I move:
That a sum not exceeding £28,823,000 (Twenty-eight million, eight hundred and twenty-three thousand pounds) be granted to defray the charge which will come in course of payment during the year ending on 31st March, 1972 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.
In the Book of Estimates the net Estimate of £28,823,000 for the year 1971-72 compares with a sum of £23,805,000 granted in 1970-71 (including a Supplementary Estimate of £250,000). The principal increase arising in the financial year 1971-72 is the increase of £4.5 million in the provision for capital expenditure for the Industrial Development Authority. Other increased provisions are: £174,000 for Córas Tráchtála; £106,000 for the Institute for Industrial Research and Standards; £101,000 for the salaries and wages of the staff of my Department; £83,000 for Shannon Free Airport Development Company, Ltd. to cover administration, etc. (£49,000), housing subsidies (£21,000) and housing grants (£13,000). There is an increase of £75,000 in the provision for administration and general expenses of the Industrial Development Authority and £54,000 for technical assistance. The provision for the payment of interest subsidy to Shipping Finance Corporation Limited shows an increase of £39,000. Increases in other subheads, after taking into account savings used in the Supplementary Estimate for £250,000 passed by this House in March last, amount to £42,655.
There is a decrease of £64,000 in the provision for shipbuilding subsidy after taking into account £36,000 included in the Supplementary Estimate to which I have already referred. There is no provision this year for Castlecomer Collieries Ltd. for which £57,000 was voted last year bringing decreases to £121,000 to which must be added greater appropriations-in-aid of £35,745. The total decrease is therefore £156,655. The net increase in the Estimate is £5,018,000.
The performance of the industrial sector was the main determinant of overall economic growth in 1970. The low increase of 3 per cent in industrial output resulted in the slow growth of total national output in 1970. Employment in transportable goods industries in 1970 rose at a slower rate than in the previous year. The total number employed increased by 3,600—1¾ per cent—in the full year. This pattern has continued for the first six months of 1971 when the increase in employment in the transportable goods industries has been 1,900.
Industrial exports have continued to grow in 1970—the increase over 1969 being of the order of 18 per cent and at the same time constituting 53 per cent of total exports. The Government recognise that our economic growth for 1971 will be below the potential growth rate of the economy and are particularly conscious of the problem of redundancy to which I shall refer later. In order to provide a stimulus to economic activity and to encourage business confidence the Government have announced a reduction in the level of company taxation and have also made available an additional £6 million to the Industrial Development Authority and £500,000 to the Shannon Free Airport Development Co.
The Government propose to publish a White Paper shortly setting out the terms negotiated for our accession to the European Communities and the whole matter will be fully debated in this House. I feel that it would be inopportune for me here today to go into detail on this question but, on the other hand, it would be unrealistic to talk about my Department without at least referring briefly to the impact accession to the Communities will have. Our negotiations for membership have reached the final stages and we are, therefore, on the threshold of an historic era, which will have wide-ranging implications for all spheres of our industrial and commercial life. The overall benefits of membership of the European Communities will be both short-time and long-term, but a point to remember is that much will depend on our own ability to turn opportunities into achievements. Our industrial base has widened considerably over the past decade; an indication of the progress made is that export industries now account for about one-third of total industrial output. We have every reason to feel confident, therefore, that our accession to the Communities will help to accelerate further the widening of our industrial base.
Some people have the idea that Ireland will be "out of her depth" in the European "Big League". To this I would argue that it is the small member States which have gained most from membership of the Communities. The benefits have not been limited to any one member of the Six; they have affected the entire Community, bringing about a great increase in economic and trading activity. I can see no good reason why Ireland should not repeat the success of these smaller countries. It is natural, I suppose, that there should be some apprehension about our joining. Human nature being what it is, there is always nervousness about change and a fear of what is new. It must be remembered, however, that there were similar apprehensions in the present member States of the Communities. These fears, as we know, have been proved to have been groundless and the people of these countries are now glad that they did not heed the prophets of doom.
