Dáil Éireann debate -
Tuesday, 19 Nov 2013

Vol. 821 No. 2

Topical Issue Debate

HSE Staff Remuneration

Deputy Sean Fleming

I thank the Ceann Comhairle for giving me the opportunity to raise the issue of salary top-ups to senior staff in various areas of the health service. I am very pleased the Minister for Health, Deputy James Reilly, is present to respond. He will know that the public was shocked by the coverage in recent days of the secret top-up payments to staff in very well paid jobs in some major hospitals. Recent newspaper reports, probably based on the internal audit report produced for the HSE on this exact topic, which was finalised on 15 March 2013, list hospitals such as Holles Street, the Rotunda, the Coombe, Crumlin and the Mater in respect of top-ups for individual members of staff in addition to their basic salaries, which are already paid for and financed by the taxpayer. There was a top-up in the order of €45,000 in one case, €20,000 in another, €53,000 in another, €30,000 in another and €26,000 in yet another. I will not mention any individuals as I am not in the business of carrying out a witch-hunt of individuals. The issues have been well publicised and the people are shocked that staff on salaries in the order of €200,000 are receiving these types of top-ups. All the hospitals in question are substantially funded by the taxpayer. Some extra funds from fund-raising and other sources are received by them. Income from initiatives such as car parks and shops may have been used to pay some of the allowances. It is disconcerting to know that some people who have been involved in fund-raising activities on behalf of the hospitals have been paid an allowance to engage in some of the activities.

The Minister has known about this issue for a long time, yet he concealed it. I am looking at the report he would have seen last March. It is clear from page 16 that, in March 2012, The Irish Times reported that three senior executives in a HSE-funded organisation were being paid for private work on top of their public commitments.

In May 2012 HIQA published a report on Tallaght hospital which found a lack of clarity around decisions to pay substantial additional remuneration to individual postholders for taking on additional roles, to the tune of more than €150,000 in one instance. In June 2012, almost a year and a half ago, the Sunday Business Post reported on the remuneration packages of the CEOs of four of the section 38 funded organisations. A memo from the Department of Health in June last year stated it knew that some of the salaries of the CEOs were being topped up from other funds. This was all well known to the Minister and his Department. When did he decide to take action? I am very concerned that during the negotiations on public service pay he presided over the talks on the health services area and set out to reduce weekend pay rates for nurses, emergency medical technicians and others. When the Haddington Road agreement was being negotiated before the summer recess, he insisted on cuts being made to increments for some front-line staff. He is part of a Government that forced the Financial Emergency Measures in the Public Interest Act through this House in July, yet many of the 44 agencies had not replied at the time and were not in compliance with the basic rules. He was aware of this while he was asking nurses to take pay cuts and various other health service workers to forgo their increments. He knew this was going on and in the light of the sacrifices people were being asked to make, it was most unfair that he sat on this information, did not bring it to light and did not have the issue dealt with as part of the Haddington Road agreement earlier this year.

Minister for Health (Deputy James Reilly)

I will deal with some of the specific issues raised by the Deputy. First, this is a Government which is actively pursuing reform of the health service. The issues emerging are as a result of a HSE audit of section 38 bodies, both hospitals and disability agencies. This is a Government which is trying to weed out additional sweeteners and expenditures within the health service at a time when any funding, whether Exchequer or private, should be going into the provision of services for patients, not towards unsanctioned payments to senior managers. Front-line staff in health services are working within the Government's pay policy and also playing their part in the reform of health services through new working practices, rosters, etc. The same rules must be applied to senior managers as to those on the front line. I take the opportunity to commend the great work done by those on the front line to keep health services safe. I also commend them for the improvements made in terms of the numbers who have to endure long waits on trolleys. There has been a 34% improvement in that regard since we came into office.

What we need is a clear picture of all payments made. On foot of the circular issued in September by the Department of Health clearly restating public pay policy, the HSE wrote to all of the agencies in question. On 30 September copies of the HSE's audit report and Government pay policy were sent to all section 38 agencies with a request that they respond by 28 October, ensuring compliance. In total, 33 agencies responded, some with a holding position and others requesting to seek legal advice. On 5 November the HSE again wrote to them, reiterating the requirement that they respond and ensure compliance, with a deadline of today, 19 November.

Every organisation that receives public funds must be accountable and transparent. The Department of Health will receive a comprehensive report within the next few days from the HSE on compliance with public pay scales which I will publish on my Department's website.

