Deputy Molloy gave notice this afternoon of his intention to raise a matter on the adjournment and I granted approval. When the Minister is present we will proceed.
Adjournment Debate. - Galway Glass Factory.
I could answer for the Minister what Deputy Molloy wishes to know. I can tell him that we have rescued that factory.
I thought all the monkeys were in the Zoo.
The dry rot set in when Deputy Molloy was a director in it. That is when it fell.
We have had a most orderly Assembly up to now and let us not mar it.
Facts are facts, with all respect to the Chair.
I should like to express my gratitude to you, Sir, for allowing me to raise this matter at this time and I am grateful also to the Minister. I shall try to be as quick as possible. I am speaking on behalf of the 200-odd workers employed in this factory. I appeal to the Minister and to the Government to keep the factory open and to continue efforts in the meantime to dispose of it to a suitable purchaser who will continue the business carried on in the factory.
At this stage I consider myself obliged to give a brief history of the factory. This factory was started by a group of members of the Galway Junior Chamber of Commerce who decided, about 1966, to undertake a project which would provide badly needed employment in the town. A company called Western Holdings Limited was founded with 17 shareholders, each of whom contributed £10. The company was established to carry out a survey of possible industry for the area and, eventually, they recommended that a glass-cutting factory be established. The shareholders in Western Holdings were invited to become shareholders in the Irish Crystal Glass Company, Galway. Of those, about 11 accepted the invitation and each took 200 shares in the glass company at 25p each. Seven of these 11 were appointed directors and they have managed the company since. They have increased their shareholding in the company, some of them to a substantial extent.
At this point I wish to declare my personal interest in the company. I was one of the 17 shareholders in Western Holdings Limited who invested £10. Subsequently I was one of the original 11 shareholders in the glass company who invested £50. I was not a director and my shareholding remains at 200 shares at 25p each. My concern here is not for the £50 worth of shares which I hold and which are recognised to be lost anyway, although I am proud to have been associated with the small beginnings of this factory. My nominal investment was made to help establish an industry in my constituency.
The position is that a receiver was appointed on 9th April, 1974. To date he has failed to dispose of the factory and recently he issued notice of the termination of employment to workers in the blowing section for Friday, 28th June and for 12th July for workers in the cutting section and for the management. Yesterday morning I was able to inform the workers action committee that the receiver had agreed to extend the closure date for all workers and management to the 28th July.
The Deputy was late because I did that the day before.
The day before was Sunday and they did not know of the extension until Monday morning.
Order.
In the event of the receiver not having disposed of the factory before the 28th July I understand that it will close on that date. In the time available to me now I wish to appeal to the Minister and to the Government to save this factory from closure. I am asking that the State intervene and that the services of Fóir Teoranta be made available to help rescue the company. The employment in the factory at present is 168 males and 26 females, making a total of 194. The factory has received IDA grants which have totalled £120,000. The company produce high quality hand-cut crystal glass. The sales record of the company, which was established in 1967, has been one of remarkable growth and expansion. In the few months of the existence of the factory in 1967, sales totalled £4,210. In 1970 the figure increased to £179,866. In 1973 sales totalled £383,465. That is a minimum figure. I expect that the audited figure will be higher because there is also a US company involved in selling these products in the States. Of the goods produced at the factory 70 per cent are exported while 30 per cent are sold on the home market. As we know, the sales on the home market are to tourists mainly so one could say that the bulk of the goods manufactured in this factory are exported, either directly or indirectly.
In April, 1974, the position was that orders on hand totalled 53,000 pieces of glass. That is equal to about ten weeks work in the factory and shows that the on-going prospects for the factory are good. The product has always sold well. Its quality was first class and there have never been any complaints in regard to it.
I should like to quote from a consultant's report, dated March, 1974, which refers to some aspects of the Galway Crystal products and their sale on the US market. I am quoting from a brochure issued by the receiver.
