Dáil Éireann debate -
Wednesday, 15 Nov 1961

Vol. 192 No. 2

Committee on Finance. - Vote 44—Industry and Commerce.

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

I move:—

That a supplementary sum not exceeding £172,990 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1962, 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 sum covers, in effect, two Estimates: One is the anticipated cost of recoupment in the year ending on March 31st, 1962, of ex gratia payments by Dundalk Engineering Works, Ltd., to former Great Northern Railway Board employees at the Board's Dundalk workshops who had to be laid off, temporarily or permanently, because the new group of companies were unable to find suitable employment for them.

The other is the anticipated cost of repayable advances to Nítrigin Éireann Teoranta in the year ending on 31st March, 1962. It will provide for the preliminary expenses of the company, including the acquisition of office premises, the administrative expenses of running the company until the end of the present financial year, the cost of sites surveys and other services in connection with the selection of the actual site for the factory, and the cost of possible purchases from St. Patrick's Copper Mines Ltd.

I shall deal first with the Dundalk Engineering Works Ltd. In the financial year 1958/59, a sum of £50,000 was voted to cover the anticipated cost of ex gratia payments by this company to former Great Northern Railway Board employees at the Board's Dundalk workshops who had to be laid off, 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 £96,957. In the year 1960/61 a sum of £190,000 was provided and expenditure came to £149,424. 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 £73,000 will be required to meet payments under the scheme. It is thus estimated that total payments under the ex gratia payments scheme will come to about £327,989.

Deputies will recall that declarations of permanent redundancy had to be withheld, in order to avoid making unjustified payments, in all cases where there existed a possibility that suitable work would be found. It is due to this cause that in the uncertain employment situation of the new companies, the termination of the scheme has had to be deferred until now.

Between December, 1959, and 31st March, 1960, 167 workers were declared permanently redundant, a further 116 in August, 1960, and 109 in March, 1961, not the anticipated 218 that was mentioned in the debate on 2nd March, 1961. A final group numbering 123 are now seen to be permanently redundant and it is proposed so to declare them, and give them ex gratia payments in accordance with the scheme.

I am advised by the principals of the company that they now feel that suitable employment of a reasonably stable kind can be provided for the workers who will remain in their employment after this last group. As I pointed out to the House during the debate of 2nd March, 1961, on this subject the companies must operate on ordinary commercial principles and the position of the workers will, in general, be no different from the position of workers engaged in the same field of industrial activity.

I now turn to Nítrigin Éireann Teoranta. As has recently been announced, the Government has approved the setting up of a company to negotiate binding tenders for a nitrogenous fertiliser factory to be located at Arklow, based on the use of fuel oil and Avoca pyrites. This company, Nítrigin Éireann Teoranta, has now been incorporated under the Companies Acts and it is the intention to promote legislation at the appropriate time to provide a statutory basis for the company.

As Deputies are no doubt aware, the possibility of establishing a nitrogenous fertiliser factory has been under active examination for many years. The present proposal is, therefore, the outcome of fullest consideration of all factors involved and has taken cognisance of the latest technological developments in the industry.

The Government are satisfied that the economics of using all possible raw materials at alternative locations in this country has been fully considered and that a nitrogenous fertiliser factory operated by a State Company at Arklow could produce nitrogenous fertilisers for sale without subsidisation at prices in line with prevailing import prices.

The decision to proceed with this project marks a most important advance in the implementation of the programme for economic expansion, and will, I am sure, commend itself to Deputies.

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

Mr. Cosgrave

We agree to the proposals announced by the Minister. I note from the figures he has given in connection with the Dundalk Engineering Works that a total of over 500 men have been found to be redundant. I wonder could the Minister indicate, when he is replying, what was the total number of persons employed in the Dundalk Engineering Works before it was closed down, and how many are now employed in the various projects which have been started there.

I understand that some of the persons employed in the new projects were not formerly employed and that naturally some of those formerly employed were not found suitable, for one reason or another, for employment in the new undertakings. I think it is generally recognised that compensation should be paid to those who are found redundant. This proposal follows up the proposal made earlier to provide for the additional numbers who have since been found redundant.

The other proposal which is mentioned here in connection with the establishment of a nitrogenous fertiliser factory is of considerable interest. As is generally known, this matter has been the subject of consideration and investigation over a lengthy period. It came indeed somewhat as a surprise that the final decision to establish this factory was taken in favour of a site at Arklow, but, on reflection, it seems that the available raw materials in the locality, based on Avoca pyrites, justified the decision to establish the factory there.

Initially, this factory was considered for location in different places and, indeed, some time ago an announcement was made that it was proposed to establish a factory for this purpose based on bogland. This recent decision which was announced some short time ago indicates apparently a change in attitude on the latest technological and scientific developments. As I understand it, the earlier proposal was for the manufacture of phosphatic manures from pyrites. The proposal now before us indicates that it is a decision to provide nitrogenous fertiliser by the use of pyrites which are readily available at Avoca.

I think that decision will be generally welcomed, once the Minister is able to give an assurance that there will be no increase in the price charged for the manufactured commodity, nitrogenous fertiliser, to farmers. This decision to use pyrites justifies not merely the decision initially taken to develop the Avoca mines, but is in itself satisfactory. With the great development which has taken place under the direction of the St. Patrick's Coppermines, it means that now it is a decision not merely to develop the copper ore there but also to use the pyrites which are readily available in quite considerable quantities.

Many years ago, one of the problems at Avoca was the difficulty of disentangling or segregating the various ores, particularly copper and pyrites, and, in fact, a considerable amount of the expense involved in the whole operation was due to that technical problem. I understand that recent developments have improved the technique and capacity to segregate these various ores and that St. Patrick's Coppermines have over a period been developing the output there, with the result that it will now be possible, as the Minister says, to have pyrites available in readily accessible and sufficient quantities for the manufacture of nitrogenous fertiliser.

This decision to utilise both products, copper and pyrites, will be generally welcomed because it means that it will be possible to extract the fullest possible benefit and make the maximum utilisation of the supply of ore at present in Avoca. The work which St. Patrick's Coppermines have done and the employment which has been provided there highlight the industrial expansion in recent years. Indeed, the decision to establish St. Patrick's Coppermines in Avoca is one that time has proved was amply justified. We welcome the announcement this evening which indicates the possibility of further development at Avoca and that the new factory at Arklow will provide for that whole area, as well as providing supplies of nitrogenous fertiliser.

I should be glad to hear from the Minister what is the capital of the proposed new company. I understand that legislation will be introduced later and discussion on that aspect of it may be postponed until then, but it would be interesting to hear what the capital is, and, if the Minister is in a position to indicate them, the names of the directors. As I understand it, the Minister's statement indicates that it is proposed to provide nitrogenous fertiliser for sale here without subsidisation, at a price comparable with that prevailing at present for imported fertiliser. If it is possible for the Minister to indicate the cost of that, I should be glad to hear it with the other details, when he is replying.

Generally, this proposal marks a considerable step in the development of the nitrogenous fertiliser industry here, and we shall be interested to hear of its progress in the future and to know that the technical decision now being taken is justified on the basis of the latest scientific and technological information.

Mr. Norton

If one is to judge by the Minister's speech, the provision made here for the recoupment to the Dundalk Engineering Works of sums of money paid out by that company to members of the staff of the former Great Northern Railway Board brings to an end, I gather, the lifelong operation of helping people, who are not likely to get jobs in the new companies, to get compensation in respect of their past services from the Great Northern Railway Board in recognition of the fact that they could not be absorbed into the new company.

