Seanad Éireann debate -
Wednesday, 6 Mar 1968

Vol. 64 No. 11

Smelting Bill, 1966: Report and Final Stages.

Professor Dooge

I move amendment No. 1:

In page 3 before line 1 to insert the following:—

"(1) Every licence made under this Act shall specify—

(a) the metal or metals and

(b) the pyrometallurgical or chemical or leaching or electrolytic or other process in respect of which the licence is granted.

(2) In the case of any licence granted under this Act and not subsequently revoked, no second licence shall be granted in respect of the same or similar process of smelting the same metal or metals as specified in the said licence within a stated period of years from the commencement of smelting operations, such stated period to be specified in the said licence and not to exceed ten years."

This amendment is concerned with the guarantee which the Minister thinks it is appropriate to make to the particular firm which has undertaken a feasibility study in regard to a smelter in this country. During Committee Stage the Minister indicated that there was an agreement in principle in regard to this particular matter and that he agreed with the case I had made that this matter should, if possible, be the subject of a public enactment rather than a private agreement. The issue between us on Committee Stage was whether it was possible to enact a statutory guarantee of this type and still leave enough flexibility in the matter so that the Minister's hands would not be unduly tied. Accordingly, I have substituted for the amendment withdrawn on Committee Stage amendment No. 1 which I now propose. Subsection (1) of this amendment is the same as subsection (1) of the earlier amendment but subsection (2) has been modified in several respects.

It is difficult to draft in haste an amendment of this sort. In the original drafting of the amendment for Committee Stage, apart from certain circumstances which I mentioned on Committee Stage, I suffered under the disability that the report of the Second Stage debate was not in my hands at the time of drafting the original amendment, so that I had to depend on my recollection of what the Minister had said in regard to this guarantee. In drafting this particular amendment for Report Stage during the interval this evening I again suffered under the disability that I did not have before me the account of the Committee Stage debate. This is a severe handicap, and I am not sure that the amendment now put forward suffices in this regard.

While we are quite willing to accommodate the Minister in this, I think that it is a distinct pity that this situation should have arisen both on Report and Committee Stages in regard to a Bill which bears the announcement that it was ordered to be printed in December, 1966. This Bill, which was introduced in Dáil Éireann 15 months ago, took 15 months to go through Dáil Éireann, and the Seanad now finds itself hampered in endeavouring to reach a formula of words on a principle on which the Minister says there is general agreement because this Bill, having taken 15 months to go through Dáil Éireann, has apparently to pass through Seanad Éireann within eight days.

Nevertheless, accepting these disabilities, I do submit that this amendment in subsection (2) of amendment No. 1 is an improvement on the form of amendment which was put forward on Committee Stage and I would ask the Minister if he could not agree that it does meet many of the difficulties which he raised.

I am, of course, depending on my memory in regard to those difficulties. Of the difficulties which he mentioned one was that it might well be that the firm now undertaking a feasibility study would, even if the study were favourable, not wish to go forward, and in these circumstances he might think it desirable to ask another group to undertake something in regard to the operation of a smelter and that he would wish to give a guarantee to this second group. Such a second guarantee is perfectly feasible under this amendment because I have now omitted from the proposal the phrase "within two years", so that even after two years had elapsed even if the feasibility study went on for more than this time the Minister would be able to give this guarantee because if the original firm undertaking the feasibility study either already hold a licence or if they have been given a licence before the feasibility study is completed and then decide not to go ahead, surely it is reasonable that going ahead with the operation would have been a condition of this licence and, therefore, the Minister would have been in a position to revoke the licence when they indicated that they were not going ahead. Accordingly, we then have the case that there is no pre-existing licence granted under the Act and not revoked and so the Minister would be perfectly able to grant a licence to a second group of individuals whether they form one firm or a consortium and he would then be able to grant them a licence which would be the one standing unrevoked licence and could carry the same guarantee. I think the present wording removes any difficulty in regard to the possible granting of a second licence. If, of course, no licence has been granted before the feasibility study ends, then no difficulty arises.

