Dáil Éireann debate -
Wednesday, 28 Jun 2000

Vol. 522 No. 3

Harbours (Amendment) Bill, 2000 [ Seanad ] : Second Stage.

An Ceann Comhairle:

Before Second Stage commences, I would like to deal with the question of this Bill being a hybrid Bill, which was raised in the House previously.

I have given careful consideration to the issue of whether the Standing Orders relative to Private Business are applicable to the Harbours (Amendment) Bill, 2000. The Bill deals primarily with matters of public policy, and in so far as private interests could be said to be affected, they are affected in a manner incidental to that policy and, accordingly, I will not refer the Bill to the Examiner of Private Bills.

Minister for the Marine and Natural Resources (Mr. Fahey):

I move: "That the Bill be now read a Second Time."

I am delighted to have the opportunity to introduce this Bill. It has been a long time in coming. It is 25 years since the idea was first mooted. It is interesting that on a number of occasions the Bill was held up by the intervention of a general election. I am glad that will not happen on this occasion and that we will get this very important legislation through the House.

I published the KPMG Consulting review in March this year and fully supported the recommendations of that report.

The consultants came to the conclusion that the establishment of a new and single port company "is the only arrangement that makes commercial and operational sense". The report recommends that the company, to be called the Shannon and Foynes Port Company, will be responsible for all port related activity in the estuary. The Harbours (Amendment) Bill amends the Harbours Act, 1996 to provide that if the Minister is of the opinion that the functions of a company or companies could be performed in a more cost effective and efficient manner by another company or companies, he may establish a new company resulting in the amalgamation of existing companies. The Bill enables the Minister to amalgamate the functions of Foynes Port Company and Shannon Estuary Ports Company. It also provides powers to the Minister to establish an Implementation Board and Advisory Boards to facilitate the transfer. The Bill allows the Minister for Finance to make available to a company moneys to finance capital works, to inject equity for other purposes and to raise the aggregate amount of moneys that can be made available to companies.

I recently announced the establishment of a five-member Implementation Board, on an informal basis initially, pending enactment of this legislation, under the Chairmanship of Mr. Proinsias Kitt of Kitt, Noone Chartered Accountants, to initiate the process of overseeing the transition to a new single port company. The other members on the board are Mr. Kieran McSweeney, Mr. Michael Leyden, Ms Susan Bugler and Mr. Kevin Sheehan.

The Advisory Boards, comprising the directors of the Foynes Port Company and Shannon Estuary Ports Company, will have a real and important role to fill. There will be a serious obligation on the advisory boards to assist in every way in the achievement of the main and subsidiary objects for which the company is established and to tender any advice sought by that board on matters relating to: measures for the management, control, operation and development of the estuary port facilities; the provision of facilities, services, accommodation and lands in its jurisdiction for ships and goods; the promotion of investment in its facilities; the engagement in business activity considered advantageous to the development of the estuary; and the utilisation and management of scarce resources.

I am aware from discussions both with the staff and management of the two port companies and from discussions with Members of this House that there is a genuine sense of grievance as to certain comments made in the report by the consultants who undertook the Shannon Port industry review. I refer in particular to the comments on the financial position of both ports, the cashflow difficulty at Foynes and the pensions deficit at Shannon. I recognise fully that there are sensitivities here. It has been pointed out to me that dedication, service and commitment shown over the years by the staff members of both companies and their predecessor harbour authorities were not given sufficient credit by the consultants. Following a board meeting on 20 June last, the board of Foynes Port Company forwarded to me a summary of what it perceived as inaccuracies in the KPMG report. I have asked my Department to pass this on to KPMG Consultancy.

When both port companies were set up in March, 1997 it was without any financial support from the State. The balance sheet positions were inherited by the companies and both had to operate within a very competitive environment from vesting day onwards.

While it is now time to put the past behind us and move on to a new future, both boards and management will be given an opportunity to vindicate their stewardship since the port companies were formed in March, 1997. Statutory performance audits covering the first three years' trading, to be conducted by independent consultants, will be initiated very shortly with a view to completion within a three-month time frame. These will apply to all port companies, including Foynes and Shannon, and in view of the concerns expressed about aspects of the KPMG report, I am sure priority can be given to the Foynes and Shannon audits.

Although investment in ports has greatly improved, thanks to EU Structural Funding, the capacity and quality of port facilities, the level of growth in Ireland's international trade and in port activity means that continued investment is required which will be funded in the future through the ports' own resources, available EU co-funded investment, shareholder's equity, public-private sector partnerships or a combination of these funding mechanisms.

Among the tasks of the implementation board overseeing the unification process, which I appointed on an informal basis pending enactment of the new legislation and establishment of the new port company, will be the need to establish the level of equity that is required to ensure that the new company can trade solvently. KPMG Consulting assess this to be in the order of £5 million to £8 million. The implementation board will investigate the full extent of planned capital works at both ports, the restructuring of loans, private sector involvement, port re-organisation and possible disposal of assets surplus to essential core business so that I can have a fully developed and costed assessment of the financial requirements necessary to enable the two companies to unify into one whole and start with a sound balance sheet.

The cashflow difficulties at Foynes Port were underlined by the qualified opinion given by the company's auditors in their 1999 annual accounts. This highlighted the reliance of the company on the support of its shareholders, bankers and creditors. Further, the auditors stated in the published accounts that if such support was not available to the company the going concern basis on which their accounts are prepared may not be appropriate. I am underlining this so that Deputies will appreciate the need for action here. It goes without saying that the State as shareholder maintains support for the Foynes Port Company and adopted the 1999 report and financial statements accordingly.

