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Dáil Éireann debate -
Wednesday, 2 Jun 1976

Vol. 291 No. 5

Private Members' Business. - Nítrigin Éireann Contract: Motion (Resumed).

The following motion was moved by Deputy O'Malley on 1st June, 1976:
"That Dáil Éireann, in the light of similar decisions in the past year by other semi-State bodies, notes with deep concern the recent decision by Nítrigin Éireann Teoranta, with the apparent approval of the Government, to allow a major contract to go outside this country when the work could have been carried out by Irish firms with consequential benefit to the Irish economy."
Debate resumed on the following amendment:
To delete all words after "Dáil Éireann" and substitute the following:
"notes and approves the efforts of Nítrigin Éireann Teoranta to ensure that the plant for the production of ammonia and urea being established at Cork will be constructed to the highest standards of safety and efficiency so as to safeguard the State's investment in it, the employment in that plant and in the fertiliser industry in Ireland, and the security of supply of such a vital material for the farming community."
—(Parliamentary Secretary to the Minister for Industry and Commerce).

In the course of his speech defending the action of NET in allowing this contract to go to Kellog without competitive tender, the Parliamentary Secretary to the Minister for Industry and Commerce stated that Kellog would not receive any extra profit—if he was here he might confirm that I am not misquoting him —for doing this work on a direct labour basis because, to use his words "there was a fixed fee for services agreed". Surely the Parliamentary Secretary must realise that the fixed fee agreed was not for the erection of the plant but rather for the consultancy services that went into its design. Kellog have not decided to undertake this very important and valuable contract by direct labour solely for the good of the Irish nation or because they like the Cork air. They are doing it for profit, because they know that if they do this work in that manner there will be more money for them out of the contract that they have been allowed, one might almost say steal. They are interested only in how much they can make out of the work they will do.

The Parliamentary Secretary also answered that the Minister was involved only after the original contract was awarded. He said—again I hope I am not misquoting him—that the Minister was asked only to reverse a decision already taken. There seems to be some confusion about this in that the Minister, in answer to Deputy O'Malley in the House, stated categorically—and Deputy O'Malley gave the reference—that he had full responsibility. The Parliamentary Secretary said also that any Government should not interfere in the day to day running of a semi-State or State-sponsored body. I and every other Member of this House would agree with that. Surely the construction of what the Parliamentary Secretary himself described as the second biggest plant of its type in the world could not be said to be an everyday affair of this semi-State body?

A decision such as this, with its major political implications, should have been a matter for the Minister. If the Minister was not consulted, I feel—and so must everybody else in the House—he should have been; he should have had the final say as to who would obtain the contract. That was a decision not only of vital importance to NET but to the country as a whole and to the advancement of technology here. Positive, definite action will have to be taken to ensure that something like this will never be allowed to happen again.

I am sorry to interrupt the Deputy but he might now make his concluding remarks.

The very basis of competitive tendering was upset in this case. Even at this late stage—I know it is late because I am aware that recruiting has commenced—the Minister should ask NET to reconsider their decision, that Irish sub-contractors be given a chance to prove that their skills, expertise, workers and standards are as good as any in the world.

This decision—and a wonderful one it was—by the Government to build this nitrogen plant in my part of the world was a very welcome one at the time. I must compliment the Minister on his wisdom in using practically half of our natural gas resources to date in investment in farming because that is what this project is all about—investment in farming, when, for the first time in history, we have real control over our inputs. In recent years we have seen what an international situation can do to upset the whole farming industry. That is why I welcome the decision of the Government to invest so much money and indeed half our natural gas in the creation of a very valuable fertiliser industry.

This effort by the Opposition is really a vote of no confidence in the board of NET because, like a lot of other State bodies, they have to act in a commercial manner, take commercial decisions and ultimately be responsible. If we are to succeed we must put our trust in their decisions. They took what I regard as the best commercial decision. The mechanical construction of the plant is the most important part of the project. So far in Ireland we have never attempted the construction of any such plant. It is of gigantic size and complexity, capable of turning out something over 2,000 tons of nitrogenous fertilisers per day. The view was taken by NET that, while it would be possible for a group of companies here to construct this plant, it would be better if Kellog did the job themselves. NET believed that in sub-contracting to smaller contractors control would be dissipated and the main contracting control weakened.

It is important also to have the job completed on time. Here I would go along with Deputy O'Malley's point of a penalty clause, if necessary, because time is of the essence—get the job done quickly, get people employed and have the product available. We have been assured that the same number of Irish men will be employed and that all available Irish equipment will be used. Indeed, it was a free decision of NET to utilise the direct hire system.

This construction is the most important part of the project. As Kellogs have done this work previously by now they must have perfected their technique. We all know the first time we do anything, whether it is a farming operation or anything else, we make certain mistakes but by degrees we learn to perfect that job. I believe Kellogs are now the experts at building this type of plant. They designed it and they have the advantage of experience and direct supervision. It is vitally important that such an important project costing so much money be built by the people who designed it.

With regard to employment, as the Parliamentary Secretary pointed out, there will be 584 Irish workers on this job. As one who realises the unemployment problems in the area the sooner those people are employed the better. My advice to the Minister and to NET is that they get on with the job. From the information given last night by the Parliamentary Secretary I am assured that NET are carrying out this work most efficiently and as economically as possible. It is vitally important that this plant gets into production. It is also important that it be built by Irish labour. The cost factor of sub-contractors is also important leading to a more expensive product for the farmers and NET.

