——the reaction on both sides of the footwear industry to their meetings with him when they described those meetings as cordial but totally unproductive. The Minister should be aware that, for the past 18 months, the footwear industry has been plagued by the twin evils of redundancy and short-time working to the extent that the foundation of the industry is being seriously undermined. Unemployment coupled with short-time working means low output, and low output ultimately results in an industry passing the point of no return and being no longer viable.
Over this 18-month period I have been speaking of, hundreds of workers have become redundant in the footwear industry. Few factories have escaped. The plight of the people concerned, and of their dependants, is grave, facing life, as they are, in a world of escalating prices on a considerably reduced income, a situation which will become worse in the months ahead as those involved are only too well aware. At least the transition from employment to unemployment is cushioned by redundancy payments and by pay related benefits both of which, of course, were introduced by a Fianna Fáil Government. They are cushioned at the beginning of the unemployment period.
The loss to the economy in the various towns and to the economy of the country generally is tremendous. The country cannot afford the loss of valuable skills developed over many years. During the same period, most of the factories in which there were redundancies had also short-time working for months on end. Some of the short-time working was little better than total unemployment. Taken together, both the redundancies and the short-time working triggered off unemployment in many other areas because of the loss of the purchasing power of the boot and shoe operatives.
Clearly then, it is vitally important that action should be taken by the Minister immediately if this deteriorating situation is to be halted. The main cause of the problem is the vast increase in footwear imports generally. One has only to note the regular and rapid increase in the number of pairs of shoes imported over recent years, both as regards volume and value, to see that the home market is in the course of being eroded. When one compares the relatively much slower increase in our exports of footwear, it is easy to understand why the industry is in difficulties. Because the circumstances in which certain factories find themselves might be different, their reactions to solutions may also be different. Nevertheless, it is recognised by all that the enormous increase in imports of footwear is the key problem.
Some years ago exports of Irish produced footwear were approximately five times greater than imports. There were 1,522,000 pairs exported as compared with 309,000 pairs imported, but this year it is estimated that the volume of exports of footwear will be less than the imports. The comparison between the two situations underlines the gravity of the position. A great problem is the importation of footwear from low cost countries, whether direct or indirect. Some time ago it was felt by management that these imports would not constitute a danger to home produced products because of the fact that the quality of the Irish footwear was much superior. The belief that low cost goods would not pose a threat is not the reality of the situation as the latest import figures show.
The Minister, when speaking at the Shoe Fair, departed from his script and promised to do something about imports from low cost countries. When I raised the matter in this House and asked the Minister what action he had taken since then he endeavoured to put a different interpretation on his words. Whatever the actual words used and whatever the literal interpretation of these words might be, the fact is that he gave an impression which was universally understood by both sides to mean that he proposed to take action in relation to low cost footwear and to take it soon. Nothing has happened since. I hope the Minister will let us know what action he proposes to take. I hope his decision will not come too late.
The danger which arises at this late stage is whether, if a Minister makes a decision with regard to the import of low cost shoes, the industry generally, and the individual factories concerned, will be able to gear themselves to meet the increased demand. I have been informed that certain orders are not being placed with home manufacturers pending a decision by the Minister. If the Minister's decision is delayed to a point where it is too late to enable the factories to cope then the fault will lie with the Minister although this will be of little consolation for the workers who will continue to swell the ranks of the unemployed.
The real urgency can be seen from the fact that in 1973 the home production was 7.6 million pairs of which 3.1 million pairs were exported. In addition, 4.2 million pairs were imported. The total market consumption was 8.7 million pairs. The fact that 4.2 million pairs were imported in 1973 gives imports 48 per cent of the home market. In 1974 the import figure is approximately 5.5 million pairs. If the size of the home market remains constant and exports maintain their stability, then the share of the home market taken by imports rises from 48 per cent in 1973 to approximately 64 per cent in 1974.
The first demand of the manufacturers and of the union is that all exports from outside the EEC be stopped. In the light of all the circumstances it is not a request that the Minister can lightly brush aside. Undoubtedly, it will present some difficulty for him but it is his task to overcome these difficulties. When I raised the matter of low-cost countries the Minister replied that he was aware that some low-cost countries were producing footwear and added that there was a tariff on such imports. Nobody knows better than the Minister the total inadequacy of tariffs in this situation. If a pair of shoes can be produced in Hong Kong or Korea at 50p per pair because of low wages and poor working conditions and if a tariff of 100 per cent is placed on them, it simply raised the price of the shoes to £1, A tariff of 100 per cent would be regarded as a high tariff but in these circumstances it does not make the slightest change in the competitiveness of the imports vis-ávis the home-produced shoe. It has no effect at all.