An urgent priority already identified is to address the critical deficiencies in craneage and handling facilities at Foynes which could cost up to £3 million. The eventual cost will depend on completion of the competitive procurement process which has just been embarked upon by the Foynes Port Company. They cannot afford to buy this equipment themselves because of their acute cash flow problems which I have just mentioned, having invested heavily in the EU co-financed west jetty extension and dredging development, costing £12.5 million. They now have the capacity to load and discharge more and larger ships, but without the handling equipment the day to day business is hampered, current business is constrained, they cannot trade out of their difficulties and new business prospects are diminished. I confirm to the House that I will be making an announcement as to how we will address the issue of the necessary moneys for the new company to meet the cost of the essential craneage and handling equipment.

At a very early stage of the review process my Department confirmed the position in writing to both port companies that all the employment protections as to salary scales and conditions of service guaranteed by the Harbours Act, 1996, for the members of staff of the predecessor harbour authorities would not be affected by any potential changes to management or operational structures, and this remains the case. A key remit of the interim implementation board is to deal with staffing concerns or issues. I am on record as saying there will be no forced redundancies. Where staff economies or rationalisation become apparent to the implementation board, a scheme of voluntary redundancy will be put in place.

The proposed Limerick southern ring road will cross the Shannon at a place yet to be decided. There is a decision to be made in relation to the type and form of a new Shannon crossing. This must not restrict the development and long-term viability of the Ted Russell Docks, not only from a commercial perspective but also as a facility for water-based tourism. The potential for Limerick docks must be recognised given that its location takes significant break bulk traffic off the road. Up to now the facility was hampered by lack of warehousing, but this is being addressed in developments planned and under way by Shannon Estuary Ports Company.

An urgent priority already identified is to advance the construction of the port access road at Foynes. I understand the original scheme for which there is planning permission was costed at some £1.6 million. Extra works have arisen comprising realignment of the N69 and a level crossing at a cost of £1 million. The National Roads Authority will provide £0.3 million of this in addition to the grant aid already committed, leaving a requirement for an additional allocation to Limerick County Council of £700,000. I fully appreciate the importance of completing the Foynes port access road having visited the port and spoken to the local community council. I have initiated discussions with the Minister for the Environment and Local Government on providing the necessary funding when required to Limerick County Council for the purpose of constructing the access road and I am confident the money will be forthcoming. In addition, the improvement of the N69, which is especially relevant for the development of the port of Foynes, is scheduled under the national development plan. Significant remedial works are, I understand, currently under way on the N69.

The hallmark of the implementation structures provided for in the Bill is that they are designed to be simple, effective and non-divisive. It is of vital importance that the implementation board which will have a short shelf life is tightly focused and for this reason I decided to keep the numbers low, with balanced representation from each company and an independent chairperson. It also has a clear-cut and focused remit overseeing the unification process in close liaison with the port company boards and their successor advisory boards in order to ensure the smoothest possible transition to a new single port company structure.

The advisory boards, comprising the directors of two or more port companies amalgamated, including the employee directors and local authority directors, will have a real and important role to fulfil in assisting the implementation board of the new company to pursue the difficult decisions vital to the future success of the company and the development of business and the port facilities. This arrangement maintains equal and balanced representation of the interests of each of the amalgamating companies while ensuring the vital focus on the part of the implementation board.

The implementation process should be completed within a 12 to 18 month timeframe and in terms of the proposed amalgamation of the Foynes Port Company and Shannon Estuary Port Company, I hope the task can be completed within the shorter period, when the normal board structure would come back into play.

As I said, this is a major development initiative for the Shannon estuary with a range of significant benefits identified. These include the provision of a single coherent voice to the marketing of the estuary ports by a more focused management, greater efficiencies and economies of scale, allowing a more structured approach to infrastructure development as well as a more rational approach to the best use of terminals and assets. It is anticipated that port charges will be reduced and that the new single port company will be better positioned to address the current and potential business opportunities that the estuary offers the mid-west region and the State.

As a shareholder, it is my responsibility to ensure the State's port industry assets are deployed to best effect and that the business is competitive, responsive to customer's needs and operates on a sound financial footing. Above all I want the port industry to be a focal point for development of the estuary as a whole and to deliver to the best extent possible on its potential. It is imperative if this major change is to be successfully carried through that the legislation is enacted as a matter of the highest priority. It is my conviction that we must maintain momentum. The customers of both port companies want the new structures to be put in place quickly and efficiently.

It is my intention as soon as the Bill becomes law to proceed with making the necessary ministerial orders to set up the new single company, name it, enshrine the headquarters location as Foynes and all the other matters needing determination such as capital formation etc. I wish to reaffirm my earlier commitment that the headquarters of the new port company will be in Foynes. I am leaving the suggested name for further discussion with the advisory boards and the implementation board. This is the most significant ever development for the Shannon estuary. As I said before, we have a fantastic natural resource which is totally undeveloped. I want it to become the premier port in Ireland and to take away traffic going to the west and south-west and especially to Dublin port. I want this to be the main port for the south-west and west. Foynes is a unique deep water facility and already I have had a number of inquiries about possible investment in the Foynes area as a result of the creation of a new single port company. There is immediate and significant development potential for the Foynes and Limerick areas and we will deliver on the commitments we have made.

I commend the Bill to the House.

Mr. Finucane:

I wish to share time with Deputy Deenihan.

An Leas-Cheann Comhairle:

Is that agreed? Agreed.

