Dáil Éireann debate -
Wednesday, 17 Dec 1969

Vol. 243 No. 10

Industrial Development Bill, 1969: Report and Final Stages.

Mr. Donegan

I move amendment No. 1:

In page 12 to delete lines 1 to 8 and substitute the following:

"(3) This section applies to an industrial undertaking in respect of which the Authority is satisfied that—

(a) (i) it would be likely to provide or maintain employment in the State,

(ii) financial assistance is necessary to ensure its establishment, maintenance or development, or

(b) financial assistance is being sought in connection with re-equipment modernisation, improvement or expansion, and

(c) it is of a reasonably permanent nature and will be carried on efficiently.

An Ceann Comhairle

Amendments Nos. 1, 2 and 4 may be taken together, Nos. 2 and 4 being consequential amendments.

Mr. Donegan

The purpose of this amendment is to set up a situation as recommended by the NIEC whereby existing industries will have exactly the same provision in regard to grants as those from abroad or persons within this country setting up new industries. That is well known to be the policy of this party. I want specifically to declare the detailed policy in this regard which was referred to yesterday on Committee Stage, that we acknowledge, because of the volume of existing industry, that where an industry making a minor development seeks a re-equipment grant, it would be quite impossible to give the same level of assistance to that industry as it would be necessary to give to a new industry. We agree with this completely, but because of the recommendation of the NIEC, because of all the frustration that occurs, we believe it would be better if these provisions were identical in each case. We acknowledge that where there is a minor development the board of the Industrial Development Authority should give a lesser grant. But where an industry with a net capital employed, between fixed assets and every other sort of asset, of asset, of £100,000 undertakes a development costing between £70,000 and £80,000, that industry should have the same level of grant as would be given to a new industry. One way of doing that is to get rid of section 38 and make the adjustments suggested by these amendments in sections 33 and 34.

Mr. Tully

Deputy Donegan has made a very good point. I am sure the Minister wants to get the Bill through the House as quickly as he can but I should like to read a letter which was sent to somebody who applied for a grant. The Minister spoke about the way the small industries grant was going to help everybody. I am aware this letter may not be entirely relevant at this point but I want to read it out now in order to expedite the matter.

Dear Mr. Z,

We have now almost completed our investigation of the furniture industry in Meath, following the Seminar held in Navan last May, and our subsequent individual discussions.

You will remember that all the speakers at the Seminar emphasised the urgent need for foresight and planning, and the necessity to raise the level of technical, commercial, and management skills within the industry, so that firms will be properly equipped to cope with expected future conditions, especially those of free trade.

It is our opinion that your business has not yet reached the basic level of skill on which further development could be properly planned, and that steps would have to be taken by you to bring your business up to this level before your case could be effectively considered.

This letter was from the IDA, and I understand everybody who applied for a grant received the same communication. The person to whom this letter was sent started from scratch and built up a business. He felt he could expand with a little bit of help. He went to every seminar and discussion and he felt that the small industries grant would be able to help him develop. He found however on receipt of this letter, which must be sent out on a fairly wide scale because it seems to be a stencilled letter, that there was nothing doing. I think more consideration should be given to these people instead of just knocking them down.

Minister for Industry and Commerce (Mr. Colley)

Is that letter from the small industries division of the IDA?

Mr. Tully

Yes, and it was dated 19th November, 1969.

Dr. FitzGerald

The purpose of this amendment is to get over the difficulty which arose in the discussion yesterday. I made the point that it would be desirable for the two systems of grant to be assimilated into a single system. We should not be in a position where an Irish industrialist re-equipping his industry would be at a disadvantage with regard to the grant in comparison with foreign industrialists starting up here. It is not possible to overcome this completely. The scale of grants given for some particularly important industries will be greater than the scale of grants appropriate to re-equipment. It was because of this that the NIEC recommended—indeed, it was the basis of the Arthur D. Little Report—this two-fold system which is set out in sections 33 and 34. It was the view of all those who signed the report that these two should be assimilated into one system, with a second tier available.

