National Development Corporation Bill, 1985: Second Stage (Resumed).

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

Mr. O'Donnell

Before I reported progress I was referring to the possibility of the NDC intervening in the small industries development programme. There is enormous scope for the corporation in the development and promotion of small industries. It is now recognised here and in the EC that small industries have a vital role to play in economic development and job creation. In the mid-west region, because of the special attention given to small industries by SFADCo, there has been a remarkable growth in the number of such concerns. Many facilities are available to small industries such as feasibility grants and grants for equipment, buildings and so on. However, two major problems confront such industries, a cash or working capital problem and the problem of export marketing.

I hope the NDC, which will be able to invest in large and small industries by way of joint venture or otherwise, will be in a position to contribute in a practical way to help to overcome the two major problems I referred to. I regard the Bill as the most important piece of legislation introduced in the House for many years. The proposal to establish the NDC is a positive, realistic, practical and feasible response to the growing cancer of unemployment. The daunting challenge of tackling that problem, particularly in a recession, makes the introduction of new strategies and development agencies of vital importance.

I should like to refute suggestions by Opposition speakers that the NDC will duplicate the functions of organisations like the IDA, SFADCo, CTT and, perhaps, Údarás na Gaeltachta. I do not see how that argument can stand up to examination. The IDA cannot provide working capital, participate or take equity in companies except in exceptional cases. It has been difficult in recent years to attract foreign industries because of the world recession. Countries are not investing abroad with the result that the job of the IDA has become very difficult. I see a possibility, under the terms of reference applying to the NDC, for an acceleration of foreign investment here. It will now be possible for a foreign investor to participate with the State in the organisation and promotion of industrial projects. I am sure foreign investors will be pleased to know that, through the NDC, they will be able to invest in a project with the State.

There is also the possibility of the NDC intervening in agriculture, food processing and the development of an Irish timber industry. There is no doubt that agriculture is our greatest natural resource and there is immense scope for the development of a modern food processing industry. One of the big problems in national development since the foundation of the State is that we have never succeeded in formulating and implementing realistic long term plans for the agricultural industry or established along side it a good food processing industry. There is scope for intervention by the NDC in that regard. The fact that we have not been able to develop the food processing industry to its full potential is an indication that State development agencies have been either unable or unwilling to get involved to the optimum degree.

There is immense scope for vastly increased exports of high quality food products, particularly to the continent of Europe. I have the greatest admiration for the IDA and SFADCo and recognise, as everybody must, the tremendous contribution these organisations have made to the development of industry, to job creation and to the attraction of foreign investment to this country. That is recognised, understood and appreciated by all. However, in the present situation, with the difficulties of attracting foreign investment to the same degree as in the sixties and seventies, some new strategy is necessary, the release of a new dynamic. The National Development Corporation have the possibility and potential to spark off a completely new approach to development and to job creation. In the establishment of this corporation everything will depend on the calibre, experience and capacity of the chairman, board members and chief executive. This has been adverted to by other speakers. I would appeal to the Government to ensure that the best possible people are recruited to those positions.

Another area with enormous scope for intervention by the corporation is in the field of research and development. It could give practical encouragement to a liaison between universities and research institutes in industrial development. There is a good example of this in the western region with the National Institute for Higher Education and the new technological park established in Plassey on the NIHE campus. They have there an innovation centre and an enterprise centre and now this technological park. There is continuous interaction and interrelationship between the academic staff of the NIHE, SFADCo the IDA and industrial development and job creation agencies in the region. It is clear that there is fantastic scope here. We have very good research workers in all our universities and an outstanding internationally recognised agricultural research institute, but I have long been worried that these research services, which can be called pure research — perhaps in the field of chemistry, agriculture, engineering, electronics and so forth — are applied only in very small proportion in a practical way to the creation of industry and the making of jobs. There is a need for some agency to act as a promoter or catalyst between the research institutes and universities and the commercial application of research.

There are two areas in which the corporation could intervene in a very practical way to the benefit of the country. The first is in the development of the fishing industry and the second in relation to afforestation and the establishment of a proper timber industry here. I am delighted that this legislation has been brought before the Dáil. I have great hopes that the establishment of this corporation will give new confidence to the over 200,000 unemployed people, particularly the young people leaving third level educational institutions and AnCO centres highly qualified and skilled and with enormous potential. I hope the corporation will open up a new era of economic development and job promotion. I congratulate the Minister very sincerely on introducing this Bill and trust that the hopes placed in it will be fulfilled and that it will be established very soon.

Mr. Lenihan

The National Development Corporation Bill is paraded before this House as legislation designed to deal with the economic problems of the country, particularly those of unemployment and lack of investment. These are both interrelated. It is essential to raise the level of private and public investment, thereby creating opportunities for employment which will remedy in some respect the basic unemployment problem affecting this country socially and economically at present.

Viewed in that context, I question that this Bill is any answer to that basic and fundamental problem. The creation of a bureaucratic corporation of this kind on top of the existing semi-State bodies and organisations is not a getting to grips with the unemployment problem. It is merely creating yet another bureaucratic organisation on top of those already geared and mandated, under the legislation establishing them, to deal with the problems of investment, of joint venture participation, of co-operation with other State bodies or with the private sector in development and investment. That is spelt out in the Bill itself because under the First and Second Schedules there is a list of all the State-sponsored bodies on whom the National Development Corporation will rely to carry out the investment about which I am talking.

We have the example of Aer Lingus. They are already engaged in areas of expansion and will have further areas for expansion in which they can participate without any National Development Corporation or administrative apparatus of this kind. They have already diversified successfully into hotel development, aircraft leasing, training programmes, repair and maintenance operations. There is a whole range of aviation and hotel related activities in which Aer Lingus are already involved — substantially and successfully involved. They do not require any administrative apparatus to supervise what they are doing or not doing. They have the expertise, the financial, production and marketing experience to carry out that sort of work. It is complete duplication to establish an elaborate structure such as the corporation proposed in this legislation while Aer Lingus are there. If the State wants Aer Lingus to intensify existing activities or to go into the kind of developments I have mentioned, the State can make further equity capital available to Aer Lingus to carry out these operations. Alternatively, Aer Lingus can enter into any joint venture arrangement they may wish or participate with other airlines in areas of expansion which would give more employment. All these possibilities already exist under the legislation establishing Aer Lingus. All that is necessary is the political will on the part of the Government to give Aer Lingus financial and governmental backing to proceed in these directions.

The same goes for every one of the organisations mentioned in the Schedule to this Bill. Each of them could go ahead at the moment without the need of a further layer of bureaucracy on top of them, meddling in their affairs and causing a further impediment to development.

Bord Gáis Éireann are mentioned in the Schedule. This organisation, given the proper mandate in terms of financial backing and political will, can develop further into Limerick, Galway and towards the north and north-west. Progress in that area has been too slow. It requires political direction and will not be improved in any way by putting a national development corporation between the Minister and BGE.