We must bear in mind that we will have to compete with foreign fertilisers on the home and export markets. Due to the magnitude of this project and bearing in mind possible development in compound fertilisers this industry must, of necessity, export. This is the key to the whole thing. It has to be built efficiently and as cheaply as possible if we are to compete. We are in an EEC situation where we will have severe competition from competitors on the European mainland and from practically all over the world so we must have a competitive product.

I am quite sure that NET know what they are doing because they will have to run that factory and will have to make it pay. We must have confidence in them when we have appointed them to do the job. I am assured by the Minister that the work so far is on target. Due to the fact that Kellogs are constructing the plant themselves it will be completed in the minimum time. This will ensure that we will be in production in the shortest possible time giving jobs in the manufacture of fertilisers, haulage and distribution.

This is a very exciting project for the nation and also for the harbour area. We will not only have the manufacture of nitrogenous fertilisers but I am told that this will develop into compounding of fertilisers and into bulk handling, which is something I have been interested in for a long time. I believe when the board of NET get going they will set up a project whereby fertilisers will be handled in bulk for distribution around the country and for export as well. I place full trust in the board, the Government and the Minister because I know that he has handled all his industrial projects with care and efficiency. I have full confidence that with his close liaison with that board we are on the right road and that we will be employing Irish people.

The important thing is to get the plant built and get it going because this is where the permanent employment comes into it. Builders and technical people run around from one job to another. I would like to see the plant in action with a full complement of Irish people working it and a further expansion and diversification into other aspects of the fertiliser business. I would like to compliment a great decision of a great Government in devoting half of our natural gas to the fertiliser industry and to the benefit of our farmers. Fertilisers have been described as the life blood of farming. Therefore, we are pouring life blood into that industry.

There is nobody on any side of the House who doubts that this industry is necessary and advantageous. We wish it well for the future and compliment all those who had anything to do with setting it up. However, I do not think that is the point we are debating in the motion before us. I, like other Deputies, have received many representations, both verbal and written, regarding this decision in relation to the disquiet it has caused in certain sections of the community. As the previous speaker has said, the disquiet is not in all sections of the community but it is certainly in many sections.

I want to reiterate what was said last night. I do not believe anybody on this side of the House would advocate that people who either priced themselves out of it or were unable to do it should get the contract from the board of NET. We are talking about a matter of principle where people were ignored and Irish firms were not given the chance to tender. That has caused a good deal of disappointment. There has been resentment in some cases and anger in others. It is understandable if you take the viewpoint of the person engaged in that type of work. We all feel in our own spheres that we are able to do the job we are engaged in as good as the next. Certainly we would not like to be passed over completely in relation to something which should be for open competition, especially when it happens to be the biggest project that ever came to the country and that we were so small and so insignificant that we were not consulted in the matter. That is the difference between us.

There are many excuses made why this did not happen. There does not seem to be much reason behind these excuses to the men involved in this. It is bad enough to lose a chance of creating employment at a time when we never needed it so badly but I feel something worse is happening. We are eroding the confidence of our young people in the future of the country. In years gone by the bias was towards academic education because we were a rural population, an agricultural population, and we had not much of a choice. An academic education was the kind of education which appealed to us most. At that time we exported our brains as well as our brawn. Perhaps we had no choice in the matter.

The advent of industrialisation, the coming of the oil refinery to Whitegate and Gulf Oil to Whiddy Island and various other major industrial projects have certainly changed the attitude and especially the educational bias towards technology. I know there is tremendous activity in the regional technical colleges and I know in Cork we have a very active Department dealing with these matters. Public representatives, local government officials, lecturers in the college and many industrialists went to foreign countries and learned what they could from what is happening there. When it comes to our turn in the not too distant future, I hope we will be able to face up to the challenge and learn from what happened in Aberdeen and other places.

We have to do all in our power to prepare our young people for the developments that will accrue from the coming of our offshore gas and oil. I am stressing this point because a great injury could be done if it were to appear that we were not able to tackle big jobs as well as small jobs in fields which were unknown to us until recently. It is not much of an excuse to say "You have never done it and therefore you are not able to do it". If that were so, none of us would get very far in any new walk of life.

It will be difficult to explain to students of technical colleges and their lecturers why we are not giving them the same opportunities as people living abroad. Due to long experience the person coming from abroad may be better equipped to do a specific job, but that is not a reason for not inviting a home-based industry to tender. If home-based industries were invited to tender they would feel they were getting some recognition. If they did not make the grade the first time, by the time a decision had been made they would have learned something that would equip them for the future. As I said earlier, we are living in a free-for-all European Community in which our industrialists will be able to compete with confidence to gain contracts from other countries. But to do that they must feel they are worthy of consideration in their own country.

The Minister is the one man who should be fostering and encouraging an interest in technology for the future of the industrial welfare of the country. In my opinion his attitude to this matter has gone a long way toward undermining the confidence he should be trying to build up. He made the point that he does not interfere in board decisions. I accept that—the Minister is a good man to make his point. But he should have made it his business to be aware of what was happening. He should have ensured that he was consulted and his opinion taken. He should have had the welfare of the workers at heart and seen the problems that might interfere with the future development of the education of our young people in this technological age.

