Dáil Éireann debate -
Thursday, 31 May 1990

Vol. 399 No. 5

Fóir Teoranta (Dissolution) Bill, 1990: Second Stage (Resumed).

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

Mr. Rabbitte

When the debate on Second Stage was adjourned I was saying that I had some difficulty with this Bill because I was not entirely enamoured of the operation of Fóir Teoranta at all stages of their history. Therefore, I had some sympathy with the fact that it is proposed that this body be wound up, but I query whether the economy is now in such a robust condition that there is perceived to be no need for any alternative rescue agency.

The Minister dealt with the economic circumstances at the time Fóir Teoranta were established when we were heading towards EC membership, with all the implications of trade barriers coming down, a freer market and a more competitive environment generally. As a result this posed additional stresses and strains for Irish companies not accustomed to performing in the new free market conditions. It was acknowledged in that climate that there was a role for a body such as Fóir Teoranta to tackle genuine ailing companies that, with restructuring, advice and short-term finance, had the capacity to be revived and to continue to provide employment.

I think it was in April, when the Minister first addressed this subject, that he remarked that there was no necessity for State props in the new competitive environment, about which he was in ebullient mood. He detailed in that address, as Deputy Noonan said, the fact that interest rates were the lowest for years, there was unprecedentedly low inflation and investment was available through the BES, all factors that, in the very brief period since this Coalition Government came to power, have dramatically changed. The position regarding low interest rates no longer applies. There have been four increases in interest rates since the Government came to power and there is a very significant difference, of 4 percentage points, between the interest rates obtaining in this country and in the leading economy in the EMS exchange mechanism. Inflation has not been contained and the investment available through the BES has been very seriously curtailed in the Finance Act, 1989, and in the Finance Bill which we passed in the House last week.

In case there is any doubt about this matter, I want to say that I support entirely the limitations imposed on the operation of the BES. In fact, I do not think they went far enough. Some of the abuses of that scheme were scandalous, and that raises very serious questions about the original raison d'etre of that scheme. It seems, when it comes to raising investment capital for industry, that that is too risky a matter for many Irish businessmen, whereas a guaranteed return on projects like some of the so-called tourism-related projects is considered a much safer bet. If one looks at the BES since its establishment, one finds that until such time as the banks came up with ruses which could make investments risk-free the BES was scarcely availed of. It was only when investors could be guaranteed a safe return that they began to put up the money for the kind of projects I have referred to. That raises doubts about the investment culture and entrepreneurial instinct in this economy.

Notwithstanding that, the situation that the Minister adduced as his reasoning for introducing the Bill has completely changed. I wonder whether the initial reasons for Fóir Teoranta coming into existence are not, to some extent, about to be revisited on us in as much as there is some analogy to be drawn between the circumstances facing Irish enterprise at the time of our entry to the common market and the situation we will be faced with after 1992. Projections have been made and commentators have written about there being an expectation that we will, unfortunately, risk further closures and further company failures in the aftermath of 1992. Other commentators say we are now so slimmed down, fit and lean that we can face the free market competition with impunity. I would like to think that is the case but quite frankly I am dubious whether, at least in the initial years following the completion of the free market, some companies that, perhaps in the medium or longer term, would have potential for survival and continued employment, will come under pressure, and that the absence of an alternative mechanism will be regrettable. I hasten to add that it is not my job to come in here and argue for further bankrolling of industrialists, although that is too expansive a term to use for all the people who have availed of the Fóir Teoranta largesse, but I am concerned about the employment that is provided.

I have some quibble with Deputy Noonan's reference to the fact that Fóir Teoranta have been instrumental in saving 40,000 jobs. That is probably an exaggeration but nonetheless from the point of view of protection of employment, they have played some role. I would like the Minister to say if there are estimates for the number of jobs that remain in existence as a result of Fóir Teoranta assistance.

