Dáil Éireann debate -
Wednesday, 29 Jan 2003

Vol. 560 No. 1

Adjournment Debate. - Company Closures.

Mr. Connaughton

I am grateful for the opportunity to raise the matter of the disastrous closure of the Square D factory in Ballinasloe two weeks ago. I bring to the floor of the House the enormous anxiety and fear shared by the almost 400 people who have lost their jobs and face the dole queue in a couple of months' time. I must tell the Minister that there is great anger in Ballinasloe where people in the town and its hinterland genuinely believe that the Government has let them down. No amount of camouflaging can disguise that. The Celtic tiger boom was a time of unprecedented job creation, but not alone did Ballinasloe not attract industrial jobs, over the past five years it lost almost 1,000 jobs, beginning with substantial redundancies in the local psychiatric hospital. Just over two years ago a further 350 jobs were lost at the AT Cross factory and this latest news sees almost a further 400 watch their employment disappear before their eyes.

I question the sincerity of the Government and the Tánaiste's intention to bring an industrial project to the town. The Tánaiste is a native of the area and this matter has been put to her on numerous occasions over the past five to six years without result. I also question the sincerity of IDA Ireland. Since the closure of the Digital factory in Galway seven or eight years ago, there has been a massive explosion in the number of new industrial jobs created in the city, but not one has come to Ballinasloe. It is very difficult to understand why some industrialists could not be convinced to locate in a town which has an excellent workforce, swimming and leisure facilities, an excellent golf club, excellent shopping facilities, a new marina and inexpensive housing relative to Galway and Dublin. The town has a mainline railway station and excellent primary and postprimary schools.

Whatever the reason, the Government seems to want to turn its back on Ballinasloe, but it was there last week that I saw the biggest public meeting I have ever seen in any town in the constituency in all my years in politics. Thousands of people came out in a spontaneous response to what they see as the death of their town. The crowd included the workers, their families, community leaders and politicians. Everybody who has anything to do with the well-being of Ballinasloe was in the town square the other night.

The people of Ballinasloe feel very angry on another level and I ask the Minister of State to relay that to the Government. While the Government says it has no control over industrialists, although I do not believe that in so far as IDA Ireland is concerned, it is within its power to decentralise. When the Government announced its national spatial strategy before Christmas, Ballinasloe was omitted for some unknown reason. On one side, Athlone was looked after and Galway was taken care of on the other, but Ballinasloe was ignored. There is a new unity of purpose in Ballinasloe and the various bodies and authorities are welded together with a common aim under the county manager, Donal O'Donoghue. Everything that can be done locally will be done, but Ballinasloe must receive outside help from the Government to ensure that it gets an anchor industry to replace what has been lost and to give some hope to the people who have lost their jobs in Square D and AT Cross.

The Government will have an opportunity when the decentralisation of Departments is announced to make sure that, for once, Ballinasloe is not overlooked. It will not be able to hide on this because it is within its remit. We do not want something small, it must be a substantial section of a Department.

Mr. Callanan

The announcement of the closure of Square D came as a huge shock to Ballinasloe and east Galway. I sympathise with all 385 workers of Square D who constituted a great workforce. Square D was a great factory. I also sympathise with the management of the company who are also unemployed. They provided excellent jobs at the factory for 31 years – my wife was employed there for ten years.

I express my thanks to the Tánaiste for meeting a deputation from Ballinasloe last week, every member of which was encouraged by her promise to get each Department, IDA Ireland, Enterprise Ireland, the County Enterprise Board and FÁS to help to provide employment for the town. The loss of 385 jobs comes after the closure of AT Cross one and a half years ago, a company which employed more than 300 workers. These losses have the same effect on Ballinasloe as the loss of Digital had on Galway some years ago.

The town needs help, but we do not intend to lie down and die. Ballinasloe has much to offer. It is situated on the N6, 40 miles nearer to Dublin than Galway. It has great hotels, a marina, new educational facilities and a new swimming pool and leisure centre which has almost been completed. Houses are good value, there are no traffic problems, there are 80,000 square feet of factory space at Square D and a workforce which is prepared to adjust and train to suit other employment. The AT Cross factory is also lying idle and there is a new IDA Ireland business park. Ballinasloe is ideally situated for decentralisation and I appeal to the Minister for Finance to transfer a worthwhile Department to the town. The people of Ballinasloe will welcome civil servants.

I call on the Tánaiste to redouble her efforts to bring new industry to the town and to help other employers there to expand. A number of small industries in the town are hoping to grow with her help and the enterprise centre in the town is doing great work. Ballinasloe should get extra incentives to attract new industry. There is no point putting more industry into cities which are choked with traffic when Ballinasloe has so much to offer. As a local Deputy, I call on everybody to work together to promote and market the town to attract new industry and decentralisation. I compliment Galway's county manager, Donal O'Donoghue, and Ballinasloe town council who have brought together all the agencies in the area to promote the town. Together, we will ensure Ballinasloe returns to prosperity.

Minister of State at the Department of Health and Children (Mr. T. O'Malley)

I thank the Deputies for raising this matter on the Adjournment. The announcement by Square D on 15 January 2003 to close its Ballinasloe plant by the end of June 2003 with the loss of all 387 jobs on its books cannot be described as anything other than a body blow for the workforce, their families and the local community. It is very much a priority for the Tánaiste and Minister for Enterprise, Trade and Employment to ensure that everything possible will be done to find new investment and new sources of employment for Ballinasloe, although I know this will not be an easy task.

