Vol. 406 No. 4
I move amendment No. 1:
In page 2, to delete lines 25 to 29 and substitute the following:
"(2) (a) The Minister shall at all times maintain his equity holding in the Holding Company at at least 45 per cent of the total equitable shares of that Company.
(b) The Minister shall retain 10 per cent of the equity shares for the Beet Growers and for the employees of the Company.".
To get the ground rules right, I presume we are taking amendments only at this stage rather than sections.
We take the amendments as they appear here. I would remind the House that it is only the mover of the amendment who has the right to reply. Every other Member is confined to one contribution.
I have no amendment down to section 1 but I want to put a query to the Minister which he could perhaps answer in a sentence.
This is Report Stage and we can address ourselves only to amendments before us. That governs the section that will be discussed.
Something came up on Committee Stage that did not arise on Second Stage and I thought we could raise it with the Minister.
I do not want to give the Deputy bad thoughts.
I do not entertain bad thoughts.
Perhaps in addressing his amendment the Deputy would put himself in order.
I will endeavour to use all my skills in doing so. In putting forward this amendment on Report Stage it was suggested to me that perhaps it would not be allowed by the Ceann Comhairle's office, but I am glad that was not the case. I put down an amendment on Committee Stage proposing that the Minister hold 51 per cent of the shares in perpetuity for the State, thereby ensuring that control of the company on voting rights etc. would be held by the State and that the amount of the shares that would be available for sale on the Stock Exchange, the Minister would have in the region of 30 per cent. The Minister has said he expects that his holding will commence at 45 per cent and that he will retain 10 per cent of the equity shares for the workers and the beet growers. I am concerned about the Minister's statement that the 45 per cent of shares held by him could in the future be sold on the Stock Exchange or to private individuals. That simply means that this company can be sold to the extent of 90 per cent of its share valuation.
All through the debate the Minister has maintained very strongly that this company are not being privatised, that they are being part privatised. Therefore, it is with some interest that a company union agreement which has been ratified by the Labour Court has as its draft heading "Company-Union agreement concerning terms and conditions on privatisation of the Irish Sugar Company." This agreement does not refer to part privatisation; it refers to privatisation. We should establish quite clearly at this stage that this company are being privatised.
My purpose in putting down this amendment is to ask the Minister, since I failed to persuade him to hold 51 per cent of the shares in perpetuity, to reconsider and give thought to the 45 per cent holding.
We have argued our case for retaining the company in public ownership to the greatest extent possible. I had argued on Second Stage and on Committee Stage that there should be no privatisation whatsoever but, accepting the reality of the situation in this House and the obvious co-operation between the two main parties, the Bill will be carried by a very large majority. I am taking this last opportunity to ask the Minister to hold at least 45 per cent of the shares. Obviously, if the workers and the beet growers held another 10 per cent of the company it would go, to some extent, towards controlling the company with the people who are directly interested in maintaining what has been a very successful company over the years.
My proposition at (b) in the initial amendment asks the Minister to retain 10 per cent of the equity shares for beet growers and employees of the company. Perhaps we did not pursue the Minister in regard to retention of the shares for beet growers and workers; we should have questioned him about the rules he will lay down for the holding of these shares. Will the beet grower, an employee or ex-employee of the company who holds the shares only be allowed to sell them to someone who grows beet for the company or will he be able, like anyone else who holds shares through the Stock Exchange, to sell them to anybody who is interested? That point should be cleared up before we proceed.
I maintain my position of opposing any kind of privatisation for this company; I would have preferred it to remain as it was. However, having failed in that, I asked for a substantial holding of shares by the Minister so that the control would remain within the State, through the Minister. Having lost on both those counts, I ask the Minister to hold the 45 per cent shares and to maintain them in his hands — or in the hands of the Minister for Finance — for the country. The 10 per cent share should be maintained by growers and employees and controlled by them. That is the purpose of my amendment and I hope it commends itself to the Minister.
I do not have any hang-ups about the retention by the Minister for Finance of 45 per cent of shares in the company. On Committee Stage, the Minister told us that the Minister for Finance would retain 45 per cent for at least two years and that he would have the option thereafter to scale down his holding. In addition, the beet growers and the employees of the company — at the request of Deputy Lowry — were hoping that workers who had been made redundant by the company in recent years would be allowed a certain number of shares. The Minister has not clarified what percentage of the shares will go to the workforce, to those who have been made redundant and the growers. Will he give us a breakdown of the various percentages involved?
I should also like to raise a point which was brought to my notice by a beet grower during the past week; he maintained that, if he bought shares in the company when they were offered to him, he would not be able to sell them for at least two years in line with what is being proposed by the Minister for Finance. Will the Minister say whether that is correct? It is a serious inhibition if people must hold on to those shares for at least two years, particularly when many of them will have to borrow the money to purchase them. It may not be worth their while to buy shares which they will have to retain for at least two years. That seems unfair, it does not make sense. Perhaps the Minister will clarify the situation for workers and beet growers.
The other point I have been asked to raise in relation to the holding company is about the board which the Minister will initially set up. I believe there will be nine directors. How will they be selected? For what length is their term of office? Will it just be for one year until the first AGM of the new holding company? What arrangements are being made for the initial board? Do the present board carry on for one year until the first AGM of the company?
I support the amendment although, as the House is aware, my party are opposed — as well as the vast majority of workers in the Irish Sugar Company — to privatisation. There is no point in talking about privatisation in whole or in part; it is privatisation of the Irish Sugar Company, it is selling the State owned Irish Sugar Company and it is the first of the Government's major privatisation operations.
Sugar manufacture is the principal asset of the company and the regulations at present allow the company to produce and sell sugar at a higher rate than it costs on the world market. We are now privatising the company and giving the majority shareholding to the financial institutions to whom we are selling it. What will be the motivation of the company then? Profit, of course. If they can import sugar more cheaply I am quite sure that they will, without any regard to the livelihood of the workforce.
When we debated this issue earlier the Fine Gael Party referred to the question of capital investment. However, the capital invested in the company was at the expense of the workers, there is no doubt about that, the capital was invested but the workforce were reduced from over 3,000 to 1,500. I do not know if Deputy Deasy knows that the State investment from 1933 to 30 September 1982 amounted to £5.6 million. Of course, the company had many subsidiaries and we are now talking about the 45 per cent shareholding. The Leader of Fine Gael asked if that would restrict people who might be interested in investing their money, he was concerned that the Minister, acting on behalf of the State, could retain 45 per cent of the shares for two years. I disagree with that point in the amendment because the 15 per cent given to the workers will be divided between the workers and the growers. I am surprised that there has been no word, good, bad or indifferent, from the beet growers in this matter although I understand they are involved in talks with the company at present on the issue of the efficiency measures which were introduced in the sugar factory in Mallow where the ionised system was introduced. That brought about a greater sugar extraction and, consequently the BGA wanted their share of that, maybe rightly. When it comes to dealing with a finance company who will be the big shareholders in the sugar industry the door will not be so readily open to them and they ought to be very well aware of that. Now we are talking about amendments to the Bill on Report Stage but the most frightening thing that has come to light is the memorandum and articles of association of the holding company. Why are Members who are interested in this not given a copy of the memorandum and articles of association? Why is this not the subject of debate at this time? There are regulations in that voluminous document.
Deputy Rabbitte had a copy here last night.
I have extracts from it, but it has not been distributed.
It is in the Library.
The regulations should be the subject of a debate. There is no point in enacting legislation and putting forward and debating amendments when the memorandum and articles of association have far-reaching consequences for everybody. The amendment suggests that the Minister retain at all times the equity holding of the company, at least 45 per cent, and the Minister retain 10 per cent for growers and employees. I understand the employees were told it would be 15 per cent. Will the Minister in his reply tell us what is contained in the memorandum and articles of association relative to this section? That might be the best way for us to get the required information.
(Carlow-Kilkenny): Will the Minister clarify the phrase, ghost sugar? It concerns the benefits the growers will get and it is important if the company are making £6.5 million from that extraction from the crown of beet——
Extra money.
(Carlow-Kilkenny): It is money for nothing because technically it does not exist. The growers are looking for £2.5 million, a reasonable request, and it is important that this is clarified before it goes into another holding company.
A number of the points raised are not relevant to this amendment which I understand, under the procedure of the House, is what I am to address myself to. With due reference to Deputy Browne, the last point he raised is totally irrelevant to the issue we are dealing with here and I cannot be expected to respond to that, though I did yesterday.
(Carlow-Kilkenny): The Minister did not.