Mr. Finucane:

I welcome the Bill. As the Minister said, the legislation has a long and chequered history. The original proposal goes back about 25 years and over a period of time it was opposed by the Opposition. One must recognise that we are in a new millennium and that things move on. I have adopted a very pragmatic approach to the legislation from the outset and had many discussions with the Minister. Obviously I believe that what is happening is essentially good for the estuary, for Limerick and particularly for Foynes. I regard it as especially important for Foynes in the context of the west jetty development.

I welcome the fact the Minister said it is impossible for Foynes to proceed with craneage and dust hoppers and to find 50% of the funding because of the financial situation of the company and the development of the west jetty. I ask the Minister to move with haste in terms of advancing the finance for Foynes to provide both the craneage and hoppers which are urgently required.

It is well known that my family made a major contribution to the development of Foynes over the years. My father, who has been dead for a few years, was a harbour pilot for a long time in Foynes and, therefore, I have a tremendous interest in seeing Foynes making good progress and proceeding with the advances made over the years.

When the KPMG report was first proceeded with in November 1999, with the consent of the Minister's predecessor, Deputy Woods, it was easy to predict its outcome. I predicted it would come to the conclusion that the best way forward was one single estuary authority. I was well aware that senior officials in the Department of the Marine and Natural Resources had favoured this course of action over many years and were disappointed it had not evolved. I am disappointed with the report in the context of Foynes itself and am glad the Minister has corrected the situation in his contributions in the Dáil and Seanad. There was much criticism in the report and much of the focus seemed to be on the finances of Foynes port. Insufficient attention was paid to complimenting the board on building a very strong asset base without great assistance from the State. It was regrettable that the report seemed to focus very much on the negative rather than on the more positive aspects.

Foynes port has been a vital component in the creation of essential deep-water facilities on the west coast. It has developed because risks have been taken and now has sheltered deep-water facilities second to none. It alone provided a mechanism to the State to identify a project which would benefit the mid-west and western seaboard by obtaining EU funding of £5.8 million for its west jetty deep-water project. This finance was approved by my colleague, Deputy Barrett, when Minister for Defence and the Marine.

The port, which the Minister has visited, is a vibrant hive of activity. He will no doubt agree that it is a major achievement that a port of this size has been created in a little west Limerick village when all of its competitor deep-water ports are situated in large centres of population close to the United Kingdom and continental Europe.

I am justly proud of all those who have contributed to the success story that is Foynes. Its opposition to amalgamation until now has not hampered its development. All concerned have forged ahead to create the only major State asset on the estuary. Given the millions of pounds invested by the State in Dublin, Cork and Waterford compared to a sum of less than £600,000 in Foynes in its 110 year history and the battle it has faced with substandard road access throughout the 1980s and 1990s its achievement is unique.

Thankfully progress is being made with regard to improvements to the N69 route. In seeking the necessary approval of his Cabinet colleagues for the required works, the Minister drew attention to the need for an access road through Foynes and indicated that he would have discussions with the Minister for the Environment and Local Government, Deputy Dempsey, to ensure the necessary funding would be provided in the short-term. I regard this as an essential component to sustain the goodwill of the people of Foynes who have been very tolerant during the years with regard to spillage and heavy traffic on its main streets generated by port business. Consistent with his commitment I urge the Minister with his colleague, the Minister for the Environment and Local Government, to accelerate the required funding for this much needed access road.

I have been informed by the Minister that he intends to provide for significant capital investment in the port. His acknowledgement with regard to cranage and hoppers is a step in the right direction. I hope the news will be announced shortly. The Minister has also expressed his favourable view of the performance of the port to date. This is appreciated. I have adopted a pragmatic approach to the Bill because of the assurances given. They relate specifically to the socio-economic wellbeing of Foynes which is the economic nerve centre for a hinterland stretching from the north Kerry border 13 miles to the west almost to Limerick city. Its importance is based solely on it being the premier deep-water facility on the estuary. It is dependent on the Minister and the implementation board taking correct, prudent and wise decisions for its continued success.

I do not speak solely about the economic wellbeing of the new entity but of the microcosm of social partnership which has developed successfully in Foynes since the 1950s between the port company, port users and dock workers. There is a strong social responsibility on the Minister, as shareholder in this new entity, to ensure their efforts are protected. No impediment should be placed in his way. This would be a sign of good faith with regard to his intentions.

Since the launch of the KPMG report much has been made of the cash flow difficulties which have arisen in Foynes following construction of the new deep-water facility. The projected overrun of approximately £3 million is due largely to unfavourable ground conditions undetected during geological surveys and not the fault of board and management. I remind the Minister that, as shareholder, he is responsible for all equity invested in the company. A significant injection is required to remedy the lack of investment in the past. The Minister will agree that if the shareholder is not providing equity the only other alternative is to borrow for capital projects. In short, far from being critical of the board and management I would have been far more comfortable if KPMG had praised the company for providing the Minister with a £50 million asset between marine and industrial infrastructural facilities for a total State investment of £571,000. It was a very prudent investment on the part of his predecessors.

As a board member from 1985 to 1995 I wit nessed at first hand a committed team from board level to the dock workforce. What made Foynes port unique was the pride taken in doing the job better and generating growth for which I pay tribute to all concerned. The Minister will no doubt ensure all the positive attributes which have made Foynes the major port on the west coast are brought to fruition. I will keep an ever vigilant eye on developments to ensure the commitments given to the port are honoured.

Many members of the dock workforce have worked on a casual basis all their working lives. Because of proposals to alter work practices they face an uncertain period. The recent Baxter-Eadie report on capacity studies projected a tonnage level through Foynes of about 3 million tonnes within a few years. Where changed work practices impact on dockers it is vital that the implementation committee ensures appropriate and adequate compensation is paid. I will monitor the situation closely to ensure there is fair play.

