asked the Minister for Industry and Commerce if he will take steps to prevent the closure of a firm (name supplied) in County Cavan.
Ceisteanna—Questions. Oral Answers. - County Cavan Firm.
16.
Exceptional steps have been taken over the past few years to help this firm to overcome various difficulties. While the State agencies are maintaining contact with the situation, it appears that the limit of the possibilities in regard to State help has been reached. I understand, however, that the firm is exploring the possibility of associating with another group.
Is the Minister aware that this company's difficulties stem primarily from advice they received from the IIRS in relation to the type of motor which should be used in their operation, that they purchased a large number of these motors on the basis of that advice and subsequently found them to be useless and cannot now dispose of them, and are, accordingly, in a serious financial situation primarily arising out of that, and in view of that, will the Minister now take steps to see that some special assistance is given to them to prevent the closure of a factory which is using a very valuable new technology?
I do not accept the version of reported facts as presented by the Deputy. The company was originally set up to manufacture tools, precision instruments and dies, and the concept of developing a chain saw operated tractor hydraulic unit was subsequent to the establishment of the company. The company received advice from the IIRS but to say that the source of the difficulties is primarily because of that advice is to me a travesty of the facts, facts with which I have taken care to acquaint myself. In terms of public money—I am not trying to quantify the value of the IIRS work or the time of public servants—the company has received in direct subventions £57,608 and to that one may add, perhaps, another £20,000 and that is to a firm employing not more than 20 people. It has had advice from the IDA, the NPC and the IIRS and every other State agency to which it has applied and the time has come now, I think, when it is not possible from the point of view of prudence to offer the company more public money. I wish the company success in their efforts to find a partner and I do not want to say anything that would damage them, but the scale of both effort and financing, which I outlined, given to the company, a company at present employing 17 or 18 people, has been absolutely prodigious and I am convinced further effort on our part is not warranted.
Is the Minister aware that the IIRS advised the use of a particular motor and did so without making any contact with the manufacturers of that motor and those manufacturers have since stated to the IDA and to the Department that, had they been asked, they would have said the motor on which this company has spent a large amount of money was useless for the purpose for which the IIRS recommended it?
The Deputy is presenting some facts but he is presenting them with bias. Initially, I understand, the company intended to develop their own hydraulic motor, which was a very major undertaking, and they were advised there was an alternative on the market. My understanding is that they were not advised that that alternative—I think it is now pertinent to mention that it is the Lamborghini motor made by the Italian company— would be automatically usable in a new context without development work. The suggestion here is that, because the IIRS indicated that such a hydraulic motor was in mass manufacture and available at a reasonable price, the failure to do the development work to make that motor completely reliably in the projected chain saw was the fault of the IIRS. That is the inference I think unwarranted.
Is the Minister aware that there are two motors of this type, the 136 and the 148, and the IIRS told the firm to use the 136 and Lamborghini, when they discovered it was being used in connection with the hydraulic saw, said it was totally unsuitable and that the only motor that would work was the other one and this company are now left with a large stock of 136 motors on their hands which Lamborghini will not take back and nobody else will buy?
At this stage it is probably relevant for me to put on the record of the House that the company refused to sign, and never signed, a normal service contract with the IIRS. They only took the advice which suited them from the institute. Following one instance of selective use of advice, when adjustment was suggested by the institute but was not carried out by the company, the IIRS decided to withdraw. The point at issue here is that when one goes to a State body and receives professional advice that does not exonerate one from the inferred need to do the normal research and development on a new project. It does not exonerate one from ordinary commercial prudence in committing oneself to a large purchase before the R and D is done.
The Minister is now standing over the actions of a semi-State body which are leading to the demise of this firm and I do not think the Minister should put himself in that position.
That is a statement and not a question. Deputy O'Malley asked a previous question about this and since then I have been very much in touch with the situation. I wish the demise of that firm as little as the Deputy or anybody else. I am satisfied that the whole gambit of State aid was given unstintingly and to the extent of more than £3,000 per worker in toto to that firm. I cannot accept the innuendo or the statement that its demise is the responsibility of the IIRS. I reject it and I do so as a result of having looked carefully into the matter. I hope I am convincible that if a State body were in error I would pursue them as vigorously as anybody else. In this instance I have looked at the situation and I am not so satisfied.