It is scarcely necessary for me to emphasise the importance which must be attached to the development of industrial production as a means of providing employment and easing the balance of payments position by the production of goods here which would otherwise have to be imported and by contributing to our export potential. Successive Governments have accepted the need for creating conditions favourable to the expansion of manufacturing activity; these conditions have taken a number of forms including the grant of protection where necessary, the provision of facilities for securing capital and the provision of information and advice to industrial promoters. More important, perhaps, than the forms of assistance which I have mentioned is the fact that persons contemplating the establishment of industries here know that if they invest their capital and use their abilities in establishing efficient manufacturing units they can be sure that at all stages of their operations they will enjoy the goodwill and encouragement of whatever Government is in power.
Considerable progress has already been made in the field of industrial development. But the need for increased employment, reduced dependence on imports and the expansion of exports requires that further steps should be taken to stimulate and if possible speed up the tempo of industrial development. The Government have therefore decided on certain measures to afford additional incentives for industrial development. Deputies have recently been considering proposals for tax relief in respect of industrial exports and for industrial buildings and the present Bill is designed to implement the Government's proposals for grants to aid industrial development.
The Bill empowers the Industrial Development Authority to make grants of up to two-thirds of the costs of factory buildings and other works required for the establishment of industrial undertakings, subject to a maximum grant of £50,000 in any one case. Before the grant is given the Authority must satisfy itself that the project concerned will be reasonably permanent and is likely to be carried on efficiently and that its establishment will be in the interests of the national economy and is likely to provide substantial employment or to make available substantial quantities of the goods concerned or to provide an opportunity for exports. I do not think that any promoter of a worthwhile project should have the slightest difficulty in satisfying the Authority under these heads as they are in effect the essential prerequisites for the establishment of a sound industrial project. The assistance to be given by the Authority under the Bill will, as I have said, take the form of a grant and once the project has got under way and the grant has been paid the industrialist concerned will be free to manage his affairs in whatever way he thinks best.
When it was decided to introduce the scheme of industrial grants we were conscious that there might be some fears among existing manufacturers that their position might be worsened by competition in a saturated market from new units established with the help of grant moneys. While I could not conceive that the Authority would make grants available in such circumstances, nevertheless, I thought it well to have a provision written into the Bill which would allay any fears on the part of existing manufacturers. Accordingly, the Bill provides that when considering applications for grants the Authority shall have regard to the extent to which the requirements of the public in respect of the commodities to be manufactured are sufficiently met by undertakings already established.
The announcement by the Taoiseach on 5th October of the Government's intention to introduce a scheme for industrial grants indicated that it would be administered in accordance with the accepted policy of decentralisation. The Bill does not contain a specific provision to this effect, but it is my intention when the legislation has been enacted to issue a policy directive in the matter to the Industrial Development Authority. The directive will be in the sense of the reply given in Dáil Éireann to a question on 25th October, 1956, when it was indicated that the accepted policy of decentralisation of industry is to encourage so far as it is practical to do so the dispersal of industry throughout the country so that areas away from the centres of largest population shall secure industrial projects and thereby share in the employment and other advantages resulting from industrial development.
The Bill provides for a maximum aggregate of grants of £2,000,000 for the seven years to the 31st December, 1963, but I must admit that this estimate may fall wide of the mark as the volume of grants will, of course, depend on the extent to which projects came forward for consideration by the Authority. I would be very gratified if the estimate should prove to be too low, as I cannot think of a better way of spending money than on industries which will provide permanent employment for our people, reduce our expenditure abroad on the goods which we need and increase our export potential.
The Bill will not apply to areas to which the Undeveloped Areas Act applies; these areas will continue to enjoy the benefits of that Act.
When the Bill was before the Dáil fears were expressed in certain quarters that its enactment would have adverse effects on industrial development in the areas covered by the Undeveloped Areas Act. I am satisfied that these fears are groundless as projects located in these areas will continue to be eligible for the very substantial facilities made available by that Act under which An Foras Tionscal are empowered to make grants up to 100 per cent. of the cost of factory buildings plus 50 per cent. of the cost of plant and machinery plus a grant towards the training of workers. Compared with these facilities the assistance proposed in the Bill for projects outside these areas is quite modest and will not react adversely on development in the western areas.
As Senators are aware, there are certain areas which are in the unfortunate position of being too far west to share in the benefits attaching to location near the large centres of population on the east coast and of being too far east to enjoy the benefits available under the Undeveloped Areas Act. It is hoped that this new measure will help such areas to secure a share in the benefits to be derived from future industrial development in this country.
I do not think that there are any other matters arising on the Bill which call for comment by me at this stage and I will conclude by expressing the hope that, as the Bill is one which should commend itself to Senators of all Parties, it will be given a speedy passage as an agreed measure.