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Seanad Éireann debate -
Wednesday, 11 Dec 1946

Vol. 33 No. 3

Industrial Alcohol (Amendment) Bill, 1946.—Second Stage.

This Bill is to extend the objects of the Industrial Alcohol Company. When I introduced the Bill in the Dáil it led, not unnaturally, to a debate upon the activities of the Industrial Alcohol Company and even on the wisdom of having a company to manufacture industrial alcohol. That was a contentious matter when the original Industrial Alcohol Act was passed but, while it would be unreasonable to expect that there would be no reference made to it in this Bill, it really has nothing whatever to do with this Bill. The origin of this Bill lies in the decision of the Government to have some organisation to investigate the possibility of undertaking the manufacture of chemicals on a commercial scale and to undertake their manufacture if it was considered desirable to do so. When we arrived at that decision, it was decided also that, instead of creating a new organisation with these powers and providing by legislation for its establishment and its financing, it was preferable to use the existing organisation of the Industrial Alcohol Company. When, however, we endeavoured to use that organisation in connection with certain chemical manufacturing activities which had been carried on during the war, it was found that the terms of the Act precluded it from engaging in any activities other than those defined in the Act or from devoting any part of its funds to purposes which were not strictly in accordance with the very limited scope of its activities as defined in the original Act.

As the Seanad possibly knows, the Department of Defence, with the cooperation of the Emergency Scientific Research Bureau, carried on the manufacture of certain chemicals used in the production of explosives and used commercially in the manufacture of matches during the war and, at the end of the war, they were naturally desirous of transferring that activity to commercial firms. Similiarly, other forms of chemical manufacture which had resulted from the researches of the Emergency Scientific Research Bureau appeared to be of possible interest even in normal times and it was desired to examine all the commercial problems associated with their manufacture before authorising anybody to undertake it.

Because there was no existing organisation, because the Government wanted to create an organisation and because it appeared a simpler and better device to extend the powers of the Industrial Alcohol Company rather than to set up a new organisation, this Bill was framed in the form in which it now reaches the House. There is a wide number of chemicals used for industrial purposes in this country and difficulty in obtaining supplies of these chemicals or in obtaining supplies in adequate quantities was one of our main difficulties during the period of the war. Some of the problems that arose were met by the activities of private firms instructed by the Emergency Scientific Research Bureau, some by the alcohol company which itself extended the scope of its activities, and some were not met at all. It is obviously desirable that, in relation to these commodities, we should have a more detailed examination, made by an expert organisation, of the possibility of getting them produced here. Because of their character, because of the high capital cost of the equipment required in their production, it is not likely that private commercial enterprise will be interested. The Bill provides that, before the Industrial Alcohol Company—in its new title, Ceimicí, Teoranta—will be able to engage in any form of chemical manufacture, public notice must be given of the intention to license it to undertake that, and any private firms wishing to object to the intervention of Ceimicí, Teoranta, in that business will be at liberty to do so. If it is clear that private enterprise will undertake the provision of the commodity concerned, on an adequate scale and at reasonable cost, then a licence would not be given to this organisation to engage in the business. However, it is not likely that, in regard to the electro-chemical industries as a whole, private enterprise here will be deeply concerned, as economic manufacture, in the normal sense of that term, will not be practicable.

The essential chemicals, the production of which here might be considered very desirable for security purposes, could not be made available at an economic cost to commercial users, unless they were supported by the State or by other activities carried on by the same undertaking. The value of the chemicals imported into this country before the war, of the classes in which this company might at some stage be interested, exceeded £1,000,000. Not all of those could be produced here, and there is a number of them in which this company probably would never be interested; but it is quite clear that there is a substantial field for investigation. The first fruits of this Bill will be the carrying on of those investigations by this company. The scientific aspects of manufacture and the scientific problems involved in manufacture can be safely left to the Institute of Industrial Research, but after those scientific problems have been investigated and solved, there are clearly commercial problems—the process to be used, the type of equipment necessary, the possibility of securing supplies of raw materials from within the country and, of course, the cost of manufacture.