A second point on which the proposal is being amended is that in the original amendment on Committee Stage it is indicated that the period of years should run from the granting of the licence and this has now been altered in accordance with what the Minister indicated was the nature of the guarantee he was prepared to give, that is that it should run from the commencement of smelting operations so that in this second respect the proposal has been substantially altered in order to fit in with what the Minister has said is the type of guarantee which he wishes to give.

The third matter in which the amendment has been altered is in regard to the period of years for which the guarantee of no second licence for the same process could hold. I certainly had the impression from reading the early Stages of the debate in another place that the guarantee was a perpetual one. However, it emerged at the end of the proceedings there and was quite specific in the Minister's Second Stage speech here that the period for which the guarantee would stand would be a period of ten years and this was the reason why the period of ten years was in the amendment put forward on Committee Stage. During the Committee Stage debate the Minister indicated that that is undesirable because he would then be held to ten years and this might, indeed, be an undesirable thing. This has been modified in the present amendment so that all that is required is a stated period not to exceed ten years. All that is required here is that at the time of the granting of the licence the Minister has to state a period. It might well be argued that this would also leave the Minister in difficulties; that he might feel that he had to grant a licence now even before the feasibility study was finished and that, therefore, he could not say now what the appropriate period of guarantee should be but actually under the terms of this Bill there is no need to grant a licence until the day before smelting commences and I think the Minister has quite some freedom in regard to that.

Therefore, in regard to the omission of the limitation of the guarantee to licences issued within the first two years, this has been modified so that the guarantee can apply to a licence issued at any time provided there is no pre-existing licence in regard to the smelting of the same ores by the same process. The second point is that a change has been made to allow the period of years to run from the commencement of smelting operations and, in addition, this period has been made more flexible in regard to ten years or less.

It is a matter for regret I think that the Report Stage amendment should of necessity have to be drafted in haste and that since the period in which this amendment was drafted—the interval of today's sitting—the Minister has hardly had time to indulge in the calm reflection which one likes to expect from a Minister between Committee Stage and the Report Stage of a Bill. Nevertheless, I hope that the Minister will recognise that we have here something which should be an instrument of sufficient flexibility for his purpose and that he will find it satisfactory so that he could do what he said during Committee Stage he wished to do, namely, to act by way of public enactment rather than by way of private agreement.

Mr. Colley

I freely acknowledge that this amendment goes a considerable distance towards meeting some of the objections which I raised to the previous amendment which was withdrawn. A number of points that I raised are adequately dealt with in this amendment but I must point out that the objections which I made to the previous amendment were made to that amendment. It does not mean that they were the only possible objections and, in fact, I did say that I was very anxious to ensure that I, or whoever might be Minister for Industry and Commerce at the time that this situation would arise, should have freedom to manoeuvre and freedom to negotiate having regard all the time to the fact that whatever kind of arrangement is made and whatever kind of conditions are set out in the licence can, and no doubt will, be made public.

As Senator Dooge has said, I have not had a great deal of time to consider the implications of this amendment but it does seem to me without straining the imagination too far that I can conceive of circumstances in which this amendment, as drafted, would create a difficult situation. If, for instance, as I think is quite likely, a licence were to be granted while the feasibility study is proceeding—I say I think this is quite likely because as I mentioned earlier part of the feasibility study is not merely the technical aspect but the financial aspect and the availability or non-availability of a licence could be of crucial importance in studying the financial feasibility of the project—therefore, assuming that a licence is granted during the duration of the feasibility study it is conceivable that the company which had got the licence, which was carrying out the feasibility study and which had decided that it was a worthwhile operation might, for some reason, wish to ensure that the other company— which, no doubt, it would be another company would be operating the smelter might have a licence contemporaneously with the licence which had been granted to the company carrying out the feasibility study. I do not say that this is something that must happen but I do say it is something which could conceivably happen. I could conceive of certain circumstances in which this might be reasonably requested and I mention this merely as one example. I have no doubt that if I gave a good deal of thought to this, other possibilities would strike me all of which would come under the heading which I made today and that was that I feel that the Minister should be in a position to negotiate what seems to be the best possible deal and that he should not have his hands tied by a too rigid definition of what should be contained in the licence in the Bill.

