Vol. 235 No. 2
asked the Minister for Industry and Commerce why the Government have decided to withdraw quota protection from the Irish footwear industry from 1st July; if the footwear manufacturers agreed to this decision; and if he has considered the position in that industry.
18.
asked the Minister for Industry and Commerce if he is aware of the crippling effect of the withdrawal of quota protection from the Irish footwear industry as from 1st July next; and if, having regard to the resultant widespread unemployment and damage to the industry, he will reconsider the withdrawal decision.
19.
asked the Minister for Industry and Commerce if he will make a statement on the circumstances under which, and the reasons why he decided to withdraw quota protection from the Irish footwear industry, notwithstanding the fact that the British Government was prepared to continue the existing position for a further four years.
20.
asked the Minister for Industry and Commerce if, having regard to the fear of unemployment and possible closure in the footwear industry, he will reverse his decision to withdraw the quota protection from the industry next July.
21.
asked the Minister for Industry and Commerce if he is aware of the widespread unemployment and redundancy which occurred in the boot and shoe industry when protection from the importation of foreign footwear was relaxed in 1947; and if he will give an assurance that there will not be a recurrence of this situation for those now engaged in the industry by the proposal to withdraw the quota system which is the most effective method of protection for this important industry.
22.
asked the Minister for Industry and Commerce if he is aware of the apprehension with which his statement to withdraw the quota protection from the Irish footwear industry from 1st July, 1968 was received by the Irish Shoe and Leather Workers' Union, boot and shoe manufacturers and the trade generally who are convinced that such action will have disastrous consequences resulting in the dislocation of the industry and widespread unemployment; and if he will reconsider his action, especially in the light of the fact that the British Government are agreeable to continue the existing agreement for another four years.
With your permission, a Cheann Comhairle, I propose to take Questions Nos. 17, 18, 19, 20, 21 and 22 together.
Negotiations for the Anglo-Irish Free Trade Area Agreement commenced from the basic position that all quota restrictions would be removed on and from 1st July, 1966. During the negotiations a postponement of two years was secured for the leather footwear industry. Discussions have been going on between my Department and the footwear industry over the past two years in regard to the situation which was due to arise this year when the quota would be removed and be replaced by customs duties of 31.5 per cent on British footwear and 54 per cent on others. It became clear during these discussions that the industry was divided on the relative merits of retention of quota protection or of allowing the Agreement to come into force. This division of opinion was emphasised when officials of my Department recently met representatives of the industry to discuss the latest alternatives put forward by the British authorities, that is, (a) retention of the quota preferably on an increasing basis up to 1927 followed by an ad valorem duty of 18 per cent which would be reduced by 1975 in three equal instalments, or (b) the operation of the AIFTA from 1st July, 1968.
While the voting at that meeting indicated a preference for a quota, in terms of employment and production the two schools of thought were almost evenly divided. In the absence, therefore, of a clear-cut majority opinion I decided to allow the provisions of the Anglo-Irish Free Trade Area Agreement to take their course. This meant that a duty—31.5 per cent on British footwear and 54 per cent on others— would be substituted for the quota from 1st July, 1968.
Following representations by the industry and the trade unions, I convened a meeting with each of these parties yesterday and I asked for the fullest possible representation of the footwear manufacturers. At this more representative meeting with the manufacturers a vote was again taken and again, in terms of employment and production, it revealed that the industry was almost evenly divided in its views. In all the circumstances I have decided to initiate further consultations with the British Government in accordance with the terms of the Free Trade Area Agreement.
Do we understand from the Minister when he says there was a division at yesterday's meeting that some were of the view that employment would be maintained at the present level, and an almost equal number were of the view that it would not be maintained? Is that the position?
I do not think it is quite as simple as that. It is a question of weighing the short-term against the long-term prospects for the industry, basically whether the industry would do better by having a further period of up to to four years of quota protection and then be subjected to competition with very little protective duty, or alternatively be subjected to competition with high protective duty now which would be gradually reduced. It is a question of assessing the relative effects of those two proposals.
Can the Minister say what practical steps have been taken to provide, either in the short-term or the long-term, alternative employment for the people who are bound to be disrupted in their employment?
It is not possible to say with certainty that there will be unemployment in the industry as a result of this. No one can be quite certain. A lot, of course, depends on the availability of export markets. It is a question of trying to assess which of the two alternatives is likely to cause less disruption in the industry.
Does the Minister not consider that it would be the height of folly to reject the offer made by the British Board of Trade to continue the existing quota for another four years, and that, especially in the light of the fact that many of our Irish footwear industrialists are not as yet ready and prepared for this sterner competition, the four-year period which is being offered by the British would come as a godsend and afford them an opportunity to strengthen their position, to modernise their plant and machinery and generally gear themselves for the sterner competition with which they will have to contend when the quota is abolished? In these circumstances will the Minister keep that in mind?
I should like to make it clear that it is not the responsibility or the function of the British Board of Trade to have regard to the situation of Irish industry. The mere fact that an offer as such is made by the British Board of Trade does not automatically mean that it is in the interests of Irish industry. The assessment of whether it is or not is a matter for us. I have indicated that the assessment in this case is not an easy one to decide, and that if one were to continue the quota, it could well happen that the ultimate, the long-term effect on the industry might be considerably more damaging than the immediate removal of the quota. Obviously in the short-term, the easy course is to continue the quota, but in the long-term, that may not be the best solution. As I have indicated in my reply, in view of the representations which have been made and the votes taken, although they reveal a very close division in the industry, I have decided to initiate further discussions with the British authorities to see whether something further could emerge that would be satisfactory to the industry as a whole.