It is understood the company have now satisfied themselves there would be no further redundancies and that those who have so far survived will be regarded as ordinary members of the staffs, that their employment will be permanent, subject, of course, to fluctuations in trade. In other words, has the redundancy aspect now been separated from the aspect of permanent employment and can we say that all the redundancies have been cleared, that compensation has been paid to the redundant officers and that those who have survived redundancy can regard themselves as being employed by the new company?

I gather from the Minister's speech that 515 persons have been rendered redundant. Could the Minister give us an idea of what number survived to take up employment in the new company—that is, survived from their previous employment with the Great Northern Railway? I understand there are new staffs in the new company but how many of the old Great Northern Railway staff survive and are now regularly employed in the new company? I think the Minister might, seeing that State capital is invested, have availed of this opportunity to give us a picture of the outlook in so far as the Dundalk Engineering Works is concerned. One of the five companies operating there was a company exploiting the production of the Heinkel small car, but I understand they have ceased to produce it and that that portion of its activities has closed down.

Are we to take it that, as far as that activity is concerned, that unit has ceased production entirely, or is it intended it should, at some later stage, come back into production either in the assembly of small cars or some other activity? Is it, in fact, still limping along at the moment?

Then there are others engaged in light engineering, steel foundries, the tractor business and some other activity which I do not recall at the moment. How are these doing? Does it look as if they have a satisfactory foothold either in the home market or the export market? It was believed, when this group of companies was set up, that after a time it would be possible for them to do fairly well on the equipment available there and in sight of the indigenous skill in Dundalk. What are the prospects now? Are they bright or, at some later stage, particularly with the advent of the Common Market, are we likely to find that more rescue operations will be necessary there?

It might be well if the Minister gave us some such indication. I do not complain about what is being done. I think there was what might be regarded as a bold endeavour made to try to retain staff in employment at a date when the prospect of their employment was swept away by the abolition of the Great Northern Railway workshops. At the same time, because it was so bold a step, it deserves to succeed. I should like to hear from the Minister what the outlook is as far as these firms in Dundalk are concerned and what assurance of regular employment, with stability, is available for the staff now employed under the Dundalk Engineering Works, even though their employment may be operated over four or five separate industries.

On the question of the establishment of the nitrogenous fertiliser factory, this is a problem which has been before Governments from time to time and has been examined by Departmental committees. The views of the Departmental committees reflected very substantially the flow of thought on the whole question as to what is the best type of fertiliser to produce, what fertiliser gives the best results, what type of fertiliser is the farmer most familiar with and could we get him to use nitrogenous fertilisers when he has been using other types? All that medley of viewpoint was confounded by the fact that, up to a few years ago, all the estimates were that to establish a nitrogenous fertiliser industry here would necessitate charging a much higher price for the nitrogenous fertiliser than when that commodity was available from the import market. It was believed the effect of establishing a nitrogenous fertiliser industry here would be to impose a burden on Irish agriculture and I think that was recognised because the present Government adopted a certain pattern in the matter of establishing the industry. That pattern followed two trains of thought: (1) what were the best ingredients for the fertiliser, and (2) what were the prospects that the price would be such as not to impose a burden on the agricultural industry here?

We must, of course, never forget that in so far as we charge high prices for fertilisers, we inevitably raise the price of the raw materials of the agricultural industry and we have got to sell our agricultural produce in a highly competitive British market and later in a still more competitive European market. I should like the Minister to give us some idea as to what price it is hoped to sell this fertiliser at.

The Minister says in his speech that he thinks the fertiliser can be sold at a price which is not substantially different from the prevailing import prices. It must be remembered that nitrogenous fertilisers imported here may be advantageously sold at a low price because of the circumstances of the producers. It is the same with other fertilisers sold here at a lesser price than in the country of origin because the producer can take the profit from the main source of supply and can sell the surplus at a lesser price.

It was the export from certain European countries of other types of fertilisers which made it difficult for the Irish fertiliser industry to make progress against that type of dumping. When the Minister says he hopes we can sell the Arklow fertiliser without subsidisation in competition with imported fertilisers, does he mean—and does he believe—that can be done over a period of years and that he is not taking the present import prices as a medium of comparison with the price of Irish fertilisers? It is reassuring, if the Minister can take a long term view, that by and large nitrogenous fertiliser produced here can be sold at no higher price than the price at which the same fertiliser can be bought on the world market and sold here. If, however, we are to take for purposes of comparison a specially low or a specially high import price here and say that that is the basis, that could prove unreliable in the long run.

There were hopes that this fertiliser would be based on turf. Some members of the Government Party indicated in Offaly the precise place where the fertiliser factory would be located.

Mr. J. Lynch

A bog in Offaly was reserved to produce the peat from which the factory might draw its raw material. There was no decision taken as to the location of the factory.

Mr. Sweetman

There was no decision taken but the location was pointed out, all the same, by one of the Deputies behind the Minister.

Mr. Norton

The Minister has such a lily-white mind politically that he would not think any of his Party members would do such a thing. He would not credit that anyone would point to a certain location and state that that was where the fertiliser factory would be established, and that same individual was not unduly shy in claiming that it was through his and others' herculean exertions that that particular spot had been selected. However, the die has now been cast. I understand Arklow will be the site of this factory.

I should like to ask the Minister will this factory be an entirely State capitalised factory? Will the State hold the entire capital? Will the staff, from top level management down, be State recruited? Is there any question at this stage that the undertaking will be run jointly by the State and an existing large firm in the fertiliser industry? This is a highly technical process. We could spend a great deal of money. We could lose a great deal of money on the basis of trial and error. I should like to know whether this factory is to be entirely State-owned or State and privately owned? Will the personnel be State servants or will people be brought in from some other group to manage the factory for the State? The Minister might also tell us what capital will be necessary for the establishment of this undertaking. I should also like to know whether any export of this fertiliser is contemplated? One of the difficulties in making a project economic is getting its production consumed here. A certain minimum quantity would have to be produced and consumed in order to make the price economic or bring the product within the reach of farmers. Is it anticipated that the entire production will be consumed by the agricultural industry here? Is it visualised that there will be exports to the Six Counties, Britain, or elsewhere? In what way will the factory be balanced so far as home consumption and export are concerned?

I agree many of these matters could be more properly raised on a Bill to provide for the setting up of the company but we are now entering upon new and uncharted seas and it is good public policy and good public relations for the Government to make their explanation as to what is intended so that people will be fully informed and, at the same time, misunderstandings about costs and other features corrected. Misunderstandings arise very largely because of insufficient information on the basis of a project or in relation to the background in which it is framed.

Mr. Sweetman

The Minister knows of old my views on the projects in Dundalk. I want to restate them now. The Minister stated that the Dundalk companies must operate on commercial principles. Does that statement relate to the future or is it intended also to cover the past? If he means it to include the past, then the statement is manifestly untrue and grossly misleading. The facts are entirely at variance if it is intended to cover the past. If the statement is intended to apply only to the future then I can understand the Minister making the statement, but the Minister should make quite clear exactly what he has in mind.