A study of this market was carried out by consultants in March 1974. It concluded that
1. Galway Crystal had become an established brand name, so much so that customers were asking for Galway by name.
2. The range of products produced by Galway was sufficiently broad. The design of Galway Crystal was termed distinct, unique, and beautiful, comparable with the highest quality products in lead crystal glassware.
3. The quality was rated high...
It goes on to say that Galway Crystal surpassed other brand names in the opinion of buyers and it continues:
4. The US market for cut crystal was growing at 10 per cent-15 per cent p.a. and cut crystal would remain in vogue for the foreseeable future.
5. The US operation could triple its sales volumes, from £400,000 to £1,300,000 by 1980 (and double by 1977)....
Therefore, the consultant's report seemed bright and the prospects for the factory seemed good. There are other consultants' reports in relation to this factory. These consultants and the receiver, also, who has been there since April, 1974, have given as their considered opinion—and they have wide expertise in this field—that the factory can be made viable economically within a 12-18 month period. At present, as the Minister will appreciate, the investment climate is not conducive to a successful sale but I would emphasise that there is now a great need for State aid to keep the factory open and in operation until such time as the private investment climate improves. The total assets of the company are estimated to be £500,000. If a sale could be concluded now the figure which would be realised would in no way bear any relationship to the real value of the assets of the company. Therefore, in view of the heavy investment of Irish labour and of Government investment in this factory it would be a great tragedy if the assets should be sold at a cheap rate. Worse still, we are faced with a threat of closure of this whole plant.
I should like to quote to the Minister a precedent for a case such as this. In 1967 a factory in the Galway area, Galway Textile Printers Limited, were in difficulties of a similar nature. Indeed, there were no cheerful forecasts for the future as to their economic viability, but to protect the employment of workers and in the hope that a sale might be concluded successfully at some date in the future, the then Minister for Industry and Commerce, with the sanction of the then Minister for Finance, gave a gurantee that the losses would be met by the State in the order to ensure that the factory would continue in operation and that employment would be maintained. Looking back we know that that guarantee saved the factory on that occasion. Recently in this House a Supplementary Estimate was passed involving a sum of £1 million to cover the commitment made to Galway Textile Printers.
I hesitate to interrupt the Deputy but I would point out that it is the convention of the House that if at all avoidable we do not refer by name to firms. I appreciate the point the Deputy is making.
The name of the firm has been quoted already in the newspapers and I consider it necessary to quote it here by way of precedent for what I am asking the Minister to do in relation to the glass company. I am asking him to do a similar type of rescue operation for the glass company on this occasion as was done in the case of this other factory. This debate began earlier than I had expected. I had hoped to have further references in relation to the other factory and to give the Minister some quotes.
The Minister is probably aware of how the Galway textile factory was saved by the then Minister for Finance. On behalf of the workers, their families and the people of Galway, I am asking him to rescue the glass factory. A bright future was forecast for it. It would be a great tragedy if it was allowed to close down. The Minister may correct me if I am wrong, but the IDA have been holding back training grants to the amount of £100,000 and also a £15,000 capital grant and the EEC social fund could contribute towards the cost of the training of workers. This is a source of finance which could reduce some of the overheads and keep the factory on its feet.
The factory has experienced very rapid growth. The construction of the blowing plant has drawn heavily on its financial resources. Under-capitalisation has led to the present difficulties, as well as the heavy training period which has had to be undertaken because of the rapid expansion and the increase in the numbers employed. Another factor in relation to the present difficulties was the untimely death of a new director who was appointed in February, 1973.
