Dáil Éireann debate -
Wednesday, 28 Feb 1990

Vol. 396 No. 4

Turf Development Bill, 1988: Committee Stage (Resumed).

As amendment No. 13 and amendment No. 2 to amendment No. 18 are related to amendment No. 2 on which we are resuming, they are being discussed with amendment No. 2.

Debate resumed on amendment No. 2:

In page 2, line 30 and in page 3, lines 1 to 19, to delete subsections (5) and (6) and substitute the following:

"(5) The Board may——

(a) not offer preferential loans to its wholly or partially owned subsidiary companies;

(b) not provide any subsidies, nor provide goods and services on preferential terms to its wholly or partially owned subsidiary companies;

(c) guarantee, in such form and manner and on such terms and conditions as it thinks fit, the due repayment by a company of the principal of any moneys (including moneys in a currency other than the currency of the State) borrowed by the company or the payment of interest of such moneys or both the repayment of the principal and payment of the interest and any such guarantee may include a guarantee of payment of incidental expenses arising in connection with such borrowings and may be a guarantee of payment of a promissory note made by a company or a bill of exchange drawn or accepted by a company.

(6) (a) The exercise of the Board of any power conferred by this section shall be subject to consent of the Minister and where the value of the capital funds committed, or the value of any longterm contracts entered into by the Board exceed £10 million, shall be subject to the consent of the Minister for Finance.

(b) The Minister shall refer any proposed company trading in the home market to the Fair Trading Commission to establish Fair Trading Rules, if the Minister has reason to believe the proposed company might taken a dominant position in the market liable to conspire against the public interest.

(c) The Board shall publish each year a full set of accounts in respect of the ventures established under this section.

(d) The Board shall present the Minister every five years with an assessment of each venture established under this section outlining the return on capital achieved and the justification of retention by the Board of its shareholding.".

——(Deputy R. Bruton.)

Mr. R. Bruton

I would like to say at the outset that I am very unhappy with the way in which we are approaching this debate. We are essentially being asked to debate the future of Bord na Móna completely in a vacuum. The Minister's predecessor commissioned a consultancy report the findings of which were never made public. The feeling is that it has been committed to the wastepaper bin. In any case we certainly have not seen the proposals that those consultants were making for the future of Bord na Móna. Yet we are discussing today a major restructuring of the board.

We are also in a vacuum in that we do not know whether the Minister proposes that the existing divisions of Bord na Móna should be established as private companies. We do not know how the Minister will approach the need for capital restructuring within Bord na Móna which is going to become a very pressing problem. The Minister has not, as yet, sanctioned the publication of the board's annual report but the dogs in the street are reporting that the losses are of the order of £80 million to £90 million and that the board, after those reports are published, will, technically, not be able to meet their liabilities with their assets and will, therefore, face a serious crisis of some sort in which the Government must become involved. We do not know how the Government intend to deal with the restructuring needed and we do not know how each division of Bord na Móna is fareing.

We are approaching this Bill in a vacuum. Indeed, when this Bill was introduced in November, 1988 I made precisely these points, that we were in the dark as to where Bord na Móna were going and that we were being asked to approve a Bill involving the restructuring of the board without knowing what was in the Minister's mind. We are now in February 1990 and we still do not know what is in the Minister's mind, and that is a very unsatisfactory way to proceed. I am hoping that in the course of this debate we will not just see the Minister respond to the letter of the different amendments but that he give us some impression of the way he sees the board evolving with the help of this new Bill.

In moving amendment No. 2 to section 2 I am trying to sharpen the nature of the relationship between the proposed subsidiary boards that are to be established and the parent board, and the Minister in his response to this amendment last week suggested that they were introducing too many restrictions. I beg to differ, in paragraph 6 (a) of my amendment I am requiring that the board would no longer have to have the sanction of the Minister for Finance for investment of a limited extent in new companies and I set the figure at £10 million.

It is about time that we faced up to the situation that if we are to have commercial State bodies performing commercially they cannot be going back to the Minister for Energy and the Minister for Finance for sanction for every little thing they do. The Ceann Comhairle has extended the debate to other sections of the Bill on this proposed amendment. Some of the proposals in this Bill are ludicrous. We have a situation where if the board want to execute building works, if they want to embark on research of any kind whatsoever, they will have to get sanction not just from the Minister, which is ridiculous enough, but from the Minister here and the Minister for Finance. If one employs a dog, one should not do the barking oneself but under the proposed amendments here the Minister is requiring that both himself and the Minister for Finance would do the barking in respect of Bord na Móna. I cannot see the sense of that and I would like to hear the Minister's response.

Subsection (6) (b) of my amendment to section 2 suggests that there be fair trading rules. However, the Minister and Deputy Sherlock suggested this would be overly restrictive on Bord na Móna but the wording is that it only applies "if the Minister has reason to believe the proposed company might take a dominant position in the market liable to conspire against the public interest". This is enabling legislation and we do not know what the board intend to do when they enter new business. The ESB proposed entering the business of coal trading and have entered into the trade of brown goods. Both ventures provoked strong reaction and there were accusations that the ESB were adopting a dominant market position by entering these businesses. I am not convinced that the ESB are adopting a dominant position. Regrettably the ESB have not moved on the coal venture but they have been established in the brown goods trade market for some time, and eventually the Minister for Industry and Commerce referred the matter to the Fair Trade Commission for a ruling.

If we genuinely believe there is a danger of a dominant market position being adopted by a State board entering a new business, we should look at this at the outset and not wait for years — as has been the case in the ESB — and perhaps do serious damage to legitimate traders if the accusations hold up, and eventually find the matter referred to the Fair Trade Commission. All I am suggesting is that where the board are establishing a business and the Minister fears there may be a danger in this regard, it would be much simpler and cleaner at the outset to refer the matter to the Fair Trade Commissioner who would establish rules as to what constitutes fair trade. That would be better than waiting, as in the case of the ESB and then doing the same thing later.

Responding to subsection (6) (c) in my amendment the Minister said he could instruct such accounts to be published. That is fine, but in this House we will have only one chance to decide how we would like to see things done. The Minister has not in the past instructed Bord na Móna to publish separate accounts of the different divisions. We do not know how the milled peat division or the horticultural division are doing financially. I believe that is relevant information to which any Member of this House should have access. The Minister has not taken the trouble to instruct them about the manner in which they present their accounts so that we would have that clarity. I am not convinced by the Minister assuring us that he has these powers because he has not bothered to exercise them in a way I think would give us reasonable information. I still maintain that the board should publish separate accounts in respect of their separate ventures.

In subsection (6) (d) in the context of presenting accounts and the success of the different ventures, I am requiring that the board should do the same as is done in the planning field. At present each State board must have a five year plan projecting where they are going in the future. Equally, after five years trading, Bord na Móna should report to the Dáil on how those ventures are performing and where they see their future. It would be very useful where the board are entering into new joint ventures for them to provide a report on a regular basis, and this would be a new element of the five year planning cycle that is already there.

In subsection (5) of my amendment I am requiring that the relationship between the board and any subsidiary or joint venture that they establish, should be on a normal arms length basis, that the company can put equity into a new venture but they would not give preferential loans or continuing subsidies to the new venture. The Minister suggested that normal commercial companies would be involved in providing subsidies or preferential loans to their subsidiaries. I gravely doubt that, in the case of large companies which establish subsidiaries, it is the practice to give preferential loans to their subsidiary companies. I think they adopt at arms length attitude to those companies and that they require them to stand alone once the equity investment has been made.

The logic of what I am suggesting is that the relationship should be of that nature and that there would not be a continuing subsidisation from the parent company, either by way of preferential loans or any other way to a venture that is supposed to be profitable. In the long-term it would not be satisfactory if we found that the survival of the new ventures which State companies entered into was only guaranteed by preferential treatment from the parent company. That should be put into the Bill. If the parent company want to help a subsidiary, it should be by way of new equity investment and not by way of continuing subsidy.

Minister for Energy (Mr. Molloy)

I replied to some of these points when the Bill was before the Dáil last week. I should like to remind the Deputy and the House of the purpose of the Bill, which I said on Second Stage, is to promote, form, take part in or acquire companies, delegate some of the functions of the board to sub-boards, and to engage in activities not strictly related to peat. We are now on Committee Stage and I do not think it is appropriate that the capital structure of the company or the annual accounts for the past year are strictly relevant to the powers we are proposing to give Bord na Móna under this Bill. I accept that in the context of the overall development of Bord na Móna they are important, but these are matters that have to be dealt with separately, and I have already explained to the House that the annual report referred to was only made available to me in recent times. It has been carefully examined and appropriate decisions will be made by me following full consideration by my Department on whatever steps are deemed to be necessary. I do not feel free to go into that matter here and I trust the Deputy opposite will accept that.

The primary function of the Bill is to give commercial freedom to Bord na Móna. The main thrust of the Deputy's amendments would leave Bord na Móna in a position where they would not have the same commercial freedom as is available to other companies in the private sector. One has to accept that there will be, of necessity, restrictions on a State-sponsored commercial company, but outside those which are absolutely essential, it is my intention — and I hope the intention of the House — to allow State-sponsored companies, such as Bord na Móna, the maximum possible commercial freedom.

