Skip to main content
Normal View

Dáil Éireann debate -
Thursday, 2 Mar 1961

Vol. 186 No. 8

Committee on Finance. - Vote 47—Industry and Commerce.

I move:

That a supplementary sum not exceeding £10 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1961, 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 sundry Grants-in-Aid.

This Estimate is necessary to cover the anticipated cost of recoupment in the year ending on 31st March, 1961, of ex gratia payments by Dundalk Engineering Works, Ltd., to former Great Northern Railway Board employees at the Board's Dundalk workshops for whom suitable employment could not be found in the group of companies set up to develop the Dundalk Works. On previous occasions, the House agreed to the provision of money required for this purpose as workers became redundant.

In the financial year 1958/59, a sum of £50,000 was voted, but actual expenditure was only £8,607, the balance being surrendered to the Exchequer. In the year 1959/60, a total of £104,010 was voted, and expenditure came to £96,597. For the current year, owing to the impossibility at the time the Estimates were being prepared of anticipating what sum would be required, a token provision of £10 was made. It can now be estimated that a sum of £190,000 will be required to meet payments under the scheme, which it is intended to terminate, if at all possible, before the end of the present financial year. It it thus estimated that total payments under the ex gratia payments scheme will come to about £295,000.

The amount now required can be met in full from savings on a provision of £1,200,000 made by way of Supplementary Estimate in July, 1960, for the purchase of shares in Irish Steel Holdings Ltd. under a new Subhead SS. Accordingly, the Estimate now submitted to the House provides only for a net sum of £10.

Deputies will be aware from the debate on the previous Estimates for this service that at the outset a great deal of uncertainty prevailed in regard to the prospects of ultimately establishing as viable concerns the group of industries created at Dundalk. It was necessary, in order to avoid the risk of making unjustified payments, to withhold declarations of redundancy until it was reasonably certain that suitable employment would not arise.

Between December, 1959 and 31st March, 1960, 167 workers were declared permanently redundant, a further 116 in August, 1960 and 218 more are now seen by the Dundalk companies to be in the same case.

The principals of the companies are doing everything in their power to find new economic production openings, to safeguard the continuity of employment of the remaining workers. Deputies will appreciate, however, that this group of companies must operate on ordinary commercial principles and that they cannot afford to employ workers unless there is genuine employment available for them, which, in turn, depends on the companies' ability to place their products on remunerative markets. In this respect the position of the workers will be no different from the position of workers engaged in any form of industrial activity.

I recommend that the House should approve of this Supplementary Estimate.

We approve of the proposals contained in this Supplementary Estimate so as to provide for the personnel who were found redundant arising out of the termination of work in the Dundalk Engineering Works. I note, however, from the figures the Minister gave that to date a total of 500 workers have become redundant. I should be glad if the Minister could say how many workers were originally employed there and whether he can indicate if the companies concerned have any view as to the possible numbers who in the future will become redundant.

We are all most anxious that the work which was undertaken there by the establishment of new factories should be a success but I think that I am bound to say that one, if not more, of these undertakings which were established looked at the very beginning to have little prospect of profitable operation and while it was necessary that every effort should be made to provide employment and, indeed, to stretch to the limit the resources available in order to provide work there for those who had been disemployed, nevertheless, the establishment of an undertaking which, in view of the general trend and experience elsewhere, had little prospect of economic expansion or, indeed, economic survival, was of itself not conducive to bright hopes for its future. I, therefore, should be glad to hear from the Minister, if it is possible for him to do so, what estimates are available as to future employment there and what are the economic prospects of the companies concerned.

We know from previous discussions and from information on the situation there that many difficulties were encountered, not the least of these being internal difficulties. Nobody has any desire to discuss these situations in order to create difficulties or to aggravate an existing problem, but it is significant, I think, that in the past 12 months or so over 200 workers have become redundant. It is a fact, as I say, that a total of 500 persons have become redundant during the past two years. Undoubtedly, the prospect for all concerned is one that must give rise to anxiety. The fact that the House has accepted responsibility for making funds available indicates the concern of members of the Dáil about the situation. Their anxiety has been expressed in the provision of this money so that employment may be provided. I should be glad if the Minister would indicate the situation as envisaged in the light of information available to him.

All of us, of course, without question, accept the principle already laid down in the House that moneys should be made available, due to the necessity for these redundancy payments. I want to follow a slightly different line from that taken by Deputy Cosgrave. At the beginning, when these various factories were set up in Dundalk, I understood the first intention was that they would be set up for the export market, that they would not be for and were not intended to cater for, the home market in any way. Certainly those concerns in other parts of the country which engage in the same type of business were led so to believe. That went by the board very quickly and far from confining themselves to the export market alone, the concerns, in their desire to develop, came into the home market very fully.