In this case the decision reached can be interpreted by all those engaged in the industry as a vote of no confidence. I can think of nothing more detrimental to the future of the country. I cannot understand why a Minister cannot explain beforehand the reason Irish firms are not asked to tender for a certain job. How could it be unethical to do such a thing? There must be some kid-glove method to explain why they were not asked to tender for the work. An explanation given later does not have the same effect. It is a matter of public relations. If you have to have public relations between employer and employee, you should also have the closest harmonious relationships between Departments, Ministers and the industry. If we had had that relationship, we would not have had the resentment and frustration which occurred much too often recently.

Last night we listened to the Parliamentary Secretary, who appeared to be very gratified that Irishmen would be employed in the direct labour operations conducted by Messrs. Kellog. That is a wrong premise because the slant is that the Irish workers are good enough as hewers of wood and drawers of water, but when it comes to a skilled job they have to look somewhere else. We should all try to get away from that kind of interpretation. The day is long past when the unskilled, semi-educated Irishman had to go abroad to take his chance with the lowest paid workers of the world.

In this new era we should ensure that, if an Irishman is properly equipped, he can take his place with the best workers of any nation. There should be some way of fitting him for such positions at home. I can imagine no better citation for a firm in Ireland than to say they were in some way associated with the building of this large enterprise. That is if they were capable of doing it. I always qualify that because I am not asking that anything should be given to a person or a firm who is unable to do it. If a person is able to do it, it should be a tremendous boost not alone to him but it will be an example to the whole country as to what can happen if a person is enterprising enough and has enough initiative to go out and learn how to do things as they should be done.

I hope the Minister will be able to explain not only why no Irish firms were asked to tender but why they were kept in ignorance of that fact until such time as the decision had been made. We are living in very uncertain times at present. Everybody knows that there is a great sense of insecurity. No one is sure of his job as he could have been years ago. No young person is sure of what his future holds. There is an air of uneasiness and therefore opportunities like this, which would mean a great deal of employment and the spending of a great deal of public money, require kid-glove handling. Public relations must be of a priority where you are concerned that there should not be misunderstanding and that injury should not be done where it is not wanted to be done. The Minister, the board of NET and everyone involved, should take the people into their confidence and explain why it is felt that certain decisions must be made, especially when these decisions might mean the creation of employment for several hundred people.

A few years ago we were told that we would have open Government. In my opinion that means that the Minister would consult with his Department or with the semi-State board and with the employers and workers representatives and maintain perfect liaison at all times. It seems that the very opposite is the case. Not only are decisions arrived at without consultation but people are being made to feel that they have no right to protest and no entitlement to an explanation. The Minister was unwise in making a public statement that Irish firms were capable of building houses but not of constructing complex plant. That statement is another outstanding example of how this affair was handled. It has caused considerable irritation among workers that such a statement should be made especially, as was stated last night, as several major projects have been successfully handled in this country and abroad by Irish firms. Taking it all in all, the atmosphere that we now find building up about decisions of this nature indicates a very bad public relations job. If the decision was necessary it should have been explained beforehand. The Minister's attitude since then has not helped. It is very necessary at present to do everything possible to create employment. It is up to the Minister to use whatever pressure possible to ensure that whoever gets contracts or work, employs as many Irish people as possible and that every job that can be done by an Irishman is so done.

I received a petition from Cork some months ago because some oil riggers, or some people of that kind, were worried because they were being moved out by the new people coming in. There was great uneasiness and concern about it. They took certain strong action and the matter seems to be resolved now. But that was a very minor thing compared to this huge complex and what it entails. If things were stated by the Minister, and there was no one in Ireland in his opinion with enough experience to do the job properly I feel they might still have been invited to quote. When people are recognised as being involved in a certain industry they should be invited to quote, even if the Minister knows or the board who asks them realises that they will probably be beaten by a more reputable and experienced firm. This is quite understandable. But it is the fact that they are in their own country and that a board set up with millions of pounds of the people's money should not consider them and let them see that they are considered is wrong.

The amendment put down by the Minister is another indication of no confidence. It is badly worded. If the Minister wants to oppose this motion it could have been done without wording the amendment as it is. It is worded to seem that the highest standards of safety and efficiency would not be safeguarded by the State if the work had been given to an Irish firm. I am not saying that was what was meant. I am saying that is the way it can be read. This decision, following the decision about the building of ships and the making of furniture abroad, has caused, and is causing grave concern throughout the country. For that if for no other reason I feel that every Minister and every Deputy could support the motion without any reflection on anybody. The motion only indicates that all Deputies regard the decision with deep concern. It is an appeal to see that what has happened will not happen again and that at least the Minister, if not directly responsible, will ensure that he will be consulted and that the Minister will do all he can to see that Irish firms are aware of the position they hold and is aware, if they are not tendering, why they are not tendering and in that way avoid confusion. I appeal to Deputies on all sides to support the motion. I think it would do nothing but good and the Minister would come out of it stronger eventually if he adopted that course.

I hope Deputy Healy, if he does not stay to hear everything I say, will at least read the whole of my speech afterwards. I found him in my years in the Dáil someone who is always concerned with the decencies of public life, with accuracy and with fairness, and I believe that the answers I have to give will convince anyone who is fair that the accusations made against me and also, much more importantly, against NET, are unfair and are, in fact, pandering to chauvinist instincts, which are easy to arouse but which are also harmful to arouse. I do not for a moment try to pass away responsibility for this decision, not because I am involved continuously in the decisions of the semi-State companies responsible to me—of course I am not; of course they must have freedom to get on from day-to-day with decisions big and small—but in the sense that if they make a mistake, I have the power to call them in; of course, if the worst comes to the worst, I have the power to dismiss a board and to reverse a decision.

