Dáil Éireann debate -
Thursday, 11 Feb 1965

Vol. 214 No. 2

Committee on Finance. - Vote 41 — Industry and Commerce.

Mr. J. Lynch

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, 1965, 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.

As Deputies will see, the total sum required in this Supplementary Estimate is £68,000 but by reason of savings in other subheads, the net sum required is £10. There are two main purposes: (1) the grant-in-aid to Córas Tráchtála, and (2) the grant-in-aid to the Irish National Productivity Committee.

Deputies will recall that, in introducing the Supplementary Estimate for assistance to industry to offset the effects of the British temporary charge on imports, the Taoiseach stated that the finances of Córas Tráchtála would be increased so as to enable a more intensive market development programme to be organised in countries other than Britain. The activities which Córas Tráchtála propose to extend to assist exporters in developing markets other than Britain include schemes for exhibitions and window displays in department stores in major cities abroad as well as press conferences and receptions; for contributions towards a form of co-operative advertising of particular products in foreign markets; for grants to encourage senior executives of firms producing merchandise with export potential to visit overseas markets; for grants to firms participating in specialised overseas trade fairs, fairs open to trade buyers rather than the general public. The Board have also brought forward the opening of an office on the west coast of the United States to help in opening up markets in that area.

The purpose of this Supplementary Estimate in so far as Córas Tráchtála is concerned is to provide funds for these extended activities. I should perhaps also mention at this stage that the Report of the National Industrial Economic Council on measures to promote exports of manufactured goods stressed the importance of providing adequate funds for Córas Tráchtála work in promoting exports generally. An increase in the funds required for the Board arises also from the fact that, when the Estimate for the current year was being prepared, provision was not made for salary increases which have since been granted as a result of the ninth round.

There is also provision for increased expenditure on the Kilkenny Design Workshops which are being developed more rapidly than was intended. These workshops are intended to assist in improving the standard of design in Irish industry by producing specially designed goods and by providing industry with prototypes of first-class design. It is hardly necessary for me to stress the importance of design in the effort to increase our exports. With the emphasis on new markets this factor assumes even greater importance than heretofore. I commend the Estimate to the Dáil.

So much for Córas Tráchtála. I come now to the Supplementary Estimate for the Irish National Productivity Committee. The Irish National Productivity Committee, which was established early in 1959, expanded its activities considerably in 1963-64. It was financed in that year by a grant of £40,000 from the technical assistance subhead of the vote for my Department. A Grant-in-Aid of £50,000 was approved to the Committee for 1964-65. The Committee now requires a further sum of £8,000 for 1964-65.

The Committee was incorporated as a company limited by guarantee in December, 1963. Membership is representative of the Federation of Irish Industries, the Federated Union of Employers, the Irish Management Institute, State sponsored bodies, Federation of Trade Associations, Irish Congress of Trade Unions, Institute for Industrial Research and Standards, Universities and the City of Dublin Vocational Education Committee. The Committee is governed and directed by the representatives of its constituent organisations.

In its early stages the Committee formed the liaison between the European Productivity Agency and bodies interested in productivity in this country. It also organised joint labour/ management functions designed to promote productivity. The Committee now operates an advisory service for medium and small-sized firms and an information service designed to provide information of a non-technical nature relating to productivity. Through the Human Sciences Committee, the Committee carries out research into problems involving the human factors in industry. It has fostered the organisation of joint productivity committees within industries and continues to develop its promotional work generally.

The increased sum required by the Committee for 1964-65 is due to the expansion of the services provided by the Committee and the increasing demand by business firms for those services. I am satisfied that the services provided by the Irish National Productivity Committee are essential to the achievement of increased productivity. I recommend that the House should approve of this Supplementary Estimate.

Mr. Cosgrave

In considering this Estimate, I think we may overlook the fact that initially when Córas Tráchtála was developed, it arose out of the decision taken by the first Inter-Party Government when it established the Committee to consider the problem of dollar exports, or rather exports to the dollar area. That Committee was established on the basis of views expressed by representatives who were sent here under the Marshall Aid Scheme and part of the recommendations which the experts made in consultation with the Committee was to the effect that efforts should be made to develop and expand trade in the dollar areas.

A very representative Committee was established and I have no doubt that the many benefits which have flowed since then to industry and trade as a result of the work of Córas Tráchtála were due to the attention and interest which the Committee gave to the problem, and the wide variety of interests reflected in the Committee, in making the recommendation that a dollar export board as it was originally thought up should be established. Subsequently the activities of CTT were extended to Britain and the Continent and there is no doubt that considerable benefits have flowed to traders and industrialists as a result of their efforts.

