Deputies Seán Treacy and Donal Ormonde have been given permission to put questions to the Minister for Industry, Trade, Commerce and Tourism on Private Notice. As both questions are on the same topic, I take it that both are being answered together. I would ask both Deputies to read their questions, Deputy Treacy first.
Private Notice Questions. - Irish Leathers Group.
I wish to ask the Minister for Industry, Trade, Commerce and Tourism if he is aware of the imminent closure of the tanneries at Carrick-on-Suir, Portlaw, Dungarvan and other centres with a loss of some 400 jobs; if he will take all possible steps open to him and the relevant agencies under his control to avert the virtual destruction of the Irish tanning and leather industry, which is bound to have catastrophic effects on the communities involved; and if he will make a statement on the matter.
I wish to ask the Minister for Industry, Trade, Commerce and Tourism the steps he intends to take to ensure that the placing of a receiver into Irish Leathers by Fóir Teoranta will not result in job losses in this industry so vital to Waterford and the south-east.
I propose to take these two questions together.
I have been monitoring the situation in the Irish Leathers Group very closely for some time. Very considerable efforts have been made by the relevant State agencies to support the industry.
Despite the remedial action taken, however, the group's continuing losses have proved unsustainable, and Fóir Teoranta, who have provided substantial financial support over a number of years, yesterday appointed a receiver-manager.
The receiver-manager has been requested by Fóir Teoranta to make every effort to dispose of the businesses as going concerns. I have asked the State agencies to provide all the further assistance they can towards maintaining the Irish Leather plants and saving as many jobs as possible.
I make a heartfelt plea to the Minister of State to keep the plants in question open and retain the workforce pending the outcome of the negotiations with the receiver-manager. Will he state what representations or proposals were made to him by the management of Irish Leathers Limited for the continuation of operations? If such proposals were made to him or to any of the agencies under the auspices of his Department, will he state why such proposals were seemingly rejected?
It is my understanding that the receiver has indicated that he is examining the operations of the group and that he intends to continue trading in the expectation that the group will be sold on an ongoing business basis. Regarding representations by the company, probably these would have been made to Fóir Teoranta, an independent body under the aegis of the Minister for Finance. Members of the House will appreciate that Fóir Teoranta have invested substantial sums as well as taking preference shares and giving guarantees which, I understand, were in the region of £10 million in total. There is a very heavy involvement by Fóir Teoranta in this case. I understand that the prospect of the group making very heavy losses this year was very real. The ongoing loss making was the basic reason a receiver was appointed.
The Chair would like to make it clear that he had some doubt about allowing these questions because a receiver has been appointed. It is in order to discuss whatever happened prior to the appointment of a receiver but what the receiver is doing or should do is a matter between him and the court.
I wish to give notice that I wish to raise this matter on the Adjournment.
The Chair will communicate with the Deputy.
Will the Minister of State now concede that the final straw for the leather industry was the VAT increase of 10 per cent which was introduced by the Government in the budget? We have already suffered the loss of 370 jobs in Clark's factory in County Louth as a result. This is a direct spin-off of that closure.
This group is of strategic importance being the last shoe leather tannery group in the country. In relation to the question of VAT, nearly all of the output of the group would be for export and, therefore, the question of VAT does not arise. It would be recouped by the group.
Is the Minister aware that the bulk of native hides is being exported at the moment without processing? Further, is he aware that Portlaw tannery is the most efficient finishing plant in Europe? In view of these facts, is he not prepared to reconsider the matter and to rectify the situation?
I am afraid the matter is outside my control. The receiver was appointed by Fóir Teoranta on the grounds that the company, however efficient it may have been, was continuing to make serious losses. The receiver has been appointed and he is accountable to the court.
The Minister knows as well as I that the tannery is the only source of employment in the town of Portlaw. Can he ensure that in whatever restructuring is carried out there will be a viable undertaking in Portlaw? Otherwise, it will be converted into a ghost town overnight.
The Deputy can be assured that I am well aware of the industrial situation in Portlaw. I am also concerned with the industrial situation and the employment problems of Dungarvan, Carrick-on-Suir and Carlow. He need not tell me about matters in my own constituency.
The Minister's record would suggest otherwise.
I understand that the investment of Fóir Teoranta in this case was the highest they ever made.
It was £2.4 million, not the £10 million the Minister suggested.
Is the Deputy suggesting I am misinforming the House?
The figure I have is £2.4 million.
Perhaps when the Deputy is a Minister he may appreciate the figures I have mentioned. I am deeply concerned about the towns that may be affected by this receivership——
As the Minister was about Clover Meats.
I am confident that the efforts of the receiver to sell the company on an ongoing trading basis will be successful. I have made my views known to the IDA and I have asked them to examine the industrial situation in the towns concerned.
Will the Minister of State and the Government now concede in view of the latest situation and the loss of 800 jobs in Clover Meats earlier than year that they show a total lack of commitment to employment in general and to Waterford and the south east in particular?
That is not a question; it is argument.
It is a fact.
The receiver was appointed by Fóir Teoranta. They invested loans, took preference shares and gave guarantees to an extraordinary extent. They showed great support for what they recognised to be a strategic industry. Unfortunately in the past few years the company incurred serious losses and this continued into 1985. The losses incurred for 1984 were quite considerable. That is the reason the receiver was appointed. This Government are dedicated to re-establishing the environment for industrial prosperity which was wrecked by Fianna Fáil from 1977 to 1981 and in 1982——
Tell that to the workers in Clover Meats.
The Government will deal with the economy in a responsible manner, unlike Fianna Fáil.
On a point of order, so that we may understand the terms of this debate, what does the Minister mean by "dedicated to re-establishing industrial prosperity"? The facts are not in accordance with that commitment.
May I correct Deputy O'Kennedy? He is under a misapprehension: it is not a debate.
I was trying to understand what the Minister of State was saying.
Deputy Geoghegan-Quinn wants to raise a matter.
(Interruptions.)
I wish to raise this matter on the Adjournment.
I will communicatre with the Deputy.
Deputy O'Kennedy was one of the Ministers responsible for doing great damage to our industrial development and to our economy.
(Interruptions.)
Bhí díomá orm nár ghlac tú le mo cheist phráinneach tamall ó shin. Cé go nglacaim le do rialú, creidim go bhfuil práinn faoi leith ag baint le príosúnú dhuine de bharr nár íoc sé a tháille ceadúnais teilifíse go háirithe nuair a smaoiníonn tú go bhfuil go leor príosú-nach a rinne coireanna uafásacha i bhfad níos measa atá á scaoileadh saor tar éis cúpla lá. While I accept your permission, the wish to raise, with your permission, the subject matter of the disallowed Private Notice Question on the Adjournment and to ask the Minister for Justice if he will use his discretionary powers to effect the release of the prisoner immediately.
Ní raibh an cheist in ord do fhreagra phríobháideach. Regarding the Deputy's request to raise the matter on the Adjournment I will communicate with the Deputy.
I support my two colleagues, Deputies Treacy and Ormonde.
We have moved on from that matter.
I appeal to the Chair to allow it to be raised on the Adjournment.
A number of important items have been raised and I will consider them all carefully.