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Seanad Éireann debate -
Wednesday, 10 Jul 1963

Vol. 56 No. 16

Private Business. - Export Promotion (Amendment) Bill, 1963—Second and Subsequent Stages

Question proposed: "That the Bill be now read a Second Time."

The Bill proposes to amend the Export Promotion Act, 1959 in two respects. In the first place it would provide for further grants to Córas Tráchtála to enable them to continue their work in promoting exports. The Export Promotion Act, 1959, which provided for the establishment of Córas Tráchtála, placed a limit of £1 million on the aggregate amount of grants which may be paid to the Board. By the end of last year, grants amounting to almost £850,000 had been made, leaving a balance of approximately £150,000 which would not be sufficient for a further year at the present rate of expenditure. The Bill proposes to raise the limit to £2½ million. Córas Tráchtála has a very important role to fill in the economic life of the country by assisting exporters and by encouraging firms to engage in exports, and I am sure that the House will agree that the necessary funds should be provided to enable the Board to continue this work.

The Bill also contains provisions to enable Córas Tráchtála, if they so decide, to acquire premises and sublet portion of these premises. Because their present premises in London are inadequate to meet the growing needs of Irish export promotion, Córas Tráchtála are faced with the need to seek larger premises; and it is possible that other Irish State-sponsored bodies with offices in London might see advantage in having as many of these offices as possible grouped in one building as might also some of the Irish companies which require representation in London. Córas Tráchtála are at present investigating the possibility of leasing premises in London which would be suitable for this purpose. If it is decided to go ahead, Córas Tráchtála wish to be in a position to occupy part of the building themselves and sublet other parts on the basis I have indicated. The Board's existing powers would not authorise them to lease premises when only a small part of the premises is required for their own purposes and the present Bill will give them the necessary powers. Córas Tráchtála are entirely dependent for funds on an annual subvention from the Exchequer. In order to carry through such an arrangement Córas Tráchtála would require a guarantee by the Government against any loss which they might incur on the leasing and subletting of the premises. The Bill will enable me to give such a guarantee. I recommend the Bill to the House.

There are two parts to the Bill, one increasing the funds available to Córas Tráchtála from £1 million to £2,500,000. The other a practical matter regarding accommodation for Córas Tráchtála giving them powers which they did not hitherto possess. The second part of the Bill seems to be a matter of business, that Córas Tráchtála in places where they have offices should be able to take part of a premises and should be able to make arrangements for themselves. With that there does not seem to be any difficulty.

With regard to the other, I know good work is being done but when one speaks of a figure like £2,500,000 it is legitimate to wonder whether we could be told, whether the Minister could make an effort to express in figures, what precise increase in exports Córas Tráchtála has effected and what the relationship is between the £2,500,000 and the amount of improvement which would be expected. I realise—we all realise—that in our position there is necessity for this kind of body but it would be desirable that we should be able to get something in figures to show us what kind of a return is expected from this £2,500,000. I do not know if the Minister will be able to do anything precise in that matter, whether he will be able to make a reasonable estimate, but I think if he did it would be a great help to all of us.

I shall not oppose this Bill but it struck me when the Minister was making his speech, as apparently it struck Senator Hayes, that the Minister might have told us what has been accomplished by the expenditure of practically £1 million and what can be expected from the further expenditure of another £1½ million. I am all in favour of promoting and encouraging exports for the very simple reason that it provides useful employment for our own people at home. I am, however, wondering whether we have to contemplate this as a permanent arrangement. If so, is this the right way to go about it? We set up Córas Tráchtála, the Oireachtas agreed to provide £1 million at the discretion of the Minister, and he is now asking us to agree to a further £1½ million. What is to happen when this £2½ million is exhausted? Are we to have an annual Bill? Is that the best way of permanently encouraging exports? Has the Minister given any consideration to the possibility of those firms who are assisted by the work of Córas Tráchtála in some way paying for the services being provided by Córas Tráchtála?

