Dáil Éireann debate -
Tuesday, 22 Mar 1960

Vol. 180 No. 6

Committee on Finance. - Vote 50—Industry and Commerce.

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

I move:

That a supplementary sum not exceeding £404,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1960, for the Salaries and Expenses of the Office of the Minister for Industry and Commerce, including certain Services administered by that Office, and for payment of certain Subsidies and sundry Grants-in-Aid.

The Supplementary Estimate is for a sum of £404,000 and it is divided into two sums, one of £104,000 and the other of £300,000. The sum of £104,000 is required to recoup the Dundalk Engineering Works Limited for certain ex-gratia payments which they have been authorised to make to certain disemployed workers in the workshop grades, who were employed in the former Great Northern Railways; and the sum of £300,000 is for the purchase by the Minister for Finance of shares in Irish Steel Holdings, Limited.

I shall deal first with the Dundalk Engineering Works. On December 12th, 1958, the House agreed to a Supplementary Estimate—Vote 50— Industry and Commerce—of £50,000 to meet the anticipated cost of recoupment in the year ended 31st March, 1959 of ex-gratia payments to be made by Dundalk Engineering Works Ltd. to former Great Northern Railway Board Shop workers whose employment was interrupted temporarily or permanently and for whom suitable employment could not be found in the group of companies set up to work and develop the former railway works. As explained in detail during the debate on the Supplementary Estimate, these payments are made by the Company in the form of ‘stand-off’ pay in the case of workers temporarily laid off, and in the form of ‘severance’ pay in the case of any of the workers found to be permanently redundant.

Owing to the uncertainties residing in the new developments and to the time occupied in the necessary constructional work and in organising and equipping the various projects, the Company were unable, in the last financial year, to declare any workers permanently redundant and, in fact, no workers had been declared permanently redundant up to 31st March, 1959. Accordingly, the only claims received from the Company for recoupment up to that date were in respect of "stand-off" payments made to temporarily redundant workers. The total amount of these claims up to 31st March, 1959 was £8,606 11 8, which amount was duly paid; the balance of the £50,000, amounting to £41,393 8 4 being surrendered to the Exchequer on 31st March, 1959.

When the Estimates for the year 1959/60 were being prepared the Company were still not in a position to foresee with any reasonable degree of accuracy the future pattern of employment at the Works and, accordingly, only a token provision of £10 in respect of staff redundancies at Dundalk Engineering Works was made in the Vote for the year 1959/60. In the event, claims for reimbursement of "stand-off" payments were submitted by the Company in the financial year 1959/60 as follows:

£3,469 in respect of the period April to August, 1959

and

£4,660 in respect of the period September to December, 1959.

In December 1959 the Company found it necessary to declare 120 workers permanently redundant. The "severance" payments to these men amounted to £60,495. At the end of January 1960, a further thirty workers had to be declared permanently redundant and the Company could see then that a further seventeen workers would become permanently redundant before 31st March, 1960. The amount of "severance" payments which these 47 workers will receive, in accordance with the conditions of the scheme, is £35,000, approximately.

The Company will, therefore, require to be recouped the sum of £103,800 approximately which they will have disbursed in the forms of "stand-off" and "severance payments" in the current financial year, and a supplementary vote of £104,000 is sought for this purpose.

The second sum of £300,000 is for Irish Steel Holdings, Ltd. Irish Steel Holdings Ltd. was incorporated under the Companies Acts in June 1947, to acquire the assets of Irish Steel Ltd. then in liquidation and to maintain the steel works at Haulbowline as a going concern.

The Company has a nominal share capital of £100 of which three shares of £1 have been issued and are held by the Directors.

The Company acquired the assets of Irish Steel Ltd. for £125,000, of which £69,000 was eventually paid to the Exchequer by the Receiver on foot of a guaranteed trade loan to Irish Steel Ltd., and the industry has since been financed by fluctuating bank accommodation, guaranteed in part by the Minister for Finance, by guaranteed loan and by the trading profits of the Company since its inception.