I do not want to raise any hackles about this. I want to make a very sincere plea, on behalf of all the people concerned, to the Minister to help to avoid the closure and to save the jobs which are available. The men working in the factory are being paid some of the highest wages of any craftsmen in the west. The factory has been a shining example to other areas in the west as to how they can establish a factory themselves. It had small beginnings. It started with a few pounds thrown together by a few of the lads. I was happy to be one of those. I got nothing out of it. I have no interest in it other than the few shares I have already mentioned which are of no consequence to me. I am concerned that 200 men, many of whom are young, married men with children attending schools and who have settled there and are paying off mortgages and trying to meet the high rise in the cost of living, are now faced with this very bleak prospect in that one of our most successful industries is being allowed to go by the wayside because of possible Government inaction or disinterest.
I would like an assurance from the Minister that he will take a more serious view of this situation than has been evident up to now. I understand that Deputy Coogan, who is sitting behind the Minister, visited the factory last week. Senator M. D. Higgins also visited the factory recently. A deputation, possibly arranged by one of those men, travelled to Dublin to the Department of Industry and Commerce in the expectation of meeting the Minister to discuss their problems. I am disappointed to say that the two public representatives did not think it worthwhile to accompany the deputation. They were allowed to travel to Dublin without any guidance from any public representative who would have better knowledge of deputations than they would. They were met by a principal officer of the Department of Industry and Commerce and others. I do not consider this satisfactory.
It is not too late to save the day. The fact is that the receiver and those he represents—the Bank of Ireland, who are heavily involved in the financing of the company—have agreed to allow an extension of the closure date. The Minister had nothing to do with it. This was done with the permission of those whom the receiver represents. The receiver himself agreed. Thanks are due to those persons for the few days' grace given up to 28th July.
Some positive Government action should be taken within the next three weeks. Leaving it to the very last day is not fair to the workers, the management, Galway or the west. If the death-wish is going to hang over this factory for the next four weeks many of the workers will avail of whatever opportunity comes their way. Some of them may emigrate before 28th July. Already, because of the possible closure of the factory, some workers have left to find jobs elsewhere.
If this wonderful craft industry is allowed to close this will be a blow to the confidence of the people in the west. It will be a great loss. It is a great revenue earner for this country, as is evident from the sales to the US. The quality of the glass produced in the Galway factory is of the highest standard, in the opinion of the consultant. The buyers in the shops say that it is better than any other crystal glass cut in any part of Ireland. A wonderful reputation has been built up. Great care has been taken to build up that reputation. Because of undercapitalisation following the rapid growth I would expect that the Government would be aware of the facts and would not allow the receiver or any other person to come in and destroy something which has been so carefully built up. Tears and sweat have gone into the building of this factory. It started in a small backyard. Recently massive plant has been installed. The factory is now concerned with the blowing of glass——
You should join them.
The House will appreciate that I do not come here often appealing to the Government to save industries. We have not had occasion to do that. Factories have closed since the Coalition took office last year. In all these cases I have studied the facts. I have arrived at what I hope is a responsible decision in each case. If I felt there was nothing but closure for it I would accept that, even as a member of the Opposition. I will not make a political football out of a factory which has to close. This is the first case of this kind which I have brought before the House.
I am convinced that a great tragedy will take place if some measures are not taken to guarantee the continuation of this factory. A period of 12 to 18 months with a certain amount of capital investment in certain areas would help. The workers have promised that they will try to increase production and will apply themselves even more than they have up to now in order to keep up the high quality and to produce more products. They are prepared also to make sacrifices. These have been indicated to me and I expect they will be issuing a public statement themselves.
This matter has been left lie quietly up to now. The closure that was nearly sprung on us for Friday came as a surprise to most people in Galway. The impression was abroad that the receiver was in a position to sell to a proper client, somebody interested in glass manufacture and glass-cutting who would guarantee the employment of the men and women there. It was only within the last few days that the workers became aware that the prospect of a sale was nil, and that the other prospect was closure.
I hope I have given the Minister some idea about the concern in Galway about this matter. I now make a special appeal to him to offer something in relation to Fóir Teoranta, or a rescue operation. He should give us a guarantee that the factory will not close on 28th July and that he will do what the Finance Minister did for the textile factory in 1967. Do not close the factory now.