As I said last week, it is my intention and the intention of the board at all times that should business practice would obtain in relation to any subsidiary companies to be established. However, I do not consider it necessary that this should be provided for by statute as suggested by Deputy Bruton. If it is considered that the relationship between Bord na Móna, the parent company, and any of their subsidiary companies should be subject to certain controls, there is provision to deal with that on an administrative basis under section 2 (6) of the Bill. I suggest that is the best way to deal with that particular matter to ensure that we are not placing too many restrictions on the commercial operations of Bord na Móna as suggested in subsection (5) (a), (b) and (c) of the Deputy's amendment. In subsection (6) (a) the Deputy refers to the limit of £10 million. Only where that figure is exceeded should the consent of the Minister for Finance be sought. The Minister for Finance guarantees all Bord na Móna's borrowing and total borrowings at present are approximately £186 million. It is desirable that the standard practice of seeking the approval of the Minister should be used in all cases before the board make any further commitments. It is standard practice that the relevant Minister — in this case, the Minister for Energy — and the Minister for Finance would both have to give approval.

Extensive powers are being provided for Bord na Móna under section 2 to found new subsidiary companies, to participate or to take a share in others, to take over companies, to lend or to guarantee loans for a company. It is only right that the consent of the Ministers should be required, as provided for in section 2 (6). Some of these companies may be in other countries or, if in this country, their purpose may be to engage in developments abroad. This is a major expansion of the powers of Bord na Móna and an extension of commercial freedom. The House will wish them well in availing of these powers to establish successful enterprises abroad, as they are already doing.

I see little effectiveness in the ceiling of £10 million proposed by Deputy Bruton. There could be several transactions up to this figure, amounting to vast sums which would pass without the sanction of the Minister for Finance. I would not be happy to stand over such a provision. We have a necessary safeguard which has always been operated and it should not lightly be set aside. I believe the Oireachtas would support my view and I would ask the Deputy to reconsider that suggestion.

While this section relates to financial limits, it will be noted that apart from marketing at home and abroad, activities being opened up by this Bill in foreign countries are generally subject to the Minister's control.

In his proposed subsection (6) (b) Deputy Bruton refers to the need to refer any proposed company trading in the home market to the Fair Trading Commission to establish fair trading rules. The Fair Trade Commission have wide ranging powers already under the Restrictive Practices (Amendment) Act, 1987.

If the Fair Trade Commissioner feels that Bord na Móna are operating in an anti-competitive manner he may initiate an investigation of their practices. He has the same powers in relation to other companies and it would be discriminatory to single out Bord na Móna in the manner proposed in the amendment. The Minister for Industry and Commerce has power to ask the Fair Trade Commission to carry out an investigation into any company which he suspects is operating in an anti-competitive manner. I do not have to remind Deputy Bruton that the Minister for Industry and Commerce has exercised these powers in relation to the activities of the Electricity Supply Board. The amendment seems to be completely superfluous since it would impose a restriction on the freedom of Bord na Móna to operate in the commercial world on the same terms as far as possible as other private companies.

The amendment proposes in subsection (6) (c) that the board should publish each year a full set of accounts in respect of the ventures established under this section. The statutory framework of section 59 (1) of the 1946 Act is already in place to enable the Minister to direct Bord na Móna as to the form of their accounts. In addition, under section 2 (6) of this Bill the power of the board to set up subsidiary companies is subject to the approval of the Minister for Energy and the Minister for Finance and suitable conditions concerning the accounts of subsidiary companies may be attached to that approval if deemed necessary. The accounts of these subsidiary companies must conform as laid down in the Companies (Amendment) Act, 1986. The subsidiary companies will be operating in a competitive environment and it would be unfair to require them to disclose information which their competitors will not have to disclose. Bord na Móna may be obliged to furnish detailed accounts to the Minister but they would not be for publication.

In subsection (6) (d) of the amendment Deputy Bruton suggests that the board should present the Minister every five years with an assessment of each venture established under the section. As a commercial organisation, Bord na Móna will be expected to assess continually the performance of their subsidiary companies. It is considered that the inclusion of a statutory requirement is not warranted. If deemed necessary, suitable conditions may be attached to the Minister's approval under section 2 (6). Since the activities or operations will be an integral part of Bord na Móna operations, there is no justification for such an assessment to be furnished to the Minister on an individual basis. Such an exercise is properly a duty of the management and the board, not only for each venture established but for each and all operations.

I have not been convinced that the amendments suggested by Deputy Bruton should be accepted. I recommend that the House should oppose.

Mr. R. Bruton

I would return specifically to two points. The Minister is proposing here that sanction be required from himself as Minister for Energy and from the Minister for Finance to do the following: execute engineering and building works of any kind whatsoever and research of any kind whatsoever which the board in their discretion consider desirable. If the board decided tomorrow to spend £100 on research or to build a shed beside one of their bogs, not only would they have to go to the Minister for Energy but also to the Minister for Finance to get agreement. The Minister says I am trying to put into statute things that are the normal managerial function of the board. The opposite is the case. The Minister is introducing a requirement on the board that no commercial operation would ever have to envisage. The same is true of many other functions which will require sanction from both Ministers such as the purchasing of assets, entering into agreements for jointly performing a function, establishing a joint company, the acquisition of bogs or any other lands. All these things will require duplicate sanction regardless of their scale. If it is only a very small investment the board will still require dual sanction. That is a charter for bureaucratic involvement in the commercial running of this company that would not be in the public interest.

Regarding annual reports and accounts, it is very frustrating in trying to assess the operations of Bord na Móna, as it is our duty to do, that we do not know, for example, whether their peat briquette activity is performing commercially, how their supplies to the electricity generating stations are performing commercially or how their horticultural peat operation is performing commercially. We have a legitimate right to that information, provided, as the Minister says, it would not create unfair advantage to some competitor. In most of those cases there are no competitors and in many of the cases their competitors in the solid fuel market would normally provide information on their accounts under the normal obligations of private companies. Will the Minister say why he has not taken the trouble to exercise his rights, to allow us see how the company are performing so that we can, in the exercise of our duties, be better informed? Perhaps the Minister would comment on those two points — the extent to which dual and ministerial sanction will stretch into the activities of the company and the format he will be obliging companies to meet in the future in presenting their accounts?

Mr. Molloy

We are talking about a commercial enterprise, albeit a State-sponsored one. My desire is only to apply the absolutely necessary restrictions so as to leave the company as free as possible to operate in the commercial world without unnecessary disadvantage because of being a State body. There is, as the Deputy knows the temptation on the part of the political head or on the part of Members of this House to seek to dictate, interfere, suggest, recommend, influence or pressurise State companies. When one looks at the overall situation one cannot but conclude that if these additional pressures were allowed to develop it would seriously impede the State company from operating successfully in the marketplace.

I remember a time when questions to Ministers with regard to State-sponsored bodies were not allowed. That has been changed, rightly, but at the same time we have to be very careful not to introduce legislation which would make it practically impossible for the State companies to operate. The Deputy will have to understand that in regard to the matters he raised, capital expenditure by Bord na Móna is established on an annual basis. That is built into the Estimates presented to the House. That is the only restriction that applies with regard to the company's expenditure during the year. It must be clear to the Deputy that individual expenditure on buildings, for instance, would not need separate sanction on each occasion. A company operating commercially must be left free to make those decisions within the agreed capital programme. The erection of buildings are not subject to ministerial controls within the State although the Bill introduces controls with regard to erecting buildings in another country. The Deputy can take it that any building to be erected within the State does not require individual ministerial sanction. The only control relates to the capital programme.

Mr. R. Bruton

Perhaps I am exceptionally dense, but I read section 7 of the Bill as saying that

(1) in the performance and exercise of its functions in or outside the State, the board may do all or any of the following:——

among which are included "execute engineering and building works of any kind whatsoever and research of any kind whatsoever" and then we go on and say that it will require Department of Finance and Department of Energy sanction for all of this. Perhaps the ministerial practice is that it only requires approval of the capital programme, but if that is the case why does the Minister not write that into the Bill? The Minister is giving some future Minister an extraordinary power to crawl all over what we hope is a commercial company, in this section. If the Minister is right, maybe a simple change of words would clarify the point.

The Minister's suggestion that I am in some way encouraging political interference or that this lurks somewhere under the surface of the intention of my amendment is beside the point. I am saying that each company must certainly be responsible for their performance and must have a duty to report their performance fully. I am looking for a fuller report of their performance, that is all. I am not looking for a right to interfere in the company's behaviour. We have a right to know how the company are doing. The Minister's suggestion that the Dáil wanting to know how these companies are doing is political interference, is completely beside the point.

We do not seem to be getting very far, and I hope I am not holding up other Members who would like to comment, but it is a fundamental principle of our attitude to State companies that they should not be required to be answerable to civil servants for the tiniest of their actions and that they give a full account to the taxpayer as to how they are performing at the end of the day. We need a commercial sector that knows it will be judged on its performance, free of excessive bureaucratic interference. The purpose of the two amendments on which I am concentrating, regarding the sanction of the Department of Finance and the publication of accounts, is to sharpen up that focus.

Mr. Molloy

The first group of amendments went through quickly without debate and I would refer to amendment No. 18 which was taken in that group. Amendment No. 18 exempts section 7 (a) (1), paragraphs (a) to (g) from ministerial control within the State. I would refer the Deputy back to that amendment.

Mr. R. Bruton

That is in the existing Bill. Those were always excluded from Department of Finance sanctions but Department of Finance sanction is still required for research within the State. It is required for (k), (h) and (i).

Mr. Molloy

It is not required for research into peat-related products.

Mr. R. Bruton

In any other respect.

Mr. Molloy

I do not want to go back on an amendment which has been passed.

An Ceann Comhairle

I would much prefer if we dealt with the section and amendment under discussion. Is amendment No. 2 being pressed?

Mr. R. Bruton

I shall withdraw my amendment in the hope that the Minister will reconsider the question of specifying the manner in which accounts will be presented. He should also consider the extent to which dual ministerial sanction will be required for legitimate commercial trading. As I read it, it will stretch to very small elements beyond the public capital programme which it has been the practice to approve ministerially.