The stage now reached in our negotiations for entry to the EEC brings into sharp relief the question of adaptation of Irish industry to conditions of free trade. As Deputies are aware, adaptation is a process which has been proceeding for some years now. The pace of adaptation is something that is sensitive to various factors, such as the conditions of trade, technological changes and finance. It is not a matter of achieving a certain degree of fitness for a single big occasion. Rather is it a matter, through continuous endeavour, of striving to reach at least the same degree of fitness as our competitors are likely to have and from there on, matching every improvement that they make. For that reason, it is difficult at any given time to be specific about the adequacy of our efforts at adaptation. True, a great deal of progress has been made over the past ten years in improving the productive efficiency of our manufacturing industry. One has only to compare the figures for our industrial exports for 1970 with those for 1960 to realise this.
But our industry will not be able to get by in the future on its past efforts at adaptation. Indeed, these efforts will, if anything, have to be intensified. In so far as this may not already be apparent, we have been reminded of it by the reports which have been published in the course of the past year-and-a-half by the Committee on Industrial Progress. The industrial sectors covered by these reports, including clothing, leather, paper and printing, fruit and vegetable processing and the metal trades, and by further reports which are in course of preparation can be said to cover a representative area of Irish industry and particularly its older and more traditional elements.
The work of the Committee on Industrial Progress must be regarded as a further increment in the guidance and assistance which the State has provided for the adaptation of industry. In its case, the emphasis is on getting firms to think in terms of the products and markets that are likely to be most advantageous in the changing conditions of the 1970s.
These reports contain a number of recommendations which are addressed to Government Departments and State agencies but, primarily, the message in the reports is one for industry itself and for organisations catering for industry. I hope the message will be taken seriously. There are many facets to adaptation, namely, re-equipment and modernisation; better management; improved technology and training; and greater attention to and sophistication in product policy and marketing. In all of these areas the State can by various services and incentives do a certain amount to spur industry on but, in the last analysis, adaptation, or the progress of adaptation, can only be as effective as the people in industry are prepared to make it.
Eight years ago when the Committee on Industrial Organisation was concluding its examination of Irish industry it saw the need for what it called "a revolution in existing attitudes", if adaptation was to be fully effective. I have already said that there have been considerable changes for the better since that time but the improvements can best be described as uneven and capable of being improved on. That this should be the case is, in my view, due primarily to our being insufficiently attuned mentally to pressing on with the necessary changes. To some extent, this is attributable to a reluctance to face the fact that free trade has become a reality. Fear of the unknown is something many people have and it cannot be denied that, as I have said earlier, there is an element of the unknown in moving into a larger trading area. But fear of the unknown should be a spur to action rather than the reverse.
Our attitude towards the approaching free trade should be neither defeatist nor complacent. Membership of an enlarged EEC will certainly provide us with far greater opportunities than we would have if we were to remain outside the Community. As I have said already the use we make of these opportunities depends on ourselves. We must face the future with a determination to prove that what other people have done successfully we also can do.
The fact that the redundancies which have arisen during the past year are at a rate double that of 1970 and earlier years is a matter of the utmost concern to me and to the other members of the Government just as it is to the trade unions. As Deputies may be aware, the Taoiseach, the Ministers for Finance and Labour and myself have had discussions on this very serious problem with representatives of the Irish Congress of Trade Unions recently and further talks are to be held. There are, however, a number of points in relation to redundancies which I think I should highlight at this stage. Firstly, there tends to be an impression that redundancies arise largely, if not entirely, through the close down or curtailment of activity in manufacturing industry. True, this is a major factor but almost half of the redundancies which have taken place in the past year have arisen in areas other than manufacture, that is agriculture, distribution, services, et cetera. I say this, not in any attempt to minimise the seriousness of the problem, but to put it in its proper perspective.
Secondly, the impression seems to be widespread that the redundancies arising through closures in manufacturing industry were due primarily if not entirely to the removal of protection under the Anglo-Irish Free Trade Area Agreement. I will not deny that the freeing of trade has been a factor in some of these closures but it is only one of the factors involved. Indeed, in some cases it has not been a factor at all. For example, one of the sectors of manufacturing industry where the incidence of redundancy has been greatest this year has been the food industry which, as Deputies are aware, is exempt from the provisions of the Free Trade Area Agreement.
Other factors leading to redundancies have been product obsolescence; difficulties in external markets (a number of well publicised cases of closure earlier this year involved firms which were selling entirely in export markets); market depression externally and at home (this has affected the textile industry in particular); cost inflation; and management difficulties highlighted by more demanding trading conditions and by the incidence of free trade.
