The reason this money is being asked for in advance of the general election is that some of the money is required before the general election, no matter what date it takes place, and the second reason is that we hope that if we pass the Bill and that if by any sorry chance, any other Government should be elected to office, they will not torpedo the project as happened in the case of the design to initiate an air service across the Atlantic some years ago.
In regard to the position of the Shannon Industrial Estate, should we subscribe to the Rome Treaty and should the negotiations be completed, it would be impossible for me to say what steps will be taken in regard to the estate. It may be desirable to incorporate the area within the Rome-Treaty area. Other arrangements may be made. At the moment, the number of inquiries continues to be just as great as it was before the project of adhering to the Rome Treaty was mooted. There are reasons for that, too. Labour is getting very scarce in most countries in Europe. Twenty-five per cent. of the entire working labour force in Switzerland is foreign at the moment. There are only a few countries where there is an available supply of labour. There is not an available supply of labour here in quite a number of areas but there is in a great many areas. It is our problem to reduce emigration and provide employment. Shannon offers very excellent prospects to manufacturers.
We hope that the Shannon Industrial Estate will be a showpiece for this country in regard to industrial relations. The very greatest care is being taken by the Shannon Airport Development Company to invite trade unionists and manufacturers who are interested in productivity, particularly all those who are expert, and in trying to see, when the new industries start, that labour relations will be good from the very first. We hope that the Shannon Airport estate will set an example to the rest of the country because it is entirely new and there need be no old prejudices on the part of either employers or workers in relation to industrial relations. That in itself should be an attraction to industrialists, regardless of the results of the Rome Treaty.
Another advantage is that the industrialists who are now coming, genuinely believe in the idea of air freight. It satisfies them. For example, the main reason why the firm of Rippon came to manufacture pianos at Shannon was that they were looking for a site all over Europe from which they could distribute pianos by air and from which the pianos could be moved directly into the freight plane. That is a matter of very great importance to them in relation to freight costs and general expenses. I give that as one example.
A number of Senators tried to make calculations in regard to the capital cost per worker employed in setting up the estate. On the basis that the maximum number employed in Shannon will be some 2,264 persons, the company's total investment will work out at £660 per worker. The factory investment will be £2 million, in actual fact. In terms of working capital and plant or £916 per worker, the total combined investment by the development company and the firms will work out at £1,576 per worker. That is on the basis that none of the options which exist in connection with the factory buildings to purchase these buildings by the companies concerned is taken up. If the options are exercised and all the factories are purchased, the Development Company's total investment would be reduced to £298 per worker.
One Senator gave a figure of £3,000 per worker which is a figure we received from the O.E.E.C. The average cost of establishing a worker in full-time employment from the standpoint of capital required for all purposes in about £3,000. Even if only two-thirds of the number predicted by the company, 2,264, were actually employed, the amount per worker would still fall below the level considered necessary by O.E.E.C.
With regard to housing, I should say that a number of expert town planners, Irish and foreign, have been employed in trying to decide how many people should live within the Airport area. The number of one in every three has been the result of the expert advice received from a number of persons, including people who established new satellite towns in Great Britain and also including Swedish, Dutch and our own experts. I can assure the House that there are a great many people who would not object to living adjacent to the Airport from the point of view of noise. The main runway is some distance away and the jet engines point forwards and backwards at right angles to the housing estate. That eliminates a great deal of the unpleasant noise. We are all getting used to living in noisy conditions. There can be no doubt that people are getting used to the kind of noise they will have to experience in the housing area there.
The rents of the flats will vary from £3 to £4 per week, according to the size of the flat. They will be used by the better paid workers. The houses will be used by executives. The rents for them are higher. The rent of the 100 houses will be more moderate and will be for the less highly paid type of worker. I am glad to say that many of these flats have been booked and some of the industries have even asked for options to reserve accommodation for workers in the houses which have not yet been started.