I part company with Fine Gael when it comes to indiscriminate praise of Fóir Teoranta. Deputy Noonan was too undiscriminating in his comments about the performance of Fóir Teoranta and about them not being an easy touch for Irish businessmen. I do not believe that at all stages of their history and in all cases that can be established. To some extent they were seen as an easy touch and as a mechanism for the banks to avoid their social responsibility. Customers who were too much of a risk were pawned off on Fóir Teoranta and the banks did not feel they would come under any pressure as a result. In some cases Fóir Teoranta were used as a milk cow for inefficient businessmen. That is an important point, because successive persons associated with the management and board of Fóir Teoranta have commented that they were often asked to bail out companies whose difficulties were also due to inherent managerial weakness. In my view often it is not a financial problem alone but a question of managerial competence. Perhaps we should look very carefully at whether a system of task forces of experts should be available to provide the necessary managerial competence in such circumstances.

Talking about Fóir Teoranta having been used on occasion as a milk cow by inefficient Irish businessmen, my attention has been drawn to an article as recently as 3 May 1990 in Business & Finance on a company called Manford Clothing. This article illustrates the general point I am trying to make and probably supports the introduction of the Bill for the dissolution of Fóir Teoranta by the Government. The article states:

Manford Clothing & Fashions, the Longford clothing company that went into receivership two weeks ago, received over £1 million in State aid since it began trading in 1980. Of this, £440,000 came from State rescue agency Fóir Teoranta. The Fóir Teoranta investment was approved in the summer of 1985 and was made in September 1985. At this time Noel Hanlon, the owner of Manford Clothing and Fashions was also the chairman of Fóir Teoranta.

A spokesman for Fóir Teoranta says that Hanlon would not have been involved in the discussions on the Manford investment. A close friend and former election agent of Albert Reynolds, who is the local TD for Longford, Hanlon was once one of the biggest employers in the county.

There has been a number of examples of that kind of involvement by the agency. I do not question the statement there which is the reason I put it on the record that Mr. Hanlon would not have been involved in the decision while he was chairman of Fóir Teoranta. It is tempting in a situation such as that where one's own business is involved and one is in such a position because there could be a potential conflict of interest. Generally speaking, Governments of successive colours have been subjected to inordinate pressure from backers of their own political parties to be rescued in circumstances such as I have described in the case of Manford Clothing.

Mention of Mr. Hanlon's stewardship as chairman reminds me of another point, and it is an important one. There was a time when one could get easy access to information about major loans advanced by Fóir Teoranta — perhaps not the minor ones — because they were published annually. Some of the figures I have show that on the capital side the Exchequer advanced £1 million in 1979, £7.9 million in 1980, £3 million in 1981, £14.5 million in 1982, £22 million in 1983, £19 million in 1984 and so on. The point about which I am uneasy is that when Mr. Hanlon took over as chairman in 1982——

An Leas-Cheann Comhairle

Sorry, Deputy I know you are a relatively new Member but there is a custom in the House that when making reference to individuals, reference that might be misconstrued, or where the individual in question might wish, in other circumstances, to defend himself and is not given that opportunity here, Deputies, as far as possible, avoid indulging in such references. Having mentioned that to Deputy Rabbitte I expect he will honour that tradition.

Mr. Rabbitte

I had no intention of breaching that general convention. A number of chairpersons of the authority were referred to during the course of——

An Leas-Cheann Comhairle

Perhaps you could use titles rather than names.

Mr. Rabbitte

It is unfortunate that the chairperson who took over about 1982 put an end to the practice of publishing the major list of beneficiaries annually. It is disquieting that it was from that year on that the amounts advanced jumped dramatically. I instanced £1 million from the Exchequer on the capital side being advanced in 1979, £7.9 million in the following year and £3 million in the following year; then it suddenly jumped to £14.5 million in 1982 and went as high as £22 million in 1983 and remained at a high figure until recently.

It is important that there is public accountability and that the information is easily accessible to the public. I am convinced that part of the motivation behind the Government introducing this Bill is that they are aware, and their officials are aware, that there has been misuse of the Fóir Teoranta facility and that in some cases it was throwing good money after bad. It was, on occasion, used as a milk cow for inefficient business. From that point of view it is difficult to defend its continuation but it does lead one to question whether the economy is now in a sufficiently robust condition to dispense with it entirely.

I support the view that one could not continue indefinitely dishing out enormous sums of money. I presume the £75 million referred to in the Minister's address is roughly the same as my own figure for the end of December 1988 — the deficit at that time on the profit and loss account was £74.9 million. That is a substantial amount of money and I accept that it warrants action by the Government.

