Industrial Grants (Amendment) Bill, 1968 (Certified Money Bill) : Second Stage.

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

The purpose of this Bill is to provide for an increase in the overall figure of £30 million in the grant money payable by An Foras Tionscal. The House will be aware that the statutory ceiling on the total amount that may be issued in grants to industrial undertakings has been raised on a number of occasions since 1952 when the first sum of £2 million was provided for grants in the undeveloped areas.

The present limit of £30 million was provided in the Amending Acts of 1964 and 1966. At 31st March, 1968, grant payments had amounted to £27,319,179 and expenditure on the industrial estates at Waterford and Galway came to £1,133,812. This brought the total expenditure by An Foras Tionscal to £28,452,991 at that date. Grant payments falling due in the first months of the present financial year have all but exhausted the balance of the £30 million sanctioned by the Acts, and the provision of additional funds to enable An Foras Tionscal to carry on its work and to meet obligations has become a matter of urgency.

Senators will understand that there is always a time lag, sometimes of years, between the approval of an industrial grant by An Foras and the time when the grant becomes due for payment. This was discussed in the House recently. Consequently, the additional provision now being sought, an extra £10 million, will be needed for the most part to make payments on commitments entered into some time back, and would cover such payments for the next year or so.

I mention this to indicate the limited nature of the present Bill. Although it has the Long Title of an Act to amend and extend the Undeveloped Areas Acts and the Industrial Grants Acts, it has the sole purpose of providing additional money to enable An Foras to continue to discharge actual claims for grants which have been approved under existing legislation. It is not a vehicle for carrying through any changes in the structure of the grant system or any additions to or modifications of industrial incentives. All this will be for another day and, I hope, an early one.

Senators will know that reviews have been made of the working of existing schemes, and consultants have been employed to give views on the pattern of incentives suitable to our needs and capacity. When the proposals to amend the structure of our incentives are brought before the Seanad, it is intended that Senators will have access to fuller information about these matters. I do not wish, therefore, to anticipate the debate on the restructuring of our incentives for industrial development. The question of the global provision of money to carry out such a programme will, of course, also come up for discussion then.

As I have said, the position at this moment is that the present statutory ceiling on grant issues has been reached, and an interim increase is required to cover the existing situation until the broader legislation can be enacted. The Bill before the House does two things: it increases to £40 million the maximum that may be issued by the Minister to An Foras, and also sets this new limit of £40 million on what An Foras may pay in the aggregate by way of grants and on industrial estates. I recommend the Bill for the approval of the Seanad.

The Minister has told us that the restructuring of the grant system is for another day, and I hope an early one. I wonder how early? Can the Minister give us any indication when this legislation is to come because here as in so many areas the time-lag that occurs between a proposal being put forward and the Government's decision on it is disturbingly long. I think I am right in saying that something approaching a year has elapsed since the Minister received the report of the consultant, A. D. Little, proposing changes in the structure of the grant system. It is over six months since he received the comments of the NIEC on that report. Over this period we have been promised this new structure but time goes on and we still have not got it. The Minister at this stage would want to give us some indication when the legislation will come because we are approaching a time of the year when new legislation which is introduced now has little chance of getting through. Is it then the case that the legislation will not be introduced until the autumn and will not be put through until the end of the year? If so, that will be a year and a half since the report on which this particular proposal is founded was received by the Minister and 18 months is a very long time to act on a report, although there are certainly many precedents.

I hope that the Minister, in considering the report, will have regard to the recommendations made to him by the NIEC. He and his predecessor have not always accepted the views of the NIEC, in some cases, I think, mistakenly. I recall several years ago that a recommendation was made— it was made originally, I think, by NIEC's predecessor, the Committee on Industrial Organisation—in respect of grants; it was a recommendation to the effect that there ought to be no discrimination against capital intensive projects. Hitherto, in this country, we have taken a very shortsighted view on capital intensive versus labour intensive projects and we have thought in terms of which type of project will give us the most employment immediately, directly, in the short run, without regard to the long-term consequences for employment and the welfare of the community. Recognising this fact, a recommendation was made to the Minister by the CIO that future legislation should remove this kind of discrimination, which had the effect of distorting our whole new industrial structure in favour of projects which were labour intensive and provided more jobs in the short run, but which, for that very reason, may be less desirable in terms of the type of employment provided, the value of the employment and the survival prospects of the industry concerned.

We are, it must be remembered, in the intermediate stage between fully industrialised and developing countries, some of which are catching up on us, and if we concentrate on industries which are labour intensive and can be undertaken without much skill, expertise, or capital, then we are concentrating on industries in respect of which competition will be most acute in the years ahead. What we should be doing is what Northern Ireland is doing. It is concentrating on industries which provide substantial employment and, indirectly, through other industries linked with them, very substantial employment and, by virtue of modern technology and capital involved, they are much less likely to meet this low-cost competition from developed countries to which we have exposed ourselves for years past. It was in recognition of this fact that they proposed that these aids should be done away with. Despite a misleading statement that the recommendation was being accepted, it was, in fact, rejected because, in the new legislation, this discrimination in favour of labour intensive projects continued, irrespective of expert views that this was contrary to long-term employment interests. I would hope that the Minister will have full regard in this instance to the recommendations made to him by the NIEC in respect of the restructuring of our whole grants system.

