asked the Minister for Labour if, in view of the serious economic threat to Waterford arising from the continuing strike at Waterford Crystal and the statement made yesterday by the company's chief executive that a prolonged strike would damage the company to the point of no return, he intends to use the powers available to him to request the Labour Court to intervene; if he intends to take any other steps to facilitate a solution; and if he will make a statement on the matter.
Private Notice Question. - Waterford Plant Industrial Dispute.
This dispute has resulted in the close-down of one of Ireland's most important manufacturing plants which employs 2,300 people. Waterford Crystal is a famous name both at home and abroad. This company have been in operation for over 40 years.
The company are, however, in serious financial difficulties. The crystal division have lost £60.5 million in the last three years. I think the amount of money involved here cannot be overstressed. In 1989 the crystal division alone lost over £20 million. The only conclusion one can reach from figures of that size is that losses of this magnitude cannot continue. Obviously the whole question of costs has to be addressed if the company are not to close down.
I think all sides should be clear about the realities of this situation and the current dispute. There is a real possibility that the company will cease to operate as presently structured and other drastic options will have to be considered. The wage bill in Waterford Crystal is over £40 million per annum. It is clear that if this spending power is lost it will have a devastating effect on the whole economic structure of the Waterford area. A key factor in relation to Waterford Glass is that labour costs constitute 70 per cent of overall costs.
The dispute which commenced on 5 April was triggered by the withdrawal by the company of so-called bonanza payments. These payments apply to holiday weekends where there is a short working week and affect around 400 cutters. The cost to the company is about £750,000 per annum. The union, the Amalgamated Transport and General Workers' Union, were notified in January 1989 that this payment would have to cease as the company could no longer afford it. The union committee convened a meeting of the workers and, on a show of hands, got a mandate for immediate strike action.
The management and the union cannot agree on the basis for commencing negotiations. Pre-conditions are causing the problem. The management state that they want to sit down with the union without pre-conditions on either side but insist that the decisions taken in relation to the withdrawal of the bonanza payments are irreversible. The union, on the other hand, are insisting on the restoration of these payments before talks can commence. What we have here, therefore, is what is commonly described as a "Mexican stand-off".
The dispute has now lasted three weeks. All the signs — from the attitudes being adopted — are that the dispute could continue for three or even six months. The parties have dug very deep trenches and the warfare has all the signs of a long battle. At the end of the day one thing is certain, both sides will have to commence talking at some stage if Waterford is not to lose its most valuable asset. Therefore I might suggest to both sides that they exercise that option as soon as possible.
The question holding up negotiations is that of bonanza payments which I have already mentioned. In this connection, having studied the matter carefully, I suggest both sides might consider putting the issue of bonanza payments to the end of the negotiating agenda without prejudice to their positions on the issue. This would allow negotiations to commence on other issues with a view to finalising a settlement package. The issue of the bonanza payments could then be dealt with as a final agenda item. In this connection I would point out that the issue of these payments affects one section of the workforce only.
As will be clear from my remarks, I have been keeping in close touch with the situation in Waterford over the last few weeks. I have met the Federation of Irish Employers as well as representatives of the management and union officials. Naturally the Labour Court and its conciliation service are available at all times to help the parties reach an agreement.
I would once again ask the parties to consider their respective positions in the context of my suggestion on the issue of bonanza payments. In my experience of industrial disputes like these, negotiations have to start some time. It is my belief that it would be better to do so now rather than in several months' time when the positions of the parties could be further entrenched and bitterness increased.
I agree with the Minister that discussions to resolve this dispute must start some time; indeed, that is the purpose of my question. Would the Minister not agree that, in the earlier part of his reply, he ignored the background of the major, far-reaching rationalisation programme that has contributed to the magnitude of the losses he has described; that against that background the chairman of the company unprecedentedly admitted that management seriously mishandled the implementation of that programme? In that context, would the Minister agree that extremist statements — such as we have heard from some Members of the Oireachtas — are distinctly unhelpful? Would the Minister comment further on the end of his statement — designed not so much to advise both parties how to conduct negotiations but seeing that such a stand-off exists — and say whether he intends in any way to facilitate, without the imposition of preconditions, talks getting under way as quickly as possible using any of the instruments available to him?
I might deal with the Deputy's last question first. Naturally the services of any or all of the bodies within our control will be used when we consider it useful to do so. That is a matter of timing and for the parties involved. We are keeping in close touch with all sides in that regard including the Congress of Trade Unions, the union involved, management, workers and a number of other interested groups.
With regard to the history I should say that over the last three years Waterford Glass and Crystal division has been one of the files that has not been off my desk, indeed has not been off any Minister's desk since 1970. I thought my reply was sufficiently lengthy. I did not go back over all the major issues that arose over the last 20 years. However, I could go on at some length because I am familiar with all the arguments involved.
As Minister for Labour I am endeavouring to be responsible. Therefore, I will not agree or disagree with Deputy Rabbitte's conclusions other than to make the point that, in any dispute, particularly one that affects a wages bill of £40 million, 2,300 workers and the whole economy of the city of Waterford, or indeed any other city, blood pressure needs to be kept as low as possible. Anything said which raises that blood pressure will be unhelpful. I would rather adhere to the conclusions I have reached and the suggestion I have made. Perhaps everybody could leave aside all of the strong statements being made, examine the issue and reflect positively on the suggestion I have made in response to Deputy Rabbitte.
I take it from his reply the Minister does not intend at this stage to cause the Labour Court to intervene or to facilitate direct discussions taking place without precondition. Would the Minister request his officials to re-evaluate some of his assessment which does not have regard to the fact that the bonanza payments were terminated unilaterally or to the fact that the chairman of the company has admitted that the genesis of much of this problem lies in the mishandling of the extensive rationalisation programme implemented at Waterford Glass?
I am interested in resolving the dispute and contend that the type of comment being made by Deputy Rabbitte will not achieve that purpose.
That disposes of questions for today.