The main purpose of this Bill is to increase the amount that may be advanced to Bord na Móna to carry out the development programme which they have undertaken. Under the existing legislation, there is a limit of £8,270,000 to such advances and it is proposed to raise that limit to £14,000,000.
The other provisions of the Bill are designed (1) to make additional provision for the board's housing schemes; (2) to provide for the making of a contract of service with the managing director of the board, and (3) to provide for the introduction of pension schemes for the board's staff and whole-time members. Senators are probably aware that Bord na Móna were directed to undertake schemes for the development of bogs for fuel, each designed to achieve a target of 1,000,000 tons per year production at the end of a ten-year period. The first programme, which was launched in 1946, is due to reach that level of production in 1956. The additional funds are required for the completion of that programme. The estimate of cost originally prepared has, of course, proved to be inaccurate by reason of the higher cost of materials and the higher wage rates now prevailing and also because a greater degree of mechanisation has been found practicable than was contemplated when the scheme was being prepared.
For the second development programme, the provision in the 1950 Act only covered initial expenditure. It was fully recognised that new legislation to raise the limit of advances would be required before that programme would be brought to its full development stage. Originally, that programme was also designed to secure an annual production of 1,000,000 tons of sod turf by 1960 but it has been modified in the meantime and the aim now is to secure an annual production of 2,250,000 tons of milled peat by that year for the power stations which are being built by the E.S.B. in the vicinity of the board's bogs.
Of the additional provision which this Bill proposes to make, a sum of £1,480,000 is required for the first development programme and the balance of £4,250,000 to complete the provision required for the second programme.
The board has been constructing houses for its workers and it was entitled to draw, and was drawing, from the Central Fund grants towards the cost of these houses. Under the 1950 Act, however, the grants were limited to £180 per house but it was intended that they should be supplemented by grants of £400 per house from the Transition Development Fund. As it happened, that fund was wound up before the board were able to avail of its provisions and this Bill is designed to authorise the board to receive grants of £570 per house in respect of every house built by it—that is, those already built as well as those yet to be built—which is adequate, with some assistance from the board's own funds, to enable these houses to be let to their workers at reasonable rents.
As regards the provisions of the Bill which relate to the board's own organisation, there are two things to be said. The present managing director of the board is an officer of the Department of Industry and Commerce who, however, has been seconded almost continuously to Bord na Móna for this work since 1934. The view is that the time has come to regularise his position, to establish him permanently as managing director of the board and to enter into a contract of service with him in the normal way.
The view is also held that the time has come when it is desirable to have pension provisions for the board's permanent staff and for the managing director of the board. The board is now a large organisation which is operating successfully on a project which is of great national importance and it is desirable that its permanent staff should feel that security in respect of the future which the establishment of a pension scheme will give.
So far as the managing director is concerned, the provisions of the Bill are permissive. A scheme may be prepared and brought into operation, subject to its being submitted to both Houses of the Oireachtas. So far as the other members of the board are concerned, the Bill proposes to make it mandatory on the board to prepare such a scheme and to submit it to the Minister for Industry and Commerce who, subject to the concurrence of the Minister for Finance, may approve of it and submit it to the Oireachtas.
The position as regards the work of Bord na Móna is that the production under the first development plan is proceeding in accordance with expectations. The quantity of sod turf produced from the bogs developed under that plan last year was 568,000 tons. It will be, it is anticipated, substantially larger this year and there is no reason to think that an annual output of 1,000,000 tons will not be realised by 1956.
In the case of the second development plan, it is, of course, to be understood that none of these bogs is yet in production, but the development work on the bogs is proceeding satisfactorily and again there is no reason to anticipate that the production anticipated will not, in fact, be achieved. The board is now in the position that its operations are yielding a profit. The board had to take over certain debts due to the State by its predecessor, the Turf Development Board, and these debts, on the transfer date, amounted to £434,561. By 1st April, 1952, that debt had been reduced to £261,713 and it was then arranged that the sum outstanding would be funded and repaid by means of half-yearly annuities over a period of 25 years. The first of these annuities was paid on 1st October, 1952.
Under the legislation which established it, the board was exempted from the obligation to pay interest on advances made prior to 21st June, 1951. That exemption from interest charges has now expired and the board is liable, since 1st April, 1952, for interest upon all advances made to it. Interest payments amounting to £109,042 have already been made. The board was not merely able to meet these charges and effect payment of the annuity for the wiping out of the inherited debt and make reasonable appropriations to depreciation and other reserves, but also to announce a reduction in the price of its product early this year, which would probably, in any event, have been necessitated by reason of the fall in coal prices about that time.