I should like to ask the Minister about several reports other than the one I have just mentioned, and which was handed to him a year ago. What is the position with regard to the report on the performance of new industries, which the Taoiseach mentioned, and upon which he spoke at some length at the conference of the Irish Management Institute in Killarney? This report has been available for some time past. The Taoiseach selected certain facts and figures from it and presented them to the conference at Killarney. Nothing has appeared since. The report is apparently a factual report telling us what results have been achieved over the past ten years and, judging by what the Taoiseach said, some of the conclusions are interesting and valuable. In the nature of things, this is not a report which would be particularly confidential but, if there are references to particular firms, I take it they could be deleted.

The main body of the report is a general review of progress and it is a puzzle to me and others why it has not been published, despite considerable pressure for its publication. It is unsatisfactory that the Taoiseach should select from a report which has not been published certain facts and figures and publish them selectively. Some time has elapsed since then. The Taoiseach's selection was arbitrary and ill-connected; the items did not hang together and there were a number of inconsistencies. I am sure all this can be explained away but the selection was so arbitrary and so badly done that it left one in grave doubt as to what interpretation to put on the figures. I know some of the explanations for some of the discrepancies. For example, one set of figures included Shannon and another did not. But the Taoiseach did not say that. That is not the way to publish information. This is a useful internal review of what has been achieved over the past ten years, or so, and it is in the public interest that it should be published. It should not be published piecemeal and it should not be produced in such fashion that one can make nothing of it because of lack of skill in selecting the data and because of patent inconsistencies in the information produced.

One is in a difficulty in discussing this kind of subject because one has only this incomplete information. Some of the things the Taoiseach said seemed to be good sense, but it is difficult to comment because one has not all the facts. He said the failure rate was relatively low and it might have been wiser for us not to be so selective and accept a higher failure rate for the sake of getting more for the grant. That could be true. Indeed, I have always taken that view myself in ignorance of the facts, because the facts are not available, but we cannot judge accurately because we have not got the report. I would press the Minister to overcome whatever reluctance there is about publishing this report. Let us have it. Let us make up our own minds on the progress being made. It is difficult to consider this Bill without having that information and it will be impossible to consider a Bill proposing to restructure the whole grants system unless we have the report before us and unless we have adequate time to consider it.

I should also like to ask the Minister at what stage is the Buchanan Report? It involves the preparation of plans for five or six of the physical planning regions not covered by the Litchfield and Wright Reports. This Buchanan Report is of great importance from the point of view of industrial development. Some of our policies for industrial development have taken a certain shape and gone on certain lines which may be invalidated as a result of the conclusions drawn in this report. The Minister will be aware that our physical planning regions at the moment were selected some years ago quite arbitrarily, without any expert knowledge or evaluation, and without any departmental consultation, as far as I am aware. The selection was defended at the time on the grounds that it was purely to get the thing off the ground; it did not represent any final commitment to these particular areas and it did not matter very much what areas one chose so long as one broke the country up into some kind of areas. Fallacious reasoning!

It is my understanding that the terms of reference of the Buchanan Report are wide enough to permit of reconsideration of these regions ultimately should they happen not to be the right regions for regional planning. It is of some significance that Bord Fáilte regions and the siting of regional schools cut across these regions, suggesting there is a divergence of view in Government circles on this matter. It is important this should be settled because the whole development centre policy around which our industrial programme will revolve in future depends on whether the present regions will be maintained or whether they will be varied because the way in which selection is proposed to be carried out is by basing it on these regions.

We were told, first of all, that this was arbitrary, not very important, and could be rectified. Then we were told that the development centres would emerge from the planning work being done in regard to these regions and from that it emerged that the intention was that there would be a development centre in each region. Therefore, the decision about physical planning regions, which was said at first to be not very important, necessarily arbitrary and purely temporary, became at that point vital to the question of how many development centres there were going to be. Now we are in the position that the Buchanan Report is, apparently, reviewing this whole question of how many regions there will be and this affects the question of how many development centres there are.

This is crucial to the Minister's industrial development policy because there are fears among people who have given thought to this subject, who have studied the experience of other countries in this regard, that the attempt to develop more or less simultaneously as many development centres as there are physical planning regions would be a mistake, that the volume of capital available, the volume of new industries coming to the country, are insufficient to secure the development simultaneously of eight or nine different development centres in the country and, therefore, if you are going to base your development centres on physical planning regions arbitrarily selected and, perhaps badly selected, and if the result of this is that you are forced into a policy of having eight or nine centres, which would be excessive and would lead to none being large enough or strong enough to succeed, the policy is defective.

It is very important that we should know what are the recommendations of the Buchanan report. Are the present regions to remain? If they are to remain, are their boundaries to remain unchanged and what recommendations will emerge from this report as regards the selection of development centres, as regards how many there should be, where they should be and the rate and tempo at which they should be developed? The Minister would need to have this information perhaps, before he makes up his mind finally on the new policies for industrial grants.

However, if waiting for the Buchanan Report meant holding up this process for any length of time, I would not recommend it but I understand that although there were earlier fears that the Buchanan Report might be held up considerably, it has, in fact, made better progress than was thought likely and it will probably be available to the Minister to help him in making up his mind on the structure of our industrialisation policy.