I want to indicate why I cannot accept the amendment and I hope when I explain why, Deputies will not only understand but support my reasons. First, if I were to accept Deputy Kavanagh's amendment it would mean that as Minister for Agriculture and Food I would have no special share because the amendment provides that the Minister — meaning the Minister for Finance — shall at all times maintain his equity holding in the holding company of at least 45 per cent of the total equitable shares of that company. That would mean that any share in excess of that would be excluded. The special share to which all of the crucial rights attach, and the protections for workers and sugar quota, and the protection of this vital national asset, could not be put in operation if Deputy Kavanagh's amendment were put in place. For that reason if for no other I will not accept this amendment.
There are other cogent reasons. The second point is that he proposes that a 45 per cent holding be maintained by the State in the company. Deputy Deasy is quite right. I indicated on Committee Stage, and I want to confirm formally, that the Minister for Finance will maintain for at least two years the 45 per cent shareholding in the company. The Minister for Finance will confirm that on the flotation which is the appropriate time to do so. In that instance this is a clear signal to the markets. It is very important that we do not tie ourselves down to a specific figure in legislation one way or the other. That matter will be confirmed on the flotation by the Minister for Finance, but if the flotation is to proceed successfully investors must be confident that the company can operate on a fully commercial basis and in accordance with the dictates of the financial market. This is a vital element in the dynamic we want to see this company develop.
The major concern which everyone will want to share is that the company would maximise their value to the benefit of the Exchequer which means, ultimately, the taxpayer and, of course, in the interests of the workers and the beet growers. Securing a good price for the State's shares and enhancing the future of the company are the best means of ensuring value for the taxpayer. Everyone is concerned for the taxpayer. I do not think any Member, from whatever side of the ideological divide he comes, would say that what we should do here is heap extra cost on the taxpayer. Rather, all of us are agreed that we should minimise the burden on the taxpayer. Quite often the criticism in this House over the years has been that our taxpayers are too heavily penalised. The taxpayer has contributed £66.5 million to Siúicre Éireann but £59 million of that was contributed in the eighties. That was £59 million of workers' tax, employers' tax, general taxpayers——
The Minister is making a mistake. He should check the record. There were no amendments until 1982.
I am telling the Deputy what was contributed during the eighties. That is fact. The Deputy can check the record and he will find that to be the case. It is essential to get a return on this investment. The taxpayer is entitled to that and the best means of doing so is through a sale of portion of the shareholding, which is what we are doing now. If Deputy Sherlock wants to persist in the notion that the total shareholding is being disposed of he is free to do so.
Sir——
You will have noted. a Leas-Cheann Comhairle, that I did not interrupt Deputy Sherlock even when he strayed to issues that were in no way relevant to the amendment we are discussing. I am entitled to the same courtesy from him.
The Minister is doctoring the facts.
Deputy Sherlock is usually a well behaved Deputy and will be so now. On Report Stage he is not allowed to make a second contribution. The Minister should be allowed continue without interruption.
The important thing is that the residual 45 per cent shareholding, provided the company are successful and eveyone's intention is that they will, with a new dynamic opportunity, yield not only profit to the company but profit to the taxpayer, the workers and the beet growers who will, of course, have their own equity in the company under this new arrangement. Of course, like other shares in any successful company, those shares will appreciate in value over time and a better dividend could be expected, which is really what we want to achieve for the workers, the beet growers and the company. Of course, we want a proper return for the first time for the taxpayer because no dividend has ever been paid to the taxpayer from this company.
That is not correct.
When I say "ever", let me say for a very considerable time.
That is not correct.
The regulations of the company prevent dividends being paid while the company are incurring a loss. It has been agreed in principle with the company to make a specific block of shares available to employees and beet growers. On my recommendation the Government adopted the proposition that in addition to the 45 per cent which the Minister for Finance will hold there would be an equity participation at preferential rates of 10 per cent for workers and beet growers. An additional 5 per cent will be reserved, but not at a preferential rate, for beet growers if they wish to acquire them. These shares are available either on a preferential basis or on the market in relation to the second 5 per cent. I have neither the wish nor the right to force workers to take up equity at preferential prices if they do not wish to do so, but I am confident that they will. I went through all of this the last day in relation to the loans being made available to the workers to acquire shares at discount rates. Adding the shares which the Minister for Finance holds to the 10 per cent and the 5 per cent gives a total of 60 per cent. In the light of that how can Deputy Sherlock say that the total shareholding here will be acquired by the private sector?
Can the Minister give a breakdown of the 10 per cent?
As far as I understand it at the moment this is subject to consultation. There are special reduced rates and loans available to the workers to acquire 4 per cent for them and 6 per cent for the beet growers.
Do the growers have to hold on to the shares for two years?
I would not want to put a restraint on free sale but by holding the shares for two years the growers will not be charged on the discount rate of 20 per cent for tax. That relates to tax law. It is not a condition laid down by me. If they do not wish to benefit from the discount rate they are free to sell the shares. When people make their calculations they will find that they will benefit financially from holding the shares for two years.
On Committee Stage Deputy Lowry referred to redundant workers and other former employees. In consultation with the unions the company concluded that it would not be acceptable or in the workers' interest to diminish their shareholding by making shares available to former employees whether on pension or on redundancy. This issue is not relevant to this section but I am sure that the total number involved is of the order of 2,000. The number who would qualify under retirement or redundancy would be in excess of 4,000. It would be more than those who would be entitled to the special placing and the preferential rates. There are 1,000 former employees on pension, or with a vested pension and it is estimated that an additional 1,000 people have left and have effectively cashed in their pension entitlements. I do not have the redundancy figures but they are considerable. Between redundancy and retirement the figure would be considerably in excess of the numbers currently employed with the Sugar Company.
With regard to putting a restriction on the sale of shares by either the workers or the growers, the Stock Exchange rules do not permit a restriction on the sale of shares. The Minister must accept that, discipline himself and that is why he must make that statement in the prospectus at the time, so that the world at large and the markets are aware that the Ministerial shares will remain for at least two years at 45 per cent. They have to be satisfied about that but we cannot restrict the fundamental right of workers to sell their shares. Such a restriction would be contrary to the Constitution and it would be held to discriminate against workers where others are free to sell shares. The same would be held in respect of the shares held by beet growers who are getting their shares now because of their right under current contributions and partnerships. I would be amazed that anyone here would suggest that growers alone of all who might acquire shares with the new company should be prevented from disposing of them to their advantage.
On the last day I undertook to consider the point in relation to former employees. When I get the figures at the end of this discussion, the Deputies will see why it would not have been possible to accommodate them without diminishing the equity participation for the beet growers and the workers, which is something that nobody would wish. Clearly former employees can apply for shares on the Stock Exchange and I would be happy to think that they would. The indications on the market show that this will be a very profitable venture and nothing would make me happier than to see former employees sharing in that profit like everybody else.
On a point of information——
With your indulgence, I would like to call on Deputy Garland who has not spoken. I will then call on Deputy Kavanagh to conclude. Perhaps Deputy Kavanagh could put his point but we have to restrict ourselves to the requirements of a Report Stage debate; otherwise we would have another Second Stage debate.
On behalf of the Green Party I formally support this amendment which, as Deputy Kavanagh has admitted, does not go far enough. Moreover, the Labour Party, like ourselves, do not agree with even the partial privatisation of this company for the reasons I gave on Second and Committee Stages. I can only reiterate our total opposition to the Bill and, hence, my support for the amendment.
I cannot agree with Deputy Kavanagh's amendment which proposes that the Minister should maintain his equity holding at at least 45 per cent which would mean that the major portion of the equity would be held by the State. We are talking here about a company which is capital intensive and needs substantial amounts of capital if it is to survive in the marketplace. They have been returned to profitability in recent years and have substantially reduced their borrowings. According to the records for the five year period 1986-90, finance costs have been reduced by one third. The figure for 1986 stood at £11.2 million while in 1990 it was reduced to £4.7 million. This represented a significant breakthrough for the company, in terms of profits retained and injections of State equity. As the Minister said, in 1982 £30 million in equity was injected into the company, while £20 million was injected in 1983 and £9 million in 1987 giving a total of £65.5 million. There have been no further State injections of equity since then.
Despite this the company have been returned to profitability through good and prudent financial management. The company have also acquired share-holdings in other concerns in an effort to give the State a major stake in the food industry. If the company are to grow they will have to move away from the domestic market and seek markets in the United Kingdom and Europe. If they fail to do this I do not see a great future for them.
