Dáil Éireann debate -
Wednesday, 7 Dec 1983

Vol. 346 No. 7

Private Members' Business. - Closure of Scarriff (Clare) Chipboard Factory: Motion (Resumed).

The following motion was moved by Deputy Daly on Tuesday 6 December 1983:

That, in view of its importance to the national forestry programme and to the saw-mill industry and its employment implications for the nation, Dáil Éireann calls on the Government to implement the development plan for Chipboard Products Ltd., Scarriff, already prepared by the company and meanwhile, to ensure that the commercial operation of the company is no longer prevented.

Debate resumed on amendment No. 1:

To delete the words after "That" and substitute the following:

"Dáil Éireann urges the Government to support the development of a viable Chipboard Industry."

—(Minister for Fisheries and Forestry.)

Mr. O'Malley

Will I start? I will not get any value if the Minister is not over there. It is very strange. He got a rough ride last night and perhaps he does not want to come back for any more.

I made it clear last night and I want to reiterate now that sections 286 and 288 of the Companies Act, 1963, which deal with the question of fraudulent preference apply to the giving of a debenture in favour of the Minister for Finance on 11 November last. The dubious and deceitful circumstances in which this debenture was obtained were intended to have the effect of making the Government a secured creditor to the detriment of the unsecured creditors and private shareholders in Chipboard.

It seems to me that the debenture is invalid because no meeting of the board was called and the company's seal was authenticated by two (A) (Private) directors in contravention of article 14 of the memorandum and articles of the company. In any event, the unsecured creditors against whom this attempt at fraudulent preference was carried out by the Minister for Fisheries and Forestry, Deputy O'Toole, and his officials, can have the effect of the debenture set aside by applying to the court to appoint a liquidator. In fact, I understand some of them are contemplating doing this quickly.

This legal action is forced on them by the unethical efforts of a member of the Irish Government fraudulently to prefer his own claim before those of ordinary traders who understandably believed that an Irish State company would not renege on its commercial obligations.

An Ceann Comhairle

"Fraudulently" is a rather strong word.

Mr. O'Malley

It is, Sir, but I am quoting from section 288 of the Companies Act, 1963.

An Ceann Comhairle

I suppose it is all right if the Deputy is quoting from the Act. It would not be in order to allege fraud against a Deputy in the ordinary course of events.

Mr. O'Malley

I am saying the Minister is in breach of sections 286 and 288 of the Companies Act, 1963, by fraudulently preferring his own claim to that of the unsecured creditors and the shareholders——

Minister for Fisheries and Forestry (Mr. O'Toole)

The Deputy has the wrong end of the stick.

Mr. O'Malley

——who understandably believed that an Irish State company would not renege on its commercial obligations. The consequences of this commercial immorality by the Government will have far-reaching repercussions both here and abroad. If the Government have reneged in the case of a viable trading company like this, what are they likely to do with the debts of a company that clearly is not solvent like CIE?

In this connection it is worth quoting two brief messages sent to the Government by two of the foreign creditors to show the extent of their amazement. The first is dated today's date and is a telex addressed to the Minister of Economical Affairs of the Government of Ireland, Dublin and reads:

Re: Chipboard Scarriff

We are regular suppliers of material for the manufacturing of veneered chipboard for many years.

As the Irish Government is the main share-holder of Chipboard Scarriff we understand that payments are and have been guaranteed by the Irish Government for our deliveries.

Therefore we trust that our outstanding invoices are going to be paid.

Yours faithfully,

Van Hout B.V.

The other is addressed to the receiver of Chipboard Products Limited, Scarriff, from Karl Danzer of Reutlingen, Germany, and reads:

Dear Sir,

We are extremely concerned with regard to the situation which has now arisen with Chipboard Products Ltd.

We have supplied a considerable quantity of veneer which was done in good faith on our understanding that the Irish Government had a substantial majority stake in the company and as such, would have a credit viability.

It would seem that our faith in your government's commercial integrity has been misplaced and perhaps you would be good enough to give us some explanation as how this situation has possibly occurred.

Yours faithfully,

Karl Danzer.

I understand that a meeting of creditors of this company was held in Dublin this afternoon at which the foreign creditors said they dealt with State companies where the State had a majority of the shareholding in all the countries of Africa and all the banana republics of South America and never had a State company defaulted. They were amazed to find that this was happening in respect of a State company in supposedly civilised western Europe.

To put it in concrete terms as to what this means as a consequence of the Minister's action, at the meeting this afternoon a major oil company in this country which was a supplier to Chipboard Scarriff, stated that from now on they will not supply Irish State companies except on a cash and delivery basis. This has enormous consequences for companies like Aer Lingus, CIE and many others. It demonstrates the results of the kind of situation which has been brought about by the Minister for Fisheries and Forestry in a very vivid way.

In the shareholders' agreement between the parties the Minister undertook to observe normal commercial practices and standards and, inter alia, to provide a guarantee for the bank. He commissioned a technical report on the company but will not show it to the directors. That report and details of the company were hawked around to potential competitors further damaging the interests of minority shareholders.

Mr. O'Toole

That is false. The Deputy is totally irresponsible.

Mr. O'Malley

I am glad the Minister got his voice back.

Mr. O'Toole

I am surprised at the Deputy.

Mr. O'Malley

When I was saying similar things last night the Minister did not open his mouth. This and the completely unexpected sudden withdrawal of the guarantee by the majority shareholder are among several clear examples of what section 205 of the Companies Act, 1963, describes as oppression of the minority, and for which it provides a remedy which it is open to the minority shareholders to apply for and which I expect they will do shortly.

The actions of the Bank of Ireland in this matter are mystifying. Although under the shareholders agreement, section 4.03, the business of the company should be controlled by the board and it alone, the Bank of Ireland have apparently accepted the direction of the majority shareholder to put in a receiver, although all seven directors refused to ask them to do so as it was both unnecessary and inappropriate. The Bank of Ireland have done this act which has enormously and perhaps fatally damaged this company, although they are in no danger whatever of losing any money as the Government guarantee and their own charges and mortgages far exceed the amount they have advanced. In fact the amount borrowed by the company is more than £80,000 less than the amount sanctioned by the Bank of Ireland. They have refused to give the directors any reason for their action. They have ignored the board, as has the Minister, and have acted in such a high-handed fashion that this House will have to give full consideration to whatever legislative changes are needed to prevent banks in this country acting in this fashion again.

If the Bank of Ireland had required some specific and reasonable amount of money in the normal course of business, they could have requested it and the company could have paid it at short notice by coming to a discounting arrangement with some of their debtors who amount to £2.2 million. Do the Bank of Ireland propose to impose similar treatment on their other corporate customers? I ask this question because I am assured by an experienced accountant that 80 per cent of Irish companies would have receivers appointed to them within the next few weeks if the Minister's and the Bank of Ireland's criteria for Chipboard were applied generally.

The Minister has consistently said, as did the Minister of State, Deputy D'Arcy, that no embargo on expenditure was enforced by the State on this company. The untruth of these statement is proven by a letter dated 22 December 1982 from the Department of Forestry signed by M. A. Hackett stating that no capital expenditure was to be incurred without the consent of the Department. This letter was reiterated by an oral directive to the State directors to the same effect.

Is it any surprise that a Minister who has acted in an illegal and commercially unethical fashion such as I have described last night and tonight would equally have no concern for the work force and for the area in which the factory is situated? We are hearing only the start of this Scarriff saga. This will disclose as many scandals as the Minister for Fisheries and Forestry has been involved in under his other hat as Minister for the Gaeltacht.

Mr. Molloy

Which he also destroyed.

Mr. O'Toole

It is amazing to hear people on the far side of the House talking about scandal. It does not befit anybody on that side of the House to talk about scandal. I can and will stand up to other people who have accused me of scandal including Deputy Molloy.

Mr. Molloy

The Minister's performance to date is a scandal.