Amendment, by leave, withdrawn.

Section 2 agreed to.

SECTION 3.

An Ceann Comhairle

There is an amendment to this section in the name of the Minister. Amendments Nos. 3, 4, 7, 8, 9 and 10 form a composite proposal and I suggest that they be discussed together. Is that agreed? Agreed.

Mr. Molloy

I move amendment No. 3.

In page 3, subsection (1), line 21, to delete "appoint" and substitute "establish".

These amendments were suggested by the parliamentary draftsman during the summer recess. The most important of them empowers Bord na Móna to dissolve any of the sub-boards established under section 3. The remaining amendments are merely drafting points because provision had not been made for the dissolution of these sub-boards.

Amendment agreed to.

Mr. Molloy

I move amendment No. 4:

In page 3, subsection (2), line 25, after "sub-board" to insert "established under this section".

Amendment agreed to.

An Ceann Comhairle

Amendments Nos. 5 and 6 are related and may be discussed together.

Mr. R. Bruton

I move amendment No. 5:

In page 3, subsection (2), line 27, after "of the board" to insert "and any such other persons from within or outside the company".

In this section Bord na Móna are empowered to establish sub-boards which we are led to believe — although the Minister has not confirmed it — would be involved in running the divisions of their business. Their primary function would be as sub-boards for the horticultural peat division, the solid fuel division and so on. As the Bill is now drafted the only people who can sit on those sub-boards are members of the parent board. The purpose of having a subsidiary board is to bring new blood to a particular section of a company's business. That new blood would be partly from outside the company but also from within it. It could be workers, an executive within the company running the division or it could be new people from outside the company who might have a particular skill, for example, in marketing on the Continent which might be very appropriate to the horticultural peat sub-board if they are established.

I cannot see that there is any sense in the Minister restricting the members of sub-boards to the existing members of the parent board because it would mean that members of the parent board would be overstretched by having to attend maybe several different sub-board meetings. They could not give each meeting the attention it deserves and yet the Minister's provision will be keeping out new ideas from outside the board. In this amendment I propose that we allow the board more discretion so that they are establishing sub-boards they can consider anyone inside or outside the company.

Mr. Sherlock

May I move amendment No. 6?

An Ceann Comhairle

The Deputy may speak to his amendment but only one amendment may be before the House at any given time. Your amendment is related to amendment No. 5 and you may certainly speak on it.

Mr. Sherlock

Section 3 of the Bill provides for the establishment of sub-board structures, a development which we welcome. Subsection (2) says that a sub-board shall consist of the managing director and such number, not being less than three or more than six, of other members of the board as the board shall, subject to subsection (3), from time to time determine. We are anxious that an element of democratic representation should be ensured on these sub-boards and our amendment simply requires that at least one of the workers should be among the directors appointed. There are 12 directors on the main board of which four are worker-directors. It seems reasonable that any sub-board structure, which would include between three and six directors, should include at least one worker-director. It would be a negation of democracy if this did not happen. I ask the Minister to accept this amendment in the spirit of protecting the limited element of industrial democracy which workers have won over the years.

Deputy Bruton pointed out that appointing people within the board may have the effect of putting responsibility on those who are already overburdened. There is no doubt that people have been appointed to boards who have no interest in them apart from attending meetings. That does not apply to everybody but people within the present board structure, particularly worker-directors, would have a greater interest than people from outside. I am aware of the number of people sitting on boards of different companies who take very little interest in them. I have experience of the factory floor and the interest of workers and worker-directors in that structure. Nobody is better equipped to serve on a board or sub-board of a company than the people who are directly representing workers because they are involved in the day-to-day working of the company and can bring their expertise to the board. Such people may also have great business acumen and far more interest than some of those appointed to boards. I have some reservations about people from outside the company being appointed.

Mr. R. Bruton

I said within or outside a company.

Mr. Sherlock

That leaves it a little open and that is why I have reservations about that part of the amendment.

Mr. Moynihan

There is validity in Deputy Sherlock's amendment having regard to the existing structure of legislation for the composition of the parent board involving a minimum of four worker directors. It would be very undesirable to have a sub-board elected without a continuation of that representation, right down to the bottom line of management. I strongly urge the Minister to accede to that request.

Mr. Molloy

I wish to draw the attention of the Members of the House to the fact that section 2 gives power to Bord na Móna to establish or acquire companies. Under section 3 — which we are now discussing — the Bill will give power to the boards to establish sub-boards. The primary purpose of sub-boards is to allow any matter to be considered in depth by part of the board rather than the entire board as at present. In accordance with the Turf Development Act, 1946, it is the Government who appoint the members of the board of Bord na Móna. The Minister is agreeable to the board appointing sub-boards but I am confining membership of the sub-boards to members of the main board because it is the Government who appoint the members of the main board. If they are to delegate part of their function to a sub-board, then it would not be appropriate for them to delegate it to a sub-board which had on it persons who were not members of the main board.

The appointment of sub-boards is to allow the board to carry out their functions more efficiently but it would be a serious dilution of their authority if persons on the main board, such as management, staff or persons from outside the company, were allowed to serve on those sub-boards. Those sub-boards will act under and within delegated authority and when they so act they bind the board. If other expertise is required from time to time there are recognised ways of availing of it. The primary justification for the new sub-boards is maximum effectiveness and no other. There may be a misunderstanding about this, that the section under which sub-boards will be established is the section under which separate companies, the different divisions, might be established.

The "divisionalisation" of Bord na Móna will facilitate the establishment of three separate companies eventually if it is deemed necessary by the board to do so. At present we have one company with three divisions and the sub-board idea could be used to oversee the actions of those divisions, but there is a distinction between sub-boards and companies. I should like to tell Deputy Sherlock that it is the board's intention to appoint at least one of the worker directors to each of the sub-boards. It would also be open to the Minister to attach such a condition when giving his consent to the appointment of the sub-boards. It would not be appropriate to single out worker directors in legislation in the manner proposed. Obviously, the board would wish that a board range of skills and background would be represented on each of the sub-boards, but it is not necessary to specify that in legislation. The Deputy can be assured that it is the intention that the worker directors would be represented on any sub-boards established.

Mr. R. Bruton

I am not happy with the Minister's response. As I understand it it is the intention that sub-boards will be overseeing divisions and not simply sub-committees considering a problem as the Minister seemed to suggest. There was confusion in what the Minister said. If it is simply a question of establishing a sub-committee to consider some knotty problem I do not believe legislative sanction is needed. The board could decide that three of their members should study that knotty problem and report back to the board in a week's time. That is not what is intended. We would not need any legislative authority for such a move. We are talking about a sub-board that will oversee on an ongoing basis the commercial operations of divisions of the company. As I understand it, that is what is meant by the delegation of functions to a sub-board. If that is the case the running of a particular commercial division of Bord na Móna should not be confined solely to members of the parent board.

There will almost certainly be a chief executive of those divisions and he or she should not be excluded from the sub-board. That person will be dealing on a day-to-day basis with the commercial operations of the company and should be on the sub-board just as the managing director of the overall company is on the parent board. The Minister has suggested that the reason he did not want to relax this change was because the decisions made by the sub-board would bind the parent board. He could certainly cover himself in that regard. Once the parent board is represented on the sub-board, and the managing director of the overall company is represented on the sub-board, he can have absolute confidence that any decision made by that sub-board binding the parent company will not be one that will be unknown to the parent board. I cannot see how the Minister's argument holds up.

The Minister offered as a second reason for rejecting the amendment the fact that the members of the board are appointed by the Government. The Minister said he does not want to see new appointments being made by Bord na Móna to their sub-board activities; that would not be subject to Government sanction. I am not convinced that Government sanction is necessary for a decision like this but if the Minister feels that Government approval of the appointment of outsiders or insiders is necessary, then I am willing to accept an addition to my amendment to the effect that the Minister should be consulted on the appointment of those people. In principle, there is no point in establishing divisions and giving them an overseeing sub-board if at the end of the day the same people will be appointed. The Minister should bring in new blood, he should bring in the chief executive of the division and any person who can make the venture a greater success. I do not see any point in binding the hands of Bord na Móna to appoint existing board members.

Mr. Molloy

I am not prepared to change my view on this matter. The sub-boards will act in matters which will be delegated to them by the main board and it would be highly inappropriate to include other persons outside those already appointed to the main board on any such sub-board. That would be so because the decisions of the sub-board will be binding on the main board. The delegated authority will be binding and it would be highly inappropriate to have any other person acting on the sub-board who did not have authority to act on the main board.

I can see merit in the Deputy's suggestion that there should be fresh ideas brought in and it may be that he is suggesting that we should expand the main board but I cannot concede the principle that people should be allowed to operate on a sub-board which has the level of authority provided in the Bill while not holding membership of the main board following appointment by the Government. That would be a serious erosion of the whole principle involved and I cannot see my way to accepting that point.

Mr. Sherlock

The main point I was making was that any board which would include between three and six directors should have at least one worker director. I must point out that worker directors are elected to the main board and others are appointed by the Government. It would be a negation of democracy if the majority appointed to the sub-boards were those who were elected. I will leave this to the Minister to consider.

Mr. R. Bruton

I am gravely disappointed with the Minister's response. He is referring to two red herrings. He is saying that the sub-board would bind the parent board and that the Government have to appoint everyone and that their authority would be diluted. I have already acknowledged that I would be happy to allow the Minister alter my amendment so that the Government would have the chance to approve these people. I would stick to my guns also and say that if we want a sub-board who can successfully penetrate the Dublin solid fuel market with peat briquettes or who can successfully penetrate the continental market for horticultural peat, we need people who have particular skills in marketing geared to those markets. There are other persons outside of the existing board who would be well tuned to those particular problems of that commercial division but who would not necessarily need to be involved in all the other activities of the board.