One of the commodities which I mentioned by way of illustration in the Dáil and which will have the attention of the board of this company, is sulphate of ammonia. Before the war, we had examined the possibility of producing sulphate of ammonia here. There are many indications that its manufacture is a particularly suitable industry for this country and we have a substantial internal demand for it. In fact, it was regarded by farmers as a very necessary fertiliser, and its absence during the war years has been a loss. The raw materials required in its production appear to be available here. Our pre-war examination of the possibilities of its manufacture was undertaken by an inter-Departmental committee. It was a very cumbersome and unsuitable instrument, which proceeded far too slowly in its researches, but it did appear to make it clear that sulphate of ammonia could be manufactured at a price very little above, though slightly above, the price at which it was at that time being sold here by producers elsewhere. It was desired not to increase the cost, and other processes were being investigated when difficulties arose because of the approaching war situation. An agreement had been made with an engineering firm on the Continent which appeared to be suitable, but that engineering firm disappeared in the general European upset which followed. Whether the situation has changed in any fundamental respect since the war I could not say.

I do not want the Seanad to assume that the enactment of this Bill will necessarily lead to the manufacture of sulphate of ammonia by Ceimicí, Teoranta. In fact, it cannot do so. Although we are proposing to alter the powers of the company to enable them to investigate these commercial prospects and even to undertake forms of manufacture in certain circumstances, we are not proposing to alter the financial structure of the company. The company was established under the terms of the Act passed in 1938, which empowered the Minister for Finance to invest in the share capital up to a limit of £500,000. His investments to date total £275,000. There is a balance under that Act which could be made available to the company for new enterprises, but in the case of sulphate of ammonia the capital involved would be very much greater than that balance. Therefore, so far as that particular commodity is concerned, the situation is that the company could not engage in its manufacture unless the Principal Act were amended—which would give the Dáil and Seanad full opportunity to discuss the desirability of authorising the company to proceed along that line.

So a new Bill would be necessary—not an Estimate?

An amendment of the Principal Act would be required. I mention that commodity in order to illustrate the type of activities in which we think the company might engage. It was one possibility which appeared to be worthy of investigation before the war. We have not resumed the investigation of it since the war ended, primarily because we had no suitable organisation to carry on the investigation. This company will provide a suitable organisation. It is an existing concern; it has a staff of chemists and engineers—highly competent people—and they can obtain any additional expert advice they require, once this Bill is passed, once their powers are extended and they are given the necessary legal sanction to engage in such activities.

There are certain other provisions of the Bill to which it is necessary to refer. While its primary purpose is to extend the powers given to the company by the Principal Act, so as to enable it to include in its objects the manufacture and sale of any substance all or any portion of which is produced or obtained by a chemical process, that is not the whole of the Bill. It was necessary, and Part III is designed to give effect to the limitation to which I have referred, the limitation which is intended to debar the company from engaging in the manufacture of any chemical product, if any other firm in the country is already engaged in the manufacture of that product in a substantial degree or interested in its manufacture.

The provisions included here are similar to those contained in certain other Acts—the Control of Manufactures Act, and a recent Act concerning the powers of the Electricity Supply Board. Public notice is to be given of the intention to give a licence to the company to undertake the particular form of manufacture. A period is allowed for objections to the granting of that licence to be transmitted to the Minister for Industry and Commerce. He considers these objections and decides whether or not to grant the licence. It is the intention not to grant a licence if it is clear that any private concern is engaged or is likely to be engaged in the production of the goods concerned in a substantial degree. There is, of course, no question of giving the company a monopoly in the production of any class of goods. It is not intended that it should engage in production in competition with others, if these others are likely to do the job adequately.

Because of the device of public notice of the intention to give a licence, it is necessary to contemplate circumstances which do not exist now, but which might exist at some stage and to provide for the control of imports of the commodities the subject of the notice prior to the commencement of manufacture. Section 8 of the Bill makes that provision. It is quite clear that, in normal times, when supplies of commodities are freely available, the publication in advance of manufacture of notice of intention of the company to engage in the particular form of manufacture might well lead to abnormal imports which would completely upset the whole situation. Concurrently, therefore, with the giving of notice, the Government may, if they think it necessary, impose quantitative restrictions on imports.