As the House will be aware, top-up payments of this nature first came to light in May last year when HIQA published a report on governance at Tallaght hospital. It emerged that an employee of the hospital had been receiving an additional €150,000 in payments since 2005. In total, five senior management staff had received €739,000 in top-up payments between 2005 and 2010, when Deputy Sean Fleming's party reigned supreme. Last May I requested that the HSE conduct an internal audit of all section 38 funding recipients, both hospitals and disability agencies, to ensure similar unsanctioned payments were not being made in other locations. The HSE's audit report concluded that there were 36 different types of allowance being paid to 191 senior managers at an annual cost of €3.224 million. In fairness, some of these allowances such as those to clinical directors are in compliance with salary scales as negotiated under the 2008 consultant agreements. However, in some private cases private funding is used to top up approved rates of pay. A total of 13 agencies pay additional remuneration or benefits such as company cars, car expenses or pension contributions to a total of 34 managers to a value of €912,472. In response to the audit, my Department has issued correspondence which clearly states "salary scales must be strictly adhered to and in no circumstances should an employee receive remuneration in the nature of pay and allowances of an amount greater than the amount prescribed".

Deputy Sean Fleming

I thank the Minister for the summary information on where we stand today in terms of the background to the report, the internal audit report and the circulars, reminder circulars and deadlines issued by his Department. That is all fine, but the question now is: what action will the Minister take on foot of the information now in the public arena? This is the last day for section 38 organisations to submit the information requested. If it is helpful, this House will support the Minister if he chooses to call in the chairperson of each of the boards of the organisations which are not in full compliance or which have not confirmed that they are in complaince. Officials in the Minister's office should telephone the chairpersons tomorrow morning to arrange to meet them straightaway in order that he can lay it on the line to them that they must implement Government pay policy. These organisations receive substantial funding from the Exchequer.

The people also want to know when these payments will stop. That is the issue. We know the payments were made and that matter has been examined, but when will they stop? That is what the people want to know, particularly in the context of the various cuts made to health services, with children waiting for cochlear implants, tracheotomies and so forth. I spoke to two mothers last week whose children had been in Crumlin Hospital for over 12 months because budgeting issues within the HSE meant home care packages had not been put in place for them. While this is happening, certain individuals are able to receive these extra payments. The Minister is also aware that many persons undertake voluntary fund-raising for these organisations and that people are happy to give generously when they know that all of the money is being spent on patient care. They will be disturbed to see that some money from private sources is going to already well paid executives. It is important, in the interests of public trust in voluntary fund raising, that the Minister give a commitment that as of the close of business today, payment of all of these allowances will stop. He would be doing a good service for the House and the institutions in question if he were to give us that assurance.

Deputy James Reilly

We expect all of the disclosures to be made by the close of business today, 6 p.m. The HSE will then take some time to examine them, with any extenuating circumstance and any contractual or legal issue that arises. The Government is committed to public pay policy being adhered to in section 38 agencies and hospitals. The rationale is quite simple. Staff of these bodies enjoy all of the privileges, including permanency and other arrangements, enjoyed by public servants generally. Therefore, they must be held accountable and submit to the arrangements that apply to public servants in general.

It is interesting to note the spirit in which Deputy Sean Fleming has raised this issue and his questions about the action we are going to take. It was during the terms of office of successive Fianna Fáil-led Governments that these arrangements first started and were allowed to continue. It is only now, when the Government has identified them and is taking action, that the Deputy and his colleagues have become concerned.

Deputy Derek Keating

The Deputy has some neck.

Deputy James Reilly

We will taken action, unlike the previous Government, and bring transparency and fairness to the system, as we promised to do.

The HSE will issue a report to me in the coming days and advise me on the best way forward, given the circumstances that may pertain in different areas. That is something to which the Government and I are committed and which we have every intention of pursuing. The people can be assured that this issue will be addressed comprehensively.

Primary Care Centre Provision

Deputy Pat Breen

I welcome the opportunity to raise this matter and thank the Minister for Health for being present to answer my query. I acknowledge the progress he is making in reforming the health system, particularly when economic resources are scarce. Tweaking the existing health model as the previous Government did would never have delivered the fundamental change this programme of reform will deliver. I commend the Minister for his courage in reforming and restructuring the health system, building the children's hospital, changing the way consultants work, reducing drug costs, improving waiting list and trolley waiting times, providing free general practitioner care for the under fives and, in time, introducing universal health care which will lead to an improved patient experience for all those who interact with the various medical services every day. That is important. If the health care system is to be transformed, we must eliminate the two-tier health system and provide a better service that will be more easily accessible. Primary care centres fulfil that role. They provide a broad range of services under one roof - a one-stop-shop for the provision of local medical services. These centres are the first point of contact for the patient and in the long run will provide considerable cost savings for the health system, given that they increase the lifespan of patients attending because they tackle small problems before they become big ones.

The Minister will be very much aware of the benefits of such centres having visited a facility in Ennis earlier this year. I am glad to report that planning permission has been granted for another centre in the vicinity of the town. However, these centres are being developed thanks to the efforts of GPs and private investment. The advantage of a HSE centre is that it provides equality of access for people across the board. We were all under the impression that Ennis would be included in the first round bundle of primary care centres to be developed and I was disappointed to hear yesterday that the HSE had not included it in its list of 16 projects to progress. Given the changes that have occurred in the hospital structure in County Clare in recent years, the development of a primary care centre in Ennis would alleviate pressure on resources at the Mid-Western Regional Hospital in Limerick. The HSE had indicated Ennis would be on the list of 16 projects to proceed.

