Vol. 395 No. 8
17 Mr. McCartan asked the Minister for Industry and Commerce if he will outline the progress made by the National Development Corporation since it was established; the number of projects in which the corporation has invested; the total sums invested; the number of jobs created from this additional investment; and if he will make a statement on the matter.
Details of the progress and investment activities of the National Development Corporation Limited are provided in their annual reports. The latest report, which related to 1988 and cover post-balance sheet activities up to 26 April 1989, was laid before each House of the Oireachtas on 23 June 1989. This report showed that approximately 1,600 people were employed in investee companies at 26 April 1989.
Would the Minister agree that the total investment made available to NADCORP in recent years is paltry, that there is tremendous potential in terms of worthwhile projects being capitalised through the system and that perhaps betrays a lack of confidence by the present Government in the concept of a National Development Corporation?
In the past three and a half to four years, the amount of capital provided by the State has been just under £17 million. The amount of the investment made has been just under £19 million. I think these are not insignificant figures. The amount of money concerned is less important than where it is invested and I have encouraged NADCORP to seek out innovative and technologically advanced projects for investment rather than see themselves as an ordinary commercial bank, which is a trap they could easily fall into.
Arising from the Minister's reply, could the Minister say whether NADCORP have invested in the rescue and management buy-out of ailing companies? Perhaps the Minister would comment if National Development Corporation have ploughed into any ailing company money which has brought about its successful reconstruction?
There are dozens and dozens of investments made by NADCORP and I would have to go through them all to find out if any of them fall into that category. I could not say. They would not see that as one of their primary functions, but it may well be that they have, in fact, invested in those circumstances in some cases.
Would the Minister be in favour or against such investment?
Yes, certainly, provided the other criteria that were appropriate to NADCORP were complied with. NADCORP are not and will not be, as far as I am concerned, a latter-day Fóir Teoranta.
Two Deputies are offering, I will facilitate both Deputies if they will be brief, Deputy Rabbitte and Deputy S. Barrett.
Does the Minister not agree that the sum of £17 million and £19 million respectively is very tiny in comparison with the amount of money we invest in industrial policy in either direct subsidies or tax breaks, and that the practice that has grown up of a very minor involvement by NADCORP in a range of companies is not in line with the thinking which was behind the National Development Corporation, which was to facilitate opportunities that would be identified for a major job creation and major investment by the State to encourage it to the stage of viability?
I do not think it is true to say that NADCORP always have a very minority holding. It is generally in the minority but it is not just a tiny or minimal holding. The shareholding in many of these companies is substantial and gives a significant say to NADCORP in the running of the company.
I see from going through the list that in many cases NADCORP hold 100 per cent of the redeemable preference shares in many of these companies but that of course would not necessarily give them any great control as they would not normally be voting shares. As far as the amount is concerned, I suppose one can make the case in respect of any agency or State activity that more money could arguably be spent. However, NADCORP are happily coming into a situation that they are realising some of their investments. Some of their investments have been quite profitable and out of their own resources they will have additional capital funds at their disposal which they can invest from now on.
Arising from the Minister's reply, may I congratulate him on saying that he has no intention of allowing NADCORP to become a rescuer of lame ducks. I think it would be detrimental to the future of NADCORP if they were to engage themselves solely in that activity.
Does the Minister see any need to amend the existing legislation which set up NADCORP in order to allow them to expand to other areas? Is the Minister satisfied that the existing legislation is satisfactory for the job that NADCORP have to do? Will the Minister also confirm that if more money is available for worth-while projects the money will be forthcoming?
I have not had it represented to me that the legislation is unduly restrictive either by the corporation or by anybody else. I met the board of NADCORP on 11 January and I made certain suggestions to them as to the direction they might move, and that certainly can be done without amending legislation. If there are really worthwhile opportunities, particularly in the field of innovative activity I hope they would not be short of money in regard to that. They will increasingly have control over their own affairs from now on.
