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Dáil Éireann debate -
Tuesday, 21 Nov 1978

Vol. 309 No. 8

Industrial Development Bill, 1978: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

In the short time this debate ran last Thursday I drew attention to the very short speech of the Minister of State. He devoted only two lines to how exactly the Industrial Development Authority expected to absorb a further £350 million in the next three years and I pointed out that that sum is almost equivalent to the total amount of grants that the authority have paid out since their establishment 20 years ago. It hardly needs to be said that everyone on this side of the House will support, encourage and praise the authority for their good work, but I should have expected more than a couple of lines on what major developments they foresaw which would require this enhanced rate of expenditure. I should have liked a few words about the reasons which led the authority to seek an increase to £1,125,000 in the amount of a grant that they will be entitled to make without going to the Government for approval. I am sure the reasons are good but I should like to have heard more about them.

I should like to dwell in some detail on the authority's task in general, about some of the obstacles with which they have to contend and about the place which industrial development—for which the authority are the main vehicle—plays in the development of our economy. In their last report and in one of their recent publications dated April 1978, Volume 4, No. 8, the authority pointed out how heavy our dependence is and must remain on foreign investment. In April the authority said:

Without a consistent flow of projects from abroad we would have no prospect of attaining our national job creation targets and implementing our programme for regional industrial development.

At the same time it must be said that, quite rightly, the IDA have adopted the policy of trying to reduce this dependence on foreign-based industry and of trying to increase the ratio of industrial investment from Irish sources. That is a wise policy, for reasons which I am sure are the same as those of the authority. Worthwhile foreign investments which do not require us to contribute too much as regards the environment or some other loss that another country would not be prepared to suffer are becoming increasingly hard to get. Foreign competition, even from rich countries, is becoming more intense each month; and while it might have been possible when we were outside the EEC to match that with more intensified incentives, obviously there is a limit to our freedom now to adjust or to improve incentives. As the Minister knows, it is likely that our entire incentive structure will be increasingly under EEC control and will be geared decreasingly to the special needs of the Irish economy. For those reasons the IDA are quite right to match it with efforts at home and always to maximise Irish participation in industrial development.

I should like to say here in parenthesis that the frequent prejudice I hear voiced against multinationals is very misplaced in the Irish setting. The facts which the IDA have circulated make it clear that multinationals in the ordinary sense of the word do not really play much part in our industrial scene, and what part they play is very heavily export-oriented. The IDA have made this point very clear. The moment any foreign-based company comes here, even if it only has one other settlement, it is a multinational because of that very fact.

Early this year the IDA published a Study on a Profile of Grant-Aided Industry in Ireland by Dermot McAleese. In a section that summarised the findings of the study it was pointed out that the substantial volume of trade between overseas firms and their parent affiliated companies also reflect to a certain extent the high degree of multinationality of many of the firms. The multinationals with their marketing and personnel links and their knowledge of market conditions in other countries are able to export an above average proportion of what they produce. That is an advantage to us but I do not hear it mentioned in the occasional condemnatory discussions of multinational companies.

The IDA are trying to diversify investment. In the last year for which they have reported they succeeded in increasing the Irish share of new industry to more than 50 per cent. That is a substantial achievement. But it appears that the inherently vulnerable nature of industry is even more vulnerable in the case of some foreign-based industry who may be impelled, by factors that do not entirely arise in this country but in places over which we have no control, to curtail their operations here. The disastrous effects that this can have on a region or country were exemplified this time last year. The single act of the closure of the Ferenka plant meant that that entire region reported a net loss in industrial employment for the year. That single closure meant that the efforts, so far as they were to be evaluated regionally, of the IDA and of everybody involved in industrial development had been put back. The number of jobs involved was so enormous it exceeded the net job creation.

The confidence of the IDA in their 1978 targets, which are ambitious, appears to be related to new job creation and not to a net increase in industrial employment. The Taoiseach made a speech a few weeks ago and I tried to have a crack at it a couple of times but no one took much notice. He seemed to be imparting an extraordinary piece of wisdom. He said that failure to reach industrial employment targets this year would be due to redundancies. An industrial programme must take account of potential redundancies as well as the creation of new jobs. You might as well say that a failure to reach inflation targets is due to continuing high prices or that a failure to lower unemployment rates is due to a shortage of jobs. To say that the failure to reach employment targets is due to redundancies is only telling us in a different language that they have failed.

Between June 1977 and June 1978—the June 1978 figures have not yet been printed but it is possible to extract them in a rough form from a written answer given last week by the Minister for Economic Planning and Development—manufacturing industrial employment seems to have risen by only 3,300 jobs. Conveniently enough, June 1977 was the last quarter for which details were available before the change of Government. By this time tomorrow we will probably have the printed figures from the Statistics Office. This is a small increase in industrial employment. In the same answer the Minister for Economic Planning and Development gave figures for job creation in the public sector, in other words, for the installation of young men and women at desks. He said that public service jobs increased by nearly two-and-a-half times that volume, by 10,700. Many people have computed that it takes four jobs in industry or agriculture to sustain the drain on an economy represented by one public sector job. In a year in which an incoming Government were going to fulfil their promise of producing tens of thousands of secure jobs in natural resources and of reducing unemployment in 18 months by 25,000, we have the situation that they have made only one conspicuous inroad by creating 10,700 jobs, not one of which will make an extra blade of grass grow or produce so much as a matchbox.

Against that, the industrial growth for which the foundations were laid before the change of Government has succeeded, notwithstanding the efforts of a Government dedicated to increasing job creation in producing less than 3,500 new jobs in 12 months.

That is another slightly negative feature of the industrial development scene and one which must worry the IDA a great deal. I am sure that they sometimes find, as they did during the recession, that they had to run very hard in job creation just to stand still in the overall industrial employment picture. That is hard on them but it makes me wonder whether our structures in the Department of Industry, Commerce and Energy or anywhere else in the public service are sufficiently effective in keeping an eye on the exigencies of existing industry. I doubt that they are.

I cannot find any fault with the operations of the IDA and I am known to be fair when I point at any fault in the way in which the Department of Industry, Commerce and Energy arrange their watchdog functions in regard to existing industry. Since a job in an old factory is as good as a job in a new one, we ought to have the same kind of attention, inventiveness, innovative talent and beneficial public relations put into the business of trying to guard against redundancies, which the Taoiseach thinks are an excuse for our failure to reach job creation targets. We should have an authority which puts at least that much effort into that aspect of industrial life as the effort which is put by the IDA into the creation of new jobs.

These are qualifications on the IDA's overall point of view because they have only got one partial brief in this situation, which no doubt is a happy one for them and one which they can be congratulated. When put into perspective it somewhat qualifies it.

Some initiatives of the incoming Government which were ostensibly aimed at seconding the efforts of the IDA, turned out 18 months later to have been merely electoral ploys which were not seriously meant to work in a grownup world. The simplest and most evident example is the Employment Action Team which as recently as October and November last year was still being described by the Minister for Labour as the most important measure so far introduced in the field of youth employment and as the most important measure so far introduced in the area of job creation. These speeches were delivered by the Minister for Labour on 7 October and 25 November respectively. The situation in regard to the Employment Action Team is that the Opposition have grown almost ashamed to ask about it for fear of embarrassing the Minister on his rare appearances in the responsibility to which he was appointed. It is a long time since anyone heard much about it. Once it is admitted that it was only an election stunt no more scares will be heard about it from this side of the House. It was not seriously intended to produce anything worthwhile and has now been quietly forgotten.

The Sean Lemass-type industrial consortium was the subject of a question to which a written answer was given a week ago. It turns out that this consortium—I have complained before about the name of Seán Lemass being attached to such a twopence-halfpenny institution—met on three occasions between January and March. They had another meeting in June and another in July. From that day to this they have not held another meeting. It might not matter if this were a body with a staff and a permanent on-going existence but from questions I put down on this matter, the Industrial Development Consortium is only a name. They have no office, no premises, no staff, no budget, no resources and no equipment. They do not have as much as an office cat. That is the Seán Lemass-type weapon which was going to swing into action as soon as the new Government were formed, to second the IDA to put Irish industry back into the situation which only the Coalition's malice and incompetence had deprived it of. I unashamedly describe the Seán Lemass-type Industrial Development Consortium who manage their highly important work without so much as an office cat and without holding a meeting for four months, as an electoral ploy and nothing more. As soon as that has been frankly admitted I will lay off the subject of the Industrial Development Consortium, but until that moment comes I propose to keep on saying it.

The Industrial Development Authority are not expected by this Government, any more than they were by the last Government, to carry the entire weight of industrial development here. Both Governments would have been glad, although I do not think our appeals were ever quite as shrill and as anguished as this Government's, if the efforts of the IDA had been, in effect, backed up by the efforts of the private sector. A very curious dialogue could have been observed earlier this year between the Government and the private sector in this regard. Around 1 June you could have heard the two sides chiming at each other like church bells across the city. The Government side said: "We did all we could for you. You have nothing more to complain about. The wealth tax has been removed. Your incentives are clear to see. Your profits are safe. Go ahead and create jobs". The private sector retorted: "We cannot create jobs unless we can be sure that our profits are absolutely secure. It is not just a matter of this and that fiscal manoeuvre or manipulation which can be set at naught in the next budget. It is a matter of giving us even more". I do not intend holding up the House by documenting that statement because I am sure the Chair would not like me to be citing Minister and princes of industry against one another. You may take my word for it that I could easily document this little dialogue which went on for a couple of weeks in the summer and is still going on to a certain extent.