I raise this issue on behalf of the people of County Clare. Are there obstacles to developing the centre at this stage? Is the HSE engaged in ongoing discussions with GPs to pursue the project as an operational lease arrangement rather than a public private partnership, PPP? Is this the reason for the delay? Will it be impossible to include a primary care centre in 2014? Has the development of private centres played a role in the decision? My office received a number of calls earlier from people expressing concern following a debate on Clare FM this morning. The Minister is committed to the health service and the delivery of health services for the people of County Clare. I would appreciate it if he could give an explanation to the House and provide the background, which might help to clear up the uncertainty that has arisen as a result of this announcement.

Deputy James Reilly

I am grateful to the Deputy for raising this issue. I am glad to tell the House that significant progress has been made in the development of primary care centres. A total of 34 centres have been built since the Government took office. On average, one primary care centre opens every month. Some 35 primary care centre sites were originally identified to be built by PPP, 16 of which have been identified as suitable. Many of the remaining primary care centres, including the one in Ennis, should progress and could be built by operational lease or inclusion in the capital plan.

The programme for Government sets out the Government's commitment to ensuring a better and more efficient health system and a single tier health service that will deliver equal access to health care based on need, not income, which the Deputy mentioned. In a developed primary care system, up to 95% of people's day-to-day health and social care needs can be met in the primary care setting. The key objective of the primary care strategy is to develop services in the community which will give people direct access to integrated multidisciplinary teams of GPs, nurses, physiotherapists, occupational therapists and other health care disciplines. This is central to the Government's objective to deliver a high quality, integrated and cost effective health system. Modern, well equipped primary care infrastructure is central to the effective functioning of primary care teams. These teams enable multidisciplinary services to be delivered on a single site, provide a single point of access for users and encourage closer co-ordination between health providers. The infrastructure development, through a combination of public and private investment, will facilitate the delivery of multidisciplinary primary health care and represents a tangible refocusing of the health service to deliver care in the most appropriate and lowest cost setting.

The intention to date has been that, where appropriate, infrastructure is provided by the private sector through negotiated lease agreements. Where service needs dictate, accommodation will be provided in primary care centres for mental health service delivery. I had the pleasure of opening a centre with Deputies Catherine Byrne and Michael Conaghan in Inchicore last Friday. Not alone is a mental health facility provided for the community there, a 50-bed long-term care facility for older people is also being provided. New arrangements are being put in place to have specialists in older people's medicine visit both the long-term unit and the primary care centre. This is part of our underlying plan and adheres to our principle of not only treating the patient at the lowest level of complexity that is safe, timely and efficient but also as near to home as possible. We must stop this idea of 50 people having to travel miles to see one person when a single specialist could travel to the centre and see the people there. That is what is happening in Mitchelstown, County Cork. Complete antenatal care is delivered in the primary care centre and patients do not have to travel to hospital in Cork to be seen unless they develop a major complication.

In 2012 the HSE embarked on a prioritisation exercise for primary care centres. However, the exercise is dynamic in nature and constantly evolving to take account of changing circumstances, including the feasibility of implementation. It is the Government's intention to develop as many primary care centres as possible using one of the following methods: direct build by the HSE funded entirely by the taxpayer, or leasing arrangements with the private sector or PPPs. Considerable progress has been made in the delivery of primary care centres and 34 centres have opened since May 2011.

Ennis was one of the 35 potential locations for primary care centres to be developed by means of a PPP, but that has changed, as GPs were not in favour of that process. Ennis remains on the HSE's schedule of primary care centres to be developed. An operational lease is being considered as the best option and it is the preferred choice of local GPs. The HSE continues to engage with potential developers who have expressed an interest with a view to making progress on this development as soon as possible. However, we will not build primary care centres that will lie idle, while GPs sit outside asking how much they will be paid to go in. That would not represent value for the taxpayer and it will not be allowed to happen.

Deputy Pat Breen

I thank the Minister for his reply and clearing up the uncertainty. I am delighted that he is committed to continuing the good work done, with 34 centres opened. Will he elaborate on the operational lease option? What is the timeframe involved? He said the HSE was continuing to engage with potential developers. I hope something will happen in 2014. The Minister's commitment to the Ennis project should be commended. I will keep the pressure on him and the HSE to ensure the project goes ahead, given the changes to health services in County Clare in recent years.

I raised the issue this evening so as to clear up that uncertainty. The Minister has provided some clarity and I hope the issue will be resolved in 2014.

Deputy James Reilly

We will continue to press for the development of a centre in Ennis, as well as at other locations. The critical point is to have the agreement of the general practitioners in the area to come to these centres. We are offering modern purpose-built premises where they can also interact with many other members of the primary care team. From my professional experience, if one has access to a physiotherapist, one sees the opportunities for one's patients to be treated by that physiotherapist. However, if the physiotherapist is based many miles away, very often other modalities of treatment are brought into play or the patient has to be referred to a hospital to access physiotherapy services.