This is something that arose not in the first week of May. This controversy has been going on now for more than a year; it is not new and I am very familiar with it. In that sense the Minister responsible for any State company working to him, in the end, carries responsibility for those decisions, even if he was not consulted beforehand and even if it is not desirable in the normal day-to-day functioning that he should be, because obviously you cannot have every decision going over a Minister's desk.

It is suggested that the action of NET is costing unemployment, is costing jobs in Ireland, that it is eroding confidence in Ireland and in the terms of Deputy O'Malley's motion he said his way would benefit the Irish economy and so the inference is that this way is damaging the Irish economy. I must rebut all of those charges and, I hope, when people have heard me finish, that those who are fair-minded will believe convincingly.

We are concerned with an area of demarcation, because at the two poles there can be no disagreement. Everyone agrees, I take it, that as much as possible of any construction task or of any other task should be done in Ireland. Then we get into the area of definition: how do you define "as much as possible", and I will come to that. Everyone who lives a practical life from day-to-day in Ireland knows that there are areas at the other end of the spectrum where you cannot have everything Irish, and nobody—Government, Opposition, man in the street—claims for a moment that you can.

We do not insist that Departments of State have what I might call Irish motorcars; there are some assembled in Ireland, some not, but there are no motorcar companies owned in Ireland, only motorcars owned by American firms, British firms, Italian firms, German firms and so on. Nobody claims that Aer Lingus should fly Irish-made aircraft because there are none. We are very proud of Aer Lingus, but we are realistic enough not to make that claim. Nobody claims that RTE which, I take it, again many of us are proud of, should use Irish equipment on the floors of studios, because we recognise it does not exist. There are many areas where the claim is never raised because it is known to be unreal.

There are other areas where you get into a grey section of decision, where decisions are not easy. I do not claim, for example, to know all the reasons and I do not, therefore, offer judgement on the action I am about to mention, but I would give it as an example of a grey area, not judging it but mentioning it just to show that sometimes decisions may be difficult. I understand that all of the colour work of The Irish Press group of companies is done in England. There may be very good reasons for that, and I am not offering a value judgement on it. I am saying that there is a company, associated very intimately both in its foundation and in its present management with the Opposition, where this happens.

Therefore, there can be decisions of all kinds, and we have the two poles. What we have to do is to try to define accurately where the balance of benefit to Ireland as a whole lies. If that can be defined, then it is not just something that politicans and Ministers may do, but something they must do, to take a decision that may be unpopular with a section of the people, as this one is, as I am perfectly well aware, for what I am satisfied is the greater good, much the greater good, as I hope I can indicate. As I say, we are in this area of demarcation.

Deputy Healy says there is a shortage of information. I gave what I thought was a lengthy, helpful and non-contentious parliamentary answer to this recently, but it has not stopped the misunderstanding and so I want to put some facts on the record first, and some arguments after that.

First, on the matter of the scale, the cost of the project to NET in Cork is £74 million. That to me seems to be an immense affirmation of confidence in Irish industry, in Irish skills and jobs, and in investment in Ireland, and something that I am proud to have driven along with all the strength and all the wheeling-dealing capacity I had to get positive decisions. I think that is an affirmation of confidence in Ireland.

I said this is one of the biggest single ammonia urea plants in the world. It is also a case that we are racing against time. We know the time the gas will be coming ashore and we know the rate of plant construction. You cannot quantify it exactly, but to give people even an approximate figure, every month lost will cost the State, both through NET and in other ways, £1,500,000. If you look at that £1,500,000 in terms of industrial grants, jobs created and so on, you will see what that can mean to our economy. It is not a year lost, but a month lost. That is the order of magnitude.

Anything going wrong with this in regard to time of completion—I have quantified that very roughly—in regard to reliability of the work, in regard to the total cost, which means the efficiency of production, has a bearing on the jobs of the people at Marino Point in Cork; it has a bearing on the people in Arklow, because they will take ammonia from the Cork plant; it has a bearing on the viability of the whole project in conditions of free trade, and people who know a little about the fertiliser market will know what fertiliser free trade can be like. Therefore you have to guarantee the company the absolute maximum of efficiency and competitiveness, and the best way to build up the confidence which Deputy Healy talks about of Irish industrial enterprise—and what can be more Irish than NET—is to let them have success in profits and exports, to let them grow and have no failure, no difficulty and to achieve this huge contract under NET management as quickly as possible. That is the best thing for confidence.

It has been suggested over and over again by Deputies—and I beg them not to move on misbeliefs without investigating the facts—that no contracts were given to Irish firms. I must assure the House that that is not so.

We never said that.

Deputy Healy asked why Irish firms did not get a chance to tender. I am putting it on the record that for certain parts of this whole construction such as a jetty which is a fairly large individual construction or such as the site preparation, there was direct contracting by Irish firms.