Minister of State at the Department of Fisheries and Forestry (Mr. D'Arcy)

This is a specific debate dealing with a specific problem, the closure of CPL in Scarriff. The scope of the debate has widened considerably. In the time at my disposal I had intended to deal with most of the questions raised but I now find that it would be physically impossible to do so. I must, however, deal with the irresponsible statements made by Deputy O'Malley. They are simply incredible. A man of his standing should know better than to make such statements.

(Interruptions.)

Mr. D'Arcy

I must put the record straight and correct the mischievous and grossly untrue accusation that the new medite mill in Clonmel has contributed in any way to the closure of CPL. This modern company is a market leader and this enterprise is a very welcome development here. Long before CPL's agreements were drawn up an arrangement was made with the medite company regarding the supply of timber. In no way has the setting up of this company affected the closure of CPL.

Deputy Daly raised the effects of the closure on the State forests. He stated that the closure would seriously affect the entire industry as far as waste disposal and thinnings were concerned. The mill in Scarriff used approximately 10 per cent of the total thinnings from State forests and there is no problem in dealing with that 10 per cent by other means. The Forestry Department can sell every ounce, the demand being so great. I want to allay any fears in this regard. We are meeting the timber council tomorrow in relation to waste but it seems that the mill in Scarriff used very little of the waste.

I turn now to the speech made by Deputy O'Malley. Rather than questioning the rights of the Government to protect the Irish taxpayer, Deputy O'Malley would be better occupied in examining his own conscience in relation to his personal involvement in advising people to invest in the Scarriff project. His advice was totally contrary to the recommendations of the IDA, an agency for which he was responsible, and the expert advice of the Department of Fisheries and Forestry. Deputy O'Malley, then a senior Minister in Government, deliberately misled local investors regarding the prospects for the future of the chipboard factory in Scarriff.

(Interruptions.)

An Ceann Comhairle

"Deliberately misled" is a bit strong.

Mr. D'Arcy

Deputy O'Malley has made accusations. I accuse him of deliberately misleading.

An Ceann Comhairle

The Minister will have to withdraw that.

Mr. D'Arcy

I withdraw the words "deliberately misled". I will say he misled the investors. He was involved at all stages in the restructuring at Scarriff.

Mr. O'Malley

There is a chipboard factory in this country now which would not be there if I had not done what I did. Who would be manufacturing chipboard now?

Mr. D'Arcy

Deputy O'Malley is blustering now. He acted irresponsibly in this matter and continues to act irresponsibly by indicating that the taxpayer should continue to finance a business which, on the basis of all the information, is nonviable technologically and financially.

Mr. Gene Fitzgerald

Who wrote that speech for the Minister?

Mr. D'Arcy

I wrote it myself. Deputy O'Malley talks when it suits him of the need for control of State expenditure. Now with his Santa Claus cap he demonstrates the reason the finances of this State were run into the ground during the period when the Government of which he was such a prominent member acted so irresponsibly in the conduct of the nation's affairs. During Deputy O'Malley's tenure in the Department of Industry and Commerce he presided over the closing of not just one timber processing plant but three.

Mr. Gene Fitzgerald

He kept Scarriff open.

Mr. O'Malley

Is the Minister suggesting that I should have presided over the closing of four plants, that I should have closed this one too?

(Interruptions.)

Mr. D'Arcy

Deputy O'Malley was not interrupted. I ask for the protection of the Chair.

An Ceann Comhairle

Deputy O'Malley spoke without interruption and the Minister should also be allowed to do so.

Mr. D'Arcy

Deputy O'Malley presided over the closing of Munster Chipboard in Waterford, Irish Boardmills in Athy and Clondalkin Pulp Mill in Dublin.

Mr. O'Malley

Is the Minister suggesting I should have presided over the closing of four plants?

Mr. D'Arcy

Deputy O'Malley's record is deplorable in relation to the wood processing industry. His contribution to the debate reveals that his ineptitude in office has continued into Opposition.

(Interruptions.)

Mr. D'Arcy

He is obviously unaware that the restructuring of CPL resulted in the creation of a private limited company and not a semi-State organisation, as he suggested. The entire restructuring of CPL was ill-conceived in a fit of political expediency by Deputy O'Malley and company. He showed callous disregard for small local investors by encouraging them to invest, against all the best advice. I accuse Deputy O'Malley of misleading investors in that company.

Mr. O'Malley

They do not feel misled. They would be getting on very well if the Minister had not interfered.

Mr. D'Arcy

It is on Deputy O'Malley's shoulders that the responsibility must lie. I would further point out to Deputy O'Malley that during his term of office a similar situation arose in Gorey. In February 1979 I specifically asked Deputy O'Malley in front of a trade union delegation whether he would save the leather factory in Gorey. His reply was that under no circumstances would he be prepared to put any taxpayers' money into it. He thereby axed 220 jobs. If this does not represent double standards, what does?

Mr. O'Malley

Does Irish Leathers still exist?

Mr. Gene Fitzgerald

I was there and the Minister did not open his mouth.

Mr. D'Arcy

Deputy Fitzgerald was not there.

An Ceann Comhairle

Deputy Fitzgerald should restrain himself and if he cannot do so he should leave the House.

(Interruptions.)

Mr. D'Arcy

During Deputy O'Malley's contribution yesterday he dealt with the credit reputation of the State.

An Ceann Comhairle

Insulting personal remarks are deprecated by the Chair and do not do the House any credit.

Mr. D'Arcy

Deputy O'Malley's willingness for narrow party political purposes to mislead people is bad enough but his unprincipled and totally irresponsible attempt to undermine the credit reputation of this State is, for a former senior Government Minister, a deplorable act. This misrepresentation of fact is not a new thing for Deputy O'Malley, as his ill-informed comments in relation to the State Guarantees Act recently demonstrate.

(Interruptions.)

Mr. D'Arcy

It is right to give a few figures regarding investment in the Scarriff factory. Following consultations and having looked closely at the figures, we find that restructuring of the factory would require approximately £3.5 million this year and a further £2.5 million next year. That is approximately £6 million of taxpayers' money. That every worker in CPL at present could get £8,000 a year for five years of taxpayers' money, produce nothing at Scarriff and save money for the taxpayer is what Deputy O'Malley is trying to prop up in this House, that every man working there could get £8,000 a year for five years on that borrowing.

Mr. Gene Fitzgerald

They would make a profit.

Mr. D'Arcy

That is not taking into consideration the amount required in interest charges on these borrowings.

Mr. E. O'Keeffe

Is that the Government's policy — to close down all the factories?

Mr. D'Arcy

I would further point out that the German and Italian companies which are interested in Scarriff have put a lot of work into it over a year——

Mr. O'Malley

Italian?

Mr. Gene Fitzgerald

Spanish.

Mr. D'Arcy

Spanish, sorry, claimed that to make Scarriff viable would require about half the staff and double the output. Those are the facts from the foreign companies.

Mr. Barrett

(Clare): They have increased their output.

Mr. D'Arcy

I want to deal now with the question of the debenture raised by Deputy O'Malley in the House. The original bank loan guarantee provided by the State in 1981 in respect of bank borrowings of £400,000 was the subject of a debenture executed in May 1981 as part of the arrangement then concluded for the establishment of CPL. The purpose of this was simply to protect any contingent liabilities for the taxpayer and was undertaken in accordance with the procedures envisaged by the State Guarantees Act of 1954. Thereafter, when the company required further working capital it was agreed that an additional amount of £700,000 would be made available by the bank to CPL on foot of a guarantee trust debenture, as had been done in the initial financial package for CPL.