The same applies to mental health services. Many patients cannot afford to attend counsellors privately. If there were a public health counsellor in the primary care centre, a patient could use that service. What we would like to see in the future is a GP being able to refer patients directly to a counsellor without having to involve the psychiatric service because that is an inappropriate use of the psychiatric team's time. The GP is well positioned to determine whether medication would be best delayed and counselling sought first. It has been well proved, both here and in other jurisdictions, that the latter modality of treatment has very good outcomes.

The potential for primary care centres and their use by GPs is enormous. Earlier I referred to Mitchelstown, County Cork. There is another large primary care centre in Mallow covering three separate practices. They refer to the fourth practice which allows them to deliver a range of services that no one practice could deliver on its own. With the volume of doctors and sub-specialisation among GPs, the centre is able to offer a much wider range of services to patients, obviating the necessity for patients to have to undertake long journeys into Cork city to avail of specialist care in hospitals there.

Fuel Laundering

Deputy Derek Keating

I thank the Ceann Comhairle for giving me the opportunity to raise this issue and the Minister for Finance for attending the Chamber to respond to it. It involves a serious criminal matter. The Garda in Waterford was tipped off about the theft of a trailer and, as a result, obtained a search warrant which was executed last Friday. It resulted in the seizure of several large tanks and equipment which had the hallmarks of fuel laundering on a large scale. To date, the information available from the Customs service shows this plant for laundering diesel was fully operational up until recently. It was sophisticated, involving bleaching, namely, the removal of green dye from legitimate diesel.

This is a new development as the majority of laundering operations have been found in the Border counties, operated by subversive groups. These operations defraud the State of millions of euro in revenue every year. They also damage cars and industrial equipment because of the substandard product that is circulated. Revenue has shut down over 100 fuel outlets and over 20 fuel laundries with sophisticated equipment.

A major side effect for the State is the clean-up operations after these criminals dump the sludge, in many cases on the side of the road. Louth County Council has received extra funding to address the crisis of sludge being improperly disposed of, causing not only a toxic threat but also a highly expensive recycling process.

For the first time in the most southern part of the country, a serious development of criminality has occurred, a massive shock to the local community in Waterford. Does the Minister believe a specialised Garda-Customs service unit needs to be established, particularly since that if it were not for the finding of a stolen trailer, there was every possibility the Waterford operation would not have been discovered?

Minister for Finance (Deputy Michael Noonan)

The Revenue Commissioners inform me that they are acutely aware of the threat posed by fuel laundering to remove the marker added to rebated fuel for off-road use. Fuel laundering to remove the marker from rebated fuel has been a persistent problem during the years. However, it remained a marginal activity because the sulphur content of marked fuel was higher than that of road fuel. Accordingly, the sulphur content continued to distinguish laundered fuel from genuine road fuel. Environmental standards for the sulphur content of fuel changed from the beginning of 2011 which resulted in marked fuel with the same sulphur content as road fuel coming onto the market. With this change, fuel laundering became more viable and criminal gangs intensified their laundering and distribution activities dramatically from the first half of 2011.

Revenue collects some €1.1 billion annually in excise duty on road diesel. Therefore, the potential for loss of tax revenue from this fraud is significant. This type of criminality also undermines the competitiveness of legitimate businesses, damages the environment, can damage consumers' vehicles and sustains organised criminal gangs which are the prime movers in this illegality.

Recognising the threat this illegal activity poses to the Exchequer and legitimate business, the Revenue Commissioners have made action against illegal fuel-related activities one of their top corporate priorities, adopting a comprehensive strategy to tackle the problem with several elements. The licensing regime for auto fuel traders was strengthened with effect from September 2011 to limit the ability of the fuel criminals to get laundered fuel onto the market. A new licensing regime was introduced for marked fuel traders in October 2012, which is designed to limit the ability of criminals to source marked fuel for laundering. New supply chain controls were introduced from January 2013 that required all licensed fuel traders to make monthly electronic returns to Revenue of their fuel transactions. The first returns were received by Revenue in February. It is using the data to identify suspicious activity and is investigating several traders.

Enforcement action, involving close co-operation with other law enforcement agencies on both sides of the Border, has been intensified with the aim of closing down fuel laundries and dismantling criminal networks involved in the activity. Revenue and HM Revenue and Customs are co-operating closely to ensure both agencies pursue an effective and joined-up approach to tackling the problem. In particular, Revenue and HM Revenue and Customs are working together to identify a more effective marker for use in both jurisdictions. A joint invitation to make submissions process is close to conclusion and a decision on the new marker is expected shortly.

Revenue regularly reminds motorists and the public generally that, in addition to its impact on the Exchequer and legitimate trade, they should be aware of the risks posed to their vehicles by using laundered fuel, as well as the fact that sourcing fuel in this way is funding criminal activity. Retailers who suspect or have evidence that laundered diesel is being sold in their area can help by reporting their suspicions to Revenue either directly or through their representative associations. Such reports are treated as confidential and fully investigated by Revenue.