Replying last night the Minister made some objections. Some of his objections were invalid because they could only make sense on the assumption that section 33 confines grants to new industries or to industries which have to export 100 per cent of their output. These were administrative regulations applied by An Foras Tionscal and no doubt they will be employed by the IDA when operating the industrial grants scheme in future. There is nothing in legislation to this effect. The Minister was on the wrong track there. When challenged he made a different point which seemed to be a valid point, although rather a captious one. I am sure the Minister thinks many of my points are captious —no doubt it works both ways.

Subsection (3) (a) requires that the assets purchased by the grant should be likely to provide or maintain employment in the State. The Minister suggested that a re-equipment grant might, in the short run, be responsible for a reduction of employment which would contravene this. I pointed out to the Minister that all adaptation grants are supposed to be given with a view to maintaining employment in the best of free trade conditions. My amendment is designed to meet the Minister's point on this. Under this amendment, as proposed, section 33 would apply to two different situations: one which would entitle additional grants to be given in section 34 and the other which would not.

In the first instance industrial grants are given when the authority is satisfied that it would be likely to maintain employment within the State and that financial assistance is necessary to ensure its establishment, maintenance and development. In the second instance financial assistance is given in connection with the re-equipment, modernisation, improvement or expansion. In both these cases the condition that these undertakings are reasonably permanent and will be carried on efficiently should apply, by drafting an amendment with (a) (i) and (ii) or (b) and (c). It has to fall within the present industrial grant category in (a); the re-equipment category in (b) and it must be of a reasonably permanent nature and carried on efficiently in (c).

In those circumstances the industry is entitled to grants at the level of 25 per cent in most parts of the country and 40 per cent in designated areas. This clause about maintaining employment does not govern or affect re-equipment grants, but at the same time they are brought within that category. The only difference in treatment is that in the case of the industrial grant, on a scale which is virtually a new industry, section 34 applies and the higher level of grant is available. By inserting (3) (a) in section 33 the operation of section 34 is not confined. In cases where grants have been given under section 33 (3) (a) they are true industrial grants and not re-equipment grants. The Minister would wish to apply it in that way but the rather clumsy way the Bill is drafted reflects this feeling on the part of the Minister.

If the Minister would take a look at section 38 he will find that it is incorporated in section 33 with the exception of one point which seems to me to be covered elsewhere. If there is any need to incorporate it, that can be done. The Minister will appreciate that I drafted this amendment last night at a time when we thought the Report Stage was going to be taken immediately. It was not possible to take that factor into account. Everything in section 38, with the exception of subsection (5), is covered in my re-drafting of section 33. If it was thought necessary to take subsection (5) into account it could be worked in in section 33 as an additional sub-clause. I think I have met the Minister's point on that. The re-drafting is very much tidier. It avoids the situation where you have a separate section with different provisions and different percentages applying for the re-equipment grants, where Irish industries re-equipping are put on a different footing from foreign industries coming in here. I put it to the Minister that this amendment, which includes as a consequential amendment, No. 4——

An Ceann Comhairle

We are discussing amendment No. 4 with this.

Dr. FitzGerald

They are consequential. I put it to the Minister that the effect of these would be to delete section 38, with the possible exception of subsection (5), which is now incorporated in section 33. I hope the Minister will accept this and that in the light of day he will be able to take a more detached view of it than he did last night. It is desirable and practicable to take account of the views of the kind of bodies represented in the NIEC when they are unanimous on a thing like this and when clearly they reflect a strongly held view of Irish industry, apart from the undesirability of even appearing to discriminate in any way between established firms and new firms. Account should be taken of this.

If there is a genuine difficulty one can, of course, always take account of it and the Government frequently have to reject recommendations where the people concerned have not thought out fully all the implications and where there is a practicable difficulty. It seems to me that all the difficulties the Minister put forward are either, as in the case of his reference to section 33, which applies to new industries and ones exporting 100 per cent, attributable to a misunderstanding on his part or a temporary failure to recollect exactly what is in section 33, or are covered by the form of my amendment which excludes the operation of this section about the value of obtaining employment through the re-equipment grants.