If all goes well, much of the capital will be repaid with interest over a long period. If anybody wants to raise that matter on Committee Stage, I shall be glad to give the information. In connection with the factory buildings, there is an economic rental which, including maintenance of the outside of the buildings and all the other items of expense, should ensure the repayment of capital with interest over a period of 40 years. In regard to the rental established for the various industries, some were established from the very beginning at an economic rent, while others were not. It is a varying picture. It is impossible to say how far the whole operation will be fully economic. It is hoped they should be able to pay the quite reasonable economic rents judged by standards abroad. The actual rent for the largest type of factory, including all expenses for maintenance — everything but rates — is 3/9d. per square foot, a reasonable figure. Some are paying this figure and some are paying rents increasing by stages.
In answer to Senator O'Donovan, the banks do not like lending long-term loans for industrial purposes and, as a result, the State capital guarantee system was given up and is being replaced by repayable advances.
It was suggested to me that I should keep the sphere of the Company's operation within extremely narrow limits. I am afraid that we do not intend anything of the kind. Anything which adds to the name of Shannon, which increases the number of people coming to Shannon and touring from Shannon to other parts of the country will be promoted by the Shannon Development Company Ltd. If we can afford the money for it, I hope the promotional effort will grow more and more. To avoid duplication, there are continuous meetings of the co-ordinating committee on which there are representatives of the air companies, Bord Fáilte, the Shannon Development Company and my Department so that wasteful expenditure can be avoided and every penny spent by the Company is put to good account.
One of the Senators spoke about the scandalous expenditure for management by the Shannon Free Airport Development Company. He referred to the fact that half of the money spent was for grants to industry and the other half purely on management. The other half spent on management included over £100,000 spent on advertising the Industrial Estate and on a number of promotional ventures to advertise Shannon itself and to encourage people to start from Shannon on a tour of Ireland. The actual running expenses which are naturally heavy in the early stages amount only to a quarter of the total grants issued by the Government and not to a half. Perhaps I should have given those figures in the course of my Second Reading speech.
Senator Donegan suggested that the value of industries in the Shannon Industrial Estate was limited in some way because of the way raw materials were imported and finished goods exported in the duty free areas. In common with other places in this country, in order to qualify for Commonwealth preference, they must add an amount of manufacture to raw materials which varies from 25 per cent. — in the case of a great number of industries at Shannon, it is 50 per cent. — to as high as 75 per cent. value to be added to the cost of the raw materials if they are imported from outside the Commonwealth or British areas. There are rebates on dutiable goods imported into the Republic and not only to the Airport area where those same goods are reexported, an arrangement has been made by the Government in a very large number of cases to ensure that export costs are kept down.
I regret that the accounts were not ready for this debate. A sinister implication was found in that in the Dáil, but in actual fact, as I remarked to Deputy McGilligan in the Dáil, all the accounts of the companies over which I have supervision arise to be presented just at the time the Dáil ends its session. Therefore the ideal position would be that we should undergo the unusual procedure of voting the amount in this session and having the debate next session which carries with it disadvantages. The Shannon Development Company's report was just a little later than other well established State Companies' reports due to the period of stress and strain they have gone through in the promotional activity of a new kind.
Finally, I would remind the Seanad, the company started operation only in January 1959 and got going only about June 1959. It has made very rapid progress. Everything it has done had to be started de novo. Nobody was experienced in this country in building factories in advance for people. Nobody was experienced in building factories close to an airport and the whole of the propaganda, the whole promotional work for this novel idea, became successful in two years. I would also add in regard to the suggestion that there was a pause in the development that some of the factories are not yet fully in operation. The Rippon piano company is working only a quarter or one fifth of its full operation. Workers are still being trained. A great deal of machinery has not yet been installed in some of the other factories. This is an entirely new venture and I hope it will have the support of the Seanad.
May I conclude by saying that there will be no wild spending of money. Both the industries and the houses will be built pari passu with the demand for them. I hope the project is going to succeed. It would not on any account result in a whole collection of empty buildings built a long time ahead of the need for them. It is a project that can grow steadily through the years.