Is the Minister aware that in the discussions to which he referred which took place between his Department and the footwear industry there was a majority of 12 to five in favour of retaining the quota? Is that not a fact?
If the Deputy is referring to the number of firms, speaking from recollection, I think it was 11 to five, but the Deputy will appreciate that if one wants to get the views of the industry, the number of firms voting one way or another is not in itself representative. One has to have regard to the amount of production and in particular the amount of employment in the industry. On that basis the division was virtually 50-50.
Do I understand from the Minister's reply in general that he is now considering reversing the decision his Department took last week?
I have said I am proposing to initiate discussions with the British authorities with a view to obtaining, if it is possible, some other solution that would perhaps be more acceptable to the industry as a whole, having regard to the fact that the industry is divided virtually right down the middle.
Would the Minister agree that before he made this decision last week, he should have had discussions with all those interests with which he is now going to have discussions? He might have reached a more sensible solution on this matter and would not be changing his mind and changing his step in the middle of the stream.
I would not agree. I have not changed my mind and I have not changed my step.
You are thinking of it. Is it not a fact that purely as a result of the flood of protests——
The Deputy may not make a speech on this question.
That is not so. The position is that I tried to ascertain what the industry wanted.
The Minister should have tried to ascertain that before making his decision.
I tried to ascertain it before making my decision and what I ascertained was that the industry was divided almost 50-50. I called a further meeting which was even more representative of the industry yesterday, discussed the whole position and took a vote and discovered they were still divided almost 50-50.
Why did you not call the more representative meeting earlier?
The Deputy obviously finds the fact that the result of the more representative meeting was the same as the other one to which everyone was invited not to his liking.
I put it to the Minister that he is taking quite an unnecessary risk and that it is in fact a retrograde step to expose our shoe manufacturers——
The Deputy is making a speech.
I am putting a question—to expose our shoe manufacturers to unfair competition of this kind which would arise from the abolition of the quota. I submit it is a relatively easy matter for the manufacturers——
The Deputy may not make a speech on this question. The Deputy may not continue making a speech.
I want to disabuse the Minister's mind of one thing.
The Deputy may not pursue that line. He may put a question if he wishes to do so.
I am putting the question that the Minister would be unwise——
That is not a question.
The view of the organisations which voted on this issue yesterday and the consensus of opinion among the workers was——
The Deputy will please resume his seat. He may not make a speech on this question.
They think it is funny that workers are in danger of losing their jobs.
Deputy Treacy is disobeying the Chair. I must ask him to resume his seat. This is Question Time. The Chair has given every opportunity to the Deputy but he refuses to put a question. He wants to make a speech.
Does the Minister not agree that what will happen will be similar to what happened here in 1947 when footwear was dumped in this country with the result that the industry here was dislocated and there was widespread unemployment and redundancy? Is this not what the Minister will bring down upon our heads?
No. That is what I want to avoid. In 1947, to rehabilitate itself after the war years, the industry agreed and arranged that a great deal of footwear would come in here, duty free, on a quota basis. That did very great damage. I agree with the Deputy that that is so.
I should know what the position was because I was one of the people involved.
What will happen now is that the imports will be subject to quite a high duty which is the very opposite of what happened in 1947 when the footwear came in here free of duty. That was the situation I wanted to avoid. Deputy Treacy was a member of the deputation from the union which I met yesterday. He is aware of the discussion that took place. I think he would agree that, at the end of the discussion, it would be true to say the views of the representatives of the union were that the quota might be the lesser of two evils but that they were not terribly happy about it nor absolutely convinced that one course was definitely more right than the other.
Question No. 23.
I want to assert that the views of the union are——
The Deputy has asserted enough. Next question, which is addressed to the Minister for Health by Deputy Dr. O'Connell.
In view of the manner in which I have been frustrated in asserting the facts of this situation——
The Deputy was allowed to put three supplementary questions and, in addition, he made two long speeches.
——it is my intention to raise the subject matter of this question on the Adjournment tonight.
I shall communicate with the Deputy.
Would the Minister express his thanks to the many people who took the trouble to telephone him and to telegraph him pointing out his mistake, as a result of which he is mending his hand at this stage?
What mistake?
The mistake of making a decision without discussing the matter with the interests with whom the Minister had a discussion yesterday.
My Department discussed the matter with the manufacturers. It is unfortunate that some of them did not come to the meeting. If they had displayed as much interest originally as they did subsequently, we might not have had to hold the meeting yesterday.
The meeting yesterday was held over and above the normal consultation with industry and it yielded exactly the same results. If the Deputy can get up and say that it is quite clear that what we should have done was to keep the quota and not the other then I would point out that half of the shoe industries do not agree with him.
A week after the Minister made the decision, he is having second thoughts about it.
The giants of the industry do not want it. They are not concerned about the smaller firms. We shall have this on the adjournment.
Will the Minister tell the House how many people will be disemployed as a result of this decision?
Deputy Coughlan will please resume his seat.
Again, let me ask the Minister how many people will be disemployed as a result of this decision?
Question No. 23.
Will the Minister tell us?