As the Deputy knows, the process of effecting a guarantee under the State Guarantees Act of 1954 is, indeed, a very lengthy one. In May 1983, the draft order facilitating the guarantee was laid before the Houses of the Oireachtas. The order itself was made by the Government on 6 September 1983. The company formally sought a guarantee on 13 September 1983 and was informed in writing on 23 September 1983, when the required guarantee had been issued, of the security by means of a debenture which would be required. This was at the stage when negotiations with the foreign parties were under way and before CPL's own proposals had been fully finalised and analysed. It is, therefore, a gross misrepresentation to view this sequence of events as something sinister. It was simply the working through of the procedures envisaged in the State Guarantees Act of 1954 and followed in the path of the initial guarantees of 1981. So much for Deputy O'Malley's lengthy address to this House.

Mr. O'Malley

Why it was finalised is that it was needed for the restructuring of the company.

Mr. D'Arcy

That was the most irresponsible statement which has been made in this House for a long time.

Mr. O'Malley

Why did the Minister put in a receiver five days later, so?

Mr. Carey

He did not. The bank put in the receiver.

(Interruptions.)

Mr. D'Arcy

I would now like to continue.

Mr. O'Malley

Why did the Minister not tell the company that the receiver was going to be put in in five days when he asked them to sign the debenture?

An Ceann Comhairle

Deputy O'Malley or somebody else will have an opportunity of replying. The Minister should be allowed to make his speech.

Mr. D'Arcy

This is typical. I must object. Since I started speaking here I have been interrupted continuously by the Opposition.

Mr. E. O'Keeffe

The Minister is only speaking about Deputy O'Malley. He should keep his remarks general.

Mr. D'Arcy

Deputy O'Malley spoke on this and I am entitled in this House to speak about anybody I wish.

Mr. O'Toole

The Opposition Deputy cannot accept the facts. That is his problem. He never could, of course.

Mr. D'Arcy

That is right.

Mr. E. O'Keeffe

Deputy O'Malley is being attacked.

Mr. D'Arcy

I would like to question the Opposition who made the case in relation to the amount of money being put in by the Department of Fisheries and Forestry as compared with the moneys required to make Scarriff viable, as they claim. As far as any money in relation to manufacturing development is concerned, the IDA are the State agents who always take up this type of grant. The simple question must be asked: Why did not the IDA interest themselves in Scarriff in the initial stage of 1981? Why had the Department of Fisheries and Forestry to be brought in to guarantee funds at that time? Simply because the IDA, who were at that time under the control of Deputy O'Malley were unable to be persuaded by him, as his own State Agency, to carry out this restructuring. They advised him, and rightly so, that this was a lame duck which could not be made viable under any circumstances.

Mr. O'Malley

That is not true.

Mr. D'Arcy

Those are the answers. If it is not true, why did Deputy O'Malley run with cap in hand to the Department of Fisheries and Forestry and the Department of Finance? That is the truth and Mr. O'Malley knows that perfectly well.

Mr. O'Malley

There is a section in the Forestry Act of 1946 which envisages this being done under normal circumstances.

An Ceann Comhairle

Deputy O'Malley should remain silent. He should cease to interrupt.

Mr. O'Malley

I am trying to correct this Minister's erroneous statements.

An Ceann Comhairle

The Deputy is being grossly disorderly.

Mr. D'Arcy

We are stating the facts and Deputy O'Malley does not like them because he was the man who was involved at the time. It was he who built this white elephant. He did not warn the people at the time and did not take the advice of senior civil servants from three Departments.

Mr. O'Malley

I am proud of that fact.

Mr. D'Arcy

The Deputy is proud of building sand castles.

Mr. O'Malley

Up to a week ago chipboard was still being manufactured here and 350 people were in employment.

Mr. D'Arcy

Look at the amount of hardship created since then.

An Ceann Comhairle

Deputy O'Malley must desist from interrupting. This is not good enough.

Mr. D'Arcy

I deplore the personal attacks made by Deputy O'Malley on the personnel of the respective Departments. It is unbecoming in this House. I have been a Member of this House since 1977 and during my time here have never heard this type of attack on senior officials. I said before, when they were criticised by a member of our party and by a member of the Fianna Fáil Opposition Party, that these officials are doing a good job, what they are put there to do, not as Deputy O'Malley has suggested. I could not let the occasion pass without deploring those attacks. Have I five minutes more, a Cheann Comhairle?

An Ceann Comhairle

You have more than ten minutes, 13.

Mr. E. O'Keeffe

The Minister will never keep going.

Mr. D'Arcy

I would like to deal with the general developments of the forestry industry. When we took up office here on 8 December of last year, the general development of the industry was in a very bad state. The Minister and I have applied ourselves to three different areas of afforestation — acquisition, grading and the milling side. On the acquisition side I am glad to say that we have a policy before the present Government and am hopeful that within the next month we can get approval for that policy. Acquisition of land for afforestation is the basis of all afforestation.

I was more than disappointed to find that the land pool was approximately 22,000 acres when we took office, which was completely inadequate. There should be at least four to five years' land available for afforestation. It is our intention to try to rectify that situation and I can assure the House that within the next month or two we intend to do so.

Questions were raised by Deputy Daly, who was certainly more reasonable in his attitude, on the grading of timber. This is something which has been neglected down through the years.

Mr. Molloy

That is a great help to Scarriff.

Mr. D'Arcy

It is a big help to Scarriff. If the Deputy's party during their term of office had applied themselves to the development of afforestation here, there would be an ample supply of timber today. Not alone would it be a help to Scarriff, but to the industry as a whole. That is what is important, instead of building sand castles——

Mr. Molloy

I would be very impressed.

Mr. D'Arcy

——the sand castles which Mr. O'Malley built during his term of office from 1977 to 1981.

Mr. O'Malley

I thought we already had an adequate supply of timber. The Minister told us that a few moments ago.

Mr. D'Arcy

The grading of timber is a very important aspect of afforestation. I have found that the industry in general has not graded its timber, even at the level of clear felling. That, at least, should be the start of the grading. It is our intention over the next two months, in particular, to attempt to have research done on the grading of timber at the clear felling stage in the forest on the one hand, and in the milling side on the other. This is very important and should be taken up.

Mr. E. O'Keeffe

Tell us about Fermoy. What about Home Grown?

Mr. D'Arcy

I would like to talk about milling.

An Ceann Comhairle

Would the Deputies please cease interrupting?

Mr. D'Arcy

I have been examining the milling situation in general and I am not talking about Scarriff.

Mr. E. O'Keeffe

What about Fermoy?

Mr. D'Arcy

We have found that the milling situation is not good. What is needed there is drying, on the one hand, and grading, on the other.

An Ceann Comhairle

The Deputy has now ten minutes.

Mr. D'Arcy

I understood that I was to give five minutes to Deputy Madeline Taylor-Quinn. I really have only five minutes left.

Mr. Molloy

That is not agreed.

Deputies

No, that is not agreed.

An Ceann Comhairle

If it is not agreed, it is not agreed. But the Chair points out that it has been the custom here for months past to agree to such an allocation of time.

Mr. D'Arcy

We always had agreement here that Deputies could speak on behalf of their own constituencies.

An Ceann Comhairle

Unless it is agreed, the Chair cannot enforce it.

Mr. E. O'Keeffe

I want to hear the Minister.

Mr. D'Arcy

The Opposition should agree to allow the Deputies, on behalf of their own constituencies, to have a little say on an issue such as this. They are entitled to that. I appeal to the Opposition to agree to this. We are not taking any of the Opposition time.

Mr. O'Malley

Deputy Taylor-Quinn can speak here at the next Fianna Fáil debate.

Mr. Molloy

It is not agreed.

An Ceann Comhairle

I want to make it clear that the Chair cannot enforce any party agreement except with the agreement of the House.

Mr. D'Arcy

Have we agreement on that point?

An Leas-Cheann Comhairle

No.

Mrs. Taylor-Quinn

On a point of information, am I to assume that I am to be prevented by the Opposition from speaking on a matter of great importance in my constituency?

Mr. O'Malley

It is the Deputy's own party who decide that.