The Minister recently received correspondence in connection with improvements carried out by Foynes Yacht Club at Cooleen Point. The works were undertaken in conjunction with the capital dredging programme which was part of the west jetty extension project. To facilitate the provision of a successful and comprehensive navigation channel the yacht club engaged in a refacing project to enable the dredging company proceed with the deep-water project to its maximum potential. The Minister's predecessor, Deputy Woods, wrote to the yacht club on 22 June 1999 following a meeting with a deputation from the club indicating his goodwill and outlining his intentions for the financing of the works.

Foynes Yacht Club was founded in 1962 and has 70 members. As a result of the improvements and its future development plans it has received numerous inquiries from prospective members. It has expended approximately £25,000 to date but it will take a further £11,500 to complete phase one of the project. The yacht club urgently requires finance to meet the commitments entered into based on the goodwill of Deputy Woods to the project. The local community has shown much goodwill to the merging of the harbours and the Minister has scope to provide the necessary finance. He has scope under the Marine Casualties Investigation Bill passed by the House recently to assist marine related projects. I welcomed that Bill as a step in the right direction. I was always of the view that the Department sought to fund such projects in conjunction with other port related activities. The Minister has the scope to help Foynes Yacht Club and I hope he will do so.

I welcome the Minster's assurance that the headquarters will be based in Foynes. He gave this assurance in response to a priority question, in his presentation at the Ryan Hotel in Limerick at the launch of the KPMG report, in the Seanad and here this evening. In the Seanad he stated that it would not be good legislative practice to enshrine in the legislation that Foynes be the administrative, commercial and operational headquarters.

However, in a similar Bill in 1988 it was enshrined that the headquarters would be based in Foynes. What has changed between 1988 and now? I believe the Minister has encountered opposition from his Department. I will be pursuing this by way of amendment on Committee Stage because it is possible to enshrine it in the legislation and copperfasten what the Minster stated. Ministers come and go and circumstances change. The legislation should copperfasten this. There is no impediment to doing so unless the Minister has reached an impasse with his officials, who in the past would not have been sympathetic to Foynes.

I hope the Minster ensures this provision in the legislation. We have a high regard for the Bill and for its importance for the future of the estuary. The Minister may object that the acceptance of an amendment on Committee Stage tomorrow will necessitate the Bill returning to the Seanad. I understand the Seanad will meet on Friday and may possibly meet on Monday. I am sure that with the Minster's co-operation such an amendment would be passed. Overall, I welcome the legislation. It sets out the right direction for the future prosperity of the estuary.

Mr. Deenihan:

I wish to share my time with Deputy Neville.

An Leas-Cheann Comhairle:

Is that agreed? Agreed.

Mr. Deenihan:

I compliment the Minister on his initiative in introducing this Bill. This is the third Shannon estuary ports Bill I have addressed since I came into politics. I remember the Mitchell initiative in the mid-1980s when I addressed the relevant Bill at length in the Seanad. In 1989 I spoke on the Bill sponsored by Deputy Daly for approximately two hours. I am familiar with the history of the legislation relating to the Shannon estuary.

I hope the Minster will return to the House before I finish. In the meantime I ask the Minster of State to listen to what I have to say. I have an interest in the County Kerry point of view. Why did the Minister not appoint a representative from County Kerry to the implementation structure? Counties Clare and Limerick are represented, but there is nobody from County Kerry on the five man board. It is inexplicable.

In his contribution to the debate on the Bill in the Seanad, the Minister referred to the Shannon estuary. He stated that he had asked Shannon Development Company in conjunction with Shannon Estuary Ports Company to explore the possibility of establishing a terminal adjacent to Shannon Development Company's landbank near Ballylongford in north County Kerry. The Minister's speech to the House tonight is similar to the one he made in the Seanad, but he omitted this aspect. Has he forgotten about the landbank or has he obtained advice that the terminal would be a non-runner? What is the reason for the omission?

I agree with the Minister's statement that the access road to Foynes needs to be upgraded. I travel this road on my way to and from Dublin and it is not only very dangerous, but the surface and alignment is not acceptable.

The N69, a national secondary road, is the lifeline of north County Kerry. It runs from Tarbert to Tralee. There is no national primary road. The investment should not stop at Foynes. In whatever programmes or schemes for the road the Minister proposes, I appeal to him to include Limerick to Tralee via Foynes. That is very important from a north County Kerry point of view.

When I was Minister of State I established the Shannon estuary strategy group in March 1996 to focus on the landbank in Tarbert and Ballylongford. It comprises over 660 acres of State land. There is also private land attached to it, approximately 1,000 acres in all. It is not in use, in some instances that has been the case for more than 30 years. Farmers were forced to leave the landbank, their milk quotas went with them and it took away a very important part of the local economy, which has never recovered.

I established the strategy group to bring all the main players together, including the Department, the IDA, Shannon Development, Foynes Harbour, Limerick Harbour and other agencies. This resulted in the establishment of the Shannon Estuary Development Company in September 1997. It produced a position paper by Price Waterhouse in November 1998, which contained a number of important recommendations. The company sought a meeting with the previous Minister, Deputy Woods, but he refused. As a result the company lost its momentum and it has not met for almost a year. I went to a lot of trouble to have this company established. It had to be accepted by the Department of Finance and it was only accepted because it had a brief to do something about the land the State acquired at a very high cost in Ballylongford and Tarbert for development purposes. Will the Minister explain why the company has not met in the past year? Perhaps he has no brief on it. Will he consider making it a subsidiary of the new company he is proposing to establish? That would be important. We will consider an amendment to this effect for Committee Stage because I strongly recommend that this be done.