In addition to the problems caused by redundancies I am seriously concerned at the incidence of short-time working which has seriously affected the textiles industry, particularly wool textiles, in the course of the past 12 months. Wool textiles as an industry is notoriously subject to cyclical depressions and short-time working but, up to 1970, the industry in Ireland had, for more than a decade, been largely free of this difficulty. However, the industry, world-wide, has recently been subjected to what is stated to be the worst depression for 40 years and this has affected most of the Irish mills in varying degrees. The continuously growing competition from materials made from synthetic fibres and from materials made from processes other than weaving, does not help the situation.
On top of this, there is the fact that excess capacity exists in this industry and, so far, efforts to induce the industry to rationalise its production have not succeeded. One obstacle is the likelihood that no such rationalisation could be achieved without the closure of some mills. Unpalatable though this may be in particular cases. I am afraid that it must be faced. If not, there is a danger that mills, which might otherwise be viable, would be forced out of business along with weaker and less efficient units.
The argument has been put to me that the answer to the problems of redundancy, short-time working and increasing competition from imports which are at present besetting the textile and other industries, should be dealt with by recourse to some form of protective measures. People who advocate this course seem to me to want to have a type of arrangement in which we have complete freedom as regards the outward movement of our exports but can restrict readily the inward flow of imports from the very countries to which we export. This, of course, is not realistic.
Regardless of free trade, however, we cannot expect Irish industry to remain immune from the factors I have already mentioned such as changes in technology, the obsolescence of existing products, and the development of new ones; changes in fashions; and the general tendency for industry to become more capital-intensive. The recently-published reorganisation plans of one of our largest manufacturing enterprises is a very striking illustration of this.
Last year I mentioned the reorganisation of the Industrial Development Authority and the new functions which had been assigned to it under the Industrial Development Act, 1969. The Authority have completed their reorganisation and are now a most sophisticated body, geared to tackle the very difficult task of the development of the industrial sector of our economy. They have set up a new Regions Division which is in the process of completing draft regional plans that will be used as a guide for the regional development of industry over the next five years. Their Research and Planning Division has prepared the framework for assessing future patterns of industrial development and, through their overseas offices and their New Industries, Promotions and Research Planning Divisions, it has been enabled to adopt a more selective approach to the attraction of industries from abroad. The new IDA, with their special brand of expertise, can be expected to operate on equal terms with our competitors abroad for the attraction of industries to our country.
This is not an easy matter but with our attractive package of incentives we should be able to match the success of previous years. I should perhaps mention, as an instance of the pace of development, that last year the IDA operated with a capital allocation of £18½ million, and during the current year the initial allocation of £23 million is, as already mentioned, being increased to bring the figure up to £29 million.
In the year ended 31st March, 1971, grants amounting to about £24 million were approved in respect of 78 projects. These figures include grants totalling £7½ million for projects in the designated areas and grants totalling £16½ million for the non-designated areas. Grants amounting to about £94 million for a total of 847 projects have been approved since the grants scheme was started. The total investment involved in these 847 projects is estimated at over £300 million and the estimated employment potential is 75,800 workers. Of the total of £94 million £32½ million was for designated areas. The total amount actually paid out to date for designated and non-designated areas is £44 million.
The small industries programme, which now covers the country as a whole, continues to make satisfactory progress. During the year ended March, 1971, grants approved amounted to £1.2 million and involved an additional employment potential of 1,140 workers. Since the commencement of the scheme in 1967, the number of grants approved was 593 totalling about £4 million up to March 31st, 1971 and involving additional employment for 7,400 workers.
The re-equipment grants scheme which was introduced with effect from the 1st March, 1968, provided for grants of 35 per cent in the designated areas and 25 per cent in the remainder of the country towards the cost of fixed assets involved in plans for re-equipment, expansion or modernisation. Up to the 31st March, 1971, a total of 1,018 projects had been approved for grants, aggregating £10.9 million of which £3.7 million has been paid. The total capital investment involved is estimated at £46 million. In the year ended 31st March, 1971, 81 grants were approved for the designated areas at a total of £900,000 and in the non-designated areas 363 at a cost of £4.2 million.
Work on the industrial estates at Galway and Waterford continued successfully during the past year. Since this scheme commenced, a total of 916,000 square feet of factory space has been constructed and at 31st March, 1971, 131,000 square feet of factory space was under construction. At the 31st March, 1971, there were 30 firms operating on the estates with a total of 1,123 workers employed. At that date, a further three projects had been arranged for siting on the estates giving employment at full production to 283 workers.