Leaving aside those parts of the total construction which obviously are suitable for Irish firms, we come to the question of the major process plant, much the biggest part. In that case one must affirm that in respect of the manufacturing of that process plant there is no firm in Ireland that have ever done anything like that, that are fit to do it or would claim that they would manufacture such a plant. When NET investigated the situation, they found that there were only eight firms in the world considered suitable for the job but this figure was scaled down to three and from those three NET invited tenders. The NET team decided that by far the most efficient way of approaching the matter was to give to one of those firms the responsibility from beginning to end for design, engineering, procurement, construction and commission of the process plant, having first set aside the other parts for Irish tender. That was their technical judgment and the CIF did not claim at any stage that any of their members could do other than assemble the plant when it came on to site and participate in the commissioning of it. There was never any separate £10 million tender that was not offered. There was a total tender to Kellog for the whole effort because, for what seemed to me very good reasons, that was reckoned to be the most efficient way of getting the job done.

The good reasons relate not simply to cost but to the date of commissioning, reliability of commissioning, the tying down of the main contractor, so that they could not wriggle out in any way, and the certainty that they would have to complete their contract. Let us look at the possible management structure. There would have to be NET staff there anyway and a very expert and highly qualified Irish team they are. There must be the people from Kellog who are building the plant from equipment obtained from suppliers as far away as Japan. There must be Irish workers and these are not only labourers. They are people who are being given a whole series of very valuable skills which they will use in Ireland in further construction. If I have time, I shall itemise the skills of those workers, of whom there are about 600 involved. Therefore, with NET for the parent company, Kellog as the manufacturers and the direct employment of Irish workers there was a simple structure whereby targets could be met but what we are being asked to do is to introduce another layer into the management. We know that we must have the original manufacturer, that we must have NET and that we must have the Irish workers but we are being asked to introduce a number of other Irish firms as a layer between the workers and NET/ Kellog.

Let us talk about what are the options in terms of cost since it is suggested that we are damaging the economy. I am suggesting that the NET way is better for the economy and in this regard there are some figures I wish to put before the House. For the £10 million part in respect of which it is argued that an Irish firm might have been involved, the Kellog fixed fee would be the same anyway as would the hourly-paid labour which is totally Irish. The same applies to the NET staff salaries, a staff that is totally Irish. Kellog staff would be comprised of twice as many Irish as British so if I am generous and say that you reduce the British part of that to half what it is, there is a reduction from 4.2 per cent to 2.1 per cent of the total charge. In other words, if you sub-contract the British part and cut it in half there is a saving of 2.1 per cent of the whole cost. Temporary buildings, workshops, office furniture—totally Irish—amount to 17 per cent while the hire and purchase of cranes, specialised welding, pipe bending, lifting and other equipment represents 12 per cent Irish and 4 per cent British. There are items here which are referred to as gin poles. I have no idea what they are but it says they have a 600-ton lifting capacity and since they are not available in Ireland they must be hired in Britain. A lot of all this shows that 90 per cent of the job is Irish and 10 per cent British and if by sub-contracting there is a saving on the British side of 2 per cent we must ask what we add to this. Irish contractors charge 15 per cent and if the face value of the contract is £10 million, this 15 per cent would involve another £1,500,000. Also, Irish contractors would constitute another layer as there would be four or five of them on the site. They might complete the work as fast as it would be completed with a simple management structure but for every month that might be lost the cost would be approximately £1,500,000.

Such a structure might not have any troubles along the way in regard to an impeccable totally correct commission but should they have any trouble, other delays would follow. If the work were to be in the hands of a sub-contractor, the main contractor could raise arguments about date of finishing and about quality finishing. If we were to make the job more complex in these ways, we would be adding to the cost and this added cost would be passed to the Irish taxpayer, to the Irish farmer and on to the future profits of NET, a wholly Irish company. Regarding the extra number of Irish people that would be employed in such a set up, these would represent only a handful of the senior management of some Irish contracting firms. There would not be any more Irish workers on the ground. The number in this respect is 584. For Deputy Healy's information I shall give a breakdown of this figure. They comprise 95 welders, 225 fitters, seven carpenters, 75 riggers, 31 equipment operators, 16 transport drivers and 135 labourers.

Therefore, of these 584 personnel, 135 are unskilled. In fact, a training school has already been set up for these people and they will be released to the construction industry with the valuable skills learned on this job under the supervision of Kellog and NET. It is not a choice between more or less employment because the difference would be a handful of Irish engineers and managers. NET will employ a staff of 30 exclusively on this project, nearly all of them engineers. You are saying that, for the sake of a handful of management and supervisory staff in Irish contracting firms, you are going to put an Irish State company in a disadvantageous position which may threaten its profits and cost our farmers and the State large amounts of money. As I have said, we would not reduce the Kellog staff, we would not increase the number of Irish workers, but we would increase the total cost and run severe risks. Any increase in the total cost must fall on the people who pay— the taxpayers, NET profits and farmers buying fertilisers.

I want to put it in terms of a balance sheet, but before doing that, A Leas-Cheann Comhairle, I want to make an apology and this is the most formal place in which I can do it. I reacted in Cork to a document from the Construction Industry Federation. I had read it but I did not have it in front of me at the time. It refers to the "major mechanical contract", that is the phrase used in the second line of this statement of 5th May. I did not know of a separate contract for £10 million because there never was such a contract, but I did know of the major mechanical contract that went to Kellog. I believed that that reference by the Construction Industry Federation was to the total contract, including the manufacture of process plant, and I reacted to that with irritation, unfairly and unjustly. There is no firm in or out of the Construction Industry Federation that manufacturers process plant. I did utter a sneer, not at the capacities of the Construction Industry Federation, but counterposing it, when I said they were good at building houses, to their complete inability to produce process plant, which they would affirm. Many countries bigger than this one do not produce process plant. Nevertheless, I expressed myself unjustly and with irritation towards both the Construction Industry Federation and one individual in it. That sort of irritation is always a bad counsellor. I do not weaken the basic argument I am making in the least, but one of the newspapers pointed out, correctly, that I had confused the issue by my outburst. I think they were right. I very much regret it and apologise.