The financial soundness of the relationship between sub-boards and the parent will be guaranteed by having the managing director of the company and many other members of the parent board. The Minister conceded the principle that there are others outside who might bring new ideas to these operations. Having conceded the principle he goes back to his brief and says: "No, it would dilute my authority, it would dilute the authority of the board and I will not have it." I cannot see the reasoning behind the Minister's view. I think that what I am proposing is a very reasonable amendment that would improve the operation of this section. I would ask the Minister to seriously reconsider what he is suggesting because I cannot see that his arguments will hold water, I cannot see any danger to either Government or board authority in what I am suggesting. The Minister should debate this on the merits of whether there are new skills that could be brought into the horticultural peat area or the Dublin markets which Bord na Móna are trying to penetrate. If he considers it on that commercial basis he will come up with the answer: "yes, it would be useful to have new people on to these activities."

Mr. Molloy

I cannot concede the principle that persons on a sub-board who are exercising delegated authority from a main board, which has the power of binding the main board, should include on it persons who are not appointed to the main board. I did not concede any other principle either in my earlier reply other than to state that in the appointment of the members of the main board it is up to the Government to seek to have represented there the various skills which they feel would be beneficial to a board of this nature. One does not see members of the board going out and knocking on doors selling briquettes in Dublin or in France. It is a matter for the board to lay down the broad policy and the strategy for the company and to determine investment policy in regard to the company.

Mr. Carey

It would be worth while for some board members to do that.

Mr. Molloy

It is open to the board to appoint staff in the marketing area or in whatever other skill they require to ensure that Bord na Móna operate in a most effective fashion in the marketplace. We would be mixing up two areas of responsibility here. The board lay down policy which oversees the operation of the company on behalf of the Oireachtas. I am sorry I cannot accede the principle enunciated in the Deputy's amendment.

Mr. R. Bruton

Again the Minister is not facing up to the issue I am trying to put. No one is suggesting that members of the board should go around knocking on doors selling horticultural peat. The point is, as the Minister recognises, that it is vital that there be a good marketing strategy if they are to successfully penetrate the horticultural peat market on the Continent. The skills needed to frame such a strategy by a sub-board are very different from the skills needed to frame a strategy to sell milled peat to the ESB — a sole contractor with no real marketing element in it. There it is a question of efficient production and managing a business that is well known.

The business of penetrating the continental market is new territory for the board. It is something for which you need not only new executives who know what they are doing in the field but also new members of the board who appreciate the importance of a marketing strategy that will succeed in penetrating the continental European market. The same can be said of the Dublin solid fuel market. Bord na Móna have made commendable progress in penetrating the Dublin market in the last year or so but they are still a very minor player in that market. An enormous opportunity is opening up for them this coming October when bituminous coal will be banned and peat briquettes will be a smokeless fuel available on the Dublin market. Again, that needs a good marketing strategy and people on a sub-board who are skilled in that area and who would be well positioned to advise the sub-board on how to approach that problem. The different divisions of Bord na Móna are different in their requirements from board members. New people who can advise on the particular new problems that the sub-boards will encounter are needed. It would be different if these were long-term established operations in the marketplace but both the penetration of the Dublin market and the penetration of the continental European horticultural peat market are entirely virgin fields in many ways. The company have been only scratching at the surface of the opportunities there. The Minister should look again at this section. If he would like time to consider it I would be happy to withdraw the amendment at this stage and reintroduce it on Report Stage when he has had a chance to consult more widely on it. This is a fundamental error in the approach the Government are taking to what would otherwise be a very valuable initiative for the company.

Mr. Molloy

I am not disposed towards changing my mind on this amendment. I am adhering strictly to the principle I have already enunciated. I am glad the Deputy has referred to the sale of briquettes and the success which Bord na Móna have achieved over the past year, in particular in the Dublin market. It had been a matter of great concern to me that Bord na Móna had not succeeded in establishing greater levels of sales throughout the country but particularly in the Dublin market. I am glad that over the past 12 months they have made a major improvement.

Mr. R. Bruton

What share of the market have they got?

Mr. Molloy

I will get the details for the Deputy if he wishes.

Mr. R. Bruton

Less than 10 per cent.

Mr. Molloy

The point I want to make is that the situation that existed and which continues to exist for this season in the Dublin market in relation to the distribution system was one which did not operate to the benefit of Bord na Móna, which is a State commercial company, which produces an indigenous solid fuel material of low smoke value and which provides employment for substantial numbers of people in Ireland. It was a matter of great regret that the board had to report to me last year that they had to close down temporarily two of their briquette manufacturing plants because the sales were not matching production. I found that very disturbing in a country where we are importing such vast quantities of a fuel which was deemed to be unhealthy and unfriendly to the environment here. The Deputy might care to acknowledge that it was this Government who took a step in relation to that matter, a step which I hope will open up new opportunities for expanded sales of Irish briquettes on the home market which will substantially improve the environment in relation to smoke levels, provide much needed employment and give an assurance to those at present employed in this industry of a continuation of that employment at reasonable levels. The matter should have been looked at and tackled long before now. However, it is only in recent times that that issue has been faced up to.

Mr. R. Bruton

Get back to the debate.

Mr. Molloy

The Deputy referred——

Mr. Carey

He has picked up the bad habits of the Minister for Finance.

Mr. Molloy

——to the expertise required in the market-place to sell briquettes, but in fairness when one makes comments of that nature they should give both sides of the coin. The present position is very unsatisfactory and this will continue to be the case during this season. However, as and from 1 October next year, a rew régime will be in place. I hope that Bord na Móna will not have to face the difficulties they had to contend with in the Dublin market from that time on. I expect to see a substantial increase in briquette sales. Bord na Móna share of the solid fuel market is 14 per cent but this is increasing. For example during the past year there has been a 60 per cent rise in sales in the Dublin area. This may seem an enormous increase but it is from a much too small base. I hope to see a substantial increase in the volume of briquettes sold in the Dublin area next year.

Amendment put.

The Committee divided: Tá, 38; Níl, 64.

Tá

• Ahearn, Therese.
• Barnes, Monica.
• Barrett, Seán.
• Belton, Louis J.
• Boylan, Andrew.
• Bradford, Paul.
• Browne, John (Carlow-Kilkenny).
• Bruton, Richard.
• Carey, Donal.
• Connaughton, Paul.
• Connor, John.
• Cosgrave, Michael Joe.
• Cotter, Bill.
• Creed, Michael.
• Crowley, Frank.
• Deasy, Austin.
• Deenihan, Jimmy.
• Doyle, Joe.
• Dukes, Alan.
• Durkan, Bernard.
• Farrelly, John V.
• Fennell, Nuala.
• Finucane, Michael.
• Flaherty, Mary.
• Flanagan, Charles.
• Harte, Paddy.
• Higgins, Jim.
• McCormack, Pádraic.
• McGahon, Brendan.
• McGrath, Paul.
• Mitchell, Gay.
• Mitchell, Jim.
• Nealon, Ted.
• Noonan, Michael. (Limerick East).
• Reynolds, Gerry.
• Shatter, Alan.
• Timmins, Godfrey.
• Yates, Ivan.

Níl

• Ahern, Bertie.
• Ahern, Michael.
• Aylward, Liam.
• Barrett, Michael.
• Brady, Gerard.
• Brady, Vincent.
• Brennan, Mattie.
• Brennan, Séamus.
• Briscoe, Ben.
• Browne, John (Wexford).
• Burke, Raphael P.
• Callely, Ivor.
• Connolly, Ger.
• Coughlan, Mary Theresa.
• Cullimore, Séamus.
• Daly, Brendan.
• Davern, Noel.
• Dempsey, Noel.
• de Valera, Síle.
• Ellis, John.
• Fahey, Frank.
• Fahey, Jackie.
• Fitzgerald, Liam Joseph.
• Fitzpatrick, Dermot.
• Flood, Chris.
• Flynn, Pádraig.
• Foxe, Tom.
• Gallagher, Pat the Cope.
• Harney, Mary.
• Hillery, Brian.
• Kelly, Laurence.
• Kenneally, Brendan.
• Kirk, Séamus.
• Kitt, Michael P.
• Lawlor, Liam.
• Lenihan, Brian.
• Leyden, Terry.
• Lyons, Denis.
• Martin, Micheál.
• McCreevy, Charlie.
• McDaid, Jim.
• McEllistrim, Tom.
• Molloy, Robert.
• Morley, P.J.
• Nolan, M.J.
• Noonan, Michael J. (Limerick West).
• O'Connell, John.
• O'Hanlon, Rory.
• O'Keeffe, Ned.
• O'Leary, John.
• O'Malley, Desmond J.
• O'Rourke, Mary.
• O'Toole, Martin Joe.
• Power, Seán.
• Quill, Máirín.
• Reynolds, Albert.
• Smith, Michael.
• Treacy, Noel.
• Wallace, Dan.
• Wallace, Mary.
• Walsh, Joe.
• Wilson, John P.
• Woods, Michael.
• Wyse, Pearse.

Tellers: Tá, Deputies J. Higgins and Boylan; Níl, Deputies V. Brady and Quill.

Amendment declared lost.

Mr. Sherlock

I move amendment No. 6:

In page 3, subsection (2), line 28, after "determine." to insert "At least one member of each sub-board shall be a person elected to the Board under the terms of the Worker Participation (State Enterprises) Acts, 1977 to 1988.".