A panel of consultants was set up to advise on the implementation of the advance factory programme of the IDA and a team was appointed to prepare factory plans. The Authority are in the course of finalising a comprehensive programme of advance factories for various areas throughout the country and meantime they have announced an interim programme for the provision of advance factories in about 30 different locations. This programme of advance factories is intended to form part of the overall regional plans for industrial development of the IDA.
Under section 17 (3) of the Industrial Development Act, 1969, an aggregate amount not exceeding £100 million may be provided from the Exchequer to enable the Industrial Development Authority to perform their functions, including those taken over from An Foras Tionscal. At the 31st March, 1971 the aggregate amount so provided was £70,225,446.
Total capital expenditure to 31st March, 1971, on the development of the industrial estates was £4.58 million. The Shannon Free Airport Development Company Ltd., under its new mandate, continues to administer the affairs of the mid-west region, which involves Clare/Limerick/North Tipperary, as well as the affairs of the industrial estate. They are going ahead with the provision of advance factories in preparation for what it is hoped is a continued development of the operations in the area. Admittedly there have been some closures and redundancies in the estate but the company are confident that this was due to a temporary recession—which is world-wide—and that, taking account of projects in the pipeline and others which they hope to attract to the estate, an improvement in the situation will come about within the next year or so.
One of the State aids available to both manufacturing industry and the distributive trades is the technical assistance scheme. It has, as its objective, the promotion of productive efficiency in industry and the increasing of efficiency in the distributive sector. The need to review and adapt the systems and practices of these sectors continued over the past year with the progressive removal of tariff protection under the Anglo-Irish Free Trade Area Agreement and in the light of our expected membership of the European Economic Community.
The technical assistance grants scheme is specifically designed to provide incentives to our industry to cope with present and future pressures. Groups in the distributive trades may also avail themselves of certain services where such services are sought on a collective basis. In addition, grants are available under certain conditions towards the costs of visits abroad by representatives of management and of management and labour jointly.
The Government have, under this scheme, endeavoured to meet their commitment to assist industry in its efforts to prepare for free trading conditions. Those firms in the sectors concerned which have faced up to their responsibilities in up-dating their business methods have had substantial financial assistance from my Department towards the cost of the productivity improvement schemes undertaken. This is evident from the fact that since the scheme commenced in 1957 the total amount of grants paid was approximately £2 million. I am fully satisfied that the expenditure incurred both by the firms and the Government has proved to be a sound investment in helping energetic and forward looking companies to prepare to meet the challenge of the 70s.
The Irish National Productivity Committee was initiated in 1959 by agreement between its constituent bodies and with the full support of the Government. It has the special value of bringing together, at industry level, representatives of labour, management and education. The active involvement of labour is important in encouraging industrial productivity.
In the course of the past year, the Committee have achieved an expansion of the activities of its regional joint committees in their efforts at local level to stimulate firms' interest in the concept of productivity and in developing a climate designed to increase labour/management co-operation. The Distributive Trade Productivity Committee, which is involved extensively in education, training and research was substantially assisted in its work by the INPC advisory service. The Committee engaged in a number of projects, for example, the promotion of productivity ideas amongst students, and these efforts are expected to result in a wider knowledge of the concept and desirability of productivity.
Certain differences of opinion arose in regard to the role of the committee over the past few years and, as a result, a firm of international consultants, versed in productivity matters was commissioned to carry out a survey of the operations of the INPC. The consultants duly reported to the INPC with certain recommendations. Only recently, the INPC submitted to me their views on the recommendations of the consultants and these matters are now under consideration in my Department.
As I have pointed out earlier one of the ways in which industry should prepare itself for the new conditions which lie ahead of it is by improving its technical efficiency. In this technological age, it goes without saying that an industrial concern that is not technologically up-to-date cannot hope to survive. While the main effort in this regard must come from industry itself, a vital role is played by the Institute for Industrial Research and Standards. The Institute's annual report for 1970 shows that recourse by industry to its services is continuing to increase.