The Company operates open hearth furnaces to produce, largely from native scrap, mild steel ingots and billets which are then converted by rolling into mild steel angles, rounds, flats and squares. Flat and corrugated galvanized sheets are also produced by the Company, the raw material being imported black sheet. The soundness of the industry has been confirmed by the successful progress recorded by the Company over the past ten years. In addition to supplying home market requirements of the products of the Company, a successful, if modest, incursion has been made in the export field, in the face of extremely severe competition.

In March 1958, the Government approved in principle proposals by the Company for a major expansion of its activities through the enlargement of the existing Open Hearth Furnaces, erection of a Blooming or Cogging Mill, the modernisation of the existing Merchant Bar Mill and the completion of the partly erected sheet mill; and the Company was authorised to proceed with the development of its plans on the basis that, if a satisfactory scheme emerged, Government backing would be forthcoming.

The expansion proposals were outlined in the White Paper on economic development which was laid by the Government before each House of the Oireachtas in November, 1958. The White Paper indicated, inter alia, that the primary purpose of the proposed developments was to increase the output and efficiency of the mills and thus reduce production costs and selling prices; the cost of the developments as then provisionally planned was estimated at about £2 million.

The subsequent investigations and negotiations carried through by the Company, with the assistance of consultants, have resulted in proposals which are, in general, an endorsement of the proposals of March 1958, but envisage a greater increase in output, a wider range of products and consequently an increase in capital expenditure. In outline the main proposals are:—

(a) increase in ingot output to 80,000 tons of 30 cwt. ingots per annum by the installation of a new oil-fired furnace of 60 tons capacity, and by improvement of the two existing 37-ton furnaces and by extension of scrap handling and casting facilities;

(b) installation of a new 750 mm. blooming mill and a new 650 mm. large section mill;

(c) re-arrangement and mechanisation of the existing merchant bar mill to improve its rate of working and to enable it to feed a wire rod mill;

(d) installation of a new modern wire rod mill; and

(e) completion of the sheet mill and consequent re-location of the existing galvanizing plant.

The estimated cost of the development proposals is of the order of £3½ millions.

The employment which will be afforded by the expanded steel works is expected to be over 700 persons at peak periods, that is, 200 workers more than at present. In this connection it is necessary to point out that it would be a fallacy to relate the proposed capital investment to the employment of 200 additional workers. In fact the position is that the expenditure is necessary to maintain 700 men in employment.

The Government have approved the development plans as recommended by Irish Steel Holdings Ltd. and have decided that the project should be wholly financed by share capital to be subscribed by the Minister for Finance. Legislation to give effect to this decision is in course of preparation but it will not be possible to enact the necessary legislation before 31st March, 1960. By that date the Company expect that payments estimated at £300,000 will fall to be made in respect of initial instalments to suppliers of new plant and in respect of other items. It is, therefore, necessary to place the Company in funds to meet that expenditure in 1959/60 and a Supplementary Estimate is accordingly submitted to enable payments to be made to the Company in respect of shares to the extent of £300,000 to be taken up by the Minister for Finance.

Mr. Sweetman

With regard to the Dundalk Engineering Works, I think everyone in the House would like to have had from the Minister some indication, not merely in relation to the current year, which he has given, but also in relation to the next year, of what is likely to occur. Is it visualised that during 1960-61 other workers formerly employed by the Great Northern Railway will become redundant and that, in consequence of their redundancy further severance payments will have to be made next year?

I do not quite understand the Minister's figures when he says that in December, 1959, 120 workers were declared permanently redundant at a cost in severance payments of £60,000 odd, whereas in the current quarter 47 workers were so declared redundant at a cost in severance payments of only £35,000. The proportionate figures require some explanation. If it arises because of the difference in the length of the period of service of the workers declared redundant in the respective periods, then we should be told the pattern upon which the men are selected.

The principle of making severance payments by the Exchequer to those who unfortunately have lost their employment as a result of the closing down of the Great Northern Railway is the principle accepted by this House some considerable time ago. Therefore, it is probably only the details with which the House is concerned.

