asked the Minister for Fisheries and Forestry if he is aware of the serious consequences the closure of the Scariff chipboard factory will have on employment in the East Clare region, in the timber industry generally, and for forestry management and development in Ireland; and the amount of money which would be required to continue the necessary level of financial support for Scariff in 1984.
Private Notice Questions. - Scariff (Clare) Chipboard Factory.
I am fully aware of the possible consequences which a closure of Chipboard Products Limited factory in Scariff would have on employment in the East Clare region. At the moment the company is in receivership and I would not presume to anticipate the outcome of the receiver's efforts. For the timber industry as a whole I would not regard the consequences as a major problem in the short term. Most of the company's supplies come from the State forests direct to the company.
With the intake of timber supplies by the other major pulpwood user expected almost to double in 1984 any effects on the State forest management in the immediate future would be of minor dimensions. I would provisionally estimate that public funding to achieve a viable operation at this factory in 1984 would be of the order of £3.5 million as a minimum.
The Minister will be aware that this has been a majority State-owned company using own resources. Could he give some indication of how he arrived at the figure of £3.5 million? Could he give an undertaking that he will fund the receiver to enable the plant to continue in production until such time as a full assessment is carried out into the viability of the plant and the operation costs?
In reply to the first question, this sum has been calculated by my officials on the basis of the minimum requirement for 1984. I would point out however that the company in their submission of their restructuring proposal did not wish to have this drip-feeding approach by us, and the total package they referred to us was in the region of roughly £6 million to £7 million. In reply to the second question, the question of additional moneys for the receiver to continue is a matter for the receiver. He has not made formal application to me so far in relation to this requirement.
Is the Minister aware that the timber supply to the plant was terminated? Will the Minister take steps to ensure that timber will be available to the receiver to enable our own raw material to be utilised to keep the plant in operation?
It is the Minister's responsibility. It is his timber.
I am aware that the normal procedure was adopted in relation to the State when a receiver moved in. I would again point out that I sought no application from the receiver in relation to timber supplies. However, if and when I do receive such an application, it will receive full consideration.
(Clare): Is the Minister not aware that supplies were denied last Friday to this factory and that this will have a very serious impact on the trading abilities of this company on the open market? Will the Minister ensure that they will be allowed to carry on until the receiver has an opportunity to look at the whole operation? Is the Minister aware that the estimated amount of money, not strictly to be provided but to be assured, which would be available per week to keep the operation in being is as low as £170,000, in order to have a proper examination of the viability of this operation which is the only kind we have?
In relation to the first part of the Deputy's question, I repeat that the receiver has not sought so far a continuation of a timber supply. I am aware that supplies were terminated on the receiver entering the premises. That is normal trading conditions.
This is a tough Minister.
May I finish the reply? If and when the receiver, who is now legally in charge of that company, seeks further supplies, his request will be given full consideration. In relation to the second part of the Deputy's question, again that is a matter for the receiver.
Is the Minister aware that since the receiver took over management over seven months ago they have now been making a profit and have reversed the situation that existed there previously? Would he be prepared to give the company an opportunity of proving themselves viable for the next six months by providing funds to the company?
Statements have been made about the profitability of the company. The position is somewhat different in that the total indebtedness of the company for this year would by the end of the year be in the region of £300,000. Figures have been mentioned for a five-month period. I am told that this was not selected deliberately on the part of the company but in this trade it is the best time of the year. These have shown small profits, but the sum of £7,000 which has been referred to takes into account refunds of £58,000 which were a one-off payment into their coffers. They are talking about a substantial net loss. Also, I get the impression from Deputy Barrett's question that this decision was taken lightly. I regard this as a very serious——
That is waffle.
It is not waffle. I regard this as a very serious business with serious consequences for east Clare, but it got full and due consideration by the Government. Unfortunately, we could not see our way to coming up with anything different.
On a point of order——
Deputy Haughey on a point of order.
