The position of my party was ably outlined last evening by our Transport spokesman, Deputy Yates. His speech was well researched and he ably demonstrated his control over the brief which he holds. He made many relevant points and I will add to them. Deputy Stafford last evening spoke about Dublin Port. I agree that the port needs to be developed and updated. We know that B & I over the years have played a major role in supporting the port. The traffic generated through the port by the company has been most welcome and beneficial. Much work needs to be done to the port, but perhaps that is a matter for another day.
My contribution will echo major concerns regarding the future of the employees of B & I. Those people have served the company well over the years and have been very loyal. Most will admit that the company's problems were not the fault of the employees. They worked hard and one must recognise the service they gave over the years. Many of the employees of B & I come from my constituency, from Howth, Baldoyle and Sutton. For many of them their first experience on the sea was in the Howth area as fishermen and they learned their trade very well there. I look on the B & I as the carrier for the north side of Dublin. We are very proud of the job the company have done. Many of their employees served their time as seamen and fishermen in the Howth area and became excellent employees of B & I. They worked very hard on behalf of passengers and carried out their business very well. Traditionally many seamen have come from the north side of the city.
I would like to refer to a very good friend of mine, an employee of B & I, who lost his life in the m.v. Kilkenny collision. He served his time as a fisherman and skipper in Howth. I refer of course to Dave Harding, one of the excellent employees of B & I. He worked very hard on behalf of the company and was very proud of the company. I was privileged to know him. I would like to extend sympathy to his family and friends.
I compliment the B & I employees who turned out in Howth on the day of his funeral — they were indeed a comfort to his family. Mr. Harding and I were school friends and we played football together. He was a proud, decent man who worked very hard for the company. As I said, he learned his trade in Howth, as did other fishermen who then went on to work for the B & I. I am very proud of all those in the Baldoyle, Sutton and Howth areas who work for the company and I want to ensure that they are treated fairly. I want to ensure also that they will have a job in the future.
Dubliners depend on the service provided by the B & I Line. Tourists travelling from Britain use the B & I Line and this is an important source of money for Dublin. It is not that the well-off travel on the B & I, but they carry the tourists who spend money in the country. The B & I cater for the man or woman who wants to take a camping holiday — I think the Americans refer to them as backpackers. They use this service in great numbers because it is cheaper than travelling by air.
B & I have also been to the forefront in catering for the motorist who may wish to bring his car and caravan with him. Over the years I have noticed that we cater for caravans and B & I deserve to be congratulated for the way they have served this segment of the tourist trade. They ensured that people wishing to take their car and caravan were able to get here and enjoy their holiday before returning home safely. B & I play a very important role in the tourist industry.
The company should have been more market oriented, but they failed in this regard in some respects. Aer Lingus, for instance, were able to diversify and over the years they went into various businesses, including the hotel business. A group from Aer Lingus visited members of my party in order to update us on the company's performance. I have been told that Aer Lingus enjoyed a business growth from 1986-91 of 100 per cent, for which they deserve our congratulations. Their core business, the passenger business, makes a loss of approximately £40 million but due to their diversification measures they achieved a profit of £22 million last year and have forecast a profit of £23 million this year.
If one were to criticise B & I, one could criticise their failure to diversify. I know they have made great efforts in the duty free business, which has generated some money for the company. They also tried to introduce other money making ventures on board the ships and they have to be congratulated for that. It is well known that the fares on B & I are cheaper than air fares and it should be possible to attract more people to travel by sea. It is nice to take a trip to Holyhead, spend the day there and then travel home. One can buy duty free goods on such a trip. B & I have tried to market these trips, but they should have done more and perhaps a better advertising campaign would have made it a more successful venture. Indeed, this question will have to be addressed again and the company will have to become more market oriented. Aer Lingus went into the hotel business, catering and aircraft maintenance and they are making money at a time when they are losing £40 million in their core business. B & I, the Irish carrier, should be doing likewise and they should look at other outlets associated with sea-going business.