I find some little difficulty in understanding the scope of the Supplementary Estimate for Irish Steel Holdings in relation to what the Minister has said. First of all, may I say I consider the phraseology of the Estimate misleading? The Minister, because of the avocation which he has foresworn and in which he obtained considerably higher remuneration for his trouble than he receives as Minister, will agree with me when I say that "purchase of shares" is not the right phrase. I took it when I saw "purchase of shares" that the shares had already been issued to someone and were being bought. What the Minister has indicated the Minister for Finance is doing is taking up new shares and paying for new shares on allotment which is an entirely different thing from purchase as such. However, that is by the way.

For a considerable number of years discussions have been going on in relation to Irish Steel Holdings. There is the difficulty that the processing plant that is there at the present time suffers both from the fact that the raw material is not available in this country and that we have not got an adequate selling and marketing organisation to dispose of its products outside the country. I am not clear from what the Minister has said—I am not, in fact, enough of a technician to know —whether these various types of mill to which he has referred are the same as the types of mill in relation to which we were making explorations in 1956 and 1957. Our anxiety at that time was to secure a permanent method of supply for raw material in so far as it could not be produced at home and at the same time we hoped by certain linkage to provide outside the country some of the marketing facilities for the products of the mill that were so very necessary.

The difficulty of Irish Steel as a company being able to operate without having all its raw materials natively produced is, of course, an immense one. I do not think—but I speak subject to correction—that in the proposals which are now here, there is anything to improve that situation or, to go back one stage further, in the production of the raw material. I seem to recollect considerable discussions about installing rolling mills so as to do so. I do not know whether a Blooming or a Cogging mill has anything to do with rolling or not and I am sure the Minister did not know; whether he has learned since or not is another matter. However, it is a very difficult situation for an industry of that sort if it is, as it is, virtually entirely dependent on raw material being made available from outside.

Apart from that, one of the greatest difficulties in relation to the export of something like this from Ireland is the fact that we have not got the lines of contact to get the best marketing facilities. The output from a mill of this sort and size, even after this very large sum of money has been spent on it, will hardly be such as to warrant the size of marketing organisation throughout the world that would be necessary adequately to place its output as time goes on.

I appreciate that the expenditure of some of this money will mean that the company will be able to manufacture more efficiently goods that will be used here at home. In so far as these are concerned, the marketing question does not arise so predominantly because there the market will be sealed off and cushioned by tariffs or quotas. In relation to exports, however, it is clear that we must have exports of a substantial degree if this expenditure is to be productive. I should like the Minister to give us some indication, if he can, of the approximate division, a very approximate division, of this expenditure in relation to goods produced for the home market and goods produced for export.

The Minister also mentioned that the effect of this Vote would be that 200 more men could be employed but that we must not, in any circumstances, consider it proper to relate the capital cost to those 200 people; in fact he made it clear that without this extra expenditure the existing company could not carry on. That seems to be rather at variance with the comment the Minister made about the soundness of the project and its progress over the past ten years. But no matter what way we look at it, even if we write off completely every penny put into Haulbowline, every penny put into it right up to date, and take the whole £3½ million as being necessary for the employment of 700 people, it means an investment of £5,000 per man employed. I do not think that is the true way of looking at it.

I can see the Minister's point of view right away, that the true way is not to take 200 additional employees and relate these to £3½ million because that would mean £17,500 per worker. I think it is somewhere in between and I think it means that if we take the money which has already gone into Haulbowline for capital purposes, and the money which is to go in now, it is probably fair enough to say that in this industry it means that we have to invest as capital £10,000 to keep one man in employment.

That is a pretty high investment and it shows the necessity of having substantial capital resources available to the State if industrial expansion is to succeed. I do not think that it should be beyond our capabilities as a nation to produce that capital when it is required and when we can show that it will be productive. There is no use whatever in producing the goods here unless we are able to achieve a satisfactory market for those goods when produced. By a satisfactory market, I mean a market on competitive terms for the home consumer and on competitive terms for export, because without those competitive terms abroad, we shall not be able to sell.