Section 9 amends the Principal Act to remove certain doubts. During the war, the company extended its production from the manufacture of industrial alcohol to the production of pure, undenatured alcohol used in chemical laboratories and hospitals and also by various industrial concerns as raw materials. It produced that pure natural spirit in a rather makeshift manner and with hastily devised plant during the war years. It is now installing at Cooley suitable, up-to-date plant for the production of undenatured spirit for sale as an industrial raw material and for use in hospitals and laboratories. There is, however, reason to think that the Principal Act must be interpreted as obliging the company to sell all alcohol produced by it to petrol distributors. The original Act was intended to ensure that all the industrial alcohol produced would be sold to petrol distributors; but it could be read to mean that even the undenatured spirit produced would have to be sold also in that way, and Section 9 is designed to ensure that nothing in the Principal Act will be interpreted as debarring the company from selling industrial alcohol to a person other than a distributor.

I mentioned chemical manufacture which was undertaken by the Department of Defence during the war. When the Department of Defence ceased all activity, we asked this company to investigate the possibility of taking over the plant which had been operated by the Department of Defence and continuing that manufacture, if it considered it desirable, with that plant or with new plant. In fact, the company had not power to do so, and it may be that it will not engage in that particular activity, because, while it was necessary to produce these materials at almost any cost during the war, the same necessity does not arise at the present time, and such investigations as have been undertaken up to date appear to cast considerable doubts upon the possibility of these materials ever being produced here at a cost comparable to the price at which they can be imported. It is, however, provided in Section 11 that property of a Minister of State may be assigned to the company. It is intended to cover the possibility of the company taking over from the Department of Defence some of the equipment used by the Department of Defence in the chemical manufacture during the war period and still in the possession of that Department, although not now in use.

I cannot say definitely that the extension of the powers of this company in the manner proposed here will in fact lead to any new form of manufacture by it. But, having regard to the need for having some body of people keeping in touch with the problems of manufacturing chemicals, acquainting themselves with the practical difficulties associated with it, and knowing how best to proceed if any emergency should compel us to proceed, we would, I think, gain by the enactment of this Bill, even if it did not lead to any new manufacture in normal times. I think it is desirable that we should have some organisation available to us, and this organisation appears to be by far the most suitable. We could, undoubtedly, set up a new organisation, with new staffs, powers and finances. It would be, however, not merely uneconomical, but foolish to do so when there is available here an organisation with a first-class staff under a competent board of directors which could add these activities to its other existing activities and could go further and competently direct any form of manufacture which it may be decided to license it to undertake. For that reason, I would ask the Seanad to pass this Bill. I ask them not to attach any special significance to the fact that it is the Industrial Alcohol Company which is given these new powers. That is intended to be a form of economy, a method of using an existing organisation, rather than creating a new organisation for a purpose which, I am sure, everybody will agree is desirable in any event.

The fact that this is an amendment of the Industrial Alcohol Act would, I presume, give us the right to discuss the competence of that company to undertake the task which is being passed over to it by the Minister under this Bill. However, I confess that I have so little acquaintance with what that company has been doing that I will not undertake a critical analysis of how it has done its work. From the beginning, I may say, I always queried the wisdom of the policy set out by the Minister when he anticipated that it would be more profitable to handle a certain product of the land in a factory like that than in certain other factories which all of us could have on our own farms. I will not enter into any discussion of that aspect of the work of the Industrial Alcohol Company, nor attempt an examination of its competence to do the work which the Minister is empowering it to do now under this Bill.

I should like, however, to raise a question as to whether this work which the Minister expects of it could not be better undertaken by a body more closely in touch with the universities. We are in a variety of ways attempting the reorganisation of our industrial effort from the point of view of industrial research and from the point of view of obtaining a knowledge of the value of science to our progress, but I do not know whether we have ever had sufficiently revealed to us the attitude of mind of the Minister towards this whole problem in such a way as to make us satisfied that his approach is the best approach. It is rather piecemeal.

I am not quarrelling with what he is undertaking in this Bill. It is definitely limited; it is quite specific, and I think that he is clear as to what he wants the Industrial Alcohol Factory to attempt. I presume he has at the back of his mind the idea that the efforts that they are going to make are to be concentrated in the main on the possibilities of our developing the manufacture of sulphate of ammonia here. We are quite clear that a variety of activities may be entered upon by them but I just wonder how much these people are competent to achieve in that respect. The Minister tells us that it is mainly on grounds of economy that it has been passed on to them. He tells us that they have an expert staff, for instance. I do not know anything, or at least very little, about their staff. It seems to me that they have been working within a very narrow radius so far, that their expert staff may be expert up to a point. What just have they been doing except distilling alcohol from potatoes? What is their competency to enter this new field which the Minister is opening up to them? I do not know and I should like to hear from the Minister.