I am convinced that nothing happened on the Tarbert-Ballylongford landbank because of the attitude by the other stakeholders in the estuary. Limerick Harbour Commissioners were more positively disposed towards the landbank than Foynes Harbour, which was never over-enthusiastic in allowing anything to happen in the estuary beyond its control. One operator made an application for a harbour between Foynes and Tarbert. It was objected to and Foynes Harbour was not enthusiastic about it.

I compliment Foynes Harbour on its achievements. We would certainly recognise the contribution the Finucane family made to the development of Foynes Harbour in the past, but in the new scenario of goodwill, where all the stakeholders are obviously co-operating, that Tarbert-Ballylongford land bank should not be marginalised or excluded from any future plans. It worries me that the Minister made a major issue of this landbank in his Seanad speech and it was omitted from his speech tonight. He made almost the same speech on both occasions.

Between contributions in the Seanad and in this House, I have made contributions of about four hours on this matter and therefore I need not add any more here. What I said about the Shannon Estuary and the Tarbert-Ballylongford landbank in 1984 still holds.

There are just two points I want the Minister to address. Large containers come up the river to Moneypoint, for example, and the Minister asked Shannon Development to carry out a review of the potential for establishing a container facility on the Tarbert-Ballylongford landbank. Will he give us the up to date position on that tonight? It is important that he enlighten us in the regard.

I welcome the Bill. We will get another opportunity to discuss it tomorrow. There is a great deal at stake here for that region, particularly, from my point of view, for the Tarbert-Ballylongford area.

Mr. Neville:

I thank Deputies Finucane and Deenihan for sharing their time with me. I also welcome the Bill. It took some persuasion for me to change my mind having believed fervently for many years that the best interests of Foynes lay in having an authority in charge of Foynes. I believed that because of the success of the boards. Like Deputy Finucane, I was on the board from 1985 to 1998 and I was aware of the success of Foynes in the context of the ports of Ireland. It was far in advance of many other ports in Ireland. It was our most efficient port at one stage but with rationalisation and the restructuring of other ports it has dropped from the top spot. This proposal has the potential to bring Foynes back up to the level it maintained two decades ago.

It is important that the work done is recognised. Much of it was done with little investment from the State which owned it. Most of the investment was undertaken from the port's resources. It raised finance and often made decisions which looked risky at the time but turned out to be wise. At one stage we decided to purchase land for development and many people were sceptical about that but within two or three years all of that land was developed, resulting in extensive activity.

I am pleased the Minister corrected the KPMG report's comment on the financial viability of Foynes which is reckoned to have assets of about £35 million. Many of those assets, warehousing, etc., are disposable. While I do not accept that they should be disposed of, if finance was needed urgently they are available for disposal without compromising the activity of the port.

More attention should be paid to marketing the port. There was not enough emphasis on international marketing of the port, and marketing was weak. That is improving and will continue to improve, and I compliment the current chief executive, his team and the board for ensuring that marketing is being examined as there is great potential there, as there is for offshore oil exploration. It is unfortunate that these ventures are not operating out of Foynes, but we do not have time to discuss this here.

Deputy Finucane referred to the possibility of addressing the position of the dockers. I have been saying that for years, but it cannot be done without the agreement of the dockers. I was involved in industrial relations for well over 20 years. I know there is no way one can impose an agreement. It would be unjust to impose a system without the full co-operation and agreement of the workers directly involved. I urge the Minister to ensure that that is fully recognised by him and that the finance is made available to do it.

I bring to the attention of the Minister that last Monday, Limerick County Council proposed and it was accepted unanimously that three councillors from County Limerick would be on the board. The Minister in the Seanad stated that he would consider that issue, but again I raise it. It has the full support of Limerick County Council. It was stated that the headquarters of the new estuarial company will be in Foynes. That would be a pre-condition for any acceptance of the authority by anybody in Foynes.

When he spoke at Limerick County Council, the then vice-chairman of Foynes port company stated:

"we believe the State investment should consist of £40 million over five years together with State commitment to invest £30 million on the N69, together with upgrading of rail work. We believe that a duty free zone concept should be pursued, that Foynes should expand its management structure, that it would be desirable that three Councillors from Limerick County Council would be on the Board, . ".

That was the view of the board at the time. We were looking for an investment of £40 million and the upgrading of the N69, which we have asked for repeatedly in this House at every opportunity. It is vital for the success of Foynes that the N69 is upgraded.

Ms O'Sullivan:

I wish to share my time with Deputy O'Shea.

On behalf of the Labour Party and particularly as a Deputy for Limerick East, I too welcome the legislation. Merging the two authorities, the Shannon Estuary Ports Company and the Foynes Port Company, as a result of the Bill will be for the good of the region as a whole. I congratulate the Minister on bringing the legislation before the House.

As the House will be aware, the estuary is an area of huge potential for the economy of not just the mid-west but of the country. It is a fine deep sheltered port, capable of handling ships of up to 200,000 tonnes at present and possibly more, if action is taken with regard to the bar at the entrance to the estuary.

It will offer a number of opportunities in the area, particularly the opportunity to develop further co-operation. In recent years the level of co-operation has increased greatly regarding daily operations, piloted tugs, the anti-pollution team which was set up and operates successfully, the oil-spill tracking which has been implemented in the area and the general running of the operations of the Shannon Estuary Ports Company and Foynes Port Company. This is the first time there has been agreement locally on the amalgamation of the two ports. Obviously this is the opportune time to bring that into effect. If work is not duplicated, it will help greatly and we would all support that.