Bord Telecom are now moving into areas of expansion, and other possibilities will present themselves if political will is exercised by the Minister. Sometimes that political will is exercised in a negative way and I would ask what the Government propose the NDC could do to improve the situation of the B & I line. They require positive help and no amount of NDCs or bureaucracy will improve the performance of the B & I and rationalise and expand their activities but rather will constrict their activities.

Irish Life Assurance Company is one of the dynamic growth companies. They have established a building society and are proceeding not only into insurance development but into the development of housing and property. They do not require a development corporation to impede rather than facilitate progress.

When one reads through this list one sees excellent semi-State bodies already in existence who have the legislative mandate to expand. All they require is political will on the part of the Minister and the Government and the necessary financial backing to enable them to implement proposals envisaged by them to ensure further expansion, investment and consequent employment.

Bord na Móna are also mentioned. In what way will the National Development Corporation facilitate Bord na Móna, who have been doing an excellent job in regard to turf cutting and supplying turf burning power stations? Their expansion into milled peat and the treatment of reclaimed bog are very advanced and a lesson to the world as a whole. We would envisage further investment and expansion into the area of forestry development, the transfer of the activities of the forestry division of the Department to Bord na Móna, who would be given a fresh mandate to engage in the commercial development and exploitation of our forestry and timber resources as well as the development of our peat resources. The two go hand in hand and we would see further downstream ancillary activities taking place under the guidance of a single State-sponsored body. What function would the NDC perform in that context? All that is required is a mandate from the Minister and a change in legislation to add forestry development to peat development as part of Bord na Móna's operation and, if necessary, the financial support to enable them to get on with the job.

In all these State-sponsored bodies we have the structure, the expertise and the resources to allow for further expansion, provided there is political will and financial backing by the State. It can all be done under the existing semi-State companies.

The ESB have successfully diversified their activities. In Africa and the Middle East they have undertaken consultancy contracts relating to the construction of transmission and power station facilities. They have done this from their own resources and much more could be done if the Government had the will to provide the ESB with the finance to expand in these directions.

One can see the scope for expansion when reading through this list of State-sponsored bodies. Bord Fáilte could expand in the tourism field; CTT could expand in the export area; Kilkenny Design Workshops could expand in the specialised area of design; the National Board for Science and Technology could expand advanced research into technology; SFADCo have great expertise in regard to industrial development on a regional basis. There is enormous scope for expansion and development. One is struck by the paradox of a Government who have the temerity to bring in this legislation, pretending to deal with development and expansion, while at the same time they are presiding over the liquidation of Irish Shipping and the quasiliquidation of B & I. In regard to both these companies the Government are taking an entirely negative, restrictive and reactionary approach.

Coming back more directly to the mandate proposed in this legislation, is there anything in it that could not be done by the NEA, the IDA or the ICC, who are already engaged in this business? They are all concerned precisely with investment on behalf of the State, joint venture investment or private investment. I suggest that the proposal to establish this body is no more than an elaborate piece of window dressing because the State companies are already there, the apparatus is there, and all that is proposed here under the guise of further progress and development is another bureaucratic animal to supervise the State companies already there and to wind up one of them, the NEA.

We do not want this new bureaucratic animal to graze on the State companies already there. The existing State companies can do this work. The British invented the term "quango" but the British have been dismantling them as have countries all over the world. I am all for State enterprise provided it is channelled into productive areas, provided it is properly financed and given a mandate to do the work and to proceed under the overall political direction of the Minister and the Government. Here, however, we have a Government running away from their responsibilities and establishing another bureaucratic monster to meddle and intervene between the Minister and the other semi-State bodies who are fully equipped to do the work. This legislation is nothing more than window dressing to try to get the people to believe that something miraculous will happen.

Nothing will happen without political will and finance. The political will can be exercised and the financial resources made available through a whole range of State-sponsored bodies already in existence. Progress merely requires the Minister to sit down with the chairmen of these bodies and their boards, and ask them where we can go, where do we stand, what new ideas are emerging, what new activities do these State bodies require investment for.

The IDA have been doing an excellent job attracting industry here, arranging that companies would come together. What kind of relations will be established between this new animal and the IDA? Why are the NEA being wound up and replaced? Is it not quite clear that this is just political stunt making or window dressing, whichever you like to call it? A new bureaucratic structure is being established which will not contribute one whit towards development and expansion. It will just be a further layer of bureaucracy frustrating activity by the existing semi-State bodies. This work could be done by more co-operation between the Minister and those bodies. If difficulties should arise, a special State body could be set up to deal with them. For instance, if there is a problem in relation to forestry development or downstream timber activities, Bord na Móna are ideally geared to take on that problem. The law could be amended to give them an extra mandate and extra finance for that purpose. Alternatively, a State body could be set up to deal precisely with forest development and the development of timber products.

To set up this vague elaborate structure which, given time, will turn into a magnificent white elephant is an extraordinary action by any Government. Of course it will not get time because before this legislation has been enacted there will be a change of Government and this legislation and any animal or quango that may incipiently emerge from it will be consigned promptly to the wastepaper basket by the incoming Fianna Fáil Government. We will set about getting the existing State bodies to carry out enterprises more efficiently, or establish further State bodies if there is a vacuum and a need.

That is the way to go about business, and I am sure that is the view of Deputies John Bruton and E. Collins, if they were to stand here and speak openly, if they did not have the albatross of the Labour Party around their necks. Just because this quango was proposed in the Labour Party policy before the establishment of this Government, the Fine Gael Ministers are hung with it. Those Ministers agree fully with what I am saying — one of them is sitting opposite me — but they are hung with this Labour albatross and have to go along with this parliamentary charade in order to keep the Labour Party boys quiet for another few months.

Bringing everything down to bedrock, that is what this Bill is all about. It is in aid of keeping the Labour boys happy for a few more months. Deputies John Bruton and Dukes and Eddie Collins fought a fight for sanity, and for three years they frustrated and prevented the Labour Party from getting their way. They were right to do that, but they were wrong finally in succumbing, which they did because of political opportunism and expediency in satisfying the junior partner. That is why we are wasting time here talking about this Bill.

That is my general approach. There is not much need to go into detail on the weaknesses of the Bill. The whole Bill has been wrongly conceived and will remain stillborn because we will be the next Government. That is why the Bill or any fledgling administration brought into life during the brief period while it is law, before we are the Government, will be consigned to the wastepaper bin.

As we are engaged in a parliamentary exercise, there are certain aspects of the Bill that show it for the complete nonsense it is even were it concerned with the sort of magnificent drive for expansion, development and investment in jobs that the Labour Party would like to trumpet about. I might ask the Labour Party in particular, as the junior partner in Government, to look at section 15 (1) where there is contained a more restrictive clause than any obtaining in regard to any State body really doing their work. Here I am thinking in particular of the IDA. Under that subsection no more than £1 million can be expended by this quango without seeking the approval of the Minister. They are completely hamstrung from the beginning. I will read the subsection to illustrate my point:

Subject to subsection (2) and subsection (3), the Corporation shall not, without the prior permission of the Minister, invest in an enterprise an amount or amounts exceeding in the aggregate £1,000,000.