Mrs. Taylor-Quinn

My party have agreed to give me five minutes, but I understand from the Ceann Comhairle it has to be the agreement of the House. From what the Deputy has just said he is not agreeing. Am I to understand that he is trying to prevent me from speaking on something which is of great importance in my constituency?

(Interruptions.)

Mr. D'Arcy

I challenge the Opposition to be reasonable with the Deputy from Clare.

Mr. O'Malley

She can speak after the next Fianna Fáil speaker.

Mr. D'Arcy

We have had agreements on numerous occasions in this House as far as five minutes are concerned. During the last debate here I gave Deputy Wilson five minutes to allow him to make his points in relation to an item of importance in his constituency. We will see if the Opposition are big enough to do the same. I would like to point out that in relation to Scarriff of Clare, during the past two years in particular, arrangements were made to supply the raw material free and also a subsidy of £7 per tonne was given to extract that timber. A point was made last night that a favour was being done to the Department of Fisheries and Forestry by extracting this timber. This is absolutely incorrect. We have a demand for every ounce of timber in the forests. If this arrangement was not worked out there was absolutely no problem in disposing of this timber standing and having it paid for. I would like to make that point absolutely clear.

The Government recognise that there is a definite market for chipboard products in the country, but in a modern world chipboard must be produced efficiently, economically and profitably in a mill capable of generating its own resources for further investment and keeping pace with ever-changing technology. The Government are committed to finding such outlets as quickly as possible. My earnest hope is that the efforts of the receiver, with the co-operation of the Department and my Department, should only be concerned with the supply of timber. My Department should not be concerned with other items in relation to the development of this industry. That is a job for the IDA and that is where the last Government fell down. It is the IDA's role to work out the plans for development. I hope this will result in a mill that we can all be proud of. I would like to ask the Opposition to get away from the hypocrisy and pretence they operated as a Government and now they are operating as an Opposition. I deplore the conduct of Deputy O'Malley in this debate.

Deputy Taylor-Quinn rose.

An Leas-Cheann Comhairle

Before the Ceann Comhairle left the Chair he indicated to me, unless there was agreement from the House, that I could not allow Deputy Taylor-Quinn in. I am very sorry about that. Deputy Noel Treacy.

Mrs. Taylor-Quinn

On a point of order, there was an agreement between the Minister and me. The Minister agreed to go for 25 minutes and to allow me five minutes.

An Leas-Cheann Comhairle

That is not a decision of the House.

Mrs. Taylor-Quinn

If the Opposition have a genuine interest in Scarriff they should allow a Government Deputy for that constituency to speak. We have not had a Deputy from the constituency of Clare.

(Interruptions.)

Mrs. Taylor-Quinn

I want to know at this stage if Fianna Fáil want Scarriff to remain shut, because my impression, from the way they are carrying on, is that they want it to remain shut.

Mr. N. Treacy

I am pleased to have the opportunity to lend my voice to the motion before the House tonight but I regret that once again we have to come into the House and speak on a motion like this, because we have done so on many occasions during this Dáil session. It shows the callous, cold attitude of the Government particularly to industry and to the west. Scarriff Chipboard Products Limited closed down with the loss of 200 jobs on 25 November 1983 and a further loss of 150 jobs in the forests of the local area. In my constituency there is a loss of 30 jobs directly in relation to people from the Gort, Ballinakill, Woodford, Derry-brine and south Galway area in this factory and a further loss of 60 jobs in the south Galway forests, so we regret this closure.

I have to take issue with the Minister of State who has just spoken because he has launched a personal attack on Deputy O'Malley. It is obvious that the inefficient management of the country's affairs by the Government is being brushed aside by their Ministers and Ministers of State on to third parties. They must realise they are now in Government and have a duty to give leadership. There is no point in blaming people who held office, who have a proven record in office and who will have a proven record in office, long after the Coalition Government have gone out of office, in relation to what has happened in Scarriff.

I want to refer to some of the statements made last night by the Minister for Fisheries and Forestry. He stated that on 22 November he met a deputation on behalf of Scarriff Chipboard Products Limited. I was a member of that deputation, and after some persistence by members of that deputation that a meeting be held between the receiver and officials from his Department the Minister conceded. He informed the meeting he had received a request for a meeting with the receiver.

As far as I am concerned the interests of the two main parties who had financial investment, the Government who had a 64 per cent investment in the company and the Bank of Ireland who supplied some of the capital to the company, were being protected by the meeting of those people. A decision was taken in the aftermath of this meeting by the Minister and the Government to close down the company without due consultation with the board of directors, the chairman of the company, who was out of the country, and the people in the area who made an investment of £250,000 to ensure that this factory was set up. That was a very cold, callous decision without due consultation with all parties involved.

Mr. O'Toole

That is totally inaccurate.

Mr. N. Treacy

That is not inaccurate. Those are the facts. I also want to refer to other statements made by the Minister. He said that an agreement was made for a three year period from May 1981 with the company and the Department of Forestry. It is obvious that an agreement was made for a three year period and he as Minister had a duty to ensure that at least the three year period would terminate before any decision was made about this company. That three year period will not terminate until May 1984. With almost six months still to run the Minister and the Government made a decision to close down this company.

The effects of the closure of this company will be disastrous for the whole economy and for the whole western region and will ultimately lead to the loss of in the region of 700 jobs in our timber industry at a cost of approximately £50 million to the economy. The cost of job losses to the State through unemployment benefits and the payment of PRSI will be in the region of £3 million per annum and yet the Minister has complained about making an investment of £3.3 million available to keep this company viable. With regard to viable, every motion put down by Fianna Fáil in this session about any company has had an amendment for the Government about viability.

One way to make the company viable is for the Government to invest in it. The Government have a 64 per cent stake in the company and it is only fitting that they should do everything possible to protect the country's last chipboard factory. The Government should invest the necessary finance to ensure the company remains solvent for the good of the Irish economy. Major efforts have been made by the IDA, the county development team and the Department of Industry and Energy in the last two years to attract new industry here, particularly to the west, but they failed mainly because of the industrial recession here and throughout the world.

Mr. D'Arcy

As far as Ireland is concerned the problem was created by Fianna Fáil from 1977 to 1981.

Mr. N. Treacy

The Minister of State is passing the buck again. The Government have added to the numbers out of work by closing another semi-State concern. There is a skilled workforce available in Scarriff and many of them have more than 20 years technical experience in the timber industry. As a small nation can we afford to forget about such skilled people who live in Scarriff and the Clare-south Galway area? The Scarriff company have been trading for two years and, like all new concerns, have had their teething problems. In the midst of a recession and facing fierce foreign competition it was not surprising that the company would have losses, but in the latter half of 1983 they were making a marked improvement. That improvement came about because of good and astute management aided by a loyal workforce. There was increased productivity.

Mr. O'Toole

The Deputy should give the figures. He should not make bald statements like those without giving us the figures.

Mr. N. Treacy

There was a major saving in overheads and an effort by the workforce to preserve the factory by accepting minimal wage increases of the order of 3 per cent. Those people are here for the debate tonight and we should acknowledge that contribution.

Mr. Carey

They are here because they want their jobs but the Deputy wants to take them from them.

Mr. N. Treacy

The Government failed to negotiate a comparable wage increase in any other sector of the economy. The acceptance of that increase is an indication of the commitment of that workforce to the Scarriff factory. They are committed to their county and are being victimised as a result.

Closures like Scarriff will damage local and national confidence. The people of that town and surrounding areas invested £250,000 in the company, and it is not hard to realise their feelings when the Government pulled the plug. What other concern will invest in an Irish company after this heartless decision? How can we invite our people to invest in Irish industries? What economic progress can we hope to make if we turn our own people down? I have no doubt that the closure of the Scarriff factory will result in huge job losses in other ancillary timber industries. Many jobs in our forests will be lost. We must remember that many of the people concerned are young married men with big house mortgages. Some of them are small farmers who, due to the type of land they own, cannot make a living from the land. They will suffer as a result of the closure of the Scarriff factory. There is only one alternative for those people, the dole queue.