I want to be perfectly clear so that I will not be misrepresented. An attempt was made by one of the Minister's colleagues to misrepresent me in relation to the Dundalk Engineering Works. Let me put the position quite clearly. The Government were faced with a problem in relation to employment in Dundalk because of the closing down of the Great Northern Railway Works. Being faced with that problem, they properly—I repeat "properly"—had to take steps to meet it. They did take steps. What I object to is the attempt that has been made all along to suggest that what was done in relation to Dundalk was an ordinary commercial transaction. It was not. It was a rescue operation taken by the Government because of the particular difficulties that arose on the termination of the Great Northern Railway Works in Dundalk. To suggest, as the Minister once suggested, that it was an ordinary commercial transaction and that there was no Government money involved was untrue and misleading.

The fact is the Government gave a direction to the Industrial Credit Company to make funds available to the Dundalk group of factories. The moneys issued. I suggest to the Minister—it is, perhaps, more a matter for his colleague, the Minister for Finance —that there should be a difference between ordinary commercial transactions operated by the Industrial Credit Company and the type of rescue operation undertaken at the request of the Government; they should not be bulked together in the Company's accounts for the purpose of presenting a misleading picture. The Industrial Credit Company is operating on public money and there is a bounden duty on all concerned to present the fullest picture possible in the most correct light possible.

I am not going to be misrepresented again in relation to this because an attempt was made to misrepresent me before. I am not challenging the wisdom of the rescue operation—I think it had to be undertaken—but I am challenging, and will continue to challenge, the attempt to suggest that no public money was involved. Of course it is entirely public money and the losses incurred in relation to these companies are losses in terms of public money.

I have before me at the moment the losses up to 31st December, 1959. I do not know whether the balance as at 31st December, 1960 has been filed —I am sure it has. The Minister and I had some discussions in relation to that file before and, in fact, he may have assured me since that the balance sheets were filed after that. I cannot remember that, but on 31st December, 1959, as Deputy Norton has raised the question, let me make it clear that Dundalk Engineering Works had lost £173,000; Irish Cabin Scooters had a loss of £111,000; Dealgan Steel Founders had lost £36,000; Frank Bonser had lost £1,700; and Commercial Road Vehicles, £830, making a total of £324,000, while the parent company had lost £26,000, making a total of £350,000.

If, in the subsequent period any of those losses have been cut down, nobody will be more happy than I. It was entirely desirable that the rescue operation should be undertaken and I hope that through the change in direction rather than in the directorate there, in the top executive management, that took place some time ago, the initial mistake made by the Minister's predecessor in getting a certain person already discredited to go in there, has been overcome. If a person of the calibre of the present executive directorate had been there from the beginning, some of that public money might not have been lost.

I think the Minister might tell us the amount of public money. I suppose I could find out by looking in the company's office the amount of public money involved at the moment. My information—and the Minister will no doubt correct me if I am wrong—is that there is a sum of about £2 million of public money involved in this and that on 31st December, 1959, as far as I can understand from the balance sheet, the Industrial Credit Company had made available £1,348,398 and since that time, I think approximately another £650,000—that may not have been all paid out in cash, so to speak, but arrangements were filed in the company's office to show that such sum was being made available. In the circumstances in which £2 million from the Industrial Credit Company is sunk in Dundalk, it is nonsense to suggest that it is an ordinary commercial transaction, or that public money, taxpayers' money, is not involved, and it would be far better for everybody if we were quite frank and honest about the matter and made it clear that a rescue operation was undertaken by the Government and that such a rescue undertaking was necessary, the tragedy of it being that the wrong man was put by the Government in charge of it at the beginning. I can only hope that it is now in charge of a directorate who will make a better shot at it and, in consequence, save the employment for the people concerned.

I also made it clear to the Minister on a previous occasion, and I want to make clear now, that public money should have been made available for the purpose of ensuring that employment would be retained for these people who had suffered loss of employment through the closing down of the Dundalk Engineering Works. Unfortunately, it was not used entirely for that purpose; some of it was used for the purpose of enticing employees from industries in other parts of the country. That does not seem to be good business or to be in accord with the rescue operation which, as I say, was not merely undertaken but should have been undertaken.

So far as the nitrogenous fertiliser factory is concerned, I want to ask the Minister some specific questions before discussing the matter in general. I see in the Supplementary Estimate itself a reference to the note on page 5 of the original Volume of Estimates. I take it that is intended to refer to the fact that this is a grant-in-aid in respect of which the original details will not be vouched for to the Comptroller and Auditor General. If I am right in that respect, can the Minister tell me whether it is usual in a Supplementary Estimate, before legislation is introduced, to give such a grant-in-aid? We all understand that a grant-in-aid is the method by which the House gives to a body already established with the consent of the House funds for the purpose of their being expended by that body without its having to account to the House in the normal meticulous fashion, if I may so term the procedure in regard to the expenditure of Departmental funds. It seems unusual that a grant-in-aid should be given in advance of the legislation. Frankly, I am only depending on memory in regard to that and my memory may not be quite right, but I should like the Minister——

Mr. Corish

I think that merely refers to the surrender of unpaid amounts.

Mr. J. Lynch

I am afraid I cannot recall.

Mr. Corish

I do not think it has much reference to the auditor.

Mr. Sweetman

It has. If the Leader of the Labour Party will look at page 5 of the notes in the volume, he will see.

Mr. Corish

So the Deputy was not depending on his memory?

Mr. Sweetman

I had looked up that part. As far as I can recollect, this is a precedent and I am not at all sure that it is a good one.

Secondly, I should like to have some indication from the Minister as to when he anticipates the legislation in regard to this will come before us. Obviously the discussion we would have on the matter would be considerably tempered by the consideration as to whether the legislation was immediate or remote. I think the Minister should have given us that information in his opening speech.

Mr. J. Lynch

We anticipate that it will be during the next financial year—probably towards the end of it.

Mr. Sweetman

I think the Minister is not treating the House as it should be treated. When the legislation is as far away as that, the House should have been given considerably more information than in this—I was about to say "contemptuously brief statement" but I do not think the Minister meant it to be contemptuous and therefore I shall withdraw that word, having used it—hopelessly brief statement as he introduced the Estimate. I know statements were made during the general election campaign with regard to this matter and announcements were made but the House as such is entitled to a proper explanation and Parliamentary procedure demands that, when a Minister comes in and, for the first time, asks for moneys for an item of this sort, he should give the House, give Parliament, his reasons in proper detail for the project as a whole. I could excuse the Minister if the position were to arise in which the Bill itself would be brought before the House within a matter of months, say, this session or the first day of next session. Then I could understand the Minister saying that as the matter was going to be discussed at such length on the Bill itself within such a short time, there was no necessity to say anything about it now.

He says that is not the position and it is all wrong that the Minister should dismiss the proposal and dismiss the suggestion that he has not come to this House merely for a sum of money that is measurable purely in terms of £100,000, though that is enough; on his own admission by the time he comes back to the House there will be a firm Government commitment in which the honour of the State will be involved for very substantial sums and, for that, four brief paragraphs are provided. I do not think I would be offensive to the Minister when I say that they are paragraphs of utterly vague generalities with nothing concrete at all in the nature of a proposal.

I welcome the fact that the Government have been converted from their previous idea of endeavouring to produce a nitrogenous plant here for something that could not have produced the fertiliser at anything like a reasonable cost. I hope that the estimates forecast in relation to the production of the fertiliser will be justified in practice, that fertilisers can be produced for sale without subsidisation at prices in line with prevailing import prices. By prevailing import prices I mean long term prevailing import prices. I do not mean to compare them with low dumping prices at any one time or to compare them with high scarcity prices just because something happens to have gone wrong at another time. In fact, under the Common Market if it is not an all-round proposition the position certainly will be that in the long run we shall not be able to compete against the production from Germany which I think at the present time supplies most of the nitrogen.