Amendment put.

The Committee divided: Tá, 52; Níl, 62.

Tá

• Barnes, Monica.
• Bell, Michael.
• Belton, Louis J.
• Boylan, Andrew.
• Bradford, Paul.
• Browne, John (Carlow-Kilkenny).
• Bruton, Richard.
• Byrne, Eric.
• Carey, Donal.
• Connaughton, Paul.
• Connor, John.
• Finucane, Michael.
• Flaherty, Mary.
• Flanagan, Charles.
• Gilmore, Eamon.
• Gregory, Tony.
• Harte, Paddy.
• Higgins, Jim.
• Howlin, Brendan.
• Lowry, Michael.
• McCartan, Pat.
• McCormack, Pádraic.
• McGahon, Brendan.
• McGinley, Dinny.
• McGrath, Paul.
• Mitchell, Jim.
• Cosgrave, Michael Joe.
• Cotter, Bill.
• Creed, Michael.
• Crowley, Frank.
• Deasy, Austin.
• Deenihan, Jimmy.
• De Rossa, Proinsias.
• Dukes, Alan.
• Durkan, Bernard.
• Farrelly, John V.
• Fennell, Nuala.
• Ferris, Michael.
• Moynihan, Michael.
• Nealon, Ted.
• Noonan, Michael. (Limerick East).
• O'Shea, Brian.
• O'Sullivan, Gerry.
• O'Sullivan, Toddy.
• Quinn, Ruairí.
• Rabbitte, Pat.
• Ryan, Seán.
• Sherlock, Joe.
• Stagg, Emmet.
• Taylor, Mervyn.
• Timmins, Godfrey.
• Yates, Ivan.

Níl

• Ahern, Bertie.
• Ahern, Michael.
• Aylward, Liam.
• Barrett, Michael.
• Brady, Gerard.
• Brady, Vincent.
• Brennan, Mattie.
• Brennan, Séamus.
• Briscoe, Ben.
• Browne, John (Wexford).
• Burke, Raphael P.
• Calleary, Seán.
• Connolly, Ger.
• Coughlan, Mary Theresa.
• Cullimore, Séamus.
• Daly, Brendan.
• Davern, Noel.
• Dempsey, Noel.
• de Valera, Síle.
• Ellis, John.
• Fahey, Jackie.
• Fitzgerald, Liam Joseph.
• Fitzpatrick, Dermot.
• Flood, Chris.
• Flynn, Pádraig.
• Gallagher, Pat the Cope.
• Harney, Mary.
• Hillery, Brian.
• Kelly, Laurence.
• Kenneally, Brendan.
• Kirk, Séamus.
• Kitt, Michael P.
• Lawlor, Liam.
• Lenihan, Brian.
• Leyden, Terry.
• Lyons, Denis.
• Martin, Micheál.
• McCreevy, Charlie.
• McDaid, Jim.
• McEllistrim, Tom.
• Molloy, Robert.
• Morley, P.J.
• Nolan, M.J.
• Noonan, Michael J. (Limerick West).
• O'Connell, John.
• O'Hanlon, Rory.
• O'Keeffe, Ned.
• O'Leary, John.
• O'Malley, Desmond J.
• O'Rourke, Mary.
• O'Toole, Martin Joe.
• Power, Seán.
• Quill, Máirín.
• Reynolds, Albert.
• Smith, Michael.
• Treacy, Noel.
• Wallace, Dan.
• Wallace, Mary.
• Walsh, Joe.
• Wilson, John P.
• Woods, Michael.
• Wyse, Pearse.

Tellers: Tá, Deputies McCartan and Byrne; Níl, Deputies V. Brady and Quill.

Amendment declared lost.

Mr. Molloy

I move amendment No. 7:

In page 3, subsection (3), line 30, after "sub-board" to insert "established under this section".

Amendment agreed to.

Mr. Molloy

I move amendment No. 8:

In page 3, subsection (4), line 36, to delete "appointed under this section shall be such as may be appointed by" and substitute "established under this section should be such as may be determined by".

Amendment agreed to.

Mr. Molloy

I move amendment No. 9:

In page 3, between lines 37 and 38, to insert the following subsection:

"(5) The Board may at any time dissolve a sub-board established under this section.".

Amendment agreed to.

Mr. Molloy

I move amendment No. 10:

In page 3, subsection (5), line 38, after "sub-board" to insert "established under this section".

Amendment agreed to.

Mr. R. Bruton

I move amendment No. 11:

In page 3, between lines 41 and 42, to insert the following subsection:

"(6) The Board shall publish a report annually on the accounts and performance of each sub-board as a separate arms length activity.".

The purpose of the amendment is simply that the House would be informed of the financial performance of the sub-boards. I understand that Bord na Móna will be running their horticultural peat division, solid fuel division and the briquette division separately and I suggest that the board should present separate accounts for each of the divisions so that we know how each enterprise is performing. To judge from the Minister's earlier comments he is not happy to enshrine in legislation the requirement to provide detailed annual reporting and he instead referred to his own powers. However, as I mentioned earlier, the Minister has not chosen to exercise his powers and perhaps he would consider instructing the board when the sub-boards are established to run the divisions, to furnish accounts for those divisions as separate activities.

Mr. Molloy

I want to make it clear that with the appointment of the sub-boards it is not intended to break up Bord na Móna which seems to be implied in the Deputy's amendment that we would have separate accounts for separate divisions. It is intended to facilitate the speeding up of the decision making process at board level. That is the purpose of the sub-boards as proposed and it will also give the members of the board an opportunity of considering matters in greater detail. A sub-board could give special attention to particular operations or divisions and the question of separate accounts would not arise therefore. Where Bord na Móna carry on an activity under company form, accounts of course will be available. The Minister already has the necessary legislative power under the 1946 Act to direct the board as to the form of their annual report and accounts. The amendments Deputy Bruton has tabled give the impression that the sub-boards would act as separate companies. If the main board decide to establish separate companies for each of these divisions they may do so and a separate board of directors could be appointed through the usual procedures as laid down in the various Acts. That has not been proposed. All that has happened is the divisionalisation of the existing operation of Bord na Móna and the facilitating of the creation of sub-boards under this Bill who would oversee the operation of those various divisions. The Deputy's amendment seems to indicate that the separate divisions would operate in the same way as separate companies would and thus would require the publishing of separate annual reports for each of the sub-boards. That is not the intention at all. The main board continue to have overall responsibility and in the accounts of the main board a report will appear on the operation of each of the various divisions within the company.

Mr. R. Bruton

I would refer the Minister to what he said in the House only a few moments ago, that the logic behind the establishment of divisions was ultimately to establish separate companies. It is somewhat unusual for him to suggest now that that is not the direction of thinking.

Mr. Molloy

I do not think so.

Mr. R. Bruton

In the ESB accounts one finds separate presentations of their appliance trading division, fisheries division and so on and one can see how the different divisions are performing. However, if you open the accounts of Bord na Móna you will not be able to see how the different divisions are performing. I am requesting that the Minister by way of accepting legislative amendments or by an administrative order, if he choses to do so, allow us have information about the separate divisions and how they are performing financially.

Mr. Molloy

The manner in which the ESB present their accounts which show what has been happening to the various divisions is not required under legislation. There is no statute which requires them to present their accounts in that form.

Mr. R. Bruton

I would be happy if you would ask Bord na Móna to do likewise.

Mr. Molloy

The various divisions that have been set up within Bord na Móna have not yet been in operation a full 12 months and they will not appear in the existing accounts. Obviously future accounts would make reference to the operations under the various divisions, in the same way as the ESB accounts are presented. It is within the umbrella of the Bord na Móna company that these accounts would be presented, not in a separate form as if they were three separate companies. They are only divisions and sub-boards of the main company. Reference to their performance will appear in the accounts of Bord na Móna.

Mr. R. Bruton

I am asking for a report, not a separate report or a new glossy. I just want to know how these divisions are performing. I will be satisfied if the Minister will undertake to use, if necessary, his power to order the companies in respect of the way they present their accounts so that when the next accounts are produced we will have a proper picture of how the different divisions of the company are performing.

Mr. Molloy

I will be happy to do it that way, to exercise my powers under the 1946 Act to ensure that the accounts as presented will show the performance of each division.

Amendment, by leave, withdrawn.

Section 3, as amended, agreed to.

NEW SECTION.

Mr. R. Bruton

I move amendment No. 12:

In page 3, before section 4, to insert the following new section:

"4. —(1) The Board shall transfer to such sub-boards the assets, valued according to their audited worth to the Board, necessary to execute the delegated function, along with such liabilities determined by its auditors to be supportable by that sub-board operating at optimum efficiency.

(2) Any surplus of borrowings after the auditors have settled the levels supportable by sub-boards, shall be carried by the Board.

(3) The Board shall apply to the service of these borrowings—

(a) dividends remitted by the sub-boards,

(b) the product of a levy as shall be set from time to time by the Board on peat extracted by the sub-boards from the bogs, and

(c) an appropriation as shall be set from time to time by the Minister, after consultation with the Minister for Finance.".

This amendment goes to the heart of the problem of Bord na Móna. It is disappointing that the Bill does not endeavour to look at the financial and capital structure of the company. Every solid fuel manufacturer or extraction industry in Europe in the past four or five years has had to adjust to much lower energy prices and this has caused huge restructuring problems. In all these cases the Government have been involved in a restructuring package of some sort. In many cases this has been phased in over a number of years so that the companies involved could adjust to the new circumstances.