Córas Tráchtála employs a staff, and it is obvious from their functions and the work which they perform that they are particularly good and enterprising people, but what sort of security faces those people? Is it going to be a haphazard arrangement of a grant of £1 million as provided previously, another £1½ million provided under this Bill and a question mark thereafter when the £2½ million has been or has nearly been expended? I am hoping that the Minister will give us his thoughts on the matter of whether there is any other method of doing this, and a more permanent method of encouraging the expansion of exports from this country.

I should like to support this Bill very warmly. I do this on general grounds, not from any specific knowledge of the arithmetic or the economics of this organisation. I feel that it is most desirable that we should try by all means in our power and by any devices we can think of to improve our exports. I had some small association with this organisation in an advisory capacity. I have been struck by the amount of energy, initiative and ingenuity they displayed in tackling the various suggestions put forward. They seem to accept or to have a look at almost anything that would appear on the face of it to be reasonable. Some of these projects are esoteric in the extreme and can only be followed when expert and scientific advice is sought, and they do that very freely. They employ for fees scientific people in various departments to help them to evaluate these ideas, and this is a great stimulus to these departments as well.

I was struck by the very high opinions expressed about this organisation in America, both on the east and west coasts. They were well aware of the work being done by Córas Tráchtála and appreciated it and so far as I could see were co-operating very fully with it. I would think that it has had a very pronounced effect on the export drive in the few years in which it has been in existence, and I would strongly support the Bill because it encourages the development of this organisation.

I do not rise to oppose this Bill either, but I think that we are entitled to be critical of it and, as other Senators have said, we are entitled to have expected that the Minister would make a case for giving a further £1½ million to the board. There is another Bill coming before us later which proposes to increase the non-repayable grants to the Tourist Board to £1½ million. The promotion of the tourist business is very desirable. The promotion of exports is most desirable. I wonder, however, are we getting the full returns for this money that we might expect. In the face of these two Bills and particularly the Bill with which we are now dealing we cannot overlook the fact that the adverse balance of payments has risen to £105 million, which is a record, this year. It may be said to me that if we had not Bills like this the adverse balance of payments might be much worse. Maybe so, but I think we are entitled to be told what returns has been received for the money already paid by way of non-repayable grants and what the board is doing and what we can expect from the further £1½ million which this Bill will provide.

As Senator Hayes has said, the second part of the Bill is to facilitate the board in acquiring office accommodation. It is most essential that the board should have adequate office accommodation, and apparently it is thought that it is not possible to obtain that accommodation by acquiring the exact amount of office space that is necessary. This Bill empowers the board to acquire more office accommodation than it really wants, perhaps in the form of an entire house or a couple of houses, and then to shed the portion of that accommodation which it does not require. It apparently is anticipated that in that operation the board may suffer a loss because the Bill authorises the Minister to indemnify the board against any such losses. I can only express the hope that this Bill will not encourage the board to acquire or seek to acquire palatial office accommodation and that it will not encourage the board and other boards like it to develop expensive or extravagant ideas.

Some people think that our missions abroad and our buildings abroad are on too elaborate a scale. If we believe that in order to compete with other nations of the world in searching for exports we must compete with them in the type of office accommodation that we provide, then we are doomed to failure, because, of course, we could not hope to compete with the more wealthy nations and it would be futile and foolish to try to do so. As I say, I can only hope that the Minister will exercise a watchful eye over the activities of this and other boards and see that the money made available to them by the Oireachtas is wisely spent.

I have nothing to say that has not been said by one of the previous speakers. I should like to express my approval of the Bill in general. The recently issued report of the Central Bank lays particular emphasis on the necessity for increased expansion of exports. This particular measures is designed to increased our exports. The Report of the Central Bank refers to the increase in Government expenditure of an unproductive kind, and emphasises very strongly that Government expenditure, whether current or capital, should aim at strengthening the balance of payments. This Bill is strictly productive inside the narrowest definition of that term and, therefore, I think it ought to have the unanimous approval of the Oireachtas.