The Minister might have given us some greater indication of the lines on which it is proposed to seek those markets: whether it is intended to have any linkage to ensure that the advice of other marketing organisations in this regard is available; whether it is intended to have any linkage to ensure that openings would in that way be available to the company; and in particular how it is hoped on, shall I say, a percentage basis that the output of the plant will be available for the home market on the one hand and export on the other, and what it is thought will be the likely evaluation of both those two different markets for the product.

Mr. Coburn

This Supplementary Estimate gives me an opportunity to make a few remarks about the Dundalk Engineering Works. I shall concentrate any remarks I have to make on that industry. The introduction of this Estimate redeems, in a way, the pledge or the promise made by the Minister's predecessor, when he said that any compensation paid by the Dundalk Engineering Works to men who might be declared redundant would be reimbursed. When this matter was discussed in this House on a previous occasion, I asked the Minister to make that provision statutory, but for various reasons best known to himself, he refrained from doing so. However, the net effect is the same in that the men are being paid.

While there might be, and indeed has been, criticism by people not connected with this industry when they hear of such comparatively large sums of money being paid to men who were declared redundant, it is only right and just that these men who gave such long service, a lifetime's service, to—shall we call it? —a semi-State body, should be recompensed to some degree just as their C.I.E. fellow workers would be entitled to compensation if they in turn were declared redundant at Inchicore. That is one of the reasons why I stressed, during the debate here, that the men were entitled to compensation, if only for that reason, that C.I.E. workers were entitled to it by law.

There are a large number of men employed at the moment, though not to the maximum extent, of course, and we are all very pleased that such is the case, but it is admitted, and it is obvious that the Dundalk Engineering Works and its subsidiary companies will have an uphill battle to survive and to prosper. I can appreciate that the company is doing its best to absorb as many men as possible into employment and thus relieve the impact which large scale unemployment will have in Dundalk.

It is natural that from time to time there should be fluctuations in the numbers employed because now we have a company which is more or less private and its fortunes will be guided and controlled by the contracts it procures and by the quantity of the products which it can sell. Sometimes it will be doing well, and at other times, not so well, and for that reason the number employed is bound to rise and fall, but, taking the overall picture, we can only express the hope that a steady number of people will be employed.

I should like to refer to the fact that within recent weeks a number of people have been dismissed. The Minister referred to dismissals since December of last year. He mentioned January, and he said that the company envisaged they would need this particular sum to reimburse them to the end of next March, the end of the financial year. As I say, some men have been dismissed quite recently. The number is not large, but it is a bad sign, so far as the men are concerned. As yet, the men who have been dismissed—a number were dismissed last week as I say,—have not been informed, I am told, as to what their position is—whether they are declared to be in the permanently redundant category, or if they will receive stand-off pay as distinct from severance pay.

It would be a good thing if the Minister would use his good offices and urge the Dundalk Engineering Works to tell these men, as soon as possible, what their actual position is with regard to compensation or stand-off pay. A regrettable factor in the recent dismissals is that, in at least two or three cases which I know personally, not only the head of the house, but the son also was dismissed, leaving, in some cases, no income going into the houses of those families. Of course, I realise it is unavoidable that such acute hardship will be caused at times but it is no harm to mention that point here, and to express the hope that as much personal hardship, and family hardship, as possible will be avoided, and if there must be future dismissals, that they will be spread out so as to cause as little hardship as possible.

I should like to ask the Minister if he can say, at this stage, for how long these compensation provisions will be in force. I imagine there is bound to be a time limit. It is hardly possible that the position will be that, if men who are employed at the present time find themselves, say three or four years hence declared redundant, they will be entitled to compensation. It would clear the air if it could be stated if a deadline has been fixed, and it would be interesting to know, if the Minister has the figures, how many men are employed at the present time in the Dundalk Engineering Works. That point was referred to last May and it was stated here by the Minister's predecessor, the Taoiseach, that at that time 860 were employed, leaving approximately 100 to be employed.

As I say, it is the uncertainty of not knowing whether or not a person who is not at work will eventually be declared to be permanently redundant and receive a lump sum, or whether he is to be taken on again that is causing the most upset. Some people have been on stand-off pay for a year and a half, if not more. When this company was set up a couple of years ago, the then Minister for Industry and Commerce stated that it would not be a State body, but a private company, and that the shares would be underwritten by the Industrial Credit Company.