In the current year, I am providing £948,000 by way of grant, an increase of £106,500 on the previous year's figure. I am satisfied that the time has now come when substantial capital investment will be necessary to enable the expansion of the Institute to continue at the rate provided for in its first five year plan which was approved some years ago, and as envisaged by the Institute in the second five year plan which was put before me during the summer. I have asked the National Science Council for its views on the plan, but, while I do not wish to anticipate their conclusions, I am aware that the Council agrees in general with the proposition that substantial further growth will be necessary. I will have the whole question examined when I receive the National Science Council's report.
In 1970, following the pattern established over the previous decade, total exports and exports of industrial goods continued their upward trend, reaching record figures. Total exports amounted to almost £468 million. While exports as a whole increased by some 16 per cent, industrial exports showed an increase of 23 per cent over 1969.
The rate of increase in industrial exports reflects further progress towards industrialisation, which is important because it is industrial goods which sell in more distant markets and which will help in attaining a more diversified export trade. Over the decade, total exports showed a value increase of 207 per cent while industrial exports rose by almost 500 per cent. As I mentioned earlier they now represent 53 per cent of total exports.
Export growth in 1970 fell somewhat short of expectation, partly because conditions in the British market did not improve as much as had been hoped and also because of a decline in buoyancy or depressed trading conditions in other markets. Nevertheless, there were increases in all sectors, and manufactured goods showed an increase of just over 20 per cent. These goods are still the fastest growing category. They amounted to £199.1 million, as against £165 million in 1969. There were increases, also, in exports to all the main markets, including USA, and the EEC countries. Diversification of markets continued and, in 1970, about 37 per cent of all exports went to markets other than Britain.
In the first half of 1971 all classes of manufactured exports continued to grow, showing an overall increase of about 25 per cent. Exports to Britain in particular showed an upward movement, increasing by some 28 per cent. Provided that we can maintain competitiveness in cost, there is every reason to feel optimistic about the future, in Europe and in other export markets.
Total domestic exports to Britain and Northern Ireland continued to increase in 1970 and a more favourable balance of trade is now evident. Developments in both imports and exports are being kept under review. In the context of free trade, of course, the effective answer to rising imports is an increase in exports, and this applies to trade with Britain as well as trade in general.
Provisions exist within the Anglo-Irish Agreement for seeking remedial action in the case of any particular sector of industry which may be seriously threatened by increased imports resulting from the operation of the Agreement. During the year ended in June last the review provided for in Article 1 of the Agreement to identify sectors of industry where particular difficulties may have been caused by the operation of the Agreement, was carried out. Following discussions with the UK authorities interim arrangements for the modification of the rhythm of tariff reductions in the case of a number of products were put into effect. Details have already been published and I need not repeat them here. Discussions with the UK authorities aimed at reaching agreement on more long term measures to deal with the difficulties should be completed shortly.
In 1970 Irish exports to the USA were valued at £60 million. This was equivalent to 13 per cent of our total exports to all areas, with the result that the USA is now, after the UK, our next most important market. In the circumstances the pressure by US industry for further restrictions on imports has continued to be a matter of concern for Irish exporters.
In 1970 legislation restricting the importation of textiles, clothing and footwear into the USA was a serious possibility, which fortunately did not materialise. However, so far this year quota restrictions have been imposed on the importation of stainless steel flatware and certain sugar and chocolate confectionery products. The most serious development, however, for exporters to the USA has been the series of economic measures announced by President Nixon in August. These include a 10 per cent import surcharge on all dutiable items not subject to US quantitative limitations. The surcharge applies to about two-thirds of our exports to the USA and could seriously affect some at least of these. In the circumstances it was decided to introduce more liberal conditions for the provision by Córas Tráchtála of travel incentive grants for the US market for exporters affected by the surcharge.
In addition, Córas Tráchtála will keep in touch with exporters to the USA with a view to assisting them to overcome any problems they may meet with. I understand that following the introduction of voluntary export controls by Japan and other suppliers to the US markets the US Government proposes to remove the surcharge on textiles; this is a welcome development. We are maintaining close contact with the US authorities in an effort to secure the most favourable possible arrangements for our sugar confectionery products under the new regime being introduced by the US.
Trade agreements were concluded with Bulgaria and Rumania in 1970 and 1971 respectively and talks to review the operation of the trade agreement with Bulgaria are to take place shortly. Talks about the development of trade have taken place between Ireland and the USSR, Poland and Czechoslovakia. Further discussions regarding trade with these countries, including the question of possible trade agreements, will be arranged.