In the seventies Ireland and other European countries cranked up solid fuel production activities in order to meet the crisis created by the oil shortage. Bord na Móna introduced a very expensive new programme of expansion of their peat operations. When it finally came onstream it met with much lower energy prices than could realistically have been expected at the time the Government urged them to embark on that programme. As a result we are informed by rumours in the newspapers that the company this year have had to write off the value of many of their investments and that their accounts when published will show very substantial losses for the year ended March 1989. They will also show that the capital structure of the company is such that their assets do not cover their liabilities. In a technical sense they are insolvent. When the accounts are available there will inevitably be some question of Government involvement as regards the unsecured portions of the loans raised by the board.

We need to look at Bord na Móna's operations in a structured way and to put together a package which would allow their commercial divisions, to thrive. We have seen in the past two or three years an enormous about-turn in the way Bord na Móna have done business. They have pulled around their commercial activities so that in the year ending March 1990 they will show commercial profits, even meeting the interest on enormous loans of £180 million or £190 million. However, they will be technically insolvent and they will not be in a position to undertake the planned launch into the European market or the launch into the Dublin fuels market, on the basis of those heavy borrowings.

We are at a crisis. The Minister's predecessors commissioned consultants to examine the problems of Bord na Móna. Those consultants, to my knowledge, did not come up with any proposals that met with the approval of the Minister and we have heard no more of them. The board have been stalled while this has gone on and the Minister has not come forward with alternative restructuring proposals. The Minister argued in the House that he formally received the accounts of Bord na Móna only on 5 February, but newspaper reports indicated the financial problems of Bord na Móna long before that date. The Minister is playing with semantics when he says that only on 5 February did he becomes aware of their financial difficulties.

The purpose of this amendment is to look in a rational way at how we can deal with the crisis which will otherwise break upon Bord na Móna. I have put forward a solution along the lines of that provided for NET where a holding company was established which was separate from the operations division. Debt which was excessive to what the operating company could bear was transferred to the holding company and serviced separately from the commercial activities of the operating company. I have a similar proposal here, namely, that we should look at the different operating divisions of Bord na Móna and establish the level of liabilities which those divisions could support when operating at optimum efficiency.

This approach is not original since it was advocated in 1984 by the National Planning Board in their report which dealt with our State companies and recognised that some of them would not be able to recover or grow of their own accord because of the high level of borrowings they carried. A restructuring was proposed, from which point they could grow and evolve commercially and successfully. The holding company, which would hold the surplus of borrowings which were not supportable by the sub-boards, would be serviced in a number of ways: first, by dividends from the sub-boards which would compete successfully, grow and produce profits; second, another possibility would be a levy on the peat extracted by the different sub-divisions; and third, the Minister, after consultation with the Minister for Finance, would pick up the costs which were not sustainable. This is an alternative to a straight injection of equity.

The Government are not well disposed to an injection of equity because they have argued that they would have to borrow it themselves. They do not see that as a viable proposition at present. One or other approach will have to be adopted by the Government. The alternative I have set out would give Bord na Móna the financial environment in which to develop their business with an orderly support from Government. We are not asking the Government to support a nonviable, lame duck enterprise. Bord na Móna are in profit as of 1990 but their overhang of debt accumulated in the past is of such proportions that it will blight every commercial enterprise from here on and will leave the company technically insolvent. Something has to be done and if the Minister does not see the merit in this suggestion, I would like to hear what he would envisage as being the solution to this problem which is of serious proportions.

Mr. G. Mitchell

With regard to the structuring of the company and the whole question of the way the accounts are structured, examined and reported on, the Committee of Public Accounts set up what was called the advisory group on public financial accountability, consisting of some of the most eminent people in the private and public sector and they reported to the committee who endorsed their report and reported to this House. I understand a change is taking place or has taken place in the auditing requirements of Bord na Móna in that the control of the Comptroller and Auditor General as auditor is being replaced by a private firm. I have no difficulty with that. The Committee of Public Accounts special report which was debated by this House included provision to enable the Comptroller and Auditor General to surrender the audit of commercial State-sponsored bodies which could be taken over by private firms, there by relieving him of a lot of pressure.

The report also recommended that the Comptroller and Auditor General should have inspection and reporting rights to the Committee of Public Accounts. This is distinct from the performance review which is carried out by the Committee on State-Sponsored Bodies. The question is one of propriety, audit and regulation. For instance, in the UK when the De Lorean Company were accused of fraudulent behaviour with taxpayers' money, it was the public accounts committee which pursued that matter. Where there is fraudulent or inefficient use of resources, the Comptroller and Auditor General should be able to report the matter to Parliament. That should be separate to the normal audit provisions. The recommendations of the committee with regard to inspection and reporting rights by the Comptroller and Auditor General should be implemented in the case of State bodies particularly where the Comptroller is surrendering the audit to a private company.

The Minister should bear those points in mind. It may be a matter which will be addressed in legislation concerning the office of the Comptroller and Auditor General but we should not be upset if Parliament were to have a role in ensuring that State-sponsored bodies, especially commercial bodies, have accounting requirements which ensure that their accounting practices and procedures are examined by the Comptroller and Auditor General and that he has an opportunity to report these matters to Parliament.

Mr. Sherlock

This section relating to powers of the board outside the State is very important and acceptable. Perhaps there is an ideological difference between Deputy Bruton and me but I am surprised that in amendment No. 2 Deputy Bruton says that:

the Board may

(a) not offer preferential loans to its wholly or partially owned subsidiary companies;

(b) not provide any subsidies, nor provide goods and services on preferential terms to its wholly or partially owned subsidiary companies.

Is there not a total conflict in what is proposed in this and what the Deputy is now seeking? The main problem with what is being proposed is that it says in the amendment:

—(1) The Board shall transfer to such sub-boards the assets, valued according to their audited worth to the Board,...

That is a very narrow perspective in creating financing for sub-boards. The other point about which I have difficulty is where it says:

along with such liabilities determined by its auditors to be supportable by that sub-board operating at optimum efficiency.

That kind of terminology means that we are saying to the board we are now allowing the board under section 4 to trade outside the State but to restrict financing to that effect is something I would find very difficult.

Mr. R. Bruton

It is a new section. It has nothing to do with the existing section 4.

Mr. Sherlock

I appreciate that, but when the Deputy puts in such terminology as "supportable by that sub-board operating at optimum efficiency" that is restricting the activity of the board too much and I have great difficulty with that.

Mr. Molloy

Deputy Mitchell raised interesting points which might be the subject of consideration on another occasion but they are not strictly relevant to the amendment before us.

I would suggest to Deputy Bruton that it might be a bit reckless to refer to Bord na Móna as being an insolvent company. I reaffirm that their borrowings are guaranteed by the Minister for Finance, and that they are trading successfully. They have financial problems arising from losses incurred as a result of decisions made in the past, principally with regard to capital expenditure. The consultant's report which has been made available to me is being carefully examined in the Department and it is still under consideration. The question of how the board deal with the financial difficulties is being examined. The board had submitted proposals at the request of my Department and these matters are being jointly considered. Appropriate decisions will be made in time.

Deputy Bruton emphasised that the accounts were leaked some time ago, and said that because they were leaked I should have been making decisions about these matters long before now. I am sure the Deputy will appreciate that due and careful consideration is necessary before any decisions are made and that the company have made a major contribution since their accounts were finalised in regard to how they propose to deal with their financial difficulties. This is a matter which is under careful examination in the Department at present. I want to assure the Deputy that appropriate decisions will be made in regard to these serious matters as soon as possible. There is no intention on my part to delay the matter. We should be careful talking about insolvency, particularly when we have a successful company trading in the market-place with a huge number of people employed who depend on the company to trade successfully in the future. They also depend on full support from the Minister and the Government in regard to the company's activities and I assure the House that they certainly have that support.

The provision for setting up sub-boards within Bord na Móna is designed to give the board maximum flexibility in carrying out their functions. I have emphasised that point on a number of occasions. It is considered that the embodiment of the kind of rigid structures for such sub-boards into legislation as suggested by Deputy Bruton would unduly limit this flexibility. The amendment would interfere with the intention of the Bill which is to open up commercial opportunities for Bord na Móna rather than imposing many statutory restrictions on them and interfering with their free operation in the market-place.

Mr. R. Bruton

Could the Minister explain that?

Mr. Carey

It is very difficult to understand

Mr. Molloy

Subsection (2) of the amendment would, in practice, delegate to the auditors of Bord na Móna capital decisions in relation to the apportionment of the board's financial resources. This again would unduly constrain the board in their role of policy formation for the organisation as a whole.

As I explained to the Deputy, the sub-boards are delegated authority by the main board to — in this instance — operate separate divisions or to undertake to examine any particular proposal on behalf of the main board. If, in time, the main board decide that it would be more appropriate to establish separate subsidiary companies to operate these divisions, they have the power to do so under this Bill. In the event of them exercising those powers under section 2 it would be appropriate — indeed they would be obliged under the Companies Act — to present separate accounts. The amendment would introduce restrictions on the company, limit their flexibility and would not be acceptable to me regarding the main thrust of the Bill as it would substantially interfere with it. Therefore, I oppose the amendment.

Mr. Flanagan

We welcomed this legislation when it was introduced but it will be very weak if we do not discuss proper financing and putting the board on a proper footing as far as finance is concerned. The Minister has denied the fact that Bord na Móna are insolvent, nevertheless he cannot escape the reality that the board at present have assets of £100 million and liabilities of £165 million. It would be a profitable organisation making something in the region of £18 million or £20 million per year if it were not for the burden of their enormous debt. There is no better place to address the future financing of Bord na Móna or the circumstances under which they will survive than in the course of this Bill. I ask the Minister, while dealing with this amendment, to address himself to the future financing of the board.