Mr. J. Lynch

Would the Deputy not accept low dumping prices as a favourable comparison?

Mr. Sweetman

How does he mean "favourable"?

Mr. J. Lynch

Favourable to the consuming farmers.

Mr. Sweetman

I would very much like to hear the Minister assuring us it will produce a nitrogenous fertiliser at a dumped price. Will it produce nitrogenous fertiliser at a dumped price?

Mr. J. Lynch

I should not like to use the word "dumping" but the price will be favourable.

Mr. Sweetman

The price will be less than the import price?

Mr. J. Lynch

I shall explain that in my reply.

Mr. Sweetman

And I shall be delighted to hear the Minister explain it although I feel he should have explained all this in his introductory speech, having regard to the fact that the Bill is not coming for such a long time. Be that as it may, this product arises out of a method of utilisation of the by-product from Avoca and it can therefore be taken to be, and should be taken to be, an extension, if you like, of the position arising in Avoca and arising by reason of the fact that the last Government were sufficiently awake to the position then existing to take advantage of the then international price of copper to get people interested at that time. Everybody will tell the Minister that, if they had not been got into the business at that time, it would not have been possible at all at a later stage to get them interested to the same degree. Therefore this is a by-product of the other.

Pyrites is one of the by-products of the extrusions out of copper concentrate after the copper has been crushed and washed out. In that respect I should like the Minister to give us some indication of what the production of pyrites will be in Avoca and in addition to that what the consumption of pyrites is likely to be in this new factory. I accept, of course, that must depend to some extent on the output and on the sales but I understand that usually in most copper mines of that sort, with the marginal percentage of copper such as Avoca, it is the favourable utilisation of a by-product that makes the difference between profit and loss on the transaction as a whole.

As far as I can understand from what the Minister has said in relation to this, it would be entirely Avoca pyrites that will be used. I believe at present pyrites from Avoca are being sold abroad to some extent and being built up and that there are stocks of the secondary extrusions from copper there on the spot which could be used for the purpose of being converted into further pyrites. That conversion, I understand, is a matter of some expense but, as I understand the proposal and the facts as they are at present, Avoca are shipping their pyrites abroad because there is nobody here who has any use for the pyrites. However, this new company when it starts its operations will have to import pyrites in the beginning to ensure that it can carry on and, having imported pyrites in the beginning, I suppose an ordinary flow as between one and the other will take effect.

That seems to me to be a rather nonsensical procedure. There is to be a procedure by which double transport costs would be completely thrown away. We have at present the transport costs of the pyrites that is being sold abroad and when I say that I am talking in terms of the cost to our international balance of payments. We have to pay or somebody has to pay the cost of transporting that new pyrites abroad and when the new factory starts we shall have to pay the cost of importing the pyrites until we can get into the proper even flow in relation to Avoca.

I understand further that the position in relation to the other big I.C.I. works which make nitrogenous fertiliser in this way is that they have a very large Government stockpile so that, at any particular time, there is margin there to carry on. Therefore if the flow of the raw material is in any way impeded for any reason at any time, there is a sufficiently large stockpile to ensure that production at the plant itself shall not be interrupted.

That seems to be a sound proposition. I do not know what the cost is —I know nothing about costings in relation to this matter. It seems to me that there are double transport losses to the nation by sending pyrites out and then having to take them back again after the inception of the factory. It would be better tactics and a better proposition to follow the example in relation to the other plant and have a standby stockpile which could be built up gradually over the period between now and when the factory came into operation.

The Minister has not told us either when it is anticipated that the factory will come into operation. It may be difficult for him to give a date in that respect but I think an approximate forecast should be given, when we are asked to produce the money. In addition to that, I think we should be given some idea today of the total sum of money which has to be put up out of public moneys through the Industrial Credit Company or by legislation, as the case may be. I do not expect the Minister at this stage to differentiate between the Industrial Credit Company advance or the amount going in through legislation. That is a matter that will probably be left until the last minute when the total cost of the plant and the project is more accurately known. We must have an idea of the amount involved. It is desirable that the House should be told something of that at this stage.

As I understand the Minister's intention, it is that the entire project will be a State-owned concern. I should like to have that confirmed. I understand also—and here I speak with some reservation because what I speak of is not based on knowledge I have got of the truth of which I can assure the House but on what I have heard by way of rumour which goes round the town—that at least one other concern, one private enterprise concern, offered to put up such a factory. It spent a very considerable sum of its own money on making investigations as to whether this project was feasible or not. It made it quite clear to the Government that it was not going to ask for any Governmental concession or any Governmental funds, that the funds would be made available otherwise.

I should like to know from the Minister whether that is correct or not. If it is correct, I should like to know why it was the decision was taken in the way it has been taken. There have been many suggestions from time to time that we were finding it difficult to provide not merely the technical know-how in relation to projects ourselves but that we were finding it difficult to find the risk capital. If there was a proposal by certain people that they would themselves provide all the risk capital and produce the article on exactly the same terms as the Minister suggests, then I think that is a matter which should be disclosed to the House so that the House may be in a position to take its decision. When I say "disclosed to the House", it may be that the Minister is not able, or does not feel it would be proper, to disclose it at this stage. If so, then it is a matter which would fall for consideration on the introduction of the legislation itself, but it is a matter about which we are entitled to have some information.

I do not know whether the Minister suggests that this proposal is one that will operate entirely under what I shall call Common Market conditions; in other words, that there will be no restriction by way of either import or quota, regardless of whether or not we have a period of grace under the Common Market. I should like the Minister to make that clear when he is replying. I think that from his statement there would be neither tariff nor quota from the beginning. I think it desirable that that should be confirmed.

Deputy Cosgrave asked the Minister to give us an outline in relation to the company directors and so forth. The company has been incorporated. There are directors at present. Whether those are more than ad interim directors or not is another matter which I think should be cleared up. Has there been any firm arrangement made as to the capital structure of the company? I think that also is a matter that should be ventilated by the Minister in the House at this stage.

Finally, may I inquire from the Minister whether he estimates that this is the last grant-in-aid made to the company before the legislation or whether he estimates it will be necessary to make another grant before legislation in the latter half of the next financial year—I think he said "financial year"? That is a period of another 15 months ahead. Will this £100,000 keep them going until then or does he estimate that he will be coming to the House again for a second interim advance? We should be told that at this stage.

Mr. Everett

I welcome this Estimate. Part of my constituency has been selected for a very important industry. As a trade unionist, I can only offer the Minister every support I possibly can to make a success of the St. Patrick's Copper Mines. It will have a two-fold object. It will, in the first instance, give greater security to employees in the St. Patrick's Copper Mines when they know that the product will be purchased very convenient to their own site when the factory is erected. It will also give employment to many of the men in the rural areas convenient to Arklow town. The Minister can rest assured that there will be sufficient labour available in the area. They will be employed in that industry.