I notice that the Minister referred to the announcement made when the 15 per cent levy was imposed that it was proposed to embark on a more intensive market development programme in Britain. In that connection, I believe some firms are concerned to some extent about delays which have occurred in respect of the refund of part of the levy. While one can understand that adequate documentation is necessary in order to substantiate a claim for repayment, nevertheless, I consider that excessive inquiries or excessive documentation and substantiating of cases may cause unnecessary friction and trouble for traders and business people.

I believe people are familiar with the fact that they are liable, if they contravene the terms of the arrangement, to heavy penalties. The general view in the House at the time the proposal was introduced was that that was an appropriate weapon to apply in cases of individuals or firms making a case for assistance which was not warranted. When those penalties may be invoked against them, it is obvious that very few firms will endeavour to seek assistance to which they are not properly entitled. It seems, therefore, that every effort should be made to expedite and to simplify, so far as possible, the procedure for the making of such payments.

In connection with the work of the Productivity Committee, I think there is general recognition that this has served a useful function, in particular in the case of small firms. One of the problems which small firms have is that it is imposible for them, either from their own resources or from the point of view of personnel, to have available either the financial means or the technically qualified personnel to provide information of a particular character which is essential for development and expansion. These services are more readily available and can be sought by larger units or larger firms. They have both the resources and the personnel.

This service, in the main, provides a benefit to smaller units, of which there are many in this country, who have made commendable efforts and are capable of considerable development. They just lack the personnel or the necessary capital to provide and develop certain aspects of their work. I believe the particular service which this Committee can provide is of considerable benefit to the smaller firms and units.

The other problem is the question of human factors in industry, a matter which requires constant attention even in an age in which there is a more enlightened approach to many of the problems and in which technical and other developments make some of the difficulties and problems which exist in other firms remote. Nevertheless, there is, in spite of all these developments, a constant human problem involved in industrial work and in trade and commerce generally. The research which the Productivity Committee has devoted to that aspect of the matter will undoubtedly provide those who are involved in it with information and I have no doubt, in many respects, remedies for some of the problems which exist. We agree to the Supplementary Estimate in respect of both of these items.

Mr. McQuillan

On the first item, I should like some information from the Minister with regard to what expansion has taken place in exports as a result of the activities of Córas Tráchtála. This year the figure of almost £500,000 is the amount voted by this House for the activities of Córas Tráchtála for the purpose of helping industrialists and others to expand and increase their exports in foreign markets. I should like to hear from the Minister — he should be able to give it — an assessment of what, in terms of money, that grant has meant to this country? Is he satisfied that the return is sufficient to warrant such expenditure, especially in view of the way some of those moneys are being spent at the present time by Córas Tráchtála?

The one point I would make to the Minister in that regard is that Córas Tráchtála seek to concentrate on what I would call an extensive publicity drive, a scattered shotgun type of publicity, with the money available to them. I wonder is this the proper type of publicity to go for? Would it not be better to use a more intensive method of advertising and select the areas and make sure that when the activities are initiated they are followed through? I consider the greatest mistake made so far is to try too many things together, to try to cover the west coast of the USA and various cities and in a very light fashion. It would be much better to concentrate the limited funds we have on certain areas.

When this House decide to give money to enable a higher executive of a firm to go abroad and investigate the possibility of a market, they have a certain responsibility to ensure that if a market is obtained as a result of the grant given, it is not allowed to die within six months or 12 months. The great mistake so far has been that in the first flush of enthusiasm we feel that great success is going to attend the efforts of a particular industry. We see in a short space of time the enthusiasm wanes and the particular items or goods are not delivered, either on time, or to the standard guaranteed when the order was given. That is where Córas Tráchtála should be very critical and careful in their dealings with certain firms.

I do not want to use this debate to widen the scope of the discussion on the Supplementary Estimate but I want to know from the Minister whether portion of this money will go to defray any extra cost for the World Fair Exhibition. I do not know whether that has anything to do with it. The Minister might let us know, because I am not aware at the moment whether Córas Tráchtála have handled any grants for exhibitions there, or whether that comes out of separate funds. I should like to know if there is any connection between the extra money required now and the situation in the World Fair in New York.

It is no harm to emphasise this point when dealing with grants of this nature. Many of the groups who have access to these grants, and who are anxious to obtain grants, spend their time criticising Government and State interference in enterprise. These are the very people who over the years have said that our success and future as a nation in the industrial field depends on the initiative of private enterprise. If ever there was proof of how lacking in initiative private enterprise is, it is in the fact that the Irish taxpayers have to spend £½ million to help big, wealthy, Irish industrialists to go abroad, and to pay their travelling expenses to see if there is a market for their goods.