I wonder whether it was correct for the Government to proceed with this decision in this manner at a time when it is known that a major review of industrial policy generally is being concluded. The publication of the triennial report on industrial performance is expected within a matter of weeks. Obviously, one cannot discuss the role of Fóir Teoranta or any alternative outside any discussions on a review of industrial strategy. It is remarkable that this would seem to be the second time the Minister for Finance has preempted that review by his colleague, the Minister for Industry and Commerce — he made the decision in the Finance Bill to extend the advantageous tax regime for the manufacturing sector to the year 2010, and now he has made the decision to abolish Fóir Teoranta. One hopes this does not reflect any lack of co-ordination within the Cabinet. One presumes there is close and detailed discussion on it but I would have liked an opportunity to reflect on it to see what shape the new proposals will be concerning future industrial policy.

I think it is evident and accepted by all sides of this House that this is the major debate of the nineties, that the industrial strategy we have followed up to now has been a costly failure and that if we are going to create jobs to tackle our emigration, poverty and unemployment problems we will have to rethink whether we are getting value for the vast amounts of public finance we spend on industrial policy. My party have made what I consider to be a very significant contribution to this debate in a document published earlier this week called Making it Work — A Framework for Industrial Development and have attempted to focus on some of these questions. About £400 million per annum has been spent throughout the eighties on a range of grants and subsidies and an array of State agencies including Fóir Teoranta, that exist for this purpose. That is not to comment on whatever the figure is. There is some dispute about it in terms of tax foregone in the various schemes we have been talking about on the Finance Bill and so on, but in direct contributions it is about £44 million per annum. That is a great deal of money. Are we getting jobs for it? We have over 40,000 people fewer employed in the economy now in the manufacturing sector than we had ten years ago. That seems a very disturbing figure. My view is that the IDA are doing a very good job, but the time has come to have a look at whether they are doing the job they should be doing.

However, the Minister has gone ahead and made this decision and we have now to try to respond to that. He has argued that there is an alternative mechanism available since the decision to abolish Fóir Teoranta and he has pointed to the provision in the present Companies Bill which is the US Chapter 11 type facility. I welcome that. It is a very positive decision by the Government. I am a member of the Special Committee on the Companies Bill and I support this aspect of it. The US Chapter 11 system as it operates in the US has ramifications beyond this point that I would not be so enamoured of, but in so far as there is a facility there to stop cash outflows to creditors where a particular enterprise is genuinely under short-term pressure this is very welcome indeed.

The banks have behaved disgracefully in this respect in the past. They have made some outrageous decisions to pull the plug on enterprises that had considerable medium-term and long-term potential when it seemed that their investment might be at risk. The banks have always moved to look after themselves in matters like this, and if hundreds of people lost their jobs as a result of the bank's decision that never seemed to trouble the banks.

I welcome the examiner mechanism contained in the Companies Bill in terms of preventing for a short period the kind of cash outflows that normally would make a company in the circumstances I have described so vulnerable. However, I have not formed a definite view at this stage as to whether that will be sufficient to cope with the circumstances in the climate post-1992. The Workers' Party in their document, Making it Work — A Framework for Industrial Development, argue very strongly that perhaps instead of doling out grants and subsidies and providing expertise in an array of State agencies, we should consider taking investments or key shareholdings in companies, not just companies in trouble but other companies who are seeking to raise finance so that we could exert some influence on key investment decisions. One of the big problems about the maturing stock of multinationals in this country is that, although they have provided very badly needed jobs, the outflow of capital back to the country of origin is of frightening dimensions, something like £2.4 billion profits in the last year being repatriated. I would like to think the State could take a more interventionist role and be in a position to exert influence over the reinvestment of some of that surplus in the Irish economy. It seems that is one of the areas that should be looked at in the kind of debate we are having now about Fóir Teoranta, or Fóir Teoranta mark 2. I would rather think it would be in a revamp of the total institutional arrangements that are there at the moment that in return for investment to bale out the company who seemed as if they were capable of restructuring themselves, the State would take a stake-holding in that company in the manner I have described. Alternatively — or as well — it would appoint a director or appoint managerial expertise where it is found that the real difficulty is that the managerial competence is not there to run that company productively or efficiently. It seems we would have more control over our future as an economy if we were to take that direction. I hope the House will have an opportunity to discuss this in the not too distant future. I will leave it at that for the moment.

