Skip to main content
Normal View

Dáil Éireann debate -
Wednesday, 26 Mar 1969

Vol. 239 No. 7

Committee on Finance. - Adjournment Debate: Directorship of Irish Companies.

I must apologise for having to seek permission to raise on the Adjournment the subject matter of Question No. 50 and thereby lend myself to what might conceivably be regarded as disservice to this great company, namely the Irish Sugar Company.

This company is one of our few success stories. It was founded practically with the State and grew up with it. It represents the sacrifice and the genius of ordinary Irishmen and Irishwomen. Therefore I wish to see the Sugar Company and its subsidiary remain successful as Irish enterprises and it is because of this that I must now raise some important questions in this House and particularly, perhaps, because of the attitude of the Minister for Finance.

What I am questioning, Sir, is not the good name of the Sugar Company, which is beyond doubt, but a matter of important principle which is based on a fear that a small group of people are given the opportunity to manipulate the company. The power structure as of now leaves a lot to be desired. My fears about this company are easily explained and, despite the contradictions of the Minister for Finance, I believe they are fears shared by many people in this country. When we read the Sunday papers and see articles describing the activities of the foreign company, Heinz, and its new managing director for the UK who is still supposed to be in the employ of this country, we are left to wonder whom the Irish taxpayer is paying to run this very basic and important enterprise.

On the basis of that article, I should like to ask the Minister for Finance if the managing director of the Irish Sugar Company and Erin Foods is being paid by the Irish people to operate their affairs from the head office of Heinz in Britain because as I understand it, and in reply to a question of mine, the Minister says this man resigns his post on 1st May.

There are other important points and questions to be raised. The proposed change in the power managerial structure of the company leaves one to wonder why such an important change could take place without being mentioned in this House and the way in which Ministers seem to concern themselves about the running of the semi-State bodies leaves much to be desired. We should ask for a revaluation of the role of the control of these organisations.

I am very pleased that Mr. O'Reilly has been thought so highly of as to have been awarded a permanent position at £25,000-odd a year and indeed it must be a great tribute to his ability that he should have been so chosen. It is because of that that I question the ethics of his being allowed to keep certain important channels in the structure of the Irish-owned company. The foreign combine, Heinz, recently expanded its control over Fisons Food Products to give it what could only be described as conglomerate status. We would not like to see a situation here whereby the farmer who produces in this country will be providing cheap raw material to be processed by their own company and fed into the Heinz marketing network. I do not believe the Minister would like to see that sort of situation arise, either.

The farmers are alarmed at the apparently unchecked domination of the Sugar Company complex by overtones of outside control. Nothing said by the Minister in this House today allays the fears of these people. We are rightly jealous in this country of the success of that enterprise and we do not wish the situation to arise where, when our success is assured, it is handed over to foreigners.

The people do not want this and I am sure the Minister does not want it either but in all honesty can we ignore the allegations of the former chairman of the Sugar Company, Lieutenant-General Costello, even allowing for a certain prejudice because of the way he was displaced——

That would not be Lieutenant-General Costello's memorandum that the Deputy is reading from by any chance?

It is Deputy Dr. O'Connell who is speaking now.

I wonder.

There can be no doubt that this man must have some important technical knowledge in his possession regarding the running of this company. I do not know Lieutenant-General Costello and I do not know anything about him other than the fact that he was in charge of the Irish Sugar Company but he has made some allegations and it is because of this that I am asking the Minister some questions.

Lieutenant-General Costello served the beetgrowers of this country very well, as Deputy Corry could tell us.

Deputy O'Connell.

I am asking the Minister if he would agree in view of the recent comments of the former chairman of the Irish Sugar Company, that anything that would suggest that this most vital Irish industry, which was founded and is owned by the Irish people was falling into the control of foreign combines should be clarified immediately.

I am also asking the Minister, in view of the recent article in the Sunday Times, whether Mr. O'Reilly has been paid by the Irish people to work for them in Dublin or to work, in fact, for Heinz in Great Britain even though his contract does not expire until 1st May. I am asking the Minister to state how many days Mr. O'Reilly has worked in this country since the Minister or the Taoiseach, who was acting Minister for Finance at the time, allowed him to rescind his contract? I am asking him if he is aware of the disquiet among the people and especially among the farming community about the danger of this company becoming a cog in foreign interests? I am asking him why there is no representative of the farming community on the board of this company; indeed, why it is not even under the control of the Department of Agriculture.

In the circumstances and in view of the disquiet, I am asking him if he will give an assurance to the House that he will set up a public inquiry to examine and report on the allegations made by the former head of the Sugar Company. I see the Minister is——


Is that the word? I am asking the Minister now to state how many managerial or semi-managerial appointments have been made by Mr. O'Reilly since he announced his resignation and I am asking him by a public inquiry and a public debate in the House on the role of this basic Irish industry to allay the fears of the Irish people as to the future of this industry. If the Minister has nothing to be concerned about he should give an assurance to the House and if he has read the allegations made by the former head of the company he should in all fairness conduct an inquiry into them and report to this House exactly the situation regarding the company. I think the other question arises about Mr. Godsil being a managing director and employee of the chocolate manufacturers. I think he is placed in an impossible personal position vis-à-vis his own company in so far as his own company is a customer. I would like the Minister to answer those questions.

It is difficult to take serious account of this. Deputy Dr. John O'Connell is a socialist but I am not too sure in my mind exactly whereon the socialist scale he fits in, whether he is a Castro-Cuban socialist, a Maoist, a Revisionist, a Deviationist or simply a Rathmines intellectual painter. Whatever sort of socialist he is, I always thought socialists, if they believed in anything, and I do not think they believe in a great deal, but if they believed in anything they believed in State enterprise. I am confused and confounded at the attitude of the Labour Party, the Socialist Party in this House, which never miss an opportunity, if they can possibly find one, of attacking and abusing our State enterprises. This is very much a case in point. If this sort of thing is to go on, and if Deputy Dr. O'Connell, whatever his motivation is, makes a practice of meddling in the affairs of State companies in this way, of attacking the people who are trying to run those State companies in this way, then the whole concept of State enterprise will be put in jeopardy.