There is not the slightest use anybody saying to me that these are private concerns and therefore cannot be discussed. They are concerns initiated by the Government and concerns in which no private capital of any consequence whatever is invested. They are concerns which exist solely because of the public moneys which have been advanced to the parent company, and, through the parent company, to the other companies, by the Industrial Credit Company which gets its funds by subvention from the Exchequer. They are public funds without any possible shadow of doubt. This is not the time to discuss it but let me say in passing that I do not accept that the Industrial Credit Company made the loans to Dundalk purely on a commercial, business basis. However, there will be another occasion on which we can take that up in another way.

I am not challenging whether the Government were right or wrong to direct them to do it but there is a very strong case to be made, an unanswerable case to be made that when the Government deem it right that funds should be made available for a particular purpose, they should be made available openly and not under the subterfuge of saying that a board makes the money available on a commercial basis. Be that as it may, the Minister himself is not the person who was responsible. That was a decision taken by his predecessor, the Taoiseach, and a most unhappy decision taken by the Taoiseach in his choice of personnel to try to save the employment position for the unfortunate people in Dundalk. However, thank goodness, that aspect is now finished and perhaps therefore it is not necessary for me to say anything more about it.

While I have every possible sympathy with the people who are unemployed in Dundalk, I want to say to the Minister that there is no great advantage to the country as a whole, if one merely makes employment for a person in Dundalk at the expense of the employment of a person in Wexford, or in Cork or in Kildare. I have heard a suggestion that the Government have given directions that State bodies are to give priority to Dundalk firms in relation to any material they want manufactured. I want to make it quite clear that I believe Dundalk should be given the option of competing for tenders just the same as any other concerns, but it is entirely wrong that the sole right of offering for tender should be confined at Government request to the Dundalk series of firms. As I said, people were led to believe in the beginning that they were set up for the export market alone. That has been departed from but at least in trying to salvage, so far as is humanly possible, the employment of the people in Dundalk—and every effort should be made to salvage it— nothing should be done that would injure the employment of the personnel of firms in other parts of the country.

I do not think anybody underestimates the urgent task that faced the Government when the G.N.R. works in Dundalk closed down, with almost 1,000 men employed there. Apart altogether from the social difficulties which were bound to arise immediately, unless alternative employment was found for these men, or as many of them as could be put into other employment, there was, I suggest to Deputy Sweetman, a national issue in it as well, a national responsibility and something that we had to maintain for the benefit of the national economy. There was in Dundalk, employed in the railway works, a big cadre of skilled men, skilled in heavy engineering, and unless some effort was made, apart altogether from the social effects for the men concerned, to contain and retain that employment, the immediate effect would be that they would have gone to all ends of the earth, probably mainly to Britain, and it would have been very difficult to get them back.

When did I suggest it should not have been done?

I think the Deputy suggested that it was not a national issue.

I very definitely think it was a national issue. I do not want to be misunderstood and I do not think the Minister means to misunderstand me, but I must not have made myself clear. It was a national problem to be faced, everyone agrees, but there is no use keeping employee X in employment in Dundalk, keeping him from going to England, if he is pushing Y out of employment in Galway and sending him to England.

I agree entirely.

That is my point. That is all.

On the other hand, it was very difficult to see the impact in every direction of carrying out a major operation such as that was. I do not think anybody tries to pretend it was not. There were certain difficulties that would arise, some of which might be foreseen and others of which might not be foreseen——

And during a very difficult time, the Minister was given every consideration from this side of the House.

We could have made things rather difficult.

I certainly appreciate, since I came into office as Minister for Industry and Commerce, the help and co-operation that has been given to me from that side of the House. I think I put it on record before and it gives me pleasure to do so again.

However, in answer to the specific question put by Deputy Cosgrave there were something less than 1,000 employed there. To be exact, I think it was 967 at the time the take-over was effected. There were many of these in the 60 and upwards age group so it was reasonable to assume some of these would be affected by, shall we say, normal wastage. As well as that, some of the men found alternative employment almost immediately and there are reasonably good avenues of employment in Dundalk where there are some industries employing more than 500 each. In the meantime, in order to get the required personnel for the new activity, the other employees were taken on as well as people in an employment category who were not immediately available in Dundalk. The net position now is that it is estimated that about 500 men as of now will find permanent employment there. I should like to hope, if I cannot venture the guess, that the corner has been turned. It is my hope, at any rate, that employment will continue to increase there. I cannot say definitely, but it seems as if the company has now more or less found its feet and can look forward to expansion given reasonable opportunities.

One of the major disappointments, of course—again I admire Deputy Cosgrave's forbearance in the matter, but I do not think it is necessary not to mention it—was the Heinkel Cabin Scooters, Ltd. That seemed to be something worthwhile at the time even though, I would suggest, it was not something that was expected to be of a permanent nature. It was expected that it would employ at least for a period of some years a considerable number of men and that in the meantime it would be possible to find some other form of activity or undertaking to which these men could be transferred, if and when the Heinkel cabin scooter operation came to an end.