There was a kind of response from the private sector—I do not mean to belittle any effort made, even though I have to, to put the dimensions in perspective but I do not propose to sit back and be overawed by it just because it is something for the good rather than something for the bad—which was supposed to go some distance towards making up the ground the IDA could not make up. The consortium is described as being equipped with a six-figure budget. I do not despise six figures; I do not even despite three figures, but a six-figure budget is not serious material for making inroads into industrial development or job creation. Six figures could be as little as £100,000. I assume it will be higher than that. I want to put that kind of figure into perspective. I admit I am taking an extreme example. I have no doubt that £100,000 would go a long way towards saving a couple of relatively small enterprises in temporary difficulties but it would not go very far to keep them on their feet permanently. It was envisaged that the smelter could cost £100 million at present prices and that it would employ about 500 people. I remember the Minister saying that it would be wrong to run away with an inflated idea of the employment potential of the smelter because its employment content is known to be limited. That, of course, is not the only factor in a project like the building of a smelter. There are many other factors involved.

I am in favour of the smelter being built if it can be done economically irrespective of the relatively poor return on capital in terms of cost per job. If we look at it from that aspect and get into perspective this six-figure budget with which the private sector are responding to all the Christmas presents the Government have given them, it works out at £200,000 per job. In other words, each man working in that smelter, if and when it is built, will be standing in front of £200,000 worth of capital investment. I mention that figure to put this matter into perspective, in case anyone runs away with the idea that the private sector are breaking their necks to help the Fianna Fáil Government because I must say with all politeness and respect that their response is not much more than a token response.

I think it very naive of a Government to suppose that businessmen who may be rolling in apparent wealth one day but who could have the backsides out of their trousers the next are out of mere altruism going to put significant sums, which they could use to develop their own businesses, into businesses of which they understand nothing, merely to please a Government for abolishing a taxation measure which they thought should never have been introduced.

Another feature of the industrial development scene here is the relative lameness—I do not call it a culpable lameness because it would have been naïve to expect much more—of the response from the private sector in regard to job creation. Even the IDA have pointed out that the private sector have been very slow in coming forward with industrial investment probably because they got a fright during the recession and have to make up lost ground, build up reserves and so on. That is another unfortunate factor against the background of which the IDA's task must be viewed.

I refer again to the very poor ratio which the productive side of the job creation programme—if it can be called a programme—bears to the number of unproductive jobs created. I rely on the authority of the Minister of State at the Department of Industry, Commerce and Energy, Deputy Ray Burke, in a speech which he made on 10 March this year. In passing, let me pay tribute to the Minister in regard to his indefatigable efforts in the "Buy Irish" campaign. There is hardly a day when I do not receive a script from the Minister and that means he has been out somewhere trying to persuade people to buy Irish. It was another electoral ploy of the Government to suppose that they could guarantee a switch of 3 per cent in money spent on consumer goods to home produced goods. At the same time, I sympathise with and admire the man who has been given the awful job of trying to make that programme stick. He works very hard at it and I am glad to have the opportunity to say so. During his speech in Waterford the Minister of State said:

As we are all aware, the Government is committed to creating new jobs at a greatly increased pace. This is our first priority. However, creating jobs is not enough to stimulate and maintain economic growth. These jobs must be productive.

I draw attention to this part of the Minister's speech in order to underline the very disappointing record when the recession is over and industrial recovery has been going on since late 1975 or early 1976, according to the IDA and the CII. It is disappointing that in an entire year this fairly disappointing growth in industrial jobs has to be measured against a growth in unproductive jobs between two and three times that size.

Industrial development and the maintenance of existing industrial employment have been dealt a blow by the Government's failure to combat real threats to existing industry. Part of that failure is attributable to neglect. Every real threat to existing industry makes heavier the load which the IDA are expected to carry. If a branch of industry folds up or loses half its manpower because of competition from abroad, the IDA are expected to make up the loss by enhanced targets in their next programme. We are putting too much on an authority of this kind.

The British temporary employment subsidy alone was reckoned by the CII to have cost between 3,000 and 3,500 jobs in the clothing and footwear sectors. Those sectors—which are not very different from many other sectors—are in panic at the prospect of this country being part of the EMS while the British remain outside it if the consequence of that is that the Irish £ floats up in relation to the British £. These sectors have been weakened by events during the past few years and I understand they feel this will polish them off altogether.

That does not conclude the debate on the EMS which has other features we debated here and, no doubt, will debate again. During the debate here I would have liked the Taoiseach, the Tánaiste or the Minister for Economic Planning and Development to say something about these matters on the ground. What would happen to these sectors if we were in the EMS and Britain were not in it? Necessarily the currencies would be divided and the British £ might, through a devaluation of their own, float down vis-à-vis the Irish £. I would have wished the debate to include material on such matters from any of the Ministers.

The British temporary employment subsidy did damage in traditional industries which are labour-intensive where the wage cost differential is particularly severely felt in the price at which Irish firms are able to sell their goods. Other parts of our industrial arm have also been damaged by heavy and sometimes unfair competition from low-cost countries. I realise that protection of Irish manufacturers against imports from low-cost countries is not something which is carried out in Dublin, but some explanation must be forthcoming from the Government as to how it is that jobs are being lost in other areas where we were told 18 months ago jobs were waiting to be created, namely, the area of natural resources. Two recent instances are the leather and timber industries. Both of these are under threat from competing imports which are too cheap. These are both natural resources of the textbook kind; they are old-fashioned, traditional natural resources of the kind we learned about at school. They are not glamorous, trendy natural resources like zinc or natural gas but they are nonetheless natural resources. The leather industry is labour-intensive. It must be said that there has been some neglect when these industries have been so badly hit.

I wish to refer to another matter which is not specifically related to the IDA, though it very quickly will be if the desired result is achieved. I refer to the long-term exploitation of the Irish and adjacent sea bed. Technology has not reached the point where it is possible to exploit economically the mineral deposits of the sea bed but there is no doubt that technology will, within measurable time, reach the point where it will be possible to mine at depths which previously could scarcely be reached, let alone exploited. Potentially we are in a very favourable situation. We have a long Atlantic coastline and a large Continental Shelf. The only difficulty lies in the extent of that Continental Shelf. Here we are talking about a potential area for exploitation of immense size, possibly much bigger than the size of the country itself. That area is in dispute with the British because of various unsettled matters, mainly concerning the status of Rockall and whether Rockall can generate a territorial status of its own. That matter was the subject of negotiations with the British during the term of the Coalition Government and the intention was to submit the matter to arbitration in order to have the Continental Shelf divided between us. I was involved in this for the few weeks in which I held the Office of Attorney General.

The Continental Shelf and its possible division is a very long way from the provisions of this legislation.

I am waiting for Deputy Kelly to tell us the relevance of it. Territorial claims do not arise on this Bill.

As far as I understood it, 18 months ago we had agreed what court, or what tribunal, or what instance would decide this arbitration between us. Nothing seems to have happened. I understood from a question the Taoiseach answered a few months ago that something happened which has thrown the operation into reverse. I do not know what urgency there is on the Minister's part. I know his Department have some involvement in this matter because I remembered going to meetings with them. I urge the Minister to get a move on because, for reasons I will not go into here, we are, I think, at a favourable conjuncture for the judgment of this matter. The time might not be so favourable two, three or four years from now. It may easily be that that is the very possibility upon which the other parties to the arbitration are calculating if there is any element—and I do not allege this because I do not know what the situation is—of heel dragging.

The relevance of that to the position of the IDA is that this will require an immense investment of capital if we are even to exploit this sea bed. We should be working on that now. I have here a cutting from the German paper Die Welt of 4 October last. I do not think the Germans have a Continental Shelf in any real sense. If you were to draw a median line between themselves and their neighbours, it would go scarcely any distance into the North Sea or the Baltic. They have their eyes so closely on the ball of this Continental Shelf matter, and particularly the exploitation of the deep sea beyond the Continental Shelf in which all nations will have rights—although the particular regime for exploiting those rights, regulating them and distributing them has not yet been agreed—that they are already drafting legislation which will entitle them unilaterally to exploit areas not in their own little bit of water in the Baltic and the North Sea but in——

I wonder could the Deputy explain what connection the IDA have with German designs on the deep sea?

Perhaps I have made the point. The Minister and I may not live to see——

It is not in order to go into detail about territorial claims.

During a speech on industrial development I want to mention what everybody knows will be a major element of industrial work in the next century, that is, deep sea exploitation. I should like to know how much work has been done on that by the Government, or by the Department, either technically or legally. I have not seen any evidence that anything has been done since we left office. I do not mean to say I know nothing has been done. It may be that something has been done. We have no time to waste. I mentioned that matter about the Germans to show how far ahead of the game other people can be. They are drafting legislation which will give them unilateral rights. I tried to discover what that legislation is and I have not been able to do so. It is rather like trying to find out something about a Bill in draft here. It has not yet been made public, but it is aimed at giving them unilateral rights in their own law—and that is as good as an international law for so long as there is not an international regime—to exploit the deep sea perhaps thousands of miles away from themselves. We should not sit back and be too "little Irelandish" in this connection. We should have at least the rudiments of a legal and technical structure and an educational structure for doing the same thing when the time comes.