I want to say that those State enterprises since their foundation have served this country well. They have made a great contribution towards our economic welfare. We in this House have a very solemn obligation on us not to interfere unnecessarily in their affairs. There is a temptation on us, I suppose, to try to exert our influence on them but I think we should resist this. They were set up for a certain purpose and with a certain idea and the idea was that they should to a large extent be free to run their commercial operations from day to day with the minimum interference. Many of them operate in a keenly competitive world and they have to have the greatest possible amount of commercial freedom that this House can give them. They have to get the very best people we in this House can select for them. I think this sort of thing that Deputy Dr. John O'Connell is indulging in here tonight could be extremely dangerous and damaging.

I am afraid to interrupt in case I would be in danger of assault.

Deputy Dr. John O'Connell, of course, should have got his facts right. He asked me about the board of Comhlucht Siúicre Éireann Teoranta. There are two farmers. There is a farmer from Kildare and a farmer from County Carlow. There is a very respected responsible trade union official on the board of Comhlucht Siúicre Éireann Teoranta and there are other members in whom I have the utmost confidence. I am the sole shareholder, as Minister for Finance, of Comhlucht Siúicre Éireann Teoranta and Erin Foods Limited and the suggestion that I or the Government would be in any way a party to handing over control of those valuable national assets to any outside influence is ludicrous.

It seems to me that the link-up between Erin Foods and the Heinz Company was one of the most valuable things that ever happened to Irish agriculture and I think that is recognised by the farmers of this country who have reaped the benefits of it in recent years and they will reap the benefits in the years ahead. By virtue of the link-up the whole massive selling organisation of the Heinz Company was placed at the disposal of Erin Foods. There is no question whatever of the Heinz Company having any control or influence over either Comhlucht Siúicre Éireann Teoranta or Erin Foods. They agreed as partners to set up a mutual selling organisation, Heinz Erin. They both have an equal stake in that joint company. Neither has any control or interest in the other.

Heinz Erin have no interest in Comhlucht Siúicre Éireann Teoranta or Erin Foods, which are still separate independent Irish entities owned by me as Minister for Finance. Conversely, Comhlucht Siúicre Éireann Teoranta and Erin Foods have no interest whatever in the Heinz Erin Company. Both have combined, in one sense, a sound working business arrangement, in a joint marketing venture, Heinz Erin, which already is paying off in a very satisfactory and beneficial way to Erin Foods Limited.

I have the utmost confidence in the board of the two companies. They are combining a wide range of experience and business acumen and I have confidence beyond belief in and admiration for Mr. O'Reilly as a man who has done enormous work for two State enterprises in this country with which he has been associated. In the first instance he was responsible for doing a truly magnificent job in building up Bord Bainne and its marketing organisation. Then, when the Erin Foods project looked like foundering and when losses were accumulating at a staggering rate, the Government asked him if he would take on the job of trying to put this right. To his eternal credit he took it on and put it right. He changed the situation in which this company was losing in the last year before he took over £1.6 million a year to a situation now where its losses are reduced practically to break-even point. He is not serving two masters at the moment. He is still the full-time employee of Comhlucht Siúicre Éireann Teoranta and Erin Foods.

He operates from London.

He does not operate from London.

He is based in London at the moment.

He is still the full-time chief executive of those two companies and giving both of them the sound, sterling service he has always given them.

Has the Minister seen the article?

Regrettably he is leaving on 1st May to take up a very important appointment in the Heinz Company of Great Britain. I am sorry he is going but I have complete confidence in the two chief executives and the staff that he is leaving behind him in those two companies to carry on the job. I think that he will be able to do a good and valuable service for Comhlucht Siúicre Éireann Teoranta and for Erin Foods Limited in his new position. He will be able to help them still, and I am happy that he is continuing his link with the group through his membership of the board of Comhlucht Siúicre Éireann Teoranta. I cannot understand why this matter has been brought before the House in this way.

I think the House is entitled to know when there is a change in the managerial structure of the company.

Not really.

It is entitled to know. It is a very important decision.

The managerial structure of these companies is a matter for the board of directors of these companies. If we appoint the board of directors of these companies and have faith in them then we must trust their judgment. I am perfectly happy and confident that the boards of both companies are competent to do their job in this respect.

To conclude, I want to say that Comhlucht Siúicre Éireann Teoranta has been a very continuing success story. Erin Foods has had a chequered career but at no stage in the history of both companies were things proceeding as satisfactorily at they are at present. In both companies there are good sound boards of directors and competent, trained, skilled, efficient management staff. I think both companies are pursuing sound, progressive policies which will be of benefit to Irish farmers in particular and to the Irish economy as a whole. I do not want an attempt, for whatever reason it is made, to muddy the waters. I hope on reflection that Deputy O'Connell will withdraw whatever half-hearted allegations he has made here.

The Deputy's Party would put a Red on the Board.

Leave your latrine scrawlings out of this. This is too serious a matter.

That is all I have to say in conclusion. I am quite satisfied that both these companies have benefited enormously from the stewardship of Mr. O'Reilly. He is a man of integrity, honour and above reproach in all his dealings. While we regret he has to leave these two valuable Irish companies we hope that in his very important new commercial position he will still be able, through his guidance and encouragement, to help their future progress and development.

The Dáil adjourned at 11 p.m. until 10.30 a.m. on Thursday, 27th March, 1969.