At the same time, in view of the strictures of the Central Bank on the general increases in Government expenditure, I suggest that the utmost economy should be exercised even on expenditure of this type. The Central Bank in their admirable Report referred to the increase in Government expenditure of all kinds, and the necessity for concentrating on productive expenditure but, strictly speaking, even productive expenditure can be extravagant. Therefore, while I entirely agree with the purposes of the Bill, I think the questions asked by Senator Hayes and Senator Fitzpatrick are strictly relevant to the debate.

The criticism that has been made here about Córas Tráchtála —or rather the questions that have been asked about whether we are getting value for the money that is now being voted for the purposes of Córas Tráchtála—is the first I have heard. I am not objecting to it, because a little criticism does no harm on occasion, to the most successful bodies. Senator Jessop has spoken about the opinion held by people in the United States whom he has met as to the high quality of the service, and the standard of work, given and performed by Córas Tráchtála and their officers. I can assure the House that opinion is shared by the Irish firms who have had occasion to avail of the services of Córas Tráchtála. With regard to ensuring that the annual expenditure is scrutinised I think the very manner in which this money is being given, and the fact that it is given annually, ensures effective scrutiny.

The bulk of the £1 million that has already been passed by the Oireachtas as being available to this body has been spent in the ordinary way. The money is voted annually. Córas Tráchtála, like any Department or section of a Department, must submit their budget annually, first to my Department who, in turn, submit it to the accounting department, the Department of Finance. I can assure the House that every item of expenditure, and every proposed item of expenditure, in that budget is scrutinised very closely, and full account of what the expenditure is intended to achieve is taken in advance. Criticism of the manner in which we provide the money, which was made by Senator Murphy, is possibly criticism of the stinginess, if one might use that word, of the State in dealing with this board.

The £1 million which was voted in the previous Act is almost entirely exhausted. I mentioned in the Dáil how that money has been spent over the years in a broad way, starting with £97,000 in 1959/60, and in the three succeeding years averaging about £250,000. In the current year the grant-in-aid is £310,000 which, as Senators will see, would exhaust the £1 million already voted, by the end of the year.

One purpose of the Bill is to raise the limit from £1 million to £2½ million. I think the Seanad will not agree with the criticism offered by Senator Murphy because, when this £2½ million is exhausted, apart altogether from the annual scrutiny that is given to the budget of Córas Tráchtála, and the annual debate that is held on the Estimates for the Department of Industry and Commerce—of which Córas Tráchtála expenditure forms part—at the end of a period of possibly four or five years, the extra £1½ million will have been exhausted, and there will be an opportunity for both Houses of the Oireachtas, in debating a new Bill, if a new Bill is necessary as I expect it will be, to review the activities of that body, and to ensure that the moneys they are expending are well expended. I think the result that have been achieved show that the moneys have, indeed, been well expended.

I did not give any details of the increases in exports that have been achieved over the past ten years, because they have been fully set out in the annual report of Córas Tráchtála for 1962, which was recently published, and which, no doubt, is available to all members of the Oireachtas in the ordinary way. If Senators will consult that report they will see that in the ten years from 1952 to the end of 1962 the value of our exports increased from £99 million to £168 million. They will see, too, if they care to examine the particular items, that under almost every heading there has been an increase in the value of exports and, with very few exceptions, that increase has been maintained continuously over recent years.

In regard to industrial exports, it is important to realise, as Senator O'Brien has mentioned, and as advised by the report of the Central Bank, that we must depend more and more on our exports in order to improve the standard of living of our people. We know that for international economic reasons it is difficult to rely at the present juncture, at any rate, on agricultural exports, because of the support and subsidy systems operating abroad which limit the capacity of our agricultural producers to find markets for their surpluses. Therefore, in the main, we have to depend on an increase in industrial exports to maintain and increase employment, and to improve the standard of living of our people. I think the expenditure here is modest, having regard to what we must achieve in that field and, indeed, having regard to what has already been achieved. With regard to the premises, at the moment, as Senators might know, Córas Tráchtála have a number of premises in different parts of the world, in London and New York, and one in Brussels. London, of course, is the principal centre, Britain being the principal export market we have. But the premises in London were never really adequate and have recently proved far from being adequate for the purposes of Córas Tráchtála. They were inadequate from the start because they had no shop window there. The premises were situated along Regent Street, and Córas Tráchtála were unable to display even a plate on the outside indicating that they were there, and one had to go through a narrow hallway to the premises where Irish goods were put on display from time to time.