I think I have met any valid point the Minister made and nothing the Minister has said to date gives a reason for not accepting the amendment. He may produce some fresh argument today, but all I can do in drafting an amendment is to try to meet every point made by the Minister on the Committee Stage. It would be unfortunate if an amendment were rejected because of some fresh argument not adduced on Committee Stage. The purpose of Committee Stage is to tease out all the points involved so that one is in a position on Report Stage to draft an amendment taking account of all the points. That being my purpose here, I would hope the Minister would feel himself able to accept this amendment. If there is something I have overlooked—I think there is this question of subsection (5) which I did not have time to deal with last night—we would be quite happy on our side to incorporate this into the new subsection.

This new structure is very important. The Minister should have due regard to the importance of satisfying industrial interests, trade unions and others on this particular point. I have been most careful not to suggest that there is discrimination but, so long as you have two different grant systems, you will not convince Irish industrialists that there is no discrimination. I have loyally supported the Minister in his effort to put across the view that there is no discrimination. Indeed, we have all tried to get this point across. It is now seven or eight years since the re-equipment grants were introduced and we have failed to communicate; the failure of communication is due to the segregation of these two provisions which gives colour to the allegation. It is this which has made it impossible to refute the allegation. This segregation should now be ended and I hope the Minister will accept my amendment.

Mr. M. O'Leary

The number of bodies mentioned by the Deputy as being in support of such a treatment of industry is a convincing argument for the amendment. The Minister is aware that industry on the home market will be facing the same enemy of competition as industry on the export market in the not-too-distant future and the home market will be as big a battleground in the future as will the export market. The Minister may be right in saying that our grants should go towards helping these industries to go into export markets but we must not forget the crucial battle on the home market to maintain existing industry. There will be another cut in tariffs and Irish industry will be facing very keen competition indeed. This academic distinction does not seem fair on the face of it in the light of the situation which will develop. We cannot have a situation in which our grant system would appear to favour the export market when there is a common enemy on both fronts.

There is a great deal to be said for accepting this amendment. The Minister talked about industry being of a reasonably permanent nature and carrying on efficiently. Probably the Minister has statistics. It would be interesting to know the kind of investigation and whether the Minister is satisfied that the instance of failure is decreasing. There is a feeling amongst industrialists that there is a weakening of the critical faculty on the part of the IDA when it comes to assessing a new industry to cater for an export market. There have been uncomfortable instances of new industries, grant-aided, not being as successful as had been prognosticated. Since there is only a limited amount of cash at our disposal we will have to be extremely careful to ensure the permanent nature of the industry. The Minister has emphasised that marketing possibilities must have equal attention with technical competence, but I think we cannot be too careful here. The Minister will have to prove his case for this continuing differentiation in grants.

Mr. Colley

In reply to Deputy Tully, he will appreciate that, without due notice, I could not give any answer at this stage, but I shall certainly investigate the matter.

With regard to the point made by Deputy O'Leary, I will repeat some of the statistics I gave the House in the last few days on the failure rate of grant-aided industries. Overall it is ten per cent but if one takes account of the new start-ups in premises in which failures occurred, it is a net four per cent. All the failures to date, 60 per cent, were cases approved before 1960. It would not be true to suggest that the failure rate is increasing; on the contrary, it is decreasing. For the record I should like to make clear that, contrary to what Deputy FitzGerald said, the A. D. Little Report did not deal with adaptation or re-equipment grants.