I understand 10 per cent of the equity shares of the company will be made available to the workers and growers. I do not know how this figure will be broken down. Neither do I know at what price these shares will be issued, but I believe the institutions, which will acquire a significant bloc of shares will have a say on what the price should be on the day of issue. I also do not know the value of the total share capital will be as this will be a matter for the markets. Given the embargo on the sale of discounted shares, I am glad those who purchase these shares, namely the workers and growers, will be protected. I am glad that the embargo will not apply in cases of hardship and that people will be able to dispose of their shares. As I understand it, this equity will be held in trust by the trustees of Greencore to ensure protection for those who invest.
Side by side with this, further shares will be issued and will be available to both workers and growers at a preferential price. I would like to see both the workers and growers taking up as many of these shares as possible. In recent years when co-operatives were floated on the market farmer-suppliers did not take up their full allocation and it was left to the financial institutions and the people in other walks of life to take up the balance. I foresee growth in investment and a substantial dividend being paid. This augurs well for the future of the company. We will, of course, also have the reserve share——
Deputy O'Keeffe should confine himself to the amendment.
I am speaking to the amendment which related to the equity shares of the company. I believe that the reserve share will command a very strong price as they will not be affected by the embargo on the sale of shares.
I would like to ask the Minister three questions. First, what is the defintion of "professional share" and how will the cost compare to the market price of the normal share? Second, I was disappointed to hear the Minister say that former or redundant workers cannot be looked after. It was never my intention that they would be looked after at the expense of existing workers, but I had hoped that an increased number of preferential shares would be made available to them by the company who I expected would have an interest in ensuring that their former workers, in particular those who were retired prematurely or who were made redundant, are looked after. Third, as I understand it, each worker will get shares to the value of £250. Can the Minister tell the House if these shares will be taxable? If they are, their value will be automatically reduced by approximately 50 per cent, or will it be the case that if they hold them for two years they will no longer be taxable?
Unfortunately, under Standing Orders the Minister is no different from anybody else and he has made his contribution. Perhaps he should make his contribution when the other Deputies have concluded. If the House is agreeable once Deputy Kavanagh has concluded as an exception, and since Deputies did not understand fully the rules governing amendment on Report Stage, perhaps we could accept one specific question from Deputy Lowry to the Minister.
I thought for one moment the Minister was going to kick Deputy O'Keeffe in the leg and tell him to stop making the case for me. In his contribution Deputy O'Keeffe indicated what has happened in the company during the past few years and outlined the profits made and retained by them. I agree with him. I have never said from these benches that they are not a successful company. Indeed, they are a wonderful company and will prosper in the future. I have always maintained, however, that the company do not need to be privatised to be successful or to do all the things the Minister and the Deputy have told us can only be done if the company are privatised. I want it clearly understood that the company have a very bright future.
The Minister is not willing to accept my amendment because, first, a golden share would not be available and the maximum benefit will not be gained if the Minister for Finance is allowed to hold a certain proportion of the shares indefinitely. I do not accept that. There are several reasons the company will be successfully floated. The primary reason is that the company has a most valuable asset in the sugar quota, which will be of particular interest to investors. The other reasons are the level of profit growth and sales growth. As a result there will be capital growth in the shares and dividends will be available in the future. The company will be attractive to the people who are putting great pressure on the Government to have this Bill put through the House with such great haste.
Had the Minister adopted my proposal, he or the Minister for Finance would have a special holding of 45 per cent of the shares. That shareholding could not be attacked by private shareholders because institutional investors cannot hold more than 15 per cent of the shares. That would have been a far greater guarantee than the special shares in which the Minister puts so much trust. The Bill as it stood on Second Stage provided that this special share could be sold. The only major change we have achieved has been in securing the Minister's agreement not to allow his special share to be sold. That was the great worry in special share operations in Great Britain. Of course the Minister or one of his successors could in the future bring in a Bill to change the provision. Nevertheless we have had some success.
I put down an amendment providing that the growers and workers should have a 10 per cent shareholding. I did not indicate whether I was referring to present workers, former workers or redundant workers. I would hope that all those categories would be entitled to shares and would not be excluded simply because they were made redundant due to rationalisation at Thurles or Tuam. They are just as entitled as the current employees to purchase these preferential shares. Many employers believe that 15 per cent of the equity is being retained for them rather than 10 per cent. The Minister mentioned 10 per cent and I should not like to think he told the workers 15 per cent would be available and then changed the amount to 10 per cent. My original amendment specified 15 per cent because I believed that was the amount being retained.
I hope the arguments we have put forward will get through to the Minister. There are legitimate concerns about the memorandum and articles of association which are in draft form. The Minister must look carefully at this matter. The special share and the articles of association represent a means by which the Minister can retain some control of the company. The Minister has not argued that 45 per cent of the shares will not allow him to have the same control as a 1 per cent special share. I maintain that 45 per cent would be a far greater control. The 10 per cent of the equity held by the growers and employees would be an added control.
I hope we can specify the name of the company in the Bill. A name was included on Second Stage which has had to be changed. We should, however, know the name of the company we are talking about.
If the Chair indicates that on this occasion I may reply to a point made, I am prepared to do so. I presume that from now on we will adhere to the procedure of Report Stage.
The Chair is very reluctant to depart from what is fixed. He gets poor thanks for it. I did detect a little uncertainty about Standing Orders governing Report Stage. In those circumstances I think the House might agree as an exception to tolerate a point of clarification. It will not happen again.
I thank the Chair. The amendment refers to "employees of the company". The document on privatisation which issued to employees stated that details would be posted to "each qualifying employee". Will the Minister clarify the position of those who have retired or been made redundant?
I am happy to be able to reply to the points made. As of now, £250 worth of shares will be made available to each employee. That will be taxable. Some discussions are still going on and all I can say is that this is the least the workers will get. It is possible there may be an improvement but I cannot give any firm undertaking. The House will understand the reason. The employees will have further shares up to 4 per cent of the company at a 20 per cent discount. Growers will have 6 per cent at a discount of 20 per cent, with the possibility of a right to acquire a further 5 per cent at no discount. I hope I have made that clear and that there is no doubt at all at this point.
With regard to former employees, pensioners and others, let me confirm, in the first instance, because I was prepared to deal with this on Committee Stage, that the total number of current employees in the Sugar Company is 1,756; the number of former employees, and this is not quite as precise a figure, is approximately 2,050. The Stock Exchange are firmly opposed to giving preferential rights to anyone other than employees. It was quite a major concession on the part of the Stock Exchange to extend the arrangements for preferential shares to growers. The rules and practices of the Stock Exchange make it clear that they are not agreeable to extending preferential shares to former employers. The Stock Exchange are basically opposed to issuing shares at different prices — this is the basis on which they operate — to people who are not directly employed in a company. That has been the long established position of the Stock Exchange, and they do not wish to depart from it.
I understand the reasons put forward by Deputy Lowry and I think he will understand from my response to his suggestions that I share his concern in respect of former employees and redundant workers, but we are all faced with that fact. May I point out that any extension of preferential arrangements would, in the first instance, have to cater for current temporary employees, who are not included in the figure I gave for current employees of 1,756, who will have preferential treatment?
Those included in the category of former employees are those who left on pension; those who voluntarily left the company and may be in receipt of a pension or may have a vested pension; those who were made redundant and who opted to retain a vested pension, and those who were made redundant and who opted not to have a vested pension. The latter would be mainly manual employees.
I think I have clarified the issue Deputy Lowry raised. I hope this confirms the reasons why I cannot accept the amendment in Deputy Kavanagh's name.
Let us now proceed to amendment No. 1 (a) in the name of Deputy Sherlock. I observe that amendment No.2 in the name of Deputy Kavanagh is related. I suggest we discuss amendments Nos. 1 (a) and 2 together. Is that agreed? Agreed.
I move amendment No. 1a:
In page 3, between lines 31 and 32, to insert the following:
"3.—Until such time as the scales of pay and the terms and conditions of employment and any other benefits, including rights and privileges, obligations and any other arrangement applying to employees so transferred are varied resultant from negotiations with the trade unions or staff associations concerned, the conditions which prior to the transfer had been negotiated on their behalf and applying at the time of the transfer, shall continue to apply to them save in accordance with a collective agreement negotiated with the trade unions or staff associations representing such employees.".
When the Minister was speaking yesterday evening he quoted from a document which purported to be an agreement drawn up between the company and the unions. I would like to point out the shortcomings in that agreement in as far as the likelihood is that this very evening this Bill will pass and the Irish Sugar Company will be no more. The agreement referred to by the Minister stipulated: company union agreement concerning terms and conditions of privatisation of Irish Sugar cpt. What can be the validity of that document in the future when the company that reached that agreement with the unions will not exist after this evening? It was said that there would be no interruption in continuity of employment, that current rates of pay and conditions of employment would continue to apply and that the company would continue to recognise the existing trade unions. May I ask which company will continue to recognise the existing trade unions?
