Dáil Éireann debate -
Wednesday, 31 Mar 1971

Vol. 252 No. 11

Committee on Finance. - Vote 40: Industry and Commerce (Resumed).

Debate resumed on the following motion:

That a supplementary sum not exceeding £250,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1971, 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.

—(Minister for Industry and Commerce.)

Mr. Lalor

We had a short and interesting debate on this Supplementary Estimate last night. Deputy Donegan spoke on behalf of the Fine Gael Party and referred to the question of galloping inflation. Deputy O'Donovan said that the Department itself was creating inflation and he went on to compare the amounts of the Estimates of the Department for the last few years.

In the course of his speech Deputy Donegan stressed that as the Department of Industry and Commerce is the creator of employment it is the most important Department of State. It is wrong to criticise the increased expenditure of the Department because it is all the time trying to create new employment and maintain and expand existing employment. Deputy Donegan said that the Department is passing through a difficult time from this point of view. I was rather surprised to hear Deputy Donegan criticising the amount of money being spent for the various purposes I have mentioned.

When Deputy Donegan, who is the Opposition spokesman for Industry and Commerce, has any complimentary thing to say about either the Minister or the Government he traditionally compliments us from the point of view of making a success of a scheme which had either been introduced or mentioned first by him. I was interested to hear him suggesting something which was started by my predecessor, Deputy Colley, and is being further developed by me, that is, an investigation into the various regions of the country to see how best those regions can be developed industrially. The IDA are at present implementing plans for the erection of factories in these regions.

I was amused last night at Deputy Donegan's statement that Fine Gael had a revised policy. I had seen something to that effect in the papers recently. Deputy Donegan claimed that the most progressive element in this revised policy from the point of view of industrial development in the west was the decision to subsidise— that was the term he used—transport costs in relation to industries located in that area. Deputy Donegan and his party must be aware that my predecessor set up an interdepartmental committee to examine this and he must also be aware that I and my colleagues have publicly stated that this particular recommendation is at the moment the subject of governmental investigation. It is possible that Deputy Donegan wants to put himself in the position of being able to say, when I come to make an announcement in regard to this, that once again we swiped one of his ideas. I do not mind—I have said this before—where I get ideas if they are good ideas. If they are good ideas I will do my best to implement them for the benefit of industrial development.

Dr. FitzGerald

We have committed ourselves while the Minister is still fiddling.

Mr. Lalor

We have, in fact, set up regional areas with regional officers and progress in the building of factories has been announced.

Dr. FitzGerald

What has that got to do with it? I am talking about transport.

Mr. Lalor

Deputy Donegan was careful last night to say how far these transport subsidies would go. He qualified the assurance that they would be fully paid. This was wise of him.

Dr. FitzGerald

We extracted something from CIE anyway.

Mr. Lalor

I am in no position to comment on anything that was extracted from CIE. That would be a matter for the Minister for Transport and Power and it would not be proper for me to discuss CIE on this Supplementary Estimate for the Department of Industry and Commerce.

Deputy Donegan also criticised the necessity of having to provide an additional £10,000 for the National Development Association to further the "Buy Irish" campaign. As I said last night, it was hoped that industry would contribute a bigger share to this "Buy Irish" campaign and it was because that hope did not materialise that this extra £10,000 had to be provided. I have spoken on this subject on a few occasions and I am pleased to notice that some trade union leaders have taken up the theme. It is appropriate that it should be taken up by the trade unions. Possibly Ministers for Industry and Commerce have on occasion resorted to an indiscriminate demand that people should buy Irish. I have been careful not to exhort people to buy Irish unless what they are buying is quality Irish. I am satisfied that practically everything we manufacture here is as good as, sometimes better than, the imported article. However, for some reason or other, there are people who still believe that, in order to be "with" it, they must buy the imported article. I hope to get an early opportunity of addressing myself to trade unionists in the distributive trade. I hope to ask them to keep their fellow trade unionists in the manufacturing industry in employment to the extent certainly of not hiding the Irish article in the back of the store or under the counter while presenting the imported article as attractively as possible. I have had experience of this. What the motive is I do not know, but it is disheartening to find the imported article displayed while the Irish article has to be asked for. I welcome the manner in which trade unionists have taken up this rallying cry.