I find myself unable to accept these amendments. I endeavoured to make clear to the House yesterday that there is a substantial difference in many cases between re-equipment grants and new industry grants, between the circumstances of the applicants and between the criteria that must be applied. It is for that reason that they are treated separately and distinctly in this Bill. When I was speaking I did not have available the NIEC report in this regard but I knew from my own knowledge and personal experience that this distinction was necessary. It is perfectly clear to me that it is. Despite the considerable play made by Deputy FitzGerald with the NIEC—and he recited the litany of its compositions on a number of occasions—I find that in quoting their anxiety to ensure that no distinction should be drawn between the expansion and significant modernisation of existing industries on one hand and the establishment of new ones on the other, so as to be seen to achieve equal treatment between Irish and foreign enterprises, he omitted to tell us that the NIEC also said:

Such projects should be similarly treated where they fulfil the required criteria to an equal extent.

I explained to the House at considerable length yesterday that this is the basis we have always worked on and on which it is proposed to continue to work under this Bill: that where the criteria are equal the treatment is equal. But if we are to apply the new industries grants criteria to re-equipment grants, in many cases we will exclude people from re-equipment grants. In practice, it is necessary, because of this distinction, to treat them differently and this is why they are in different sections and why the NIEC made the comment they made. They were aware of the fact that there is a difference in many cases and their contention was that where the criteria are fulfilled to an equal extent the treatment should be the same. I made it clear to the House that I accepted this, that I still accept and will continue to accept it. It is because in all cases this condition is not satisfied and cannot be satisfied that it is necessary to have separate sections.

An Ceann Comhairle

If Deputy FitzGerald wishes to put a question he may do so but it is not in order to speak twice on the Report Stage.

Dr. FitzGerald

Is the Minister not aware that the NIEC, in referring to the question of criteria, were referring not to the rather subtle point of maintenance of employment to which the Minister refers? That was not in their minds at all but the acceptance of the need for a two-tier system. The criteria they were talking about were the two sets of criteria. The grants would be the same except that in the case of the new industry fulfilling these much more stringent criteria a higher level of grants would be available. Does the Minister realise that was what was behind the NIEC recommendation? Is he suggesting that they had this subtle thought about maintenance of employment that he is importing into their report——

Mr. Colley

I did not suggest that.

Dr. FitzGerald

Will the Minister then say what he was talking about because he has——

Mr. Colley

I have already told the House and I do not propose to go on telling the House the same thing ad nauseam.

Dr. FitzGerald

The Minister has not mentioned any other provision of these criteria under section 33 which could be suggested not to be applicable to re-equipment grants.

Mr. Donegan

I want to refer briefly to the failure rate mentioned by the Minister. He says that it was a gross 10 per cent but when one takes into account new start-ups in factory premises where there were failures the net figure is 4 per cent. I want to comment, not in a severely critical way, that it is known to me and many others that where new start-ups occur they are very often not as good as the industries that were there before and in fact are merely makeshifts to try to keep the factory premises occupied. There have been second start-ups that have been good but our failure rate is something that I hope will improve-because there is room for improvement.

On the question of criteria, the criteria set down in sections 33 and 34 refer to new industries and everything in section 33 would refer to the re-equipment grant situation as defined in section 38. I do not want to delay the House and will merely refer to three criteria. The industry will get a grant if (a) it would be likely to provide or maintain employment in the State— that would refer to re-equipment grants; (b) financial assistance is necessary to ensure its establishment, maintenance or development—that would apply to re-equipment grants and (c) is of a reasonably permanent nature and will be carried on efficiently —that would have to apply to re-equipment grants.

In section 34, moving to the higher level of grants, the criteria again could all apply to re-equipment grants. I do not want to weary the House with a longer list but the reference is there at subsection (3), (a), (b), (c) and (d) and Members can read the various subsections. They would refer equally to re-equipment grants and to new industries. Therefore, it seems to me, and I am sure to everybody except the Minister, that parcelling off re-equipment grants to existing industry in section 38, which would be entirely deleted from the Bill if our amendment No. 4 were accepted, is a downgrading of the opportunity to secure grants by existing industries.