Mr. Roche

As Deputy Rabbitte said, in a sense there is a degree of artificiality about the debate because we are discussing a State organisation who literally have run their course and have been terminated. It is only valid to point out that the circumstances now and the circumstances surrounding the foundation of Fóir Teoranta are very considerably different. Fóir Teoranta were established to deal with a specific set of complex circumstances which faced Irish industry as we went into the EC. The Government of the day correctly anticipated that there would be a major change associated with Ireland's membership of the EC. The nature of Irish business was fundamentally different in the early seventies from the nature of Irish business today. Irish business at that time was predominantly made up of small to medium sized basically family firms, many of them engaged in a very traditional way in manufacture behind very high protective barriers. Those barriers had begun to come down in the previous decade, but the protectionism really collapsed from the early seventies onwards. The Government of the day took the view that the shake-out could not be sustained by many traditional Irish industries and that some form of specific agency was necessary to deal with the problems. Fóir Teoranta came out of that thinking.

This country moved from an era of protectionism to an open economy. There was a specific need for this type of institution since there was a gap in the institutional arrangements at that time. Deputy Rabbitte has pointed out that the section 11-type provisions which are being introduced in the Companies Bill, so painfully being pushed by me, Deputy Rabbitte and a number of other Deputies through a committee of this House, put into place a different institutional and legal framework wherein the type of problem which was previously dealt with by Fóir Teoranta can be dealt with. The Government in the early seventies took the view that there would be pressure on Irish industry in the new environment. It was felt in particular that small and medium traditional Irish firms needed some form of support.

I would agree with one point made by Deputy Rabbitte, although I would not make the same inference. It is a great pity historically that throughout the period of Fóir Teoranta there is not a consistency in the presentation of their accounts. I do not accept that there is a sinister implication to be drawn from this and I am sure Deputy Rabbitte did not mean this. Consistency in these accounts would provide us with a very good yardstick for measuring the type of problem being dealt with by Fóir Teoranta throughout their existence and it would provide an extremely good way of judging in objective terms the relative success of the company in dealing with the problems they faced. The reports covering the five years from 1973 to 1977 show that disbursements totalling in excess of £19 million were made to 261 companies. That represented a very substantial amount of investment. The companies assisted read like a Who's Who of Irish industry of the early seventies. They include companies such as AET, Avoca Mines and Arklow

Pottery. I notice that my own constituency——

Mr. Carey

Wicklow companies.

Mr. Roche

It is an historical fact that a very high proportion of Wicklow industry was assisted but unfortunately it did not survive. The list is contained in the 1976 and later reports and makes very intriguing reading. A couple of County Clare companies are included. Other companies are Athlone Apparel, Ballybay Tanners, Cappancur Joinery and Carrigaline Pottery. The tragedy is that these concerns did not survive even with State assistance.

During the first five years of their operation Fóir Teoranta dealt with a very substantial crisis of transition. While not being unkind to them or their personnel, it must be said that there was not conspicuous success in that period. I would be inclined to the view expressed by Deputy Rabbitte. It is obvious that throughout the period the banks whipped many small firms into Fóir Teoranta. Clearly many of the firms did not have a great chance of success.

One of the problems of having a State company like Fóir Teoranta operating in those circumstances and at that time was that the company could be held hostage to requirements in constituencies and to the wishes of Members of this House. I do not say that to chastise people because if a firm in my constituency had been threatened at that time I, too, would have been clamouring at the door of the relevant Minister. When a company like this, a lender of last resort, is set up under the State umbrella, there is a very great political temptation to beat that Minister about the head if he or she does not assist each and every lame duck in one's constituency. That is something that obviously happened. If we look at the extraordinary long list of companies assisted and go back over the record of this House, it is clear that on every occasion a company found itself in difficulty it was whipped into Fóir Teoranta either by the banks, who were all too anxious then as now to rid themselves of risk, or by people such as ourselves defending constituency interests, without an attempt being made objectively to judge the benefits of Fóir Teoranta's intervention.