As an old trade unionist having an interest in the development of the industries of this country and especially those in my own county, I can assure the Minister that all concerned will give him every possible support to make this industry a success. I only hope that the Minister will proceed with his work as soon as possible. All these other points will be considered afterwards. The statement made by the Minister officially in the Dáil will help to create an atmosphere of security. I was not worried about statements made outside the House, especially during election times. I am very pleased now that it has been made. I congratulate the Minister and I hope the enterprise will be a success.

Mr. M.J. O'Higgins

I join with Deputy Cosgrave and Deputy Everett in welcoming the proposal to establish the fertiliser factory in Arklow. As Deputy Everett has pointed out, there has been a certain amount of talk about this, particularly during the election and particularly from election platforms in Arklow, and it is good to have it made official by the Minister here.

I agree with Deputy Cosgrave and Deputy Sweetman that the Minister at this stage should give the House some more information than is contained in the brief opening statement which he read to the House. When this matter was spoken about in Arklow and elsewhere in County Wicklow during the election, there seemed to be a very great fund of information available and the House, and certainly the people who will be concerned in Arklow, would welcome that type of information from the Minister now.

I wholeheartedly welcome the proposal to establish the factory in Arklow. I am aware of the fact that there were sites elsewhere in the country considered and under discussion. It should be taken as a tribute, not only to the good sense of the Minister's advisers, but in a very particular way to the inter-Party Government who preceded the previous Fianna Fáil Government, that it is possible to establish this factory in Arklow and to utilise the by-products of the Avoca mines for the purpose of operating it. I think—and I am sure the Minister will not be slow in saying it—it is a tribute to the foresight and vision of those who set about getting the Avoca mines into operation that this factory can now be contemplated in Arklow. It is right that both sides of the House should get the honour and the tribute that is due to them for the development which is now taking place.

I should like the Minister, when replying, to give the House some idea as to what it is hoped will be the employment content when the factory is in operation. I should like, and I am sure Deputy Everett would also like, to have some assurance from the Minister that the labour content in the factory will be of the type which can be drawn locally and that it will not be a question of specialised work and the importation of operatives to run the factory.

Deputy Cosgrave mentioned the question of directors and the company board. I imagine the Minister would feel that it is too early to go into that matter in any great detail but it would be proper to urge on the Minister that when an important undertaking of this sort is being established in Arklow, he should have regard to the desirability of ensuring that there is some type of local representation on whatever board is established.

Mr. P. Brennan

I should like to join with the other speakers in welcoming this Supplementary Estimate, especially that part of it which will be devoted to the establishment of the nitrogenous fertiliser factory. It is some months since a public announcement was made in the Press that such an industry was to be established in or near Arklow. Naturally, those interested in the county were very pleased.

It is very wrong for any Deputy to suggest that there was a great deal of propaganda made out of this matter during the election campaign. Were it not for the fact that Deputy O'Higgins made that reference, I doubt very much if I would have intervened in the debate. I was one of the people who campaigned in Wicklow and I do not think Deputy O'Higgins or anybody else can say that I referred to this development once from a political platform in Arklow or anywhere else. It was something that was announced by the Government and we accepted it as something that was going to happen. I am glad that the Minister has come to the House for the money to establish this fertiliser industry.

The matter was mentioned from a political platform during the election. It was mentioned by the Taoiseach when he spoke in Arklow some days before the election. He was very fair, I thought. I remember him simply saying that the people of County Wicklow would not give the Government any credit for its being situated in or around Arklow; that it was just that the commission set up to deal with this matter had recommended Arklow because it would be more economical to produce the fertiliser in Arklow and that was the reason it was being established in Arklow. I thought it was a very fair statement because political Parties are inclined to use every weapon they have during an election but that weapon was not overused, as far as my recollection goes.

I am glad that this stage has been reached. I should like to ask the Minister whether the company that has been established are negotiating for sites and whether the site will be in the vicinity of Arklow harbour or nearer to Avoca. If the Minister can give that information, I should like to have it. I should also like to know if there is any likelihood of additional trade for Arklow harbour as a result of the establishment of this industry. What exports can we expect? If there is an export trade, will the exports go through Arklow harbour? That is important for the port because any additional trade will help to solve the financial problem of the port authorities. I should be very grateful if the Minister would be kind enough to give me information on these matters.

The question of labour has been mentioned. I sincerely hope the vast majority of the people employed in the industry will be Wicklow people. I am not particularly concerned whether they are from Wicklow or Avoca because at the moment there is no great problem of unemployment in that particular area. I hope the unemployment problem will be solved in County Wicklow generally. I sincerely hope the people employed in the factory will be Wicklow people. That is the only interest I have in it.

I should like again to congratulate the Minister and the Government on the decision they have taken to establish this industry and on their first move in that direction. I hope it will not be very long until we have the industry in full production in Arklow.

Mr. Donegan

I should like, first, to deal with the portion of the Supplementary Estimate which refers to severance payments to Dundalk Engineering Works employees. This matter of severance payments is one that exercised my mind as far back as January, 1958, when I put down a motion in the Seanad in regard to it. The severance payments being made are on a par with the severance payments made to C.I.E. and G.N.R. employees rendered redundant by the closing of lines, and so on. We have now reached the stage when the Minister states:

A final group numbering 123 are now seen to be permanently redundant and it is proposed so to declare them, and give them ex gratia payments in accordance with the scheme.

First of all, I should like to say that if one is to take the situation in globo, while it may be called an ex gratia payment, it is not really an ex gratia payment because the C.I.E. redundancy payments were covered by legislation and these redundancy payments are on an absolute parallel.

Of course the people who are being compensated are the old G.N.R. workers who became redundant not, perhaps, because of the voluntary action of this Government or its predecessor, but because of the action in Northern Ireland. However, the point which I first wish to discuss is the statement by the Minister that a final group, numbering 123, are now to be declared redundant. Only on Monday night last a man spoke to me who said he had 34 years with the G.N.R. and with the Dundalk Engineering Works. He said he felt there was a danger that he could become redundant in the future and he also felt that this final Supplementary Estimate might mean that if he did become redundant this day six months, or this day twelve months, he would receive no payment.

As I understand the Minister's statement when he speaks of a final group, the man was correct in his interpretation of the situation. I am not criticising the Minister or the Government in any way, because what has been described as a rescue operation in Dundalk is very meritorious and one welcomed by the people of Dundalk and of Louth. We on this side of the House sided with the Government and voted with them when they decided to carry out this rescue operation. Only today Deputy Sweetman, the former Minister for Finance, confirmed that view and confirmed the view that the rescue operation should and would have been carried out had we been in the position in which the Government found themselves on the vital occasion when the decision was taken by the Northern Ireland Government. As a Deputy for Louth, it is my duty now to examine what can happen if this is to be a final payment.

I did not intend to refer to the losses of these companies because my hope, as a local Deputy, is to see them progress. At the same time, we have heard Deputy Sweetman's list of losses. He said that he had got these from the Companies' Office in 1959. I got the same figures from the Office today, so that no losses have been filed since then and we do not know whether there have or have not been any losses in the meantime. However, it takes a lifetime to build up a business and in the initial stages ten years is a very short time.

In the modern world of commerce it is true to say that most businesses started are expected to work at a loss for some years. Like Deputy Sweetman I hope the change in the top executive which has taken place will make a difference and that these companies will prosper as a result. I know that the people of Dundalk appreciate the change. They now see that there is a difference and that these companies are being better managed under the able direction of those appointed as directors and that this better management will result in improved financial returns at the end of succeeding years.