On this side of the House we have been trying for some time to establish that where a major expansion is involved, if we were in power, we would give equal grants and opportunities. I drafted some of these amendments last night; Deputy FitzGerald drafted others. He drafted the particular amendment in regard to the deletion of section 38 and amendments Nos. 1 and 2 in order to bring re-equipment grants within the scope of sections 33 and 34. We had to work quickly but the effect would be to create a situation where by the people would believe —this is the first absolute necessity— that existing industry would get the same treatment as new industry. If an existing industry which had employed 100 people starts up a new development and will now employ 150, in relation to the cost of the new development, I think that industry should be entitled to all the advantages outlined, provided they meet the criteria also outlined in sections 33 and 34.

Again, I want to emphasise Fine Gael policy in this regard: we believe that where there is a major expansion the re-equipment grant provision should provide the same opportunities. We take credit for the fact that adaptation grants were scrapped. They referred only to export-orientated industries and they had global disqualification clauses as I mentioned yesterday. The wider re-equipment grants were introduced by the Minister by way of press statement about six months ago, and the legislation for them is that which we are now enacting.

While Deputy FitzGerald is quite right to quote NIEC policy what I am emphasising now is not NIEC policy or Congress of Trade Unions or the Federation of Irish Industries policy or anything else. As Fine Gael Shadow Minister for Industry and Commerce it is Fine Gael policy I want to state and I hope it will be reported that: if we were in power there would be amendments to this Bill to provide, in the case of a major expansion, that the industry concerned would have the same opportunity in regard to grants as new industries and they would know they would get it.

Mr. Colley

They do at the moment.

Mr. Dongean

They do not.

An Ceann Comhairle

Is the amendment being withdrawn?

Mr. Donegan

We would be obliged if the Chair would put the amendment.

An Ceann Comhairle

I am putting the question: "That the words proposed to be deleted stand".

Question put and declared carried.

Amendment declared lost.

Amendment No. 2 not moved.

Mr. Donegan

I move amendment No. 3:

In page 13, lines 7 and 8, to delete "Minister with the concurrence of the Minister for Finance" and substitute "Government".

This amendment refers to a new departure. There are two new departures in the Bill. One is not to be dealt with here. It is that the Government are now prepared to take shares in an industry for which they are making a grant. I make no reference to that. The other new departure is that for the first time grants may be made by the authority towards a reduction in interest. This is the first time that we have had this, which could be a continuing subsidy for an industry. It is the first time that we have had this diminution of interest except by the transfer of a grant from An Foras Tionscal to the Industrial Credit Company where a loan had been afforded and where portion of the grant was applied towards diminution of interest with the agreement of the person getting the grant. This is a different thing. This is a situation where the Minister for Industry and Commerce with the consent of the Minister for Finance will make a grant by way of diminution of interest over and above the level of grants provided for in sections 33 and 34. We believe that this should be a Government decision. We believe that, if this must be, it should be a decision of the Cabinet and should be completely and absolutely open and known and that the information should be available to the lowest or highest citizen. It is for that reason that we put down the amendment.

Mr. P.J. Lenihan

There are other sections in the Bill where we find the Minister for Industry and Commerce and the Minister for Finance cooperating in regard to various matters. I refer the Deputy to section 27, subsection (5):

If any dispute arises as to the claim of any person to, or the amount of, any pension, gratuity or allowance payable in pursuance of a scheme under this section, such dispute shall be submitted to the Minister who shall refer it to the Minister for Finance, whose decision shall be final.

Again, section 17 refers to "grants of such amounts as the Minister with the consent of the Minister for Finance may sanction". Right through the Bill one finds this administrative arrangement whereby the Minister for Industry and Commerce co-operates with or seeks the advice of his colleague in Finance. I do not see why it should be objected to. Even though this current subsidy is something new, the same principle should hold.