The board is also engaged in the production of peat moss. Its experience in that regard was that the market which it had opened in the United States of America was proving less remunerative than it originally was, mainly due to higher shipping freights and to growing competition from continental countries who, in the board's opinion, must be selling at less than production cost in their desire to get dollars by any means, or are enjoying the advantage of lower shipping freights than are possible here. However, against the difficulties in the dollar market for peat moss litter, the home market is expanding very rapidly and also markets in the Six-County area and in Britain, and there is every expectation that the board's output and sales of peat moss litter this year will be higher than in previous years and will continue to grow as the market expands.
The importance of the work of Bord na Móna in providing fuel for power stations is perhaps best emphasised by the fact that the maximum development from water power which is now thought to be possible in this country will provide about 1,000,000,000 units annually which is less than our present consumption. The plans of the E.S.B. made in conjunction with Bord na Móna involve the establishment of a number of new power stations using either sod or milled peat and coming into production to meet the growth in the demand between now and 1960, being adequate, but no more than adequate, by that year to meet the anticipated consumption. It is, however, not easy to expedite the rate of development of bogs for fuel production. A period of three years is normally required for draining a bog before production can start at all and the development of the bog from that on must be carried out in accordance with its characteristics. There is no means by which the output from a bog could be increased beyond that which the board has planned because of these characteristics of the work.
With these new power stations, however, coupled with the water power stations which are being constructed or planned and the existing installed generating capacity of the board, it is anticipated that output will keep ahead of demand, even though one would prefer to see a wider margin during the period between now and 1960. The board has not yet attempted to make plans for the period after 1960 in view of possible technical developments which may take place during that period. It is necessary for the E.S.B. to have its construction programme settled more or less five years ahead, so that before the beginning of 1955 consideration of the programme after 1960 will have to be undertaken.
So far as the board's housing is concerned, it has constructed to date 366 houses and has let most of these to its employees. The aim of the board is to have houses to spare in each area if it can. The idea is that suitable workers can be attracted to permanent employment in the board's service in these areas if housing accommodation can be offered to them, and for that reason the board has aimed at keeping its housing programme in advance of its actual allocation of tenancies. In some cases local authorities have pressed the board to transfer to the board's houses workers employed by the board at present occupying county council houses, but the board have resisted that pressure believing that there is no reason why they should provide houses for workers who are already comfortably housed in the locality of their employment.
The idea behind the board's housing schemes is that they should make facilities available which will attract workers into the area in which there is employment. The county councils have, of course, been reluctant themselves to provide houses solely for the board's employees because of the fact that most of these bog schemes are estimated to have a life of about 25 years and the normal provision for financing county council housing schemes requires a longer period for the repayment of the loans. There are at present 104 houses under construction.
The board is maintaining an experimental station at Droichead Nua, County Kildare, a station at which all problems connected with the production and utilisation of turf are investigated and from which close contact is maintained with developments in other countries of interest to it. Its aim has been, of course, to mechanise the work completely and it has already made considerable progress in that direction. Through mechanisation economies in manpower are possible and the work becomes more attractive to those engaged in it. Drainage operations have been almost completely mechanised and work is constantly proceeding at the experimental station in the design and construction of experimental machines of various types to cope with the problems which are experienced on the board's bogs. The station has given particular attention to methods of securing the most economic and efficient utilisation of turf for industrial purposes. A number of Irish manufacturers have, as a result of cooperation with the board, succeeded in introducing domestic turf-burning appliances which are not only highly efficient but attractive in design and finish.
Recently the station has designed a special method of burning turf in industrial installations and several factories have installed it. Those factories which installed it have confirmed the board's belief that not only have these installations secured a high degree of combustion efficiency but also have made possible a saving in fuel costs as compared with installations using coal or oil. That achievement is one on which, I think, the board and its staff deserve to be congratulated.
The economic advantage to the country of Bord na Móna's activities is obvious. The social advantage should be equally obvious. As a result of the board's work and the decision to develop the peat resources of the country for fuel production, employment has been introduced into areas of the country where the need for it was greatest and where other economic activities did not seem likely to succeed. When the full programme of the board and the associated programme of the E.S.B. have been completed, it will have produced very considerable results in the social circumstances of many of the areas of the country, midland and western, which at one time seemed to offer difficult problems.
The effect should also be to encourage what is the Government's desire, the decentralisation of industry, and the availability not merely of electric power but of cheap fuel where electric power is not suitable in the bog areas, should in the course of time tend to attract new industrial activities there. The work of the board has secured universal approval and for that reason I can with some confidence recommend this Bill to the Seanad.
Business suspended at 6 p.m. and resumed at 7 p.m.