Unfortunately, economic circumstances outside our control prematurely affected that operation. First of all, the credit squeeze in Britain which took place over 12 months ago and the restriction of hire purchase facilities caused the demand in Britain for motor cars to ease off considerably, with the result that the selling agents of the Heinkel cabin scooters found tremendous difficulty in selling these bubble cars and ultimately found that there was no demand at all in Britain for them. That was contributed to by another factor. Another car company that had been manufacturing in a European country came into Britain, competing directly with the Heinkel and at a more competitive price by reason, first of all, of the Customs duty and secondly the lack of having to pay cross-Channel freight rates. These were two factors outside the control of the Dundalk company.

Thirdly, in relation to their other overseas market in the Argentine, to which they were exporting cars in C.K.D. condition, there were financial difficulties in the company to which they were exporting and that company had to give up its orders to Dundalk. In any event, again I should like to say that the exports to the Argentine were not seen in any long-term light, because it was reasonable to assume that the export in C.K.D. condition would ultimately taper off.

C.K.D.—what is that?

Completely knocked down. That form of export would taper off as the Argentine company would get into more fundamental and more basic production itself.

That is the position about the Heinkel and that is the main reason why now such a big number appear to be redundant, for whom this particular sum is to be made available. I should like to say also that there is no question of the Government directing State-sponsored bodies to place orders only with the Dundalk works.

I am delighted to hear that.

The main customers of Dundalk are, naturally, C.I.E. and Bord na Móna but the bulk of C.I.E. business for work that Dundalk could do for them is done by another company altogether. C.I.E. have very favourable arrangements and get very favourable treatment from that other company and there is no question whatever of trying to direct C.I.E.'s orders away from the company which treat them very favourably.

Or that of other State-sponsored bodies?

Or that of other State-sponsored bodies.

I accept the Minister's statement.

Bord na Móna is the only other State-sponsored body——

The Electricity Supply Board.

I cannot say at the moment to what extent the E.S.B. do business with the Dundalk Engineering Works.

I do not know either. I am only assuming that that is the type of business the Dundalk people would do.

I am told that the E.S.B. have not done any business with Dundalk. In fact, that is the reason I confined myself to C.I.E. and Bord na Móna.

I think the Minister would be wise to check on that and I will check on it also.

For the purpose of answering the Deputy's suggestion it suffices to say that there has been no Government direction to any of the State-sponsored bodies to confine orders in any respect to the Dundalk Engineering Works. Secondly, I do not think it was ever specifically stated that the operations in Dundalk on the formation of this company, Industrial Engineering Limited, would be confined to exports. I have made enquiries since and I have flicked through the Dáil Debates of the day and I do not think any such undertaking was given. Certainly, most of the sales, apart from the orders placed by C.I.E. and Bord na Móna, have been in overseas markets, for instance, the Heinkel and the rotovators made by the Bonser group. There have been certainly a very few Heinkel sales within the country but I do not think it could have affected any other manufacturer because the bubble car is considered to be apart altogether from the ordinary saloon cars which are assembled here.

I do not think there is anything else I have to say in reply to Deputies who raised questions except to repeat that I hope the corner has been turned. I have made enquiries independently altogether of the company of the position in Dundalk and I have been given to understand that there is quite good morale there now and having established good morale I hope the company can look forward to maintaining the employment that there is there and ultimately increasing it.

I suppose that in any case the Government are determined to give all the protection and financial aid they can to ensure that the Dundalk Engineering Company will carry on? I mean, it is a lot of information the Minister has given us about a private company.

I have given information in so far as it was necessary for me to satisfy myself that I was justified in coming to the House to look for this Estimate which is a token Estimate as it stands but is in fact for £129,000 for final severance pay. At this stage the Department of Industry and Commerce as such will not be responsible for Dundalk any more. It has been responsible only to the extent that there was an undertaking to recoup the company for any stand-off and severance payments that they made available to their redundant workers. The Government have no direct interest in Dundalk at all.

They have, and I am glad they have. It is cod to be pretending that they have not.

As Deputy Sweetman said, there are public moneys in Dundalk.

We should not be codding ourselves any more. I applaud the Government for what they did when faced with the situation of 1,000 men being unemployed. It is cod to be pretending they are private companies.

The Deputy is trying to have it both ways.

I am not, but the Minister is trying to pretend they are private companies.

They are, too.

They are on paper, but not in fact.

They are all public companies under the Companies Acts.

They are, yes. That is what Deputy Corish means.

Otherwise I would not have been directing questions to the Minister because there would not be any necessity to file the accounts.

Vote put and agreed to.
Top
Share