The only logical thing to do is to keep the factory going rather than paying the workforce social welfare benefits. The road haulage business will suffer also and there will be less work for drivers and helpers. The saw-mills, the main suppliers of the waste to Scarriff, will suffer also. The sale of waste to the Scarriff factory has helped keep down the overheads of many sawmills. I have no doubt that many sawmills will have to close. Have the Government considered the loss to local unsecured creditors, the shopkeepers, merchants and traders who supplied goods in good faith to a company in which the Government had a 64 per cent stake? Who will look after those people? What will happen if the Bank of Ireland decides to move in again? They will not be able to apply to have a receiver appointed and, consequently, will close it down because of lack of finance. The action of the Government was disgraceful, and it is an indication of their attitude to small concerns, particularly in the west.

Failures like Scarriff damage foreign investment confidence in Ireland. We heard last night that Spanish and German companies were interested in Scarriff.

Mr. O'Toole

Those efforts are now being wrecked by Deputy O'Malley and Deputy Treacy.

Mr. N. Treacy

As a result of the closure of Scarriff a German company in my constituency has taken a decision to cease operations from 1 February next. The only other operation that company had outside of Germany was in my constituency, but they have lost confidence in Ireland.

Mr. Carey

Will the Deputy name the company? The Chair should ask the Deputy to name the company.

An Leas-Cheann Comhairle

I do not have any control over that.

Mr. N. Treacy

I will give the name of the company tomorrow.

Mr. O'Toole

The Deputy does not know the company.

Mr. N. Treacy

If the Government were prepared to give the necessary guarantees the Scarriff factory would be in operation today. The Bank of Ireland would not have any need to worry if the Government were prepared to give the necessary guarantees. The Scarriff factory experienced great difficulty in getting timber from our forests. The Department notified the factory of five forests in the area where timber was available, but representatives of the company discovered that there were no roads or bridges through those forests to enable them to extract the timber.

In more difficult times a lot of money was invested in our afforestation programme, and there must be something wrong if our own renewable resources which are maturing rapidly are not utilised to the maximum at home. Clondalkin Pulp and Munster Chipboard closed down——

Mr. Carey

By whom?

Mr. N. Treacy

Our natural resources such as timber, turf and agricultural crops cannot be processed here. The Government are bereft of ideas. It is sad that the Government do not make an effort to process those products here to give employment to Irish men and using Irish investment. Fóir Teoranta, the IDA and the Government were involved in a rescue package for the local community before, and there is no reason why the company cannot be restructured.

Mr. O'Toole

We agree with that.

Mr. Daly

The Minister should have put that in his amendment.

Mr. N. Treacy

Time should have been given to the receiver to assess the position. He was not given time. The Government decided to terminate the operation. The life savings of 50 people are lost. What confidence can we expect those people who invested their money in that factory to have in the future of the country? There has been a major turnabout in the progress of this company in the last five months due to the efforts of staff and management. At a time when progress was being made, when the company clearly was showing profits of £1,000 per day over the last two months, it was ludicrous to terminate business and put in a receiver.

Mr. O'Toole

Would the Deputy ever check his facts and not come in here making a fool of himself?

Mr. N. Treacy

The restructuring proposals of the company would have cost something in the region of £6 million or £7 million only. It would cost something in the region of £15 million to make up for the loss of 700 jobs in this company. There is no reason why £6 million or £7 million could not have been made available to ensure this company remained an on-going part of Irish business.

Mr. D'Arcy

Would the Deputy tell us where he got the 700 jobs?

Mr. N. Treacy

The main problem with regard to the company, on the Minister's admission, was that if a dust burner was provided it would have saved the company £300,000 per annum. The cost of this dust burner would have been £100,000. Therefore, in one year, it would repay itself threefold. Why was that money not made available?

Mr. D'Arcy

It was made available.

Mr. O'Toole

A 60 per cent grant.

Mr. N. Treacy

It was not made available to the company. The situation is that the company has been closed down and whether it was 60 per cent, 70 per cent or 100 per cent, the money should have been made available for this dust burner.

Eighty per cent of Irish companies survive in the same situation as Scarriff, operating normal commercial criteria. Indeed several Irish companies are in a worse trading position and survive but they will not survive if present Government policy prevails much longer. One would nearly have to go behind the Iron Curtain or to darkest Africa to find a situation comparable with that in Scarriff——

Mr. D'Arcy

Very helpful to foreign investment.

Mr. N. Treacy

——a great community who invested their resources, expertise, formed their own local company and now find themselves without an industry or factory. What about all the young families, what about the mortgages on their houses? Perhaps it is the situation — and if so the Minister should tell us clearly — that the timber is not available. Could it be that the timber is not available from our State forests?

Mr. O'Toole

That is what is known as a red herring and well the Deputy knows it.

Mr. N. Treacy

Perhaps the main factor is that the timber cannot be extracted, that the Government have not invested or given sufficient moneys to the Department of Forestry to ensure that facilities would be available to extract the timber from our forests.

In County Galway I know there are approximately 75,000 acres of timber, with 11,190 acres of land on reserve. I know also that in County Mayo there are approximately 55,000 acres; in County Clare approximately 41,000 acres; in County Roscommon approximately 17,000 acres; in County Offaly approximately 9,500 acres; in County Tipperary approximately 62,000; in Limerick approximately 20,000 and in Kerry approximately 38,000 acres of timber. Surely, with that amount of timber available, it is ludicrous to close down this factory?

If a realistic financial package was prepared, if the company were given time to restructure themselves, there is no reason they could not survive. The Minister spoke about the technical agency, Zurich, who assessed the Scarriff company. Would he tell us the background to this company and their present position? Would he also tell us if this company were in competition with Scarriff on similar markets? Perhaps it suited that company to recommend the closure of Scarriff.

Mr. O'Toole

They did not recommend closure.

Mr. N. Treacy

But they recommended changes that suited their own market situation.

Mr. O'Toole

They made a factual assessment of the technical aspects of the company.

Mr. N. Treacy

This situation obtained over a year ago——

Mr. O'Toole

I have my ideas, mind you.

Mr. N. Treacy

——when the then Government and Minister for Forestry, Deputy Daly, investigated the situation. They supported this company to ensure that the last remaining chipboard factory in Ireland would stay in production in order that the home market would be supplied, a situation completely overturned by the present Government.

The Minister referred to the eleventh hour approach to the Irish Timber Council. Surely, when he talks about the eleventh hour approach of that council, he should also talk about the eleventh-and-a-half-hour approach of himself when he pulled the plug on the company. Can the Minister tell us whether he inspected this factory himself, or whether he went into the Cabinet and told the Government that it should be closed down.

Mr. O'Toole

The Deputy must wait until he gets into the Cabinet and then he will find out how it works.

Mr. N. Treacy

The Minister should realise that he is the one Government Minister in the Cabinet from the west, the one from Donegal to Kerry. He is the custodian of the west. He has a duty in the Cabinet to protect the interests of the west and of its people. His record to date has been one of dismal failure.

We have a situation also in Údarás na Gaeltachta in which, for political reasons, various people have been removed from the board when they were not prepared to do what the Minister wanted——

Mr. O'Toole

That is very murky water for the Deputy; he could get lost there. I am still swimming in it but I am determined that I will stay swimming in it. The Deputy should remain with Scarriff.

Mr. N. Treacy

He is the only western man in the Cabinet, which Cabinet has treatened to close down the Tuam Sugar Factory. Even today the Taoiseach failed to tell us whether and when a decision will be made.

There is also then the situation in Ballyforan, where indigenous natural raw materials——

An Leas-Cheann Comhairle

I think the Deputy should remain with Scarriff.

Mr. N. Treacy

I am talking about the natural resources of our country, a Leas-Cheann Comhairle.

(Interruptions.)