The Minister, to reply.
I would like——
I understood I had 20 minutes and the Minister had ten minutes. If I am——
I am happy to give Deputy Coogan two minutes and I will speak for eight.
By bringing up this subject Deputy Molloy has done a great disservice to the factory at a delicate stage in negotiations. He tried to cash in——
I said what I have said at the request of the workers.
(Interruptions.)
We must have an orderly discussion.
We rescued one of the Deputy's own factories in Galway. Will we be rescuing Fianna Fáil factories all over the place? The Minister is active and will rescue this factory. I know good work is being done there by dedicated workers. A deputation of 200 came to me, not to Deputy Molloy. I arranged for them to meet the Minister and I am very pleased to say that they are grateful to him for what they learned.
I should like to go further. The dry rot set in when the Deputy was associated with this firm. The rot did not start at the ground level but at the top. I do not wish to take up too much of the Minister's time although I could say a lot more and Deputy Molloy would have a red face when I finished. I will leave it to the Minister to confirm what I have said.
This is a profoundly serious subject. For anyone to suggest that it was a matter of recent concern is nonsense. My personal involvement dates from my campaigning in Galway at the time of the presidential election, which was a year ago. It has been of continuous and on-going concern to me for that length of time and to my Department and the IDA for a longer period.
I regret that this subject was raised now. I do not think it is helpful and the points conveyed by Deputy Molloy are not accurate in a number of ways, and, indeed, damaging in a number of ways.
I want to deal, first, with a form of words which he used towards the end of his speech. Having foresworn the desire to raise hackles at the beginning, I thought we would get a serious contribution. Instead we got a distortion of facts, a glossing over of difficulties and ultimately, a pubthumping close which was the exact opposite to any avoidance of hackleraising. The statement that the prospect of a sale is nil is scandalous and irresponsible and contrary to the facts. It is damaging to on-going negotiations to utter it in this House or anywhere else at this time. To make such a statement is an irresponsible and disgraceful thing to do. It may not succeed but the Deputy has not helped it by his escapade tonight.
I should like to talk a little about the firm's history. I am being continuously constrained by my desire to avoid damage to the company and guarantee the outcome which, whatever our disagreement about approach, I know Deputy Molloy wants as seriously as I do, and that is that this factory will continue to grow, prosper and make a good product for years to come.
Deputy Mollow knows as well as I do, or possibly better, that while the details of the early history of the firm are accurate, in September, 1972, an external auditor informed the IDA that he had uncovered serious irregularities in the company's affairs. Omitting that in the presentation of this success story is irresponsible. It was precisely at that stage, without my going into details, again for reasons which Deputy Molloy will appreciate, that all grant payments were frozen. What else can one do in the apportioning of public funds if there is to be accountability? As soon as it was possible to resume detailed negotiations with the firm that was done. But a significant amount of time at a delicate period was lost not the fault of the workers, and not the fault of any State organisation. At that very delicate time there was no option but to freeze availability and when that was over there was a resumption of negotiations.
Again, I do not wish to give detailed figures although they are before me, because they would be unhelpful. We have had a glowing account of this firm which was described as "one of the most successful industries" and "a shining example". Deputy Molloy knows there was a profit in 1970 and 1971 but the loss in 1972 amounted to those two profits. In 1973 there was a considerably larger loss and in 1974 there is a prospect of a larger loss again. A good prospect, yes; a good image, yes; good exports, yes; good profits, no. One cannot continue throwing more and more money down a hole indefinitely if the management is inadequate and the profits are not there. To talk about the excellence of the products, and the growth of the exports, with which I agree, and not mention mounting losses is again irresponsible because it does not present an accurate picture. I do not want to go into detail but those are the circumstances.