Revenue's enforcement strategy in the fuel sector continues to yield results. In the past two years 107 filling stations across the State were closed for breaches of licensing conditions. Including the most recent detection in Waterford, over 2.9 million litres of fuel have been seized and 28 oil laundries closed down since 2011, including eight oil laundries to date in 2013.

The illegal laundry detected in Waterford had the capacity to launder approximately 10 million litres of fuel per annum, with a potential loss to the Exchequer of approximately €5 million per annum. A number of large tanks and ancillary equipment were seized and the laundering plant was dismantled. Investigations into the laundry operation are continuing.

I am satisfied that the strategy being implemented by Revenue is proving successful. Legitimate traders have welcomed the new supply chain controls and provided anecdotal evidence of reduced competition from rogue traders and reduced availability of laundered fuel. Consumption of auto diesel has increased by some 5% in the 12 month period to October 2013, in comparison to previous years when consumption was largely unchanged. I strongly support the current strategy being implemented by Revenue and I am confident that it will succeed with the co-operation and support of the legitimate trade. I am informed by the Revenue Commissioners that the industry has worked very closely with them in developing and implementing their strategy. We are grateful to Revenue, the Customs service and the Garda Síochána for their ongoing work in this area.

Deputy Derek Keating

I thank the Minister for his comprehensive report which reflects his awareness and appreciation of the seriousness of this crime and the effect it has in terms of the loss of revenue, as well as on local businesses, the environment and the morale of the local community. The report will help to reassure the local community, particularly in Waterford. That is one of the reasons it is so important we have had this discussion in the Dáil to assure everybody that the Government and the authorities are very serious about this matter. We want to raise awareness of it. As always, as the Minister would agree, we appreciate the co-operation of everybody in the local community in our efforts to deal with this growing crime threat.

Deputy Michael Noonan

The initiatives taken in the last two Finance Bills are working, especially the one on traceability. In one case, thousands of litres of fuel were being delivered to the equivalent of a corner shop where, obviously, there was no outlet to sell it. Traceability is the key. Previously there was no traceability of the identities of the customers of the big fuel farms which supplied central heating oil. Since the initiative on traceability was taken it has been possible to identify, all the way from the port of import or point of refinery to the end user, if huge amounts of fuel are being delivered to locations that cannot legitimately include them in the retail trade. Investigations usually end up with the discovery of a fuel laundry. The legitimate trade takes the view that this initiative is working and that the sale of diesel has increased by 5% in 12 months, partly due to a little growth in the economy but mostly because the illegitimate traders have been taken out.

Jobs Protection

Deputy Robert Dowds

With my colleagues, Deputies Joanna Tuffy, Emmet Stagg and Jack Wall, I am very concerned about the risk to more than 400 jobs at the Lufthansa Technik plant at Rathcoole, County Dublin. These are highly skilled jobs of a type of which we do not have enough in Ireland and it would be a major blow to our area and the country generally if they were lost. It is welcome that the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, has asked IDA Ireland to engage with this case and that there is a 30 day consultation period. I urge IDA Ireland, the management and the trade unions involved to come together to see if it is possible to do something to save all of the jobs, if possible. If it is not, it would be most welcome if an alternative operator could be found. It is very important that these jobs are kept in the country. In an ideal world I would like Lufthansa to continue because from my consultation with the workers, it has proved, up until now, to be a good employer. Everybody can empathise with the workers because they face a very bleak Christmas and an uncertain new year and every effort must be made to save as many jobs as possible. Given that we have a major expanding private airline in Ireland, I wonder if it is possible to put out feelers to see if it has jet engines that could be serviced at this plant.

I support the remarks I know Deputies Emmet Stagg and Jack Wall will make about the PWAI. Those jobs are equally important. Although fewer in number, it is very important that they be kept in Ireland.

Deputy Jack Wall

I thank the Ceann Comhairle for taking these two matters, both of which are relevant to the aerospace industry. Many of the employees of the two companies involved are constituents of mine in Kildare South and there is grave concern about their employment opportunities. This is a specialised field which we should not give away lightly. Talking about IDA Ireland and Enterprise Ireland being involved is one thing, but the necessity for the Minister to adopt a hands-on approach cannot be overstressed. Some of the employees have been with these two companies for 30 years. The PWAI plant has expertise that is available nowhere else. That has been proved because when the company tried to show that the work could be done elsewhere, the plants to which it intended to move the business had to send engines back to Rathcoole to have them serviced. We cannot afford to lose the high level of expertise that has been generated during the years. There has never been an industrial dispute at the company. There has been nothing but co-operation between the workforce and management to achieve a successful progressive company. The line Minister must become involved. There is no point telling me that he is close at hand, as he said in a written answer to Deputy Emmet Stagg's question. This issue is too important for such contact. It must be dealt with hands-on by the Minister. These jobs must be protected because the aerospace industry is going to progress, as we have seen with Ryanair's purchase of new airliners. We should hold onto this industry. It is important that the Minister be involved personally.