What I have said does not alter the basic argument. I have altered the terms of the technical assistance scheme because under the previous Government it was not possible for technical assistance moneys to be given to the construction industry for the bringing together of groups for greater planning efficiency and the taking on of larger jobs. They all know from, for example, my travels abroad and my talks with them that I am aware of and admire their capability and am happy to see it extended.

The Minister has five minutes left.

Thank you, a Leas-Cheann Comhairle. That does not alter the basic argument. The basic argument is as follows: that in the interests of the workers, because the jobs will be for Irish workers anyway but some of the owners and managers in those CIF firms are trying for perfectly clear reasons of their own personal advantage to insinuate themselves as another layer of management in the process plant section of the NET site in Cork. The decision of the NET board was not to allow them to do that but to give supervision in a direct recruiting mechanism in conjunction with NET to Kellog. Doing it the NET way is worse for the owners and managers of these firms. But all decisions are about making balance sheets. I am satisfied that the NET way of doing it is right in terms of total cost to the State, efficiency of completion, and the efficient tying down of NET on their contract so that they cannot plead any other reasons. I am satisfied from the point of view of NET, which is a State company, the jobs at Marino and Arklow, and the farmers and taxpayers. In that scale path you have to put taxpayers, farmers and Irish industry. In the other scale path against them you have to put a handful of the owners and managers of a few Irish construction firms. That handful would benefit at the expense of the sections of the community that I have mentioned.

Since I have to take a wider view and to uphold the general interests of taxpayers, farmers and State companies, I have no doubt that the balance of correctness lies in upholding the decision of the NET board to which I was not a party at the time, about which I became aware afterwards and for which I accept complete responsibility. There is, of course, that balance sheet. When you look at it this way you can only believe that in the interests of an efficient industry, and what is better for national confidence than an efficient industry completed on time, that in the interests of employment, and what is better for employment than secure industry making profits, that in the interests of Irish industrial expertise, and what is better for expertise than an Irish firm as a magnificent success using half our natural gas to make fertiliser for us, the interests of the wider section are in conflict with the interests of the ownership and top management of a small number of the construction industry.

There is that conflict, but when I am faced with that conflict, when I am faced with choice, I have to choose the wider interests—I have to choose Irish jobs, Irish efficiency, the well being of an Irish State company, not for now but down the decades. I have to choose that as against the sectional interests of a very small number of people. Those who try to distort this into lack of confidence in Ireland are playing on chauvinist passions which are neither good for the future of Irish industry nor for sanity and calmness in Irish public life, or for the best decisions in Irish public life. I beg them earnestly, the ones who are open to conviction, on rational grounds to consider what I have said and not to make this, for party political purposes, into a sort of issue where there are no winners and where everybody belabours everybody else, and the atmosphere of calm and reason and best decisions gets blown away in a welter of what I have called chauvinist passions.

I was amazed listening to the statements of the Minister and his reasons for granting this contract. I was particularly startled to hear him say there are only eight firms in the world capable of doing this job and that three of them are on this side of the world. I assume those three are on the Western side.

All eight of them.

It is a well-established practice in an industry of this kind that such firms farm the jobs around among each other—they take the jobs in turn, they quote against each other. This decision does not redound to the credit of our own people. If we had given the job here, the fact that we keep every pound at home begets more and more pounds. This is done by every country in the world. We had experience several years ago when our exports of Donegal tweed were hitting at somebody else's industry, despite the fact that the price of our produce was much lower than theirs, they kept it out. The French have done the same to our sheep. Every country does this kind of thing.

To stand up here and make the case that because it was cheaper this contract was given to a foreign firm does not redound to the credit of the Minister who made it. We know that any Irish firm tendering for any job, particularly one involving imported steel, will have to quote much higher prices because any Irish firm that wants to buy British steel today will have to pay a far higher price than a British firm. It is obligatory on us to keep any work of this kind at home, even if the cost is much higher. We have expertise which is known throughout the world, and if we do not back up our own people we are denigrating their productive efforts and in effect we are asking them to go out into foreign fields to try to get jobs. If we do not give them jobs at home how are they to be given the confidence to go out and say in other countries: "We got this type of job in our own country against all others from outside"?

That is why I regard this policy as being all wrong, of a Government here handing a job to a foreign firm just because it will cost a few pence less. I do not care if it costs a few million pounds less, we have an obligation to back our own techniques and our own labour. It is extraordinary to listen to a Minister tied to Labour making these startling statements.

Would the Deputy like to answer some of the points?

If I had time I would. I am making a case here on behalf of the expertise and ability of Irish industry.