Therefore, the corporation ab initio is limited to not spending more than £1 million without approval of the Minister, who must then refer to the Minister for Finance, who will bring it before the Government, who will strangle any such project at birth. That is not the way the IDA are run. Rightly the IDA have always had an open mandate to carry out their developments. Likewise, Aer Lingus have a similar open mandate, as have all of the major State companies, such as the ESB, over the years. This corporation, which will supervise the whole lot of them, organise them all into joint ventures and new proposals, cannot make a move if any such major development exceeds £1 million. Do the Government realise the age in which we live and the pretentiousness of this Bill? If this Bill is what it pretends to be, it is a total contradiction in terms if the corporation is not allowed to spend or invest any more than £1 million without approval of the Minister and, in turn, the Minister for Finance and the Government. We are right back into the maw of bureaucracy once more, the whole purpose of what is intended being frustrated.

I am now making points that presume to some degree that this Bill is seriously intended, seriously meant to be what it states, when it is not. Probably I am going through details here that will not matter a whit because the Bill will never be effective or achieve anything. When the Government were pretending to throw a sop to the Labour Party, pretending to introduce a Bill that might be of some consequence, at least they might have continued the pretence and given an open financial mandate to such a body to get on with the job, implementing the whole range of tasks set out in section 10 which contain two pages of magnificent objectives of the corporation, all of which are already being achieved by existing State sponsored companies.

Two-and-a-half pages of that section are devoted to reiterating those aims and objectives, giving this new corporation objectives and aims already written into the mandates of existing State bodies established by legislation in this House. There are two-and-a-half pages of glorious prose which, if read in isolation, might lead one to believe there was some serious intent behind the establishment of this corporation until one reaches section 15 (1), under whose provisions one sees they cannot make a move if any such project is in excess of £1 million, when they must seek Ministerial approval and so on — back to be buried by the Civil Service establishment. That is that, as far as the Labour Party are concerned.

There is little else to be said about the Bill. Indeed, both the Bill and its Explanatory Memorandum revolve around the two sections I have mentioned, one dealing with its objectives and the other with its financial limitations. Other than that it amounts to an administrative, bureaucratic exercise, purporting to establish a new bureaucratic body that will prove to be doubly frustrating. It will prove frustrating to existing State-sponsored bodies who want to go ahead, get on with the job and who will discover this body meddling in their affairs. It will be frustrating to the Minister concerned because this body will be sandwiched between himself and the State-sponsored bodies for which he is responsible. Indeed, it will amount to a further frustration of the existing bureaucracy which will have yet another layer to deal with between the Minister and the existing State companies with whom they have to deal.

What this Bill proposes is a bureaucratic mess for which there is no practical, financial or economic reason. It is a bureaucratic mess designed purely to meet certain political imperatives caused by the desire of the senior party in the Coalition to keep the junior party in Coalition quiet. That is just not good enough after three years in Government. We have a number of excellent State-sponsored bodies. I might avail of this opportunity to pay tribute to them, many of whom engaged in forms of diversification and investment to date that have been highly successful. These were State-sponsored bodies in the main established by Fianna Fáil Governments, that have worked excellently. I was associated with one in particular, Aer Lingus, when as Minister for Transport they expanded into a whole range of areas related to aviation but not concerned with direct flying, all of which have been very successful — operations concerned with repair, maintenance of planes, the leasing of planes, hotel development, and so on. That type of initiative has been shown by other State sponsored companies over the years.

However, the Government have sought to diminish the role of State-sponsored companies. Born na Móna have also done a magnificent job and there is scope for further development and activity on their part. You can go right through the whole list and see that there is enormous scope for development, provided there is political will and finance is made available to do so. The only response by the Government is to propose legislation to set up this body but — and I will be proved right in two years' time — it will never be a viable operation. It is stupid and futile in the extreme mainly because it is being set up for all the wrong reasons.

Existing machinery can carry out the job which is required and the Industrial Credit Company, the Industrial Development Authority and the National Enterprise Agency already do this job. The facilities and agencies are there and, although this legislation may be passed, the National Development Corporation will never get off the ground. If by any chance it did, we will ensure that it will go down when we are in Government again. We will be a Government who place their confidence in the State-sponsored companies like the B & I and others which have been established to do specific jobs. We will ensure that these companies will be restored to health and properly managed and we will rid the economy of any bureaucratic excrescence which may develop as a result of this legislation.

Mrs. Barnes

I welcome this initiative and I see it as part of several which are needed. We have never exploited our full resources although we hope that the potential is still there. We never established the necessary industrial base and I see this initiative as encouragement and a generator of jobs which we all know is the greatest problem facing us.

For too long people have been encouraged to think that jobs will be provided, but we did not give them the resources to allow them to create jobs. The emphasis was always on the provision of jobs and a perception that the Government would, in some miraculous way, provide employment. We did not give our young people training or encourage them to use their initiative and skills. The whole emphasis in our education system should be to teach our young people self reliance. We were led to believe that our young people should expect things to happen rather than to accomplish them. One of the problems facing us is the idea that all we had to do was to try to get a job and hold on to it for life. We know that that passive or easy option is not available any more.

I worry about the type of education provided and the way in which we judge success within the school system, particularly on gaining entry to third level education. Students are forced into working in a personal and competitive way, not for the good of a group. They are not encouraged to work within a group which is essential from the point of view of sharing skills and talents, to work together to set up industries and job creating centres. It is only by encouraging such type of sharing that we will create jobs which are so badly needed.

Instead of working on the points system and judging people as being individually successful at 17 or 18 years of age where they are regarded as creators or water carriers, the success of students should be based on how much they contributed to a group, to the team work within the class. If we are talking about initiatives and sharing of skills which are essential to job creation, that is where we must start. I see nothing ideologically alien about the introduction of the NDC and I cannot understand why some Opposition Members are jumping up and down as if some type of strange——

Mr. Doherty

Monster.

Mrs. Barnes

Deputy Lenihan made constant reference to the fact that much of the job creation has been as a result of setting up State agencies accountable to the Government which encouraged what private industry was not able or willing to do. That is why I cannot understand why the National Development Corporation are seen as some strange animal which has not yet reached Ireland. A tremendous number of jobs — and this is the way it should be — are a mixture of private and public enterprise.

As I listened to Deputy Lenihan and some other Members, I was reminded that exactly the same arguments were made with regard to other organisations which were set up 20 years ago. They were described as white elephants, bureaucratic muddles and it was said that they were coming between private investors and individual rights. Now that they are successful they are recorded as such. Deputy Lenihan hoped that he and his Government will be able to consign the NDC to the wastepaper basket but I think the Corporation will flourish in the future. It is my opinion that in years to come they will be regarded as a success.

However, I have certain reservations that the NDC may not be as flexible as we would wish. I am glad that the corporation will be able to offer venture capital in certain areas where money will not be available from private sources. If we could rely totally on private enterprise it would not be necessary to set up the National Development Corporation. However, private industry does not think it has any social obligation to create jobs.