I find myself answering questions here about the boot and shoe industry. It is a fact that we are still exporting twice as many shoes as we import. This shows that our manufacturers are able to produce an article acceptable in the United Kingdom, in the USA and elsewhere. For some reason some Irish consumers prefer imported footwear. I have a responsibility—I am conscious of it—to protect people against themselves and, under free trade conditions, it will be very necessary for people to show a little practical patriotism when buying articles over the counter.

Deputy Donegan said that the reason why Irish industry would not support the campaign was that the Minister for Finance had lost their goodwill. I know that any increase in taxation is unpopular but I do not accept the Deputy's contention that this was the reason why money was not forthcoming for the National Development Association. I propose to take this up with that organisation with a view to seeing if the manufacturer here can contribute a little bit more because it is obviously in his interest. There is no reason why all the money being channelled into the "Buy Irish" campaign should be from Government sources. The people who are hoping to glean the immediate benefit from this should be expected to contribute. Over 20 firms did contribute to this scheme in 1970 and I hope more firms will contribute and that they will contribute more generously. To contribute to any extent at all must be of tremendous benefit to them in view of the increased awareness by the man in the street of the necessity, in the national interest, to buying Irish manufactured articles.

Deputy O'Donovan criticised the annual report of the IDA for making specific reference to the progress that had been made between 1952 and 1970. I have not had the opportunity of going into this with the board of the IDA but it was a progress report.

Dr. O'Donovan

They might at least have said when they were founded since they were making such a long report.

Mr. Lalor

They were making a report on the grant aid to industry arising from the passing of the 1950 Act.

Dr. O'Donovan

They grafted the report on to the 1952 Act, which was the Undeveloped Area Act, instead of grafting it on to the foundation Act of the Industrial Development Authority. It was most improper.

Mr. Lalor

Deputy Dr. O'Donovan implied that there was politics-playing in this report.

Dr. O'Donovan

Yes, I did and I meant it.

Mr. Lalor

The chairman of the board who signed the report was appointed chairman last January. Mr. Killeen has been managing director for a longer period. Down through the years the annual reports of An Foras Tionscal have always contained details of the grants which have been allocated since 1952.

Dr. O'Donovan

An Foras Tionscal deals with the undeveloped areas.

Mr. Lalor

The grants by An Foras Tionscal began in 1952.

Dr. O'Donovan

Under the Undeveloped Areas Act, because that is the Act that set up An Foras Tionscal.

Dr. FitzGerald

We are talking about the report of the IDA which has incorporated and subsumed An Foras Tionscal. They were founded in 1949. It was a good point.

Mr. Lalor

That would be rather difficult because the Act was not passed until 1950 and the grants began to issue since 1952.

Dr. FitzGerald

From a different body.

Mr. Lalor

But the grants as allowed under the 1950 Act became payable in 1952 and in fact this board which I created——

Dr. O'Donovan

The new board?

Mr. Lalor

Yes, the new board, is in existence since the 1st January of this year despite the fact that the Act, which enabled the appointment of that board, was passed in 1969. There were no grants previous to 1952 and naturally the review goes from 1952 to 1970. It is a little unfair that the board of the IDA should have been accused of this seeing that those annual reports——

Dr. O'Donovan

Could they not have said: "The IDA comes of age" or something like that?

Mr. Lalor

In order to clarify the issue I will bear in mind what the Deputy has said. I will convey the views expressed by the Deputy and maybe the IDA in their next annual report might give a true reflection of their origin.

Dr. FitzGerald

That is fair enough.

Dr. O'Donovan

Would the Minister be kind enough to make some comment on the quadrupling of their administrative expenditure in two years? I do not know if the Minister has looked at it.

Mr. Lalor

I have not looked at it since last night.

Dr. O'Donovan

Perhaps it is not a fair question but it is extraordinary that their expenditure should have quadrupled, and remember they are in existence only since the 1st January.

Mr. Lalor

They took over new premises. New equipment had to be provided and that naturally costs additional money. In general the IDA is a fair old chopping block in relation to successes, failures and so on. We are talking in terms of trying to bring in rather sizeable industry. Consultancy fees are quite high.

Dr. O'Donovan

I think £50,000 was mentioned by the Minister.