I suggested in this House that the dutiable quota system, based on, for example, the year 1972, was the only system which could be effective because it gives to the Minister the power to control the volume of imports. I would remind the Minister that some years ago due to an international agreement when Ireland was obliged to change from the quota restriction to tariff protection, the Fianna Fáil Government negotiated on the matter and continued to provide quota protection for footwear for a further two years until the difficulties which faced the industry had abated. There is no reason why the Minister cannot follow this example in this serious situation.
The Minister could point out to those concerned that a vital sector of our economy is in jeopardy and that we must, if only for a time, apply the dutiable quota system of protection to avoid a complete breakdown. This would enable the Minister to control matters in a vital area while not doing anything to injure Ireland's export prospects or our credibility in the market place. Imports from low-cost countries, whether they are from Eastern European countries who do not buy even one pair of Irish shoes or from the Far East, are a serious threat to home-produced goods. No effort must be spared to remove that threat while taking cognisance of the whole economic picture.
I can understand the Minister's fears in relation to exports but I remind him that we must have a firm home base if we are to sell our production on the foreign market. The footwear industry must be assured that if they are to put the necessary effort and money into development that they have a Government, and a Minister, who are prepared to make a realistic effort to help them achieve their aims. Rationalisation is difficult to achieve in view of the size of our home market. We can only hope to achieve this rationalisation if we can sell our products on foreign markets. To do this the footwear industry needs a breathing space because with the reduction of tariff walls abroad the time has come to utilise these benefits. However, the import pattern has developed far too quickly. Time is needed and the home market must be protected to the extent that it will provide a worthwhile base for future exports by our industry.
I have a number of questions down to the Minister as to whether he referred any aspect of the importation of footwear to An Bord Dumpála. There are many reports of shoes being imported at prices and in quantities which must give rise to suspicion that these goods are being dumped here. They do not necessarily come directly from countries outside the EEC, although in some instances they do. In some instances it is known that they enter this country through the United Kingdom. I should like to know if the Minister has heard of this and if he has carried out any investigation. I am aware of the fact that in 1973 An Bord Dumpála investigated complaints of dumping from Czechoslovakia in relation to men's working boots and that some action was taken. However, a complaint was made to me that the process took a long time. I have been informed that it took the board a considerable time to reach their conclusions and make a decision. In normal circumstances we could overlook the length of time taken because the effect of dumping in such circumstances, provided it was ultimately stopped, might not have grave consequences but we are now receiving reports of further redundancies and short-time working being introduced and because of this any delay can be of catastrophic proportions.
Those people laid off initially because of dumping activities are unlikely to regain their employment. Therefore, the length of time taken to investigate dumping is of vital significance. If An Bord Dumpála are reasonably sure that dumping is taking place, I would ask the Minister whether they have power to restrict or stop imports while the investigation is taking place. If they have not got such power, would the Minister be willing to make it available to them? I am aware that An Bord Dumpála could not of its own accord initiate an investigation even where it had received information from the Revenue Commissioners that there was a likelihood that dumping is taking place. Therefore, I would suggest that if An Bord Dumpála comes into possession of such information it should immediately inform the Minister so that in turn he could request them to initiate an investigation. An Bord Dumpála have the statutory right to seek information in regard to dumping from the Revenue Commissioners. I would be interested to know in prevailing circumstances when the footwear industry is being beleaguered by imports from many and varied countries, if An Bord Dumpála have made inquiries as to whether the Commissioners are suspicious of any of those imports; in other words, that An Bord Dumpála would take the initiative themselves.
Since our entry into the EEC the problems of the footwear industry increased as we knew they would to some extent. However, conditions generally at present have enlarged those problems beyond what was anticipated. Therefore, we have to take another look at the import situation from the EEC. The figures I have are that 83 per cent of our imports come from the United Kingdom; 12.5 per cent from other EEC countries and 4.5 per cent from countries outside the EEC. The Anglo-Irish Free Trade Area Agreement and the EEC regulations control the import situation to quite an extent. In regard to the Anglo-Irish Free Trade Area Agreement, I feel the Minister should consider exercising the provision in Article 19 to meet this difficult situation because of the appreciable rise in unemployment in the footwear industry. He could also consider sections 68 and 69 in the book in relation to the accession of Ireland to the European Economic Community relating to the transitional period, and serious persistent difficulties in that section of our industry.