The middle years of the company's operation saw a fall off in demand for services. Between 1976 and 1981, for example, 249 firms were assisted and the total funds provided amounted to £27 million. Although the number of firms assisted was in decline throughout the period, there was an increase in the average assistance provided to individual firms. Because of the change in the presentational system it is not possible to comment in as detailed a way on the companies assisted at that time. Working from memory alone, it is obvious that many of the companies went to Fóir Teoranta in extremis and objectively they did not have a long-term chance of survival.

I listened with some interest this morning to Deputy Michael Noonan. I would have to take issue with him on his claim that 40,000 jobs were saved by Fóir Teoranta. If he checks the figures I think he will come to the conclusion that this was the total number of people who were employed by the companies assisted by Fóir Teoranta. I do not think Deputy Noonan would claim that all those companies and all those jobs were saved. Clearly that is not the case. That figure is far in excess of the reality.

The recession of the eighties saw a major upturn in Fóir Teoranta's operations. The accounts for 1982 to 1986 make very interesting reading. It is a pity that we do not have the detail of every company assisted during that period. A good number of Wicklow firms again featured and sadly all too many of them went to the wall. There is an intriguing indication of a litmus of the failure of Government policy during the period. The failure of the then Coalition Government to grapple with the changing circumstances of the Irish economy and in particular to deal with the needs of industry in the light of the harsh economic realities of the day is graphically illustrated in the accounts. In 1983 and 1984 in excess of 90 companies were assisted in each year. That was the highest at any time. In the period 1982-86, 415 firms were assisted by Fóir Teoranta, the highest number in 1983 and it declined in 1985-86. Perhaps this was because there was some improvement in the economy, but if one were cynical one could say it was because the shake-out had occurred wherever it could. Disbursements during that period — this point was made by Deputy Rabbitte — were very high: £14 million in 1982, £23 million in 1983, £90 million in 1984, £21 million in 1985 and the amount was less in 1986. The total disbursements over that period were £90 million, an historically high figure.

One of the very disturbing factors during this period was the accelerated rate of debt write-off by Fóir Teoranta. I do not have the actual figures for the period but my calculations suggest it was well in excess of £50 million. The accounts for 1985 show that in excess of £29 million was written off by Fóir Teoranta. This is a very big measure of failure by any standard and is a clear indication that a large number of companies on the books of Fóir Teoranta were clearly not in a position to be helped. I am not saying that we should not have tried to help those companies, or that if I had been a Member of this House representing a constituency where one of those companies was located, that I would not have tried to help them. As I said, one of the great dangers in having a company like Fóir Teoranta involved in this type of operation is that, in a sense, it is an automatic hostage to fortune; in effect, it is set up to deal with every political crisis which occurs when any company, irrespective of the circumstances, finds itself in difficulties.

Events have changed very considerably since 1986. I should like to take issue with Deputy Rabbitte's interpretation of the present economic circumstances. He suggested that inflation, interest rates and the availability or otherwise of the BES and venture funding was such that one might need to consider a continuation of the life of Fóir Teoranta. I admit to being a little confused as to precisely what the Deputy was saying because he criticised the companies who were assisted by Fóir Teoranta and seemed to favour the termination of Fóir Teoranta, but not quite yet.

Mr. Rabbitte

That was not the case. I was querying whether an alternative might be to consider a stake holding——

Mr. Roche

I do not wish to be contentious——

Mr. Rabbitte

The Deputy cannot avoid it.

Mr. Roche

——but I did not understand the Deputy's argument, and I was here for his entire speech. However, I thank the Deputy very sincerely for his clarification. I note he did not say what kind of institution he would put in place of Fóir Teoranta. However, as I have said I do not want to be argumentative.

I should like to point out to Deputy Rabbitte that when we are talking about, for example, interest rates — it is true that there have been increases in Irish interest rates; anyone who pays a mortgage is abundantly aware of that, and I pay several — we never compare them with those in the Federal Republic of Germany where, incidentally, they have increased more rapidly than ours. It is not valid, as Deputy Rabbitte has attempted to suggest, to compare our interest rates with those in the Federal Republic of Germany because traditionally our interest rates have been compared to those of the UK.