Some years ago one felt a sense of excitement when the company decided to introduce a hovercraft service. They ran a marvellous advertising campaign and I well remember the claims that one could take a trip from England and land right in the middle of Dublin. That was a marvellous innovation and I thought the company were going places because there is nothing like coming from a foreign company and arriving at the centre of a capital city, practically beside O'Connell Bridge. Indeed, one could conduct a marvellous campaign and English people could be encouraged to come to Ireland at Christmas, Easter or during the holiday period, to do their shopping. Indeed, one reads from time to time that Europeans travel to England by ferry and spend lots of money shopping in London and in other cities. However, the vessel that the company had decided to purchase was not suitable for the Irish Sea and unfortunately they were not able to achieve the customer confidence that would enable the company to sell this service. Somebody will have to look at the possibility of providing a similar service again.
With the technological advances in recent times there must be a craft that would service this type of operation — that is a service that brings people right into the centre of Dublin, they travel up the Liffey and land opposite the Custom House. I know that the depot used at the time is still there. I think this offers an ideal opportunity to make money. It offers an ideal opportunity to boost the tourist industry and I suggest that the company should not feel embarrassed that the previous venture failed but should try it out again. Even if the State had to support such a venture, I am sure that all parties in this House would support that.
Ireland is a nation that depends solely on its ability to export in an efficient manner. In order to serve Irish industry, Irish exporters and Irish tourism, and as a nation on the periphery of Europe, with our neighbour and competitor having direct access to European markets through the channel tunnel, which will commence operations in the very near future, Ireland should and must have control of shipping. The B & I Line have fulfilled that role over the years and have serviced the vital container service and cargo links from Dublin Port to Antwerp, Rotterdam and Le Harve as well as our vital links with England, especially Holyhead.
In 1965 the Government bought the B & I Line to protect delivery to export markets. Today the line is still a vital shipping conduit to our European markets. At that time the line was purchased as a strategic national interest in the State having involvement with shipping services. We in Fine Gael maintain that the Government should retain the stake in the B & I Line and protect our vital interest by holding a golden share.
When the Government heretofore set about privatisation under measures such as the Irish Sugar Company Act, which established Greencore, the State ensured that its ownership would be reduced on a gradual basis. The Government currently retain 45 per cent ownership in Greencore.
I believe that Ireland must safeguard its vital markets abroad. They will be protected by retaining State control in Aer Lingus and in the airports and sea ports. I wonder why the Government are abandoning such vital interests in the flog off of the B & I Line.
An amount of £26 million of taxpayers' money is being written off. I consider that Irish Continental Group have succeeded in the softest takenover in the history of the State. The B & I Line, a State company, this year made a trading profit of £2.5 million and it is to be sold off for just under £8.5 million while its debts totalling £35 million will be written off by the Government.
I cannot understand the Government's haste in selling off the company when one takes into consideration the fact that this vital State shipping company has been turned around from an operating loss of £3.5 million in 1987 to a profit of £2.5 million this year. Over the same period the company were successful in reducing overheads and reduced staff numbers by nearly 400.
It is the workers who suffer — 400 employees have been laid off. They are the decent people who served their time in Howth, as I said before, they are sea-going people who offer expertise and tradition. It is not right that they are the people to suffer all of the time and be laid off.
What is the future for the present staff of the B & I Line, numbering about 1,000, including 123 temporary employees? In the new set up it is intended to reduce staffing levels to about 650. Again, it is the employees who are suffering. The great tradition of seafaring will be lost.
I know that Britain always prides itself on being a seafaring national, but so do we. As an island nation Ireland produces some of the best sailors in the world. This country has excellent institutions for training seamen, and most of them who start in the fishing industry get the best general seamanship training in the world. They are the people who make up the personnel of B & I. Through all of the lay-offs our nation is losing the vital ingredient of personnel who work on the sea, know the sea and know how to look after passengers. The staff lose out all of the time.
I understand that senior management is to be virtually eliminated and replaced by ICG staff. Also to be eliminated is 42 per cent of clerical jobs. Maintenance employees are to be replaced by contractors. Will the Minister protect those jobs? Will he ensure that those jobs will be there in the future? Can he guarantee the protection of the pension fund and the rights of pay and continuity of service for those workers in the new set up? I think not. If the workers are to avoid a bleak future on the ever lengthening dole queues, the Minister must make it a condition of the purchase deal that any job losses will be strictly on a voluntary basis.