I want to refer now to the constraints on industrial expansion which the IDA have repeatedly identified and which the Confederation of Irish Industry have also identified. One is the prejudicial position in regard to wage competitiveness. I think it was the Minister who said the other day one of the reasons for the Government's failure to achieve job targets was the excessive wage drift.

We should not get into the industrial relations field on this Bill.

These are obstacles to industrial expansion which the authority to whom we are giving £350 million have identified. I will not flog the horse to death. The loss of wage competitiveness, or the loss of the edge which we once had vis-à-vis British industry in wage costs, must have damaged what ought to be national targets in regard to job creation which would be a job for every man and woman who want one. I do not give a hoot about Fianna Fáil's targets. I want to say in passing that one of the reasons—in my opinion the main reason—for the upward wage drift was the Government's failure to achieve the 5 per cent which we agreed was a reasonable limit. The Government's failure even to get the higher figure stuck to was directly contributed to by the Government's own fiscal and social policies. They could not expect moderation from people——

The Deputy should get away from that point. It has no bearing on this Bill.

You have borne with me well, Sir, up to this and I do not want to fight with you. We are making provision to give £350 million over the next three years or so to the IDA. Surely I am entitled to mention, even if only in passing, the constraints on industrial growth which the IDA have indentified.

It would be in order to deal with costs of production and comparable costs between this and other countries, but industrial relations are a matter for another Minister.

I will deal with industrial relations in a few minutes. On the question of competitiveness, we agree it is important to keep wage costs competitive. It is also important to keep a social balance which will mean that cost effectiveness is not achieved at somebody's expense, and that no section of the population feel they have to carry it on their backs, that it is out of their flesh and blood that competitive edge is being carved. By their fiscal policies on 1 February last, or whatever date it was, the Government destroyed any hope that people would take them at their word in this regard. They threw away the confidence the National Coalition Government had built up.

Should we therefore reimpose higher taxes?

The Minister should not think I am afraid to give a straight answer to a question like that.

The Minister and Deputy Kelly are irrelevant at the moment.

I am only responding, as the Chair will agree.

I accept that. Deputy Kelly should get back to the Bill and get away from industrial relations and fiscal policies.

In their nicely printed little annual report for 1977 the IDA said—and this is the report covering the period up to 31 December last—the growth of the economy in recent times reflects the greater moderation shown in income increases over the past two years; in other words in 1976 and 1977 national wage agreements negotiated by the effort and sweat of the Government I worked for.

In case anyone might think the National Coalition have a fifth columnist in the IDA who is able to get access to the chairman's report and write sentences into it which he did not intend, let me quote from a statement by the Minister's colleague, the Minister for Economic Planning and Development, in a bulletin issued by the Department of Foreign Affairs on 1 March in which he attributes the resumption of industrial growth partly to the rate of increase in world import prices and partly to the recent strength of sterling. He said that it is also the fruitful outcome of the income restraint achieved in 1977. I do not wish to bang the drum about that since one of my own political adversaries had the grace to admit it as he has had the grace to admit so much else but I shall be expecting a continuing stream of revelations from the Minister for Economic Planning and Development. I shall not attempt to make fun of him, but who achieved that restraint? Who set the tone for the growth and expansion which both the Minister and the IDA now certify as having begun and taken root long before this Government were heard of? The CII, in which also I am not aware of our having any fifth columnist, say that since the trough of the international recession was reached in the autumn of 1975, Irish industry had maintained an expansion rate close to 10 per cent per annum. In their newsletter of 26 September they attribute a large part of that development to the moderation of the wage increases that were negotiated during the past couple of years but not including, of course, the 1978 agreement.

I do not wish to be regarded as the prophet of doom but the signs at the moment are not good. What looks like being an even worse failure next year is attributable directly to the fiscal and social policies which broadly speaking amount to telling the industrial worker that he is expected to carry the can for people who are not only ten times but perhaps 100 times better off than he.

This party are regarded by some people, but regarded wrongly, as conservative. Admittedly, there were some who were not in favour of the wealth tax and some who were not in favour of taxing farmers but I do not know of any one in this party who would have agreed with a budget of the type that was introduced here this year.

The Chair has given the Deputy a tremendous amount of latitude and he is trespassing on that to a great extent. The Bill deals only with two or three small matters.

I wish to conclude my contribution by offering to the House a few of my own views, some of which will not be new, in regard to what I think would be useful policies for achieving industrial expansion. My remarks will not be contentious politically but will be related closely to the job that has been given to the IDA.

As I have said, the IDA are correct in their policy of trying to diminish their total dependence on the attraction of vulnerable large-scale industries and in concentrating more on industrial organic growth, especially within the smaller enterprises, from within the four corners of our human resources and material. Instead of aiming for large and spectacular overnight development which can make big headlines, which a Minister can open four or five times by inviting the art editors of the papers to send along their photographers four or five times, we should be laying the groundwork for building up an industrially-minded people. At school we learned that the reason for the North of Ireland being ahead of us industrially, as it was in those days, was that the people there, many of whom were migrants in the first instance, had an industrial tradition. We all learned about the parts of Ireland to which exotic people—they were not exotic in terms of more prosperous countries—came and set up industry such as the Huguenots who came to Portarlington and set up industries of a kind never heard of in Ireland up to then. These people had an industrial tradition, too.

Our aim should be to develop, not overnight obviously, but during a period of five, ten or even 15 years, an understanding among the ordinary people of what industry is about. This was a subject that I was not taught anything about at school. At one time there was among the Irish the foolish kind of assumption, especially among middle-class society, that there was something second-rate about working on a factory floor. When such ideas are put into one's mind at an early age, it is difficult to rid oneself of them. The IDA point out that such an attitude is surprising since there are more people working in industry than in any other sector of the economy. The reason given by the IDA for this attitude is that Irish people have not been engaged long enough in industry to rid themselves of these ideas and also that the people who think in this way had parents who learned quite a different set of values. We should be aiming at developing an industrial tradition. We must endeavour to find talent for industrial enterprise and we must be prepared to release that talent when we find it.

During the past couple of weeks my attention was drawn to two chief executives of very well-known State enterprises, one in the manufacturing business and the other not in that business but both of which are extremely productive national enterprises with very good employment records. Both these chief executives started life as civil servants and remained in the civil service for some part of their working lives. There may be other people in the public service who, if granted extended sabbatical leave, would be prepared to become involved in industry. When I put this suggestion of sabbatical leave to the Minister for Public Service at Question Time, he seemed to regard it favourably. There may be people in the Civil Service who have always had a bent for industry but who found themselves in the public service because of the assumption that the white-collar-job was preferable to a job in which one's hands became soiled. If there are such people in the public service they may be afraid to take the risk of leaving their jobs and that is why I was suggesting to the Minister for the Public Service that he explore the possibility of an extended scheme of leave whereby the people concerned could be assured of being able to resume their public service positions if they so wished. Although such people might have every wish to throw themselves on the industrial wave and might even qualify for the first time entrepreneurial grant system which the IDA have instituted and which looks like being so successful, they would be reluctant to risk secure employment, pension rights and so on, especially if they were no longer in their twenties but with the assurance of being able to resume their Civil Service jobs, I am sure they could be lured into industry. I suspect that the public service is a reservoir of talent. For decades the cream of school leavers entered the Civil Service though I am sure there are people there in the vigour either of youth or of middle age who if given some encouragement would take a chance in industry or in the area of commerce, for instance, in marketing. We depend to a large extent on the occasional individual who has a gift or a flair for enterprise and that is why we would be foolish to neglect any such talent. When I raised the matter of sabbatical leave with the Minister for the Public Service he said that although he would not devise a scheme as such he would receive applications sympathetically.

A scheme, of which public servants would be appraised would be a more effective way of achieving what I am suggesting. I said in a speech a few weeks ago—unfortunately it was a speech in which I said something about neutrality with the result that everything else in the speech got buried—that, although I value the voluntary element in education as much as anybody, there would be a strong case here, because of our special situation, because of the national need which everybody recognises, to include as a compulsory subject, not for examination purposes—I know that once you do not examine a subject the compulsion element does not seem so compelling—nonetheless to include in respect of anyone receiving a State grant or State assistance in any shape or form, in other words, pupils in all schools whether publicly or privately owned, training, which they would have to attend compulsorily, in the rudiments of industrial and of agricultural science and technology.

The Deputy is broadening the scope of the Bill very much now.

I am not attacking anyone here.

The Chair does not worry whether or not the Deputy attacks anybody. That is not the Chair's job. What I am saying to the Deputy is that he is making an interesting speech a lot of which would be more properly an Estimate speech.

I am trying to give the IDA a leg-up. One of the things they need, which they have said themselves repeatedly, is a better predisposition of people, particularly young people, to industrial enterprise, techniques and skills. However, I shall not labour the point. What I had in mind was that a course could be devised. Of course, it would require the best possible efforts from educators to make it palatable—I could not begin to devise it myself and I do not know anyone who could but I am sure it could be devised—and suitable for, say, 12 to 16 year olds of both sexes irrespective of whether they were in State or privately-supported schools. Something like that would be perhaps unthinkable in England, but that argument is the least and last one that would weigh with me.