At the same time, I must discuss the position of the man who spoke to me on Monday night last. There are 200 or 300 men in a similar position. He is in the position of not being in the final group, and he is very glad that he is not, but he finds himself in the position that if his employment vanishes because the company in which he works finds him redundant, he could look forward, after 34 years with the G.N.R. and the Dundalk Engineering Works, to no compensation. I do not think the Minister or the Government desires that situation to develop. When replying I should like the Minister to tell me does he really mean that this is a final group of 123 and that after that there will be no more severance payments.

If there are to be no more severance payments he must assure the House, the country, the people of Dundalk, and the employees, that the position is that he is going to see that anyone who becomes redundant in the future in any one of these companies through, perhaps, the failure of the company, will be placed elsewhere and his job will continue in one of the sister companies.

That may be a difficult undertaking to give but if the Minister does not give it he is in fact producing a final group and absolute finality regarding severance payment which could affect those who, happily, have kept their jobs but could yet be described as workers engaged in the same field of industrial activity. They cannot be described as being in the same position because of the losses of the companies which we now hope will become profits. I would ask the Minister to consider them in his reply and define exactly what is the position. I hope it is not the situation which I have described and which seems, on the face of the Minister's statement on the position of the employees, to be the factual position at the moment.

There are also certain other matters which arise with regard to severance payments. One is that there are a few men whose jobs did not vanish and who were not redundant but whose services were disposed of by the G.N.R. Company, as it then was, shortly before the company ceased to exist and was assimilated into C.I.E. There are only two or three of these men. One of them had made arrangements to go to work in a locomotive shop in Edinburgh. If he had done so before he reached the age of 65 he could have worked for five years and then, when he reached the age of 70, he could have gained all the British retirement pensions and social services which exist.

This man continued with the G.N.R. without a guarantee from day to day. As a result he passed the age of 65 and was dispensed with a few months before the G.N.R. Board ceased to exist. He finds himself with no severance payment and no opportunity to go to work in Britain with a view to gaining British pensions and so on, at the age of 70. He is at the moment living on the old age pension. I intend to write to the Minister to bring to his notice the position of these two or three men and I know he will view it with his customary good sense and sympathy.

With regard to the nitrogenous fertiliser factory I would be very keen to see employment given as a result of the use of nitrates for our farm lands and the industry at Arklow should achieve that. I want to make sure, however, that we do not do it at the expense of the farms. The indication which I see that such will not be the case is that the new fertiliser factory, as distinct from the old one which was mooted, seems to be on an entirely new basis, being for the manufacture of nitrates through the use of copper pyrites. It was well known that the previous project would have resulted in dearer nitrogen. As has been pointed out, in introducing this Estimate the Minister did not give an explicit guarantee that the fertiliser would be available at world prices. In trade circles it is well known at the moment that there are as many as six nitrogen factories in Europe. These factories are cutting each others' throats trying to dispose of nitrogen.

While one could not describe their nitrogen as an absolute by-product, it is tied up entirely with the production of chemicals and plastics. These companies must produce nitrogen. What they sell it at is not a figure related to their costs of production but related to what they can get for it. That is the explanation for the large quantities of dumped nitrogen that have been available for the past few years. In face of that it is difficult to see what guarantee the Minister can give. But if what can almost be described as a waste product of Saint Patrick's Copper Mines is being utilised, it gives us a completely new concept of the whole matter. If the facts and figures had been produced by the Minister at the outset, we would all be a great deal happier. However, they were not produced and we must ask the Minister to do a little more work when replying.

There was one other point made by everybody who discussed the nitrogen factory with me, and that was that no matter where it was and no matter what raw materials were used—the chief raw material being the air we breathe—the level of employment in nitrogen factories in relation to the amount of capital expended on their construction, was relatively low. I have heard figures quoted outside this House —in fact at meetings held in Arklow during the election campaign—about the employment potential in the factory. I should like to hear the Minister within the House give us his view on what the employment potential will be.

Mr. J. Lynch

I am not going to fight the Wicklow election again.

Mr. Donegan

We do not expect the Minister to do so, but we would like to hear him on what the employment potential will be. We would like to know whether or not he is convinced this nitrogen can be provided for the farmers at present prices and in competition at all times with prices on the Continental market. I hope the nitrogen factory will be a success. I do not want to damn it with faint praise or to say that I know everything about it. I should like to hear the Minister replying in detail, not only on the nitrogen factory but on the specific problems I put to him in regard to the workers at the Dundalk Engineering Works and its sister companies.

Major de Valera

I, too, should like to join in welcoming this proposal to establish the basic elements of a fertiliser industry here. It is a matter that has been talked about for years and, as the matter was being discussed, the economic situation has been changing. Anybody who considers it will feel that the decision ultimately come to by the Government in that connection is right, especially the decision to base the process of fixation on the oil process, as I might call it. As the scheme evolves the soundness of it becomes more apparent. The fact that the factory is to be located in Arklow and that it is to be related, on the one hand, to the Cork refinery and, on the other, to the Avoca mines indicates the type of scheme it is, that it is a coherent one and one tied in with our economy.

I wonder is it realised how big this project is? Although it has been given to us in sizable mouthfuls, it should be realised this is a very big and important development and that not only are we laying the foundation for an important industry that will supply much of our agricultural wants in this field, but that we are also, probably, laying the foundation for such chemical industry as we shall need in the years ahead.

This is not the time to speculate about the economic situation as the Common Market develops but the situation is such now as to justify the decision in the first instance to depend on oil for the fixation of nitrogen. Through the oil refinery we will be able to have a factory which will be able to fix nitrogen and from that product we shall be immediately able to produce either ammonium sulphate or ammonium nitrate as the basic fertilisers. To complete that scheme however the production of sulphuric acid comes into the picture. That is where, I take it, pyrites from Avoca will come in.

Here, then, we have two of the relatively few material essentials of a chemical industry: ammonium or nitric acid products and sulphuric acid products. I look forward to the time when, perhaps, in addition to fertilisers, we will be able to supply certain other chemical needs as well. I would hasten to add that as the economic situation develops and if we are to be integrated with Europe as a whole, the extent to which such industries may develop here and the extent to which there may be reciprocal relations in imports and exports, are matters which I should not like to prophesy about too closely.

I should like to mention another point for the Minister's consideration. Quite clearly, if we are manufacturing sulphuric acid from the pyrites produced from the Wicklow sources, it seems we will not be able to absorb or to use at home all that potential for the production of sulphuric acid. I presume, therefore, an export industry in pyrites is important to us but there is another possibility which I am sure has not been lost sight of, namely, the making of superphosphates, in which sulphuric acid plays a very large part.

I take it the production of sulphuric acid in an Irish chemical works would not be limited simply to the production of ammonium sulphate, and if acid production could be expanded, it would logically be expanded to the point where it could supply the acid needed for the production of superphosphates and other chemical needs.

As regards phosphates themselves, I presume we shall still have to import them but, again, it might be worth having another look at the Clare deposits. I know that in the ordinary way the deposits are small, and I am in no way suggesting that there are concentrated deposits there which would be economic to develop. What I do suggest is that perhaps there is a very low grade wide distribution of phosphates over Clare and that there are modern processes that might justify a re-examination of the Clare situation, either from the point of view of a reserve or a supplemental supply. If that element were in the picture, we would be very well on our way to establishing the fertiliser industry which many people have advocated ever since the war, and well on the way to establishing a basic chemical industry here.

