Two Private Notice Questions have been addressed to the Minister for Enterprise and Employment. The Minister proposes to reply to both questions together. I now call on Deputy Theresa Ahearn and Deputy Richard Bruton to put their questions to the Minister.
Private Notice Questions. - Clonmel (Tipperary) Company.
asked the Minister for Enterprise and Employment the steps he intends to take to rescue Kentz Corporation in Clonmel and to secure the number employed, and so maintain the level of economic life in Clonmel, South Tipperary and nationally.
asked the Minister for Enterprise and Employment the steps, if any, the Government is taking to protect the jobs under threat in Kentz Corporation and if he has identified flaws in the Companies Act in providing machinery for allowing companies work their way out of trading difficulties intact.
I propose to take Deputy Ahearn's and Deputy Bruton's questions together.
A receiver was appointed to Kentz Corporation of Clonmel on Wednesday, 19 January last and subsequently an interim examiner was appointed by the High Court on Friday, 21 January. The receiver has indicated an intention to save as many jobs as possible. I am, of course, concerned for the future viability of this major Irish international group and for the continuance of employment by the group, particularly in the local area of Clonmel.
Following the announcement last year by my colleague, the Minister of State with responsibility for commerce and technology, Deputy Brennan, of our intention to carry out a review of the Companies (Amendment) Act, 1990, which provides for the appointment of examiners, submissions have been received from a number of interested parties identifying certain aspects of this legislation which they consider need to be amended. These suggestions are being examined at present and, if considered necessary, I will bring forward appropriate amending legislation. The fact that this examination is taking place does not, however, prevent the operation of the Act in the meantime. We have to await the outcome of the procedures before the High Court, but I will keep in close touch with developments through the relevant State agencies concerning the future of the Kentz Corporation.
In view of the importance and scale of today's business I will allow one round of questioning from the two Deputies concerned.
I want to inform the Minister of the level of panic and confusion which has arisen as a result of the appointment of an interim examiner and a receiver and the fact that some workers did not receive payment last Friday, as promised by the receiver. The closure of this corporation would be an enormous tragedy not only for Clonmel but also for Ireland, both nationally and internationally. Approximately 625 people from Clonmel are working in Kentz at present.
May I ask the Minister if the Government is prepared to propose or support the appointment of an examiner to this company and to ensure, if an examiner is appointed, that funds will be made available to enable him to operate within the examinership period? The Government could do this either by using its influence on the banks or perhaps by underwriting the payment of wages and salaries. In other words, I am asking the Minister the steps the Government is prepared to take to support the appointment of an examiner, which we believe is the best means of securing and maintaining the jobs in the Kentz Corporation and of ensuring payment not only for secured creditors but also for unsecured creditors. The knock-on effects of the closure of the Kentz Corporation on the people of South Tipperary and Ireland as a whole are immeasurable.
The Government is well aware of the importance of this international corporation, which is based in Clonmel, in terms of employment in the immediate locality of Clonmel and in the wider Irish economy. However, it is constrained by legislation and by the actions of the courts, and it has to await the decision of the court on Friday when the position of the interim examiner will be definitively established. After that decision the Government will review the situation and take whatever action is considered appropriate.
The Taoiseach, the Minister for the Environment and I have been in contact with the company. The Taoiseach has also met with Deputies Ferris and Davern who have brought to his immediate attention the extent of the concern about this matter throughout South Tipperary. We will keep the situation under constant review.
Meetings are all very well but the Minister has not referred to any initiative which would give solace to the workers in Kentz. Has the Minister any proposals as to how a successful examinership could work if the co-operation of the banks is not forthcoming? May I further ask him what role his Department's job protection unit, from which we expect a great deal, has played to date in regard to the threat to these jobs? Finally, is it not somewhat late for the Minister to be announcing a further review of an Act which has been plainly defective in its operation? Is the Minister not trying to close the door after the horse has long left the stable?
I will deal with the questions in the reverse order in which they were put. The review of the Companies Act is ongoing and I was not announcing a further review — perhaps the Deputy did not hear me clearly. We are considering on an ongoing basis the many submissions which have been received from different bodies concerning the operation of the Companies Act. I have already referred to this matter, and the Minister of State with the responsibility for this Act, Deputy Séamus Brennan, is actively engaged in this exercise.
In regard to the Deputy's second question about the competitiveness and employment protection unit of my Department, at no stage were we notified by Kentz Corporation of any difficulties it was experiencing prior to the appointment by the banks of the receiver. In regard to the first question, Deputy Bruton, of all people, must be acutely aware of the relationship between the courts and individual companies under the Companies Act and general legislation and that my hands are completely tied until such time as the court decides who is in charge of this company — the receiver or the examiner. All I can do is repeat the assurance I gave in my reply to Deputy Ahearn, that the Government will take whatever action it thinks is appropriate or necessary to maximise the survival of this very important company based in Tipperary, but we have to await the outcome of the court decision, which will be delivered next Friday.
That concludes questions for today.
May I ask a brief supplementary?
I must now move on to the next matter.