Mr. N. Treacy

We have the situation in which the Ballyforan briquette factory has been shelved, another natural resource wasted. Then there is the beet factory in Tuam, agricultural produce. If there is not the commitment to invest money in indigenous natural resources how can we hope to make progress? The sooner this Government realise that the better for this nation.

I appeal to the Minister, on behalf of the workers in Scarriff, on behalf of the people in the west, those people associated with our timber industry, that provision be made, even at this late stage, to enable the receiver obtain the necessary materials to maintain the plant running, maintaining the momentum of production that was there until 25 November.

Mr. O'Toole

It is available to him tomorrow morning if he asks for it.

Mr. N. Treacy

I want him to lift the embargo on timber supplies immediately. I also want him to ensure that the necessary finances are made available to the company, to the receiver, until the auditors' report emerges, until a reasonable amount of time has elapsed, thereby ensuring that, through proper management, investment and careful consideration by this Government, this, the last remaining chipboard factory in the country, will be maintained.

An Leas-Cheann Comhairle

By agreement with the Whips Deputy Taylor-Quinn is being allowed to speak until 8.05 p.m.; Deputy Mac Giolla from 8.05 to 8.10 p.m., Deputy Donal Carey from 8.10 to 8.15, with Deputy Barrett (Clare) to conclude at 8.15 p.m.

Mr. Daly

We were never approached about this. They should not try to misrepresent the position.

An Leas-Ceann Comhairle

Deputies, please, allow Deputy Taylor-Quinn to speak.

Mrs. Taylor-Quinn

I am delighted the Opposition have seen the folly of their ways and have decided to allow us time to speak on this very important issue here this evening. I consider the approach adopted by the Opposition extremely irresponsible. I did not come here this evening to hear from any Opposition Deputy a lecture on the 1963 Companies Act. I came here this evening to speak for the people of Scarriff, to ensure that Scarriff will have a chipboard industry in the future and that the work force who were operative a few weeks ago will be back at work in Scarriff in the near future. That is what all of us Deputies for the constituency of Clare have a responsibility to do.

I was amazed at the attitude adopted by Deputy O'Malley. He used the words "phoney" and "irresponsible". I would suggest to him that the phoney and irresponsible acts were taken early in 1981 when the take-over agreement was drafted. When that agreement was being drafted the accounts clearly showed that the Scarriff factory would not be in a position to avail of the 40 per cent capital grant they should have taken up and which would have amounted to £500,000. It was evident that the Scarriff plant would not be able to avail of that grant because they did not have the money. Therefore, it was unfair of the Opposition to suggest to the people in Scarriff that they were giving them something when in fact they were giving them something they could not avail of. The Opposition were only hood-winking the people of Scarriff. A proper injection of money should have been put into Scarriff then to ensure that it would be made viable. Fianna Fáil did not do that.

We had the assurance of the Minister that the agreement with Medite does not affect Scarriff. I can assure the House that that agreement affects Scarriff. The agreement was drafted to ensure that Medite in Clonmel would get timber within a 50-mile radius of Clonmel, but now timber is being taken from Broadford in Clare, from around the Scarriff area right down to Clonmel. That has happened because of an agreement entered into by the Opposition when in Government in 1981. As a result, Scarriff has suffered. If the company in Scarriff had not to travel for their timber to south-west Kerry and north-west Mayo they would be in a far healthier financial position. The Opposition must accept responsibility for that. I suggest to the Minister and the Department that they immediately enter into negotiations with Medite to reconsider the radius and to operate on a block release basis which would put all timber firms into a proper competitive position.

There are many reasons for the continuation of the Scarriff industry. I believe it will be continued because north-east Clare has no other industry and it would be disastrous for the area if this industry was not continued. I have an assurance from the Minister and the Minister of State that any parties interested in taking over CPL or showing any interest in developing chipboard will be directed to Scarriff. The people of Scarriff deserve every assistance. We have got a talented, skilled work force in Scarriff who have worked in the chipboard industry for the past 25 years. We have the raw material there. If the raw material in the area is used in the area and not transferred to Clonmel as at present the Scarriff plant can be made viable. The forests in Clare are of such a structure that the thinnings are becoming available more and more. We have a market here for chipboard instead of importing it. Scarriff had about 40 per cent of the market. That market could be developed and increased substantially.

That industry was traditional in Scarriff and I hope the tradition will be continued. I have no doubt that the Government, particularly the Ministers for Forestry and Industry and Energy, will do everything possible to ensure that the factory will be reopened.

We hear a lot of talk from the Opposition about their various decisions to do several things. They never paid anything to CPL in Scarriff. Payments to Scarriff were first made by the former Minister, now the Ceann Comhairle. In May of last year the present Minister for Forestry stressed those facts. This situation should not be distorted. We all have a responsibility to present the case fairly and not to be making a political ploy out of it.

Mr. Molloy

Who closed it down? It was the Deputy's friends.

Mrs. Taylor-Quinn

The Deputy knows well it was the Bank of Ireland. I am asking the Government to continue their efforts to ensure that the plant will be reopened.

Mr. Flynn

If Deputy O'Toole were not in that place over there it would not have been closed.

Mr. Mac Giolla

I have a particular interest in the timber processing industry and I am glad to be able to speak on the motion. Scarriff had the last chipboard plant in the country. It has been closed down at a time when a very rapidly increasing volume of timber is becoming available from our forests. In 1979 we had 696,000 cubic metres of timber coming from our forests. It is hoped that in 1987 that will have doubled and that by the year 2000 it will have increased by five times to 3 million cubic metres. With that volume of timber coming on stream it is vital that plants such as that in Scarriff should be maintained in production. Otherwise we will be left with nothing but Medite, a multinational company with a monopoly of the supply of timber from our forests. That would be a national disgrace and highly dangerous to the national interest.

We have had experience of many multinational companies leaving us high and dry when we needed them most. Therefore, the questions being asked about Medite are relevant. We must ask whether they put a gun to the head of the Government, because in some way they negotiated an agreement which nobody else got from the Department of Forestry. A contract like that had not been negotiated with an Irish Government in 60 years. Small sawmills or big processors were unable to get such contracts from any Government. This contract pushed Scarriff to the limits, away up to Mayo, for instance, for supplies of timber. That obviously was the result of Medite's presence.

We must ask the IDA how much taxpayers' money was supplied to Medite for a matter of approximately 60 jobs at a time when Scarriff were left short of funds and timber with consequent loss of 250 jobs.

The Minister of State hit the nub of the matter when he said it is the responsibility of the Minister to supply timber but he had no responsibility for finance which is a responsibility of the IDA and the receiver. However, when speaking yesterday the Minister said he could not go on looking for £6 million or £8 million for Scarriff.

There is no doubt that the nub of the question is the supply of timber. It was the nub of the matter in regard to Medite. That is why Home Grown Timber closed down in Fermoy a couple of months ago with the loss of 80 or 90 jobs — they did not get the timber they wanted. This will be the main issue in regard to Scarriff.

The Government are aware of the efforts to keep Scarriff open. This must be on the basis of negotiations between the management, the banks, the receiver and the IDA. I hope the Minister will enter these negotiations and guarantee that if a package is arrived at the Department will supply the required amount of timber, in the region of 120,000 cubic metres. The Department must give a guaranteed contract of supply. I am quite sure the management will be able to prove their viability to both the receiver and the IDA on that one condition, that they will be supplied with the right amount of timber. Surely that is the only responsibility of the Minister.

An Leas-Cheann Comhairle

The Deputy's time is up.

Mr. Mac Giolla

The Minister has a responsibility to tell the House before the vote whether he is prepared to force his civil servants, against their will, to give such a package.

An Leas-Cheann Comhairle

Deputy Carey, you have five minutes.