We are passing a Bill which will be enacted into law. Based on the agreement reached in that document presented by the Minister we must now ask if it is worth the paper on which it is written?
How can the Irish Sugar Company — that will no longer exist — stand over that agreement? How can one legislate for conditions affecting the contracts of employment between the new holding company and their employees since each contract of employment is one entered into between each individual employee and the employer, in this case, Greencore and their employees? What will happen will be that management and staff at all levels will be asked to accept a new contract of employment. I hope it is understood that is precisely what will happen.
Consequently it is most desirable that my amendment be inserted in the Bill as being the only way in which to give effect to the demands and desires of employees of the Irish Sugar Company. Once inserted in the Bill it becomes law. Then we can say to their employees, whether they be management, general workers or whoever that their rights are protected. If Members will read my amendment they will see that it stipulates nothing out of the ordinary, normal conditions that would apply in such cases. Its insertion would also have the effect of allaying any fears at present existing in workers' minds. As I said a few moments ago, they are "quare" times when Fianna Fáil decide to sell the Irish Sugar Company. Many people have said already that surely they are "quare" times when Fianna Fáil decide to sell the Irish Sugar Company. In such circumstances, we must at least ensure that employee's rights, conditions of service, pay, and so on, are protected.
One contentious matter referred to in the document was that of the redundancy terms. I referred to this yesterday evening. The document to which the Minister referred says that the current redundancy terms being paid by the company are those which emanated from the 1981 conciliation conference. It says the company acknowledges that this is the current position and has no plans to change those terms. I would ask Members to listen to that terminology, because the Minister is pre-occupied and does not appear to be taking an interest in something on which he relied so heavily last evening for the purpose of ensuring the rights of employees in this matter. The most contentious matter arising for employees is that of the redundancy terms.
There will be no redundancy.
After very protracted negotiations in the 1981 period, an agreement was reached. Then in 1988 and 1989 the company began to say that there was no such agreement. Of course, the reason the company management were saying that there was no such agreement was that they saw somewhat further ahead than their employees at that time, since they were then drawing up plans for what is happening today, the privatisation of the company. Therefore, it will readily be seen that it is very important that they be able to say to the new owners, "Well, we do not have such a redundancy agreement that allows for 5 per cent-plus, or whatever, to employees of the company." This forms the major part of the employees' present argument. Why did the company deny that such an agreement existed? The Labour Court had a hand in it some time around 1986, agreeing that both parties should sit around the table, but did not say there was not an agreement.
If I may read this document again, what it says is that the current redundancy terms being paid by the company — those are the terms at present being paid by the Irish Sugar Company — are those which emanated from the 1981 conciliation conference. It goes on to say that the company acknowledges that this is the current position and has no plans to change those terms. It is all very well for the Irish Sugar Company to say that, but that does not make any provision henceforth for the workers who will be employees of a new company. Consequently, I am asking in this amendment that such provision be made, that it apply to the terms and conditions of employment and to any other benefits, including rights and privileges, obligations and any other arrangement applying to employees so transferred. That makes good sense. Furthermore, it is said that the company acknowledge that this is the current position and has no plans to change those terms. Of course it has no plans to change those terms, but it will not be in existence to stand over what is stated in that document. That is my main point because the company will have no right to make such provision in the future. But the Dáil has the right to do so. It is the Dáil that is deciding to change the law and to privatise the company. Consequently it can insert the desired protection in the Bill, which is very much part of the demand of the Irish Congress of Trade Unions, as will be seen from the document which they supplied to the Minister in January.
I would be very critical of the fact that the Minister did not agree to insert his amendment to the Bill. It was my understanding that if agreement were reached the only basis on which it could be reached was that the Minister had agreed to the demands of the Irish Congress of Trade Unions.
Another phrase used was that privatisation would not give rise to changes in continuous employment in subsidiary companies. What a great farce to introduce a document of that nature, contending that there will be continuity of employment in subsidiary companies of the Sugar Company.
Of course there will be.
How can anybody predict what will be the position in a month or two months time? It went on to say that the subsidiary companies ought adhere to existing procedures in determining the rates of pay and conditions of employment in those companies. Who are those subsidiary companies? There are very many subsidiary companies of the Sugar Company. Without including this amendment in the Bill how can anybody say that the terms and conditions of employment are protected for those employees? Immediately following privatisation the financial institutions will be in the driving seat. They will have the say and will determine what the conditions will be and will then start back into negotiations.
I would make one very strong point, that section 45 of the Postal and Telecommunications Services Act, 1983, made provision for the conditions of employees. This document is all the Sugar Company workers have to rely on. Section 7 of the Labour Services Act, 1987, which provided for the setting up of FÁS, section 43 of the Forestry Act, 1988, and section 8 of the Agricultural Research and Training and Advice Act, 1988 — which provided for the setting up of Teagasc — included provisions to protect the conditions and rights of workers in those companies. All we have for the Sugar Company is this document headed company/union agreement concerning terms and conditions of privatisation of the Irish Sugar Company. I do not want to repeat myself but the company referred to herein will only be a subsidiary of the company. I know what subsidiaries are. As I mentioned previously, the quarries are subsidiaries of the Irish Sugar Company but they would not have any power to negotiate wages. They are the same employees of the Sugar Company but are merely subsidiary bodies and do not have any rights except to negotiate with the general body of the company.
The Deputy is lost.
That is the procedure that applies. In the case of Dairygold in the Mitchelstown-Mallow area, under the conditions of employment——
The Deputy was very quiet in Rathduff the other night.
——which also applied to managers, a manager employed in Mitchelstown was told that his job was in Rathduff.
That is closed.
One person with 25 years service had to come in to be interviewed by the board. It is very important to emphasise that. Those people were brought in before the new board management and were told to forget about their previous employer and that they were now looking for a job with the new company, Dairygold.
We are talking about the Sugar Company here.
He was told he was there to do an interview with the management of Dairygold.
On a point of order, we are not dealing with Dairygold or any other company but with the Sugar Company. The Deputy's contribution should be in some little way relevant. His contribution is totally and utterly irrelevant.
I am trying to call the Minister's bluff and I think I have already done so. The document which the Minister relies on states that the company/ union agreement concerning terms and conditions of privatisation of Irish Sugar Company cpt will continue and so on. How can it continue if the Sugar Company are not there to stand over it? The Sugar Company will only be a subsidiary. I have already made that point. I am here to speak in the interests of the workers who are employed in the sugar industry. I want those conditions written into the Bill. That is the only way those people who have made such a contribution to the building up of the Sugar Company over the years can be protected. That is what we are debating here this evening. It is not what civil servants or others think; it is what the workers think, the people who worked on three shifts and at all hours to build up that company. These are the people I am concerned about. It is no good for civil servants to laugh because, at least, the workers have a say here this evening and that is very important.
The capital invested in the company in the mid-eighties went towards reducing the numbers employed from over 3,000 to 1,500. I admit that that number increased somewhat when the company bought into Odlums and into the other companies. That line of procedure was OK, the position being that the employees could come into the mainstream. We have a situation at present where in the late seventies some very cute people in the commercial world got the idea that they would set up a company called Sugar Distributors. Sugar Distributors is a subsidiary of the Irish Sugar Company. Because they were in existence at a certain time they had protection under EC regulations. Consequently the Minister had to go into the High Court to regain 51 per cent of the shares in the company. The company were able to give the advice to the growers. The growers grew the beet, they took it into the factories where it was manufactured into sugar. Immediately it went into the sugar silos the private enterprise said: `You dare not touch that sugar, that is ours, it is the property of Sugar Distributors Limited, an entirely new company". The company had to go into the High Court and buy back their shares. My experience of that subsidiary was that those people had no conditions of employment because they were not directly employed by the Irish Sugar Company.
The Irish Sugar Company can be a very tough company to deal with when it comes to wages and conditions of employment. It is true to say that they have reneged and that there have been protracted negotiations. I would also make the point that the unions involved in the Irish sugar industry took a decision to take strike action in 1990 to get their rights under the proposed legislation which is now being enacted. The vast majority of the employees in Carlow and in Mallow supported the call by the Irish Congress of Trade Unions for strike action. Why did workers decide to take action up to and including strike action which would possibly have meant one day stoppages and so forth? They wanted to have conditions properly secured in the legislation that was being enacted. This indicates just how strongly the workers feel about this issue. I ask the Minister to deny, if he can, that such a decision was made. Immediately the result of the strike ballot was known things began to change and negotiations took place between the Minister and the Irish Congress of Trade Unions. These negotiations resulted in this document. The workers in the Mallow sugar factory took the document home with them so that they could study it and they do not believe it is strong enough to protect their interests.