We have had an interesting debate on this topic, not the least interesting aspect of which was the speech of the Minister which was in marked contrast in tone and temperament to certain of his earlier contributions on this point. He was gracious enough to apologise in a fulsome way to the wide spectrum of people whom he gratuitously insulted in Cork on 10th May last. For that reason I do not want to labour that aspect of the matter, which to my mind was one of the most serious and objectionable of the various serious and objectionable aspects of this whole affair. Now that he has, after an interval of nearly four weeks, apologised, it is best to leave that side of it alone. I will just say that it is a pity it needed this motion to provoke his apology, that such a long period was allowed to elapse between the making of those unfortunate intemperate remarks and the equally fulsome apology for them which we have had tonight. If the motion achieves nothing else, at least it has achieved that. That in itself is something worth achieving.

Apart from his apology to the people whom he insulted in Cork, the Minister went to great pains to try to calm the matter and to play it all down, to try to give the appearance that there was a lot of fuss being made about something that was less important than the amount of talk about it would seem to indicate, that there was a very reasonable explanation for everything. We have had a number of explanations for certain of the things that were done or were not done. By virtue of the very short time available to me to reply to them, I will have to summarise much of what the Minister said. If I summarise them unfairly or inaccurately, I am sure he will correct me.

Not necessarily.

I cannot help that. One of the main points he made and which ran right through his speech was that it was more complex and more costly to have subcontractors involved in this matter, and he endeavoured to prove, apparently to his own satisfaction but not to mine or anybody else's, that it was cheaper not to put the mechanical end of this whole contract out to tender for sub-contract as was done, as far as I know, in all the other specialised sub-contracts that have arisen in the construction business up to now. If what the Minister says now in relation to the mechanical subcontract is right, surely it is right equally in relation to all the others?

No. How does that follow?

Of course is does. We got a lecture on the demerits of bringing in subcontractors and about how valuable it was not to have an intervening or extra layer between those who were designing the thing and those who were actually working in the place.

Would the Deputy give me a moment to clarify?

For once, I do not think I interrupted the Minister when he was speaking.

There is a real distinction between the processed plant because Kellog would have to be there anyway but, in regard to the jetty and other things, they do not have to be there, and where the prime contractor, the maker of the process has to be there, then you are adding another layer.

Exactly the same situation arises in relation to Asahi in Mayo and Merck, Sharp and Dohme in County Tipperary, but the huge—I will not say major—mechanical contracts in these two very complex firms were both put in by an eminent Irish firm, H. A. O'Neill——

They are not comparable.

——and there was no problem whatever created. We had a long argument here before about the structural steel contract which was not awarded to the lowest tender, which happened to be that of an Irish firm, but was awarded to an English firm, although that was not the lowest tender, on the grounds that the English firm were likely to be more competent because they had more experience. Now we have the same argument here all over again and it is really a bit much to have all this constant denigration of Irish ability and Irish enterprise time after time from the Minister for Industry and Commerce. He has at least by his apology tonight in relation to what he said in Cork partially cleared the air but I would regard his apology at best as a partial apology only when, almost in the same breath, he said it would be much more satisfactory to have Kellogs doing it because they would be more reliable and they are more likely to be on time and more likely to do it properly.

The Minister told us Kellogs were now beginning to recruit staff. They are—from all these other Irish firms which built up trained staff in the hope and expectation of jobs such as this and arising out of jobs like the long list I gave last night of tremendous complexity which they successfully carried out for public and private firms over the past couple of years. The Minister told us Kellogs were now setting up a training school at Marino Point to train operatives. Who will pay for this? The Irish taxpayer in the long run will pay for it. If one of the major Irish firms which have successfully carried out work of approximately equal complexity, if one of those, such as the one I mentioned, or even one of several others, were allowed to tender for this and were successful, there would be no need whatever to set up a training school because their work force are already trained.

I pointed out last night one of the disadvantages of a two-day debate like this is that the Minister, who only comes in on the second day, does not take any account at all of what was said on the first day. One of the advantages that I pointed out of putting this out to tender and, hopefully, an Irish contractor getting it, is that these Irish firms have continuously been training apprentices in technology of this kind and they would be in a position to train more apprentices in this very important technology to the benefit of this country. Kellogs are not going to train Irish apprentices. They are not interested in them. All these Irish firms, like O'Neills and all the rest of them, have been paying annual levies to AnCO. They have been carrying out the training of apprentices and skilled operatives on a continuous basis. All the incalculable value that could be got from an existing Irish firm with a trained work force, with its own apprentices which it is prepared to continue to train, is being thrown away because Kellogs are allowed to come in here, without any tender whatever, on a once-off job and carry on as they like without any obligations in regard to the future training of anybody other than those they need for this particular job.

They did tender. It was put out to tender.

I am not talking about the overall tender for the design. I am talking about this mechanical subcontract.

There was not a separate tender.

I know there was not. That is the whole point and I think it is appalling and so does everybody else think it is appalling.

The Deputy has stopped talking about £10 million.

