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Dáil Éireann debate -
Thursday, 19 Mar 1981

Vol. 327 No. 11

Adjournment Debate - County Mayo Factory.

I would like to thank you for allowing me to raise this matter on the Adjournment. I did seek to raise the question of unemployment in Mayo generally and I am disappointed that I did not get the latitude which I sought.

In relation to the proposed closure of Blue Bell Factory, Ballyhaunis — Mayo, of which Ballyhaunis is a part, has suffered very badly over the past 12 months. Unemployment there has reached a critical stage. Roughly 12 per cent of the workforce in the county is now unemployed and the rate of unemployment over the past 12 months is somewhere in the region of 21 per cent, which is nearly twice the national average. If this rate of unemployment continues, we are hurtling towards a situation where we will have twice the national average unemployed. With the background of the closure of Mayco and of Travenol today, the imminent problems relating to Ceimicí Teo. at Corroy, Ballina, and the specific factory now under discussion, Blue Bell, the situation has reached enormous proportions and is totally unsatisfactory. The situation must be brought to the notice of the House. I am glad that the Minister of State at the Department of Industry, Commerce and Tourism is here——

Would the Deputy please confine himself to the subject under discussion?

Being a Mayo man, I am sure he will react in the way in which a Mayo man is expected to react in these circumstances. Blue Bell is part of a multi-national company which trades under the Wrangler name. They make jeans and shirts. I understand they have 16 manufacturing establishments in western Europe, 15 of which deal solely in jeans. The only shirt manufacturing unit is in Ballyhaunis. The situation in relation to the manufacturing of jeans is not at all satisfactory — we are told by Wrangler and Blue Bell that they are competing with a product from the Far East, specifically Hong Kong, which can be produced much cheaper than they can produce the product here. That is so and while they may have incurred losses in jeans manufacturing in Galway, Loughrea and Roscrea, as far as I know they have not incurred losses in their shirt manufacturing unit in Ballyhaunis.

There are 112 people employed in Ballyhaunis. Production commenced in 1977. The factory was officially opened two years ago by the Minister of State who is sitting opposite. I would hate to think that the same Minister would now preside over its closure. The statistics involved here in relation to the number of people employed provide food for thought. Of the 112 people employed, roughly one-third of the total number are from Ballyhaunis and the surrounding countryside, within a 10-mile radius. To put that in perspective, we are now losing one-third of the total number at work in that area. That is worse even that the disastrous situation which confronted Limerick and this country with the departure of Ferenka and, to make matters worse still, those 112 represent about 90 per cent of the female labour force at work in Ballyhaunis. There is no other female employment outlet in that area. If we are to get some idea of the serious impact of the closure of this factory in Ballyhaunis, we must look at it in this perspective.

The other, purely commercial, aspect of it which must be referred to is the loss of money in circulation in that area — and here we are talking about a country town of a very progressive type and of a wage bill of something in the neighbourhood of £.5 million per annum — which will have a very serious impact on the commercial and business life of the town and the area. As in cases like this, there are people who are hardest hit, the people who have entered into long-term repayment on things like house mortgages and property, totally dependent on a level of income to which they have become accustomed and given to understand that they had permanent employment in so far as any industrial employment can be permanent. In other words, there was no talk of any financial difficulties or any problem in relation to industrial disputes. In fact, the track record of the labour force there is second to none. The production and productivity in this company have been stated by the parent company themselves to be as good as and better than those in most of their other manufacturing institutions. At no time was there any quibble about productivity, industrial relations or any of the things that normally we hear referred to in relation to factories in trouble. This unit was self-supporting, showed a profit and had a good track record in productivity, industrial relations, management and so forth and had no problems whatever. Yet the rug has been pulled from under their feet simply, I suppose, because of the multinational nature of this operation. We are dealing with a very large company, possibly the biggest company in the world in that line of business, whose marketing sector is, I understand, based in Brussels and, from some inquiries I made, the production sector seems to have little contact with or knowledge of the activities of that marketing sector.

The production capacity in this factory is, I understand, 10,000 shirts per week. Anyway they are at present producing 6,000 per week on a short-time basis, but, as I said before and wish to reiterate, both the workers and local management in that factory have been regarded by the company as second to none. It is unfortunate that, in order to cut their losses in other areas and due to lack of productivity in Galway, Loughrea or Roscrea — I am quite sure that the people there are not to blame either — the factory in a place like Ballyhaunis, where profits are being shown, should be lumped in with the less productive and profitable areas of the company's activities and be victimised by Blue Bell. It would seem that Blue Bell made a decision many miles from Ballyhaunis, Roscrea, Galway or Loughrea at senior management level to withdraw from this country. The Minister, no doubt, will tell us that they have intimated that they will pay back any grants that have been given to them since they were set up. I suggest that this is the least that could be expected of them, but it would seem that in this case — it is not the norm and thank God for that — the purely financial, fiscal approach has been applied without any mention of moral or social obligations to the workers or the community in which the company operated. It is unfortunate that this attitude should prevail.