Mr. Lalor

This helps to push up the expenditure. The processing of capital intensive projects, of which the IDA have little experience, gave rise to consultancy expenditure which was not anticipated. It would be very wrong for me as Minister to be critical of them for spending of this nature in relation to trying to attract large-scale industry. I have heard much criticism here before I became Minister—in fact when I was in the back benches—in connection with Potez, for instance, and Deputies will appreciate that care must be taken. The record of successes of the IDA is quite good. It is much better to have something not getting off the ground as a result of an exhaustive inquiry that shows that it would not survive than to set it up and then have the embarrassment of answering a whole lot of intelligent questions as to why it had to close down.

There was a little bit of crossfire last night in relation to surveying and the question of the checks made by the geological survey on the drillings from boreholes. The people who are prospecting, because their licence is a renewable kind of licence, must establish that they have made use of their prospecting licence and have worked in the fields for which they got the licence. Therefore, going along with the prospecting licence is an obligation on the mining company to keep the geological survey fully informed of the results of their explorations, drillings, et cetera. Apart altogether from being kept informed and receiving samples, the survey themselves visit the site and make various checks. There is a dual operation and this is the manner in which it is done. I am at a loss. I am a bit vague on the question that Deputy Dr. O'Donovan asked me some time ago. If that was specifically the question I cannot understand why I did not spell that out as being the answer.

Dr. FitzGerald

I am at a loss.

Dr. O'Donovan

I do not know either.

Mr. Lalor

My impression about the question——

Dr. FitzGerald

What is the question?

Mr. Lalor

It is a Parliamentary Question asked some time ago.

Dr. O'Donovan

I asked what checks were made on the mineral content from boreholes.

Mr. Lalor

My memory of the question was: what check was there on the volume of minerals exported?

Dr. O'Donovan

That was a different question which I addressed to the Taoiseach.

Mr. Lalor

I keep worrying about everyone's questions.

Deputy O'Donovan also raised the question of royalties in relation to mining. Mining royalties are paid as a percentage on profits as calculated for corporation profits tax. They are not calculated on tonnage. However, there are three ways in which royalties can be calculated but this is a system that we have been operating up to now. Therefore, a check on tonnages from the point of view of exporting does not arise. In relation to mineral production there is provision to ensure that there are no false returns in the prices at which ores are sold. It is a function of the Central Statistics Office to check on the export value.

I think that I have covered, in general, the questions raised last night. I was pleased that Deputy Donegan went out of his way to say that he believed that what I appeared to be trying to do in relation to the licensing of mining is correct. His contribution was helpful. The Deputy had something to say, too, about prices. However, the only difficulty is that Deputy Donegan is endeavouring to have it both ways. In the first place, he criticises the Prices Section of my Department. In doing that, he criticises me as Minister for Industry and Commerce because I must clear any price increases that are conceded. The Deputy criticised us in that we are too slow in conceding increases to the manufacturers. He alleged that some increases are inadequate but, on the other hand, he criticised the Prices Section for keeping no control on prices. He is over-simplifying the situation. In today's newspapers we read that the Dublin Gas Company have increased their prices but that at their annual meeting yesterday they talked about the slowness of the Department in conceding much-needed increases and said they had difficulty in continuing production. On the other hand, housewives will naturally protest and say that the Department of Industry and Commerce have no control over price increases. There are complaints by the producers, on the one hand, in relation to the Prices Section of the Department in that they are too efficient and so are too unreasonable while, on the other hand, there is the consumer who, the moment a price increase in announced, criticises the section and says that the increase is not justified.

The Prices Section of my Department consider exhaustively all applications for price increases. I do not think anybody should get away with saying, on the one hand, that price increases are not conceded quickly enough and, on the other hand, that we allow too many increases.

Dr. FitzGerald

Would the Minister not agree that where an increase was justified, it should be given promptly and efficiently and that if it is not so justified, it should not be given at all? Surely that is a fair proposition?

Mr. Lalor

May I ask the economist how am I to know whether an increase is justified before it has been investigated?

Dr. FitzGerald

By having a section which will be in a position to deal with it quickly and efficiently.

Mr. Lalor

We have a section that is geared to deal quickly and efficiently with applications but the volume of applications must be dealt with.

Dr. FitzGerald

It is a contradiction in terms to say that they can deal quickly and efficiently with applications while, on the other hand, saying that the volume of applications is too great to allow them to be dealt with quickly.

Mr. L. Belton

Why is it that in some cases there is a delay of up to two years before an increase is granted, while in other cases two increases may be given within six or 12 months?