I am sick complaining for the last ten years since I started in politics about the way everybody looks over their shoulders at what England is doing. Just because the English do not put a course of this kind on a curriculum is absolutely no reason for us not to do so, though I have not the least doubt that if the English did it we would be setting up interdepartmental committees to consider the same thing again within a year. That has been the pattern here since the State was founded but it has been particularly bad under the Minister's party. They are absolutely enslaved to the English, body and soul. The Minister is laughing. I remember him, when I was in the Seanad, bringing in a Bill into which he had copied a penalty, already 11 years out of date, word for word from an English statute.

We must get away from all these irrelevancies. The Minister has no responsibility for education or educational courses.

Sir, you have really made that point very well for me. One of the things I feel we ought to complain about is the rigid departmentalisation of life here whereby education—the word you yourself used—traditionally is supposed to be just a certain number of things and whether it fits one for the life one will have to lead or not does not matter a damn.

Has the Chair put the Deputy onto another line now? The Deputy must get back to the Bill.

With respect, Sir, you have voiced very trenchantly and briefly one of the points I was trying to get at. Since you have, Sir, I shall leave it because I do not think I could improve on the way you put it.

The second last thing I wanted to say in this regard bears on the psychological barrier which exists between industry and agriculture. I know the Chair will pull me up here in a moment and I shall not go very far along these lines. But it is a distinction which is an unreal one. The IDA have got a whole section or department involved in the processing of agricultural products. Of course, looked at from another perspective it is a very arbitrary line to draw. The county produces food. The line which distinguishes, on secondary, technical criteria, between a bullock on the hoof and a can of lobster soup or something like that, which is a very highly processed value-added product, is a very arbitrary one.

Lobster Bisque, and adds about 10 per cent to the value.

By the way, in any shop I go into I find that nearly all the fish soups come from Norway, if they do not come from further afield. As far as I know there is none available from Ireland. If the Minister of State, Deputy R. Burke, can find time amidst his very hard schedule to do something about that he would be doing a good day's job.

That is an unfortunate and arbitrary distinction. I say this only to provoke some different thinking about this area. I cannot really understand why it is that we have an Industrial Development Authority which will have absorbed—if it runs to the length of its chain, with the money we are now authorising be granted to them—three-quarters-of-a-billion pounds since its establishment on setting up new industry here. There is no such authority, except to the extent of the IDA having a section involved in the food processing industry, which deals with overall development in the agricultural industry short of where the tin can stage starts, or where the wrap-ping and processing stage starts. That is a matter that ought be looked at. All economic development, all job creation, all wealth production are parts of a single organic process, or we ought to look at them that way. Without asking the IDA to take on the impossible task of trying to encourage agriculture as well, it is right to say; here is the main national resource we have. Some distinguished people, the Director of An Foras Talúntais, for one, people in the private sector—people like Father McDyer and General Costello, have said frequently that the agricultural sector alone would be capable, if properly ex-ploited, of solving our job problem. Therefore why is it that that sphere is not the subject of any authority which has the same kind of brief and the same kind of cutting edge as the Industrial Development Authority? Or why cannot the brief of the Industrial Development Authority be widened—I hope I will not give them fits by saying this—so as to permit them to involve themselves in this closely related, only arbitrarily distinguished and equally important, arguably more important, branch of the economy?

The third thing I want to say—and I will spend even less time on this because I have said it so often before—is that the industrial development scene, particularly now that the IDA are concentrating more on small industry and that they are so keen, and rightly so, on making industrial investment national as much as possible rather than foreign, would be improved if the people themselves could be given a localised and therefore identifiable responsibility, in manageable units, for their own economic future, for job creation, for prosperity within their own area. As I have suggested here more than once before, I should like to see any Government—I made the suggestion in vain to my own Government—even if only as an experiment and if it does not work try something else, implement the identification of a certain number of pilot areas within which there would be created a structure like a co-operative, except that it would be a total co-operative; it would not be confined to agriculture but would be industrial as well. By the way, this is a theme I find even Ministers coming round to these days. I suppose, in their desperation for seeking solutions to overall problems they are willing to look even at the Opposition's script.

These pilot localities, to which the entire population would have access, in which the whole population would be members, could be created. Permanent teams of experts could be assigned permanently to these areas—they would live there permanently. Such experts would be drawn from the IDA, Bord Fáilte, the IIRS and an Foras Talúntais. The job of such co-operatives would be to maximise the potential of particular localities in every respect, not just in production of buildings, not just in dairy produce or in lobbying Ministers to put factories there. There are other aspects of this thing that perhaps I can go into in more detail on a more appropriate occasion. These are long term suggestions to try to dispose our population more favourably to the job we are trying to do. The very last thing I want to do, and then I will ask your permission to sit down——

You will have the permission of the Chair to sit down.

I can assure the Deputy the motion will be passed.

I am interested to see the Minister, Deputy O'Malley, here because he cited a document some years ago in a debate on an IDA Bill which I now intend to cite. I am about to refer briefly to the work of Dr. Kieran Kennedy, the Director of the ESRI, giving his impressions of a visit by him to Denmark in 1975. He published it afterwards in, I think, the bulletin of the Central Bank. He found in Denmark staggering contrasts in the policies and techniques which the Danes have used to try to achieve industrial prosperity and those which the Irish have been using since independence.

Dr. Kennedy noticed first of all the vast industrial transformation in Denmark. One hundred years ago the Danes had no industry any more than we had. In 1922 industry in this country consisted basically of a biscuit factory, a couple of boot factories and a couple of breweries. Almost 60 years later the scene has changed completely, but it has changed even more radically in Denmark, but by quite different policies and techniques. They did it by native enterprise and not by foreign enterprise. In the main, their entrepreneurs were very small scale, people who were in general fairly uneducated in the academic sense.

Dr. Kennedy reported that such education as they have tended to be in the skilled trades. They were generally working on the factory floor of an existing firm when they got an idea for a new product or process. Innovation was the keynote of the new efforts by them. According to Dr. Kennedy, they succeeded by "extremely hard work by the entrepreneur and his family while maintaining little more than a subsistence level of drawings from the business" while ploughing in retained earnings. The entrepreneurs were essentially expert in production and all that goes with it, such as design, quality and technology. He continued:

They knew little about other aspects of business so frequently stressed in Ireland (such as finance, marketing, personnel, etc.).

The tendency was to make the articles good enough to sell themselves. Dr. Kennedy stated that a cardinal influence was the prestige attached in Danish education to the industrial arts.

I could not have told when I was a schoolboy—I can barely tell it now—what the industrial arts are. I think that is shameful. I am proud to have learned this and that in school, but it would not have killed me to have spent an hour a week learning about the industrial arts, and it would not have killed the rest of the population to have done so or to do so today. It would take the strain off the State in trying to create 10,500 desks for them to sit at.

That is the kind of achievement which the Danes have had without any industrial development authority, with next to no foreign investment and without any highly prestigious state organisations to egg them on in the early days. They did it by a set of skills and talents. That is the kind of long term purpose I have been aiming at. If we could produce the kind of situation which the Danes have produced out of a country which raised little more than pigs 100 years ago, we would be striking a far greater blow for even a national objective like Irish unity than all the speechifying, editorialising, the summoning up of Wolfe Tone, the flying of flags, talking about the national inheritance and so forth. All that sort of thing is water off a duck's back to the Unionists.

What impresses a Unionist is performance. Perhaps that is not true, but he likes to hear it said about him even if it is an exaggeration. He likes to hear it said that he is efficient and it is one of his cardinal beliefs that the people of the South are not, or that they are backward. Not a thing would impress him more than to find an industrial revolution here, conducted and achieved by ourselves somewhat along the lines I have been talking about. When I hear talk like that of the Taoiseach in regard to the EMS, when he said we would have to watch carefully in case the divergence of our currency from the British would throw up yet another ditch or barrier between us and Northern Ireland, I like to give my own personal view—I have not consulted my party, I hope I am not embarrassing anyone——

The Deputy frequently does.

Not a thing would be more conducive to Irish unity than an Irish £ that would be worth more than the £ in Belfast. There is not anything that would stun and impress the Unionists more than to find their pound note is only worth 90 Irish pennies.

I am pleased to support the general intent of the Bill, namely to increase from £400 million to £750 million the limit of the grant expenditure of the IDA, and to increase from £850,000 to £1.25 million the limit on certain grants which the IDA may make to individual undertakings without prior Government approval. I see in this a valuable extension of the work of the IDA, and as such we welcome it. My party also support the proposal in the Bill to provide a widows' and children's pension scheme for IDA employees. This is only as it should be in a major State-sponsored body and we consider this legislative amendment to be entirely appropriate.

The introduction of the Bill gives us a restricted opportunity to comment on the IDA role generally. Many of us had hopes in the middle of 1977 that measures introduced by the previous Government in the budget of 1977, which were enterprising enough, and the subsequent measures of this Government in the 1978 budget, would have an impact on the employment situation. Unfortunately the IDA are faced with a situation in which they must continue to cope with continuing unemployment at an exceptionally high level. Even this week, as we vote further substantial funds to the IDA, there are almost 100,000 persons registered as wholly unemployed.