I understand that in this country we are proceeding through pretty rough waters at the moment and that economically we are not at the top of the league in so far as the economic future is concerned, but it is not the end of the world. There is a future for industry in this country, be it put there by multinational sources or by indigenous Irish sources. There is a bright future, and this company are taking the easy way out at this stage and showing a lack of perserverence and of the kind of understanding that one would expect from a company who have been dealing with labour forces in many countries down through the years, in that they ought to have seen themselves as having a social and moral obligation to these people. That would seem not to be the case here.

I will mention one aspect to which the Minister and the Government might put their minds. It is how to redeem the situation in Ballyhaunis. I am told that in the not too distant past this company did contract out work, shirt manufacturing, to other companies and allowed the facility of using the Wrangler name, in other words gave them a franchise. This happened with a company in the North. I understand, in the last year or two in relation to this company Blue Bell. Would it be possible to negotiate terms with them that would eventually grant the same concession to their plant in Ballyhaunis? After all, the building is owned by the IDA as are the plant and machinery within that building, as far as I am aware. We have a trained, capable, enthusiastic and determined workforce who have been badly treated — I put it bluntly — by this company both in the short notice they got of the company's intentions and in the light of the production and productivity that they have shown themselves to be capable of in that plant since it was established four years ago. It would be unfortunate if every avenue of approach was not tried at this stage to redeem that situation and retain that workforce and local management and to produce a commodity which they have shown expertise in producing in the past. I would like to know if this suggested line of action could be explored further and I ask the Minister of State to comment on it in his reply if at all possible.

Because this plant was grant-aided, there was a prohibition on the servicing of the domestic market with this product, the Wrangler shirt. I am told that there is a dearth of this commodity on the Irish market. Now that the company are releasing themselves from the obligations attaching to this grant aid, in the first instance, in the light of imports of shirts into this country would it be possible to continue this plant with Government aid? The Government should not stand back from the situation where a small amount of money is required. At this stage it may be much easier to retain and protect jobs than to create them.

We are talking here about an area where jobs are badly needed. For the first time since the famine the population has shown an increase due to the efforts of industrialists and investors in providing jobs. If the present trend continues we shall revert back to a stage where emigration will take over from where it left off 20 years ago, but with a difference that the escape routes and safety valves are no longer as open as they were. The Birminghams, Londons and New Yorks of this world have enough troubles of their own and do not provide jobs any more. Indeed, I would not accept that the people of Mayo should be forced to emigrate. They are entitled to work in their own country, and preferably in their own county.

First, may I say that I share Deputy O'Toole's concern at these closures and proposed closures. As the Deputy has so rightly pointed out, it is a very serious situation, particularly in Ballyhaunis, where this was the major industry in the town. When it started it brought new hope to the area. It is sad to see it closing after such a short time.

Briefly, as the Deputy has said, this group have a total of 160 plants throughout the world, employing about 30,000 people. They came to Galway and took over plants which were manufacturing jeans and which got into difficulties. They then took over two new factories, one in Ballyhaunis and one in Loughrea. Both of these started off making shirts. Apparently, the operation was not profitable. They did not make any money. Just as it appeared that they were at break-even point, the market in the product seemed to fall. This meant that they had to switch to making jeans. In competition with other companies, they then found themselves in trouble again. The Government grants were capital grants of £104,000 and training grants of £242,000, making a total of £346,000.

Is this for Ballyhaunis?

Mr. Gallagher

No, this is for the overall operation. This worked out at approximately £770 per job.

At a meeting in Galway on 26 February last the vice-president of Blue Bell Europe told the IDA regional management that the Irish operation had lost $14.3 million since it began. As the group were operating at the moment they had spare capacity in Europe and the parent body had decided to dispose of their Irish operations which were the least mature of their European plants. They had decided to dispose of them as a going concern.

That, briefly, is the troubled background to the closure itself. We sympathise with the people in Ballyhaunis and with those who have lost their jobs. It is well to record that we have an excellent workforce there. During the time they were in the area there were no strikes or troubles of any kind and we have had already inquiries from people interested in having something established there. We cannot be any more specific at the moment on this, but the IDA are working as hard as they can to try to ensure that something positive will be done to restore the jobs there as quickly as possible.

The Ballyhaunis unit was a very successful one and this will influence any prospective industrialist who might contemplate taking over the factory there. We cannot be too rough on the company involved, because they are good customers of another product which is being made here. It might not be to our advantage to have at this stage any bashing of the company.

The position is as outlined. The IDA and the Department will be doing their best to try to ensure that something is done as quickly as possible. I am grateful to Deputy O'Toole for his suggestions in relation to some areas which might be explored regarding the keeping of jobs there. We will pass these suggestions on to the IDA. We hope to see something done quite quickly to restore confidence in the area and to bring back the jobs which have been lost.

The Dáil adjourned at 5.15 p.m. until 2.30 p.m. on Tuesday, 24 March 1981.

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