It would be difficult to place too much emphasis on the importance of this because our whole industrialisation policy has at all stages been misguided in conceiving the problem on too small a scale and being too local in approach. The Government's unsophisticated aim ten years ago was to have an industry in every little town and village, dispersed rather than concentrated development. The experience of every country which has faced this problem has gone to show that this is a mistake and the whole tide of expert opinion in other countries and in Ireland has gone against this and the Government have been reluctantly— with obvious reluctance at times— attracted in the direction of a more concentrated programme to the point that several years ago they finally approved of the concept of development centres, quite a number of years after the idea was first put forward.

The reason for the reluctance is evident. It is a reluctance which any Government would feel in some degree because, if you select certain centres for development, you do not select the rest of the country, which has more votes, and, politically, it is a difficult decision. It is unfortunate that the Government have been so slow to come to this decision because of the political implications and unfortunate that in coming to it they have rather plumped —and this in public statements by Ministers—for a number of development centres in excess of what is likely to prove successful. It is upon the whole policy of concentrated development that the future of the country will depend and the future of this country outside Dublin will depend.

The only hope for true decentralisation and for the growth of population and of economic activity in the areas outside Dublin lies in the emergence of centres big enough to be viable on their own, not just satellites to Dublin. It would be very unfortunate if this were prejudiced by the Government's unwillingness to concentrate their efforts sufficiently and by half measures involving the dispersal of activity so that out of any eight or nine development centres, none was successful, none was able to rival Dublin, none was able to hold its own, so that the magnet of Dublin would continue to draw to it far too large a share of the industrialisation of the country.

The scale of Government thinking has been too small in this matter also because it has visualised at all times— this the Government will not readily admit but it is the clear implication of their approach to these problems— relatively small industries coming. The industries we have got have been relatively small. We regard an industry employing 500 people as big. It would be regarded as small to medium-sized in other countries, including Northern Ireland. Government thinking has been related to this scale of industry because, in fact, nothing has been done in the past ten years to develop the infrastructure anywhere in Ireland, almost including Dublin, on such a scale as to be able to absorb a really large industry if we could attract one and because there is, nowhere in Ireland, even, perhaps, including Dublin, where you could put a really large industry with water and sewerage facilities, roads, communications and the housing required for workers, we have not attracted such industries. All such industries, without exception, have gone to Northern Ireland. The nearest thing to large industries that we have attracted are a couple of factories employing 1,000, almost all young women, and in a country where we have a pretty even balance of supply and demand for women workers and where there is a very substantial number of male workers, that is not really the kind of industry we most need.

There is nowhere in this country where we could put a really large industry. If one of the industries that Northern Ireland attracts, employing 2,000 men, were willing to come here, to what existing centre in Ireland could it be sent, where it could be absorbed, where there would be houses within the time-scale required, where water and sewerage facilities, roads and communications, schools, education could be provided? Not only have we not got that anywhere, but our administrative structure is still so cumbersome, so out of date, that we could not readily within any acceptable time-scale achieve that position. The time taken from the time when a need is established until it is fulfilled for housing, sewerage, water supplies, roads and schools in this country is so long that no modern industry would be prepared to wait that long.

In Northern Ireland, on the other hand, recognising this problem, they have built up certain areas in such a way, that Northern Ireland programmes, having flexibility in regard to housing them, can attract such industries and guarantee that facilities will be available within the short space of time required and that workers will be available and housed. We have not yet tackled this problem seriously. We are still thinking in the small-scale, piecemeal terms of the 1950s and have not begun to think in terms of the 1960s, never mind the 1970s.

Here, the Minister has a lot to do. It is not an easy job because it is not all within his compass. If the problem were really one for the Department of Industry and Commerce, then the Minister, by applying his energies, could hope to solve the problem fairly easily. The difficulty is in so many Departments being involved and the structure of our Departments, so many Departments with very independent-minded Ministers, not always co-operative with each other, and very independent Departments operating separate policies and absolutely opposed to any type of co-ordination very often, as distinct from agreement to co-operate on their own terms, simply not adapted to solving these problems with the speed required.

Therefore, in criticising the failures in this area I am not criticising the Minister particularly but the whole structure of Government. It is simply inadequate for this purpose. If we are serious about decentralisation and propose to try to do something to create really dynamic centres of growth outside Dublin, as distinct from shifting reluctant civil servants to towns which happen to suit the Ministers concerned, we will have to revise our policies pretty drastically and revise the whole way in which decisions are taken within the public service.

If we are to be able to offer to large industries the kind of service they want, we must be able to say to the American manufacturer willing to establish an industry here employing 2,000 male workers, wanting to get going within 18 months: "Yes, we will be able to provide you with a site, with a water supply, sewerage, roads, houses, schools and workers within that time because we have a system of working under which all this can be put into operation and in which the red tape is cut and the different interests concerned co-operate in such a way as to produce a dynamic result." Until we can get to that point, we will continue to trot along as we are now, getting medium-sized industries and small industries, dispersed around the country. The rate of growth of industrial development is totally inadequate to absorb those leaving school and leaving the land. Until we tackle this seriously, we will continue along that path and in that way.