If one goes through the previous authorisations for the IDA back in 1975, when the previous Government were in office, and the subsequent 1977 Act, we had eminent personages who are now Ministers, notably the Minister for Economic Planning and Development, indicating that the true number seeking employment even then was much greater. One may assume the number is still much higher than 100,000. The magnitude of the problem facing the IDA and the Government—and as far as we can influence matters, facing the Opposition—is underlined when one considers that despite this allocation to the IDA it does not seem as though even with full utilisation of the statutory limits in the Bill any immediate affect will be felt on employment. It seems that will take considerable time. One must bear in mind that on the industrial front there has been almost total reliance on the job-creation work of the IDA. That is a sobering reflection. While we cannot go into it today since it is a matter for another debate, there is perhaps need for a further review of the Government's capital programme outside the authorisation now to the IDA. It may be that major expenditure at local government level which has an impact on industrial development and in the educational sector and the other remedial-type projects together with IDA activity will have some impact on the employment situation.

I detect a new element of sobriety, caution and post-general election reality entering into the speeches of the Minister for Industry, Commerce and Energy, the Taoiseach, the Tánaiste and other celebrated politicians who saw no great difficulty—provided they were in office—in resolving those problems. I recall that the traditional role of the Minister has been to act as a kind of fire brigade, putting up financial sandbags, stopping firms from closing, and I am glad to see that this speech of the Minister is positive and helpful and should be of considerable benefit to the IDA in their work.

Personally, I have some doubts about two key elements in the IDA strategy as outlined by the Minister. First, the Minister indicated that a major element in the IDA plan is to ensure that half—I stress that word—of the new job com-mitments comes from within Ireland. There is not a great deal of evidence as yet of the prospective success of that strategy. Things have been rather difficult in 1977 and 1978. Recalling the Green Paper and the White Paper published subsequently and the speeches, particularly of the Minister for Economic Planning and Development, where he predicted there would be no problem, that there would be about 5,000 redundancies or at the very worst about 7,000 in 1978, it seems instead we shall have about 12,000 which is much the same as we had in 1977 and 1976. So the big take-off has not occurred. The great rocket of industrial development has not lifted off. There is not great evidence that despite the outstanding work of the IDA in the past two years, which by and large has been strenuous and very successful, the desired result has been achieved. Such is the magnitude of the problem and the extent of unemployment and so severe the constraints within which any Government must operate even in the money market in the past few months, that this strategy is still not accelerating to the degree necessary to overcome the problem. Therefore, there can be no euphoria and certainly I do not think that half the new job commitments are currently coming from within Ireland. There is no great indication that they will come from within the country. I do not propose to speak at length as I know that Deputy Leonard wants to come in and perhaps the Minister may wish to conclude before 7 p.m.

It has been said by the Minister that there should be particular emphasis within the job-creation programme on natural resource based industry. Again, there is no real evidence of any great success in this strategy today. One has only to examine such industries as meat processing, food processing generally, and the timber industry in terms of employment content or the extent to which employment has been generated by oil and gas exploration or mineral development, to find that the job-creation contributions from these sectors has been rather limited. We must admit that were it not for the very large dependence on and import of foreign investment in the past three years, the IDA job-creation strategy would have gone askew in a big way.

This is not to suggest that such foreign investment is unwelcome. I never held that view and within my party I have continuously had to—if I may say so patronisingly to my own party—educate my party about the realities of a mixed economy. I have never been hostile although I have certainly been hostile to some of the practices of some foreign firms operating here. They may need some educating also and very often they have received such an education at a very heavy cost.

A further caveat regarding foreign in-vestment is the very considerable danger of which all Governments are aware that we may be creating too many hostages to foreign fortune. Even though we had the lesson of Ferenka, I do not particularly deplore it because inevitably in a major foreign investment sector one will have firms going to the wall. It was not necessarily all the fault of Ferenka or of the Government. Industrial relations had a major influence on that particular debacle.

There is a further cause for considerable worry. If it is true, as it would appear to be, that we now have a major dependence on foreign investment and that the future programme of the IDA will depend enormously on attracting further foreign investment into this country, then a critical eye has to be cast on the very exceptional package of incentives offered to prospective foreign investors by the IDA. How long is that package going to last? If Santa Claus does not continue to deliver that package to the foreign investor—by Santa Claus I mean the Irish tax-payer—then the whole strategy of in-dustrial development in this country could fall apart overnight. That is serious.

There has not been much reference by the Minister of late—and I will be particularly interested to hear his views on the matter—to the current Community situation regarding Irish export tax relief relative to new industries coming in here. It is a matter for concern and is a key element in the whole package. I am wondering how the current state of play rests in relation to that package. I do not know to what extent the Government are now availing of the maximum support of the protocol of our Treaty of Accession to the Community. If the package is under assault, as it would appear to be, then we must ensure that an equally attractive package is negotiated with the Community. The IDA incentive package has been perhaps the most attractive, largest ingredient in industrial development in recent years. As yet there is no assurance whatever that that package will be permitted by the Community to continue indefinitely. Since so much hinges around this, in the context of the moneys which are now being devoted to the IDA it is important that matter should be elaborated on by the Minister.

The Minister of State also pointed out that the Government have laid some stress on a further aspect, namely, the enterprise development programme. I welcome the fact that some 19 projects with a job potential of about 850 jobs have been approved for IDA grant assistance since January last. However, I pose the question to the Minister in the following terms. How do we explain the situation that there were only a mere 19 persons in the Republic in the last ten months who had the necessary enterprise qualifications and the necessary industrial experience but who were short of finance and who went up to the IDA in order to get their projects off the ground? Is it not something of an indictment that the number should be so small? Fair dues to the 19 projects concerned and all credit to them, but is the fact that the number is so small not a serious reflection on our domestic sense of entrepreneurial adventure?

I had prepared my comments prior to hearing Deputy Kelly on the matter. I share his view—and I think the Minister would also share it—that we still have a tremendous need to create and foster within our people, particularly our young people, a dynamic sense of productive commercial enterprise especially in the field of manufactures. It is my experience that too many of our young people who have money to invest, who inherit money or who want to obtain money, who have a flair for enterprise find that that flair is not likely to be channelled into a factory, into the production of goods, into learning a foreign language, into getting up early in the morning, boarding an aeroplane and going off to plug their wares to an importer outside this island. No, that is not the concept of Irish enterprise as yet. Too much of their money and enterprise are veered in the direction of investing in a pub or a hotel so that they would have money during the season, or perhaps they invest in a piece of land and sit around admiring it for the rest of their lives, or maybe they open up a garage and flog a few cars, or they will indulge in a bit of construction speculation.

I am not in any way suggesting that there is anything inherently wrong, undesirable or unproductive about such commercial undertakings. I know the hard work it takes in a pub, a garage or whatever. However, unless we have factories opened up by Irish people and unless we have the real growth of products by Irish people in Irish firms, the long-term industrial development of our country is definitely at risk. It is by manufactured products that we have a real major added value to our GNP. I regret very much that our sense of commercial enterprise is limited to a very small segment of our population. Very very few people are involved, and even when we look at ourselves here, we have Deputy Kelly who is an academic, we have a lawyer, a politician, member of the legal profession, an ex-trade union official and so on. I am perhaps the only one who has worked for a company in a factory and that was for a very short time. Most politicians in this House have never themselves worked in a factory. That is the kind of lack of enterprise which we have in that regard.

There is a very real need to create a genuine enthusiasm for productive capital formation at all levels in both the public and the private sectors. We must re-orient our educational system at all levels, not merely in order to place more emphasis on science and technology but also to engender in our young people the courage to take risks and develop a sense of adventure. This is where second and third level education is very much at fault. I do not propose to comment further on this but I endorse some of the comments made by Deputy Kelly.

On the domestic front I would hope the Minister would expand the role of the IDA and give that body an enlarged brief. I would hope we would see more joint ventures between the public and private sectors. I would hope to see more joint ventures between industries and firms in the private sector and also between State enterprises. There seems to be a lack in that regard at the moment.

It is proposed to increase training grants to £1.25 million. I would ask the Minister to ensure there is effective liaison between the IDA and AnCO. Two major State bodies are involved in this substantial sum and I sometimes wonder to what extent there is effective liaison and co-operation in the spending of public moneys as between these two bodies. There is a possibility that some major savings could be effected if the liaison structure between the two was somewhat better. The Minister need not travel too far to find evidence of the situation. AnCO are an enormous body. The IDA are a major body. There are two different Ministers involved and liaison may be less than effective. A sharp word on the part of the Minister would not do any harm at all.

It might be no harm, too, to examine the position of the board of the IDA. There has been a long-standing argument about the lack of trade union representation. I can see good sense in such representation, depending on who the trade union representative may be. There has been a great deal of comment by the managing director and various Ministers on industrial disputes, unofficial strikes and their disincentive to development. I remember making representations to the Minister's predecessor urging him to examine the structure of the board of the IDA with a view to have trade union representation on it. The Minister might take note of that but he should exercise the greatest care to ensure that such nominees can contribute effectively to good industrial relations.