I should like the magnitude of this development to be realised. It is not a matter to be passed by as just the establishment of another industry. I think it is one of the biggest decisions the Government have made and that it is likely to bring very great benefit to the country in its development.

As I said at the beginning, the precise development of the scheme will depend on the economic environment but there are none of us here who are in a position individually to make any very firm statement on that subject. The Minister, the Government and the officials who have the full services of information available to them alone can deal with that, but on the evidence as shown to us in the disclosure of this development, we can be confident that this economic aspect of the situation is being taken into account.

Deputy Donegan seemed to have some apprehensions about the costings and the price of the product. My own impression is that such an undertaking would not be pressed to this stage unless the matter had been gone into very carefully indeed, and that we should take it as the considered opinion of the experts who have studied the matter, both economically and technically, that it will be of real benefit to the country. I think we can take that for granted on this occasion. If that were not so, I do not think the project would be before us now.

It must be remembered that other projects were examined even to the point where recommendations might have been made, but caution compelled a revision in the light of changing circumstances. The fact that the plunge has been taken now is clear evidence that there is a very solid reason and justification for this scheme. I do not think, therefore, that the fears that have been voiced by the Deputy on the opposite side are well founded.

Mr. J. Lynch

I should perhaps deal first with the part of the Supplementary Estimate relating to the payments to be made to the redundant workers in Dundalk. I do not want to disagree in any way with what Deputy Sweetman has said, except in degree. I am glad to note that the action taken by the Government at that time in 1958 was so fully supported by members on the Opposition side of the House, and that the efforts and arrangements made since have enjoyed the same measure of support.

As I indicated on an earlier occasion, it was a trenmendous undertaking at the time to try to contain 960 men, most of them skilled, and very specialised skills at that, and to retain for the nation that cadre of high skill. It was inevitable that there would be certain redundancy because some of the skills in Dundalk were old and not readily adaptable ones. That, in the main, is the reason many redundancies have taken place. The number of redundancies has perhaps exceeded the number originally envisaged because it was impossible then to realise or envisage in any way how the new venture would work out.

In effect, the position was that the parent company called the Industrial Engineering Company Limited was set up. It established, as it went on, five subsidiaries. One of them, unfortunately, did not succeed but that was not by reason of limitation of management or otherwise, but because the principal market it had procured for itself was closed, mainly because of political considerations. I refer of course to the Heinkel or "bubble" car manufacture. The main market was in the Argentine and for the export of cars in a completely knocked-down condition, that market became unavailable, largely because of political considerations in that country.

They next had to turn to Britain as being the main export outlet, but by reason of credit restrictions and other factors that arose subsequently, and the re-establishment in Britain of competition with the Heinkel bubble cars, the British market eventually tapered off considerably, so that except for the home market which was far too small to maintain a viable car-manufacturing process in Dundalk, there was no reasonable outlet for the manufacture of Heinkel cars. Therefore, ultimately Heinkel manufacturing ceased; the Dundalk Company sold the goodwill, and sold whatever parts they had on hand at the time. However, there are four companies still surviving. One of them is the Bonzar, which is subject to going into another line of production. It is doing well, though not finding the going very easy. It did not expect it would find it easy at the beginning because of its being such a new company in a new area. It is expected that that company will now do much better. There is also the foundry, which is now getting on its feet and it, too, has very good prospects. Commercial Road Vehicles, the third company, is doing very well. It undertakes work for different companies, for example, C.I.E., and there are substantial contracts in hand. Then there is the Dundalk Engineering Works which does a variety of contract engineering work for a variety of firms. It, also, is doing very well and expects to continue to do well.

I mention these as an indication that the company has come to the stage when it feels the redundancies it experienced in the past are not likely to recur and that the time has come when the severance payments ought to be ended. I was only a short time in the Department of Industry and Commerce when I met the combined unions representing the workers, who pressed me to bring this severance payments scheme to an end at the earliest possible moment.

Overall, of the 967 workers there at the change-over, there are now a total of 789. It would be wrong simply to subtract that total from the 967, leaving roughly 200, and to assume there have been only 200 redundancies. The fact is that there were many new workers taken on with new skills which were not there before. They amount roughly to 200. In the course of the period there was normal wastage through death, retirement and to people leaving Dundalk in any event. About 61 represents the picture in that respect. In effect, the number of redundancies that had to be provided for by the way of severance payments was about 500. The prospect now is of continued employment. The prospects of the company are equally good and the necessity for maintaining this severance and stand-off pay scheme no longer exists. The company advised me—and it is the company's responsibility to manage these payments— that they would be no longer necessary and that they proposed to terminate them by the end of November.

With regard to the fertiliser project it was not my intention to keep information from the House. However, the House will realise that the company which has been set up and for whose use the £100,000 represented in this Supplementary Estimate is being made available, will have to carry out long, detailed and in many cases delicate negotiations about inviting, getting and accepting tenders for the building of this factory. It would be wrong for me to bind them in any way or to disclose information in advance that would embarrass them in any way. Therefore, the information I was able to give the House was necessarily limited.

As the House is well aware—in fact I am personally surprised at the extent of the knowledge of this matter among Deputies—this is an undertaking that was under review for a very long number of years, going as far back as before the last war. It was seen then, as it is now, as a very substantial undertaking but I am glad to say that even though it was substantial, we decided to undertake it and we believe that we in Ireland, using our own raw material, can make a good job of it. I need only go back to the immediate past to bring the House up to date on the project.

A committee was set up to investigate the possibility of producing nitrogenous fertilisers at a competitive price based on milled peat, one of the raw materials to produce ammonia. For that purpose the Blackwater bog in Offaly was reserved. Bord na Móna said they had the bog almost ready for development and wanted to know what the Government's view was— whether it would be required for turf production simpliciter, or for electric generation or other uses. That examination was brought to finality and when, at that stage, the prices of imported nitrogenous fertilisers dropped considerably—below the prevailing prices and below the prices fertilisers were sold on the markets of the countries of origin—there was a standstill.

Our farmers were continuing to enjoy the benefits of these very low prices and the Government decided not to proceed with the plans then proposed but appointed another committee to keep the matter under review and to bring the plans to the stage when the building of the factory could be undertaken if, and when, the prices of imported nitrogenous fertilisers increased to the point of being in excess of the prices for which we could produce them at home.

During the course of the second committee's deliberations it became obvious that nitrogenous fertilisers produced from a combination of the gasification of fuel oil and the sulphur content of Avoca pyrites would be a very economic undertaking because the prices would compare very favourably with the low prices of imported nitrogenous fertilisers. We now have the position that, after the most detailed examination, and in consultation with the world-wide and world-famed organisations who are well equipped to advise and who are able, technically and otherwise, to construct factories for the production of nitrogenous fertilisers, the committee examining it are unanimously satisfied that to produce nitrogenous fertilisers based on fuel oil and Avoca pyrites is a good economic proposition, one which would ensure the availability of these fertilisers for our farmers without subsidisation of any kind and at prices comparing favourably with those prevailing.

In order to get the matter under way, it was found necessary to establish a company. That company was recently incorporated and the appropriate announcement was made and the names of the members of the company published. Deputy Cosgrave asked me for the names. It obviously escaped his attention that there had been publication of the names.

Mr. Sweetman

I am afraid I must plead guilty also: it also escaped me. Perhaps the Minister would be kind enough to give them to us now.