That brings me to another aspect of the question, and it seems to me—I think we have to get clear on this—if we are going to enter the field of chemical research here, if we are going to face a future where we hope to build up some sort of institution here where research and the application of the knowledge of the chemist to our problems is going to be considerably developed, we should set about it in a definite, thorough way. That being so, I am afraid I cannot be satisfied that the Minister has here the expert staff whom he can set working on this problem at all. It seems to me that if we are going to build up this sort of organisation, the first thing these people have got to do is to look round the world and to draw upon other countries, in so far as it is possible, to obtain the services of competent people abroad and the talent that is available. Possibly, there is to-day scattered all over Europe a number of people who would be a tremendous asset to us in this new venture. I suggest that we have to face that problem and if we are going to attempt anything of real importance, unless we buy experience of a type that is not available to us here, I do not think the Minister will be laying a proper foundation at all.

A certain aspect of that strikes me immediately. The great chemical undertakings in Britain and on the Continent naturally have all sorts of extraordinary secrets. It is quite conceivable that, in setting up an organisation like this here, some of our young people who have had to leave the country in the past, when set to work on our problems here, may make discoveries, and that, guided and aided by people of established reputations and wide experience in this sort of research, we might achieve something here which possibly may not have been accomplished elsewhere. I should like to suggest to the Minister that it is of the utmost importance, if we are going to build up an organisation like that, that we go out and search for the people who can assist us in that venture. If we are going to select other people, it is most important that we should make a good choice. I would be very careful, if I were bringing such people here, to try to get people who would have certain affinities with us nationally, who would have our approach and our outlook on life, and who would not be here serving us nominally while perhaps really serving somebody else. In the world of chemical research, that is of the utmost importance. I need not dilate further on that aspect of the matter. I suggest to the Minister that if our efforts are to be of real value to the nation, we should be secure in the knowledge that we can trust absolutely the people that we have here to serve our purpose and serve our cause.

I take it that the endeavours of this organisation will be in the main concentrated on discoveries and the development of the manufacture of sulphate of ammonia here. Naturally, they will not concentrate on that alone. I agree that anything that can make life here more secure is an asset which we should seek to possess. In a variety of ways, I have no doubt, the researches of the chemist can make life here much more complete than it is and more secure, especially in a period of emergency like that through which we have passed, but again I should like to strike this note of warning. If we are going to contemplate the production of sulphate of ammonia in this country, we may approach that from two angles. One angle may be the value and the necessity of this commodity to our agricultural effort. The other angle is the national importance of such a chemical organisation within the State, the security which such an organisation would give the nation. There are, therefore, two approaches. If it were only in the interests of agriculture alone, and that it were being conceived and created because in times of emergency the farmer would have within our own State protection in the shape of fertilisers which were not available during a war, then probably the farmer might be expected to pay the price. There is the other aspect—the aspect of national security. We must make up our minds right from the beginning that if we are to put specialists to work on a task which is to give us, some time, big chemical plants for the production of a commodity we formerly imported, it is a sine qua non that these people be able to give the farmers this product at a price not higher than that at which farmers elsewhere can buy it. I think that the Minister recognises, no matter what may be said to the contrary, that the profitability of farming is contingent upon the price of the raw materials. People may be critical of farmers and say that they are always grumbling. We can assert with truth that the farmers can bear their burdens and make their sacrifices in silence when it has got to be done. In that respect, we have recently had a remarkable test in the case of the beet growers. The farmer complains only when there is justification. If the farmers are confronted with a situation in which the raw materials on which they have to depend for increased production have to be bought at home at a price out of proportion to what they are costing the Danish, the Scottish or the English farmer, the nation may gain certain benefits but the farmers' position will be worsened. We must have security against that. Because I recognise that we are not embarking on that project in this Bill and that the capital provided under the original Bill is not sufficient to enable such a new venture to be entered upon without further opportunities for discussion, I need not proceed further along that line.