Dr. FitzGerald

There is not any objection to the principle or any suggestion that the Minister for Finance should not be involved; it is simply the point made last night that we are talking here uniquely in this instance of current subsidies, that is, subsidies to defray current charges as distinct from capital grants. The principle has, on the whole, been maintained heretofore that any such current subsidies to industry or to agriculture must come before the Government as a whole and should not be the prerogative of any Minister even in consultation with the Minister for Finance. There is a principle at stake here that current subsidies are of a particularly peculiar character and it is important that they should have full Government approval and that this distinction be maintained between the two.

It is very important to maintain the distinction because while all sides of the House accept the need for capital grants, when you come to current subsidies for industry it is something that must be looked at extremely carefully because once you start giving current subsidies to industry you move into an area which is very open-ended, an area which can get you into a lot of difficulties. Quite apart from the undesirability of moving into this area without very careful thought and with full Government approval in every case, you are moving into an area also which will be unsustainable in EEC conditions, as the Minister will agree. Capital grants are, under Irish conditions, likely to be permitted to the country, at least in relation to most parts of the country and hopefully in relation to all of it under the terms of the Treaty of Rome as applied here, when and if we become a member of the EEC. The question of these current grants is different and much more doubtful. This is a distinction that should be maintained. We have always tried to maintain this distinction and it is important to make it here. That is why we put down the amendment.

Mr. Colley

I did not accept yesterday and do not accept today that what is involved here is a current subsidy. An essential principle underlying the industrial grants scheme is that all grants, whether they are towards the purchase of eligible fixed assets or towards the subsidisation of interest rates, are to be related specifically to the eligible fixed assets of the undertaking. A form of interest subsidy which is calculated by reference to the amount of eligible fixed assets and is, therefore, determinable — and provision is made here for determining its capital value—is in my view clearly a capital grant and the fact that it happens that for convenience in a few rare cases it will be paid by way of interest subsidy and that we are incorporating it here merely to give greater flexibility to the IDA does not make it a current interest subsidy. Since it is not in my view and indeed, in any reasonable view when examined closely a current interest subsidy, the whole basis for the amendment falls. In any event, as I have indicated to the House on a few occasions, in order to qualify for this at all the two sets of criteria in sections 33 and 34 would have to be met and even then it is visualised that this would apply only in a handful of cases, mainly capital intensive cases. In all cases of that kind the grant would certainly exceed £350,000 and would, therefore, automatically have to come to the Government. But, since it is suggested that this amendment is based on the principle that we are dealing now with current interest subsidy and since that in my view is incorrect and I could not accept at all that that is so, then the principle underlying the amendment falls.

Mr. Donegan

We have not much time. I want to facilitate the Government in getting the Bill through. They owe £24 million on the score of it and it is time somebody got their money. I just want to make a couple of points. Let us face it, where a grant-aided industry does not succeed, the Government are in difficulty and in a political difficulty. If the Government are in a difficulty, there is a very nice way out in respect of helping an industry simply and solely by giving this extra grant by way of diminution of interest over and above the highest figure that is available under sections 33 and 34. I would prefer that this was done by the Government and not by the Minister with the consent of the Minister for Finance. I want this done in the full light of publicity if it is to be done.

Yesterday, I quoted a case—I am not critical of this at all—of a company sponsored by the Government here, a Bill in relation to which is before the House, where interest unpaid to the Minister for Finance is being dealt with in the following way: shares are being given to the extent of £1.2 million to the Minister for Finance in respect of interest that he did not get. In this section it appears to me as if a Government in trouble could get out the side door quietly merely by giving a grant of the interest and the fact that interest was paid on a large industry might not be fully known. For that reason I would prefer to have this as a Cabinet and Government decision. I am not prepared to accept the Minister's statement that anything over £350,000 in relation to sections 33 and 34 would automatically mean a case for the Government. The Government are the people who will interpret this and we might have to go to the law courts to change the interpretation. We do not want that. There is no reason to believe that a Government under pressure and in difficulties might not decide just to waive the interest by utilising the section as it is.

Amendment, by leave, withdrawn.

Amendment No. 4 not moved.