Could the Deputy be more specific?

I do not think one could be much more specific.

Surely the Deputy would like any trade unionist on the board.

Oh, no. One grows wise in old age and not any trade unionist any more than one would favour any entrepreneur participating in the affairs of the unions. This is a useful Bill. It will certainly help the IDA. On the Joint Committee on State-Sponsored Bodies we shall have an opportunity of examining further into the IDA. The Bill is limited in its function. The authorisation is certainly necessary. Where advance factories are concerned we have grown up. There was a time when every village wanted a factory of its own.

A great many of them still do.

They do but I think they accept now that the group concept is of considerable importance. Later on I shall be trying to get more advance factories into south County Dublin generally. We could do with some additional land and some additional factories. I admit this is somewhat outside the scope of the Bill.

The 1977 Act gave power to the authority to promote the restructuring of industry and a joint committee was set up constituted of the Department of Industry and Commerce, CTT, Fóir Teo and the IDA. I would like some information on the report from this committee. To what extent has it succeeded in encouraging amalgamations or acquisitions? Such committees can be very wasteful, meeting interminably and not making any real contribution. If they do not make a real contribution I would certainly not perpetuate them.

I welcome the Bill and I hope the work of the IDA, with the reservations I have expressed, will continue successfully.

I welcome the Bill. I congratulate the Minister on introducing it and making available the necessary funds. I also congratulate the Ministers of State on their efforts in their own fields of activity. Any Bill that puts the IDA in a stronger position to promote industrial growth and thereby create more jobs is particularly welcome. The necessity to raise the limits indicates how much money is involved in securing industries. Many countries are competing for whatever industries are available in the world market. A major effort must be made by the IDA to ensure that we get our share. The competition will get keener in the years ahead. The higher limits required emphasise the benefits of extending existing industries and promoting native enterprise.

At it becomes more expensive to attract foreign industry the IDA will have to concentrate on encouraging young Irish businessmen. I am glad to note the success of the enterprise development programme which was set up to assist persons with viable projects in mind who had not the necessary finance to implement those projects. Deputy Desmond was critical of the 19 projects with a jobs potential of 850 new jobs. Since this scheme came into operation a few months ago it has created a lot of interest in industrial development and public representatives have had numbers of inquiries from young persons interested in having their ideas developed by availing of this programme. There are probably more than 19 projects in the pipeline at the moment. This is a good scheme which will help to involve young ambitious people in industry. It would be a good thing if the Institute for Industrial Research and Standards were used to polish up the ideas of young people so that native projects could be brought into production. People come up with very sound ideas which with the help of the IIRS could be brought into production.

The production of farm machinery should be actively promoted. It is shameful that an agricultural country should find it necessary to import so much farm machinery. We cannot hope to produce tractors but we can produce a wide range of light machinery. In a Dáil Question earlier this year it was noted that the cost of importing machinery for preparing and cultivating soil in 1977 was in excess of £10 million and the cost of importing harvesting and threshing machinery was in excess of £25 million. An example of high quality, sophisticated farm machinery produced here are the harvesters produced by the Sugar Company. If that kind of machine can be produced here there is no reason why a wide range of farm machinery cannot be produced here. This area should be developed. It would be a poor manufacturer who could not keep up with the standards of some of the machinery that is imported. The farm modernisation scheme make grants available to the farmers and because of this they are inclined to change their machinery fairly often so this would be a profitable area to develop.

In relation to the north-eastern region the IDA annual reports over the past four or five years have said that the IDA are seeking land for industrial development. The 1977 report states that progress in County Monaghan has been slow largely due to the lack of attractive industrial sites. Clones is an example of one of the towns where the IDA claim there is a problem in relation to obtaining industrial sites. In the period mentioned in the reports land adjacent to the town changed hands a number of times. The IDA are depending on the local authority to secure industrial sites for them. If the local authority do not deliver the IDA should seek sites themselves. It is shameful that a job should be lost, not to speak of a factory or factories, just because the property market in an area is not monitored. I would ask the Minister to impress upon the IDA the need for them to become actively involved and not to depend too much on the local authority for sites.

During the last two years at least there was an annual furniture exhibition in County Monaghan. A large number of factories there produce high quality articles of furniture. We should not try to compete against highly automated foreign plants, we should concentrate on developing the skills here so as to produce articles of quality. There will always be a demand for quality articles. In the shoe manufacturing industry factories have gone into developing quality articles instead of mass production and I am aware that such quality articles are in great demand.

It is pleasing to note that the authority will exceed, by a significant margin, the job improvement target for 1978. I appeal to the Minister to ask the IDA to give special consideration to Border areas. In recent years those areas have experienced many problems and are deserving of special attention. Apart from the Dublin region, the north eastern region had the highest fall-off in job losses during the recession. That region covers counties Monaghan, Cavan and Louth. In Louth, which has well populated towns, there are many big industries, but the other counties have mainly small industries. For that reason a different approach is neccesary in Cavan and Monaghan. It struck me that the cluster-units would be very suitable for small towns. Those anxious to set up small industries experience great difficulty at the outset because they must provide a suitable site and face costly ESB connections. It would be ideal if cluster units could be established in my area and I hope the IDA will make this a feature of their future programme.

I was pleased to hear that a review of the timber industry is about to commence. If we did not export so much of our timber we would be in a position to create more employment for people at home. I believe the meat processing industry could be developed to great advantage. We all hope that more of our meat will be exported in the can and less on the hoof. It is a pity that our meat factories, which are heavily grant-aided, should engage in this. Many factories when they anticipate more animals coming on the market reduce their prices. They did this recently in anticipation of a big influx of cattle on the market during the 30-day testing, but that anticipation was groundless because cattle prices held good. During that period they did themselves a lot of harm as far as exports were concerned.

I commend the provision of advance factories. We had a case recently in Castleblayney where a French firm built a factory to the specifications of the Eurolever Company but when that enterprise failed after a short time that building was not suitable for any other industry. Many industrialists have turned it down. The IDA should insist on such factories being built to certain specifications so that they can be adapted for other industries. I wish to congratulate the Minister, and his Minister of State, on the introduction of this Bill.

As a Member of the party who were in Government when the IDA was established it is only fitting that I should welcome this amending Bill. I can recall speaking on the Bill which went through the House in 1977 and describing it as an interesting innovation. I found the figures quoted by the Minister in relation to employment-creation very interesting. The Minister of State, Deputy R. Burke, stated:

I am pleased to say that it now ap-pears that the authority will exceed by a significant margin its job approvals target of 27,000 for 1978.

While I find that figure interesting, at the same time I cannot comprehend it fully. Those figures are not reflected in the unemployment figures which are available. Indeed, the reduction in unemployment promised by a number of Ministers is not apparent. What Ministers have stated here should be placed in the proper context of the overall employment of the population. Unemployment has not come down as promised by Fianna Fáil. The recent figures show that unemployment was moving towards the 100,000 mark and that is indicative of the failure of the Government's policy to cope with one of our most serious social problems, something which will have to be faced in the coming year.

The strategy of the present Government will not be successful. I firmly believe that the rates of inflation which are the basis of their strategy will be far in excess of the figure of 7 per cent originally laid down in the Green Paper. This basic objective of holding down inflation will not be achieved because of the inflationary policies of the present Government. That will be the one serious obstacle to the success of their programme. I would like to have seen a strategy laid down which would have created a solid durable climate for expansion in industry here. It is becoming very obvious day by day that the industrial, economic and monetary strategy of the present Government will not lay down a solid base for expansion of industry in the coming years.

The question of the national wage agreement negotiations being rejected by the Congress of Trade Unions is something which the Government should comment on in more detail than they have done to date. The Tánaiste issued a statement saying that the Government had no objection to the termination of the national wage agreement system. I would like him to explain to the House in the context of industrial development how his party would like to see future wage settlements achieved. Will a free-for-all do any damage to his party's industrial policies? As yet we have heard very little on this subject. We have heard an awful lot about the EMS and world affairs, but we have heard very little solid information on the bread and butter problems which this country has to face.

There is nothing in the Bill about that.

I am merely referring to the general question of industrial policy and industrial strategy and how the IDA will meet their targets in the context of present Government policy. I am very dubious about their objectives being achieved, and it is very unfortunate that I should have to say so in this House.

There is tremendous unease in relation to pay in the civil service. There is tremendous unease in the local authorities, as witnessed by the present engineering work to rule. There is unease among industrial workers in relation to pay, and this is simply because the policies of the present Government are not seen to be socially equitable. That is putting severe pressures, especially on the lower paid workers, to take action to redress what they see as a social imbalance. I wonder, for instance, is it socially beneficial to the country to have people driving around in cars costing £5,000, £6,000 or even £7,000 without having to pay any road tax? Is there any social benefit in seeing people living in very large houses or on estates without having to pay any rates? The policy at present being pursued by Fianna Fáil will lead to grave social unrest here.

Referring to the Bill directly, the increase in the amounts of grants and payments which may be made by the authority is a reflection of inflation and also of the commitment which the IDA have to grant-aid new industry. I was interested to read in the Minister's speech that it is hoped that employment from domestic industry will amount to half of the total new employment to be created up to 1980. This is good, because there is a general feeling abroad that the foreigners can come in and announce grandiose industrial schemes which too often fall apart after a few years; whereas the ordinary Irishman, a genuine hard-working person who wants to start a small or medium sized industry, feels that he is not getting a fair crack of the whip.