I want to make it clear that those people cannot have it both ways. If they insist on running down State enterprise and decrying Government action, they cannot expect the State to come to their aid, to pamper and pet them all along the line, as is being done at present. We should be quite open with the public on this issue. It is the taxpayers' money that is being spent on what I call a socialist venture, that is, the State giving aid in a big way to private enterprise which has failed in the most extravagant fashion. Big grants and loans have proved insufficient to wake up private enterprise, and, in addition, the taxpayers have to provide money to enable private enterprise to go abroad to meet buyers, and so forth, at various trade fairs.

So long as we know where we stand in these matters, I think the public will realise that it is absolutely essential for the future, if the expansion which we all desire to see taking place is to occur, for the State to interfere more and more in the activities of those people. They cannot expect this House to vote £½ million and have that money handed over by Córas Tráchtála to private industrialists without some control by this House over its expenditure.

When I say I believe Córas Tráchtála is the body charged with the spending of that money, I realise that the aim is to build up over a period of years, to expand and increase our market, and not just arouse a certain amount of publicity by Press conferences and cocktail parties in half a dozen cities in America, with a big show today and nothing tomorrow. I have seen that happening already in quite an amount of Córas Tráchtála activities. I do not want to blame Córas Tráchtála for the activities of some of the people who were helped in the past, but that has happened and should be a warning to this State body that many of these groups will use and exploit Córas Tráchtála without any sense of responsibility for the future.

I should like to comment on the second Supplementary Estimate. I have no objection to it in regard to productivity, but the point has been made that sufficient attention is not given to the human factor in industrial relations. The late industrial development here in Ireland has, in a sense, given us an opportunity to learn from the mistakes of other countries which had quite a start on us in industrial development. We should be in a position to learn from the mistakes and failures of those countries. It is in that field our investigations should take place. Our problems are very similar to the problems in the countries where industrial development has taken place, but when we talk in Ireland of relations between management and worker, and the human factor, if we are really a Christian society those problems should not exist, or at least should be smaller than they are in the countries where it is suggested that the human dignity of the human being does not count for as much as it should, and where the individual is not respected.

In my opinion, in Ireland those problems should arise only in a minor way. It is dreadful to think that in the small units we have in Ireland any problem of human relations could arise. After all, there is no such thing as a managing director, or a company director, or the boss of a firm, not knowing the majority of those working for him. It is not the same as in a big international concern which might employ thousands of people. We have very few such groups in this country and, in fact, in the few such units we have, relations are excellent. I do not think these problems should arise in the smaller units.

I would say that the main problem which is likely to arise in any unit, small or big, is the problem not so much of human relations as of pay and allowances for work done. In that regard I should like the Minister to be on the alert in relation to the inflow of people who are attracted by the idea of cheap labour. That is a human problem and one this Government will have to face. We all know some people are attracted here to start industries mainly by the fact that labour is supposed to be plentiful and cheap. That is a shocking way to attract people. In fact we have sent people outside the country to speak in France, Germany and elsewhere to suggest that is one of the attractions of Ireland. I know of firms which have subsidiary bodies here and what they are manufacturing here could be manufactured in an annexe of their establishments abroad. I know for a fact that when they heard about the grants available here — this is where I am bringing in the human factor — they said: "This is a wonderful chance to make money. Why should we pay £10 or £12 to workers in our parent factory when we can go to Ireland, get a large grant and pay the same workers one-third of what they are getting at home."

Mr. A. Barry

That would mean £4 a week is all they are paying them here?

Mr. McQuillan

£4 and £4 10s. a week.

Mr. A. Barry

It seems very low to me.

Mr. McQuillan

These are people between the ages of 18 and 21, male labour. The same mentality applies to female labour. I can put the Minister in touch with factories that are paying £2 10s. to £3 constantly to female employees. Is there not a human problem there? Do we need any productivity council to investigate and see that "there is something rotten in the State of Denmark" when that is allowed to continue?

If we are anxious to deal with problems such as those to which I refer and the human factors involved, the Minister has an opportunity of insisting, shall we say, in conjunction with trade unions, that proper payment for work done is given by all industrialists, whether they come as a result of grants or are natives. That is one of the factors to which I think the Productivity Committee should direct its attention because the human factor counts there just as much as the question of whether a manager should be called "Mr. " and whether he should consult members of the staff on various changes that are to take place. The factors I have mentioned are equally important.