I think it is very obvious, in so far as the main function of Córas Tráchtála is the presentation of Irish export goods, that they should have, if they can acquire them at all, ground floor premises with adequate frontage. It is felt that in order to have such premises they may have to acquire a whole house, or a whole building, most of which they would not need for their own purposes. The existing Act did not, or it is thought that it did not, give them power to lease premises or portion of premises which they would not require and this Bill will do so. I do not think there is any party objection against Irish exports, and, indeed, other Irish interests, having an adequate shop window in London, first of all, because of the size of London itself, being the centre, economic, financial and otherwise, of Great Britain, where our greatest market is, and also because of the millions of visitors who come from all over the world to London. I think it is important for Ireland and what it has to sell and what it has to offer by way of tourism, if the Tourist Board decide to take a lease of part of these premises, that we should display those things adequately in a centre like London.

I think Senator Murphy made a point about the possibility of making exporters who use the services of Córas Tráchtála pay for these services. I think that that would in the first place be a tax on production. In any event, it would be very difficult to apportion the cost among the different types of exporters that we have. As the House knows, many small firms do quite a successful export business but they have not the resources to engage in the market research and to some extent the publicity required to maintain exports at an adequate level. Córas Tráchtála provide such facilities for these and, indeed, for big exporters, too. They carry out market research from their own resources, give grants to firms or groups of firms to engage in market research themselves and in many ways help in a positive way to promote exports.

I would refer Senators to appendix 1 of the annual report. Under the heading "Services to Exporters" they will find a pen picture of the various activities carried on by Córas Tráchtála to aid exporters: market exploration, marketing, buyers' services, advisory services, design, publicity, overseas offices and publications. I can assure the House that their activities under all these headings have been of a very high standard. Therefore, it is with confidence that I recommend the Bill to the House and I am glad to note that it has almost unanimous approval.

Would it be possible to say at all or even make an estimate of how much of the increase in exports is attributable to the activities of Córas Tráchtála?

I am afraid I could not.

That is not possible at all.

Question put and agreed to.
Agreed to take remaining Stages to-day.
Bill considered in Committee.
Sections 1 to 3, inclusive, agreed to.
SECTION 4.
Question proposed: "That Section 4 stand part of the Bill."

I fully agree with the provision of adequate accommodation for this board, for the Tourist Board or for any other board operating on behalf of this country abroad, but I think that accommodation should be in keeping with the country's ability to pay for it and with the return which we shall get. I wonder could the Minister give us any idea of the proposals that have come before them for the purchase of accommodation in London, even rough proposals, or an approximate idea of what it is proposed to expend on the purchase of such a building, whether he anticipates any loss in letting the portion not required by the board and if so how much?

The proposals at this stage are too indefinite to enable me to give any information to the House. In any event, as the Seanad will appreciate, negotiations of this nature are often better pursued if that can be done without the glare of publicity. So far as the possibility of a loss being incurred is concerned I do not believe that will be the case. If Córas Tráchtála succeed in acquiring adequate premises they should be sufficiently attractive to enable them to pay their way at least, so that outgoings would be offset by the return from lettings. At least that is my hope, but one cannot at this stage be assured that this can be achieved.

While a loss is not envisaged, this is a body dependent on voted money having no funds of their own. The purpose of Section 4 or a part of Section 4 is to enable the Minister for Industry and Commerce with the consent of the Minister for Finance to give them a guarantee to meet any possibility of loss being incurred in outgoings as against the income from the premises. It is hoped that no such loss will occur but Córas Tráchtála will be able to negotiate more effectively once they have provision for such a guarantee behind them.

Question put and agreed to.
Sections 5 to 7, inclusive, agreed to.
Title agreed to.
Bill reported without amendment, received for final consideration and passed.
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