I expressed the opinion, with which the Minister agreed, that it was unlikely that the public generally would be tempted to purchase any of these shares until such time as they ascertained the fortunes of the company, and knew whether or not it would prosper. A sum of £1½ million was mentioned at that time, and the Minister also said that he was not indemnifying that company for all time against loss of money. He also said the company was no different from other private concerns. We all know that other private concerns have varying fortunes. Sometimes they are doing well, and Sometimes they are doing badly, and the Minister said this company would be no different.

Assuming that the Dundalk Engineering Works need more money in the near future, I wonder can the Minister say what reception will they get from the Government. It is quite possible that the company might require additional finances for various reasons. I do not know whether they will or not, but it is possible, and I should like to hear from the Minister as to whether further aid will be given, if sought.

There is another point about which I feel very sore, and which is causing some unrest in the minds of the workers in the Dundalk Engineering Works. The work done there formerly was railway work, of course. I suggested to the Minister that C.I.E. should leave as much work as possible with the Dundalk Engineering Works and he said, on two or three occasions, that an agreement had been made to the effect that the work required to service the remaining section of the old G.N.R. line in the Republic would be done in Dundalk by the Dundalk Engineering Works.

The amount of work being done in their workshops, on contract, for C.I.E. has decreased considerably and is still decreasing. I think there is only one pit occupied in the fitting shop, and there is only one locomotive, whereas there used to be up to 20 in that shop, and I know that other railway work has sharply decreased. I should like to hear the Minister on that point. I do not want to give quotations, but I have copies of the Dáil Debates in which his predecessor is reported as saying that an agreement had been made by C.I.E. with the Dundalk Engineering Works to the effect that a substantial amount of railway work would be done by them. I doubt that very much. As a matter of fact, I know that a substantial amount of work is not being done in Dundalk.

There is not a lot more I wish to say except to reiterate the hopes which I have expressed on previous occasions that the company will eventually succeed. Its greatest asset is the fact that the nature of its work is very varied. It is not confined to the manufacture of one product but has four or five products with which to work. I hope it will prosper. Of course the Minister will understand it would be a tragedy if it did not prosper, because so many men are employed in it. Before the company was set up, about 1,000 people were employed in G.N.R. works. Now I gather approximately 800 are employed. The Minister can readily understand the effect any major setback would have.

I should like to take this opportunity to deprecate and condemn adverse criticism of the company. It is very wrong and very dangerous as well as being bad tactics. We should all appreciate that this company which is a young firm is fighting an uphill battle and has to compete against very old-established competitors.

Mr. Faulkner

It is a matter of regret that it should be necessary to declare any of the workers who worked in the Dundalk Locomotive Works redundant or that there should be any need for a Supplementary Estimate of this kind. Taking into consideration the immense problem which faced the Government in 1957 with regard to the works in Dundalk the wonder is not the number of people who were declared redundant but the exceptionally large number who were kept in employment.

In 1957 the Government faced what appeared to be an almost insoluble problem. We had in the Dundalk locomotive works approximately 1,000 men employed. These men were catering for a very considerable extent of railway known at the time as the G.N.R. all over the whole province of Ulster and in a considerable part of Leinster. In 1951 there was an agreement between the Government here and the Government in the Six Counties that, between them, they would finance losses on this stretch of railway. At the end of 1955, the Six County Government stated they would close down a considerable extent of the line in that area. This immediately meant redundancy in the works in Dundalk.

As well as the effect that the closing of the lines in the Six Counties had on the Works, there was also the effect that the closing of the cross-Border branch lines which served some of the lines in the Twenty-Six County area would have on the network in the Twenty-Six County area. The lines in that area, for example the Irish North, were losing money prior to the closing of the branch lines in the Six Counties. When these feeder lines were closed it meant that lines such as the Irish North would be losing to a colossal extent.