The unwillingness effectively to decentralise authority has been evident in the work of the Industrial Grants Board, An Foras Tionscal, in respect of the new industrial estates in Waterford and Galway. This is a matter I have raised several times in the House, including no later than last week. This Government throughout their life have shown great reluctance to devolve authority at local level, and indeed in the last few minutes of the speech of the Minister for Agriculture, reluctance to devolve authority even in the field of State enterprise. I thought his remarks on this subject extremely revealing of the attitude of mind of Government Ministers. He made perfectly clear his determination to take power to himself and to hold on to it, and showed his contempt for other Ministers who might think of allowing anything to be done in their area of competence by State bodies which he described as faceless men.

Is that not an unfair interpretation?

I do not think it is. The House can judge. This unwillingness to devolve authority is particularly unfortunate in the area of industrialisation. I particularly welcome therefore that there has been a small breakthrough here, which we had last week when we had the Minister for Transport and Power in the House on the subject of Shannon industrial development, the breakthrough being the handing over of some authority to the Shannon Free Airport Development Authority for the development of the Limerick/Clare/North Tipperary region. I hope this will be followed elsewhere. It is not of course the full devolution of authority one would like to see ideally in that this body is not a democratic body: it is not a local body in the sense of being one locally controlled. Nevertheless, it is at least local in the sense that it belongs in a particular region and is concerned primarily with the interests of that region. It is following along these lines which An Foras Tionscal have shown themselves so reluctant to do in the case of the Galway and Waterford Industrial Estates, that we shall eventually get the kind of combination of local enthusiasm and the participation of professional administrators, without which combination we will never make real progress. One of the great weaknesses of this country is the fact that local voluntary effort and the professional services of administrators are so rarely brought together and combined because of the natural suspicion and unwillingness of the two to come together.

On the subject of local regional activity in the field of industrialisation, it is important that we should think in bigger terms than small localities. That is why this regional development is important. One of the reasons there has not been an effective local effort in attracting new industries, preparing the ground for them and integrating them into local communities, is that local development associations show extraordinary reluctance to co-operate and come together. Each town and village has one. The last check I have been able to make shows there are something like 200 throughout the country as a whole, not one of them having the resources to make it in any conceivable sense effective. They are codding themselves—and we, if we do not say this to them, are codding them—if they think that such voluntary effort, without some full-time executive giving his whole time to the job and without the resources to employ also outside expertise, could ever result in their becoming a really effective body in attracting industrialists to establish themselves here.

If they are not effective bodies, then the administrators understandably treat them without respect as nuisances and pressure groups who come looking for industries but have little to contribute themselves and who have not the financial resources or expertise to do the job. If they could only get together on a regional basis, pool their resources and get away from the idea of the individual local town that has to be pushed, then you might get regional development bodies on a scale and with sufficient resources and sufficient expertise to really do the job. At that stage the more enlightened administrators would be glad to hand over to them some of the authority. We know there are many administrators and some Ministers who want to hang on to power, but it is not true of all. Much of the failure to bring local interests into this work has been because they have not been able to organise in a manner that could gain the confidence of reasonably enlightened administrators. Only by such a combination of regional groups can we get the regional development we need.

In a particular county some years ago, I was asked if I would do some work to help the local development association of a particular town. I said I could but that it would be a waste of time because they were operating on too small a scale. Unless they got together the other towns, at least on a county basis, if not a regional basis, they would not be effective and the money they would be putting into buying my services would not be well spent. An effort was made to bring them together but the result was that it foundered through local jealousies of one kind or another. It turned out to be to my disadvantage to have given them this advice. The result was that nothing matured from this because of the reluctance to work together in the interest of a wider area.

The Minister is aware of the need for a more sophisticated industrialisation policy, of the need not simply to sit back and wait and see who turns up wanting to establish an industry but the need for us to work out for ourselves with the necessary expertise what kind of industries could profitably be established here, to prepare feasibility studies showing what can be done, what resources we have and how they can be applied and to put them to those who might be attracted by the proposition. Other countries are doing this. We cannot expect to attract industrialists if we are not prepared to go to them with concrete propositions showing we have done our homework and that we have the resources and the skills they need. This is not an area of activity in which you can have passive promotion. We must be active not only by having salesmen out in the field but somebody who has with him concrete propositions showing how particular types of industries could usefully be established, how natural resources are available locally, what could be brought into the country at reasonable cost and how the superficial disadvantages of our geographical location could be overcome because transport costs might not be such a burden in particular instances as might have been at first foreseen. We must show how the proposal is an economic one and how the firms concerned could usefully establish here.

That is the kind of approach we need. I know the Minister has taken steps to get our industrialisation effort here on to that level of sophistication. It is important that it should be done as rapidly as possible. There are examples in other countries. For example, there is the study by Ital-consult in the Bari-Taranto region of Italy. One can exaggerate the results of that. Nevertheless it did play a role and it shows the kind of work that can be done in this area by working out the various ranges between different industries and showing how a balanced complex of industries, one industry using by-products and another supplying materials, could be built up in an area of this kind giving development of the kind we also need in Ireland.

One difficulty with our industrialisation problem has been the separation of foreign firms from Irish firms—the surprising reluctance of foreign firms to enter into association with Irish firms. In other countries it is quite a common practice for foreign firms to seek a link with established native firms to facilitate their establishment which they can do because of the local expertise available to them. In this country we have not had that and extraordinarily few of the firms coming here have in fact established such links. This it not for want of trying on the part of the Industrial Development Authority and, that being so, one can only conclude that there is something about our own industrial structure that is not sufficiently attractive or our industries are too small, or not sophisticated enough, or have not themselves sufficient interest in this kind of linkage to form an organisation of this kind in such a way. The result has been that new industries established here have very little roots in the country and are not using any Irish associations. They are nearly always wholly-owned subsidiaries of foreign firms and because of our policy of insisting that their products are exported, they have no interest in the home market. Also, in many cases they use none of our materials.

