The first report is on proposals for Community aid for industrial restructuring and conversion operations. We have considered these and consulted the Confederation of Irish Industry and the Department of Industry, Commerce and Energy. The proposed regulation will enable Community aid to be given for industrial restructuring and conversion operations to sectors of industry designated by the Council acting by a qualified majority on a proposal from the Commission. The draft Council decisions submitted by the Commission propose to designate two such areas. The purpose of the regulation is to assist the restructuring of industrial sectors where excess production capacity exists. Restructuring would involve rationalisation of research, modernisation of equipment and production and management and sales techniques. The Community aid would be in the form of investment premia or interest rebates. The purpose of the proposed decisions submitted by the Commission in anticipation of the adoption of the proposed regulation is to allow the aid envisaged by the draft regulation to be granted to enterprises engaged in shipbuilding and in the textile industry, particularly in the man-made fibres industry. We have a limited amount of shipping activity. As a result of major restructuring the present state of development of the synthetic fibre sector is one of the best and most modern anywhere in the world. The general feeling was that restructuring may not be necessary.
Community Aid for Industrial Restructuring and Conversion Operations.
The second sentence of paragraph 13 is important.
Yes. We felt that initially the scope of the aid should be extended at least to the textile and clothing industries generally and to the leather and paperboard industries. The man-made fibre sector, modern and all as it is, will be exposed to very severe competition from third countries, particularly the USA, and constant adaptation is necessary. The Sub-Committee's opinion was that the restructuring programme envisaged by the Commission is sufficiently wide to allow Irish manufacturers to participate with benefit. We encouraged the people who spoke to us to avail themselves of the funds.
It is not stated what the source of the severe competition is.
Third countries——
Is it to some extent because the synthetic fibre industry is dependent on oil?
That is correct.
Is there any way this proposal would assist where the problem was one of dependency on and the high cost of oil?
It is mainly concerned with rationalisation of research, modernisation of equipment, production and management and sales techniques.
Does it deal with transport?
No.
The rebate would be at a higher rate in the least favoured regions and therefore the most energy expending.
The problem is reflected to some extent in the main body of the report and it is that we have modern plant for the fibres sector but it is oil dependent. We have higher costs and our position in respect of the supply of oil is more vulnerable than the USA and other countries. I wonder why you conclude that there might be some possibility of the textile industry benefiting from the kind of grants available.
Part of the difficulty is that the grants available under this heading tend to be those taken up at the research and development end of these activities which do not take place here. The CII did not see, at the earlier stages of the discussion, that under the heading of quality control or any other device industry could qualify for something. We drew their attention to that. They agreed they had not looked at it that way and decided to look at it again. There is a wide difference in the Council working party between the delegations and it is unlikely that the proposed regulation will be adopted in its present form. Our hope is that as a result of our discussion with the confederation, industry might avail itself of some of the funds that are there.
PARAGRAPH 1.
To save me saying the same thing over again when we come to the other draft reports, I propose that a sentence should be put in in paragraph 1 that the Joint Committee is indebted to Senator Mulcahy and the members of the Sub-Committee for their work. Accordingly, I move:
To add after the second sentence in paragraph 1 the following:
" The Joint Committee is indebted to Senator Mulcahy and his Sub-Committee for their work ".
What I have in mind is that credit should go where it is due and responsibility at the same time attach. Perhaps we can take it as read that I will be moving the same amendment in relation to the rest of them.
Paragraphs 2 to 16, inclusive, agreed to.
Draft Report, as amended, agreed to.
Ordered: To report accordingly.