This image may be wrong. I am sure the IDA have their own views on it. But certainly on a number of occasions people have approached me in my capacity as their representative expressing grave reservations and doubts about the activities of foreign concerns. One recent incident is the Ferenka closure. I do not wish to go into the internal problems there. The Ferenka owners may not have been to blame in relation to that. But certainly in my own city, or just outside it, 381 jobs were lost in the National Board and Paper Mills, simply because of a decision of an American company. There was little, if any, negotiation with the trade unions involved. They just closed down. It was closed without much consultation and without much heed to the social damage which the closure was doing to the fabric of society. These events cause social concern. People discuss them. If there is a continuation of foreign firms closing Irish people may come to look upon them with a certain amount of antipathy. There may be genuine reasons for closing or there may not, but certainly there will be antipathy.

The question of the raising of the limits on certain grants from £150,000 to £1.25 million which the authority may make without prior Government approval is also a good thing. It is a reflection of the independence which the IDA should exercise. I understand that the commitment of the Government is very large in relation to this activity. I am also confident that the authority, with their expertise, are capable of allocating funds on a very professional basis and a very rational basis. This enabling section in the Bill is to be welcomed.

In relation to the proposals of Waterford Glass to undertake a major expansion in Waterford, this is something that was before the Government for some months before it was finally passed. There should not have been a delay in this matter because Waterford is crying out for employment. Indeed the report in today's paper of the Minister's speech in relation to an advance factory reflects the feeling in Government circles about the unemployment situation in Waterford. I must welcome the proposal to establish a 40,000 square foot advance factory in Waterford and also to establish a 20,000 square foot clusters complex in Waterford. These are badly needed and the Minister's action, combined with the announcement in relation to Waterford Glass, is welcome. I would like to ask the Minister about the proposed employment in the Waterford Glass extension. A figure of 1,000 new employees has been thrown out as a suggested figure and some trade unionists locally have suggested a figure of 400. I hope that figure will be nearer the 1,000. I would like confirmation from the Minister on that.

Waterford has been hit very hard by the recession during the past five years. The National Board and Paper Mills are the most recent of a sad tale where 281 people were made redundant. I was involved with the campaign to ensure that the Munster Chipboard Company would not be a casualty of rationalisation of the chipboard industry here. The Minister for Fisheries and Forestry gave a categorical assurance to the deputation he met that the employment would be maintained in Waterford. There is a Litton Report which has been in the hands of the Government for some time but has not yet been published. I wonder what the recommendations of that report are? Usually those reports deal with rationalisation and closing down of factories. I would like to know what the Litton Report has to say about the woodpulp industry in Waterford. Water-ford will not tolerate any move towards rationalisation of the chipboard industry if it affects Waterford in any way.

Goodbodys, Dennys, Croker, Modern Plastics provide a litany of closures none of which is of direct Government responsibility. Some of them, because they were old firms, were unable to meet the requirements of EEC competition and others closed because of management. There was one case where possibly inter-union problems may have been the cause of the factory not being well es-tablished as was first hoped. The most recent one which has shown its head is the Irish Leather Company where 140 people are to be laid off at the end of January in Dungarvan and 40 people in the same company are to be laid off in Portlaw. What action has the Minister taken to establish alternative industries in Dungarvan, Portlaw and Waterford to counteract this ongoing situation?

The case in relation to Irish Leathers is a matter of international dumping. I understand that the European Tanners Federation are about to make a submission to the EEC Commissioners in regard to this dumping. I believe that it is very difficult to have it legally accepted as dumping. Are we to suffer the very cheap, sweated labour prices of the South American Continent? Will the Government tolerate a position where very cheap processed leather is imported at the cost of employment here? We have a duty to ensure the employment security of that industry in the country and, as far as I am concerned, in my constituency.

There are a few aspects I would like to discuss in relation to industrial policy in general. What influence is exerted in relation to an applicant for an industrial grant for a new industry to site it in a particular place? Is ministerial pressure put on an applicant to site a factory in Dublin, the north-west, the west, the south-west or the south-east? I have been told on several occasions in my constituency that pressure is put on applicants to go to a certain place. I do not want that pressure to be mixed up with the percentage differences in grant aid as between the designated areas and the non-designated areas. I am talking about political pressure which many people feel is put on incoming new industries because of the standing of Ministers or Ministers of State and their desire to show their constituents that because they are Ministers they can bring new industry to their constituencies. This myth or truth should be pinpointed once and for all. I would like a categorical assurance that no pressure is put on an industry to site in any particular constituency. It is important that every county, whether or not it has ministerial representation, should get a fair crack of the whip and the people should be satisfied that their particular counties are receiving a fair proportion of any new industrial establishments.

I would like again to refer to the Minister's speech as published in today's Irish Independent where he said that he is examining the suggestion that a judge would be made available to deal with the planning appeal cases and prevent them having to join a court queue. This is a good suggestion and the Minister is entitled to our support. I do not know how the present Planning Act would have to be amended but an expeditious manner of hearing planning appeal cases in relation to the establishment of new industries or in relation to the establishment of existing industries is welcome. We have had the unfortunate experience in south Tipperary, and in relation to the Beecham Group in County Clare, of narrow-minded objections by some people living in those areas. Despite assurances from our professional institutions in relation to such matters as the environment, those protesters continued to protest. In doing so they denied many people the opportunity of employment. That cannot be tolerated. I accept fully the right of people to appeal in our democracy but because of our experience there is a need for an expeditious hearing of any planning appeal case. The Minister is working in the right direction and if it is necessary to bring in an amending Bill it will be given swift passage in this House. We support fully the process of democracy but there must be bounds. We cannot hold up industry that is backed by technical expertise and where the environmental problems have been met to the satisfaction of the highest competent authorities, such as the IIRS. The process of democracy must not be so mad as to allow the lunatic fringe to hold up major industrial development projects.

Another aspect of industrial policy that has not been fully exploited relates to the corporation profits tax structure. Export sales relief in relation to corporation profits tax is fully understood and acceptable and I hope the EEC will allow us to continue with it after 1990 when the practice is to be phased out. We are only a developing country from the industrial point of view. We are in our infancy when compared with Germany, France and parts of England.

A good case could be made for reducing the level of corporation profits tax on domestic industries. If we have full employment as our objective in the next few years and if we are putting our trust in private industry, then, proper incentives must be established and understood. The present level of corporate taxation on domestic limited companies should be examined with a view to reducing the impact of such taxation on reinvested profits. In other words, where profits are proved to the satisfaction of the Revenue Commissioners to be reinvested in the expansion or modernisation of a company in order to make it more efficient, such profits should not be taxed any more than exports. They are achieving the same objective of encouraging employment and I would ask the Minister to review the matter. If the present level of taxation of company profits in the domestic economy were reduced substantially it would have a tremendous impact. People would be given an incentive to go into industry or to expand their enterprises and it would have a beneficial effect on employment.

I should like to refer briefly to the educational aspect of our industrial policy. There is a need to look at curriculum development in our second level schools. It is generally acknowledged that our schools are far too academic in relation to the subjects they offer. The teaching of practical and technical subjects costs substantially more than the teaching of academic subjects. The recent statement by the chief of the Confederation of Irish Industry indicates that we are suffering bottlenecks in relation to the availability of skilled manpower. While we are producing academics who cannot find employment, there is a bottleneck in relation to the supply of technocrats at various levels. It is caused because of an imbalance in the subjects taught in schools and an undue bias in relation to the benefit of academic subjects as against technical subjects. To my mind the technical subjects would be more suitable to our developing industrial economy.

AnCO are doing excellent work with regard to retraining and apprenticeship but I think the activities of AnCO vis-à-vis the apprenticeship scheme are duplicating the efforts of technical colleges. This matter should be looked at in order to avoid duplication of resources and to ensure a proper academic balance and a proper understanding of education for young people. It is important that balance be maintained but this is not being done at the moment at second level. The apprenticeship scheme needs to be balanced in the other direction in order to give the apprentices a proper liberal education.

I am pleased that the employment development programme is effective. I know that 19 people have received approval and that it has potential employment for 850. Anything that encourages initiative in our economy must be welcomed and I wish the programme every success. One can only admire the work of the staff of the IDA. They are competent and most expert at selling Irish industry abroad. They are tackling their task with the necessary professionalism in order to attract sophisticated multinationals to Ireland. Nothing must deter us from continuing to make Ireland an attractive place for industrialists. Nothing must deter the Minister, whether he be a Fianna Fáil, Fine Gael or Labour Minister, from pushing Ireland in every corner of the world. We are only in our infancy as regards industrial development.

With regard to EEC involvement in our industrial policy, I do not think it is effective. The lack of a proper regional fund is one basic weakness. The lack of political will to establish an effective transfer of resources to poor areas such as Ireland and southern Italy relative to Germany is one of the major failures of the EEC. There must be greater efforts made in Europe to attract industry here. Our European partners should be more helpful in relation to the establishment of industry. More capital should be made available to the IDA to ensure their capabilities in the field of industrial promotion. One can only wish the IDA well in their efforts.