What is required is a reasonable amendment to the legislation. If an amendment can be made to section 27 of the Industrial Relations Act why can a similar amendment not be included in this Bill? The capital required is only one aspect of the issue. We should not forget that a good labour force are essential if a company are to be successful. The labour force in the Irish Sugar Company are second to none. I put down this amendment to ensure that their rights will be protected in the future.
While there are some similarities between my amendment and Deputy Sherlock's amendment I have a difficulty with Deputy Sherlock's amendment in that he proposes to insert a new section 3. Nevertheless, I support the proposal in his amendment, that is, to ensure that the rights and conditions of employees are protected when the company are taken over by the new holding company. This is what we want to achieve.
Yesterday the Minister assured the House that an arrangement had been agreed between the Irish Congress of Trade Unions and the main union in the Sugar Company, SIPTU, and outlined the terms of that arrangement. We were concerned about two aspects of this arrangement, the redundancy terms and the pension fund. The Minister assured us that the redundancy terms would be the best available and that the pension fund had been secured so that there would be no interruption in employees' contributions as a result of privatising the company. I accepted that the arrangement had been agreed and that the problems which had existed up to last week had been ironed out to the satisfaction of the various unions involved, their representatives on the shop floor and the Minister. If the union of which I am a member have bona fide agreed to an arrangement which has been lodged with the Labour Court then I do not believe there will be any sleight of hand by anyone after the new arrangement is made. The Sugar Company would not be able to prosper and survive after they are privatised if any effort was made to vary the terms and conditions of that arrangement.
In order to be absolutely certain about this issue, I put down a reasonable amendment which I hope the Minister will accept. If my amendment is accepted section 6 (1) will then provide that:
Every person who immediately before the transfer date was an employee of the Company, shall, on the transfer date, enjoy the same rights (including rights under a pension or superannuation scheme of the Company and the terms and conditions of the Company/Union agreement registered with the Labour Court under section 27 of the Industrial Relations Act, 1946)...
This is a reasonable amendment. The Minister argued against the inclusion of an amendment I put down which contained all the various elements of these rights and conditions. He said that this was not the way in which to approach this Bill. However, I looked at the Telecommunications Act and other Acts and put down my amendment on the basis of what was included in them. Companies like An Post and Telecom Éireann have been privatised and as the Sugar Company will be partly privatised I believe it is necessary to ensure that any agreement entered into with the old company will apply equally in the case of the new holding company, Greencore, and their subsidiaries.
I will no longer flog this issue to death. We debated it at length yesterday and we got some concessions and guarantees from the Minister. Nevertheless my amendment to section 6 would ensure that we would not have to go through every line of the agreement between the Irish Congress of Trade Unions and the company. If there are any queries about the rights and conditions of workers in the future we could refer to this provision in the Bill. I hope the Minister will accept my reasonable amendment.
The Bill provides that on the operative date every employee shall have the same rights and obligations he had prior to the passing of this legislation. That is absolutely clear. In order to put this issue beyond any doubt and to reassure the House, I indicated that I was prepared to formally convey to the House the terms of the agreement which had been entered into between the employers and the employees, the company and the unions. I want to put it on the record that I have done this. I will refer later to the proposal in each amendment.
The amendments are not acceptable because they are not necessary. As I have made clear, if we were to incorporate into legislation every detail of every worker — union relationships and agreement between employers and employees, our legislation would be over-burdened with details of agreements, pensions, redundancy terms, recognition of trade unions and a whole range of issues which are not appropriate to legislation. For instance, section 6 states that every person who, immediately before the transfer date, was an employee of the company shall, on the transfer date, enjoy the same rights — it specifically says "rights", and that has a very clear legal meaning — including rights under a pension or superannuation scheme of the company and be subject to the same obligations as he enjoyed and was subject to immediately before the said date. That section then elaborates on pensions and superannuation schemes. That is as clear and unequivocal a statement of the law as you can get in any legislation, but because I wanted to reassure the House that the actual details of the agreement entered into between the Irish Congress of Trade Unions and the Sugar Company would be a matter of record for the House, I informed the House that I was prepared to accept amendments. Over and above that, I also wanted to have a formal involvement through notification to me of the details of that agreement.
I told the House yesterday that the chief executive of the Labour Relations Commission wrote to me at the end of last week formally indicating that following a series of conciliation conferences the parties have agreed to certain recommendations. Both parties also agreed to advise the Minister for Agriculture and Food of this agreement. The agreement, signed on behalf of the Irish Congress of Trade Unions, the Sugar Company and the Labour Relations Commission, sets out eight different points covering such points as no interruption in continuity of employment, current rates of pay and conditions of employment will continue to apply, the company will continue to recognise the existing trade unions and existing procedures for determining rates of pay and conditions of employment will continue to apply etc. The current redundancy terms of the company are those which emanated from the 1981 conciliation conferences. The company acknowledge that this is the current position and they have no plans to change those terms.
The agreement states specifically that privatisation will not give rise to changes in continuity of employment in subsidiary companies or to existing procedures for determining rates of pay or conditions of employment in those companies. It then goes on to say that within 30 days of vesting day moneys will be transferred into the manual pension scheme to cover pre-1984 pensions as determined by the scheme's actuary. Deputy Kavanagh has acknowledged the significance and extent of that. It is a very major element and clearly one of considerable importance for the workforce. The agreement says that pre-1984 service in the manual scheme will be funded on a phased basis over a five year period from 1991, in accordance with the advice of the scheme's actuary. Deputy Sherlock, take note. The Deputy seemed to imply yesterday that in this case there never had been a proper actuarial assessment.
I did not say that. I asked the Minister to produce an actuarial assessment.
This agreement will be registered with the Labour Court — this is a formal registration — under section 27 of the Industrial Relations Act, 1946.
I challenge the Minister to produce an up-to-date actuarial assessment.
A Leas-Cheann Comhairle, you will note that once again I used my restraint and patience and did not once interrupt Deputy Sherlock. I insist this time that he gives me the same courtesy. He should not be given the right to say what he wants even when it is not relevant, or to make outrageous charges when they are not well founded. When I reply he reserves the right to interrupt. A Leas-Cheann Comhairle, I will not stand for that from Deputy Sherlock.
The difference is that I am representing the workers. The Minister is trying to sell a pig in a poke.
Both parties agreed to formally lodge a copy of this agreement with the Labour Relations Commission and to request the commission to consider themselves the guardian of this agreement. The commission of the Labour Court are requested by the parties, the Irish Congress of Trade Unions and the management of the Sugar Company, to be the guardians of this agreement. What Deputies are attempting to do here, particularly Deputy Sherlock — I want to specifically mention Deputy Sherlock — is to denigrate the agreement, to undermine it, to suggest that it does not represent what it does.
I want to quote Deputy Sherlock, who once again today is engaging in the big lie as he did yesterday, in his totally outrageous approach to this agreement. He said that hereafter the Irish Sugar Company will not exist. That is false. It is as false as the allegation he made yesterday when he said this agreement is not worth the paper it is written on. That is a false statement and should not be allowed to remain in the record of this House. Deputy Sherlock said he is here in the interests of the workers employed in this industry.
The company will continue as a subsidiary company and will have no power of decision making.
Deputy Sherlock is implying that he——
The holding company, Greencore, will make the decisions.
——and the Workers' Party who engage constantly in the big lie — and he has not yet withdrawn it — represent the interests of the workers in the industry when he knows that the people who represent the interests of these workers are their trade union representatives and the Irish Congress of Trade Unions who have entered into this solemn binding agreement. They have achieved an agreement, on which I congratulate them. I share their determination to protect the interests of their members. I want to say again that I resent and reject the total distortion on the part of The Workers' Party who are practised in the big lie, but this big lie on the record of this House is not going to undermine the interests of the workers of this company.
Deputy Sherlock went on to say — and if you get into the big lie business it becomes a very profitable industry indeed, at least that is what The Workers' Party believe, and this again is an outrageous lie — that all employees will be asked to sign a new contract.
They will be asked to sign it. We are not that naive.
That is just not true. The Deputy said the Sugar Company will cease to exist, but that is not true. Then he said that all employees will be asked to sign a new contract, that is not true. If the Deputy starts from that false premise, like every other false premise from which The Workers' Party start — and God knows the party from which they originated did not show too much respect for workers or their rights, and some rights are more important than rights of pensions——
That is an outrageous thing to say——
Yes, it is.