During the past year Córas Tráchtála have continued to assist, financially and otherwise, an increasing number of exporters. The operation of the special diversification measures which I have already mentioned has brought about a noticeable increase in overseas promotions. In 1970, Córas Tráchtála dealt with well over 1,000 firms, a quarter of which participated in 25 co-operative promotional activities such as national pavilions, group showings, and so forth, some of which were held in Britain, North America and throughout Europe. The business placed at these amounted to £2 million with a potential follow-up value of £6 million. Comparable figures for 1969 show that almost 200 firms participated in 20 co-operative activities realising £1.5 million with a potential follow-up value of £4 million.
Córas Tráchtála are the Government agency responsible for development of industrial design and the promotion of design standards in Irish industry. Their design section provides a wide range of design services for industry, including incentive grants covering design consultancy and package design and design training, as well as consultancy, advisory and information services—such as the maintenance of a register of design consultants and a technical reference library.
One of Córas Tráchtála's early steps in design development was the setting up of Kilkenny Design Workshops Ltd., as their subsidiary, to provide design and prototyping services chiefly for craft-based industries. The Design Advisory Committee, which was set up on the initiative of Córas Tráchtála, has resulted in a further strengthening of liaison with industrialists and other bodies concerned in design development. It is most advisable that exporters should make the utmost use of both these services. Many exporters, in this country particularly, must depend to a great extent for continued export success on the attraction of high-quality goods which can retain their place in world markets against competition from cheaper mass-produced articles.
The Export Award Scheme was introduced in 1968 and has been continued on an annual basis since then. The scheme is intended to give State recognition to successful effort in exporting. The stress laid in the criteria on design, product development and adaptation, modern marketing methods and general enterprise further emphasises the importance of these factors from the point of view of export development.
The Government have extended, for a further period until April, 1972, the operation of the Prices Stabilisation Order, 1965 under which I am empowered to investigate and control prices and charges. Deputies will be aware that, last month, I established the National Prices Commission to keep under review prices and charges and to advise me in relation to all prices and charges. The commission has, as its members, representatives of employers, traders, workers and consumers with an independent chairman. All proposals to increase prices will be submitted to the commission for consideration and the commission will furnish me with a recommendation on each such proposal. In addition, the commission will furnish me with monthly reports on the cases and other matters dealt with by it, and I will publish these reports.
As Deputies are aware, I introduced, in July last, a Bill to extend the scope of the Prices Acts. I hope to have the Bill circulated to Deputies in the near future. This Bill will, in the main, extend the Prices Acts on the lines envisaged in the Prices and Incomes (Temporary Provisions) Bill, 1970, and will cover such areas as new houses, professional services and insurance charges.
Deputies may be interested to know that in the 12 months from October, 1970 to September, 1971, I indicated in a total of 339 cases that I would raise no objection to certain price increases to compensate for unavoidable cost increases. The total of the cost increases claimed by all the applicants in these cases was roughly £49 million. The total of allowable cost increases in these cases as computed by my Department, was about £33 million and the total of compensation given to the applicants by way of price increases was £32 million. In this period of 12 months, therefore, the price increases conceded by me represented, on average, only 65 per cent of the cost increases claimed by applicants.
With the advent of free trade I cannot over-emphasise the urgent necessity for management in all concerns to explore every possible prospect of increasing productivity, and to keep existing procedures under continuous review with a view to effecting progressive improvements towards this end. I must also ask workers to lend their wholehearted co-operation to management's efforts in this regard, so as to enable the maximum amount of unavoidable cost increases to be absorbed and thus mitigate the effects of these cost increases on prices and on the cost of living.
It is generally recognised nowadays that the law must provide the consumer with certain additional forms of protection which, in modern conditions, he is no longer able to provide for himself. There is, of course, already in existence a large body of law aimed at giving protection to the consumer—I may mention the Weights and Measures Acts, the Merchandise Marks Acts, the Sale of Goods Act, the Food and Drugs Acts, the Hire Purchase Acts and the Prices Acts amongst others. New conditions require new measures, however, and my predecessor announced some time ago a programme of consumer protection which would be undertaken. Progress has been made through the reactivation of the Merchandise Marks Commission and, in particular, with the passage last year of the Merchandise Marks Act, 1970, which provides for the marking of quantities on prepacked goods, a most necessary requirement today. It is my intention to make a very comprehensive order under this Act, and consultations have taken place with a wide range of manufacturer, distributor and consumer interests on the details to be included. I expect to be able to make the order shortly. I have also made arrangements which should enable good progress to be made with other aspects of the programme in the time ahead.