Apart from all of this, of course, the fact is that there is not one country of the EEC, apart from our own which has not, at one time or another, broken the rules when continuation of acceptance of them meant a serious problem for the country concerned. Normally, I would not advocate the breaking of rules in any context, international or otherwise. I fully appreciate that it would be much more advantageous for this country if all of the countries involved adhered to the rules and changed them by unanimous consent only. But in the present circumstances relating to our footwear industry and taking into consideration the fact that other countries of the EEC have broken the rules—some of them in relation to footwear; I am thinking here of Italy —when their vital interests were under severe strain, then I feel we have an equal right. Provided that discussion, consultation and negotiation between the Minister and those other countries first take place and then should they be a failure, I would feel he has got to take another look at that aspect of it. In those circumstances I do not feel the footwear industry is asking too much when it requests the Minister to restrict imports from EEC countries to an amount equal to the exports from Ireland in the preceding year. I think it was suggested that the figure to be taken would be the import figure for the year 1973 of 3.1 million pairs.
I would assume that the Minister has been having discussions with the UK and with the other EEC countries in respect of their levels of exports to Ireland at this critical time. I noticed recently a report that the countries of the Community were to have discussions relating to the footwear industry in the EEC vis-á-vis imports from countries outside the EEC. I would suggest to the Minister that side by side with those discussions he should discuss the problems of exports from the UK and other countries in the EEC to this country; firstly, exports which are home-produced within the EEC countries and, secondly, exports to this country from EEC countries which are first imported into the EEC countries and then exported here.
When talking about breaking agreements, we might very well remember that, even though the Anglo-Irish free trade area agreement did not under its terms permit an import deposit scheme, the British Government had no hesitation, on two occasions—if my memory serves me right —in imposing import restrictions on exports from this country to the United Kingdom despite our protests.
I should like now to ask the Minister what he proposes doing to encourage Irish people to buy Irish footwear, or at least to give first preference to Irish footwear. This is the other side of our defence of employment in the footwear industry. In addressing myself to that point I have already been considering the means by which we could reduce the pressures of foreign made footwear on the home market. I should like briefly to discuss the prospect of improving the sales of Irish footwear on the home market because that aspect of the matter would help considerably in improving the situation in the industry here. There are about 8.7 million pairs sold on the home market and, as I have already said, in 1973 4.2 million pairs were imported. In 1974 it is estimated that the import figure will be approximately 5.6 million pairs. That figure of over 5 million pairs is itself not much below the total Irish production of footwear for 1974. Obviously, if home production were to regain a reasonable proportion of the market, now taken over by imports, that would give a considerable boost to the industry and very particularly to the morale of those involved in it. How to achieve that is the main question. I feel it is not sufficient for the Minister simply to make speeches requesting the people to buy Irish— and pointing out the consequences of not doing so. First of all, he has to be seen to be serious in this matter by taking decisions necessary to protect the industry from without, decisions which, as I said before, nobody pretends are easy but which must be taken if we are not only to halt the unfortunate decline all too apparent but also to develop the industry.
I have little faith in purely holding operations. To succeed I believe it essential that the industry be geared to expansion. The "Buy Irish" slogan has been used so often and to so little effect, relatively speaking, in the long term that cynics might tend to scoff at it. Nevertheless, we must re-think the whole matter because despite all the problems involved, despite the relative lack of success in the past, the fundamental idea of focusing the people's attention on giving first preference to Irish goods in a small country such as ours, is a very sound one. We must bring fresh minds to bear on the development of the idea, to produce new ideas, new methods of presentation which are in keeping with modern trends and which can make an impact on the buying public. Success in this matter means winning back a portion of that part of the Irish market now controlled by imports of foreign footwear. In my belief this in turn will establish what I feel to be a matter of vital importance—a firm base so essential to the development of our exports. I feel the professional touch is necessary here. We could well be on our way to success in this matter were we to succeed in involving those in the retail trade to a greater extent, by persuading them by convincing arguments that it is in their own best interest as well as that of the nation as a whole to sell Irish footwear.
Looking at the matter objectively, I think it is asking too much of the hard-pressed housewife to concentrate on buying Irish goods at all times, if she is left without any guidance on this matter when she goes out to shop. It would of course be nice if she would do so and no doubt there are some people in this so-called affluent society who could without placing any great strain on themselves do this, but we know from experience that it is asking possibly too much of human nature and therefore our best hope lies in convincing the retailer that he has a special part to play in the presentation and display of Irish goods. Quality and price of course play a particular part.
Let me say to their credit that the majority of our shopkeepers do their best and this goes also for some of the large stores but we know only too well that the big profit margin is the sole objective of some. These people are not short of excuses when challenged but there is no hiding the basic reason. I therefore suggest to the Minister that he should concern himself at once with a very thorough investigation of the profit margin on footwear, particularly footwear coming in from low-cost countries. I can remember a case some years ago of a large newly-opened footwear shop in Dublin which had its window full of foreign-made shoes and only a few pairs of Irish shoes. A friend of mine employed in the management side of a boot factory in my constituency saw this and at a seminar of leather workers later asked the employees of the shop who were at the seminar why they pushed the sale of these foreign shoes, to be told that they got a bonus from their employers for so doing. To put it mildly, the shortsightedness of these employers' policy appals me. Do such people not realise that to continue in this vein could cause the collapse of the shoe industry and that the workers who are their customers would no longer be able to buy from them?