——from a man who lied through the teeth to the people of Thurles——
I listened to this all the time from The Workers' Party.
——that he would protect their sugar factory.
I am not prepared to allow The Workers' Party representatives here to claim that were it not for them the interests of the workers employed in this industry would go unprotected. That is not the case. I am glad to say the Government, and indeed the other parties in this House, have been very concerned to ensure that the interests of those workers are protected. That is why I spent the last number of months with my colleague, the Minister for Labour, and my officials in consultation with the unions. Very useful and fruitful consultations went on right up to this week because we are concerned for the interests of the workers. We recognise the role of the Irish Congress of Trade Unions because they represent the interests of those workers.
It has been implied in this House that The Workers' Party are the only people who know the reality and that the rest of us are telling lies, that the union, the company and the Government cannot be relied upon, that the only people who can be relied upon are the ever-changing named The Workers' Party — I cannot remember what they used to be called. If they can change their name so often they can also change tack. The one thing they will not change of course is their capacity to distort. For as long as they continue with that in this House I will show them the contempt they deserve. They will not undermine a very solid agreement between unions and workers or create apprehension, distrust, animosity, division and tension — which is their stock in trade — between employees and employers. They would wish that to happen but I have bad news for them, it will not happen.
I am very much disposed to the views which Deputy Kavanagh expressed. I appreciate and accept that his amendment is motivated by a desire to confirm the security of the workers in this employment. I hope Deputy Kavanagh will accept that it is not appropriate to write in details of this nature in legislation as the guarantee is already in the framework of the legislation as well as in the agreements. If the precise provisions in regard to all aspects of redundancy, pensions, recognition of unions, pay and conditions and notifications of termination were written into Bills our legislation would be cluttered. It would mean that the normal process of agreement — and registering agreements — which exists between unions and employers, and is an established part of the rights of trade unions, would be taken over by this House. It would mean we would say that those agreements did not really matter, that they were not significant and binding unless they were written into law. I do not accept that. Agreements entered into between the Irish Congress of Trade Unions and the company are very solid and I do not want to give the impression that they need to be written into legislation to ensure that they have solemnity.
I feel compelled to intervene in this debate for a number of reasons. Up to now the issues arising in the debate have been very competently dealt with by our spokesperson on Agriculture, Deputy Kavanagh.
I am strongly in favour of Deputy Kavanagh's amendment. As a Member of this House I represent the constituency of Carlow-Kilkenny and, in my 30 years here, I know of the very strong commitment of the workers, particularly in Carlow, to the development of the Carlow factory. Unfortunately, it is not quite as successful now but that is history. If it was not for the workers who made sacrifices for the company we might not be here today talking about privatising the Sugar Company. I am very familiar with the sacrifices — I deliberately use the word — of those people. It is not an exaggeration to say that some workers gave their lives for the sugar factory because they worked hard in difficult days, under bad conditions and for long hours. They are the prime part of this debate.
In objecting to Deputy Kavanagh's amendment, the Minister may be trying to make the Bill more acceptable to future investors. However, we want to ensure that the Bill is as acceptable as we can make it to those people, and their families, who have given so much to building up the company and who have made it possible for us to be talking about privatisation and handing over some of the benefits to other people. The least the House can do is to include in the section the amendment tabled by Deputy Kavanagh which does not spell out the details of the agreement, as the Minister said. It is a very simply worded amendment, it seeks to insert the terms and conditions of the company-union agreement. We endorse the contribution the workers made to the success of this company and we are sending a clear message that, no matter what happens in the future, the House recognises that the rights of the workers should be fully protected. The Minister has gone three-quarters of the way towards accepting the amendment and I hope my words will influence him to go the remaining few steps required to accept the amendment. If he does we will be showing our concern for the workers. The Bill would be considerably strengthened by the insertion of this amendment and the Minister should accept it to say a big thank you to the workers, their families and descendants of the workers for their efforts. Many of the people who work in the Sugar Company today are sons and daughters of those who gave their life to the company. We owe it to them to insert Deputy Kavanagh's amendment.
I support the Minister in relation to the agreement between the company and the Labour Relations Commission. It is a new commission and I wish Kieran Mulvey every success in his position as chief executive. The Government took an innovative approach in setting up the commission.
Last year the Irish Sugar Company paid in the region of £33 million in wages, a major contribution to the economy and the workforce. I have great admiration for the workers and the management of the company. I worked very closely with them and I have no doubt that they do not have any fears. I cannot understand why some Members say there will be no continuity; after all there will not be any great change apart from a change in the equity base to give it greater support and funding.
There was a reference to subsidiary companies. The balance sheet was prepared and signed by Coopers and Lybrand; Sugar Distributor Holdings and Sugar Exports Limited are 100 per cent owned by the company. I do not see where the confusion arises. The people who work in Sugar Distributors, a subsidiary of the Irish Sugar Company, will have the same management structure and will have greater security because there will be greater access to capital. I fail to understand why there has been criticism from the Members who tabled amendments saying that they fear for the future of the workers.
If the Sugar Company are to continue there will have to be workers in the industry. In regard to the rationalisation programme that is taking place, I must say the workers and management have suffered over the last few years in that drive to streamline the company especially in the sugar division. I hope that is all behind us now and that we can look forward to a very successful Sugar Company and that the employees in the factories in both Mallow and Carlow have safe employment for a number of years ahead. I believe any disruption that takes place will not be the company's fault.
The contribution that has been made for Mallow, which is my backyard and area, in terms of the economic wellbeing of the town and its hinterland, has been very significant. I wish the workers well in the new company, Greencore. I do not understand why people have to question the continuity of the company or even cast any doubts on it. As we are well aware, the workforce are in place, and they are a good workforce.
In amendment No. 1a, Deputy Sherlock is seeking, as he has done on behalf of The Workers' Party throughout this debate, to ensure that the optimum protection is given to the employees of the Sugar Company. I sincerely trust the Minister is not going to leave because I came back into the House to reply to some of his earlier vituperation.
From the very outset Deputy Sherlock as a former Sugar Company worker has sought to ensure the maximum protection for his colleagues still employed by the Sugar Company. That, and that only, is the motivating factor behind this amendment. I can bear out, as can Deputy Pattison, as former trade union officials, that it is all very well to say across the floor of this House, "You need not worry about that, that is protected, there is a time honoured agreement and in this case it is even registered with the Labour Court; there is nothing to worry about".
We have all had experience over the last 20 years of take-overs, mergers and so on of various companies and the facts of commercial life are that the ball game changes entirely. If the company do well — in this I think they will — there will be fewer difficulties than there would otherwise be, but I can recall time out of number the occasions on which I have been called in by a company to say, "that is all very well, but that is the agreement of yesteryear; however, the facts of the marketplace are different now and your members will have to face up to that", and nine times out of ten that happens. That is the reason Deputy Sherlock in amendment No. 1a is seeking to enshrine in this Bill protection, and not any of the outrageous reasons being imputed by the Minister.
I am sorry his departure has coincided with my arrival because he made a right ass of himself in this debate last night when he started waffling about the positive right to strike as an explanation for an article from the memorandum and articles of association that I raised, and then he dug the hole deeper by claiming this positive right to strike was enshrined in the common law. If it had been enshrined in common law, there would have been no need for the 1906 Act, and the terms and provisions of which have been repealed by the 1990 Act are a system of conferring immunities for actions that would otherwise be unlawful. I cannot understand why my party have to sit here and listen to this sanctimonious cant from this Minister.
I spent the earlier part of today negotiating through the House from Committee through to Final Stages the Workers Protection (Regular Part-Time Employees) Bill and not one acerbic remark was made across the floor of the House between the Opposition spokespersons and the man who will probably turn out to be the Minister for Agriculture and Food's boss very soon. It really is too much to have to sit by the monitor trying to deal with normal business and listen to this self-righteous Minister pouring out scorn about the motivation and purposes of The Workers' Party and Deputy Sherlock seeking to use the opportunity of this novel legislation to enshrine in the Bill the optimum protection that is feasible for the workers left in that company. That seems to me a perfectly honourable and understandable motive. It seems the most normal thing in the world that anybody, especially somebody who worked for the company as Deputy Sherlock did, should come in here and use the only opportunity we have to do that. There will be no point coming back here next year because, in my view, the dynamics of the marketplace will take over and our shareholding in this company will diminish. There is no doubt about that. That battle has been fought and lost here. It seems entirely reasonable that Deputy Sherlock should come in here with an amendment and that Deputy Kavanagh should come in with a slightly different version of the same amendment. I am bemused that Deputy Kavanagh's motive was not questioned by this very sensitive and self-righteous Minister while my party's were. I am sick of it and I am sorry the Minister had not the guts to stay in the House so I could deal with this matter face to face.