Having regard all the time to what I have said earlier, whatever arrangement is made, whatever licence is granted, can, as I said, undoubtedly be made public by way of question to the Minister and otherwise, for those reasons, although I say I acknowledge that this amendment goes a considerable way towards meeting some of the difficulties I have mentioned, it does not in my opinion, and there could not, as I indicated, be any amendment which would meet the difficulties involved in tying the hands of the Minister in negotiating. As I said, I do not think the House need worry unduly about that giving too much freedom to the Minister, not merely to me but to any Minister for Industry and Commerce because whatever is done can be elicited and made public.

Professor Dooge

The Minister has said if he had further time to think about this he could have raised further difficulties.

Mr. Colley

I do not think I quite put it like that.

Professor Dooge

I feel there is possibly no limit to Ministers putting forward reasons as to why they could not accept amendments. The reasons the Minister has given tonight are not, I feel, compelling ones. I sympathise with the Minister's feeling that he should have freedom to negotiate but I think the Minister would be in a better position to use that argument if he had not rejected an amendment put forward on Committee Stage, that following the end of the negotiations the fruit of the negotiations under the main headings of the final negotiating settlement would be laid before this House of the Oireachtas. If the Minister had been prepared to accept that he, having negotiated, would report to this House of Oireachtas the outcome of those negotiations he would be in a stronger position to argue that he should be left completely free in regard to the negotiations themselves.

The Minister said the position is that the information will be public, that it will be accessible by way of Parliamentary Questions but Parliamentary Questions are not asked in this House of the Oireachtas. We in this House of the Oireachtas would not like to feel that we are being asked to allow this monopolistic situation to develop and that this House will not be officially informed of it.

The Minister instanced one particular case which he thinks would be difficult to cope with under the terms of this Act. He has suggested that the firm carrying out the feasibility study would be a mining company, that such a firm would like to have a licence in order to be able to raise the money and that at the same time the smelting company which would be formed as a subsidiary and as an associated company might like to have a licence. I do not think this is very likely. If the smelting company had been floated as a subsidiary or otherwise, the obvious course here would be for the mining company, which has organised the feasibility study, to ask the Minister to transfer the licence in this particular case.

The Minister has got great freedom in this Bill even if this amendment were included. I must say I am disappointed he is not able to meet this particular amendment. I feel if the whole passage of this Bill had not been so rushed we might by more leisurely debate on Committee Stage, followed by Report Stage, for which there would be adequate time for preparation, have reached agreement. There is little point therefore, except to withdraw the amendment.

Amendment, by leave, withdrawn.

Professor Dooge

I move amendment No. 2:

In page 3, before line 1 to insert the following:—

"Notwithstanding anything contained in this Act, the Minister shall grant to a mining company or to any company in which the mining company holds more than 50 per cent of the issued share capital a licence to smelt any quantity of ore or ore concentrates produced in Ireland by the said mining company."

This amendment is concerned with the right of a mining company to smelt its own ore. Once again, I feel that this amendment goes a good deal towards meeting the objections raised on Committee Stage. It is important that we should endeavour to reach agreement on this. In the case of the last amendment, as I said, I could sympathise with the Minister's desire that his hands should not be tied but in this amendment we are dealing, not with something in regard to the freedom of the Minister to negotiate, but with the rights of corporations who have made heavy capital investments in this country.