I wonder why the Government were in such a hurry to flog off the B & I Line in the first place. In my opinion, ICG is a smaller company with a turnover of £40 million, 250 staff, assets of £30 million and a fleet of two vessels. How could that organisation acquire a company such as the B & I Line, with a turnover of £70 million, a much larger fleet and a staff of approximately 1,000 persons? This deal is not a merger but, as I said before, one of the softest takeover deals in recent times. Surely the staff-management buy-out would be in the best interests of preserving a truly Irish shipping line and thereby protecting and maintaining the vital interests of Irish manufacturers, Irish exporters, Irish tourism and, more important, Irish jobs.
Fine Gael are opposing this Bill because we feel that the purchaser of the B & I Line has obtained a bargain basement buy. In the deal £36 million is to be written off, all of the assets of the B & I Line are to be clear of liabilities, there is a pension fund valued at £60 million and B & I have a surplus of between £6 million and £13 million. ICG will have the freedom to bargain away up to 350 jobs by way of redundancy, they will have access to the EC for shipping grants and they will be able to use the argument that Ireland will be the only State without a land link after the channel tunnel is completed in 1993. ICG will get all of that for a mere £8.5 million.
We in Fine Gael believe that that price is much too low. We feel that the Minister is simply abandoning the B & I Line. That is completely unacceptable. Irish Ferries say that they will invest £32 million over the next five years and that they intend upgrading the m.v. Leinster, which serves the Dublin-Holyhead route. They also intend replacing the m.v. Munster at a cost of £20 million. The organisation anticipates making losses for the first three years but making money in the fourth year. It is also proposed that Irish Ferries will spend £1 million on upgrading facilities at the North Wall terminal.
I am not out to condemn the company proposing the takeover. I know that they do an excellent job. I know that they are a small company. I know that they are good at business — they must be because they have proved it with profits, which is the way to measure any company. If a company are making profits then they have a right to succeed, they have a right to go ahead and buy out other shipping lines. However, I consider that ICG are not paying enough for the B & I Line. It is my opinion that the Minister was very foolish to allow such a good company as the B & I Line go for such a small price.
All of the above proposals are very welcome in the context of the future of the B & I Line if the merger takes place and the kind of money referred to is spent.
We should now consider the possibility that the company's competitors would ever be in a position to force a takeover. Perhaps competitors would have ambitions to create a monopoly in Irish shipping. What if the company's competitors were faced with a price war and the company could not compete, the end result being closure? Would the Government have power to act in the protection of our vital shipping interests? In that respect I am talking about competition. For any company to succeed they must be aware of the need to make profits. If a monopoly were created on the Irish Sea there would be no encouragement for any company to compete and make profits. That would not be good for Ireland. As I have said before, we depend on our shipping lines. If there is no competition then shipping would be expensive and our export goods and tourism would be much dearer. We should not allow that. We should ensure that competition on the Irish Sea remains. I know that the B & I Line are well able for that competition if they are given the wherewithal to compete.
I suppose what we are talking about is proper investment because the employees have worked very hard on behalf of the company for many years. Perhaps there was not the proper investment in the company. Perhaps the State did not give them the proper support in money terms; that may be the reason. We know that the management have been excellent and have done a great job in turning the company around into a profit-making one, for which they should be congratulated. We should not discard management, who slaved over the years to convert the company into a profit-making one. It would not be fair that they should be placed on the scrap heap. Rather their position should be examined and protected. It is the business of the State to do so.
It is generally agreed that the B & I's competitors on the Dún Laoghaire-Holyhead route have superior vessels in the m.v. Stena Hibernia and the m.v. Felicity operating on the Rosslare-Fishguard route. Over the next five years Irish Ferries will have to replace the St. Killian and the St. Patrick, involving the company in a large outlay. In such circumstances, will the company be able to survive or will the Government have to mount a rescue operation with large amounts of money?
The Minister has rushed the introduction of this Bill. I am convinced that had he spoken in greater depth with the management and staff about their buy-out, he would have obtained the money he required; I am sure it would have been forthcoming from them. The Minister should be aware that any Bill rushed through inevitably amounts to bad legislation.
We will be tabling amendments on Committee Stage. We will be voting against this Bill because the buy-out has been struck at such a cheap price. We contend that, had the Minister managed his business better, he could have got more money for the company.