He did not know the Deputy was coming.
I am very surprised that the Minister made no reference to Statutory Instrument 306 of 1980, the EC safeguarding of employees' rights on transfer of undertakings regulations 1980 which gives certain rights to workers in the matter of take-overs and so forth. In such circumstances, we are now told that this sheet of paper with eight items on it, registered under the Industrial Relations Act, is what the ICTU sought on behalf of the workers and that will be adequate and sufficient to protect the interests of workers.
The Minister continually called me a liar because I said the Sugar Company would be no more. We are not fools. Once this legislation is enacted it will repeal the Act that set up the Irish Sugar Company; consequently once that Act is repealed the Irish Sugar Company will be no more but will later, of course, become a subsidiary of Greencore. How many subsidiaries do the Sugar Company have? We have Interchem, Armour Salmon, Sugar Distributors, Premier Molasses and so forth, a number of companies, but they have no real impact when it comes to negotiating employees' conditions, wages and so forth. They all belong to the same pool with the exception of Sugar Distributors.
It was an awful state of affairs when the Sugar Company manufactured sugar and handed it over to private enterprise, as they did up to the late seventies. Sugar distributors controlled the distribution of sugar in this country and made a profit and became very wealthy, especially from exports to Northern Ireland. I know what I am talking about. That was private enterprise and the Sugar Company had to go into the High Court and buy out that company at great cost.
When the Minister was speaking he constantly referred to this very desirable and highly recommended document from the Irish Congress of Trade Unions and the company.
On 28 January 1991, when Congress wrote to the Minister they referred to their proposals for the amendment of the Sugar Company Bill, 1990 concerning the rights and benefits of employees of the Irish Sugar Company and said — it is a pity the Minister is not here to answer this — that on 18 December 1990 the private secretary to the Minister for Agriculture and Food wrote to the general secretary of the congress, Mr. Peter Cassells, and said that the Minister intended to insert into the Sugar Company Bill, 1990, provisions to safeguard the interests of workers. Did that happen without the Minister's knowledge?
Subsequent to that, the provisions of the Labour Services Act, 1987, the Forestry Act, 1988, the Agriculture (Research, Training and Advice) Act (No. 18) 1988, and the Post and Telecommunications Act, 1983, protecting the rights and benefits of workers in respect of their employment, were brought to the attention of the officials of the Department of Agriculture and Food and the concerned people in the Department referred Congress to section 6 of the Irish Life Bill which relates to the same matters concerning the workers in that company. How far have we gone from that position? I will tell the House how far we have gone.
Congress said there was an important difference in style and in the content of the provisions outlined in the four Acts brought to the attention of the Department in the Irish Life Bill. The Minister challenged me on this. I said, and I stand over it, that each employee will now be making a new contract of employment with the new company. The contract of employment is between the employee and the employer. In this context, it will be Greencore. The Bill states that an employee of the original company shall, on the said date, become an employee of the new company with the same rights and subject to the same obligations as applied under the old company. Why does the Minister not comply with what was agreed at that stage with the Congress of Trade Unions?
The four other Acts detail provisions relating to the continuity of employment, recognition of trade unions and staff associations and the continuity of terms and conditions of employment. I submit that it is the view of the Congress of Trade Unions that if the shorter text in the Irish Life Bill means the same as the longer text in the four other Acts, then it is a positive advantage to both the Minister and the trade unions, with reference to explaining the legislation to employees of the company, to use the longer form which is more explicit. If, on the other hand, the provisions in the Irish Life Bill do not mean the same as those in, for instance, the Labour Services Act, 1987, then the position of the workers of the Irish Sugar Company could not be guaranteed in relation to the items listed.
What has been stated by the Minister in this document does not bear any relation to anything that is contained in the congress document and makes no reference to any of the legislation which, if complied with in this Act, would give safeguards to employees The Minister says that I am lying and so on. I am sorry he is not here now to answer this question. I am convinced beyond a shadow of doubt that it is intended to pull the wool over the workers' eyes, to present something to new employers as if the employees did not exist and did not have conditions of employment. The company are too eager to present this to the big financiers who will come in to buy out that company which is partly owned by the workers, as it was built on the sweat of the workers, in a way which will attract them. I am grossly disappointed. I feel strongly on the point for the reasons stated and we will press my amendment.
During Second Stage debate there was no reference in the Bill to rights and conditions of employees. It was only after the discussion on Second Stage that the Minister promised to introduce an amendment which would assure the rights of employees in relation to conditions of employment and so on in the new company. We have argued as to what is appropriate in the Bill. I put down a lengthy amendment based on earlier legislation which would have adequately met the needs. When the Minister was disposed to resist Deputy Sherlock's amendment and my amendment and came forward with this agreement that had been entered into by the unions, we found that the agreement was inadequate in its wording and we pressed the Minister for explanations on various matters like redundancy and about other areas where the document was deficient. Since then, negotiations have been going on over the last weekend and the unions and the company, according to the Minister, have reached finality on an agreement in this area.
Having failed on Committee Stage to get an appropriate amendment accepted, I have on Report Stage simply tried to tie down the Minister into putting into the Bill the fact that agreement had been arrived at between the company and the unions and that it had been registered in the Labour Court. That is the minimum the Minister could do, as Deputy Pattison has said, to assure the workers who have given tremendous service to the company that their conditions and rights had at least been registered in the Labour Court and there was a document there which could be inspected if a dispute arose. The Minister rejected that. I fail to see how he can do that. The reason he gave is that it is not appropriate to write into an Act the details of an agreement, but I have to tell him that that is not so. I have before me a copy of the Postal and Telecommunications Services Act, sections 45 and 46 of which run to about two pages and list the conditions of service for the employees of the two companies concerned. This was done at a time when they were still part of the Civil Service. Section 45 deals with the provisions applicable to staff transferred to companies; section 46 with superannuation and section 47 with the provision of certain welfare funds. Therefore, there is a precedent for doing what at least two parties on this side of the House tried to do yesterday.
All our proposals have been rejected and we are now down to the minimum of two lines contained in brackets, but the Minister has told us that it is not appropriate to enter the details of an agreement in an Act. The amendment would not enter the details in the Bill; all I am doing here is referring to a document which contains some detail. I am not referring to the negotiations which have taken place or outlining each of the eight points on which any competent trade union official would make sure he had agreement. My amendment simply refers to the agreement being registered in the Labour Court. The Minister has said he cannot accept it, even though the sections dealing with the rights and conditions of service of workers in An Post and Telecom Éireann run to approximately 100 lines.
I have come to the conclusion that the reason the Minister is resisting this amendment so strongly and the reason he is rushing this Bill through the House and will rush it through the Seanad tomorrow and on Friday, is that he wants to ensure that nothing in the Bill will offend people in the Stock Exchange, the institutional or private investors, who are screaming for the Bill to be put through the House so that the company can be floated at the earliest possible date. When I collected these Acts in the Library I happened to meet a Senator who has a connection with the Stock Exchange. I asked him if the inclusion of an amendment such as this would have an effect and he replied that those who invest in companies do not like to see agreements with the unions written in. That underlines the point I am making.
The Minister is so anxious to ensure that the maximum benefit will be gained from the flotation of the company that he cannot even look after the workers who have contributed so much to the success of the company. Deputy O'Keeffe has outlined the profits which have been made in recent years by the company, yet the Minister cannot even do this much.
I should point out, and I am sure you are aware of this, Acting Chairman, that the Act which established the FII, a big company in County Wicklow, who have their own problems, contains sections dealing with the conditions of service. I fail to see, except for the reason I am giving now, how the Minister can resist including this minimal amendment. He has rejected all others. It is an affront to everyone who has contributed to the success of the Sugar Company not to make that small concession to the company's workers. I will be pressing this amendment to a vote.
I erroneously allowed you to contribute, Deputy Kavanagh — and it is not because you are my constituency colleague — but technically we should have completed the discussion once Deputy Sherlock concluded.
I move amendment No. 1b:
In page 4, line 4, after "Company" to insert "other than the special share".
Section 4 (1) states:
Every share of the Holding Company which is to be allotted or transferred to the Minister or the Minister for Agriculture and Food or their nominees shall be allotted or transferred either, as the particular Minister shall direct, to the Minister concerned or to a person (in this section referred to as a nominee) nominated in that behalf by the relevant Minister, and different persons may be so nominated in respect of different shares.