We should be exceedingly careful in this regard and we should in this instance give those mining companies a statutory guarantee of the right to smelt their own ores. It may well be that there is a flaw in this Bill, which we have not seen, which the Minister and his advisers have not seen and as a result of this flaw the Minister might find, having given a licence to a particular firm, that in law certain other mining companies might be circumscribed in regard to the smelting of their own ore. It is only reasonable, to put this beyond any doubt, that the right of a mining company to smelt their own ore should be given statutory effect. It is for that reason that I have tabled this second amendment on Report Stage.

During the course of the Committee Stage the Minister indicated that there were some objections to the form of the amendment brought forward on Committee Stage. Once again, I must say I am under the disability of having to try to meet those objections in a rather hasty redrafting. Nevertheless, I feel that this amendment in its present form should be more acceptable. The Minister commented on Committee Stage that the original phrase in relation to a mining company or an associated company was unduly loose. That has been changed in the present amendment to a "mining company or to any company in which the mining company holds more than 50 per cent of the issued share capital". The condition here is that we are dealing with a mining company or its smelting subsidiary. It could be a smelting or marketing subsidiary. The Minister also made a perfectly valid point on Committee Stage that the amendment put forward then would give the right to a company to associate with a company or even, indeed, through a subsidiary company, to smelt ore imported into the country.

I imagine the Minister might have other powers by which he could prohibit the importation of ore but, nevertheless, I consider this a valid objection. Accordingly, this amendment refers only to ore or ore concentrates produced in Ireland. In regard to those two points I have endeavoured to meet the Minister's objection. In redrafting the amendment, I discovered that there was one point in relation to which I thought it would have to be stiffer. The amendment on Committee Stage read "that the Minster may grant a licence to a company to smelt its own ore". That has now been changed to "the Minister shall". I want to say a few words in justification of that. I thought no company should have the right to compel a Minister to give them a licence to smelt their own ore but when I read through the Bill again and realised that the Minister in his absolute discretion can attach any condition he likes to the granting of a licence, I came to the conclusion that, indeed, a company which has invested a large amount of capital in this country, which has produced ore or ore concentrates should have the right to have a licence to smelt its own ore. But this does not say that this is an absolute right. It will be a circumscribed right, circumscribed by the conditions the Minister can put into this particular licence when he grants it. He can protect a public interest. He can protect a mining interest in any way he likes. I feel that while the Minister is going a long way towards meeting a particular mining group with a feasibility study for a smelter, he should go this distance to meet the other mining interests and say to them, even if one particular company introduces a smelter here: "I will give you a statutory guarantee that you will get a licence to smelt your own ore, no guarantee as to the condition but you will have a guarantee to smelt your own ores." That they have a right to expect.

Mr. Colley

I regret that, again, I find myself unable to accept this amendment.

Mr. O'Quigley

The Minister is impossible to please.

Mr. Colley

It may be that some Senators are rather difficult to please too. I find it impossible to accept this because I believe the drafting of this amendment inadvertently does the same thing as the one which we dealt with on Committee Stage. It, in fact, provides an opportunity for the company operating here in Ireland to erect a smelter which can be used to smelt not only ore produced in Ireland but also ore produced abroad.

Professor Dooge

And concentrates in Ireland.

Mr. Colley

Exactly.

Professor Dooge

So the Minister will accept it if we delete "concentrates".

Mr. Colley

That is not what I said. This, as drafted, strikes at the root of the whole basis of the undertaking which I gave. I am accepting the fact that Senator Dooge finds that this has occurred inadvertently, that he did not intend this and that he did not intend it in the other amendments put forward today which have the same defect but I cannot contemplate any amendment which would have the effect of destroying the whole basis of the undertaking given as the basis on which this Bill was introduced