An Ceann Comhairle

I would point out that there is an error in amendment No. 5. The amendment states "In page 13, line 14". It should read "In page 13, line 41".

Dr. FitzGerald

Yes. I move amend- No. 5:

In page 13, line 41, to delete "moneys paid in grants" and substitute "grants made".

The point here is one which came up for discussion last night when, in clarification of this, the Minister stated that the word "make" or "made" in relation to a grant refers either to— indeed indifferently to—the approval of the grant or the paying of the grant. While not very happy about this peculiar use of a word to mean two different parts of a process, one of which may not be followed by the other, as many grants are approved but not paid, it seems to me quite an extraordinary ambiguity.

Without wishing to go behind the word and to modify it and to deal with that point, it seems to me that, even accepting the use of the word "made" or "make" in this way, the section in its present form is entirely inconsistent because all the references in the section, except to that in this particular subsection (3) are to making a grant. In subsection (1) "the Authority may make a grant; (2) the amount of a grant under this section...;". The word "made" is not mentioned but obviously it is referring back to what is said in subsection (1)—wherefore "made" is implied. Then you have "(4) notwithstanding anything in this section, the Government may, in respect of a particular industrial undertaking, permit the making by the Authority of grants...". Everywhere the word "made" or "make" is used except in subsection (3) where a limit is put upon the amounts paid in grants which shall not exceed £350,000. This seems to me to be inconsistent. The Minister has given no explanation of this. Perhaps, there is some reason for this which has eluded me. If so, I think it might usefully have been clarified on Committee Stage.

It seems to me that there is no possible value in having a system under which you can approve a grant of £350,000 but not pay it, whereas, under subsection (4), the Government then can approve and pay, or authorise the payment of this £350,000. I do not understand what reason there could be for this. The Minister has not given any reason. It seems to me worthwhile to clarify the particular section and to make it entirely consistent; to ensure that the authority could not go around approving grants which it would not be in a position to pay; to ensure that, in fact, the authority does get Government permission before approving any grant over that size. It seems necessary to make this change. As it stands at the moment, under subsection (4), the Government have the power to approve a grant of £350,000 but, in fact, the power is not held solely by the Government because, as the limitation imposed by subsection (3) as at present drafted is only on the payment of grants, in its present form this leaves to the authority the power to approve of such grants. The power is not one which the Government alone holds. It is shared by the authority. The authority can apparently approve them but it cannot pay until the Government agree. This seems to be undesirable and internally inconsistent. I would ask the Minister, therefore, to accept the amendment.

Mr. Colley

The formula "moneys paid in grants" was deliberately employed in subsection (3) of section 38. It meets a situation which could not be met were the formula "grants made" substituted, as proposed by Deputies Donegan and FitzGerald. Perhaps, I could illustrate this problem best by taking the case of an industry for which the IDA had approved a re-equipment grant of £350,000 but in respect of which the company had proceeded only with works entitling them to a grants payment of, say, £250,000—not a very unusual situation in fact. On the basis of the subsection as drafted, if, at a later stage, they submitted further re-equipment proposals entitling them to a grant of £100,000, the IDA could, if they were satisfied with these proposals, pay a further grant of £100,000, that is, total grant payments of £350,000, without having to seek the sanction of the Government. If the suggested amendment were accepted, in such a case, it would be necessary for the IDA to go to the Government even though the total had not been exceeded. This, I feel, would be an unnecessary complication and would in itself make this amendment unsustainable. In general, I do not think there is any major point involved in this but, by reason of the case I have outlined, it seems to me that there is certainly much more to be said for maintaining the section as drafted than for accepting the amendment.

Dr. FitzGerald

I fear I have not fully understood the Minister's explanation. Is it the case, then, that, if a firm has been paid a grant of £250,000, the authority will take it upon themselves to approve a further, say, £105,000, bringing it up to over £350,000, without getting Government approval?

Mr. Colley

No.

Dr. FitzGerald

Could the Minister, perhaps explain that again? I have not quite understood it.