Section 4 (2) states:
The following provisions shall apply and have effect in respect of all shares of the Holding Company which are for the time being standing in the name of a nominee for the Minister or the Minister for Agriculture and Food, that is to say:
I wish to amend this and have inserted:
The following provisions shall apply and have effect in respect of all shares of the Holding Company other than the special share...
Emphasis must be placed on the special share. We are told that it is the special share which will protect the interests of growers and a great number of other people, in other words, the sugar quota. I have heard no argument to convince me that a new holding company cannot import sugar. Of course, they can. The only thing stopping them importing sugar at present is that we have a sugar quota; and even though the price of sugar is higher here than on the world market, it is protected by the fact that we have a sugar quota, but that may not always be the case. Any new holding company which would see it to their advantage to import sugar could very well do so. They could reduce in the initial stages the amount of sugar to be produced in Ireland and import the balance. There are plenty of instances where that almost happened. I made the point last evening that it almost went to that point a couple of years ago. Consequently there is a need for protection.
Why is the Minister relying so much on the golden share? There is no evidence that the golden share can be used to protect a company in other EC countries in the event of take-overs, whether in Britain or in France or in any other country. We had the examples of Britoil and Jaguar in Britain, and the congress of trade unions recognised at an early stage that the golden share was not applied. The legal implications of the special share, whether it is legal in the EC context, have never been spelled out and would need to be clarified. If the Minister can dispose of the shares that will be allocated to him we should at least have a provision in the Bill for disposing of such shares in the holding company other than the special share.
This would give us confidence because we would have an Act on which to rely and to defend our rights. The Irish Congress of Trade Unions say that the provision is specially made in the Sugar Bill allowing the Minister to dispose of the special share in the new company. This runs directly counter to the assurance given to them and that is the reason the Minister moved his amendment which states that the Minister may not dispose of the special share. We all know how easy it is to drive a coach and four through legislation that has been enacted from time to time. We want to close off the loopholes. There is no point in the Minister having an amendment which states there will be a special share which he shall not dispose of if he allows section 4 (2) to stand. For that reason I propose an amendment to section 4 (2), to insert the words "other than the special share" after the words "Holding Company".
We are quite happy that the Minister's amendment meets the case in question. I do not see any likelihood of the company or their quota being swallowed up by foreign interests. I might point out to Deputy Sherlock, with your permission a Leas-Cheann Comhairle, that even today there is no guarantee that the sugar issue can be controlled internally. Every member of the EC is entitled to sell sugar in this country under the rules of the Treaty of Rome. A number of them have been selling sugar in this country in recent years, and were it not for the sterling performance of the Sugar Company, under the chairmanship of Mr. Bernie Cahill and the genius of the chief executive, Mr. Comerford, we could be in a really dangerous situation at this time.
We had sugar imports in the middle eighties and for a considerable time they threatened the very existence of the Sugar Company. That should be borne in mind by everybody. The Sugar Company was put on such a competitive and effective footing by the people to whom I referred and by the board generally that we were able to combat the threat posed by those sugar imports. One is never totally safe, whether a company is State owned or is a public company. One has always to bear in mind that we are dealing in an open market and we have to compete with other concerns because if we are not efficient, our sugar industry will be devastated. This legislation is moving in the right direction to ensure that our position is further strengthened. We need a very strong sugar sector to take on the competition.
When I asked the Minister about the composition of the new holding company, he did not reply but intimated that at a future stage in the debate he would reply to my query as to the initial constitution of the board of the new company, Greencore. Members of the House are entitled to know how the new board will be constituted, whether it will be a continuation of the present board, an entirely new board or a combination of a partially new board and an old board. We would also like to know how long the new board will be in existence before there is a public meeting of the shareholders and a constitutionally elected board is formed. We are all entitled to know that. It is a very basic thing. I would be totally opposed to any system where a public company was run by a group of political hacks, and it happens repeatedly. I would like to see a very much above board set of directors nominated, because initially they will not be elected. Until such time as the company are fully in motion and we have annual general meetings and people are democratically elected, I would like to know how the board will be selected so that we can have some confidence in their operations.
The Sugar Company get a very brief mention in the Programme for Economic and Social Progress. There are assurances to the country in general that the special share will be the protector of the sugar quota and the sugar industry in this country. It was only because of our insistence on Second and on Committee Stages that the Minister brought in an amendment to say he would not dispose of that share. Up to then it was possible for the Government's share to be disposed of by the Minister.
The purpose of Deputy Sherlock's amendment is to leave no doubt that this share cannot be sold under any other sections of the Bill. Even though the amendment was to section 2, and Deputy Sherlock's amendment is to section 4, I have the same concern. I consulted the Bills Office and they told me that this section did not apply to the special share and that it was unnecessary to put in an amendment. That is why I did not put down an amendment on the same basis. Quite honestly, however, listening to discussions here today, I wish I had gone ahead and put down an amendment. At least there will be an opportunity to put in an amendment in the Seanad in this area if nothing is done here. It seems to be totally appropriate and that is why I consulted with the Bills Office about this amendment which says that the following provisions shall apply and have effect in respect of all shares of the holding company.
All that is being asked in this amendment is to except the special share from all those shares. I do not think it is too much to ask that we have total clarity in this area so that we are not saying in one section that we cannot sell the share and then in another section saying that we can sell all the shares. The Minister assured us yesterday in the House that the Minister for Agriculture and Food has only one share, and that is the Government share.
Section 4 (2) (a) says that the Minister or the Minister for Agriculture and Food may transfer all or any of the said shares to another person selected by the Minister concerned to hold as his nominee shares so transferred. Maybe the golden share can be given to somebody else in the Department, for example, the secretary. However, the Minister said he was going to hold it. These little changes should be underlined and we should know exactly where we are going with this share because now it is certainly the only item in this Bill, the only thing being held out by Fianna Fáil in the Programme for Economic and Social Progress as a safeguard of our quota of sugar, of the industry in general, the consumers, the employees and the growers. We are now down to depending on this particular share. It is most important that there be no doubt left in this Bill that anything can be done to transfer this share out of the Department of Agriculture and Food into anybody else's hands.
During the Committee Stage debate yesterday the Minister promised that he would have the Attorney General's Office examine the wording of this subsection to ensure that it represented exactly what is intended and that there was no possibility that the special share could be disposed of to the secretary of the Department or to anybody else. I now want to assure the House that the Attorney General's Office have examined this subsection and have confirmed that they are satisfied that the wording as now printed in the Bill should stand.
I find it difficult to understand the reasoning behind Deputy Sherlock's amendment. The whole purpose of this section of the Bill is to empower the Minister for Finance and the Minister for Agriculture and Food to appoint nominees and to transfer shares to such nominees to act on their behalf. The section sets out the rights and duties of nominees and the power of the respective Ministers to issue directions. I want to stress that Ministers cannot, of course, do everything themselves, even though we try to from time to time. It is only right and proper that they should be able to appoint nominees to hold shares for them and to act on their behalf.
If Deputy Sherlock's amendment was accepted then the Minister for Agriculture and Food would not be permitted to transfer his special share to a nominee to act on his behalf. I want to stress again that this is the only share the Minister for Agriculture and Food will have. This amendment is unacceptable, given that the section clearly provides that the nominee must act, in all respects, in accordance with the directions of the Minister.
There may be some confusion in relation to this section because section 4 (2) (a) (ii) provides that it shall be lawful for the Minister for Finance to direct a nominee to sell or dispose of all or any of the shares vested in him. There is, however, no similar provision in relation to the Minister for Agriculture and Food and his nominee. Indeed, the amendment the Minister introduced on Committee Stage, and which is now in section (2) (9), clearly provides that the Minister for Agriculture and Food shall not dispose of the special share. The Attorney General's Office confirmed this morning that this section stands alone. It expressly forbids the disposal of the share and no other provision in the Bill can be construed as permitting the disposal of the special share. I want to give this solemn assurance to this House that if any Minister for Agriculture and Food in the future wishes to dispose of the special share he cannot do so without this legislation being amended.
The special share is the real safeguard. We are talking about protection of the sugar quota and of growers and employees. The market is quite vulnerable to the importation of foreign sugar. We are all aware that there is some foreign sugar being used here to the disadvantage of our native industry. If we do not agree on this we will make our industry totally uncompetitive. The special share is the protection. Because of that the company cannot be wound up and the Minister and the Department has a function in it. There is full protection.
Why not write it into that subsection?
A new class of share is being created. The special share is the true protection and it is in the interests of this House, the growers, the company and the employees that we have this protection built into the Bill.