Mr. Carey

As the second Fine Gael Deputy from the constituency of Clare I am very disappointed that the Opposition Party chose to put down this motion at this time. I appreciate that it is the job of the Opposition to take advantage of all the apparent weaknesses of the Government, but in this case political advantage is being sought by trying to embarrass the Government, the receiver and the banks so that Fianna Fáil will reap the benefit at some future date.

At one time I belonged to a company which lost 300 jobs. The most traumatic time for workers is when they are made redundant. The Opposition side do not seem to have any solution to the present problem except for whinging and crying and telling the Minister what he should and should not do. When I first met the directors of Scarriff — and they were appointed by the previous Government — they told me the company was insolvent and that the agreement drawn up in March 1981 was of such a drip-feed nature that it could not work. Evidence of that is seen in the transactions of that company.

Deputy O'Malley was boasting that he saved Chipboard in March 1981 and that he was glad to agree with the agreement brought in by the then Minister for Fisheries and Forestry. He was also glad to agree to appoint two directors, although he was Minister for Industry and Commerce and Deputy Power was Minister for Fisheries and Forestry. Deputy Power claimed, at column 462, of the debate on the State Guarantees Act, 1954, that he was responsible for appointing two directors and Deputy O'Malley appointed two others. The Deputy came in here and created a smoke screen but did not have any suggestions for saving the jobs in Scarriff, which is what every one has tried to do. Even Deputy Daly understands the difficulty. He knew from the beginning that the company were in difficulties. It was not until high noon that the then Taoiseach, Deputy Haughey, gave four minutes to the chairman of the company to discuss the future of Scarriff.

Prior to the election Deputy Haughey guranteed that he would see Scarriff secure. However, the then Minister, Deputy Daly, wrote in a letter on 14 December that they had only put aside a certain amount of money, they did not provide enough money to save the company. The directors came to this Government to see what solutions they had. I was shocked when I heard the Government had decided not to continue helping this company because I knew the workers had made a very good effort, they had increased productivity and the new management had made a very definite effort.

I do not like this rancour, this hatred, which is being built up over this case. Some of the things that have been said about the 50 people who invested in the company were deplorable, and all that was said for political ends. In my view Deputy Barrett and Deputy Daly, Deputy Taylor-Quinn and I could manage this job and provide work in Scarriff if we were left to ourselves instead of Deputy O'Malley——

(Interruptions.)

An Leas-Cheann Comhairle

Order, please.

Mr. Carey

I challenge Deputy O'Malley to say outside this House——

An Leas-Cheann Comhairle

Please conclude, Deputy.

Mr. Carey

He is looking for 37 or 38 Deputies to support him. That is all that is wrong with Deputy O'Malley——

(Interruptions.)

An Leas-Cheann Comhairle

Deputy Barrett to conclude.

Mr. Barrett

(Clare): I would like to clarify the position with regard to the agreement to give time to Deputy Carey and Deputy Taylor-Quinn. We were not approached before tonight. We were approached only by Deputy Mac Giolla and we readily agreed to give him time.

Mrs. Taylor-Quinn

It is the custom of the House.

Mr. Barrett

(Clare): This evening the Minister of State made wild accusations against Deputy O'Malley who was involved in getting Scarriff going again and saving 350 jobs. If the then Minister misled the private investors at that time, I want to tell the Minister of State that I also misled them because I was involved in every step of the negotiations. I can assure the House that neither Deputy O'Malley nor I ever asked a private investor for money. They volunteered it. We did not canvass. Is that clear?

Mr. D'Arcy

You misled them, which is more important.

Mr. Barrett

(Clare): The most noticeable thing about this Government amendment is that it says there will be the development of a chipboard industry but it does not say where. The word “Scarriff” is not mentioned, despite what Deputy Taylor-Quinn said this evening. Why is Scarriff not mentioned in the Government amendment? The reasons for shutting down this factory have not been explained. The reason put forward was that the Government were saving taxpayers' money. The amount of money sought was £3.5 million, not £6 million.

The Government now are talking about saving taxpayers' money and Government responsibility, but 12 or 18 months ago I put a Bill through this House for £25 million for Irish Steel Limited, who employ approximately 600 people, to pay their current debats for one year. We got complete agreement from the Opposition for that sum. It could not be said that that industry was viable, nor was Scarriff viable up to six months ago, but there was not a murmur from the then Opposition. Suddenly the cost of a dust burner, £3.5 million, has become a matter of conscience for the Government of the day. Let nobody be under any illusions: the Minister and his Government closed down Scarriff. I repeat that: the Government closed down Scarriff. There is no point in trying to hoodwink the people or mislead them, which was the word used by the Minister of State, into believing that the Bank of Ireland are responsible because they are not.

Mrs. Taylor-Quinn

It is the receiver who closed down the factory.

Mr. Barrett

(Clare): The Minister and his Government withdrew their support and the Bank of Ireland then put in a receiver. The bank were not owed any money because the Government guaranteed their money. I would like one point clarified: what discussion, if any, took place between the Minister or his officials and the Bank of Ireland before they decided to put in a receiver, and when had the Government decided to withdraw support from that factory? Some discussions must have taken place. The Minister put in the receiver and he should not try to hide behind the coattails of the receiver.

Mr. O'Toole

There were discussions week after week.

Mr. Barrett

(Clare): He is hiding behind the coattails of a receiver for whom he is responsible. There is no point in trying to mislead people by saying the receiver is the boss now.

Mr. O'Toole

He is the boss now, and the Deputy had better face that fact.

Mr. Barrett

(Clare): He is not the boss now. On more than one occasion I heard the Minister say the receiver has not requested it.

Mr. O'Toole

He has not requested it.

Mr. Carey

On a point of information——

Deputies

Sit down.

Mr. Barrett

(Clare): That is a very irresponsible attitude for this Minister to adopt. It is his duty to the 350 people employed in the factory, 200 inside and 150 outside, as the official owner of the raw material to make it available to the factory.

Mr. O'Toole

Any time I am asked for it I will make it available.

Mr. Barrett

(Clare): The receiver has to ask the Minister. He cannot make a decision on his own.

Mr. O'Toole

We are happy to stay within the law on this side of the House.

Mr. Barrett

(Clare): The Minister's own receiver——

Mr. O'Toole

He is not my receiver. The Deputy should get that into his head.

An Leas-Cheann Comhairle

Deputy Barrett without interruption.

Mr. Barrett

(Clare): The Minister is hiding behind the receiver.

Mrs. Taylor-Quinn

On a point of order, the Opposition speaker is not aware of the proper business procedure.

Deputies

Sit down.

An Leas-Cheann Comhairle

Deputy Barrett to continue.

Mr. Barrett

(Clare): What will really matter tonight is not the pious hopes expressed by Deputy Taylor-Quinn and Deputy Carey——

Mrs. Taylor-Quinn

Real hopes, not pious hopes.

Mr. Barrett

(Clare):—but what they will do when they climb those steps and turn right or left into the lobbies.

Mr. Carey

We believe in democracy.

An Leas-Cheann Comhairle

Deputy Carey, please.

Mr. Carey

We follow our leader.

Mr. Barrett

(Clare): A vote against this motion tonight is a vote for the continued closure of Scarriff Chipboard.

Mrs. Taylor-Quinn

No, it is not.

Mr. Barrett

(Clare): The decision by the Minister and the Government has made a mockery of job creation. Here we have an industry employing 350 people, apart from those employed in the service and ancillary industries. All the industry wanted at the start was £100,000 to buy a dust burner.

Mr. D'Arcy

Rubbish.

Mr. Barrett

(Clare): I will tell the Minister about rubbish. The Department acknowledged the fact that a dust burner would save the factory £300,000 a year. The Minister and the Minister of State said they did not seek to buy it. That is an incorrect statement, because the management sought permission to buy it without going to any bank, which the Minister prevented them for doing for anything other than cash flow or capital——

Mr. O'Toole

The Deputy had better get it right.

Mr. Barrett

(Clare): The Minister did that on more than one occasion. The management gave a clear indication that they could make their share of the £40,000 available from their cash flow.