An Ceann Comhairle

It is not in order.

Dr. FitzGerald

What?

Mr. P.J. Lenihan

It is quite clear.

An Ceann Comhairle

If the Minister wishes to intervene——

Dr. FitzGerald

What precisely does it enable the authority to do which it could not do if the words were put in that I propose in the amendment?

Mr. P.J. Lenihan

At best, it is only a piddling amendment.

Mr. Tully

Tush, tush.

Mr. Colley

I thought I had explained it as well as I could. I agree it is not a point that is immediately apparent. May I suggest to the Deputy that it is not a major point? I do think, from what I have said, that, if he had time to take it in, he would be satisfied with it. I appreciate that it is difficult to take it in straight away, just like that. I really do not think we ought to go backwards and forwards, contrary to the rules of order, in order to get this exact——

Dr. FitzGerald

I am prepared to withdraw it if the Minister will indicate that the power implied by this form of words for the authority to approve grants of £350,000, without Government approval—whether in one lump or piecemeal by an accumulation of a series—will not be exercised and that there is no intention of their approving grants which they could not pay without Government authority.

Mr. Colley

I can assure the Deputy of that. What I was referring to was the cancellation of the original grant approved. I can tell the House that even though there has been some doubt legally about this in the past the practice has always been that where a firm get a grant, and subsequently get a subsequent grant that brings the total above the figure that was in, it always came to the Government. Even though there was some argument that it did not have to, it always did, in fact, come to the Government.

Dr. FitzGerald

And the intention is to maintain that?

Mr. Colley

Yes.

Dr. FitzGerald

Thanks, I accept that.

Amendment, by leave, withdrawn.

Mr. Donegan

I move amendment No. 6:

In page 14, between lines 20 and 21 to insert the following: "(4) Training grants shall be available for existing industries."

I became quite incensed here yesterday on Committee Stage when the Minister said training grants were not available for existing industries. My amendment seeks to add a new subsection: "(4) Training grants shall be available for existing industries." I instanced cases where an existing industry might take a re-equipment grant; get all new machinery; have new methods—and need training. It seemed to me at this stage that the disqualification by the Minister—across the floor of the House, in conversation—of existing industries, as far as training grants were concerned, was improper. I should like to see within this Bill a guarantee for existing industries that training grants will be available for them. My amendment is to that effect.

Mr. P.J. Lenihan

It is quite clear that the training grant will be available for existing industries, as the section itself stands. It is quite clear.

Mr. Donegan

It is not.

Mr. Tully

The Minister said it was not. That is the trouble.

Mr. M. O'Leary

Would the Minister correct that?

Mr. Colley

First of all, it is quite clear, as Deputy Lenihan says, on the face of the section, that it covers both existing and new industries.

Mr. Donegan

You said the opposite.

Mr. Colley

That is what the section, on the face of it, covers. I said that it was visualised that this section would be utilised for new industry. I also said, if the Deputy recalls, that I knew of one case at least in which existing industry had, in fact, got a training grant—but this is rare— because, in the normal way, the services of AnCO are availed of by existing industry. Remember that, in the case of training grants for new industry, it is not intended as a continuing subsidy but rather as a portion of the package deal which is necessary to get the industry off the ground. I have indicated that it is intended to operate this mainly for new industry but I pointed out that the section, as drafted, does not preclude its being applied to existing industry; that training grants have in fact, been given to existing industry but, in the main, I would visualise existing industry benefiting from training facilities through An Chomhairle Oiliúna rather than through IDA.

Mr. Donegan

Is the Minister accepting the amendment?

Mr. Colley

No, it is not necessary. In fact, it would make the whole thing ridiculous because the section as drafted already covers that point.

Mr. Tully

I think the Minister's statement now clarifies the position.

Amendment, by leave, withdrawn.

Question: "That the Bill be received for final consideration" put and agreed to.

Question: "That the Bill do now pass" put and agreed to.