I welcome this Bill, particularly the increase from £400 million to £750 million in the limit of the aggregate amount for grants and payments of a capital nature which may be made by the authority. We are all aware that the level of capital required has greatly increased. The consequence of the increased capital requirement is that the IDA will need greater resources to attract new industry.

This Bill comes at a time when there is much discussion of job creation. It is important to look at the creation of employment in three different respects. The first is the direct jobs which have been created by the Government. The Government promised to provide 5,000 jobs in 1977 and 20,000 jobs in 1978. We know that 5,000 jobs were provided in 1977 and that we are now close to the target of 20,000 jobs for 1978.

The second aspect of job creation is the net job creation within industry. We know that the net job creation within industry is lower than expected, which may be due to a time lag in uptake by industry. Efficiency in industry must increase before employment increases.

The third aspect relates to new industrial job approvals. We can see from the Minister's speech that that aspect is above target. We are pleased to welcome the results obtained by the IDA and to congratulate the Minister and the IDA on their achievements. I am glad to see that the IDA will exceed by a significant margin their 1978 job approvals target of 27,000. I am also glad to see that more than half the new job commitments will come from within Ireland. I am pleased that the IDA will publish higher job targets later in the year as a result of having to increase their targets.

I am pleased that an IDA unit is being developed in the Baldoyle industrial estate. I would ask the Minister to earmark more of them for intensive use in the north city area, particularly in the industrial estates provided by the corporation and the county council. The industries being developed on these sites, which are scarce, should provide high levels of employment. As the north side of the city is the fastest growing area in relation to second-level education, the situation there will become even more difficult unless action is taken.

I am glad to note that the enterprise development programme has been going well. The Minister's satisfaction with the response to the programme demonstrates that there are many people of adventure and enterprise in the country. A fast uptake in relation to this programme cannot be expected until the confidence of both sides, the entrepreneurs and the IDA, has increased. I look forward to an increased contribution from that sector.

We are now in a position to move into phase two of the economic development plan during which maximum reliance will be placed on native raw materials and home-based industries producing well-designed quality goods. We have a large number of young people available for employment with the necessary technology and skill, and the Minister's policies will lead to their development.

As a result of our membership of the EEC our trade is shifting towards the Continent. Statistics show that in 1972, 66 per cent of our exports went to Great Britain, 13.5 per cent to Northern Ireland and 20.5 per cent to other EEC countries. In 1977, 51 per cent of our exports went to Great Britain, 9.9 per cent to Northern Ireland, and 38.3 per cent to other EEC countries. These figures are significant. It is important to realise the extent of the shift in trade to the EEC. We should be making more provision for transport to the Continent. We should consider a comprehensive roll-on roll-off service to the Continent using large capacity ships. Nearly 90 per cent of UK exports to the Continent are by roll-on roll-off transport. The use of such transport between here and the Continent would result in significant cost savings. A great deal of our business goes through Great Britain to the Continent.

In view of the change in our export markets the Minister should consider developing a transport system from, say, Cork, using larger vessels. We are at a take-off point in relation to the development of trade with the Continent. I appreciate that we have a service between Rosslare and Le Havre. This service carries cars in the summer and other goods during the winter. The emphasis on such a system would be even greater if we were to become involved in the EMS.

If we look at development in imports we find that our imports from the EEC countries have not increased by the same proportion as our exports. It is quite likely that in future we will be purchasing more from the Continent. This means there could be two-way trade.

I would like to deal now with the reluctance to create new employment. As I mentioned at the outset, one of the problem areas is the shortfall in net job creation in industry and the fact that there seems to be a lag in employing people in the industrial areas. There is need for a fresh approach here. The IDA, in association with AnCO, might consider providing a special fund to train people for short or long working periods in industry and to take them back when, and if, there is not work for them.

In my daily work as a TD I deal with a number of young people who are looking for jobs. I have found that AnCO experience and their work training programme are very valuable and I would like to see this developed further. If more people were trained that might help to overcome some reluctance to employ these people in industrial areas. This could increase the numbers retained in industry and would give people looking for jobs, especially young people, useful experience in industry. This could be done by AnCO and the IDA could look at this in relation to the overall job creation programme. AnCO have the technical expertise and the involvement in industry to form such a link. I would like to join with other Deputies in congratulating the Minister and in welcoming this Bill.

Every Deputy must welcome a Bill which increases the amount the IDA will have to encourage foreign industrialists to set up businesses here, whether they be direct grants for plant and machinery or factories, or training grants. I am disappointed that the major cities seem to be getting the big industries while some of the underdeveloped areas have been getting very little industry. The IDA must take some of the blame for this. I am not suggesting that they are inefficient because I have stated time and time again that they are one of the most efficient, professional organisations we have at the present time. Some of the areas I know, north Sligo, Leitrim and Donegal, got practically nothing and, like other Deputies in that area, I am very disturbed at the number of advance factories lying idle.

I welcome the idea of cluster factories, three or four in different areas. There is a lot to be said for such an idea. It costs the same to bring electricity, water, sewerage and so on, to all factories. a directive must go out from the Minister to ensure that the advance factories already in existence get priority over new factories. It is sad to see so many of these factories, which were built with public money, lying idle in the counties I mentioned.

Other speakers mentioned regional development. If we are serious about this we must ensure that the regions, especially those on the western seaboard, get the development they deserve. Parts of the country seem to be booming but others have the highest rates of unemployment in western Europe. We hear lecturers talk about the under-developed areas of Italy but it has been proved that the under-developed areas in the west are as bad as, and sometimes a lot worse than, the under-developed areas of Italy.

We welcome the job target set by the IDA and will give the Government every co-operation to ensure that they are reached. Has the Minister ever consulted the IDA about a transport subsidy towards the long haul which many factories will have to take into consideration when deciding to start a business in the west? One of the greatest disincentives to setting up a factory on the western seaboard is the cost of transport. While we welcome these roll-on roll-off ferries, a great deal of thought must be given to the roads in these areas. There is no point in talking about two Irelands when many people seem to think we have three Irelands—the under-developed areas in the west being the third.

We all welcome the fact that from 1977-80 the IDA hope to encourage about 49,500 new jobs to this area. There is no point in encouraging these new jobs if different factories close down for one reason or another. We must ensure that, once a factory is located, and if it is viable, it will be kept open.

Five years ago when the Coalition came into power a certain factory in Donegal was losing £30,000 a year and everybody said it was only a matter of months before it would close. The development and managerial teams were changed and they went out and promoted their goods. Now that factory is one of the best in Donegal because the entire managerial and professional organisation was changed. When I see some of these factories closing I wonder if enough thought and managerial expertise went into investigating them to see if they could be kept open. As the years pass, it will become more difficult for the IDA to encourage new industrialists to come here and, as politicians who in some way direct the IDA, we should ensure that these industrialists are encouraged to stay.

During the election campaign Fianna Fáil candidates were talking about the thousands of new jobs which should be developed in the area of natural resources. They have now been in Government for almost two years and we have not seen any major effort to develop the meat trade off the hoof, to develop our timber and fishery resources or the area of marine biology. In these four areas thousands of jobs could be created but the Government have done nothing.

It is encouraging when one is abroad to see the brand name "Kerrygold" in every supermarket and on every aircraft. Much more could be done in this line. We should have one brand name covering a complete range of meat and dairy products and an image should be projected comparable to that of "Kerry-gold". We should prepack our own meat and fish and market such produce under a single name.

We are glad to see Irish tweed being sported in fashion shops, particularly in North America. Those in the biscuit in-dustry are to be congratulated. It costs much more to produce biscuits here than in Britain or Northern Ireland, yet we can export biscuits because of the capital incentives offered. More firms should take into consideration these tax free incentives.

Many smaller industries are suffering from unfair competition, particularly in Border areas. A question was asked in the Dáil recently about why bread is cheaper in the North than here. The IDA must examine the grants system operating at present. The reason for price differences in bread, poultry and meat products is that industrialists were given grants in Britain and Northern Ireland, while grants are not available here for bakeries and poultry production. The IDA recently turned down a grant application for an abattoir in Donegal because there are, in their opinion, sufficient meat processing units in the State. I often wonder if the IDA take into account the size of a county like Donegal. An abattoir in the midlands is not suitable for Donegal.

There is much talk about the EMS and the possible effects on Border industries. Have the Minister and the IDA given real consideration of the effect on exports of entry to the EMS, particularly if Britain does not join and our £ is higher than the British £? In such an event industries will suffer from unfair competition, especially the textile and shoe industries, and British industries will be able to compete much more favourably on the European market. I ask the Minister and the IDA to look into this matter. I understand that textile manufacturers, including Magee's of Donegal and Glen Abbey, held a meeting recently and they are very concerned about the possibility of entering the EMS without Britain. No matter what sops or subsidies we receive from the other member states of the EEC, if Britain does not join it is only a matter of time until continental efficiency overtakes us and jobs will be run down.

Idle advance factories are the greatest eyesore in the west. Before any new factories are set up, the Minister should direct the IDA to ensure that all advance factories are taken up.

An tAire chun deireadh a chur leis an díospóireacht.

I thank Deputies who contributed to the debate. It is my desire to deal as fully as possible with the points they made.

Debate adjourned.