It then became clear that a certain number of these lines would also be closed down. The total effect was that we were faced with a position where it became necessary to find employment for approximately 1,000 men. The effort to find employment for them was more or less in the nature of a unique experiment. I think it was something never faced in this country before and possibly it had not been faced in any other country either.

We did not conduct this experiment from choice but from dire necessity. The problem was tackled by setting up the Dundalk Engineering Works, appointing a Board and giving it the job of trying to solve the problem. It was solved to a considerable extent by buying industries in other countries and taking them over to Dundalk— industries such as Heinkel and Bonzer —and setting up other industries of our own here.

In itself, this did not solve the problem. We had to face the reconstruction of buildings. The buildings of the Dundalk Locomotive Works were not suitable for the new undertakings. They were suitable for locomotive works but were not suitable for the new industries. A very considerable amount of money had to be spent on the reconstruction of the buildings. Workers had to be trained in new techniques. Men had to be trained in management. Markets had to be found.

We are not out of the wood yet. I support Deputy Coburn's plea for less adverse criticism of the company. It is a very difficult project. I feel that if we have full co-operation between the Board, the management and the workers the industries in the Dundalk Engineering Works will be a success. Our main difficulty is to get these industries to pay their way. I feel that when we come to a point when they can pay their way, as I am hopeful they will, then instead of employing the number they originally employed they will be capable of employing more people.

Mr. Larkin

In regard to the Supplementary Estimate for the Dundalk Engineering Works, the Minister need have no fear whatsoever about its reception in this House. The principle that applied to C.I.E. is applicable here. Consequently, there will be no difficulty about voting the money required.

The Minister indicated that for the first two years the company were not in a position to state the number of men who would become permanently redundant. The first statement indicated that 120 employees would become permanently redundant but subsequent statements gave the numbers as 30 and 17. The main question we should like the Minister to deal with is whether any firm estimate of the future employment position can be given. The House would be particularly interested to know whether there is any possibility of the Dundalk Engineering Works maintaining employment at the present level. The Minister has not referred to the future except to express hopes.

With regard to the Supplementary Estimate for Irish Steel Holdings, we have a somewhat different situation. The Minister speaks of the first down payment on estimated substantial future capital expenditure to provide employment not for an additional 200 workers but to maintain existing employment. The House I think is quite prepared to welcome the Government's undertaking in relation to the development of this company. The Minister indicated that not only would the money be required for re-equipment but that there were proposals for the extension of the company's activities. This is a field of development that is overdue in this country. It may lead the way towards development in the engineering field proper.

Up to the present time the companies engaged in the engineering side have to great extent concentrated upon assembling. No real effort has been made to try to develop manufactures in this country. We realise that the situation is not made any easier by the lack of raw materials. Nevertheless, in the overall interests of the country and in the interests of providing employment in the country, development of the steel processing is more than overdue. I expect that the Minister, when the time comes for having the capital issue brought before the House, will be in a position to give some more information.

The Minister referred to the fact that Irish Steel Holdings have been progressing and that this money would be required not only to continue the progress but to re-capitalise and equip on a large scale. In so far as the proposal before us is to maintain our workers in employment and to help to develop this industry in the country, the Estimate, I am sure, will be welcomed by this House.

I trust that capital expenditure of this nature will be made more productive. Capital provided for various enterprises in recent years has not in all cases been used to the best advantage. Deputies will be aware of quite a number of cases where there was fairly extensive capital investment in various parts of the country, some of which was an utter waste not only of the capital itself but of endeavour.

This company has functioned for a number of years now. Generally speaking, it has had substantial support. It is recognised as being a progressive undertaking. In passing this Estimate we should express good wishes for the future development of Irish Steel Holdings.

Mr. J. Lynch

I should like to deal first with the Estimate for the Dundalk Engineering Works. It is obvious, from the remarks of the two Deputies from Louth, that the magnitude of the problem facing the Dundalk Engineering Works Ltd., was very great and that there is, I believe, a reasonable degree of understanding of the problem amongst those immediately concerned, the workmen and the townspeople of Dundalk. There is a very great problem facing the directors of these companies. The problem is not eased by the fact that the lay-out and the equipment in Dundalk on the take over were not by any means ideally suited to the new types of activities that have been undertaken. These factors contribute very greatly to the problems that are facing the management. These are also contributory factors to their inability at this stage to say positively what the pattern of employment will be, whether there will be any more redundancies or whether, in fact, it will be possible to employ in the immediate future a greater number of men.

