Adjournment Debate. - Job Losses.

I thank you, Sir, for allowing me to raise this important matter on the Adjournment. The Finn Valley area of County Donegal received another blow yesterday evening when Nena Models Limited announced the loss of 75 manufacturing jobs in its Castlefinn factory. This industry has been located in County Donegal for over 30 years and provided employment for 600 at its peak production. After yesterday's announcement its employment in the Finn Valley will be reduced to 50, mainly engaged in administration and distribution located in the company's Stranorlar plant.

This is a most serious blow, not alone to that part of County Donegal which has suffered so many job losses in recent years, but especially to the 75 employees who have been made redundant. Many of these men and women have given long years of faithful service to the company. Many have financial responsibilities, such as mortgage repayments, educational expenses and other commitments. At a meeting last Monday attended by me and my colleagues in the House and other public representatives, we heard stories that people would have to sell their houses in the wake of the closure. They now face a bleak and uncertain future with few prospects of immediate alternative employment in their area.

The only measure that can be adopted at this stage to cushion the loss of jobs is the provision of a generous redundancy arrangement. I understand the company is in a sound financial position and I also understand that statutory redundancy payments are to be increased in the near future. The Taoiseach indicated this to me in the House this morning.

The Nena Models workers who are being made redundant should, and must, benefit from these factors. I appeal to the Tánaiste and Minister for Enterprise, Trade and Employment to ensure that the offices of FÁS are used to initiative a training programme for those who have unfortunately lost their jobs and their livelihood.

The Finn Valley is an economic and unemployment blackspot. In the past years over 1,000 industrial jobs have been lost, including 600 at Nena Models and 400 at Herdmans. This does not include the fall in agriculture employment. Not only does the absence of job opportunities cause major economic difficulties and hardship, it is also the cause of many social and personal difficulties, especially among young people, those under 25 years of age. In recent times the people of the Finn Valley have experienced such difficulties.

The Government must bear a major responsibility for the loss of these and other jobs in County Donegal. The high cost of production fuelled by one of the highest inflation rates in the European Union and high insurance charges and energy costs are forcing these long-established industries to relocate in other parts of Europe, such as Poland, Hungary, Bulgaria and Russia. Nena Models has already commenced production in some of these countries. The Government's pursuit of such policies will result in further job losses.

The Minister has responsibility for IDA Ireland and Forbairt, the job creating agencies in the Finn Valley area. I call on her and the agencies to ensure that they visit the Finn Valley as soon as possible to see for themselves the hopelessness of the job situation. The Minister visited the area a number of years ago and met people from the chamber of commerce, community councils and so on. Since then the situation has deteriorated to crisis proportions. I am asking for a commitment that every effort will be made to attract a major industry to this area of County Donegal and to prevent it from becoming an economic and unemployment wasteland.

I thank the Deputy for raising this matter on the Adjournment. The company in question is a significant employer in the manufacture of ladies clothes in County Donegal. I understand layoff notices have been issued to the staff. This will begin to take effect when two weeks of orders, currently on hand, have been completed. The company has advised the Tánaiste and Ministers for Enterprise, Trade and Employment that the collective redundancies will be implemented on 14 March.

This situation has arisen because of the loss of orders from existing customers, primarily for competitiveness reasons. It is unlikely that they will place new orders with the company before the notice which has been given to the workers expires. The competitiveness agenda is to the forefront, especially in the textile industry. The company has indicated that the redundancies have arisen due to labour costs, price competition in the sector and demand for lower cost products that are no longer competitive to produce in Ireland.

The Nena Models group is not confined to Castlefinn. Overall, Enterprise Ireland, the industrial development agency, which works closely with the company, considers the group to be still strong because of its branded business. I understand the group will continue to trade with its range of branded clothes, most of which will be outsourced, but this is no consolation to the workers who have lost their jobs.

As far as I am aware, there is no trade union involvement in the company. However, it has indicated it will consult employees with regard to the redundancies. The full services of FÁS will be made available to those workers who wish to avail of their services. One-to-one interviews can be arranged to help people in a number of ways. Indeed, FÁS employment services in Ballybofey will be in contact with the company this week to arrange registration interviews. Following these, a skills analysis audit will be undertaken and appropriate retraining or job placement options will be offered to all the workers.

The industrial development agencies are doing all they can to promote new investment in County Donegal and the north-west region generally. There were a number of overseas job announcements and investments over the past few years in Donegal town, Letterkenny and Buncrana among others.

The industrial development agencies, particularly IDA Ireland, Enterprise Ireland and Údarás na Gaeltachta, are continuing to promote the area. However, the final decision on where to locate a particular project ultimately rests with the promoter.

A number of other initiatives are also being pursued in the region. Links between third level education and industry are ongoing. Cross-Border links have been developed. Furthermore, Letterkenny has been named as one of the new linked gateways in the recently launched national spatial strategy. A linked gateway is one in which two or more strong towns work in partnership to promote economic and social development in their region. The development of Letterkenny-Derry as a linked gateway will strengthen the north-west as Derry has been identified in the regional development strategy for Northern Ireland as a regional city for the north-west. A large effort has also gone into attracting expanding companies from Dublin and the east coast region to relocate to Donegal. This is very much part of the regional strategy for the area.

Enterprise Ireland is also working with community groups in the area to increase the level of enterprise space available for new businesses. Significant funding has been provided to Convoy Enterprise Centre. Enterprise Ireland has a comprehensive range of business development supports for clients in the Finn Valley area and these are available to support further development. I am satisfied that a focused agency approach together with a locally-based approach is what is needed to address the jobs problem in the area.