Perhaps this is because our manufacturers have not been quick enough in developing new kinds of production that would be useful to them. All we have here is solely the unit of production and the industry itself is totally divorced from this country while what we want is industries that will settle and create deep roots here. In many cases these firms do not involve themselves in the community in which they exist. Their managers do not become members of our industrial federations and so on. They remain very isolated. We should be concerned about this. We should want new industries established here to put down roots in the country that would not be easily disturbed. We should not be happy with the situation where many of them are only lightly rooted and have no deep attachments or links with this country.

Also, we should not rely entirely on foreign industry for our new development. The Minister, by the establishment of the Small Industries Branch, has done something here to encourage existing small industries to develop new lines and to expand and contribute to the growth of our economy. This is a useful move, but even with this, we are still not getting sufficient local development, and the proportion of the total increase in activities in industrial output and exports which is accounted for by the new firms coming in from outside seems to be disturbingly large. It seems as if we are not contributing to our own industrial growth and expansion but are simply attracting foreign firms to set up subsidiaries here. That gives employment but it is not sufficient. The State could be more active and more imaginative in the matter. Very few of the State bodies have taken seriously what was said to them by the former Taoiseach some years ago about diversification. One or two have, but for the most part they have been happy to carry on in their existing rut. In some instances their idea of diversification is not successful and has, if anything, worsened the economics of the firm rather than improved it.

There are reasons why State enterprises have not contributed sufficiently to the growth of industry in Ireland. One is that they are inhibited from doing so by fears of competition on the part of the private sector. These fears are understandable but should be allayed. They are real fears in some respects and justifiable because the position has been that the Government impose on them certain social duties and then offer them some form of subsidy or the benefit of free injections of capital without requiring in many cases interest payments or dividends. Private industry, seeing State enterprises put into this unfairly advantageous position as is happening because of the social obligations imposed on them by the Government for employment purposes, are naturally suspicious and resentful of any expansion or diversification of these State industries which would put them into this unfairly competitive advantageous position.

It would be much better to cut this Gordian knot and end this unnecessary and imaginary conflict between State and private enterprise by removing the social obligations from the State sector and imposing on them the duty of being commercially successful undertakings, by taking away their privileged access to capital and then turning to the private sector and saying: "Your legitimate complaints about State enterprise have been removed and State firms are now competing on fair and equitable terms. There is no reason why they should not freely diversify and expand even if it means the competition is directly with you."

I do not suggest that the reaction of private enterprise would be one of unremitting enthusiasm but one could talk in those terms with some confidence, knowing one had solid ground to stand on. At present one cannot do that because of the reasonable fears of private enterprise of the expansion of State enterprise. Until the Government are prepared to face this—I have raised this problem on several occasions in this House—and to get away from the old-fashioned policies of social and political pressure, with subsidies and free capital and so on in the public sector, they will not get rid of the fears of private enterprise about the development and expansion of State firms.

Some of our State firms have great resources of management, expertise, dynamism and energy which, if released, could be of tremendous benefit. These resources are locked up because of wrong pressure from the Government, but, if released, it could give us a useful source of growth. I do not suggest this should be done entirely separately from the private sector. I think it undesirable that such State bodies should establish jointly-owned subsidiaries with private interests here or abroad but that there should be minority shareholding by the private sector. The only case of a jointly-owned State company here is that of Arramara Teoranta. That is an unsatisfactory situation. We are creating a problem for ourselves by making a clear-cut division between private and public enterprise while we should be trying to confuse this distinction. If we put our State bodies on a fair, competitive basis with private enterprise, then they could be given their head and told to get on with the job. We would not be dependent to the same degree on foreign enterprise for industrial growth and expansion of exports. We would have a more dynamic State manufacturing sector working together with the private sector which is becoming more dynamic itself in growth and expansion but which is not contributing sufficiently towards giving the employment we want and which is leaving us to far too great an extent dependent on new, foreign-owned firms.

In this particular area, there are, as the Minister knows, far too many bodies, and while in the past the Government have resisted rationalisation when it was pressed on them, I think the Minister must at this stage be considering it seriously and the proposals he is going to put to us for restructuring our grants system will, I hope, include some rationalisation of the present structure. We have the IDA promoting industry, An Foras Tionscal giving grants, Shannon Free Airport Industrial Estate promoting and giving grants. We have the Industrial Credit Corporation giving loans and An Taisce Stáit Teoranta giving another kind of loan and also there are other sections involved where particular projects affect the area of responsibility of Departments, such as the Department of Agriculture or indeed in some cases the Department of Transport and Power.

The result is that when somebody wants to establish an industry, the time taken to get the approval of all these bodies can be incredibly long. By the time the board of IDA has communicated with An Foras Tionscal, which has consulted An Taisce Stáit Teoranta, which has communicated with the Industrial Credit Company, which has consulted An Foras Tionscal as to whether it should give approval and the whole thing has gone round—this is not an imaginary route; I think it has actually happened—we are very lucky if the foreign industrialist has not gone home or gone somewhere else. It is quite an unnecessarily cumbersome system.