As Deputy Neville stated, what is happening will offer potential in a number of areas. I also emphasise the opportunities to develop the port and market it as a port of great potential if it had much greater capacity than it does at present. There is a great deal more to it than simply the Ted Russell Docks and Foynes. Most of the tonnage comes through Aughinish and Moneypoint which are further down the river. Other strategic areas, such as Kilrush, also have much to offer in the development of the port, as does the north Kerry coast to which Deputy Deenihan referred. It must be seen as a whole and there should not be a concentration on the potential of specific parts of it.

It must also be seen in the context of the Shannon river as a whole. The river north of Limerick will be opened to a much greater extent because a navigation scheme is being developed in Limerick at present. Those who visited Limerick recently will have seen that there is practically no water in one section of the Abbey river in the centre of the city. This is because the river is being deepened and that work is being carried out in conjunction with the main drainage scheme. It will result in both pleasure craft and other boats being able to navigate the Shannon to its source. This offers a great potential, so it should not be seen purely in terms of the estuary, rather as the entire Shannon basin and estuary offering the potential for development, something I hope we will be able to grasp.

We adopted various water quality management plans for the upper Shannon, the lakes, the lower Shannon and the estuary. All these projects need to be co-ordinated in terms of the water quality and also the various uses to which they can be put. Deputy Finucane referred to yachting, which is one use, but there are many other potential uses. For example, I understand there are dolphins in the estuary on the Clare side and a new sport of dolphin watching has developed there as well as in Dingle.

The main use is, obviously, trade, that is, importing and exporting goods. Figures suggest that more than 80% of imports and exports come through ports rather than by other methods. The 1999 throughput for the Shannon Estuary Ports Authority was £8.7 million and it was £1.3 million for Foynes. Taking both together, that represents a sizeable amount of trade. With vision and a strong marketing strategy, which I hope the Minister will be able to support financially, that can be greatly developed. It is an area of huge potential. There is a great deal of unused land on either side of the estuary and that can be developed.

Within my area, the Ted Russell Docks in Limerick are of particular concern. I seem to be the only Limerick East Deputy in House. I hope others will contribute before the debate is over. It is important that the Ted Russell Docks are protected because there is a significant and important trade through them with Limerick and the surrounding area. The Minister referred to the fourth crossing of the Shannon and said it must not restrict the development and long-term viability of the Ted Russell Docks, not only from a commercial perspective but also as a facility for water-based tourism. I welcome that, but I would like him to go further and give us a commitment that he will argue in Cabinet to ensure that that river crossing does not impede the development of the Ted Russell Docks.

There are proposals for a lifting bridge, a high level bridge or a tunnel. Will the Minister rule out a lifting or low level bridge and ensure his colleague, the Minister for the Environment and Local Government, also rules it out? We will not agree to a crossing which interferes with the docks in Limerick. I would like a categoric assurance that that will not happen and that there will not be a Cabinet decision to provide a crossing which interferes with the Ted Russell Docks. A high level bridge or a tunnel are the two viable possibilities in that area and perhaps the Minister would address that issue in his response because it is very important. The docks are continuing their operations and whatever new programmes are planned in terms of infrastructure should not interfere with what already exists and works well. On infrastructure, I support my colleagues on the issue of the N69 which has been in need of upgrading for a long time. However, I also ask that the needs of the Ted Russell Docks in Limerick be given the necessary consideration. I hope other Deputies from Limerick East support me in that regard.

Another area where I have had a problem with the Minister's decision-making process is in regard to the announcement about the headquarters of the company. The Minister said it will be located in Foynes. KPMG did not recommend that the location of the headquarters be decided at this stage and suggested the incoming board should decide on its location. I hope this decision and the gazumping of Limerick as a headquarters had nothing to do with the floating nature of the third seat in Limerick West. I hope it was not made for anything other than the best of reasons.

Mr. Byrne:

Of course.

Mr. Collins:

The Deputy has a suspicious mind.

Mr. Finucane:

It was my powers of persuasion.

Ms O'Sullivan:

It seems to be the only fait accompli and the only change from the recommendations of the KPMG report. That is why I wonder about the motivation behind it. While I am not grudging in recognising the good points of the legislation, I regret that this decision has already been announced. It would have been better to fully implement the recommendations of the KPMG report.

The implementation board obviously has a difficult task ahead of it, such as dealing with staffing, ensuring there are no difficulties and that the whole process is implemented smoothly. I welcome the fact that the Minister said there will not be any forced redundancies, but there will be many issues to be thrashed out. I hope that will be done in the interests of the area and of the mid-west as a whole and that they will worked out in a positive fashion.

Regarding equity and the money which can be invested as a result of the legislation, I note the Minister said that KPMG assessed the amount to be in the order of £5 million to £8 million. That figure may have to be revised upwards judging from discussions I have had with people involved. I hope the Minister will keep an open mind on that and that the amount of funding needed will be made available. The two issues which have been referred to and which have been well debated and flagged are the pensions issue for the workers of the Shannon Estuary port and the cashflow problem in Foynes, and these must be addressed. Our ports are of such importance to the country, it is necessary to ensure that whatever funding is required is made available because there is such great potential, especially in the Shannon Estuary. I hope the Minister will be able to provide the necessary funding. Will the Minister indicate when replying when he expects the provisions of the legislation will come into force, assuming it passes through the House this week?

The Shannon Estuary port received the ISO 9002 award in 1997. I think it was the first port in Ireland to receive that award. The standard of expertise in both port companies is very high. Professional staff with the highest of qualifications will be available to the joint authority when it is set up. As I said earlier, the highest standards of safety have already been implemented in the estuary. There is also a high level of technology. However, a certain amount of equipment will be needed and I hope the money will be forthcoming in that regard.