The National Development Corporation will add to the excellent work already being done by the National Enterprise Agency. I hope the corporation will not just concentrate on high-tech jobs which are essential if we are to keep abreast of what is happening throughout the world and if we are to remain competitive; I hope they will also deal with what might be called low-tech industries that are labour-intensive. Those of us who are constructive in our comments about the NDC welcome the fact that the corporation will concentrate on our natural resources. They will be able to offer encouragement, investment and loans which are necessary to exploit fully those resources. Other speakers spoke about tapping the potential in downstream agriculture and our forestry resources and I shall not deal with those matters.

Section 10 (1) (f) states that the corporation shall:

invest in any enterprise involved in the exploitation, development, production or marketing of natural resources...

We cannot over-emphasise the importance of marketing. There has been a tendency here to start production without carrying out the necessary research on marketing and on transportation problems. Marketing must be a first priority and I am glad that this matter has been dealt with in the Bill.

Section 10 (1) (i) states that the objective of the Corporation shall be:

to establish, promote, assist (financially or otherwise) any enterprise engaged in the exploitation of research...

Will the Minister state if it will be possible for research to be initiated by the NDC? Will they be able to set up their own research units? We are in a time of rapidly changing technology and we will need to put tremendous emphasis on and investment into research.

I welcome the provision regarding accountability. Deputy Lenihan said that we are merely adding another layer of bureaucracy. All of us want the taxpayers' money and the European funding to be used as efficiently as possible. Therefore, it is important that legislators ensure there is due accountability. It is our job as legislators to have the right conditions for investment and job creation. We have also to ensure that an account can be given of the money invested or loaned. There is a perception among the public that often we have thrown good money after bad and many people believe that if there was more stringent accountability money could be channelled into more productive areas. I reject Deputy Lenihan's suggestion that what we are proposing is just another layer of bureaucracy.

With regard to the setting up of the board of directors, I am glad that the section in question refers to men and women with entrepreneurial skills. I hope that when the board is appointed it will have people with the highest level of skills and expertise but I also want to have on the board women with those skills. In the United States in the past few years many jobs, particularly those generated through small businesses, have been initiated by women. They have achieved this against tremendous odds. Inevitably women are not taken as seriously in business as are men. In Ireland the trend has been the same in the past few years. Many women have started work in their own kitchen or in their backyard using their skills and services. There have been large attendances by women at seminars dealing with small businesses and it is obvious that there is a great need for guidance and advice. I ask that the NDC give every encouragement and support to women. I hope they will set a record of which we can be proud.

Again and again Members of this House have spoken about forestry, and I am very pleased it has been mentioned in this debate. The Minister of State, Deputy O'Keeffe, speaking on the last Bill pointed out that, while we do not have a common forestry policy in the EC, we have many opportunities to take advantage of the fact that less than 50 per cent of the Community are self-sufficient in forestry. There is a lot of grant funding available from Europe for fast timber growing, for which the land of Ireland is particularly suitable. We cannot over-emphasise the need to invest in this area. Unfortunately, we do not appear to have attracted private investment into afforestation, especially when the Minister tells us as little as 5 per cent of our land is under afforestation compared with 22 per cent in the rest of Europe. This shows that there is great potential in this field.

I also welcome the emphasis by the Minister on worker participation and worker shareholding. I would like to think that the National Development corporation will provide initiatives and bonouses to encourage worker participation and worker shareholding. Countries like Sweden who have similar corporations have been very successful because they have provided such incentives. The Minister said, and rightly so, that he did not wish the National Development Corporation to function as a means of resolving the difficulties of ailing State or private sector industries. The NDC should provide vibrant and creative opportunities and the bottom line should always be to provide jobs.

In my view some of the sections in this Bill are too restrictive, for instance, the fact that long term investments should not exceed 30 per cent, or that not more than one loan may be granted to a company or firm. Could the latter not be counterproductive where a company, which was set up to produce one product and was very successful, may wish to branch into another area for which they would need a certain amount of investment to get off the ground? Does this section mean that because that firm got one loan they will not be given a second loan, even though they are offering a viable proposition? It is important that this point be cleared up. It is also mentioned that a lease on office premises should not exceed £250,000. Does that refer to a long term lease? For instance, if it was for a 35-year lease on office premises that would mean it would cost £7,500 per annum, which would be an extraordinarily low sum. I may have misunderstood this so perhaps the Minister would like to clear up this point.

There is a section dealing with disclosure of interest by directors. Everybody sees the necessity for this section, particularly with regard to accountability. Section 26 says that a person who contravenes subsection (1), who does not disclose an interest, particularly a vested interest, in any of the areas in which the NDC might be dealing, "shall be guilty of an offence and shall be liable on summary conviction to a fine not exceeding £800". Because it would not be profitable to disclose one's interest in certain cases, does the Minister consider that the fine is high enough in today's terms? That kind of advantage could mean a profit of hundreds of thousands of pounds. We should consider whether it might not be worth the risk to be fined £800 in order to gain far greater advantage.

The National Development Corporation should generate a feeling of confidence and encourage entrepreneurs. When a firm have a good idea and want to expand, they should be able to do so even though the banks may not be interested in providing venture capital because here we have a corporation set up primarily to deal with this problem.

I welcome the discussion on another natural asset — tourism. Changing circumstances are affecting Ireland even at European level. Our farmers should be encouraged to diversify. I have already mentioned forestry, but tourism should be recognised as one of our greatest revenue earners. The time is coming when people will have longer holidays and more leisure hours. This means tourism will become more and more important and the servicing of tourism will be more competitive. This is an area where Ireland must not slip behind.

People involved in tourism lay great emphasis on the fact that the National Development Corporation could help them to build a tourism infrastructure. They are talking not only about grants for expanding hotel and leisure facilities but about roads infrastructure to make travel easier and more attractive and about the provision of clean, hygienic, well serviced camping sites to cater for our young population and young tourists who visit here without much spending money. We have done little or nothing in relation to providing such facilities although we have the greatest environmental assets for such a project. The NDC could contribute in that area.

It could be argued that camping sites and students travelling cheaply around Ireland or Europe do not contribute much to the economy. That is so in the short term but, for the long term, we would establish standards and an image of this country that would attract those students back when they had more money to spend. We could make this area a principal source of revenue. I am glad this has been highlighted in the NDC Bill. I hope all the people in tourism, through investment, will be able to build on that.

I look forward to the day when people, recalling the setting up of the NDC, will remember the criticisms levelled at this Bill and the lack of confidence shown by the Opposition, and see that the criticisms have been totally refuted and that we have set up something that will accomplish what we all wish to accomplish, the generation of jobs and a climate that will encourage people with skills and initiatives to create jobs.

Mr. Doherty

The proposed Bill is no more than the Labour Party tail wagging the Fine Gael dog at the expense of the taxpayer and the economic future of the country. This Bill has been introduced for blatant political purposes and account has not been taken of the important issues which the Government should be addressing.