There has been a very dramatic change in this area since 1986 and it would be less than generous of Deputy Rabbitte not to recognise this. Interest rates were at an historic high in 1986 and were four percentage points above the level pertaining in the United Kingdom. This had a material effect on Irish industry. Not alone did it affect the rate of investment, given that there is a common capital market between the two countries, but it also affected the opportunities available to industrialists to make investments. This position has been completely reversed and it would be disingenuous of any Deputy to suggest that this is not the case. The position in relation to interest rates has been completely reversed and our rates are significantly below the UK rates at present.

I note from today's papers that there is a great deal of bullish speculation in the financial markets in Dublin and that the Central Bank will make an announcement regarding a down turn in interest rates in the near future. If this is the case, it will happen a little earlier than I and other academic commentators had anticipated. I anticipated that the rates would be reduced later this year but I would certainly welcome an earlier rather than a later cut. However, the main point is that interest rates are stabilising and we can expect a cut. Regardless of whether they increase or decrease the point is that our interest rates are considerably lower than they were in 1986.

Deputy Rabbitte also suggested that our rate of inflation also had a bearing in this case. The present rate of inflation in Ireland is lower than in the United Kingdom and significantly below the 1986 level. The Deputy was critical of BES funding but the reality is that this funding is still available. The Minister, through his intervention in the recent budget, has made BES funding far more realistic than it ever was.

All the factors which existed when Fóir Teoranta were established are gone — we are now members of the EC; the shake-out has occurred; the demand for Fóir Teoranta's services has collapsed; the industrial environment has changed — it is far more confident now than at any stage during this decade; companies which historically showed weaknesses have either gone to the wall or have weathered the storm; management has improved — I agree with the suggestion that our management has a long way to go yet; and the economy in general has been stabilised because of the steps taken by the Minister. In spite of all that has been said here, Irish industry is far more buoyant now than it ever was.

The reality is that Fóir Teoranta has lived its life and served its purpose and it is now time to move on to a different set of arrangements. That is what the Government are proposing in this Bill. It is right and proper for the Minister to have taken steps to protect the interests of the staff in Fóir Teoranta. I am surprised other Members did not refer to this point. This is a very important element because these people have served the State through a long and difficult period. As I have said, the Bill is a bit of a non-sequitur but nonetheless it deserves support.

Mr. Carey

Fine Gael intend opposing the Second Stage Reading of the Fóir Teoranta (Dissolution) Bill, 1990, mainly because we do not believe that circumstances are right at present to disband this company. While Deputy Roche gave an historical view of his perspective of the Irish economy and the performance of Fóir Teoranta, he gave a limited commentary on what exactly took place during the eighties.

I listened with interest to Deputy Rabbitte's contribution. He said it was difficult to ascertain what kind of loans were given during that period and to which companies they were given. He said it was with regret that he had to make that point. I concur with what he said.

There was a similar situation in the health area and many hospitals were in financial crisis. It occurred to me at that time that the health boards were run by the Fianna Fáil Party. Before the Leas-Cheann Comhairle ably corrected him earlier, Deputy Rabbitte was saying that Fóir Teoranta was also being run by a Fianna Fáil board of directors. I am not saying that Fianna Fáil boards of directors between 1980 and 1982 did not do the thing properly or were not capable of examining fully what was going on. I would say that I recall being over in the seat where Deputy Roche is and the present Minister for Finance being down here when certain companies in his own constituency were in difficulty. He was exorting the then Minister for Industry and Commerce to get Fóir Teoranta to rescue them and he was all on for it and there was plenty of money spent on rescuing companies.

Mr. A. Reynolds

You never saw that in the record of Dáil Éireann.

Mr. Carey

The principal party in this Coalition Government——

Mr. N. Treacy

In this country, the Deputy means.

Mr. Carey

——were very skilful in being all things to all people. They were spending money then as if it was manna from Heaven. Deputy Roche talks about the slimmed down position of the Irish economy; he is saying that Irish industry is so lean and so fit that there will be an absolute lift in the economy, that there will be no difficulty and no need to rescue a company.

(Interruptions.)

An Leas-Cheann Comhairle

Deputy Carey, without interruption, please. I suggest to the Deputy that he exercise a little less provocative charm on the people opposite.

Mr. Browne

(Carlow-Kilkenny): That, a Leas-Cheann Comhairle, is oxymoron.

Mr. Carey

I did not interrupt Deputy Roche and I enjoyed his contribution because he told half the story. I want to tell the other half so that we will have the full story.