Overall, this is a win-win situation for both of the ports involved and will be welcomed generally by the movers and shakers in the mid-west. The mid-west has been a very successful region in many ways. It has been to the forefront of development in terms of the airport, technology in the Limerick area, the port and in many other areas. In some ways, the mid-west has operated very well as a region, ahead of other regions in Ireland, and we have benefited in that regard. The estuary, as the core physical centre of the region, has great potential to continue that development. Although the next parish to Loop Head is in America, we can develop. We are obviously constrained to some extent by being on the west rather than the east coast in terms of certain traffic. However, there is great potential there that should be developed.

I would like undertakings from the Minister on the financial support that will be needed to develop the estuary and, particularly from the point of view of Limerick, the question of the fourth river crossing of the Shannon. I want a commitment from the Minister that he will ensure at Cabinet that the Ted Russell docks will not be interfered with by that crossing.

I welcome the legislation. We will table amendments on Committee Stage. They were flagged in the Seanad and the Minister is aware of the issues that are of concern to us. As there will be very little time between Committee and Report Stages, I hope the Minister will have an opportunity to examine them. They will cover much the same issues tabled by the Labour Party in the Seanad. Apart from those, I welcome the legislation.

Mr. O'Shea:

Ar an gcéad dul síos, ba mhaith liom mo bhuíochas a ghabháil le mo comhleacaí Parlaiminte ón Lucht Oibre, an Teachta O'Sullivan, as ucht a cuid ama a roinnt liom. Fáiltím leis an mBille seo ach ní bheidh mise ag caint mar gheall ar cursaí Luimní, beidh mé ag caint mar gheall ar cursaí Phort Lairge. Ní bheidh morán le rá agamsa ach ní hionann sin is a rá nach bhfuil na pointí go mbeidh mé á chur os chóir na Dála tábhachtach.

I thank my co-member of the Labour Party, Deputy O'Sullivan, for sharing her time with me. I welcome the Bill, but probably for different reasons from other Deputies who contributed to the debate. I will not allude to the situation in Foynes or Limerick.

Under a technicality, money is waiting to be transferred to the Waterford port company. Until this technicality is removed, this much needed money cannot be transferred. About £2 million is due from central funds to the Waterford port company to meet a European Investment Bank loan. Therefore, I will not delay the House because I want to see this Bill passed as speedily as possible. I ask the Minister to give an under taking when he replies to Second Stage that the money due to the Waterford harbour company will be paid as speedily as possible after the passage of this Bill through the House this week.

Minister of State at the Department of the Marine and Natural Resources (Mr. Byrne):

While this is a relatively short Bill, encompassing 11 sections in total, this belies the importance of the Bill for the ports industry in Ireland. Since the nine major commercial seaports were transformed from harbour authority status under the absolute central control of the State to fully fledged commercial State company status in March 1997, the ports industry has surged forward.

Like Deputy Finucane, I was heavily involved in the port of New Ross. I was chairman of the New Ross harbour commissioners, which is now a port company. I was delighted to be there because it gave me the necessary experience to speak on this subject. I also know Waterford port quite well. I am sure, since there will not be any interference with New Ross, we will readily make way for Waterford to continue its expansion. Waterford and New Ross are examples of what can be done.

The dynamic growth of the economy has been reflected in the increased business and throughputs at the ports servicing the national and regional economies. For example, a recent study conducted by Dublin Chamber of Commerce on Dublin port found that £30 billion worth of goods is handled by that port.

I would like to give a brief overview of the port companies which underlines their pivotal role in underpinning economic growth and ensuring the sustainable mobility of sea transport. Deputy O'Sullivan alluded to the fact that seaports in the Republic handle just over 93% by volume of our import-export trade and are vital to the operation of all sectors of the economy, in terms of goods and passenger movement. The nine port companies account for 92% of this traffic. Ports throughput in 1999 increased by 6.8% over the preceding year, from 40.05 million tonnes to a record level of 43.28 million tonnes. Some 2.97 million passengers passed through the port companies' facilities in 1999. The total is 4.42 million passengers, including Rosslare in my constituency which is operated by Irish Rail. Turnover in 1999 for all nine companies was £71.6 million, compared to £66.1 million for the same period in 1998, an increase of 9.3%. Total fixed assets for the nine companies, as of 31 December 1999, are valued at £273.7 million.

The Government's action programme for the millennium recognises that the necessary infrastructure to handle ever-increasing volumes of tourism and trade has to be underpinned by continuing investment and the maintenance of competitiveness. There is a necessity for continued investment in the port companies' facilities, both on a national and regional basis. This is clear, given that almost 93% of all external trade by volume relies totally on seaports for access. The strategic importance of seaport trade to the vitality of the national and regional economy is paramount. Some £46 million has been provided in the national development plan for investments in seaports. Investment will be focused on new infrastructure where deficiencies are identified, upgrading of existing infrastructure, improvement of capacity utilisation, intermodal connections and restructuring of small, non-port company harbours.

Turning to the KPMG consultancy report on the Shannon estuary ports industry, the consultants recommended that urgent Government approval for necessary legislation be obtained to create a new single port structure in the Shannon estuary. It is good that all the Members who contributed to this debate, and I am sure the other representatives from that area, support the Bill.

I commend the Minister on introducing the Bill, which is timely and necessary. I congratulate both port companies which operate in the Limerick estuary. As a former chairman of the Foynes harbour company, I feel compelled to state that it is an example to all.