The money to be invested by the NDC, it appears, will be regarded as grant aid. Their function is a duplication of the function of existing State agencies. Several of them have done similar work very successfully. A normal investment company would have share capital, bank borrowings and would have to attain profits. On that basis it would have to make a profit, repay the bank and pay dividends. None of these criteria will apply to the NDC when constituted, as they will be prohibited effectively from borrowing. The Government will supply all the finance, run all the expenses, will fail to secure dividends and will end up making regular injections of capital into the corporation.

It is not clear how much money will be put in by the NDC when constituted or how further funds will be obtained. Will the directors have to make a presentation to the Minister each time they get an investment or will they have an annual investment fund? These questions must be answered. A director of the corporation will want to know what return the corporation will want. Will they insist on appointing directors to companies in which the corporation invest? What are the investment priorities of the corporation? There are no clear objectives in the Bill or criteria that could be complied with requiring a certain direction by the corporation when set up.

Several State agencies will be in direct conflict with this corporation, the main ones being CTT and the IDA. Private investment funds like the development capital corporation and new tax free funds can be invested in, up to £25,000 by individuals. This corporation will only add further confusion to an already confused situation. What we need to do is to generate confidence in investment, in productive industry either replacing imports or processing agricultural produce at home. We need to support private enterprise as public efforts have failed during the period of this Government. I would prefer to see the Government support a public company with quoted shares and accountable to an investing public free of Government control, doing the same job more effectively.

On section 7, what is meant by the target investing date? What will the Minister invest if not £300 million initially? What is the long term investment plan for this corporation? Will shares have a fixed cumulative dividend? Will the corporation pay an amount similar to interest? Even if we were to lose money in the immediate years, it would be reasonable to expect that when the corporation make a profit they would make some return to the Government by way of a dividend which would be shown in the accounts of the corporation. The principle objectives as set down in section 10 are ridiculous. Section 10(1)(a) says:

to invest, in consultation, where appropriate, with State-sponsored bodies, in any enterprise (including any enterprise which is wholly or partly owned by a State-sponsored commercial enterprise) which, in the opinion of the Corporation, is profitable and efficient or capable of becoming profitable and efficient...

It is ridiculous that this should be the situation because one could take from that that they would be required to invest in supermarkets, petrol filling stations and so on. Why should they be excluded, although quite clearly they are from reading the section? Priority has not been given to the two industries most central and important to the economic security of this country, the manufacturing and building and construction industries. One must ask what resources will be made available under section 10 (1) (b) which states that the principal objects of the corporation shall be stated in its memorandum of association to be "to manage, assist (financially or otherwise)..." One must ask what resources the NDC will have to manage the affairs of other companies. It is not stated in the Bill, neither was it stated in the Minister's speech. Section 10 (1) (c) is "to establish, either alone or in co-operation with a State-sponsored commercial enterprise, any enterprise which has reasonable prospects for profitability, development, expansion, growth or providing viable employment". It appears to envisage that the NDC will set up new companies. This is absolutely crazy. They could end up with ten or more subsidiaries which they are not allowed to do in section 28.

Why has tourism been singled out under section 10 (1) (d)? A Deputy who spoke here said that tourism is a very important area of great opportunity for development, but saying that, as I do, on the one hand and recognising the shabby manner in which the tourist industry has been treated by this Government in recent years, it is nothing short of hypocrisy to imply in this Bill that tourism will get a special position, considering the fact that a White Paper produced recently ignored completely the fact that investment and taxation are essential to an improved environment for tourist industrial opportunity to obtain. The Minister for Industry, Trade, Commerce and Tourism has attempted to dismantle the regional tourist organisations. The responsibility for investment by Bord Fáilte in tourism has been removed and handed back to the Department who have not the experience, expertise or know-how to carry out the function of investment, and they are obliged to give consent or approval in some miniscule or irrelevant areas where Bord Fáilte would wish to carry out certain functions. Their functions are now limited to consultations or consultancy on the one hand and sign-posting on the other, a really unimportant role for the body known as Bord Fáilte, the central tourist authority.

A few weeks ago the Taoiseach made reference in a speech to his intention to provide capital grants of up to £30,000 for hotels and guesthouses. One must establish what exactly this Government propose to do about tourism. There is no consistency in any of their plans; in fact there is no plan and to single tourism out here is nothing more than a Paul Daniels type of illusion that will trap us into believing that something serious or positive will be achieved. It is most unfair to people in Bord Fáilte, the regional tourist organisations, the local authorities, county managers and genuinely concerned vested interests in the industry of tourism to suggest that there is any hope for them in this proposed legislation. As I have said, it is proposed to make further grants to hotels and guesthouses. The Taoiseach announced that very recently. For the life of me I cannot understand what he really is proposing or intends to get.

Section 10 (1) (g) provides that the corporation are:

to invest in any enterprise whose functions include developing or entering into long term supply contracts between producers and processors where such an enterprise, in the opinion of the Corporation, is profitable and efficient or capable of becoming profitable and efficient and has reasonable prospects for profitability, development, expansion, growth or providing viable employment.

Again I am confused. Agricultural long term contracts have been found to be notoriously bad in the past as farmers tend, rightly and understandably, to sell to the highest bidder. In the present economic position in which the Government have left so many farmers I have no doubt that they would be very foolish to pass up the occasion to take the highest bidder at the first available oportunity.

It seems strange that the corporation get a dividend. I cannot understand why the Government would not be paid a dividend. I see no reason why the NDC should not operate as a corporation in accordance with normal financial criteria, but of course it was never intended, as Deputy Lenihan said this afternoon, to be a serious attempt at pursuing a proper economic policy or to develop opportunity or to achieve results. It is an attempt to accommodate a political relationship that is now under considerable stress and strain and will collapse within a matter of months, but the opportunity will have been taken once again to consume the time of this House and the public imagination with the expressed intention of diverting the attention of serious minded people away from the tragedy that has been brought about in almost every area by this Government conspiring and contriving on a daily basis to achieve the maximum political gain for the purpose of staying in office a little longer, knowing that their time there is short. Their options are running out and the patience of the people has run out.

The Government at this stage know the priority areas for investment and the priming that is needed for an economy in such difficulty as ours is at the moment. The State is involved in many areas of economic plight. Our semi-State bodies over the years have done an exceptional job of work. We can recall with pride the success of Bord na Móna and peat production, transport under certain difficulties and Aer Lingus. We have many areas that need investment. Lack of investment has brought about disastrous consequences for many semi-State bodies here in recent times. There are enough agencies in existence who have a proven record of good performance on behalf of this nation. They have been promoting, developing and investing and the Government have ignored totally the opportunities that private enterprise could provide if given the opportunity and the economic environment of confidence and trust.

If to make a profit was not a crime under the present administration the profits of private enterprise would be going back into the various businesses and would ensure, alongside the expertise and good functioning of semi-State bodies, that unemployment would be tackled seriously and positively and would in a matter of a few years show a tremendous reduction. However, the Government, for some reason I cannot understand, have failed to take on board uncomplicated solutions to our problems. There is no indication, contrary to what the Taoiseach and his Ministers have been saying, that the country is getting out of its economic difficulties. Businesses are collapsing all around us.