Mr. A. Barry

I had hoped the Minister would refer to the premises that are being acquired in London for the central activities of all our organisations. I understand CTT is one of the contributing groups and I had hoped to hear something about whether the costs are in proportion to the advantages anticipated. It is a very good idea that we should have in a city such as London a centre in which all our activities can be conducted and that premises should be impressive.

I do not share the opinions of the previous speaker on many matters and I certainly say that CTT has been a remarkably successful institution, much more successful than I thought it would be when it was formed. It certainly seems to work; it is producing results. Its public relations are good and if they are good at selling themselves to me as a public representative, I am sure they are pretty good at the job of selling Irish products to foreigners. The various directors have been very efficient and the members of the staff I have met abroad have been young Irishmen of very attractive calibre completely devoted to their work. I have no criticism whatever to offer in respect of this organisation, which I think is doing an excellent job.

Mr. Clinton

I believe that CTT is doing an excellent job but that its work is very much hampered by the fact that when it succeeds in getting a market for certain Irish products, that product is not delivered in time, in many cases, and not delivered up to the standard claimed for it when trying to sell it. It must be extremely frustrating for anybody trying to sell our products abroad, especially in a new market, to find when they have succeeded in getting the market that the product when delivered is not up to standard and they themselves have no control in ensuring that the required standard is met.

Deputy McQuillan referred to the cost of the activities of Córas Tráchtála in marketing its products. We must accept that selling is a very expensive business and I think it would be far better not to attempt to sell in any market unless we do a really good job. The cost of putting a product on the market, especially on a new market, will be very high and we should realise that in advance. If we have an exhibition anywhere and do a sort of half job on it, it would be better to stay at home because we are simply portraying our ability to produce certain commodities in a way that is anything but favourable. We must accept that the business is expensive and that CTT, with the limited resources at its disposal and the limited authority it has afterwards to ensure that commodities are delivered up to standard and on time is, on the whole, doing an excellent job.

Mr. J. Lynch

The main point made by Deputy Cosgrave in opening the debate was in regard to suggested delays in procuring assistance under the market development grants which were made available following the imposition of the 15 per cent surcharge by the British Government. I think it will be conceded on all sides that the expedition with which this scheme was got going was far beyond the expectations of even industrialists and exporters.

Immediately the scheme was announced, representatives of industrialists and exporters were interviewed at a fairly exhaustive conference in my Department and a simple and ready method of making these grants available was evolved. The making of the grants available naturally depended on certain documents but even that was reduced to the actual minimum. I believe there have been delays but they have been due to the difficulty on the part of some exporters in getting necessary documents, for example, receipts from British customs for the payment of the levy. Where that arises, we have been in touch with these exporters to see if different forms of verification could be made available to avoid any undue delay. Generally speaking, the exercise has been done in a very expeditious way and if there are complaints about delays, they are very few, and they arise in the main from delays in getting verification documents from the other side.

I am glad Deputy Cosgrave referred to the activities of the National Productivity Committee in relation to its advisory services to small firms. It is true that for these firms it performs a particularly beneficial task. Being small, they cannot afford, or, if they can, they feel they would be unable to undertake, the expense of industrial consultancy services. Special teams of the INPC go into these small firms and advise them how best they can improve their production and kindred matters pertaining to their activities. This is, I think, one of the most valuable services of the INPC.

I want to assure Deputy McQuillan that even though the aspect he discussed in relation to the INPC, that is, labour relations, is not primarily their responsibility — labour relations are mainly the responsibility of the Department of Industry and Commerce — but, in so far as the Human Sciences Committee forms a subsidiary of the INPC, there is of course in the INPC that degree of relationship generally in industry.

I do not think there is any truth in the Deputy's suggestion — I do not want to introduce the word "truth" as against "untruth", but I am sure he will appreciate the context in which I use it — that we go abroad deliberately suggesting that we have cheap labour here. The IDA, which is the main promotional body for attracting industry to this country, tell the world that we have intelligent and adaptable labour. When asked about wages, the IDA tell inquirers that they compare favourably with the rates of wages in neighbouring countries. No attempt whatever is made to induce industrialists to come here on the basis of cheap labour and, as far as wage rates are concerned, these are negotiated in the ordinary way between the representatives of the workers employed and the industrialists who come in here.