Last year I indicated that legislation to amend and consolidate the Restrictive Trade Practices Acts was in course of preparation. The amending Bill was introduced in the Dáil by long and short Titles in July and I expect that the Second Stage will be taken during the current Dáil session. The Bill has two main features— extension of the scope of the legislation to services, including professional services, and the introduction of institutional changes, chiefly the creation of a special post, the holder of which will be given statutory powers to exercise the investigatory functions hitherto discharged by the Fair Trade Commission. These changes will mean that the whole range of commercial activity, with a few exceptions for services already subject to separate legislation, will come within the purview of the commission. In addition they will provide for more speed in the operation of the legislation and ensure that the commission can undertake inquiries with the appearance, as well as the reality, of complete detachment.
I am preparing legislation to provide for the investigation and control of monopolies, take-overs and mergers. I feel that these powers should now be made available in present circumstances of ever increasing concentration through mergers and take-overs in manufacturing industry and distribution. I recognise, of course, that the circumstances of Irish industry are such that some re-grouping of firms is necessary, and it is not my intention that the proposed legislation should inhibit such necessary restructuring of industry.
The proposals I have in mind would enable me to make orders providing for the prohibition of a merger or take-over or, in the case of monopoly, completed take-over or merger, for the breaking-up of a business by a sale of assets or otherwise. The criterion to be applied would be whether a monopoly, take-over or merger restricted competition in a manner contrary to the public interest.
The distributive trades form a highly complex and fast changing sector of the economy. The rapid growth of supermarkets and multiples in recent years has given rise to fears that the days of the small independent trader are numbered. However, all the evidence points to the fact that efficiency is the key to survival and that the efficient trader has nothing to fear. It will continue to be my policy to ensure that there will always be a place in the distributive sector for the efficient and competitive small and medium sized business.
There has been an amount of discontent in the distributive sector, and particularly in the grocery trade, about a number of practices which have become common in recent years and which some traders consider are unfair or even anti-social. The Fair Trade Commission has carried out a very painstaking inquiry during the year into conditions in the grocery trade, and I am awaiting its report, which, I feel, will be one of more than usual significance for Irish distribution. While I cannot, of course, come to any specific conclusions in advance of the commission's report, I may say in general that, where the report indicates that action needs to be taken, I shall be very ready to take such action as is open to me, specifically, of course, the making of an order.
I have had the opportunity on a number of occasions during the year of meeting representatives of various branches of the distributive trades, and of the Federation of Trade Associations with its overall coverage. I have made it my practice to try to keep before their minds that it is not only their national duty but their personal interest to "Sell Irish" wherever there is a suitable Irish made product available. I am glad to say that the majority of traders seem to appreciate the force of this truth but there are still some who do not or will not recognise it. The message is one which I must keep hammering home.
The change-over to the metric system of measurement is making satisfactory progress in a number of sectors. Quite a few of the main industries have done most of the work of changing over; for instance building, pharmaceuticals, flour milling and paper making. Many others are well ahead with their arrangements. There are still, however, a number of areas where there does not seem to have been much progress. I am aware that some industries feel that the change-over can be effected with very little preparation as soon as trading conditions make it desirable and it is not at present my policy to dictate to industries how or when they should effect this change. Accession to the EEC may, however, render it necessary to accelerate the change; meanwhile, industries should in their own interests, re-examine their position. The prospects are that the metric system will be in general use in Britain within a few years. The existing members of the EEC already use it. A very high proportion of our trade will, therefore, be with countries that use metric measurements and it would be foolish for us not to follow suit.
Problems may exist because of the close inter-relation between industries, and one sector may be held up because of lack of progress in another. For this reason, a committee was set up under the Minister for Local Government and An Foras Forbartha to facilitate the introduction of metric measurements in the building and building supplies industries. I have set up a committee to help with the problems of distributors and consumers and the officers of my Department help to smooth out liaison problems which may arise in other sectors. I propose in the near future to introduce legislation to give legal validity to the national prototype standards for metric measurements.
