money is still there.

Mr. Dillon

I just want Deputy Gilbride to dwell on that.

Amendment agreed to.

Title, as amended, agreed to.

Bill reported with amendments.

Agreed to take remaining Stages today.

Bill received for final consideration and passed.

An Leas-Cheann Comhairle

This is a Money Bill within the meaning of Article 22 of the Constitution.