In the case of the PMPA, Sir, you decided that you would not permit Deputies who had a PMPA garage in their constituencies to ask questions because you decided, perhaps rightly, that that would prolong unreasonably the Question Time. It seems now that you are departing from that ruling. I do not deny any Deputy his rights to ask a question but I want to contrast the situation. You are now permitting Deputies from not alone the constituency but from neighbouring constituencies to ask questions.
There are two garages in my constituency and the Ceann Comhairle knows I have two garages.
Without prejudice to holding that I have absolute discretion as to the number of supplementaries and the nature of them, I have been allowing Deputies from the constituency of Clare, three of whom have already been allowed questions. I am allowing Deputy Prendergast because he represents Limerick, and Limerick and Clare at Shannon overlap very much.
(Interruptions.)
I am going to allow Deputy Prendergast and Deputy Carey a final supplementary.
For the benefit of Deputy Haughey——
(Interruptions.)
——the reason I am asking the question is that I have been a trade union official involved for nearly ten years with this company and I was asked by the workers concerned to raise the question.
A question. I will not allow a speech.
May I ask the Minister if he will take account of the fact that this is the last remaining chipboard factory in the country; that it ties in with the expressed philosophy of all the political parties that we should optimise our indigenous industries and we should be seeking to encourage this; if he is aware of the impact that the closure of this factory will have on the whole economy of east Clare; if he is equally aware——
The Deputy cannot make a speech.
I am asking questions.
You cannot ask question after question.
(Interruptions.)
There are many places that I might look for advice——
(Interruptions.)
Do not mind the bluff.
Certainly not from Deputy Flynn.
(Interruptions.)
Order.
I am asking the Minister if he will do everything in his power to ensure that every attempt is made by this Government to see that every chance is given to the factory because in the last five months they have moved into a profitable situation——
Thanks to Fianna Fáil and their support.
——and the entire community have put their money into the project.
The Deputy is asking question after question and he should allow the answers.
Stop talking. We have had enough talking for the last year.
All the points covered by the Deputy have been considered by the Government. We are aware that this is the only chipboard manufacturing facility left in the country. We are aware of the social consequences in east Clare of the closure of this factory. I would point out, though, that the factory is in receivership and at this stage it is a matter for the receiver to handle the approach from here on.
The Minister is a majority shareholder and he owns the timber.
I am surprised at the Deputy. He is a legal man. He should know what the responsibilities of a receiver are.
Who put in the receiver?
The Bank of Ireland put in the receiver.
After consultation with the Minister.
I am awaiting any reasonable suggestion from the receiver in order to give him a chance to see where he can go from here. It is a matter for the receiver, as Deputy Lenihan should know. I know, and I am not a legal man.
Deputy Donal Carey for a concise question.
In view of the Minister's statement, will he contact the receiver to indicate that supplies of timber might be available for some time?
Deputies
Hear, hear.
That is commonsense.
See where it came from. I will offer my good offices to the receiver in any way he thinks he can use them to ensure that he will do his utmost to do the best for the company.
(Clare): I would ask the Minister if he agrees that it would be good business from the Government's point of view to ensure an investment of £3.5 million for the purpose of retaining 200 direct jobs and 200 indirectly employed people rather than attempt to replace an industry through very large grants. Is it not better business to retain these jobs and the indirect jobs with an investment in the order of what the Minister has stated instead of spending many millions more to create far fewer jobs?
As I have said, the company do not want that kind of piecemeal approach by the Government.
Why do the Government not supply them with timber? It is incomprehensible.
What is incomprehensible?
The attitude of the Minister and the Government.
The Minister pulled the plug.
In reply to Deputy Barrett's question, all these matters were considered. The company did not want a piecemeal approach. On the question of cost, the Government have a responsibility about the way in which we use taxpayers' money. If we consider the risk is too high we have a responsibility to take certain action. In this case that was the reason for our decision. The risk factor was far too high for the amount concerned.
I am calling the two questions to the Minister for Health, one in the name of Deputy O'Hanlon and the other in the name of Deputy S. Brennan.