Established in 1971, the Ballinasloe facility manufactures the Square D brand of electrical circuit breakers, sold primarily within North American markets. The closure decision, according to the company, reflects significant change in market demand for circuit breakers, resulting in over-capacity in manufacturing operations at the group's North American division. A number of the group's North American manufacturing operations have already been moved to Mexico.

In an effort to lessen the impact of the closure, the North American division of the parent company, Schneider Electric, has stated that it is committed to working with IDA Ireland and the Irish authorities to find manufacturing firms that are interested in the Ballinasloe plant and may be in a position to offer suitable job opportunities to a well-qualified workforce; assist Ballinasloe employees obtain new jobs; provide out-placement assistance and job search training; provide counsel and information to employees on company-paid benefits; and provide five weeks severance pay per year of service, in addition to statutory redundancy entitlement. The agencies under the remit of the Minister and her Department are also working to lessen the impact of the closure. IDA Ireland has been aware of the difficult market conditions being experienced by the company for some time and began to intensify discussions late in 2002, when it became apparent that the company was in difficulty. The IDA has already brought one potential client to view the plant and will continue to explore other possibilities as well as seeking out other potential clients.

FÁS, the national training authority, has already been in contact with the company and is to meet the company management with a view to offering its services to all staff. FÁS will register people as job seekers, provide career information and guidance and carry out a training needs analysis. It will provide a range of training courses which will be designed to meet the skills needs of individuals to enhance their employability, while also providing the area with a skilled workforce. Enterprise Ireland began discussions with the company last week to discuss supports for any possible start-ups by local senior management.

The industrial development agencies were working hard in Ballinasloe, prior to the closure announcement. The IDA was already active in the promotion of Ballinasloe for new inward investment, with the key focus being on providing international standard property solutions in the town to attract new companies. In light of the closure of Square D, the IDA has now finalised plans and a planning application has been lodged with Galway County Council for a new 27,000 sq. ft. technology unit on the IDA's 30 acre business park in Ballinasloe. When planning permission is granted, construction will be undertaken by private developers and the IDA has already begun to actively market this facility together with promoting the Square D facility in the town.

Enterprise Ireland has approved funding of €120,000 for the work in progress at the community-owned enterprise centre and it is understood that there is still some space available for potential projects. The Galway County and City Enterprise Board has been actively involved in industrial and community development in Ballinasloe. During 2002, considerable progress was made with the area community development group with €63,000 allocated to the small business development park, which now houses four start-up businesses. Over the last three years Ballinasloe has received €350,000 in support from the county enterprise board.

At Galway-Mayo Institute of Technology and Galway university, there are enterprise platform programmes with places available for staff of Square D who might have an idea to start up their own manufacturing or internationally traded services businesses. This programme affords the opportunity to develop business plans and to carry out market research for ideas before actually starting a business. A similar programme is about to commence in the Athlone Institute of Technology.

In regard to development in the Galway area, it is significant that five new IDA investment supported proposals, announced in 2002, will ultimately provide almost 2,200 new high quality jobs in the health care and internationally traded services sector. The companies concerned are Abbott, Churchill, Medtronic, Micros and Net IQ. Recognising that urban environments are generally more attractive for mobile investments, the IDA has adopted a target of having 50% of all new greenfield investment located in the Objective One region. It has sought to encourage investments in defined sectors to specific regions, which seeks to build on the relative advantages in different towns. An essential part of this endeavour has been the refining of IDA property offerings. This is a key tool in winning investments.

The IDA has, and is continuing to design and develop, high quality business parks, fully serviced up to international standards. In Tuam, the IDA has acquired 27 acres and is currently carrying out site development works after which it intends to have a high quality facility provided by the private sector. At Loughrea it is upgrading land to make it more marketable. In Gort it has a 20,000 sq. ft. high quality building which it is actively promoting for suitable projects.

While the IDA is convinced that it has excellent quality property solutions in the larger towns in the county, it is also cognisant of the slower inward investment climate that has prevailed for the past two years. This also has had an impact on jobs in existing client companies. Much pro gress has been recorded over the past several years in many of the companies that have been attracted here, in the shift up the value chain in many of the companies and in many aspects of our competitiveness.

Costs are a big issue for all companies. They have moved out of line with our competitors, and this impacts heavily on lower technology businesses. Hence, the IDA has a major emphasis on the health care and internationally traded services sectors. There is now a well developed health care cluster in the west region, especially in Galway, which includes companies like Transition Optical in Tuam, StarGuide in Oranmore, Medtronic, Boston Scientific and Abbott in Galway city.

Working with the third level institutes in the area, Enterprise Ireland has approved €2.6 million for the development of campus incubator units at Galway/Mayo Institute of Technology in Galway and €695,000 for units in the National University of Ireland, Galway. Some €2.54 million has also been approved for the development of units at Athlone Institute of Technology. These incubation centres support the development and expansion of campus company activity, encourage and support the commercialisation of research and development carried out in the institutes of technology and embed the institutes of technology as major supports for the development of high-tech companies in the regions.

All of the State agencies under the auspices of the Minister's Department will continue to work closely in the interests of developing Ballinasloe. The Minister has met with many of the Ballinasloe interest groups and hopes to do so again in the near future, to reassure them of her ongoing commitment and that she will continue to work on their behalf.

An Leas-Cheann Comhairle

The remaining two matters on the Adjournment will be taken together. Deputies Ó Caoláin and Neville have five minutes each. I first call Deputy Ó Caoláin.