Deputy McQuillan asked at the outset of his remarks what was the net contribution that Córas Tráchtála made to our export expansion and whether the amount of money we are voting to it is justified in the light of that contribution. It is difficult to segregate — in fact it is an impossible task — from the overall figures the amount represented by the contribution made by Córas Tráchtála activities. The total figures for 1964 are not yet available but the estimated figures for our exports amounted to over £220 million in 1964 as against £196 million in 1963. Again, I cannot say what contribution the efforts of Córas Tráchtála made to this increase but, in the main, I think its efforts have been devoted to expanding our industrial exports. The industrial export figures for 1964 are not complete but, if I take the nine months January to October 1963 and compare them with a similar period in 1964, our industrial exports increased from a total of £34 million in 1963 to £44.5 million in 1964. That represents an increase of some 31 per cent.

These manufactured goods, I should explain, exclude such items as processed foods, to which Córas Tráchtála also paid particular attention. Suffice it to say that there is a very significant increase in the export of commodities of the type in which Córas Tráchtála take a special interest. As I said, while I cannot segregate the amount of that increase due to the work of Córas Tráchtála, certainly there must be represented in that increase a considerable amount due to its promotional efforts.

I agree with Deputy McQuillan it is wrong to diffuse one's efforts too much in this field and Córas Tráchtála does not do that. In the first place, as the House is aware, Córas Tráchtála is not an exporting body. It neither makes nor sells goods. Its main purpose is to help industrialists and exporters to seek out markets and to overcome difficulties in relation to shipping and other matters. These difficulties can be very numerous indeed. Above all, it advises industrialists to ensure that the goods they make for export are of the quality required in the particular market in which they seek to sell them and, as well as that, ensure that the follow up of delivery will meet the orders likely to come in. I was myself associated with one of the special promotions of CTT. I was in at the planning stage and I was consulted right through until such time as the special display took place. I attended it. That was the Lord and Taylor promotion in New York in 1963. Right through the planning of that, it was impressed on those showing goods that there was no point in exhibiting unless they were prepared to follow up repeat orders, up to standard and delivered on time. I think we can safely claim that that promotion was a success from all aspects, from the point of view of opening up a wide new field of overseas customers to the quality of Irish goods and ensuring that Irish manufacturers could live up to and meet delivery orders and standards of quality.

Mr. McQuillan

Has there been a steady increase since the display on that occasion in the USA in the exports of these commodities?

Mr. J. Lynch

I cannot give the Deputy £ for £ of value but I can assure him that overall there has been a steady increase. As well as that, there have been similar promotions in other cities in the United States and in Europe. Córas Tráchtála does not diffuse its efforts to the extent that it seeks to encourage everybody to export. It emphasises the preference for the export of quality goods. Having regard to the scale of our production, we realise we cannot compete in mass produced goods with exporters from other countries. For that reason CTT has taken great pains to emphasise quality and design and it was for this purpose that the functions of industrial design were reposed in Córas Tráchtála. It might appear from the diversity of representation of Córas Tráchtála that it diffuses its efforts, but that is not so. Some Deputy referred to the fact that very few State bodies have been as successful in their promotional efforts as Córas Tráchtála.

Deputy Barry asked about the London premises. The financing of these premises is not, of course, included in this Supplementary Estimate. I should say in passing that it was realised for a long time that there was a great need for a central premises in London situated in a prominent place. Up to now the premises in which CTT could hold trade displays has been in Regent Street. Because of the conditions of the lease, it was not possible to put up even a plate outside the door. One has to go down a long hall eventually reaching what are reasonably spacious premises, but the great disability is that there is no shop front. It lacks the shop front attraction. Originally it was proposed to get premises on what was to be known as the Monaco site in London.

Mr. A. Barry

In Shaftesbury Avenue.

Mr. J. Lynch

At the Shaftesbury Avenue end of Piccadilly Circus. Walking up Piccadilly Circus, one would be facing what was to have been Ireland House. However, for planning reasons, it was not possible for the developers to go ahead with that site. The whole idea had to be abandoned. It would have been necessary at that time to let the portions of the premises not required. In that case a considerable portion would have to be let. The new premises are modest in size, capable of housing the personnel of Córas Tráchtála, IDA and Aer Lingus and others.

Mr. A. Barry

All of Aer Lingus?

Mr. J. Lynch

Aer Lingus will retain their premises in Regent Street.

Mr. A. Barry

What will the terms of the lettings be?

Mr. J. Lynch

I have not got them. A preliminary estimate of what is involved is all I am giving. The premises have been well depicted in sketches in the newspapers. They will be a little more than adequate to accommodate the Irish agencies who will occupy them. I am not certain whether some portion of the premises will be sub-let by reason of the fact that they may be too spacious.

Mr. A. Barry

Will Bord Fáilte be there?

Mr. J. Lynch

Yes. I think that deals with most, if not all, of the points raised.

Vote put and agreed to.

Progress reported; Committee to sit again.