I had thought we are better doing this through the medium of State bodies rather than a Government Department but I have been shaken in this belief by talking to the people in Northern Ireland in the Ministry of Commerce where in accordance with their very simple system, the Government Department does the whole thing. They are in the position of being able to give a quick answer without consulting any boards. I should be reluctant to adopt that system because I do not think our public service is sufficiently flexible in this country to undertake this work but unless we can simplify the present rash of bodies, we may be forced to go back to the old system and copy Northern Ireland, because they claim—and they know something of the contrast between our performance and theirs—they can give a decision in a fraction of the time it takes to get a decision here. It is something which can be done immediately by the Minister. It is a very business-orientated Department with a very business-orientated Minister. He may have other defects from our point of view, but he is a man willing to take quick decisions and to stand over them. We need to reconsider our present structure drastically.

The Senator will appreciate another essential difference is the fact that they are not accountable to Parliament for the grants given, and do not account for them except in the event of failure. No disclosure is made of the amount of the grants given.

The system of accountability is different. It is true no disclosure is made in the same way as here, but they publish more information than we do in respect of these projects. Some years ago I was able to get details of the square footage of every grant-aided factory there. I never got such information from the Minister's Department.

There are two other points I should like to make before concluding. One is that it is important to eliminate any distinction between the treatment of domestic industry and foreign industry. I know the Minister and his predecessor have made a number of decisions that are useful in this respect. The fact that they took so long to make them reflects a lack of imagination. For years anybody who raised this point was told: "there is no legal difference. We do not discriminate against the domestic firm." However, the foreign firm could go to the IDA, while the domestic firm had to deal with the Department of Industry and Commerce and could not get the benefit of the IDA's experience. The fact is that an existing firm would be extending its activities and getting a grant only for the expansion, while the new firm would be getting a grant for the whole of its activity. There is an important difference and one which appears to the Irish manufacturer, wrongly it is true, to be an unfair difference.

There was a failure in imagination not to appreciate the way the Irish manufacturer saw it. However wrong it might be, it is a factor we should have appreciated sooner. In recent years there has been a greater appreciation of the psychological problem one creates by appearing to favour the foreign firm against the domestic firm, and something has been done to remedy this. It is important in any new grant structure which will emerge from the present review that to the maximum extent any appearance of a difference in treatment will be removed, so that the Minister will be able to say to and to convince Irish manufacturers that they are being treated on exactly the same terms as the foreign firm.

The other point I want to make is the restriction on the right of a foreign firm to sell in the home market, a restriction imposing on them the obligation to export 90 per cent of their production. This is a thorny problem and must be considered over a period. Irish industry considers that a firm which gets a grant to set up a factory here should not be allowed to sell in the domestic market against the products of an Irish firm which gets no grant. The Irish firm feels it is unfair competition. This is a problem about which we must do something, partly because the present situation leaves the foreign company without roots in this country. Nevertheless, it is a difficult position and the Minister will have to move carefully in this respect, but the present restrictions are unduly severe. The last obligation under the Control of Manufacturers Act came to an end in January this year. Anybody who now establishes an industry here with the aid of a grant can compete in the home market. What we are left with is the contractual obligation imposed that the firm is not to sell in the home market. This is something we would want to ease carefully as time goes on or we are going to have a very odd industrial structure in this country over a period of years.

These are the things that struck me in relation to this Bill. It is true that some of them are more related to future legislation than to this Bill, which is a very temporary one. Nevertheless, I think it has been useful that this Bill has been brought in and has had to be brought in. It means there is an opportunity for this House and the other House to give their views on the shape of the future legislation which the Minister is at present considering. One of the troubles about our legislative system is that the Government take a decision and then it is discussed in Parliament. At that stage the views of Parliament often cannot weigh very heavily because such a loss of face would be involved in the Government's changing their decision. Anything that gives us an opportunity of discussing the legislation before it takes shape is therefore useful, even though in this case it is by accident we have had this opportunity.

I hope from this debate the Minister will take away some useful ideas for the tasks he has in hand which I hope he will complete in the very near future.

Under the new system in operation I hope we can look forward to the prospect of a further rapid expansion in industrialisation in 1969 and the years immediately after. This is very important because the Anglo-Irish Free Trade Agreement shoe will begin to pinch from 1969 or 1970, and unless there is new industrial expansion, we are going to be in a bad way for employment in a few years time, because of the Government's unfortunate decision to go ahead with the Anglo-Irish Free Trade Agreement without getting compensatory benefits. However, that is not a matter for today's debate.

Cuirim fáilte roimh an mBille seo, agus deinim comhgháirdeachas leis an Aire as ucht an obair thábhachtach atá á déanamh aige faoi. Ó cuireadh an tAcht seo ar bhun i 1952, tá a lán déantúisí scaipthe ar fud na tíre. Go dtí sin bhí an chuid is mó den déantúsaíocht i mBaile Átha Cliath agus ar an gcosta thoir. Tugadh gríosadh do dhaoine thar lear teacht anseo agus déantúisí a chur ar siúl ins na háiteanna iargúlta. Molaim arís an tAire de bhárr an dul chun cinn atá déanta aige i leith na déantúsaíochta.