An Ceann Comhairle

The Deputy should relate his contribution to the Bill.

Mr. Doherty

I am trying to invite the Government to engage in sensible, reasonable and desirable thinking rather than having this stupid, unimportant nonsensical exercise we are forced to participate in for the purposes of the non-event politics of the combination of parties in Government. I must refer to the areas of importance if the Government are serious about achieving economic development.

An Leas-Cheann Comhairle

A passing reference is permissible.

Mr. Doherty

It is sad that our people no longer have confidence in the Government, but that is not surprising when one reads the contents of the Bill. People no longer have trust in the Government or the institutions of State. That is a frightening new development and the Bill advances it. It is desirable that the Government are seen to be a partner by workers and business interests. Otherwise more people will engage in the black economy which has flourished in recent years. Unless serious amendments are made to Government policies anarchy is around the corner.

It is wrong to describe the Bill as anything other than a political exercise. Over a ten year period the £30 million invested on a yearly basis will mean £30 million in losses. According to section 33 a maximum of £250,000 will be provided for the purpose of leasing offices and accommodation. I doubt that the corporation will be allowed to survive in view of an imminent change of Government but, if it survives, I am satisfied it will contribute no more than its own bankruptcy and a total loss of the capital invested.

Mr. R. Bruton

It is disappointing to see speakers on the other side acting as begrudgers. They acted in the same way when the IDA were established by the House. They choose to ignore the poor performance we have had from the indigenous Irish section and seem to be content that 80 per cent of exports should come from foreign corporations. The Opposition seem to be content to see Ireland become an outpost in the back woods for these foreign enterprises. It is disappointing that that destructive attitude is being adopted by the Opposition. They are choosing to ignore the enormous success of agencies in the venture capital area doing the type of work that the NDC is designed to do. For example, I should like to cite the US experience where they say that for a £200 million investment in venture capital they succeeded in producing £6,000 million in sales, growths per year of 33 per cent per annum and money from tax revenue of £100 million. That is exactly half the money that went in every year from the corporations being set up. This is the sort of success that we can achieve with the NDC properly designed and structured. It is disappointing to hear Opposition speakers harping about the way in which the legislation is being brought forward and complaining of duplication when it is quite evident from the Bill that there is no duplication whatsoever. They seem content to see what we have seen here over the last 20 years — high rates of investment, yet a starvation of resources for the productive base of the economy and the main vehicles of investment going into property and Government gilts — the non-productive areas.

This move to establish the NDC represents a major point in that performance which we have experienced to date. It is an entirely worthwhile initiative. There is an enormous gap to be filled by the NDC, a huge gap in the financial structure for venture capital. The bulk of the funds that have been spawned by our financial institutions are not by any means venture captial, although they might choose to call it that. They are essentially the funds of people who are only willing to put their money into companies with a well defined market, with well defined products, that have a good foothold in those markets. These are not venture capitalists. They want very sound, bankable projects and the only reason that these financial institutions here call themselves venture capitalists when they are financing this type of operation is that of their dismal failure in the past to provide any money that could be available to people setting up in new industry other than on the old terms. Those terms, as you well know, a Leas-Cheann Comhairle, are five year loans and the like, repayable constantly. No person setting up in the formative years of a company or enterprise can repay money on that basis. These financial institutions are quite happy to give somebody, perhaps building a house or a property, 30 year funds with no such commitment. Their only reason for doing that is that they have been too linked with the idea of wanting full security for their investment. That is something which does not exist in the financial structures of other countries. In countries like Japan, the United States and even the United Kingdom, the banking system is quite willing to put forward funds to new companies trying to set up on other than short term bases. We have been locked for too many years into a situation in which the productive base of the economy, the people willing to set up a viable employment creating activities, have not had access to money on reasonable terms. We found that it has only been through the grace of the IDA that any such funds have become available and that has been on a narrow grant-giving basis. That is not satisfactory, for the most obvious reason that, by and large, those grants coming from the IDA have gone to foreign corporations.

The whole beauty of the NDC is that we keep the corporations Irish and if we are short of skills we bring in skills from abroad. It would be very retrograde not to move with this opportunity offered by the NDC to shift from what we have known for so long — foreign based industries gaining the major benefits from their enterprises here. This corporation offers the opportunity of a shift to Irish owned and Irish run businesses providing the jobs and the economic future for the country. That, as we have learned to our cost in recent years, is the only way in which we can assure that companies will be well rooted in Ireland.

We must recognise that under the business expansion scheme the needs of venture capital are slowly beginning to be met. It is entirely beside the point for people to say that there are plenty of funds there and that the shortage is in projects needing to be financed. The reality is that there is a gross mismatch between the sort of funds available generally in this economy and the sort of investment projects here. It is only one or two funds that have been established under the business expansion scheme being brought in by this Government that are slowly beginning to fill some of that gap. There remains an enormous gap still to be filled and the NDC will be moving into that as one of its targets.

It is quite right for people who have commented on this Bill to say that we must be very careful to avoid duplication with the IDA. The Minister has stated that he will be insisting on an operational agreement between the two. That will be very worthwhile. There are very important things that need to be done that the IDA have not touched on at all. One obvious one is to provide loan capital other than on a very short term basis which, as I have described, is all that is available from the normal financial institutions. There is a need for genuine venture capital to finance companies at the start up stage, not when they are well established. There is a need for seed capital, by which is meant money available to finance companies in the pre-production phase. Private venture capital funds are not willing to look at that phase. Obviously, small individuals who have ideas and want to do some research and establish prototypes that might be launched on to a market find that all costs money and private funds are unwilling to go along with that here at present. That is a huge gap that needs to be filled by the NDC and it will be very successful in doing that.

Probably the most important job for the NDC which the IDA do not do is to set about nurturing corporate entities here that are capable of bringing opportunities to fruition. While it is true to say that there are projects about, we cannot ignore that there is a great lack of an adequate number of projects which have a decent chance of success. The problem has been predominantly the lack of management teams in Ireland capable of bringing forward a project to a phase where it can start up and get going. The NDC would fail to fulfil their potential if they sit in their office waiting for people to come to them with ideas and if they acted as a passive venture capital financing agency. The important gap that the corporation will move into is entirely distinct from any of the private funds in that they must set about nurturing ideas and the management teams that can bring those ideas to fulfilment. The IDA's approach of enterprise development and of marketing aids, grants and so on, are all very well if we had good sound teams coming forward looking for those aids. The reality here is that we do not have such management teams. The NDC should devote themselves to developing just such teams, developing the sort of structures in which they can work successfully. I do not believe that the corporation should be confined solely to companies in the traditional way that we have known them.