The Bill has reached its current stage a short three months after publication of the KPMG report. This is a reflection not only of the need for action on the report's findings but, more importantly, of the Government's commitment to ensuring that all nine port companies are positioned to deliver the best possible service to their customers.

The Government regards the commercial port companies as a key link in the transport chain. The amendments to the Harbours Act. 1996, contained in the Bill will introduce a degree of flexibility in the powers of the Minister to potentially address strategic issues for the effective management of the ports and their development needs. As an island nation, Ireland is almost totally reliant on seaborne trade to cater for imports and exports. The importance of the ports is reflected by the provisions in the Bill and also by the priority it is being accorded by all Members on all sides of the House.

I am delighted that Deputy O'Sullivan's wish has been granted and that the Minister of State at the Department of Education and Science, Deputy O'Dea, has appeared in the House. I am sure he will make a significant contribution to the debate and that his support for the Bill will be as trenchant and forceful as that of Deputy O'Sullivan.

A very significant provision in the Bill is contained in section 6 which amends an existing provision in the Harbours Act, 1996. Essentially, the restrictive provision in the 1996 Act which circumscribes the powers of the Minister for Finance to make available to a company moneys solely for the purposes of capital works is addressed. The Minister for Finance will now have enabling powers to make available moneys for other purposes as well. In addition, the threshold on the aggregate amount of moneys that can be made available to the ports has been increased by 20% to £60 million. I am sure that will be a source of satisfaction to the Member from Waterford, Deputy O'Shea. These relaxations of financial strictures governing the port companies will be heartily welcomed by those companies.

I commend this innovative and timely Bill to the House.

Mr. Collins:

It was interesting to hear the Minister, Deputy Fahey, state that, on the three occasions on which legislation similar to this came before the House, the Government of the day fell. I sincerely hope that does not happen tonight.

Mr. O'Shea:

God is good, Deputy Collins.

Mr. Collins:

Despite all the innuendo and huff and puff which has been abroad in recent days, I am aware from speaking to members of other political parties that no one would welcome the advent of a general election at this stage.

Ms O'Sullivan:

We will enact the Bill before the Government falls.

Mr. Collins:

Whatever the Deputy says.

Mr. Byrne:

She will have two years to witness its effect before a general election is called.

Mr. Collins:

I have never been a member of the Foynes Harbour Board but I was a member of Limerick Harbour Board for many years and I have a great deal of experience in this area. I assure Deputy O'Sullivan that the Bill will prove very successful.

I commend the Minister for the Marine and Natural Resources, Deputy Fahey, on bringing forward this important legislation. In essence, the Harbours (Amendment) Bill will enable the Minister to amalgamate the functions of the Foynes Port Company and the Shannon Estuary Port Company. The Minister correctly stated that the amalgamation of these two companies will ensure that the new single port authority will become the leading authority on the west coast.

The Bill has received widespread support from interested parties from my constituency of Limerick West. It is important that the ports to which I refer become more competitive in the short and medium term. The amalgamation of the Foynes Port Company and the Shannon Estuary Port Company will ensure that more commercial sea transport operators will use these ports in the future. There will, of course, be key spin-offs for the area as the result of the enactment of the Bill.

Following wide-ranging consultations with both port companies, the Government requested an independent and objective review of the system which operates within the Shannon estuary ports. The report, which was carried out by KPMG Consultants, was published at the end of March this year. It is only right at this point to congratulate the former Minister for the Marine and Natu ral Resources, Deputy Woods, who initiated the process from which the legislation emerged. The consultants stated that the establishment of a new and single port company was the only arrangement which makes commercial and operational sense. The Government has taken this key recommendation on board and included it in provisions of the Bill.

I referred earlier to the spin-offs which could result for the Shannon estuary and the two ports involved in terms of further job creation in the future. However, the establishment of a new amalgamated port will ensure that more coherent marketing strategies can be put in place to enhance the attractiveness of the Shannon estuary to new users. It is anticipated that port charges will be reduced and that a new single port company would be in a much stronger position to promote potential business opportunities for the estuary and for the mid-west region.

Section 1 of the Bill amends section 43 of the Harbours Act, 1996. This section provides that if the Minister for the Marine and Natural Resources is of the opinion that the functions of a company or companies could be performed in a more cost effective and efficient manner by another company or companies, he or she may establish a new company which would result in the amalgamation of existing companies.

Section 1 enables the Minister to amalgamate the functions of Foynes Port Company and the Shannon Estuary Port Company. It also provides for the establishment of an implementation board and an advisory board to facilitate the amalgamation. The Government has already announced the establishment of a five member implementation board on an informal basis initially, pending the enactment of this important legislation.

I listened attentively to the contribution of Deputy Deenihan who stated that a representative from the Kerry region should have been appointed to the board. I have no objection to that proposal. However, it will be difficult to accommodate the Deputy because I understand that the existing boards will continue to operate in an advisory capacity. I also understand that two members from each board were chosen to serve on the implementation board and that it would be chaired by an independent chairman who is from Galway. At this stage, it does not appear that there will be a representative from Kerry on the board.

There will be close liaison between the implementation board, both port company boards and their successor advisory boards in order to ensure a successful transition to a new single port company structure. The advisory board, which will be comprised of the directors of the Foynes Port Company and the Shannon Estuary Port Company, will have a real and important role to fulfil in assisting the implementation board of the new company to pursue new strategies aimed at guaranteeing its future success.

As the Minister for the Marine and Natural Resources stated on 14 June last, a serious obligation will be placed on the advisory boards to assist, in every way, with the achievement of the main and subsidiary objectives for which the company is being established.

Debate adjourned.