The figures given by Deputy Coburn are reasonably accurate. That is, that on the take over by Dundalk Engineering Works Ltd., on the 11th January, 1958 there were 967 workers employed. There are now 870 employed in the five companies that constitute the enterprise in Dundalk. That is not, of course, to be taken as a simple reduction of 137. There have been some additions to the staff and there have been some deaths with the result that the number of redundancies exceed the difference between these two figures. However, the redundancies are kept to the minimum and the eventual placing of men on severance pay is only arrived at when it is reasonably certain that there is no prospect of employment for these men in new undertakings.

Deputy Sweetman asked me if I could explain the difference between the allocation of sums for the lay-off of the 120 workers in December and the 47 workers since then. I am afraid I could not give any details except to say that the basis for severance pay is that one month's pay for each complete year of service is given subject to a maximum of 24 months. I can only deduce from that that so far as there is a difference between these two figures that difference is attributable to lesser service of the numbers that constitute the 120 in respect of whom £60,000 odd were paid by way of severance pay.

Mr. Sweetman

If that is the case, then it seems that now people with lesser service are being left off, whereas people with greater service were left off earlier. That seems to be a reversal of what one would normally expect.

Mr. J. Lynch

In this respect the decision to lay-off men must be one for the company itself and they do so, I take it, only in relation to the activities that they undertake and the suitability of the men for these activities. I understand that in some instances they have tried to divert types of skilled labour to new types of skilled labour. They have gone to the extent of suggesting that certain types of skilled men should undertake work of a semi-skilled nature in order to maintain them in employment.

The trade unions objected to such a practice. They have, in fact, urged on me to persuade the company that when a man who is skilled and who has been asked to undertake semi-skilled work objects to doing that work that he be declared redundant and entitled to severance pay. I have communicated with the company, following receipt of the trade unions' points of view, and I feel sure that, not having heard any degree of complaints lately, the company have gone so far as they can to meet the views of the trade unions and the views of the individual workers.

I cannot at this stage give any indication as to whether or not there will be further redundancies and, therefore, the need for further severance payment. I can only say that, realising the magnitude of the task that has been undertaken in Dundalk and realising the type of employment given there,— employment in the production of goods that are largely for export—it is clear that the greatest degree of goodwill must be present between workers and management and also that the greatest possible output must be forthcoming from the workers. The extension of activities in Dundalk will largely depend on the expansion of markets. These markets must be found by and large in foreign countries and therefore it is inevitable that whatever undertakings there are in Dundalk must be highly competitive and that workers of first-class calibre must be employed in them.

I now refer to Irish Steel. Deputy Sweetman asked me if I could give an indication of the quantity of output and the extent to which it would be used on the home market and the extent to which any of it will be available for export. First, to give present production figures, Haulbowline produces at the moment approximately 25,000 tons of sections and about 10,000 tons of galvanised sheets. Most of the galvanised sheets are absorbed in the home market but some proportion of the sectional steel is sold on the export market. The extent of output envisaged in the extended programme will be of the order of 45,000 to 50,000 tons for the home market, and 15,000 to 20,000 tons for export.

Irish Steel have already agents in London on whom they depend largely to promote their exports sales and these agents who are well qualified in this field have said that they could sell at the prices envisaged by Irish Steel up to 40,000 tons per annum on the export market against the 15,000 to 20,000 tons envisaged in the present plans.

I do not think there are any other questions that I can readily answer but as far as Irish Steel is concerned, of course, there will be a very full opportunity for the Dáil to examine in detail the present proposals. Having secured the good will of the House for these two Estimates I think we shall wait until such time as the comprehensive Bill will be before the House for any further details.

Vote put and agreed to.

Supplementary Estimate reported and agreed to.