I do not intend to go outside the scope of the discussion, particularly in regard to what the last speaker has said, in view of the fact that other legislation will be introduced on this matter. At the same time, it is only fair to say that in regard to planning industries in various parts of the country and in the general policy of trying to absorb, through industry, much of our manpower which is leaving the land, the Government have acted for the betterment of the country. It is a policy that has been challenged on many occasions. Down the years it was often scoffed at and made little of; indeed away back in the early days of Fianna Fáil when they decided to establish this useful industrial arm to which I have referred, the usual propaganda was that the Irish workers were not equal to the task, that the goods they would manufacture would not be fit to compete in the home market or on the foreign market. In general, there was an air of despondency created all over the country, that Ireland was a place where cattle were reared by ranchers. This was typical Fine Gael policy, that as far as manufacturing goods from our own raw material resources was concerned, there are people who would be unable to adapt and perfect themselves in the knowhow in the manufacturing industries and that as a whole this was a daft policy. We are very glad to see that things have changed immensely in that respect. Today we have the Minister talking about big industries and that the Government are going all out to attract them to this country. I agree with that. Naturally anyone who had the interest of the nation at heart would like to see more and more industries coming in but the Government's efforts to bring these in are very often severely criticised. When the Opposition talk of the lack of big industries, they should reflect on their own attitude in this respect. Their adverse criticism of such projects as Tynagh mines, the Verolme Dockyards and the proposed Smelting Bill, makes it clear that they—at least the Fine Gael Front Bench—in some constituencies are not in agreement with what the last speaker said in regard to big industries. Indeed, in their election literature, they made it quite clear that they disagreed completely with it.

It is all very well to criticise the Government in these respects but it is the Government who have to accept the responsibility for finding the money necessary to assist these people and for taking it from the taxpayer. The Government have to be serious in their commitments and have to examine the pros and cons of every penny spent in this respect. We can say in all fairness to the industrialists from abroad that the first thing they look to is the structure of government working in the country in which they are to establish their industry. If they are good, sound-headed businessmen and I assume they are, they will plump for stability.

One of the reasons for the success of the industrial revolution here has been the stability of government here. The industrialists coming in have faith in the Irish Government lasting out and that things will not happen as they happened when the Government changed and the Coalition came along and sold out some of these industries just when they were getting established. They also sold the Constellation planes and the shortwave station. These are things people would look to and foreigners coming to invest their money have to be careful and have to assess as best they can the stability in the country.

For that reason, the greatest encouragement they could get is a one-Party Government, a Government well aware of what is necessary to attract capital in, from outside, so that they can be reasonably sure that the business will not go wallop overnight and that they will not lose their money. They also like to see that their employees will have a good way of making a living in stable, respectable employment.

This Bill emphasises the Government's anxiety to ensure that more and more industries, big and small, will be established here. There are some areas to which small industries are better suited, and were I to speak from a personal point of view, I would like to see an industrial centre going up in the north-west, in my own area. I live along the Border and I have a fair idea of that territory. I have not yet seen any of these big industries we hear talked about up there employing the thousands the last speaker referred to.

It may be very easy to raise these large sums in the Six Counties, but I understand the money comes from England and the Six County Parliament has not to raise it. I think the members of the Industrial Development Authority are a body of dedicated men who have done excellent work. Our Minister for Industry and Commerce is a first-class man who has good contacts, who knows his job and is making a tremendous success of it. Industrialists coming in here while he is at the helm in the Department of Industry and Commerce will know that they will get fair treatment. There will be a fair chance of their commanding a good market abroad for their finished products. They will get every support from the Minister and they will respect the efforts he has made to ensure that industries already established will avail of the grants already there to adapt themselves to free trade which eventually will come to us.

I shall reserve any further comments I have to make for the new industrial measure.

Ba mhaith liom mo bhuíochas a ghabháil leis an Aire agus le Foras Tionscal as an méid atá déanta. Tá cuid mhor eile le déanamh chun deantúisí a chur ar bun agus leanúint leis an dea obair. Ar an gcead dul síos ba mhaith liom fáilte a chur roimh an Bille seo. Sí an phriomh aidhm atá leis níos mó airgead a chur ar fáil d'Fhoras Tionscal chun cuidiú leo cabhair a thabhairt do chomhluchtaí chun tionscail nua a bhuní ar fud na tíre. Táim ar aon aigne leis an ndungaoís seo agus sé bun-phrionsabal Fhianna Fáil iarracht agus tréaniarracht a dhéanamh obair a chur ar fáil ins na monarchain nua dos na daoine atá ag tréagint na talún.

It is true, as the Minister said, that the present Bill is just an intermediate measure to increase the availability of grants before we face the important task of reviewing the whole structure of these grants and deciding whether they are achieving their purpose or not, and whether the money is being spent to advantage.

Like Senator Garret FitzGerald, I was rather perplexed by the statement of the Taoiseach at Killarney. I was at the meeting where he quoted figures and the percentage of failures seemed to be extremely low. I should like strongly to support Senator Garret FitzGerald in his plea for publication of this information so that Foras Tionscal and others will be able to gain access to this very valuable survey and draw from it the lessons it contains.