Mr. Rabbitte

I am not leaving out of any disrespect for Deputy Carey. I shall be back within minutes.

Mr. Carey

I know the Deputy is not. In all fairness, for the Minister for Finance and Deputy Roche to tell us that there will not be difficulties for companies and that companies will not need assistance in the coming years, is beyond comprehension.

Mr. Roche

We did not say that.

Mr. Carey

If the Minister for Finance has any doubt about the problems we are to face and feels that this new concept that the Minister for Industry and Commerce has introduced in the Companies Bill, this mighty man, the examiner, will take us out of all these difficulties, he should listen to the replies that the Minister for Industry and Commerce gives us when we ask questions on that Companies Bill in Setanta House every week. I do not believe the examiner will be in place for the next three years. Will he ever be in place? The Minister refuses to describe him and we do not even know what powers he will have. It will be another hotch potch. At least Fóir Teoranta as it exists at present will be able to give some assistance. I would appeal to the Minister not to be in such a rush. The Minister is good at timing and he sees his political future in front of him and wants to do the thing right.

Mr. N. Treacy

And yours.

Mr. Carey

Mine as well. Occasionally a company will go to the wall and will need assistance so from that point of view the introduction of this Bill is timely but I would appeal to the Minister not to proceed with it until the Report Stage of the exhaustive Companies (No. 2) Bill, 1987 is through the House.

I recall the trauma and distress caused during the eighties by companies closing. There were large sums spent by Fóir Teoranta in trying to rescue the companies and they failed, but at least the State made an effort and all the parties in this House would show a little compassion when the State was needed to give at least a little aid.

Deputy Roche is very critical of the early stages of Fóir Teoranta. Some of the guidelines that were set for Fóir Teoranta at that time in relation to giving out money were very restrictive. They would not release one penny if they could possibly avoid it, the guidelines were so severe. They were so restrictive it was unbelievable. Then the matter was opened up in 1982. The present Minister for Finance was the Minister for Industry and Commerce at that time. The guidelines for Fóir Teoranta were expanded considerably then. If Deputy Roche is decrying the fact that substantial funds were spent during the eighties I can tell him that one of the people who took part in that was Minister Reynolds as Minister for Industry and Commerce because he was most anxious to see these companies rescued. So were we all. We all wanted to see employment maintained. We had different problems in different constituencies. There was the other aspect to what Fóir Teoranta did while it was in existence. I was very disappointed at the way an able Deputy like Deputy Roche could skid over this thing as if there was not good reason for the decisions that were taken in order to assist companies.

I am really disappointed that the Minister has proceeded with this Bill. I have to conclude as well, because the Minister pushed this Bill so often — four or five times recently — that there does not seem to be any consultation between the Minister and the Department of Industry and Commerce or the Minister, Deputy O'Malley, from that other party. If there really was co-ordination between him and the Minister here certainly this Fóir Teoranta Bill would not be at the advanced stage it is at now. It is time the Minister went back and asked the Minister for Industry and Commerce if he is serious about passing the Companies Bill or if he is to continue instructing his officials to put more and more amendments in to prevent one rescue agency following another.

(Interruptions.)

Mr. Carey

This Minister has patience and long-term patience, too. He is a man with ambition, a good man. He has prospects. He is an optimist. He believes in the future. In this instance he would have a great out if he pursued the Department of Industry and Commerce in the way in which they are dealing particularly with Opposition commentary on Committee Stage of the Companies Bill.

The Minister referred to the need to prepare Irish Industry to meet the challenges of the more competitive regime which will apply when the internal market is in place after 1992. Is that not going to mean tax harmonisation? Is it not going to mean VAT harmonisation? Is it not going to mean quite a change in a range of conditions of industrial companies? Is it not going to be the case that we will have problems? Is the Minister going to leave Irish industry with their hands behind their backs? Is he saying that there is not to be anywhere companies that need assistance can go? They will come to the Minister's door to ask what he can do for them and he will tell them to go down the road to the Department of Industry and Commerce and that Minister O'Malley will look after them, that he has a fellow called the examiner but they will find that he is not in place.

Mr. A. Reynolds

That is good stuff.

Mr. Carey

It is not good stuff at all. The time is almost exhausted. I suggest we come back to this another day.

Debate adjourned.