Deputy Seán Crowe

I agree with the other speakers. We are talking about viable, high quality jobs in profitable companies. According to its website, Lufthansa Technik had a turnover of €205 million in 2011. Its workers were called to a meeting last Friday when the manager read a report and talked about possible job losses. He said it was not because of the workers and that he was happy with their work. It was not due to the restructuring in which they had been involved. It was due to outside factors. These are very skilled jobs which we cannot afford to lose. The lives of 411 employees and their families are in turmoil. Many of the workers have been at the plant for 20 or 30 years. As there are many couples among them, whole families are affected. It is not just one individual but whole families. The impact is felt by families, the broader community and the local economy. Does the Minister of State accept that there is no clear rationale as to why this is happening? Is there anything he can do to secure the jobs? What, if anything, can he say to reassure the workers in the companies involved? What other State agencies have been involved? Workers want to hear what the Government is going to do about this issue. They do not want to hear that it will just stand by or that there is nothing it can do. I hope it will be able to address the issues involved.

Deputy Clare Daly

There is a certain irony in the fact that the Minister with responsibility for jobs is in India trying to scrape up a few jobs for us while in the background hundreds of highly skilled and important aviation maintenance jobs are on the line. We must view this against the backdrop of the loss of 1,000 such jobs in SRT. Ireland was a world leader in aviation maintenance. If these two companies are allowed to fold, we will lose that skill, on top of what already happened in north County Dublin. The loss of these jobs would be a body blow. We need only look at what happened to the workers in SRT. Many of them have not got jobs since, and that is the future that faces people in Lufthansa Technik and Pratt & Whitney, unless the Government steps in now.

There are a number of issues we must consider. Both operations have been in existence for decades. Pratt & Whitney is highly profitable, its order books are full and its pension scheme is in top class order. However, that company is now collateral damage in the parent company's dealings with Singapore Airlines. More than 75% of Pratt & Whitney's customers come from outside of the company. This is a viable business. Over decades, the workers have delivered first to market ground-breaking aircraft maintenance and engine casing works which have become an industry norm internationally. We cannot allow that to go. These companies have done very well out of the IDA. The Pratt & Whitney site was donated for a song decades ago. The company has even managed to make quite a lot of money from selling off parcels of that land in the past.

Workers have put forward a number of propositions to management, in terms of the idea of diversifying and taking in some extra work from the parent company. They have also proposed that Pratt & Whitney should consider the sale of the operation as a going concern. I want the Minister of State to assure us that the Department is fully involved in these discussions and that the State will step in if necessary. The issues are too important not to do so. The financial reports speak for themselves. These are highly viable industries.

Deputy Emmet Stagg

I appreciate that the Minister, Deputy Bruton, is in India doing his job on our behalf and I thank the Minister of State, Deputy Perry, for coming in to take this debate.

I join my colleagues in expressing my support and empathy with the workers in PWAI and Lufthansa Technik. I wish to emphasise that the situation in PWAI is more urgent than critical. This is a workforce of highly skilled operatives who have a perfect industrial relations record, whose plant is highly profitable and which has a full order book. I have been in contact with the Minister and wish to thank him for his detailed response. I am aware he is employing the full resources of his Department and the agencies available to him to leave no stone unturned to try to save the industry in both plants and the valuable jobs involved. As Deputy Wall has said, the Minister needs to be involved directly, on a hands-on basis, in this matter to ensure this is achieved.

If a rescue is not possible, it is imperative that alternatives are found to ensure the valuable and unique skills of that workforce are kept in productive use.

Minister of State at the Department of Jobs, Enterprise and Innovation (Deputy John Perry)

I would like to thank Deputies Wall, Stagg, Dowds, Daly and Crowe for raising this important issue. The Minister is on an important trade mission to India and regrets he is unable to be here.

I share the concerns of the Deputies in regard to the jobs being lost at Lufthansa Technik Airmotive and Pratt & Whitney Aviation International, PWAI, at Rathcoole in Dublin. My colleague, the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, has been in close touch with both these cases and met with senior management from Lufthansa last Friday. Both companies have had to undertake a global review of their operations. In Pratt & Whitney's case, a decision was taken by the parent company to transfer dwindling customer requirements to a site in the US. This has resulted in the phasing out of older technologies and products. However, the company still has excess capacity across its engineering, maintenance and repair operations.

Four other such sites have been already closed by the company and this is the key determinant in its decision to cease production at the Rathcoole plant and to introduce a redundancy programme there, on a phased basis, over the next 18 months. Some 107 jobs will be impacted by the programme. PWAI has made it clear that it is fully aware of the productive nature of the Irish site and of its skilled workforce, but has said that the decision was a purely commercial one, based on wider market conditions. As Deputies will appreciate, the ultimate decision in these cases is made by the parent company, on strictly commercial grounds and on what is seen by the company as being in the best interests of the group as a whole.