However, the point of this amendment, as I understand it, was not the one I have been making, that is, the suggestion that every mine-owner in this country should know that he has a statutory right to erect a smelter to smelt his own ore. I wonder if this is not a little exaggerated. It may be desirable but I wonder is it anything more than desirable. After all, this Bill provides for the issue of a licence so that people can only operate a smelter with a licence, but that does not say that people will not be given licences, or that, in fact, what I have told the House in relation to this undertaking will be operated assuming the feasibility study is right and so on. What I am anxious to do is have the machinery to implement an undertaking which I have given and, at the same time, cover a situation in which that undertaking, perhaps, is not operating for the reasons I mentioned earlier, and to have a legal framework in which we can deal with smelting in either of those circumstances. I have made very clear—and it is on the records of both Houses of the Oireachtas—what the terms of that undertaking are. I have made it very clear that the undertaking does not preclude a mine-owner here from having the right to smelt his own ore as produced in Ireland.

It may be argued that this is not in the statute and, therefore, that it is not binding. For this reason I say it could be argued that it would be desirable that the statutory right could be inserted but at the very best that is the most that could be said.

Long years of experience have shown that in circumstances where the Minister concerned has, if you like, read into the official records of the Oireachtas the terms of an undertaking such as this they, in fact, operate as though they were in the statute without the limitations involved but being rigidly controlled, for instance, the 10 year period I referred to today. In other words, what I am saying, in effect, is that the point of this amendment as I understand it, the ensuring of the right of mine-owners to erect a smelter to smelt their own ore produced in Ireland, is being guaranteed, being secured without the benefit of the amendment, which, in any event, I could not accept because, as I said, it strikes at the root of the whole arrangement on which this smelting proposition is based.

Professor Dooge

I find it hard to appreciate how this strikes at the basis of the whole situation. The Minister has indicated that he intends to give a guarantee to one particular company and that he intends, at the same time, to give a licence to any mining company to smelt their own ore or ore concentrates. He indicates that this is statutory because he has read it into the records of the Houses of the Oireachtas. I cannot see that this whole situation would be in danger of being brought to the ground because of the statutory effect of its being written into the records of the Houses of the Oireachtas. The position is that the mine-owner who for any reason has a defective licence or who in any way can be held to have smelted an ore by way of trade commits an offence which makes him liable to a fine of £5,000 and a continuing £500 a day. The circumstances could well be such that a mine-owner would wish to try out a new method of smelting to see if this were suitable for his particular mine. There might well be a mine-owner who wished to try this new pyrometallurgical process. Such a person might inadvertently be held to be smelting because this is included in the definition of smelting here. He could well find himself in contravention of the law.

The Minister said that he could, indeed, allow to be done what he thinks is most undesirable, that ores could be imported and concentrated in this country under this particular amendment and, therefore, defeat the whole purpose. This is quite ridiculous because it is quite obvious that any Minister granting a licence to a mining company to smelt their own ores or ore concentrates would insert as a condition on this particular licence that these ores or ore concentrates have been mined in this country. It is quite clear that this would be a condition. The Minister has power to restrict the operation of a licence by conditions, and, indeed, he could ensure in this way that there would be no danger of the type he has envisaged.

Mr. Colley

He would not have the power if we accepted the amendment. It would override any conditions in a licence.

Mr. O'Quigley

You can fix your conditions in the licence.

Professor Dooge

It would be met by removing the words "ore concentrates". If the Minister now says he is prepared to accept the amendment without "ore concentrates"——

Mr. Colley

That is not what the Minister said. What I said was that the case being made by the Senator is not correct.

Professor Dooge

It would be possible to operate it. The difference that lies between us is that I feel in this instance, when a monopolistic situation is being operated in relation to one group, the least that might be done is to give statutory protection to other groups in relation to the smelting of the ore mined in their mines. We are largely agreed in principle and we differ in detail. When the Minister and Opposition Senators differ in that way there is no doubt what the result will be. I, therefore, wish to withdraw the amendment.

Amendment, by leave, withdrawn.

Bill received for final consideration.

Question proposed: "That the Bill do now pass".