When Deputy Bruton moved the amendment he referred to the recommendations of the National Planning Board in their report of 1984. I refer the Minister to paragraphs 8 (1), (2) and particularly (3) on page 122 of the report. Unless the Government are prepared to give hope to Bord na Móna in this legislation the changes envisaged by the Bill will be far weaker than the Government might anticipate. Bord na Móna have borrowed to the tune of £80 million at extraordinarily high interest rates of 17 per cent, 18 per cent and 19 per cent. This is a burden which they will not be in a position to overcome without a substantial change on the part of the Government. I hope that, before we pass this legislation, the Minister will give serious consideration to how he proposes to place the financial structure of Bord na Móna on a firmer footing than at present.

The Minister talked about allocating the assets and liabilities to the various sub-boards which will be set up. Will the Minister be specific and inform the House how this will operate in practice? Which sub-boards will get the assets and which boards will get the liabilities? How, in effect, will that be addressed? Without dealing with specifics in this regard, we are doing something of a disservice to Bord na Móna because, without proper planning, this legislation will not prove as successful as we had all hoped. There are umpteen precedents available to the Government where boards, similar to Bord na Móna, were under severe financial constraint and where Government packages were put in place. I am not asking that a similar line be taken in regard to Bord na Móna but the serious difficulty should be addressed in some form or other. The Minister tends to place significant store on this consultant's report which he has had for some time and which his departmental officials are considering. When will the consultant's report become public? Is it the Minister's intention to lay it before this House so that Members will have an opportunity of contributing to the future development of Bord na Móna? The most important aspect of this legislation, to promote the board in their activities abroad and to allow them to delegate the functions of the board to sub-boards, will be a husk until we address the very severe financial constraints under which the board operate at present.

Before we leave this amendment the Minister should give us specific information as to how the various actuarial reports will distribute the assets and liabilities of the board — particularly the liabilities — to the various subheads. Will the Minister take my initial point on board? He said that while the board are not insolvent because various loans are guaranteed, nevertheless the reality is that Bord na Móna, irrespective of the sub-boards or how they are dressed up in this legislation, will be severely constrained and burdened because of the massive amounts in terms of interest repayable on an annual basis. A sum of £18 million is repayable each year by Bord na Móna in interest alone. Does the Minister believe that that is a healthy way for the board to operate? Does he see that there is tremendous scope in this legislation to allow Bord na Móna, under the sub-boards, to be masters of their own destiny? How can they do that with this massive debt burden? I ask the Minister to address this matter at the earliest possible opportunity.

Mr. R. Bruton

The Minister made a bit of a meal out of the fact that there had been unauthorised leaks. However, it is up to the Minister to direct the board as to when they will make their accounts available to him. On the Minister's admission the board did not make their accounts for March 1989 available to him until February 1990, 11 months after the date when they were completed. We have not seen them before the Oireachtas. It is the Minister who is neglecting his duties to the House by allowing that to evolve. I do not accept that it is only recently the Minister's attention was drawn to the serious financial difficulties in Bord na Móna. We have all known for a long time of their problems.

The Minister has said that the proposal I have made as to the legislative vehicle by which we could restructure the company would involve too much inflexibility. The Minister has not substantiated that argument. What is being proposed is that the excessive debt should be hived off to a holding company, as was done in the case of NET. That is not something the Government do not know anything about and it has not been argued that it created enormous structural difficulties or constrained the commercial operations of NET as they evolved into a joint venture. The Minister's argument does not stand up.

If the Minister does not go along with the vehicle I have suggested as a way of restructuring the company, and giving their commercial divisions the opportunity to grow, perhaps he will indicate the line of his thinking. What alternative options does he envisage? Does the Minister envisage a simple equity injection into the company? Would he not consider it better to take the opportunity in the Bill before us to put in place a structure which will in the long term give the Government a satisfactory way to allow those commercial operations to grow and flourish? I can see the day dawning, when the Minister has concluded his deliberations and decided on a new approach, when we will have to find time in the House to debate a turf Bill, issue No. 2.

When debating the future of Bord na Móna it would be a shame if the Minister did not tell us the shape he envisages for the future of the board. It is not satisfactory that we should spend one day in the House debating the future and structure of Bord na Móna, the way ahead for the company, in the dark as to how the Minister will get over the number one problem facing the board, their huge debt. No company can grow and develop out of a debt like that which is confronting Bord na Móna. There is no way they will successfully penetrate new markets or develop new products on the basis of debt finance. Unless the Minister faces up to that problem urgently and brings forward new structures along the lines I have suggested Bord na Móna's future will be seriously damaged.

Mr. Carey

I am disappointed at the Minister's response to the amendment. He did not address the difficulties faced by the board or avail of the opportunity to elaborate on his proposals. When the Bill was introduced by the former Minister he made great play of the fact that a committee had been established to look into the financial position of Bord na Móna. The Minister, the Government, and Members of the House, are aware that the State is littered with companies who tried to trade out of difficulties similar to those faced by Bord na Móna. Those concerns have gone to the wall. Employees of the company are operating under great stress because, as Deputy Flanagan said, they must cope with the horrific interest repayments the company are expected to meet. The straight and vertical line approach adopted by the Minister gives the impression that the Department of Finance do not want to let go of Bord na Móna. Their intransigence will, eventually, lead to the downfall of many companies.

It is wrong that the Minister should give an absolute guarantee for loans advanced to Bord na Móna. Why should Ireland Incorporated, the taxpayer, be asked to guarantee such loans? Bad decisions were made. My colleagues on my right, who proclaim a different ideology to me, have told the House that Bord na Móna are a profitable company. Bord na Móna are not a profitable company. The fact is that they cannot trade out of the difficulties they are in. I will be surprised if the Minister in the course of his reply will tell us that he expects the company to trade out of the difficulties they are in without him having to do something to help them. I do not know how the Minister can blandly suggest that Deputy Bruton's amendment seeks to put restrictions on him. The Deputy has asked the Minister to introduce certain standards in Bord na Móna. He wants the Departments of Finance and Energy to look at reality.

If the company were dealing with bank managers in the commercial world and did not have the letters of comfort, the guarantees from the Minister, there would be a run on their assets. I appeal to the Minister to be more specific about the problems of Bord na Móna. He should tell us what he considers to be the alternative to Deputy Bruton's amendment. What does he propose doing about Bord na Móna?

Mr. Molloy

The House is discussing a Bill which, in effect, is an enabling Bill. It proposes to give increased powers to Bord na Móna which will enable them to expand their activities in the market place without the restrictions that exist. It seeks to give Bord na Móna new powers. The Bill is not proposing to deal with the current financial difficulties confronting the board. There is adequate provision under existing legislation, and under the authority of the Minister and the Government, to deal with the problem that has arisen because of bad investment decisions made many years ago and which are coming home to roost on the incumbent in the Office and on the Government. I have given an assurance on a number of occasions that the financial difficulties, which I recognise and which will have an effect on the operations of Bord na Móna in the future, are under careful examination. They will be dealt with in an appropriate way. I see that as a completely separate matter to introducing a Bill which proposes to expand the remit of Bord na Móna, to increase their powers to operate in the commercial sphere at home and abroad.

The House is trying to put structures into place which will enable a more successful, more dynamic and enlarged company to operate in the future. It would not be appropriate for the House to discuss the financial problems that exist. They follow on from decisions made some years ago and they affect the current financial standing of the company. That matter has been reported in the annual accounts and it will be carefully examined. Decisions will be made in regard to that matter and it would be improper of me to go into any detail as to how I propose to deal with it at this stage. It is in order for the Deputies to raise the issue but it would be impossible for me to do so because the matter is being considered and decisions have not been made in relation to it. I can understand why the Deputies opposite are genuinely concerned about the matter and how it might affect the future operation of Bord na Móna. All I can say is that when corporate decisions are made by me and the Government, I will seek to make known those decisions. I am sure Deputies will find other ways in which to comment on whatever decision is made in the Estimates debates or by way of Dáil questions, or, alternatively, if they want to discuss the matter with me, I would be happy to communicate to them any information I can. One must bear in mind that we are talking about a commercial company which is expected to compete with all the other companies that operate in the private sector. Because it is a State company it has its own built in restrictions and certain safeguards. As I have said here on a number of occasions, I am trying to ensure that those restrictions are as limited as possible.

The procedure laid down in this amendment provides for more restrictions which would limit the flexibility of the company. I do not see that this is the appropriate way forward. If Deputy Bruton thinks this is the right way to deal with it and that this is the only way it should be dealt with, and if he wants to press the amendment then we will have a vote on it.

I ask him to accept my good intentions in regard to this matter. I recognise there is a problem in regard to the current accounts and the current financial difficulties, but they will be dealt with in an appropriate manner. We are not yet in a position to state what exactly will be done.

I was asked if the consultant's report would be published. I should like to inform the House that it is not my intention to publish that report because, as has been said before, it contains a great deal of confidential and commercial information. Arrangements are in place to discuss the differences between the consultant's view and those of Bord na Móna arising out of what is contained in the report. The House is aware that many of the consultant's recommendations, including "divisionalisation", are already being implemented by the board. If Deputies require any information in that regard I would be happy to supply it direct. The usefulness of the report would be seriously inhibited if it were to be published. That is a valued judgement I had to make as Minister. I have made that decision and it is not proposed to publish the report.

Mr. Sherlock

As the debate on the amendment hinged on the financing of the board, what relevance do sections 6 and 8, which require the amendment of sections 18 and 59 of the Principal Act, have to the debate? They relate to the capital and revenue account of Bord na Móna.