Mr. O'Toole

You could not make a penny available for cash flow.

Mr. Molloy

That is not true.

Mr. O'Toole

It is true.

(Interruptions):

An Leas-Cheann Comhairle

Deputy Barrett without interruption.

Mr. Barrett

(Clare): Why did they not buy it? That is the question. I will tell the Minister — because State appointed directors on the board would not permit them to buy it. That is the position about the dust burner which would have enabled them to save £300,000 a year. That was making a mockery of job creation. They were looking for £3½ million: £1 million of that was to go towards the payment of loans, and £600,000 would have gone to the Revenue Commissioners. That left £2.1 million to save 350 jobs. This would have worked out at £6,000 per job, to preserve and maintain 350 permanent jobs.

Mr. O'Toole

The Deputy knows that is a simplistic argument.

Mr. Barrett

(Clare): If there is a murmur about a foreign industrialist the Government proclaim it to the high heavens. Under those circumstances what would new jobs cost the taxpayer — on average £15,000 per job, £8,000 of which is provided by the IDA. Make the comparison between £6,000 to preserve and maintain 350 permanent jobs and £15,000 for jobs which do not always materialise.

Mr. O'Toole

That is not so.

Mr. Barrett

(Clare): That is a fact. I defy the Minister to prove otherwise. I said the Minister made a mockery of job creation. He has also made a mockery of private investment. How could he expect the private sector to invest while he is in Government and when this joint venture of the private and public side, the Department of Forestry, has been put out of business by over 60 per cent ownership——

Mr. O'Toole

The Deputy has a short memory.

Mr. Barrett

(Clare): The Minister has pulled the plug on this industry. He is responsible for 350 people going on unemployment benefit or assistance. With the attitude of the liquidator at the moment——

Mrs. Taylor-Quinn

There is no liquidator.

Mr. Barrett

(Clare): I regret to have to say that liquidation is facing that industry now. That does not have to happen if the Minister is more positive and if, regardless of a request from the receiver, he makes certain that the raw materials in the form of thinnings are available to the factory tomorrow. That is step No. 1.

Mr. Carey

On a point of order——

Deputies

Sit down.

An Leas-Cheann Comhairle

Order. Deputy Barrett without interruption.

(Interruptions.)

An Leas-Cheann Comhairle

Deputy Barrett must be allowed to conclude without interruption.

Mr. Barrett

(Clare): The Minister must restore his support for this factory and for many other industries operating under a State guarantee. What can they now expect from the Minister and his Government when he pulled the plug? He pulled the guarantee from under them. Having closed the factory the Minister now tries to blame Deputy O'Malley — I was also involved — for opening the factory and providing 350 jobs nearly three years ago in Scarriff. Are we to be blamed for the fact that the Minister has closed it? He has reneged on Government responsibility to the people of Scarriff.

Mr. O'Toole

The Deputy is being irresponsible.

Mr. Barrett

(Clare): The wives, children and other dependents of those 350 workers will have a poor Christmas to look forward to. Suddenly the Minister's conscience has hit him. It should now hit him about Scarriff, east Clare, south Galway and north Tipperary. He should restore the guarantee and make sure the raw materials are available.

Question put: "That the amendment be made".

The Dáil divided: Tá, 77; Níl, 72.

Tá

• Allen, Bernard.
• Barnes, Monica.
• Barrett, Seán.
• Barry, Myra.
• Barry, Peter.
• Begley, Michael.
• Bermingham, Joe.
• Bruton, John.
• Bruton, Richard.
• Burke, Liam.
• Carey, Donal.
• Cluskey, Frank.
• Collins, Edward.
• Conlon, John F.
• Connaughton, Paul.
• Coogan, Fintan.
• Farrelly, John V.
• Fennell, Nuala.
• FitzGerald, Garret. Flaherty, Mary.
• Glenn, Alice.
• Griffin, Brendan.
• Harte, Patrick D.
• Hegarty, Paddy.
• Hussey, Gemma.
• Kavanagh, Liam.
• Keating, Michael.
• Kelly, John
• Kenny, Enda.
• L'Estrange, Gerry.
• McCartin, Joe.
• McGahon, Brendan
• McGinley, Dinny.
• McLoughlin, Frank.
• Manning, Maurice.
• Mitchell, Jim.
• Molony, David.
• Moynihan, Michael.
• Cooney, Patrick Mark.
• Cosgrave, Liam T.
• Cosgrave, Michael Joe.
• Coveney, Hugh.
• Creed, Donal.
• Crotty, Kieran.
• Crowley, Frank.
• D'Arcy, Michael.
• Deasy, Martin Austin.
• Desmond, Barry.
• Desmond, Eileen.
• Donnellan, John.
• Dowling, Dick.
• Doyle, Avril.
• Doyle, Joe.
• Dukes, Alan.
• Durkan, Bernard J.
• Enright, Thomas W.
• Naughten, Liam.
• Nealon, Ted.
• Noonan, Michael. (Limerick East).
• O'Brien, Fergus.
• O'Brien, Willie.
• O'Donnell, Tom.
• O'Keeffe, Jim
• O'Leary, Michael
• O'Sullivan, Toddy.
• O'Toole, Paddy.
• Owen, Nora.
• Pattison, Séamus
• Quinn, Ruairí.
• Ryan, John.
• Shatter, Alan
• Sheehan, Patrick Joseph.
• Skelly, Liam.
• Spring, Dick
• Taylor, Mervyn.
• Taylor-Quinn, Madeline.
• Timmins, Godfrey.

Níl

• Ahern, Bertie.
• Ahern, Michael.
• Andrews, David.
• Aylward, Liam.
• Barrett, Michael.
• Barrett, Sylvester.
• Brady, Gerard.
• Brady, Vincent.
• Brennan, Mattie.
• Brennan, Paudge.
• Brennan, Séamus.
• Briscoe, Ben.
• Browne, John.
• Burke, Raphael P.
• Byrne, Hugh.
• Byrne, Seán.
• Calleary, Seán.
• Collins, Gerard. Conaghan, Hugh.
• Connolly, Ger.
• Coughlan, Cathal Seán.
• Cowen, Bernard.
• Daly, Brendan.
• De Rossa, Proinsias.
• Fahey, Francis.
• Fahey, Jackie.
• Faulkner, Pádraig.
• Fitzgerald, Gene.
• Fitzgerald, Liam Joseph.
• Fitzsimons, Jim.
• Flynn, Pádraig.
• Gallagher, Pat Cope.
• Geoghegan-Quinn, Máire.
• Gregory-Independent, Tony.
• Harney, Mary.
• Haughey, Charles J.
• Hilliard, Colm.
• Kirk, Séamus.
• Kitt, Michael.
• Lemass, Eileen.
• Lenihan, Brian.
• Leonard, Jimmy.
• Leonard, Tom.
• Leyden, Terry.
• Lyons, Denis.
• McCarthy, Seán.
• McCreevy, Charlie.
• McEllistrim, Tom.
• Mac Giolla, Tomás.
• MacSharry, Ray.
• Molloy, Robert.
• Morley, P.J.
• Moynihan, Donal.
• Nolan, M.J.
• Noonan, Michael J.
• (Limerick West).
• O'Dea, William.
• O'Hanlon, Rory.
• O'Keeffe, Edmond.
• O'Kennedy, Michael.
• O'Leary, John.
• O'Malley, Desmond J.
• Ormonde, Donal.
• O'Rourke, Mary.
• Power, Paddy.
• Treacy, Noel.
• Tunney, Jim.
• Wallace, Dan.
• Walsh, Joe.
• Walsh, Seán.
• Wilson, John P.
• Woods, Michael.
• Wyse, Pearse.

Tellers: Tá, Deputies Barrett (Dún Laoghaire) and Taylor; Níl, Deputies B. Ahern and V. Brady.

Question declared carried.

Motion, as amended, agreed to.