Mr. O'Quigley

I can only regret the bad turn which the debate on this Bill took today. It is quite clear that if adequate time had been given to the House to debate the Bill, introduced 15 months ago in the Dáil, the Bill would leave the House in better shape and with better protection for persons engaged in ore-mining in this country. I am quite satisfied that a misunderstanding or a misinterpretation, a misunderstanding developed between the Leader of the House and me, as a result of which the House has been deprived of the opportunity of having the usual period in which to discuss the Minister's point of view and for the Minister to consider the points of view of Senators for the purpose of amending the Bill on Report Stage. It is a deplorable condition that in this House, which has so few meetings during the year, when we do meet we are forced to pass a Bill in a form which is not as good as it could be if we were given adequate time.

I realise that the time now is late— I know I am confined to the contents of the Bill. The Minister has said he has read certain undertakings and guarantees into the records of the House and that these bind him and future Ministers. I should like him to read a guarantee in this instance into section 5 of the Bill. It is wrong in principle to say that the Minister for Industry and Commerce will have an absolute right—I have no doubt that is the interpretation it bears—to revoke its smelting licence and that this revocation may result in an industry set up at a cost of millions of pounds closing down. That is bad law and bad public policy. The Minister was not prepared to wait for amendments to make some provision for an independent inquiry, by mine experts, engineers or the courts, outside the Minister, if it is seen there has been a breach of this section and of the conditions attached to the licence. The only thing one can do at this stage is to ask the Minister, if that situation ever arises, to agree to have the matter referred——

Tomás Ó Maoláin

Do not say to the courts.

Mr. O'Quigley

——to some form of independent inquiry analogous to that operated under the Town Planning Acts or to arbitration. What the Minister and that side of the House are doing is saying that if the industry is closed down by withdrawal of licence the man can go to the court. That will be too late and the resort to the courts at that stage will be quite useless to protect that man. It is the Minister and those who voted for this section who are driving the person into court by preventing the provision of some form of inquiry. What we have been trying to do is to provide for an independent inquiry before the withdrawal of the licence. The Minister can do that and he should do it in fairness to people who may get licences. It is a pity the House did not accept an amendment to that effect but the Minister may indicate that is the line he will adopt in the event of that situation ever arising. That would do something to repair the damage and to uphold the reputation of the treatment this House gives to matters of this kind which so infrequently come before us.

Tomás Ó Maoláin

How could one take Senator O'Quigley seriously?

Mr. Colley

I do not wish to delay the House unduly but there are two things on which I wish to comment. The first is the delay which occurred between the time the Bill was ordered by Dáil Éireann to be printed and the time it came before this House. That delay was not entirely due to the Minister and his Department. I am not saying some of the delay was not but it was not entirely due to the Minister and the Department and Senator Dooge may know something of what I am referring to. The other matter is the point made by Senator O'Quigley in regard to section 5 which was discussed at length. I shall not say anything more on it except to reiterate my belief that I do not think Senator O'Quigley seriously meant the argument he put forward. I do not think he could possibly mean that this section is to be read as though, in the Minister's opinion——

Mr. O'Quigley

It is even worse.

Mr. Colley

Anyone who can conceive of a business in which there are millions of pounds invested likely consenting to a Minister taking away his licence without doing anything about it is not living on the ground. Such a man can go to the courts, get an interim injunction and if the Minister has not complied with the section there is nothing the Minister can do. We have been over all this today and I doubt if Senator O'Quigley really means the arguments he has put forward. We shall, of course, act in accordance with the kind of practice and procedure which have grown up during the years but I do not undertake to set up any tribunal to operate something like this. I believe the procedure to be adopted would be as fair as we could make it. Furthermore, and most important, the person concerned has a right of appeal to the courts which he will certainly use if his rights are being taken away.

Question put and agreed to.

The Seanad adjourned at 10.40 p.m. until 3 p.m. on Wednesday, 20th March, 1968.