Mr. Lalor

Some do not take two years. Under the terms of the regulations, there is a specific period of three months. Very often there seems to be a delay but the reason usually is that the manufacturers may not regard an increase as being satisfactory and so the matter remains with the Department. When it is determined eventually, it is claimed that the increase was not granted quickly enough.

Dr. FitzGerald

There should be adequate staff to deal with the volume of applications received.

Mr. Lalor

We are talking about the Prices Section as it operates at present. I have on the stocks fresh prices legislation which I hope to be able to introduce during the next session in the hope of being able to get this problem dealt with in a far more exhausive way than is possible at the moment.

Mr. L. Belton

Can the Minister explain why some applications for price increases have been with the Department for up to a year and a half while, in other cases, increases have been granted twice within 12 months?

Mr. Lalor

I can answer the Deputy by saying that there is no application that has been with my Department for a year and a half.

Mr. L. Belton

I could give the Minister a few.

Mr. Lalor

If the Deputy is talking about bar prices——

Mr. L. Belton

How long did it take in the case of those?

Mr. Lalor

The problem is in justifying an increase. It took me three months to get a report from 14 firms.

Dr. O'Donovan

Would the Minister not agree that a lot of fish have slipped through the net since decimal day? That is what my wife tells me.

Mr. Lalor

Far be it from me to contradict the Deputy's wife. I would much rather deal with the Deputy himself.

Dr. FitzGerald

What we need is a parliament of wives.

Dr. O'Donovan

Certainly on prices.

Mr. Lalor

That would be fine but I do not think it would please the manufacturers.

Mr. L. Belton

Will the Minister not agree that there have been as many, if not more, reductions as increases in the price of drink?

Mr. Lalor

I hope there have been because the proposal at the time prices were fixed was that some prices would be increased while others would be decreased.

Mr. L. Belton

The price of the pint has gone up by only 0.8 of a penny.

Mr. Lalor

Deputy O'Donovan found that in some public house— he told us it was not one in his constituency—the price had gone up a little too much.

Dr. O'Donovan

I was only making a point.

Mr. Lalor

Deputy O'Donovan complained also that we are giving too many grants to established firms.

Dr. O'Donovan

To well-off established firms.

Mr. Lalor

It is easy to say that a well-established firm is a well-off firm but, as I see it, anything that improves efficiency and which helps firms, particularly those involved in the export trade, is worthwhile. If they need to readapt to make themselves more efficient, to remain more competitive, to hold the export market, I and the IDA have a responsibility to help them to do that. It is very easy to pick out a name like Guinness. The Deputy picked out Guinness last night.

Dr. O'Donovan

I mentioned eight or ten of them. That was the biggest.

Mr. Lalor

Agreed, but when a name like that is dropped the general public say: "Why are they giving it to Guinness and Jacobs and firms like that?" This is very important.

Dr. O'Donovan

How did it happen that adaptation was required for a factory erected ten years ago by Bolands, which is now part of Irish Biscuits, out at Dean's Grange? I think the gross amount of the adaptation grant was £250,000 of which £160,000 or £180,000 has been paid. How did that arise?

Mr. Lalor

We have at present a factory at Shannon Airport which has been in operation for two years and, within that period, the machinery has become antiquated. It is not sufficiently up to date to turn out yarn that measures up to the standards required, at an economic level. As far as the rural areas are concerned, one of the claims made against the Department and the IDA is that if you are an American, or a German, or a foreigner, you have no trouble getting a grant, but if you are an Irishman you have not a hope. Here is a case where we gave an adaptation grant to Irishmen and we find ourselves criticised. It is impossible to do the right thing.

Dr. O'Donovan

Basta Locks got a fair amount of money.

Mr. Lalor

And fully justified. That is scraping the bottom of the barrel. It is very unfair and I am surprised at the Deputy.

Dr. O'Donovan

Basta Locks was brought in here by the second inter-Party Government.

An Ceann Comhairle

The Minister concluding.

Mr. Lalor

He has as good as concluded. In general the comments made on this Supplementary Estimate were quite constructive. I welcome the constructive criticism that was offered. I have told Deputy O'Donovan, in relation to one of the facts that upset him, that I will take the matter up. I always find the contribution made by my opposite number on the Fine Gael benches quite helpful and very constructive. It annoys me now and again that he accuses me of adopting his policy. I am glad to see that Fine Gael have now adopted ours.

Vote put and agreed to.