Mr. R. Bruton

The Minister asked whether I feel this is the only answer to the board's problems. I do not see it as being the only answer but it is an answer which unfortunately we do not have from the Minister. I can appreciate that he is relatively new to the job and has not had the chance to get his thoughts together on this, but this is February 1990 and the accounts that underline the recent problems are a year old. How long does the Minister need to come to a conclusion about the future of Bord na Móna?

When this Bill was introduced in the Dáil in November 1988 we went over the ground thoroughly as to the problems of the board and the unsatisfactory nature of the Government's response. The Minister's party colleague said that what was needed was a fundamental recasting of the legal and capital base of the company. He also said that the Bill represented a no change situation for Bord na Móna. He went on to say that they must be given the right framework within which to operate on a truly competitive basis. That was put forward by Deputy O'Malley in November 1988 on behalf of the Minister's own party.

Now he comes back to the House producing the same style of approach and while I accept that he might have better ideas than my set of proposals as to how this new framework can be given to Bord na Móna, I do not see what he is coming up with. His own party indicated that there was a need for a new legal framework, in other words, it had to be enshrined in this Bill or else we would be coming back with another Bill in a short time. That is the reason I feel we are engaging in something of a sham here today.

The Minister is talking about new rights for the board and new sub-boards. This will be only so many committees in Bord na Móna pushing around paper if the central problem they face, namely, their debt problem, which prevents them from trading commercially and successfully is not addressed. That aspect is very frustrating. I understand that the Minister may not have all the answers yet, but it is frustrating for us to try to look at structures and committees that the Minister feels are appropriate. We do not know what he will do about the central problem which is worrying everybody in Bord na Móna and everyone interested in the development of the energy sector in Ireland.

I will withdraw this amendment and reintroduce it on Report Stage when the Minister will have had an opportunity to consider further the position of Bord na Móna. Like the Minister's former colleague, I feel that what we have here is not enough to deal fundamentally with the problems of Bord na Móna.

Mr. Molloy

The fact that the Bill is being discussed now is coincidental with the fact that the question of dealing with the financial difficulties of Bord na Móna are being considered at present. I can see why Deputies try to marry one with the other and expect to get a solution while this debate is taking place. I should like to inform them that I do not intend to deal with it in that way because it would not be appropriate to deal with it in that manner, in fact, it would be highly improper. The question of the financial difficulties will be dealt with separately.

There is sufficient legislation to enable the Minister and the Government to deal with the difficulties that have arisen and it is not necessary that they would be solved by way of legislation. The reason for the delay in bringing forward last year's accounts has to do with this particular situation and the question of dealing with the financial problems. I would like to assure the House, as far as I can, that in future years the statutory requirement will be complied with in regard to the period within which the accounts should be published. I hope that what has happened in relation to last year's accounts is exceptional. Certainly, the problems thrown up are exceptional but there is adequate provision to deal with them and I hope they will be satisfactorily dealt with soon. Deputy Sherlock raised a point regarding the relevance of sections 6 and 8 which deal with the revenue capital accounts. It merely relates to the presentation of the accounts, but it will come up again later.

Acting Chairman (Mr. M. Barrett)

Is Deputy Bruton pressing the amendment?

Mr. R. Bruton

I am indicating my intention to withdraw it at this stage but I hope to introduce something on the same lines on Report Stage and to hear the evolution of the Minister's thoughts in the meantime.

Mr. Carey

Legislation will be needed if the financial difficulties are to be resolved.

Mr. Molloy

Not necessarily.

Mr. R. Bruton

But there was legislation for NET.

Amendment, by leave, withdrawn.

SECTION 4.

Mr. R. Bruton

I move amendment No. 13:

In page 4, subsection (2), line 6, to delete "the Minister for Finance" and substitute "where the value of the capital funds committed, or the value of any long-term contracts entered into by the Board exceed £10 million, shall be subject to the consent of the Minister for Finance".

This amendment is linked with an earlier amendment which I hope to reintroduce on Report Stage.

Amendment, by leave, withdrawn.

Section 4 agreed to.

Acting Chairman

Amendments Nos. 14, 16, 17 and amendment No. 1 to amendment No. 18 are related. Therefore, it is proposed to take amendments Nos. 14, 16, 17 and amendment No. 1 to amendment No. 18 together. Is that agreed? Agreed.

NEW SECTION.

Mr. Molloy

I move amendment No. 14.

In page 4, before section 5, to insert the following new section:

5. —The Board may, inside or ourside the State, engage in all such commercial activities, whether in relation to the production or marketing of turf or otherwise, as in the opinion of the Board arise out of and can advantageously be conducted in conjunction with any function of the Board.".

This amendment extends the board's remit and allows it to engage in various commercial activities not confined to peat or peat products. The amendment is loosely connected with section 7. Section 17 of the 1946 Act specifies the duties of Bord na Móna, which refer to turf and turf products. The board have contended that to enable them to exercise those non-peat related powers outlined in section 7 of the Bill their duties also need to be broadened. It would not be appropriate to make it a duty of Bord na Móna to engage in non-peat activities, rather this function should be given to the board without there being a specific obligation to exercise it. The amendment is more of a discretionary function but at the same time it satisfies the board's concerns in relation to the extension of their remit. The purpose is to leave it beyond doubt that the board have the authority to exercise those new non-peat related powers specified in section 7. However, the board will be limited in the activities that they may wish to engage in. Such activities are set out in section 7.

Mr. R. Bruton

I support the Minister in this instance. The purpose of my amendment No. 17, is exactly the same as that of the Minister's amendment. The Bill as originally framed would have restricted the board too much in the activities they may engage in. The reality is that Bord na Móna have to consider all sorts of new commercial activities, some of which will be only tangently related to their core peat business. It is only right that we should allow them to expand their commercial activities in the way the Minister has proposed.

Mr. Sherlock

I, too, welcome this amendment. As I said previously, it is great that Bord na Móna are exploring all avenues which could in the long-term prove profitable. In view of the fact that this legislation will enable the board to engage in such activity — I do not want to dwell on the financial problems of the company — is it the intention to increase State equity in Bord na Móna?

Mr. Molloy

As I expected, this amendment has been welcomed. The matter raised by Deputy Sherlock is still under consideration, but it is not appropriate to discuss any matter relating to equity at this time. Decisions will be made on those matters.

Amendment agreed to.

Section 5 agreed to.

SECTION 6.

Mr. R. Bruton

I move amendment No. 14a:

In page 4, between lines 11 and 12 to insert the following subsection:

"(2) Section 18 of the Principal Act is hereby further amended by the insertion of the following subsection after subsection (3):

‘(4) In any event, when the Minister lays a report of the Board before each House of the Oireachtas in accordance with subsection (3), he shall do so not later than six months after the end of the financial year of the Board to which the report relates.'.".

The purpose of this amendment is to deal with the present unsatisfactory position. Almost a year after the end of the financial year we have not yet seen the accounts of Bord na Móna. The 1946 Act places an obligation on the Minister to set the date and the form in which the board will have to present their accounts. It is quite clear that the Minister's predecessors did not bother to set a date by which the board would have to present their accounts. In order to get over this problem and the possible reluctance of some future Minister to have the board present the accounts on time, I suggest that a new subsection (4) be inserted in section 18 of the principal Act which relates to the reporting of information by the board. This would require the Minister and the board to organise their affairs in such a way that the report and financial accounts of the board would be laid before each House of the Oireachtas not later than six months after the end of the financial year to which the report relates. This would be a sensible move on the part of the House. It is a pity that the 1946 Act does not contain such a provision because if it did, things would be a little easier for us now.

Mr. Molloy

It is already a requirement that the reports and accounts of semi-State bodies should be laid before the Houses within six months of the end of the accounting year. The reason for the delay in the presentation of the Bord na Móna accounts arises, as I have explained already, from the present financial position of the company. I understand that no similar provision is in place in relation to other semi-State bodies and, therefore, I would be very reluctant to place a statutory requirement on Bord na Móna. The Deputy's concern about unnecessary delays in the publication of accounts is shared by the Government. There is a requirement on all semi-State bodies to have their accounts completed and available within six months of the end of the accounting year. I can assure the Deputy of the Government's goodwill with regard to this matter.

There was a time when semi-State bodies were not complying with this requirement and it proved necessary for the Government to oblige them to do so. However, it would not be appropriate to make it a statutory requirement at this time. If a similar provision was in place in relation to other companies there would be no reason it should not be applied to Bord na Móna. However, I would rather leave the position as it is as unusual and exceptional circumstances can arise, which proved to be the case this year as the Deputies realise, which may result in the publication of the accounts being delayed for very good reasons.

It would have been inappropriate for the board to rush the accounts while these other matters had to be carefully considered. The fact that there have been leaks about the accounts is an indication in itself that there is a need to carefully consider matters of this kind. I urge the House not to press for a statutory requirement on Bord na Móna only because of the difficulties which can arise from time to time when there is a need for flexibility.

I share the concern that in all cases we should insist that the accounts are made available to the House within a reasonable period, which has been determined by the Government as being six months. I will seek to ensure that Bord na Móna comply with this requirement in the future. They have been unable to do so this year because of the exceptional circumstances.

Mr. Sherlock

Would the Minister explain the intention behind this section which states that "section 18 (3) of the Principal Act is hereby amended by the deletion of the words "capital account, revenue account,"? I support Deputy Bruton's amendment which I think is a reasonable one.

Acting Chairman

We are on amendment No. 14a.

Mr. Sherlock

The Principal Act states that the board shall in each year at such date and in such form as the Minister may direct make a report on its proceedings under the Act during the preceding year, and so on.

Progress reported; Committee to sit again.

Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.