Now let us talk about what has happened, because the State has been involved for some considerable time. Deputy Molloy's figures about moneys due are widely inaccurate and wildly inflated. He will know from his own time in Government that there is an approval of a grant by the Government, if it is above a certain level, otherwise it is approved by the IDA. The moneys are only paid for fixed assets and if the assets are installed. The grant is only due even if it has been approved on what is installed. The amounts payable on fixed asset investment which actually took place were very much smaller than the Deputy indicated.
I do not want to produce here and now details of sums of money which have been expended by the State; it is enough for me to say that a sum of money five times as large as that due under fixed assets investment was made available very recently as a training grant. It is sufficient to say that many months ago without the IDA training and fixed asset grants the firm would have closed. It has been given a considerable lease of life due to the maximum possible effort by the IDA to make moneys available to it.
Furthermore, the matter of Fóir Teoranta is under continuous examination. There have been very vigorous efforts by the IDA to find someone to take it over as a going concern. We can only do that, though, if we describe the situation as it actually is and not give it fanciful descriptions of success which are not there. We will have to tell the truth to in-coming purchasers. Very vigorous efforts by the IDA are being made to find a purchaser.
Deputy Molloy knows from his own time in Government that Fóir Teoranta can only become involved if there is a viable proposition, but I can point to the benevolence of Fóir Teoranta and their willingness to participate in a viable proposition, and I can put it on record that they were always anxious for a viable proposition. The IDA are straining every efforts to find a purchaser. They have paid as much in asset grants as they possibly can and the firm has been kept going considerably longer than would otherwise be the case.
All those efforts are of very little satisfaction to the workers in Galway —almost 200 highly skilled people. I sincerely want, as does everyone concerned with this enterprise, a long life, a great reputation, growing production over many decades for this firm, but there has been a difficult time—not made by explosive growth, so that there was a cash flow shortage—due to management defects of a serious kind about which Deputy Molloy knows as well as I do.
I agree, but what about the jobs of the men?
For more than a year —in my own case for a year, in the case of the IDA for more—we have done everything we can do. We have retained the possibility of its being bought as a viable going concern by keeping it going so long. Indeed, to dismiss its staying open until 28th July as "a few days" grace" is a contemptuous dismissal of more than a month.
That is all it is— contemptuous.
It has more than another month of life. They called it a few days' grace. That is the sort of distortion, the sort of fishing in troubled waters, the sort of concern not to rescue the jobs but to paint a bogus position of the real state of the company and then to make political capital out of it in an irresponsible way——
The Minister is only a sham. I am interested in the jobs of the men.
This is all bogus and hypocritical. If the Deputy had been interested in the jobs of the men he would have shut up. It was a piece of bogus vote-catching to raise this in this way. No possible good can come from it. Harm can come from it. The Deputy is fishing in troubled waters in a hypocritical, vote-catching——
I am not a hypocrite. I am only speaking for the workers.
Nothing is being helped by raising this here.
The Minister is a disgrace.
The Deputy got 20 minutes to make his case. Will he now permit the Minister to reply in the ten minutes he has been given?
Deputy Molloy does not give two hoots about the workers. What about Carraroe?
The difficulties are not of our making. The fact that the firm is now open is the result of the efforts of my Department and of the IDA. Every possible avenue is being explored, not without hope, and now we have this very damaging statement that there is no chance of saving it. The situation is under continuous consideration. If Deputy Molloy and others over whom he may have some influence really want to help, what they should do is quietly to seek for serious participants in the enterprise. They will be welcomed by Fóir Teoranta and by the Department and they will be given every possible help. We are doing everything we can think of——
Such as?
We view the closure of this undertaking with great distress but we are hopeful it may not have to happen. If it does happen it will be the responsibility of people who did not discharge their duties at a crucial time. It is not possible to transfer the responsibility on to the State or the workers or any other group. The story is not over. Very active work is going on and it serves no purpose at this moment to exhibit these difficulties and this travail in public. What is needed now is continuing, quiet negotiation.
The Dáil adjourned at 9.45 p.m. until 3 p.m. on Wednesday, 26th June, 1974.