Mr. J. Lynch

I am quoting from a copy of a Press and radio announcement.

A Company entitled Nitrigin Éireann Teoranta is being incorporated under the Companies Acts, in pursuance of the decision of the Government, to negotiate binding tenders for a nitrogenous fertiliser factory to be located at Arklow and using fuel oil and Avoca pyrites. The Minister for Industry and Commerce has named the following persons as the first Directors of the Company:

J. Murphy, Assistant Secretary, Department of Industry and Commerce, who will be Chairman.

C. J. Byrnes, Principal, Department of Finance.

T. J. Finegan, Farmer, Drummond Farm, Ardee, Co. Louth.

T. Glynn, Principal, Department of Agriculture.

J. B. Hynes, Principal, Department of Transport and Power.

In naming Mr. Finegan as Director of the Company, the Minister has taken into account the representations made to him by the National Farmers' Association as to the desirability of having regard to the special interest of the farming community in the factory products.

There are on the board four civil servants and one representative—not a nominee—of the National Farmers' Association. The function of the board will be to negotiate by tenders with the companies which have already approached them with regard to the setting up of the factory. These individuals will not necessarily be members of the company which will ultimately operate the factory and which will be set up by subsequent legislation.

Mr. Sweetman

Does the Minister visualise a different company operating?

Mr. J. Lynch

Not necessarily. I have no ideas at the moment.

Mr. Sweetman

The position is still fluid?

Mr. J. Lynch

Absolutely.

Mr. Tully

If it is a success, the Minister for Finance will consider setting it.

Mr. J. Lynch

That might be a good idea in the long run. At the moment the intention is to set up a company. In answer to Deputy Norton's question, it will be a State company financed with State capital. In answer to a question raised by Deputy Sweetman, the capital is expected to be of the order of £6,000,000.

Mr. Sweetman

Ordinary capital, preference, or debenture?

Mr. J. Lynch

No thought has been given to that particular aspect yet.

Mr. Sweetman

It has not been segregated?

Mr. J. Lynch

No.

Mr. Sweetman

It is capital in the sense of moneys to be expended, not in the sense of the Companies Acts.

Mr. J. Lynch

Quite so. There will be no association with outside manufacturers. At least, that is not envisaged at the moment. There was a suggestion earlier that a State company would confine itself to the production of ammonia and existing fertiliser manufacturers would buy that ammonia and use it for the manufacture of sulphate of ammonia in their own sulphuric acid plants. It was not certain, however, that that combined operation would be able to produce the fertiliser at a rate as favourable as the method now proposed. In any event, the companies did not pursue that matter; they dropped out of the scene.

There was a suggestion some time ago that some private enterprise group might undertake this operation. Sites were surveyed. Those interested were not an English company and sites in other countries, including Britain, were also surveyed. Ultimately, without any regard to the examination in progress by the Irish company as to the possibility of establishing a nitrogenous fertiliser factory here, that company decided to locate their factory in Britain.

Mr. Sweetman

That is not the case to which I referred.

Mr. J. Lynch

I am not aware of any other.

Mr. Sweetman

My reference was to a group which had considered the setting-up of a factory here and which, at the date of the Government announcement, were still anxious to set up a factory here.

Mr. J. Lynch

There was another case. It was a group who were going to use ammonia imported from elsewhere.

Mr. Sweetman

I do not know anything about the constituent of the product.

Mr. J. Lynch

An immediate difficulty arose. We can produce ammonia fairly competitively but there was the added fact that the imported ammonia would come from a source outside the Common Market and would ultimately have to face the common tariff.

Mr. Sweetman

I do not know whether or not that is the particular case. I do not like mentioning names, but I will give the Minister the names afterwards.

Mr. J. Lynch

The location, of course, did have regard to the availability of pyrites. I cannot at this stage indicate—I am advised by the company that it might embarrass them— the extent to which they may use pyrites. The fact is pyrites are being produced at Avoca in excess of the quantity that will be required by the company, but the company will certainly provide a very useful and profitable outlet for the sulphur content of Avoca pyrites. When pyrites are processed for the production of sulphur, there is another valuable product, sinter or cinter—I have seen it spelled both ways—and that is a valuable raw material for the manufacture of steel. The nitrogenous fertiliser company will be interested only in the sulphur content. It is hoped there will be another outlet for the sinter product.

Mr. Sweetman

It has to be used with an ore mined from the ground.

Mr. J. Lynch

I am advised it is an immediate by-product of the production of sulphuric acid.

Mr. Sweetman

But it does not produce steel on its own.

Mr. J. Lynch

Of course not.

Major de Valera

We will therefore have a sulphuric acid industry here.

Mr. Sweetman

As a result of our foresight in bringing in the Canadians to Avoca.

Mr. J. Lynch

I am quite prepared to give credit for production in the Avoca mines. There were, of course, many years of exploration work before that production started, and that exploration has often been criticised, too.

Mr. Sweetman

That is so, but we are not discussing Avoca now. If we were, I could ask some questions about that, about the percentages that have been found in respect of copper and how they compare with the original prognostications.

Mr. J. Lynch

Deputy Cosgrave mentioned the production of phosphatic fertilisers. The State never contemplated production of phosphatic fertilisers because of the ample production of them by private enterprise within the State at the present time. There is therefore no question whatever of this factory going into competition with private enterprise concerned with producing phosphatic fertilisers.

I think Deputy Sweetman may have been out of the House when I was pointing out——

Mr. Sweetman

I must apologise. I was at another meeting.

Mr. J. Lynch

I did say in my first few remarks that the information I was able to give was necessarily limited because the company that has now been set up will be involved in protracted and delicate negotiations with groups about the examination and ultimate acceptance of tenders and it would embarrass them if I were to give too much information about prices and quantities. I should like to repeat what I said that, taking it in the long term, it is expected that this factory will produce nitrogenous fertilisers at very competitive prices compared even with the present very low prices——

Mr. Sweetman

That was the point at which I came in.

Mr. J. Lynch

——and that there would be no intention whatever of subsidising or giving protection——

Mr. Sweetman

Or limitation by quota?

Mr. J. Lynch

I include quota in the word "protection."

Mr. M.J. O'Higgins

Is the Minister in a position to give any forecast of the permanent labour content?

Mr. J. Lynch

It is anticipated that the labour content will be about 300; it could be more.

Mr. Sweetman

Will the Minister say whether he will have to come back for a second instalment?

Mr. J. Lynch

I said it was hardly likely that I should have to come back. I cannot, however, say definitely. As the Deputy himself advocated, the company would have to see whether it would be worthwhile to stockpile pyrites and if they met with favourable treatment it might be good business for them to do so and good business for the House to provide more money.

Mr. Sweetman

Would the Minister say, in relation to Dundalk, whether they have filed figures since 1959 in the Companies Office?

Mr. J. Lynch

I think the figure the Deputy gave himself is about right, that there is about £2,000,000 in the business.

Mr. Sweetman

There are no further figures filed? Perhaps the Minister has been taken without proper notice? I shall put down a question.

Mr. J. Lynch

I should like to point out that while I did not want to disagree too violently with the Deputy about the private enterprise nature of this Bill, we do not inquire about these things.

Mr. Sweetman

No, but the Minister knows the requirements of the Companies Act and these requirements are that a balance sheet in respect of the period ended 31st December, 1960, should be filed a pretty long time ago.

Vote put and agreed to.