The volume of insurance business has continued to expand. Total premium income increased from £40 million in 1965 to well over £60 million in 1970. The increasing cost of claims in fire insurance and motor insurance and the high level of premiums in these sectors has been causing me considerable concern. The Committee of Inquiry into the Insurance Industry, which was set up a little over a year ago, is pressing on urgently with its examination of motor insurance and has made considerable progress. I understand that the report on motor insurance should be available within a matter of a few months.
There is no slackening in interest in minerals exploration and development. Some 633 prospecting licences were current in mid-October, 1971, compared to about 650 at 31st December, 1970. Exploration activity is now becoming intensive with companies concentrating on the detailed investigation of small areas rather than general surveying of larger areas. Some 383 applications for prospecting licences were received up to mid-October, 1971, compared to 367 in the whole of 1970.
Total production of concentrates in 1970 at the lead/zinc/silver mines at Tynagh, County Galway and Silver-mines, County Tipperary and the copper/silver/mercury mine at Gortdrum, County Tipperary amounted to 374,540 tons and exceeded that of 1969. Due mainly to a sharp decline in metal prices and to marketing difficulties experienced by one mine, the financial return was less than expected. Nevertheless, the value of exports of metal ores and concentrates in 1970 was £18.5 million compared to £17.3 million in 1969. Production commenced in mid-November, 1970, at the re-opened copper/pyrites mine at Avoca, County Wicklow and the mine has commenced trading. To supplement the underground source of ore, the operators have proposals to mine open-pit material from one area of the deposit. Other discoveries, including a promising lead/zinc deposit at Nevinstown, County Meath, are still under detailed investigation. The value of exports of barytes rose from £929,710 in 1969 to £1,122,000 in 1970.
There is considerable interest in petroleum exploration and development in the country's area of continental shelf. Under the terms of the 1959 Oil Agreement, as amended, Marathon Petroleum Ireland Ltd. hold exclusive petroleum exploration and development rights in three offshore areas. Following completion of detailed seismic surveys, the company were granted petroleum leases in 1970 in respect of areas off the coasts of Cork and Waterford. The company has drilled three test wells in these areas. As the Deputies are aware, Marathon has announced that the latest drilling about 28 miles from the Old Head of Kinsale has revealed apparently significant results from an initial test of a gas zone and that further testing will be required to properly evaluate the well's potential. While considerable further exploration will be necessary before it can be established that there is in this area a gas field capable of commercial exploitation, this is encouraging news and if a commercial gas field is proved it should be of great benefit to our economy.
Non-exclusive petroleum prospecting licences for general surveying of the balance of our designated shelf area are about to be granted to 16 companies. Re-organisation and expansion of the Geological Survey to meet the present and future needs of mineral development in this country are proceeding.
The sum provided in the Estimates under the head of shipbuilding subsidies for the year 1971-72 is £150,000. This is a continuation of policy which has existed since the establishment of Verolme Cork Dockyard. The total subsidy payments which have been made since the inception of this scheme up to 31st March, 1971, is £1.5 million. The subsidisation of shipbuilding is a general practice throughout the world and the present level of subsidy here is less than that obtaining in many countries where shipbuilding is a major and long-established industry. The employment given at Verolme Cork Dockyard is substantial and the building of new ships is the main factor in maintaining this. The shipbuilding facilities at Cork are at present fully employed.
Shipping Finance Corporation, a subsidiary of the Industrial Credit Company, has for a number of years been making loans at low interest rates to shipping companies to finance the purchase of new vessels from Irish shipyards. It is necessary to recoup the Shipping Finance Corporation to the extent of the difference between the rate charged on these loans and their borrowing rate plus something for out-of-pocket expenses and to build up a reserve. A provision of £100,000 for interest subsidy is made in this year's estimate.
The past year has been one of mixed fortunes for Irish industry. On the one hand, our rate of growth has slowed up in line with what has been happening in other countries around the globe and redundancies have increased in number. On the other hand, if the rate of growth is not quite as fast as before, industry is continuing to grow and there are signs that the rate is accelerating once more. A particularly bright spot has been the growth in industrial exports. There can be no doubt that the end of the year will show a substantial net increase in the numbers employed in industry and distribution.
In this speech I have outlined the principal ways in which I am helping, through my Department and the various bodies under its aegis, to speed up development. I have already indicated that it is intended to make additional money available during the year for industrial development. I shall be presenting a Supplementary Estimate in due course for this purpose, but meanwhile I commend this Estimate to the House.