From the figures available, it would appear that the supermarkets are the worst offenders, buying 2.4 million pairs from abroad out of a total of 5.6 million pairs imported and getting a large proportion of these by bulk buying, I understand, of low-cost footwear. I do not wish—again it would be unfair of me if I were to do so— to put all the supermarkets in the same category. Some do their best, but it is heartbreaking to go into many of them in the city and see the enormous consignments of foreign-made shoes on offer. How can we expect the ordinary housewife, with very limited time at her disposal, to go poking around a store packed with foreign goods in order to buy an Irish product? How can we expect young people, who are now an important factor in the business world because of their purchasing power, to concern themselves to buy Irish products when they find themselves in some large stores surrounded by imported goods? On second thoughts, perhaps it is at the level of our younger people that we should now direct our attention. We need to get across to our young people that to buy Irish is not only the essence of patriotism but the surest path to a worthwhile future for themselves. We might take example from the commercial advertisers who undoubtedly get their case across to the youth, not in the old arid way which means little in modern society but in a way which will get a positive reaction. I commend to the Minister that he take particular note of that point.
To sum up, home production from 1972 has dropped from 7.6 million pairs to 7 million pairs in 1974. Imports have increased from 3.3 million pairs in 1972 to 5.6 million pairs in 1974. This is an almost unbelievable increase. Imports from the United Kingdom during that period increased from 2,720,000 pairs to five million pairs approximately, an increase which I feel would give rise to some suspicion of dumping which I think should be investigated. During the same period, imports from the EEC increased from 600,000 pairs to 700,000 pairs and from countries outside the EEC, from 100,000 to 280,000 pairs. In relation to this last situation, that is, the imports from the low-cost countries outside the EEC, the increase is also exceptional and even more important, it appears to be a pointer to the problems which can develop in this area when the footwear industry in the countries concerned becomes fully developed.
We have dropped our share of the home market from 52 per cent in 1973 to 40 per cent, or even lower, in 1974. It was recognised that in the context of the Common Market, we would lose out to some extent on the home market, but the lowest figure thought possible at that time was about 50 per cent. Our latest figure indicates the dangerous plight the industry finds itself in and the Minister will agree that the industry will find it very difficult to develop what we need most, a worthwhile export business in footwear, if the home market continues to deteriorate at the rapid rate it has done in quite recent times. This highly intensive labour content industry must get a breathing space for quite a considerable period to get used to a higher rate of imports. There is an urgent and grave need for rationalisation to meet the changes from the quota system in the sixties to the expiration of the duties in the seventies. Firms are faced with more redundancy this year and two are faced with imminent closure.
From the figures I have given it will be seen that imports from the United Kingdom are quite a considerable problem and I would feel that from a danger point of view imports from countries outside the EEC constitute a very real danger. If one takes cognisance of our relatively tiny population, it can be clearly seen that it takes a very small increase in imports to have catastrophic effects on the industry here. From any research I have done into the matter I am convinced that given the time and given the assistance, both in finance and control of imports to which the industry is entitled from the State, we have the ability to rationalise production. Our boot and shoe operatives are highly skilled and if proof were needed of this, one has only to note the interest of manufacturers of footwear in other European countries in our labour force.
Let the Minister make his decision at once so that orderly development can proceed, something which will be entirely frustrated if redundancy and short-time working continue, resulting in the scattering of our work force. In making his decision, it is vital that the take particular cognisance of the proposals put before him by the Irish Shoe and Leather Workers' Union and by management. I am convinced that this industry which is vital to the economy for the employment it gives and its contribution to our balance of payments, can be restored and developed and our boot and shoe operatives employment secured.
Finally I would refer again to the continued and rapid loss which is being experienced by the industry in their share of the home market. In 1971 the Irish share of the home market was 65 per cent, in 1972, 56 per cent, in 1973, 52 per cent and in 1974, 40 per cent. The Minister will agree that this is an extremely rapid decline in the proportion of the home market. It is something that will have an extremely severe effect on the industry in general because, as I pointed out before, if we are to develop the shoe industry it will be necessary to develop exports but it will not be possible for us to expand without having that share of the home market that is essential as a firm base to exports.
I appeal to the Minister to make a decision at once. There is nothing worse for any industry than uncertainty.