If the Minister would stop interrupting me we might be able to make some progress. We have the situation that we are talking about a complex contract about which the Minister tonight and the Parliamentary Secretary last night kept making assertions. The managing director of NET in a letter he wrote to The Irish Times on 24th May said, with regard to the issue, that it is necessary to understand the nature of NET's contract with Kellog and then he goes on, as the Minister did tonight and the Parliamentary Secretary last night, to make certain assertions. I asked NET for a copy of the contract and they refused to give it to me. There is nobody apparently outside of the Department of Industry and Commerce and NET who knows what is in the contract. We know nothing about the penalty clause. We know nothing about the completion date. We were not told anything about these things and it was suggested by the Minister tonight that, if this sub-contract were put out to tender and some firm other than Kellogs got it, Kellogs would no longer have control over the situation and NET could not enforce the completion date. No matter how many sub-contracts there are, and there are already a large number in relation to this project awarded to Irish and other firms, the main contractor, who in this case is Kellogs, retains its overall responsibility for the completion date being arrived at and it is the main contractor's duty to ensure that every one of the sub-contractors fulfils his sub-contract to enable the main contractor, in turn, to fulfil his contract. The Minister's argument in this respect is quite an erroneous one and simply does not stand up.

We had a very valuable contribution to this debate last night from someone who knows what he is talking about. I refer to Deputy Calleary, a qualified engineer with many years contracting experience and practice behind him. He made it perfectly clear that the most useful thing from the point of view of a client who wants to get a job such as this done quickly, and we would all like to have it done as quickly as possible so that we will be ready when the gas is in, is to ensure the sub-contracts are given to competent firms which already have a trained staff and which do not have to go around, as Kellogs are now doing in Cork and other parts of the country, trying to recruit a man here, a man there and a man somewhere else and bring them together and put them into a training school, as the Minister told us tonight. Deputy Calleary told us last night, and I accept what he said absolutely, that it will take months to recruit staff and months to train the staff when recruited.

Where then is the Minister's argument in the face of that when an Irish firm, or indeed, a foreign firm, if this were put out to contract could start virtually immediately? If I had time to deal with all the Minister's arguments I think they could all equally be demolished as those particular arguments by him have been demolished.

The Deputy did not demolish them.

This is a major contract. It is not just an ordinary commercial contract. I have been endeavouring in the public interest to get a copy of the contract and I think I am entitled to see a copy of the contract. I am refused it. Apparently other people were refused it too although it is a contract of major importance. If NET have so little to hide why are they hiding this? Why not let us see the contract? Finally, I want to point out that the Minister makes the argument that a number of firms are peeved because they did not get this. It is no harm to mention that the unions concerned issued a joint statement with the firms concerned saying they felt equally strongly about it.

Amendment put.
The Dáil divided: Tá, 56; Níl, 33.

  • Barry, Peter.
  • Barry, Richard.
  • Belton, Luke.
  • Belton, Paddy.
  • Bermingham, Joseph.
  • Bruton, John.
  • Burke, Dick.
  • Burke, Joan T.
  • Burke, Liam.
  • Byrne, Hugh.
  • Clinton, Mark A.
  • Conlan, John F.
  • Coogan, Fintan.
  • Cosgrave, Liam.
  • Costello, Declan.
  • Coughlan, Stephen.
  • Creed, Donal.
  • Jones, Denis F.
  • Kavanagh, Liam.
  • Keating, Justin.
  • Kelly, John.
  • Kyne, Thomas A.
  • L'Estrange, Gerald.
  • Lynch, Gerard.
  • McDonald, Charles B.
  • McMahon, Larry.
  • Malone, Patrick.
  • Murphy, Michael P.
  • Crotty, Kieran.
  • Cruise-O'Brien, Conor.
  • Desmond, Barry.
  • Desmond, Eileen.
  • Dockrell, Henry P.
  • Dockrell, Maurice.
  • Donegan, Patrick S.
  • Dunne, Thomas.
  • Esmonde, John G.
  • Finn, Martin.
  • FitzGerald, Garret.
  • Fitzpatrick, Tom (Cavan).
  • Gilhawley, Eugene.
  • Governey, Desmond.
  • Griffin, Brendan.
  • Hegarty, Patrick.
  • Hogan O'Higgins, Brigid.
  • O'Brien, Fergus.
  • O'Donnell, Tom.
  • O'Sullivan, John L.
  • Pattison, Seamus.
  • Reynolds, Patrick J.
  • Ryan, John J.
  • Ryan, Richie.
  • Taylor, Frank.
  • Timmins, Godfrey.
  • Toal, Brendan.
  • Tully, James.

Níl

  • Andrews, David.
  • Brady, Philip A.
  • Briscoe, Ben.
  • Brosnan, Seán.
  • Browne, Seán.
  • Brugha, Ruairí.
  • Burke, Raphael P.
  • Callanan, John.
  • Calleary, Seán.
  • Carter, Frank.
  • Colley, George.
  • Crinion, Brendan.
  • Cronin, Jerry.
  • Crowley, Flor.
  • de Valera, Vivion.
  • Fitzpatrick, Tom (Dublin Central).
  • Gibbons, Hugh.
  • Gibbons, James.
  • Gogan, Richard P.
  • Haughey, Charles.
  • Healy, Augustine A.
  • Loughnane, William.
  • Lynch, Celia.
  • Lynch, Jack.
  • McEllistrim, Thomas.
  • Molloy, Robert.
  • Moore, Seán.
  • Nolan, Thomas.
  • O'Connor, Timothy.
  • O'Malley, Desmond.
  • Tunney, Jim.
  • Walsh, Seán.
  • Wyse, Pearse.
Tellers: Tá, Deputies Kelly and B. Desmond; Níl, Deputies Browne and Healy.
Amendment declared carried.
Motion, as amended, put and declared carried.
The Dáil adjourned at 8.45 p.m. until 10.30 a.m. on Thursday, 3rd June, 1976.
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