IDA Ireland has met with senior management in the US to discuss the closure of the site and any options for its retention. In addition, the IDA met with management and workers' representatives at the company recently and it was agreed that the agency will liaise with the general manager at the site, with a view to helping the company create a profile of the plant, the workforce and their skills for marketing purposes by the IDA's global team. The IDA will remain in ongoing contact with PWAI during the next 12 to 18 months. In addition, the Minister has arranged that Enterprise Ireland will engage with the company to explore whatever other options might be possible, taking into account that agency's remit and experience in supporting the Irish-owned engineering sector.

In the case of Lufthansa, the decision to close the Rathcoole plant with the loss of 408 jobs was taken following an extensive review of operations, in the context of declining revenues and shrinking international market opportunities. The company has pointed out that the enhanced quality and efficiencies of the new generations of aircraft engines, with reduced need for overhaul, has impacted on their business, with fewer engines becoming available. Complex changes in the dynamics of aircraft maintenance worldwide have knock-on impacts in facilities such as those in Ireland.

The Minister is conscious of the highly-skilled workforces at both companies and has asked the IDA to explore the possibility of securing a takeover or buy-out for either company. I therefore want to assure the House that all that can be done by the State's agencies in an effort to secure a positive result for the employees is being done and will continue to be done. It is of course extremely regrettable that 107 jobs are to be lost at PWAI and 408 at Lufthansa. Both the Minister and I appreciate that these closures will have a devastating impact on employees and their families.

In the wider context, as a Government we have put in place strategies for job creation that are now starting to bear fruit. Unemployment levels have started to reduce and we have had a number of good job wins for the country in recent months. Our key driver to turn around the economy and to concentrate on job creation has been the Action Plan for Jobs and through that strategy the Government has been working to ensure we transform the Irish economy. We are in a situation where the private sector is now creating 3,000 jobs every month, thereby helping to turn around our unemployment levels. While this will be of little immediate consolation to the Lufthansa and PWAI employees and their families, it is a clear sign that Ireland is starting to see better days ahead in the jobs market.

With the right skills programmes in place and with the enterprise agencies working closely with company management, we will do all we can to try to secure a positive outcome for the PWAI and Lufthansa plants. Deputies may rest assured that the Minister will deal decisively with the IDA, Enterprise Ireland and all the State agencies to try to find a solution. The IDA and Enterprise Ireland will remain in close contact with the companies and are arranging to meet with relevant company management regarding the proposed redundancies. They will arrange for a skills base of the workers involved to be put together quickly in a bid to advertise both the plants and the availability of skills to possible third parties.

This is a very competitive industry and because aircraft can be easily flown to competing facilities all over the world, it is truly global, with consequent extreme competitive pressures. Nevertheless, we have a vibrant aircraft maintenance sector which employs more than 4,000 staff, with two very successful companies at Dublin Airport and several operations at Shannon Airport, including other Lufthansa operations, and facilities elsewhere also. In total, we have 14 companies in the sector. These are skilled, high quality jobs and the two State agencies are very active in supporting their client companies in the sector. Ireland has a thriving wider aerospace sector, with several significant aircraft leasing companies supporting more than 3,000 jobs, innovative IT companies developing aviation software and engineering companies supplying components to major aircraft manufacturers.

Deputy Robert Dowds

I thank the Minister of State for his reply, only some of which has been circulated. I ask him to circulate the rest of it. I call on the Minister to brief us on what he can do to get on top of this issue. There is an air of pessimism in part of the Minister of State's reply, particularly with reference to Lufthansa. The fact that there is a 30 day consultation period means, I hope, that there is a window of opportunity to make progress. I urge the Minister of State to do this and anything else that can be done with regard to PWAI.

Deputy Jack Wall

Why did the Minister meet Lufthansa and not Pratt & Whitney Aviation International? It seems from the reply that when IDA Ireland met senior management in the United States, there suddenly seemed to be a negative about the possibility of saving the company because IDA Ireland then met local management to prepare a briefing on the potential to develop the plant further. Why have we given up on this company which has everything going for it? It is profitable and has been pared to the last in the economic approach to job creation, yet the Minister has walked away from it. Will the Minister of State ask the Minister to look at the company's situation because of its profile and it has everything going for it? As other Deputies stated, we cannot afford to lose this type of industry.

Deputy Seán Crowe

The Minister of State said it was regrettable that 107 jobs would be lost at PWAI and 408 at Lufthansa and that both he and the Minister, Deputy Richard Bruton, appreciated that these closures would have a devastating impact on employees and their families. That is an understatement. Many of the employees and their families are probably listening to this discussion and were under the impression that the jobs were still there. The Minister of State has just announced that they are gone. I hope something will be pulled out of the hat. The staff were informed by management last Friday that there was a 30 day window and were asked to come back with plans and suggestions. That is what is happening today is about. We are looking to the Government to come up with new ideas and suggestions. However, the Minister of State seems to have said the jobs are gone. That is not the message people want to hear. Perhaps I picked up on him wrong. This will be devastating not only for the employees and their families but also for the entire area. It is not one in which there is a huge amount of jobs. It has been devastated by unemployment and has some of the highest unemployment rates in the country. There is very little in what the Minister of State has said we can take back to local people. What can we say to them? Is the Minister of State saying there is nothing we can do?