It is very welcome that the terms of the corporation also provide the possibility for them to get involved with co-operatives. There has been an enormous success in the development of the co-operative idea in other countries. In particular, the Spanish experience, where well structured co-operatives that guaranteed from the outset that they would have a sound financial structure and also had very tight control on the remuneration and takeout by those involved have been highly successful. The structures which exist in Spain are ones from which we could well learn here. I would see the NDC as being a very active agency to promote, not just the traditional corporation idea as a way of generating enterprise but the co-operative approach that has been so successful in other countries where they have been properly structured. The failure of co-operatives in the past has been due to the fact that their structures have not been sufficiently soundly based to make sure that they would succeed in difficult times. We can learn from the Spanish experiment where they have had no redundancies in 30 years of experience with these co-operatives. We will only learn from it if we have a State agent who will act as a gadfly to promote these groups.

The NDC will have to be a very different sort of State agency from anything we have set up before. We are demanding of them a uniquely difficult combination of things. They have to be strictly commercial, highly inventive, with an eye for combinations that can prove successful over a long period of time, not necessarily in the first year or two of operation. This is definitely new wine that we cannot pour into the old skins of semi-State bodies as we have known them. We must break new ground in structuring the NDC if they are to fulfil their unique role.

There are some absolute prerequisites if the NDC are to succeed. There must be a very exceptional team of workers. The Minister has rightly drawn attention to that need. However, I would question the terms of section 27 where it is specified that the rewards to be offered to members of the NDC are to be within DPS rulings. The Department of the Public Service will be setting terms of remuneration and providing directives not only for the staff generally but also for the chief executive of the NDC. That is not the correct way to proceed.

Where venture capital has succeeded, where companies like the NDC have succeeded, is where they have had the very top people. Many of these will perhaps have to be found overseas if they are not found in Ireland. We would be hamstringing the NDC if we hammered them into the old mould of DPS restrictions on pay and terms of employment. If we want individuals in the NDC who are capable of doing the highly difficult task of picking winners which can provide commercial return, we must be willing to pay them rewards commensurate with that extremely difficult task. Section 27 must be seriously examined before it goes through.

We must also break entirely new ground with regard to freedom from arbitrary political intervention. I welcome the Minister's statement that, where ministerial directives are issued to the NDC, they will be of a general nature. In other words, he does not intend to issue orders to the NDC which would deal with specific investments or day-to-day operations. However, I question whether he has gone far enough in this respect. Very real concern has been expressed that the NDC could in time be subverted to supporting particular politically sensitive industries or industries in politically sensitive areas, that they could be subverted from their commercial brief towards a social or political brief.

This is a threat which has been mentioned by outside commentators and it behoves us to draw special attention to it and structure the Bill so that it could not happen. The reason it is more important in the case of the NDC than in the case of other semi-State bodies is that the latter have very clear commercial targets to be achieved. A company running on normal commercial terms can see profits or losses on a year by year basis, but the NDC will have long gestation periods in their investments and the possibility of failure will be slow to come to the surface. We should build in more protection.

Having set up the NDC with a clear commercial brief, I do not see why we should require them to go back to the Minister for sanction in cases of projects over a certain figure, or to go to the Government for sanction in cases of investment over another figure. If we set up a company with clear-cut objectives, targets and performance measures, we should not ask them to come cap in hand to the Minister or the Government for approval to do what they have been set up to do. I do not see the sense in having that control over the activity of the NDC. The argument in the White Paper is that the NDC might have too many eggs in one basket if this provision were not included. If we set up a corporation with a decent board and decent employees they will not put all their eggs into a basket and threaten the viability of the corporation. Certainly I do not think the Department of Industry, Trade, Commerce and Tourism would have any more expertise to tell us there were too many eggs in a particular basket than would the NDC themselves. There is no necessity for ministerial control over these matters. Ministerial control should be only in regard to setting objectives and clear performance tests for the corporation.

Although the Bill states that only general directives will be given, some general directives could subvert the commercial thrust of the NDC. For instance, if the Minister should insist on a quota of funds going to a particular type of industry or to a particular region, that would be pulling the NDC away from their initial criteria. It is the Minister's role to set targets if he believes they should be adhered to. However, if the Minister is going to tell the NDC that he wants a certain quota in a certain region, or for certain industries, or for certain types of people, he should be willing to pay an explicit subsidy by way of grant-in-aid to the NDC, a sum that would bridge the gap between the target rate of return they are expected to achieve and what they could achieve by adhering to his directives. In other words, if the Minister is to tell them to support certain social causes or certain areas which are having difficulties, he should be willing to give extra money to finance them specifically. He should not be able to do it under the counter, if you like, by just telling the NDC: "I want so many of your enterprises to be located in County Donegal this year".

I have referred to remuneration for NDC employees. Another matter on which we must be more careful in the framing of the corporation than in the case of other corporations is duplication vis-à-vis the other agencies. The provisions in section 10 are not sufficiently clear-cut to clarify the borders between the different agencies. We have several bodies operating in spheres similar to the NDC in some respects. Most comments have been concentrated on the IDA who predominantly provide grant aid as well as assistance to enterprise development, marketing aids and many such developments. But there are other agencies which must have clear lines of communication with the NDC. In particular I would refer to the NBST who are charged with the duty of bringing science and technology to economic fruition. We have the ICC who are supposed to provide the financial base for industry.

We must look radically at what the ICC are doing. The private financial sector have failed to provide the proper venture capital, but that is equally true of the ICC. They have failed to come forward with venture capital. They have worked on very conservative banking criteria when financing enterprises. They have failed to take equity participation of more than 20 per cent, and this has confined them to providing only a very narrow kind of financial package for potential investors.

Therefore, we must not only ensure that the NDC will not encroach on the IDA or the ICC, but we must look at the ICC again to make sure they are doing what they should be doing. They should be taking up the financial funding of new enterprises, which they are not doing. That may have to be done by the NDC because the ICC are not doing it. We should make the ICC into a more flexible financial institution than they are. That would free the NDC to concentrate on an inventive approach to new enterprises. That would get the corporation out of a solely financial role and into the far more important role of discovering new enterprises, putting together good corporate teams, co-operative groups and so forth.

I suggest that it is time to question the entire concentration of the IDA on grant giving as against taking equity shareholding. The IDA have been forced by the poor packages offered by financial institutions to take up a sort of banking role, so that the IDA have become, in a way, venture capitalists without getting returns on their investments. We now have an opportunity to look again and question whether they should be taking more equity participation in industry as opposed to merely grant giving.

The reason I bring up the roles of these companies is to try to ensure that they are doing what they ought to be doing so that the NDC will be left free to do the formidable and very important tasks of developing true enterprises and opportunities and to fill in for deficiencies in the existing institutions.

I warmly welcome this exciting Bill which offers great possibilities for new enterprise development. The success of such agencies in the US has been enormous. We cannot wait for private imitations which have been so slow in coming. This Bill is one of the most worthwhile initiatives we have seen in recent times and I look forward to the day when it will be looked back on as a milestone in the way the IDA were looked back on when they were established in 1957.