I am encouraged at this stage by the Senator's concern and also by the openmindedness of the Minister to make a few surveys that may be useful in relation to the tasks ahead. I have a high regard for the present Minister and his openminded and fair approach to these matters. This is a time when we have to get back to principles and to realise that when our principles are sick, there is little hope of building a successful edifice on them. The first task we have to face is that of creating a better industrial climate. Our climate, while it may be as good as in other countries, is certainly nothing exceptional and is no great credit to us. I would feel at this juncture that we should be able to involve our workers in more active participation in their industries. With this in mind, I would like to feel that the very liberal grants we are giving to set up industries here, part of which are repayable, would be regarded as community investment in the project, as they are, and that part of that project would be a direct incentive to those putting up some of the remainder of the capital which would be earmarked to encourage future workers in the industry to acquire a portion of the shares in the company.

If we are to achieve that, I think we would break down the great distrust that at present seems to prevail between workers and management. I would like to see the situation where the worker would get part of his pay packet through dividends on shares in the company which he is enabled to obtain by taking over part of the State investment. I have in mind especially the repayable parts of the grant. We can say at present that almost all our workers would find it difficult to do this out of their ordinary earnings. Therefore, I think that special opportunities should be provided to enable workers to earn additional pay and overtime so that they may acquire shares in their undertaking.

I have in mind that most of our new industries could very well operate for a half day or for all day on Saturdays and that the money so earned could be earmarked solely for the purpose of allowing the workers concerned to convert their earnings into share capital. If we can do that and go further with the idea of workers' councils and other meetings between management and workers, we could step into the 70s with a new type of industrial structure more suited to our climate. This is especially true when we speak of developing regional centres. If this means anything the emphasis must be on the region and on the development of local personnel in that industry, so that when things begin to get difficult, like the small farmer and other self-employed people, the workers concerned will work harder and will work longer hours. In an industry in which the workers are part owners they will likewise meet the onslaught of hard times and tougher competition by the only answer of harder work, longer hours and a more efficient use of technology to become more competitive.

Further, in the development of those regional centres I would ask the Minister to press for the delegation of authority. The delegation of authority laid the foundation of the success of the Tennessee Valley Scheme in America. Why should anyone assume that an impersonal body in a capital city should be more knowledgeable and more conversant with what is necessary than a local body which has everything to lose if a project is not successful? I hope the Minister will use his weight within the Government to see that this devolution of authority is carried through and that we will not be faced with the situation that these developments will lead to the grabbing of still more power by the Civil Service departments. I hope the Minister and his Department will be quick enough to realise that they can do far more in partnership and by giving authority to outsiders than by an agglomeration of everything in Kildare Street so that the setting up of a new project will not simply mean that it will be put in charge of a new principal officer in the Department. That would be the building-up of an overwhelming bureaucracy that cannot achieve success.

In the delegation and the devolution of authority I would ask the Minister to give a special place in his grant schemes to co-operative effort. I should like to see the Minister tell the Government that the time has come when this country which once pioneered the co-operative movement under Sir Horace Plunkett and Father Finlay, is once again ready to take up that movement. I hope that the Minister and the Government have been wise enough to see and follow what the co-operative movement has achieved for Denmark and Nova Scotia. I would ask the Minister to read the puerile statement made by his colleague on the previous Bill before the House with regard to the success of the co-operative movement in Nova Scotia.

When did you discover Nova Scotia?

I discovered it long before the Senator discovered or heard of the success of the co-operative movement there. We have difficulties here in the setting of demarcation lines between the various Departments. Last week we had the case of the Shannon Department Authority which with regard to tourism comes under the control of the Minister for Transport and Power and, in regard to another aspect of its operation, comes under the control of the Minister for Industry and Commerce. Is there no way of simplifying that structure?

I would say that today there is one particularly neglected industry in this country and that is the educational industry. At secondary school and university level there is plenty of opportunity of putting that industry on a business basis and of obtaining fees that are both realistic and economical. If this should occur there would probably be need for demarcation between the Department of Education and the Department of Industry and Commerce, but in my opinion any development of education as an industry should come under the same heading and should be part of the responsibility of the Minister for Industry and Commerce.

We have the whole question of changing incentives in order to provide employment for our people, and is it not sad that we take up today's Order Paper and find on it, as we have found on it for some considerable time past, motion No. 10 which says:

That Seanad Éireann takes note of the National Industrial Economic Council Report on Full Employment.

It was on St. Patrick's Day, 1966, that the Minister, Deputy Childers, spoke on this in London and said what a wonderful document it was. It is certainly relevant to matters now coming before the House and I hope an opportunity will be given to the House at an early stage to discuss this important report as an aid to the Minister in his task of formulating the changing policy of industrial grants and promotions.

If we lived in a modern democracy like Holland we would have a Committee of the Oireachtas sitting on the issue of the need to change our industrial grants structure and the steps to be taken in doing so. You would have a responsible committee working fulltime on that matter and on that committee you would have members of the various development authorities, the Department of Industry and Commerce and others who would come together to discuss our records in the past and our hopes for the future.

That would be done before the Bill was committed to writing, but unfortunately, here, working as we are under a 19th century antediluvian system of committee work, in which this House is purely on the floor with no adequate committee system, we have not the opportunities. Perhaps the Minister might arrange for some ad hoc committee, drawn from the Oireachtas and other bodies, to get down to this problem before he produces a Bill, because when the material appears in the form of a Bill it is regarded then as more or less a prestige matter for the Minister and the Party concerned not to deviate in any big degree from what has been put in the Bill at First Stage.

Business suspended at 6.5 p.m. and resumed at 7.15 p.m.