I stress that the attitude of mind of farmers towards an undertaking such as this is as I have stated. I suggest that, if attempts at production are to be undertaken under the legislation we are now discussing, it will be important to consider the location of the branches of this organisation which may be established. Chemical works are very vulnerable to particular types of attack. If we are to have these things as an asset in times of difficulty, right from the beginning we should consider where those plants are to be located. I do not think that we can deny to the Minister the authority he seeks under this measure. I am all for research so far as the trained mind can add anything to our knowledge and make our lives more complete. We must be prepared to spend money to win knowledge for ourselves. There are things we cannot buy abroad. I am one of those who think that, given the opportunity, our people have a peculiar kind of genius which might enable us to provide for ourselves comforts and advantages that even people wealthier than we are and with much greater natural resources might be unable to provide. I take no exception to the amending Bill, generally.

This Bill gives the company very wide powers indeed. These powers are indicated in Section 4 (c):—

"(i) the manufacture, refining and sale of industrial alcohol and products and derivatives thereof, and

(ii) the making, aiding or subsidising of experiments, investigations, researches and tests in relation to the possibilities of the manufacture of any substance, all or any portion of which is produced or obtained by chemical process, and

(iii) the manufacture and sale of any substance, all or any portion of which is produced or obtained by chemical process."

I should like to refer to paragraph (ii). This seems to me to contain very extensive powers for the factories. They could start to make atomic bombs. That paragraph does not indicate that their efforts are to be devoted to agriculture or to any specific purpose whatever. The provision refers to a substance produced or obtained by "chemical process." That gives very wide power because everything in nature, practically, is obtained by chemical process. Some of them are classified as biochemical processes. Senator Baxter often speaks at length and, having talked so much at length, it is often difficult to know what he has said. His speech gave me the same impression to-night. He spoke so long yet said so little. Did some Senator say that my own meaning was not clear?

I am marvelling at the pungency of Senator O'Donovan's usual type of oratory.

Perhaps this attempt will be somewhat pungent, too. We could easily have a research laboratory of great advantage to agriculture, as well as other industries under this Bill. While Senator Baxter was speaking, it occurred to me that the utilisation of those potatoes for other purposes than conversion into industrial alcohol might be investigated. Senator Baxter knows quite well that the use of potatoes throughout the entire season is very difficult owing to spoilage and that ensilage is recommended. I suggest that investigation into ensilage should be carried out under the powers provided by this Bill.

Anybody who knows anything about the matter knows that that has been long established.

What is long established?

Potato ensilage.

I am speaking of the more effective conversion of the potato into ensilage. I suggest that the ensilage might be provided in bulk in those factories and distributed to the community instead of trying to ensile small quantities of potatoes by boiling them up and putting them in a pit. It is not easy or economic for the farmer, owing to difficulties of fuel, to carry out ensilage in that way, and frequently there was considerable spoilage. I can picture potatoes being commercially ensiled and distributed to the community through the agency of this research institute which the sub-section practically gives us.

I have mentioned that under the powers given here the company could investigate atomic energy generally and atomic energy, rightly directed, might be a very fine thing for the country. There are other ensilages on which a lecture was given during the week in Dublin which this company could investigate and there are many other chemical processes which would be of great interest to the farming community, in addition to the production of sulphate of ammonia, which I hope to see developed under this section. I hope that on the basis of the wide powers given, this research institute will, by its work, provide the country and the farming community with very beneficial discoveries following on chemical research.

Apparently anything which is the result of or obtained by chemical process can be investigated and it really means that this is to be a research laboratory. It will be entering the commercial sphere in the production and distribution of industrial alcohol and other substances, but mainly, it seems to me, it can engage satisfactorily in research work and I confine my remarks to this aspect. I urge that the research should have an agricultural bias so that products of a chemical nature may be secured from farm produce for the benefit of farming and other industries. It is very satisfactory that the name of the company should be changed so as to give it wider powers of production as well as these powers of research which appeal so much to me. If my remarks in this regard have given Senator Hayes an impression of pungency, it is all to the good. I hope they will be of some benefit to the Minister and to members of the House, and I express the hope that the Bill will result in real benefit to the agricultural industry and to other industries.

The Seanad adjourned at 9.55 p.m. until 3 p.m. on Thursday, 12th December.