Dr. O'Connell

I agree that indigenous enterprises in Ireland need to be promoted, stimulated and encouraged if we are to strengthen and consolidate our economy. I listened with great interest to what Deputy Richard Bruton has said. I am afraid he does not echo his brother's views on the NDC. What is in a name? The only conclusion I can come to is there may be many votes in it, and that seems to be what the Government think. Why else would they waste so much time and effort and taxpayers' money to change the name of the National Enterprise Agency?

We have to admire their advertising. They will take away your old fashioned brand X, the NEA, and they will replace it with a new improved miracle, the NDC from Labour Party Enterprises, with the added ingredient of £300 million of share capital, all guaranteed to wash away those nasty unemployment figures. I would love to buy it, but so would the 250,000 people on the dole and on Government schemes for pretending that they are not unemployed. So would the 20,000 people who are emigrating annually.

We would love to believe that the £300 million is real money, but we cannot help but remember whom we are dealing with. This is the Government that raised more than £84 million on the youth employment levy and passed only £5 million on to the Youth Employment Agency. This is the Government that slashed capital spending by 25 per cent and left 45,000 building workers without jobs. This is the Government that have been content to watch living standards drop by 10 per cent. Now they want to pose as the people who discovered the merits of Government spending.

Perhaps they intend to raise this £300 million by borrowing. After all, this Government of fiscal rectitude have us in debt to the tune of £22½ billion. These gimmicks would be embarrassing during the run-up to an elaction but to see this administration after three years in office playing musical chairs with our semi-State bodies is nothing less than shameful.

What purpose will this charade serve? What national developments can this corporation bring about that were beyond the powers of the NEA? The answer is that the NDC are the development. Overnight they will create jobs for the unfortunate workers made redundant by the scrapping of the NEA; they will go to employ a board of directors and probably give work to the people supplying their office furniture, etc. By then, of course, it will be time for another election and who cares what will happen after that? The Government obviously do not. It is clear from this piece of non-legislation that they are as tired of governing as the people are of being governed by them. It would not be so bad if the Minister, Deputy John Bruton, would give up the pretence about this wretched thing. Was there ever a less likely convert? In the speech with which he introduced the Bill in the House he rephrased a crucial provision so as fundamentally to alter the whole character of the Bill. I quote section (10) (1) (a) which says:

Let us turn aside for the moment from contemplating the idea of State-sponsored bodies investing in enterprises owned by State-sponsored bodies in order to increase private sector activity. It is all too easy to imagine what horrors would emerge from such an incestuous relationship. Instead I am asking the House to concentrate on the last few words on that subsection which read "or providing viable employment;". They recur throughout this section, in the same context, in reference to the National Development Corporation investing in, managing and establishing various enterprises. That fag end of the sentence enshrines the junior Coalition partners' hopes for the National Development Corporation. It means that, if any given enterprise could convince them about providing viable employment, they could forget all about the more stringent requirements, about profitability and so on. That is what is contained in the Bill.

Let us remind ourselves what the Minister, Deputy J. Bruton — who will hold the whip hand over the NDC — sees as their objective. On 23 October he said in this House, as quoted in the Official Report, Volume 361, column 308:

Obviously, its remit will be to invest in enterprises which are, or are capable of becoming, profitable and efficient and offer reasonable prospects for development and the provision of viable employment.

Somehow the word "or" has been replaced by the word "and". Suddenly provision for viable employment becomes, not a satisfactory alternative to efficiency and profitability, but the last and least of the Minister's requirements. The Minister can stand up in this House with his hand on his heart and contend that that was just a slip of the tongue but, of course, he will not expect us to believe him. He has changed the whole concept of this Bill. To contend that it is a slip of the tongue would be good news for the taxpayer worried about the establishment of yet another semi-State white elephant. Instead what we have here is undoubtedly a white mouse, nothing more than a gesture of contempt on the part of the Government to all those seeking a real initiative on unemployment.

What effect is this hollow, semi-State body supposed to have on the crucial issue of private investment in native industry? Can the Minister point to a single line in the provisions of this Bill which will cause the private investor to switch from gilts or property to risk-taking investment? No, he cannot. Instead we have a useless sham whose principal objectives the Minister is standing on their heads before it is even passed into law. This Bill is being called a sop to the Labour Party. It is not even that. It is a dupe, a con trick done on them as well as the electorate. We shall see if the ordinary voter is as easily fooled as are the Labour Ministers in this Cabinet. I hope we have seen the last of these renaming Bills but I fear not. When Aer Lingus get their new fleet, they will abolish that and call them some other name, because this represents the plan of action of the present Government.

The Minister said that some rather more serious changes would be effected when he introduced this Bill. He told us that directors would be appointed without any regard to political allegiance. Certainly I shall not smile at that claim by the Minister or his Party. Political patronage is a very bad business and has done much harm to the reputation of this House. Usually the only person who suffers is the taxpayer in terms of service given by political appointees. Who cares? It is entirely for the Minister's conscience whether his appointees live up to this proud boast.

The present Taoiseach, who is so self-righteous about the question of political patronage once vowed that he would not associate with the Fine Gael Party as long as his colleague, Deputy O.J. Flanagan, was in it, because he stated on television that he was all in favour of political patronage. When he was just a member of the party the Taoiseach called for his expulsion from the party. That same Taoiseach now, with the record behind him of political patronage, could be called king of the political patrons. We shall see the very same happen now with their friends and friends of friends established on these State boards.

Worker directors is an aspect over which the Minister has skimmed, and not looked at nearly closely enough. He mentioned briefly workers' shareholding in industry. I believe this to be a real area for development here. What astonishes me is that the Minister has said on many occasions that private industry should have worker shareholders. But never once has he talked about or initiated any plans for shareholders in State industry. There is a need for it. It is the key to motivation of employees at all levels. A worker with a share in the business has a completely different kind of morale and commitment from one confined to a sterile "them and us" situation.

I should have liked to have seen An Bord Telecom offer their shares to the public, preference shares being offered at a very low price to the workers in proportion to their years of service. This would have afforded them a real say in their operations. It would have been of real advantage to the National Development Corporation or to the ventures in which they would participate. I am disappointed not to find more explicit mention of it in the Bill itself inasmuch as it would contribute to the drive for profitability, development and growth of an enterprise. Why is it not one of the requirements on the Minister's list? Enterprises in which the National Development Corporation invest must make some provision for offering shares to their employees on favourable terms. Since the Minister obviously does not intend to spend his famous £300 million share capital, at least it would provide him with an original excuse for turning down applicants.

While he is considering this let him consider also the £1 billion we are spending on unemployment, on the 250,000 people without a real job. These people have a real share in our national corporation; they were granted it at birth under the terms of our Constitution. What would the Minister, as an expert, advise these shareholders to do? Should they cut their losses and get out, with the tens of thousands currently emigrating to get away from this Government's policies, or should they hang on until the value rises again? When will that be?

Debate adjourned.

Dáil Éireann debate - Wednesday, 6 Nov 1985

National Development Corporation Bill, 1985: Second Stage (Resumed).

Dáil Éireann debate -
Wednesday, 6 Nov 1985