Deputy Clare Daly

I also highlighted the same part of the Minister of State's contribution. It is incredibly defeatist and will not be good news for the workers involved. This exposes the problem of over-reliance on the Government's strategy for multinational corporations. The problem is not the viability of the sector but that these operations do not fit in with the parent companies' plans. That is its essence. Pratt & Whitney Aviation International's Irish operation is a market leader, but it has decided, as part of a deal with Singapore Airlines, to cut off the Irish arm of the operation and allow some of the maintenance division to be developed over time in Singapore. That cannot be allowed to happen. This outfit has benefited enormously from its operation in Ireland and continues to do so. It is highly profitable and the order books are full. If it thinks it is divesting itself of this outfit, the State should step in and take it over as a going concern. The parent company does not want it, not because the work is not there but because it would then be in competition with the parent company's outfit. The other Deputies and I state it would be economic sabotage if these jobs were to go and we want the Government to go in and bat with both companies to state they are viable jobs, that the companies have got a lot out of Ireland and that it is about time they gave something back and stood by the workers. They cannot be allowed to exit.

Will the Minister of State deal with the issue of pensions in Lufthansa because there are slight differences between the two companies and workers in Lufthansa might be slightly more vulnerable than the others.

Deputy Emmet Stagg

The most positive part of the Minister of State's contribution is missing from the script circulated and I ask him to arrange to have the full script circulated as soon as possible. I am very disappointed at what he has had to say because there seems to be an acceptance that it is a fait accompli without making any real effort to reverse the decisions the companies have made or are threatening to make at least. It has been presented as black and white, that the deal is done and the job is finished. If that is the case - perhaps it is - the Minister of State needs to expand on the efforts made to find alternatives, an issue on which he touched in the last part of his script which was not circulated. All of the agencies involved and, as Deputy Jack Wall stated repeatedly, the Minister need to be involved directly in finding alternatives. We cannot afford to lose what is a very special skills base in these two companies and this particular industry.

Deputy John Perry

The Minister, Deputy Richard Bruton, does not consider it a fait accompli. We are restating the facts as announced last week. The Government is actively working with IDA Ireland and the other State agencies involved and meeting the management. It is important to understand the decisions being taken by PWAI and Lufthansa arise from international economic conditions, but there is a thriving market in Ireland and the Government will do everything possible with IDA Ireland which does a very good job and Enterprise Ireland. The Minister has met one of the companies, but I cannot confirm whether he has met the other. I am quite certain IDA Ireland met it and the Deputies should be assured that no stone will be left unturned. The Minister will return from India next week and I am quite certain a meeting with all of the concerned Deputies can be arranged. I will ask him to arrange a briefing in his office with all of the Deputies who have raised the issue and to invite IDA Ireland to it in order that everyone can clearly see the potential.

This market is driven by external forces. We can create the environment in which jobs can be created and the Government has made its best efforts to make the economy more competitive, encourage enterprise and create jobs. This is a very disappointing announcement for it to make. We do not consider it to be a fait accompli and anything we and IDA Ireland can do to encourage a rethink will be done. The manufacturing sector is a key one for the economy. It is important to state the manufacturing development forum established last year by the Minister has been involved in helping to activate the recommendations contained in Forfás's manufacturing strategy. Through this initiative, the Government has a target of creating an additional 20,000 jobs in manufacturing by 2016. That is its job. However, we need to be mindful of changes in operational practice in many manufacturing areas and the aerospace sector is no different. IDA Ireland and Enterprise Ireland are active with companies in the aerospace sector in Ireland with a view to enhancing the potential of good start-ups and encouraging the retention of overseas companies here. I know from personal experience that they have dedicated teams involved.

In general terms, it is important to remember that Ireland continues to be competitive in attracting new investment.

More than 1,000 multinational corporations have chosen Ireland as their strategic European base. Multinationals currently employ 146,000 people. The positive impacts of the Government's policies on job creation are beginning to show. In 2012, the number of jobs in IDA Ireland-supported companies increased by 12,722. This shows the effectiveness of IDA Ireland. The immediate outlook for Ireland's foreign direct investment portfolio is positive, with a strong short-term pipeline. IDA Ireland is confident of securing further investment, including a number that will be capital-intensive in nature.

I will speak to the Minister, Deputy Bruton, when he returns to Ireland next week and ask him to engage in a round-table discussion with the Deputies who raised this matter. I will also ask him to discuss it with the management of both companies and IDA Ireland in order to discover what might be done and ensure that there will be no ambiguity whatsoever. The Government cannot sway multinational companies if they have made decisions but it will certainly do everything in its power to find a resolution in respect of this matter. Deputies may rest assured that the Minister, the Taoiseach and the Government will be 100% committed to finding such a resolution.